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EUEA discusses receivership SOP, cost estimates and pilot property; staff to provide candidate list
Summary
At an April 24 meeting, the EUEA reviewed a draft receivership standard operating procedure, discussed cost estimates and conflicts of interest, and agreed to review candidate properties for a small pilot; the conversation will continue at the next meeting.
ELKHART — The EUEA on April 24 reviewed a draft standard operating procedure for a receivership program that would allow the group to take temporary control of code‑violating or abandoned properties, stabilize them and recruit developers to renovate or buy them.
Josh, a presenter for the EUEA, said the discussion was intended to quantify staff and contractor hours and the likely expenses if the nonprofit takes on receivership work. "The first thing to frame this around, there are 2 major assumptions that you have to know straight up," Josh said, adding the economic development department would continue to provide administrative support and that EUEA would contract for legal, realtor and developer services the city would not provide.
Board members and staff focused on three practical questions: how much the upfront costs would be, how to avoid conflicts of interest if EUEA helps write and score requests for proposals, and whether to run a small pilot project to test the approach. Josh walked the group through a worksheet that estimated contractor and administrative rates (listed on the worksheet as $100 per hour for realtors, $250 per hour for legal counsel and $35 per hour for economic development services) and projected an early, rough added cost of roughly $4,000 before a sheriff sale.
Board members emphasized the estimates were intentionally approximate. "The estimates will not be exact, and we could argue over, definitely, over this hour or this hour," Josh said. Several members noted that final renovation costs vary widely by property and that much of any receivership expense would be passed to the buyer or developer who eventually takes the property.
Participants discussed process steps that would be needed if EUEA pursues receivership cases: a contract with an independent legal party to draft agreements among EUEA, the city and developers; selection of a contractor/development partner; court approval and temporary transfer of property title to the receiver; renovation and then a sheriff sale where bidders can pay off liens and take title. Ambrose, a long‑time project contributor, described the standard sequence: acquire temporary ownership as receiver, pay taxes and utilities, renovate, compile costs and ask the court to place a lien and schedule a sheriff sale.
Several participants raised potential conflicts of interest. Board members and staff agreed the RFQ/RFP drafting and scoring should be insulated using outside counsel or an independent scoring matrix. "You don't want to write the RFP and then decide the RFP," one member said; Josh and others suggested outside counsel and an independent scoring rubric to minimize appearance of favoritism.
On timing and scale, multiple members urged a small pilot. "Why don't we just pick a proper property, use it as a pilot program, and let's work through this," one board member said. Therese, a staff member in economic development, agreed to circulate the list of properties the city has identified as potential receivership candidates and to ``eyeball'' them for the board before the next meeting. "Absolutely. I'll commit to that," Therese said.
The board discussed alternatives, including placing funds with the Elkhart Community Foundation for grant administration, but noted the foundation does not run an active receivership or redevelopment program and would likely charge for administration. Members reiterated the group's stated aim: preserve downtown buildings, stretch a roughly $250,000 fund by reusing capital where possible and work alongside small downtown developers.
No formal decision to take title to any property was made. The board agreed to continue the discussion and to review a list of candidate properties at the next meeting; the meeting adjourned after that vote.
Ending: The EUEA did not adopt a final receivership policy or approve any receivership acquisition at the April 24 meeting. Members directed staff to provide candidate addresses and return with those properties and additional implementation details at the next scheduled meeting.
