After claims that a law targeting rundown or nuisance properties is being used in a predatory way, a special committee will meet to analyze Act 135 and recommend changes to prevent the exploitation of homeowners.
City Council approved a measure Thursday to create the review group, which will include stakeholders, council members, representatives from the mayor's administration and members of the Pennsylvania General Assembly.
MORE: First look: Photos inside a Center City office-to-residential conversion project
Under Act 135, properties that are considered abandoned or a blight on a block, either by causing a disturbance or reducing nearby property values, can be put under a conservatorship. With a judge's approval, the filer can take temporary control of the property while the original owner foots the legal bills and repair costs to make it sellable. Once it's sold, the conservator gets 20% of the sale price.
Council President Kenyatta Johnson said he's seen instances in his district, which includes parts of Center City and South and Southwest Philly, where the law was being misused.
"We want to make sure that it's transparent when you do decide to confiscate an individual's home and also that there's a level of accountability in terms of how the process is rolled out … and that it's fair," Johnson said.
Gov. Ed Rendell put the original legislation in place in 2008 and the financial incentive was added in 2014. Since then, critics have said developers use it to target homes in popular areas, especially in communities of color. A 2023 Penn study found that Black residents make up 35% of homeowners in the city but accounted for 42.7% of Act 135 respondents. Asian American residents, meanwhile, accounted for 11.8% of respondents while only representing 7.2% of city homeowners.
In one higher-profile case, the Fishtown Kensington Area Business Improvement District invoked the law against a home on Frankford Avenue which the owners claimed wasn't abandoned and was wanted for its prime location. A settlement deal was eventually reached last year to sell the home for $950,000, with the buyer paying legal fees and the group not receiving the 20% conservator charge.
At a City Council hearing about the act in March 2024, Councilmember Jamie Gauthier (D-3rd) said petitions were filed in her West Philly district for properties that the owners were still living in, even though the law states the homes must be abandoned. However, she also noted an instance where neighbors reached out about a property connected to drug sales and shootings and used Act 135 to cease the illegal operations.
"That was an example where Act 135 was the only tool available to us to make that block safe again," Gauthier said during the hearing.
