Bankers get no sympathy from those with dashed hopes

Stick around Las Vegas long enough, and you'll see some amazing things.

A neon jackalope. The real Elvis. Even a U.S. Highway 95 commuter who allows you to merge without flashing you the finger.

On Wednesday at City Hall, I witnessed another rare event. I saw Las Vegas bankers lose an argument in front of local elected officials.

Shocking, I know. I'm still freaked out about it, and I was there in person.

Without a gun to its head, the City Council voted unanimously and almost gleefully to pass an ordinance requiring banks to maintain their vacant, foreclosed properties. The lending institutions must list the houses in a database. Failure to comply with the new ordinance could result in fines and misdemeanor penalties that include the possibility of jail time.

While City Council members and Mayor Carolyn Goodman tried to reassure Nevada Bankers Association President Bill Uffelman that it wasn't the city's intention to incarcerate the banking community, local government wouldn't get much of an argument from Southern Nevada homeowners battered by the mortgage foreclosure crisis. Thousands have lost their homes, and the rest have been hammered by falling housing prices and now have properties that seem hopelessly underwater.

Bankers in jail? It's a dream to be wished by legions.

Traditionally, the Harlem Globetrotters lose more often than bankers around these parts. The financial lobby has long held the Legislature under its spell. And while a lot of us have cordial relationships with our local banking representatives, many of their parent companies played a major role in the ruination of the American housing industry.

Uffelman is lucky the public didn't get to vote on that city ordinance, or bankers might now be facing felony charges -- or maybe the guillotine.

Councilman Steve Ross introduced the changes. The ordinance is similar to ones in place in a number of cities blighted by the foreclosure crisis. While they're imperfect, raise issues of trespass and could complicate the lien process, the ordinances start to hold the financial institutions to account for not mowing the grass and covering broken windows at properties they own.

The mayor and council pounced on the opportunity to remind the bankers' lobbyist that it's well past time to pick the weeds and remove the garbage at vacant and foreclosed upon houses within the city limits. Council members took turns slapping Uffelman around and denied his request to remove the misdemeanor penalty provision.

Uffelman said, "No bank that is a member of the Nevada Bankers Association has a senior VP who is in charge of going to jail."

Not yet, anyway.

On Friday, Uffelman noted several shortcomings in the ordinance. His arguments made good sense. He also acknowledged the challenge of persuading elected officials that the banking community really cares about those distressed homeowners. After 30 years as a lobbyist, Uffelman shrugged, "Getting crapped on is part of the job."

Crushed homeowners who have tried desperately to cut deals with lending institutions know just how he feels. The foreclosure crisis has crippled housing prices and damaged the nation's collective psyche. The American dream of home ownership rings hollow now, and the banks share in the blame.

The ordinance is far from comprehensive. It isn't a cure, but it is a Band-Aid.

"In the end, somebody someday is going to get crossways with these guys (at the city) and wind up with a criminal charge," Uffelman predicted. "I would hope it's not my members. They all say they have every intention of complying."

It's easier for them to say that now the ordinance is in writing.

At the Clark County Commission, Chris Giunchigliani is crafting a similar ordinance that she hopes to see approved by her fellow commissioners in January. Consider it one to watch.

Some Southern Nevada bankers may pout about the new city ordinance, but they should be thankful that enforcing the rules wasn't left in the hands of local homeowners.

John L. Smith's column appears Sunday, Tuesday, Wednesday and Friday. Email him at Smith@reviewjournal.com or call 383-0295. He also blogs at lvrj.com/blogs/smith.