LOS ANGELES (CBSLA.com) — An audit of a Los Angeles foreclosure registry program aimed at combating neighborhood blight reveals “significant flaws” in the existing program, according to city officials Tuesday.

City Controller Ron Galperin along with Councilmember Gil Cedillo and Rushmore Cervantes, Interim GM of the Housing and Community Investment Department announced the results of the audit, which Cedillo called for in a City Council motion (PDF) last month.

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KNX 1070’s Pete Demetriou reports Galperin said the four-year-old registry has not properly tracked foreclosures, prevented neighborhood degradation, or imposed fines when lender owned properties became blighted.

As a solution, Galperin recommended creating a self-populating geo-registry to track the properties and their legal owners, inspection of homes when lenders have taken legal ownership of the property and can be held accountable for the condition, and streamlining the collection and registration of the inspection fees.

The recent financial crisis resulted in more than 56,000 completed foreclosures of single family and multi-unit residential properties in LA from 2007 through 2013, according to the audit.

In 2010, the City Council adopted the Foreclosure Registry Program, which established a database for abandoned residential properties as a “mechanism to protect residential neighborhoods from becoming saturated with inadequately maintained and secured abandoned properties as a result of the foreclosure crisis,” according to Cedillo.

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But after a U.S. District Court judge ruled last year that housing finance giants Fannie Mae and Freddie Mac did not have to follow a two-year-old Chicago ordinance designed to limit blight caused by the residential foreclosure crisis, Cedillo said legal concerns lingered over LA’s own ordinance, which closely mirrors the one implemented in Chicago.

“I want to understand what happened in Chicago and how we can improve our ordinance to allow us to be more proactive and maintain our communities free from blight,” stated Cedillo.

A revamped version of the registry is expected to be online by early 2015.

In April, a research firm announced home foreclosure starts in Southern California and statewide increased from January through March after plunging to an eight-year low in the previous quarter.

Click here (PDF) to read the June 3 Audit of the Foreclosure Registry Program.

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