The Palm Beach Post from West Palm Beach, Florida • Page D002

PAGELABELTAG D2 THE PALM BEACH POST REAL NEWS STARTS HERE I SUNDAY, JANUARY 26, 2014 BUSINESS FORECLOSURE CRISIS Mayor mounts long-shot fight against blight But talk of using eminent domain rankles lenders. Ararl 11P4k ..1 14 1 i 1 ir. 4 cli 1 I II 1 I VINO 1.3., 1 'fi. i 0 i 1 j. I Mayor Gayle McLaughlin of Richmond, in front of a boarded-up house in December.

She argues for the use of eminent domain as a way for the city to "buck up against an unjust set of circumstances." JIM WILSON NEW YORK TIMES 2013 Wright, a real estate broker who is leading the local opposition, was satisfied. "This underwater mortgage bailout program," he said later, "is on life support." Richmond held sessions where homeowners could meet with bank representatives and legal aid groups, but too often, the mayor says, the efforts came to naught. Last summer, underwater homeowners owed, on average, 45 percent more than the value of their homes, according to the city manager. So the mayor was all ears when she heard about the eminent domain plan, from both Mortgage Resolution Partners, a company that hopes to make money by administering and financing the plan for many cities, and from her longtime ally, the Alliance of Californians for Community Empowerment, an offshoot of the activist group ACORN. Using eminent domain to heal the wounds of the mortgage crisis has been called crazy, unconstitutional and even "one of the worst ideas ever." But it is not so far removed from mainstream thinking.

In 2008, Sen. John McCain of Arizona, then the Republican presidential candidate, suggested using $300 billion in federal bailout money to buy troubled mortgages and write them down. The problem was that the mortgages had been bundled into pools and resold to thousands of investors all over the world. Eminent domain allows governments to condemn property for a public purpose, like building a road or eliminating urban decay, and applies to intangible property like mortgages as well as to real estate. Richmond argues that its public purpose is to prevent foreclosures and the blight of vacant properties.

The idea is to buy those mortgages out of the bundles and restructure them, restoring equity to the homeowners and keep them from defaulting. Wright said that what bothers him most about the plan is that it will help so few; no one with loans backed by Fannie Mae or Freddie Mac, which guarantee a majority of mortgages, is included. "There's a lot of false hope and that irritates me," he said. "That really irritates me." Richmond's mayor says she has always known it would be a slog. "I'm not trying to minimize what we're dealing with; it's just like, if you're willing to buck up against an unjust set of circumstances, you're going to have those attacks coming at you," McLaughlin said.

"And in some sense that says you're doing your job." vestors to "take houses on the cheap." (The idea is actually to buy mortgages, not houses.) Under similar pressures, at least four other cities that considered the eminent domain strategy have backed away, deeming the risks too great. But advocates in Richmond say their city is different. They hope a unique alignment of anti-corporate political leadership, a concerted grass-roots campaign and union support will lead to a different outcome in this working-class, largely black and Hispanic community in the Bay Area. For a dozen or so other cities that have simi lar demographics and are also plagued by foreclosures, Richmond has become a national test case. The eminent-domain strategy is not a fabulous idea.

Like virtually every other proposal to help homeowners hurt by the housing crash, it tries for simplicity but falters in the face of the enormity of the post-financial-crisis mess, and, as markets improve, it may come too late to make much difference. The plan's legality and wisdom have been debated in editorials and blog posts, with questions ranging from the true value of the mort gages to whether the chosen homeowners deserve the help. But to advocates, eminent domain offers perhaps the only chance to remedy the failure of the federal government and mortgage servicers to offer widespread, meaningful relief to the hardest-hit communities. When the council first voted on eminent domain, in April, members were unanimously in favor. But then the opposition campaign began.

McLaughlin predicted that her motion that September night would pass with five of seven council votes, but it squeaked by with just four. Jeffrey I. LgiegeGit Pm L. 1 A 'Ll l''', 0, AP it 11,. i 1, 4,1 i I i l' 'Mk 11111111111k1 -11 111.n-- Vol 1 1 1- 4 101,, gi.

4 By Shai la Dewan New York Times You can't fight city hall, the saying goes. But Gayle McLaughlin, the mayor of Richmond, a city of 100,000, would tell you that fighting Wall Street is harder. Even for city hall. McLaughlin has a plan to help the many Richmond residents who owe more money on their houses than their houses are worth, but it's one that banks such as Wells Fargo, large asset managers such as Pimco and BlackRock, real estate interests and even Fannie Mae and Freddie Mac, the mortgage finance giants, have tried to quash. Her idea involves a novel use of the power of eminent domain to bail out homeowners by buying up and then forgiving mortgage debt.

But the financial institutions have warned that mortgage lending would halt in any city that tried eminent domain and they have lobbied Congress to ensure that the threat is not an empty one. Opponents have filed federal lawsuits, while real estate interests have made robocalls to residents and sent mass mailers warning that the plan would allow "slick, politically connected" in Clough continued from D1 Diament said. Samuels and Diament began the Palm Beach Jewelry, Art Antique show 11 years ago. Owners of Provident Jewelry, with six locations, the pair has grown the single show into a nationwide company, with 10 shows annually, in markets including New York and Chicago. (Next up: Diament hopes to bring a show to China.) Even as debate rages nationally about expiring money benefits for the longterm unemployed, Diament has seen an increase in spending by people with extra cash to burn.

He's watched buyer demand for his shows rising, right along with the exploding stock market. His theory: The bull market is stimulating the economy and causing people with means to spend more. "More people who are affluent are willing to spend," Diament said. "In 2008 or 2009 or even 2010, they didn't know what the future held, so they held off purchasing. With the stock market, people are feeling good." And more people seem to be in the money, he said.

It isn't just Palm Beach County that is seeing robust interest in arts and antiques. In Los Angeles, for example, Diament just wrapped up the LA Art Show, held Jan. 15-19. The show was purchased 19 months ago by his company and this is its second season under Diament's leadership. For this show, he expanded the offerings to include the Los Angeles Jewelry, Antique Design Show at the same time, BUSINESS STAFF BUSINESS EDITORS Carolyn DiPaolo, 561-820-3704 cdipaolopbpost.com STAFF WRITERS Alexandra Clough, 561-362-5557 Real estate, economy acloughpbpost.com Vendor booths line the aisles of the 2013 Palm Beach Jewelry, Art Antique Show at the Palm Beach County Convention Center.

Show organizers are adding a jewelry and watch show in November. PALM BEACH SHOW GROUP 2013 BUSINESS NOTES New branding for One School JUPITER Bella Group completed a commissioned branding of The One School at Temple Beth Am. Previously known as Temple Beth Am Preschool, the branding included the naming exercise, logo, tagline, collateral and brand essentials. Located at 2250 Central Blvd. in Jupiter, The One School is a NAEYC Accredited, Reggio Emilia Nature-inspired school, serving ages 18 months to five years.

The One School welcomes all religions. Bella Group is a branding agency founded by Greg DuBose more than a decade ago. Boca Regional initiates affiliation BOCA RATON Officials at Boca Raton Regional Hospital and North Shore-LH Health System have announced a three-year affiliation agreement. The agreement has an initial three-year term. North Shore-LH Health System is the largest health care network in the state of New York and one of the nation's largest health care systems, with net annual revenue of more than $7 billion.

The health system has 16 member hospitals and nearly 400 ambulatory physician practices throughout the New York metropolitan area, affiliations with more than 9,400 physicians and a total workforce of more than 47,000 the largest private employer in New York. North ShoreLH also has its own medical school (the Hofstra North Shore-LH School of Medicine) and research enterprise (The Feinstein Institute for Medical get tricky. A stock option is the right to buy a share of stock at a specific price during a specific period. Stock options usually are exercisable, or vest, according to a fixed time schedule, such as three to five years. During the doldrums of the recession, a lot of these stock options were underwater, or lower in value than a stock's price.

But as stock have appreciated, many stock options that once were considered worthless now have value. "Stocks have gone up so dramatically in the past three years no one could have envisioned it," Fisher said. As a result, there's been a lack of awareness about the value of these options and how to divvy them up. Since options can't be transferred, a spouse may have to wait until after a divorce is finalized until they can be exercised. But that raises sticky tax issues for the spouse exercising them, It's an issue that now should be addressed during a divorce, he said.

Fisher said it's important to come up with a tax strategy that doesn't require a spouse, say, the husband, to reveal his taxes once the divorce is over and the stock options are exercised, Fisher said. Fisher recently dished about the issue on CNBC (video. cns.cornigalleryRvideo 3000236906.) He also wrote a lengthy piece for the Florida Bar Journal, a monthly magazine for lawyers. Alexandra Clough writes about the economy, real estate and the law. acloughpbpost.com Twitter: acloughpbp Emily Roach, 561-820-4535 Retail, general assignment eroachpbpost.com Susan Salisbury, 561-820-4577 Consumer issues ssalisburypbpost.com Martin Health gets employer honor STUART Martin Health System has been recognized by Employer of Choice International, Inc.

for the fourth time in the past five years. This designation places the health system in a group of 28 health care organizations from across the country that have been recognized as an Employer of Choice and the only health care organization that has received the designation four times. Martin Health previously received the designation in 2009, 2010 and 2011. The Employer of Choice designation is awarded to public, private or nonprofit employers that are effective in attracting, developing and retaining outstanding people. Learn: Crowdfunding Sally Outlaw, CEO of Crowdfunding Academy and peerbackers.com, will discuss how crowd-funding can help businesses at 11:30 a.m.

Tuesday at The Hanley Resource Center, 933 45th St. Crowdfunding is defined as the collective effort of individuals who pool their money, usually via the Internet to support efforts initiated by other people or organizations. Crowdfunding is used in support of a wide variety of activities, including startup companies and nonprofit fundraising. Cost: $20 Women's Chamber of Commerce of Palm Beach County members; $30 public; $40 at the door. Register online at www.womenschamber.

biz or call (561) 684-4523. Post staff reports. Beath Post ranging from a few hundred dollars to, well, if you have to ask. Stocks and divorce With the stock market still in New Year's celebration mode, a gentleman's thoughts turn to divorce, according to leading West Palm Beach matrimonial lawyer Jeffrey Fisher. Of course, it could be a lady's thoughts.

But either way, for couples who count their assets in the millions, splitting the pie in two is not such an easy task. Indeed, the dramatic rise in the stock market has posed a problem for executives trying to divvy up the spoils. On the one hand, rising asset appreciation makes the prospect of divorce less worrisome: During the past 90 days, Fisher said he's received an increase in the volume of calls to his office. "Everybody is feeling better about their financial stability and people who feel financial secure feel less insecure about dividing things in half," he said. But on the other hand, assets in the form of unvested stock options can Laura Green, 202-777-7090 Washington, Medicare igreenpboost.com Kimberly Miller, 561-820-4435 Real estate kmillerpboost.com Jeff Ostrowski, 561-820-4581 Economy, biotech jostrowskipbpost.com boosting total attendance from last year by 20 percent.

The show attracted its share of high-profile visitors, including "The Wolf of Wall Street" star Leonardo DiCaprio and his latest arm candy, model Toni Garrn. Diament reports DiCaprio spent three hours at the show and purchased an unspecified item. Dealers don't sell and tell, apparently. In any event, look for the November show to feature about 120 dealers of jewelry and watches, which are in high demand. Diament said it's because it's among the only types of jewelry a man can wear, hence the trend toward bigger (and heavier) time pieces.

This show also will feature a twist: Space for dealers to trade among themselves, as they also prepare for the holiday season. As for the February show, there will only be about 38 jewelry dealers, but dozens more dealers selling other items, including silver, porcelain, furniture and, of course, art. Diament assures there's something for everyone, with some items HAVE A QUESTION, TIP OR STORY? LET US KNOW. Call 561-820-4401. Charles Elmore, 561-820-4811 Insurance, general assignment celmorepbpost.com the multimedia 1 photography 1 video showcase of The Palm ClikHearlalmBeachPosticom.