RICHMOND -- Reeling from legal and financial challenges and mortgage industry-financed campaign attacks, backers of a plan that would make Richmond the first city in the nation to seize underwater mortgages using eminent domain are set to make a furious push for survival.
All the jousting leads to Tuesday's City Council meeting, where proponents will look to move forward with the unprecedented plan and opponents hope to kill it.
"We have the community on our side, ready to knock on doors and get the word out this weekend," Amy Schur, campaign director for Alliance of Californians for Community Empowerment, said Thursday. "The story is really one of big money versus grass roots."
Richmond and Mortgage
Assorted challenges have mounted in recent weeks. The city may not be able to refinance its municipal bonds and is being sued by banks on behalf of mortgage investors. Further, the city can't secure insurance protection to shield it from a potential court judgment if the plan is found unlawful.
Last month, millions of dollars in the city's bonds were inexplicably shunned by investors, leading some to speculate it was a fallout from the eminent domain plan.
Critics on the City Council have upped their voices, and the West Contra Costa County Association of Realtors has hired San Francisco-based public relations firm Barnes Mosher Whitehurst Lauter & Partners to wage a campaign against the plan.
"The city is in business with Wall Street financiers who want to use the power of eminent domain to profiteer at the expense of Richmond homeowners," said Chuck Finnie, a spokesman with the firm, which last year represented the soda industry in its successful effort to defeat a ballot measure to tax sugar-sweetened beverages.
Eminent domain proponents say Finnie and his firm are waging an expensive campaign of lies and deceit. A recent mailer paid for by the Realtors that went out to thousands of local homes said the city plans to "collude with Wall Street investors" in a plan that "would benefit only a tiny portion of the community, while simultaneously damaging the real estate market."
Finnie stood by the mailer Thursday, pointing out that deep-pocketed investors provide MRP the capital to refinance the seized mortgages, which would be adjusted to current market value and reduce monthly payments for homeowners.
For proponents like Schur, the mailer was an outrage.
"Outright lies and mischaracterizations," she said.
Both sides are set to come forward with agenda items at Tuesday's meeting, with Councilman Nat Bates expected to move to kill the partnership with MRP and Mayor Gayle McLaughlin countering with a proposal to bring eminent domain votes back at a later date.
Any vote to seize assets through eminent domain requires a supermajority of the council, per state law, meaning that five of Richmond's seven council members would need to agree.
Both sides have also turned to social media, creating dueling Facebook pages and Twitter accounts alternately portraying the plan as a life preserver for struggling homeowners or criminal theft that wipes out some investors to the benefit of others.
While MRP hoped to build momentum around the Richmond partnership, the edge might be tilting the other way.
The City Council in North Las Vegas, Nev., on Wednesday voted 5-0 to reject partnering with MRP, a move that came after months of back and forth by proponents and investment groups.
MRP Chairman Steven Gluckstern said Friday that rejection was "very disappointing news for the homeowners of North Las Vegas" but that he remains undaunted in Richmond.
"We're still a ways from condemning loans, but I am confident the mayor and council will move forward with the process," Gluckstern said. "On Tuesday, I will be there to ensure that people can hear the facts, not the gross misrepresentations" in recent ad campaigns.
Meanwhile, San Francisco Supervisor David Campos said in a news release Friday that he intends to introduce a resolution before the county Board of Supervisors expressing support for Richmond's plan, and instructing staff to explore opportunities in San Francisco to adopt a similar program.
A Monday night debate scheduled in Richmond to feature Gluckstern and local real estate officials has been called off because Gluckstern will not be in town that day, Gluckstern said.
What: Richmond City Council meeting
When: 6:30 p.m. Tuesday
Where: 440 Civic Center Plaza