Learn Polish: Mimo że to tylko bagno, podobno tam straszy. - Even though it is only a swamp, supposedly it is haunted there.

Podobno specifically marks hearsay. It means 'supposedly' or 'rumor has it,' indicating that the speaker heard this from someone else. If they had used najwyraźniej (evidently), it would mean they came to the conclusion themselves based on visible evidence, like observing spooky lights in the swamp.

Why is there no subject for the verb straszy?

Polish frequently uses the third-person singular verb straszy (literally 'it scares') as an impersonal construction to say a place is haunted. You do not need to provide a noun like a ghost to act as the subject. The phrase tam straszy simply translates as the general state 'it is haunted there.'

Could we drop że and just say mimo to tylko bagno?

No, because mimo (despite) acts as a preposition that must be followed by a noun or pronoun in the genitive case. Since to tylko bagno is a full clause with a subject and a verb, you must use the conjunction mimo że (even though / despite the fact that) to connect it.

If I wanted to say it was supposedly haunted there in the past, how would the verb change?

Because straszy is used as an impersonal construction here, you would put it in the third-person singular neuter form for the past tense. The phrase would become podobno tam straszyło (supposedly it was haunted there).