The Pennsylvania Land Bank Resource Guide
A Housing Alliance of Pennsylvania Webinar
Presented by Winnie BrantonBranton Strategies LLC
April 15, 2016
Introduction and Acknowledgements
The Pennsylvania Land Bank Resource Guide is a self-help resource to assess whether a land bank is right for your community and, if so, how to proceed with planning, organizing and operating a land bank.
The publication will be released by the Housing Alliance at the Land Bank Summit on May 11 in Latrobe, PA.
Funding for the preparation and printing of the publication has been provided through the Claude Worthington Benedum Foundation.
Limited hard copies will be available, but the publication may be downloaded from the PA Blight Library, www.pablightlibrary.com.
Purpose of The Pennsylvania Land Bank Resource Guide To provide community leaders, county and
local government staff and elected officials with a self-help guide for land banks
To share the information gathered and insights gained from working with more than 40 communities across Pennsylvania to provide land bank training and technical assistance with funding from DCED
To build and expand on the Housing Alliance’s 2014 publication From Blight to Bright: A Comprehensive Toolkit for Pennsylvania
PA Land Bank Resource Guide
Section 1
• Overview of PA Land Bank Act and Land Bank Basics
Section 2
• Methods to assess whether your community might benefit from a land bank
Section 3• Guide for planning and organizing a land bank
Section 4
• Strategies for starting and operating a land bank
Section 5• Lessons learned and case studies
Section 1 Overview of PA Land Bank Act and Land
Bank Basics
Overview of PA Land Bank Act Act of Oct. 24, 2012, P.L. 1239, No.
153
68 Pa.C.S. §§ 2101-2120
Enables counties, municipalities with populations of 10,000 or more, and groups of smaller municipalities to create land banks Imag
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Why Was This Law Enacted? To enable communities to
systematically remove problem properties from an endless cycle of vacancy, abandonment, and tax foreclosure, and to return these properties to productive use.
To enable communities to systematically remove problem properties from an endless cycle of vacancy, abandonment, and tax foreclosure, and to return these properties to productive use Image source: Philadelphia Land Bank
Who Has A Land Bank?1. Dauphin County (excluding
Harrisburg) (May 2013)
2. Westmoreland County (December 2013)
3. Philadelphia (December 2013)
4. Pittsburgh (April 2014)
5. North East Pennsylvania Land Bank (June 2014)
6. City of Harrisburg (July 2014)
7. Venango County (August 2014)
8. Lackawanna County (June 2015)
9. Schuylkill County (December 2015)
10. Northumberland County (December 2015)
11. Washington County (March 2016)
What is a Land Bank?
A blight remediation tool
It’s a governmental entity whose single purpose is to convert vacant, abandoned and tax-delinquent properties to productive use.
Image Source: www.smartgrowthamerica.org
Why Land Banks? Proven tool for attacking
blighted properties Remove barriers to getting
problem properties back on the tax rolls
Uniform, predictable and transparent process
Central hub for blight prevention and remediation efforts
Photo credit: Julia Rowe via Flickr
Why Land Banks Are Important Change the market
dynamics of blight Address the high
cost of blight Harness the positive
economics of blight remediation
Who Can Create a Land Bank? Counties Municipalities with a
population over 10,000 Two or more
municipalities with combined population over 10,000
How is a Land Bank Created?
Created by ordinance and intergovernmental agreements
Filed with DCED and Dept. of State for incorporation
What Does a Land Bank Do? A land bank acquires, inventories, markets, holds, and transfers interests in real properties that are vacant, abandoned, and tax-delinquent.
The purpose is to rehabilitate or demolish the properties or get them into the hands of new owners who will improve them in accordance with the long term interests of the community and surrounding properties.
Who Runs the Land Bank?A board appointed by the land bank jurisdiction governs the land bank and may adopt bylaws.
5 to 11 members At least one member who is a community resident, not an
elected official, and a member of recognized civic association Subject to all sunshine and ethics laws Strong cross-over with Redevelopment Authority boards
Who Runs the Land Bank? Land banks may hire their own staff or contract for the use of current municipal employees. Land banks may staff municipal functions too.
One option: assign land bank-related responsibilities to municipal or county development agency staff that are already managing other real estate transactions—such as a redevelopment authority or housing authority.
What Local Conditions Favor Creating a Land Bank? Large inventories of vacant and abandoned properties Properties with little or no market value Properties with delinquent taxes that exceed FMV Properties with title problems Inflexible policies dictating the disposition of public property Speculation and uncertainty in auction sale of tax-foreclosed
properties
What Powers Does a Land Bank Have? “All powers necessary or appropriate” including Acquire, manage, hold and dispose of property With the approval of taxing authorities, discharge
or extinguish tax liens on property it owns Quiet title to property expeditiously But, no eminent domain power.
Property Acquisition Purchase Acquisitions/transfers from
municipalities Donations County repository for unsold
property Delinquent property tax sales
and enforcement
How Can a Land Bank Acquire Property at Judicial Tax Sale?A land bank may purchase a tax-delinquent property at the judicial tax sale (“free and clear sale”) through a negotiated agreement with the county tax claim bureau or other foreclosing taxing body, and without having to compete against other bidders at a public auction.
The land bank must give sufficient notice before using this power.
Hold Property Land banks may hold
properties long-term for strategic public purposes
Land bank property is exempt from state and local taxes Photo credit: Kellogg School of Business, Northwestern University
Extinguish Tax Liens Land bank may discharge liens on property it
acquires, subject to approval of the taxing authorities
Enables return to market of vacant and tax-delinquent properties with tax liens that exceed the value of the property
Expedited Quiet Title
Single complaint for multiple parcels Hearing scheduled within 90 days of filing Final judgment within 120 days of filing
Property Disposition Land bank must maintain a property inventory and make it
available to public Land bank may sell property for any amount and/or form of
consideration – as well as for any future use – it determines to be appropriate
No redevelopment agreement required Land bank must consider locally adopted land use plans Opportunity to foster equitable development
How Do We Pay For Land Banks? Because land banks deal with properties that no one else wants, it is rare that they are completely self-financing.
No funding provided in the Land Bank Act.
But, if the taxing authorities agree, a land bank may recapture up to 50% of property taxes collected on property conveyed by the land bank for up to five years.
Use existing capacity for staffing to minimize expenses.
How Do We Pay For Land Banks?Options: 5/50 Tax Recapture Grants and Loans Proceeds Contributions from Municipalities
Tax Sharing Provision in the law allows for sharing of real estate tax revenue with the land bank (up to 50%) when properties are returned to the tax rolls. Taxing authorities (municipalities, county, and school districts) need to agree. Sharing of revenue for a period of five years; after five years taxing authorities receive all of the revenue
Grants and Loans Keystone Communities Program Neighborhood Assistance Program PHARE (in Marcellus Shale areas) Gaming Local Share Account CDBG HOME Act 137 County Housing Trust Fund
Proceeds
A land bank may retain proceeds from property sales and leasing to fund its operations
Contributions from Municipalities General fund
appropriations Member fees In-kind assistance Properties
What Role Do Community Members Play?
Community participation on the Land Bank board
Public meetings and public comment
Transparency and accountability through public access to records and annual audit and report of activities
Section 2 Taking a Closer Look
Preliminary Assessment
Useful steps worth considering… Create a task force or working group Educate key decision-makers and constituencies
about land banks Gather and analyze relevant data and information Learn about the tax sale process, and review
results Explore and understand intergovernmental and
interagency dynamics Provide for substantial and meaningful public
involvement Make a preliminary needs assessment and
determination of feasibility
Will our community benefit from a Land Bank?
Section 3 Planning and Organizing a Land Bank
Land Bank Programming and Planning
Select the Land Bank jurisdiction Establish the Land Bank’s missions and goals Determine how the Land Bank will be
administered Determine the scope of program activities Coordinate with local planning and
development agencies Draft a strategic plan Draft a business plan with a budget Draft acquisition and disposition policies and
procedures
What will our Land Bank look like?
Organization Draft an Ordinance authorizing a
Land Bank Draft any necessary
Intergovernmental Cooperation Agreements
How do we form a Land Bank?
Building Support
Clearly define the problem and show how a land bank can help
Focus on the costs of doing nothing
Highlight the Land Bank’s partnership with taxing authorities
Share success stories from established land banks
How do we get this done?
Section 4 Setup, Startup and Operations
Setup and Startup
Incorporate and prepare bylaws
Organize your board Finalize and execute ICAs Create and approve
organizational policies
How do we get off the ground?
Operations
Contract for staff and services Procure necessary insurance
and professional services Create an inventory
management systemWhat do we need to operate?
Acquiring and Holding PropertiesAcquisitions are guided by the land bank’s acquisition policy -- how many and which properties to acquire.
Targeted and intentional
Most land banks will want to move properties quickly to new owners, avoid costs of holding and maintaining properties.
Discharging Liens and Clearing TitleTo convey property, a land bank must be able to offer clear, insurable title to potential buyers and redevelopers.With the approval of the taxing authorities, a land bank can discharge tax liens. A land bank can use the expedited process to quiet title to a property when necessary.
Disposing of Properties In accordance with local priorities (as set
forth in the ordinance or in the land bank’s disposition policy)
In accordance with other established criteria – pricing, qualified purchasers, redevelopment requirements
Consider local land use plans New housing, businesses, parks
Recordkeeping Keep minutes and
records of proceedings Annual audit of income
and expenditures and report of activities filed with DCED
Section 5 Lessons Learned and Case Studies
What Have We Learned So Far? Good data generates support
for a land bank Bring all partners and
stakeholders together as early as possible
Use already-available resources Be patient (but not too patient) Leadership matters
CASE STUDY: Westmoreland County Land BankFormer Monsour HospitalCity of Jeanette, Westmoreland County
CASE STUDY: Dauphin County Land Bank AuthorityTuscarora Street (Before)Susquehanna Township, Dauphin County
Tuscarora Street (After)Susquehanna Township, Dauphin County
CASE STUDY: Philadelphia Land Bank
ConclusionThe Pennsylvania Land Bank Resource Guide can help you: assess the power and potential of a land bank for your community and then, if you choose, move ahead with planning, organizing and
operating a land bank.We’ve included sample documents, such as ordinances, business plans, bylaws, budgets, audits and more that you can adapt and use.
For more on Pennsylvania Land Banks, please join us for the Land Bank Summit in Latrobe on May 11 and 12!
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