COUNTY LAND REUTILIZATION CORPORATIONS: LAND BANKS
What is a Land Bank? • Land banks are public or community-owned entities created to acquire, manage, maintain, and repurpose vacant, abandoned, and foreclosed properties. • Created to replace systems where local governments sell their interest in tax- delinquent property to speculators, often for pennies on the dollar.
Legislative History • July 7, 2010 – Ohio’s 43 most populous counties (60,000 or more residents) received statutory authority to organize county land banks. • June 30, 2015 – Legislation amended to allow all counties to create land banks! • January 2018 – Delaware County Land Bank incorporated
CIC – ORC Chapter 1724 • Two types of community improvement corporations (CICs) that may be organized under ORC 1724.01(A)(1) • Land banks can file for an Internal Revenue Code (IRC) Section 501(c)(3) tax status, but IRC Section 115 is preferable. • IRC Section 115 organizations are commonly referred to as “instrumentalities of government” and do not have to file federal tax returns as do “C - 3” organizations.
Purpose - ORC Chapter 5722 • Facilitate the reuse of vacant, abandoned, and tax‐foreclosed real property • Efficiently hold and manage vacant, abandoned, or tax foreclosed real property pending its reutilization • Assist entities to clear the title of property and assist with coordinating and assembling properties • Promote economic and housing development in the county or region
Board of Directors ORC 1724.03(B) • Five, seven, or nine members • County treasurer • At least two county commissioners • Representative from county’s largest municipal corporation
Board of Directors (cont.) • Representative from township with population of at least 10,000, if at least two such townships exist in the county • Any remaining members selected by the treasurer and the board member county commissioners • At least one board member shall have private sector or nonprofit experience in rehabilitation or real estate acquisitions.
How Land Banks Get Properties • Tax foreclosure process – allows for direct transfer of property to a county land bank if the impositions, including taxes, penalties, special assessments and costs, are greater than the value of the property. • Property forfeited to the state – written request to the county auditor and paying for the cost of an “auditor’s deed” for the property.
Getting Properties (cont.) • Transfer of property from private individuals and probate estates when owner no longer desires the burden of owning worthless property – must be approved by county auditor. • Fannie Mae, HUD, & State- may provide demolition funds • Donation of non-delinquent properties
Ideal Properties • Already vacant – No demolition costs – Less environmental assessment costs – No building maintenance costs • Tax foreclosure – no private liens • Demolition costs included • End-user in place
Use of Properties • Transfer the properties to adjoining property owners – aka “side - lot programs” • Transfer the property to private sector for productive reuse • Convert property to public uses such as parks, playgrounds, urban agriculture or community gardening and beautification projects. • Transfer the property to non-profits, like community development corporations (CDCs), which may be assembling land for new development and/or maintain the property for community beautification goals
Primary Funding Source • Percentage of the biannual delinquent property tax receipts, aka “DTAC” (Delinquent Tax and Assessment Collection) • County Commissioners may vote to allocate up to 5% of all DTAC receipts to the county land bank for unrestricted use. • Ohio is only state to provide consistent funding to land banks.
Other Funding • Loans • Land sales • Charge fees and costs when disposing of property • Grant applications • Foundation funding
Current Priorities • Developing an inventory • Delaware County Historic Jailhouse
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