Presenting a live 90-minute webinar with interactive Q&A Using Municipal Land Banks for Urban Renewal: Structuring and Financing Land Banks, Partnering With Land Trusts WEDNESDAY, DECEMBER 14, 2016 1pm Eastern | 12pm Central | 11am Mountain | 10am Pacific Today’s faculty features: Brent O. Denzin, Partner, Ancel Glink Diamond Bush Dicianni & Krafthefer , Chicago Kristopher (Kip) Wahlers, Partner, Ice Miller , Columbus, Ohio The audio portion of the conference may be accessed via the telephone or by using your computer's speakers. Please refer to the instructions emailed to registrants for additional information. If you have any questions, please contact Customer Service at 1-800-926-7926 ext. 10 .
Tips for Optimal Quality FOR LIVE EVENT ONLY Sound Quality If you are listening via your computer speakers, please note that the quality of your sound will vary depending on the speed and quality of your internet connection. If the sound quality is not satisfactory, you may listen via the phone: dial 1-866-871-8924 and enter your PIN when prompted. Otherwise, please send us a chat or e-mail sound@straffordpub.com immediately so we can address the problem. If you dialed in and have any difficulties during the call, press *0 for assistance. Viewing Quality To maximize your screen, press the F11 key on your keyboard. To exit full screen, press the F11 key again.
Continuing Education Credits FOR LIVE EVENT ONLY In order for us to process your continuing education credit, you must confirm your participation in this webinar by completing and submitting the Attendance Affirmation/Evaluation after the webinar. A link to the Attendance Affirmation/Evaluation will be in the thank you email that you will receive immediately following the program. For additional information about continuing education, call us at 1-800-926-7926 ext. 35.
Program Materials FOR LIVE EVENT ONLY If you have not printed the conference materials for this program, please complete the following steps: Click on the ^ symbol next to “Conference Materials” in the middle of the left - • hand column on your screen. • Click on the tab labeled “Handouts” that appears, and there you will see a PDF of the slides for today's program. • Double click on the PDF and a separate page will open. Print the slides by clicking on the printer icon. •
From Vacancy to Vitality: Land Banks as Catalyst for Redevelopment December 14, 2016 Kip Wahlers Ice Miller LLP 250 West Street, Suite 700 Columbus, Ohio 43215 (614) 462-1074 Kip.Wahlers@icemiller.com icemiller.com icemiller.com
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 6 icemiller.com
Land Banks as tools for Revitalization Ohio Cities ravaged by foreclosure crisis At peak, over 100,000 vacant and abandoned homes statewide Recent Surveys by Western Reserve Land Conservancy show Vacancy rates of: 8% of all properties with structures in Cleveland (2015) 4% of all properties with structures in Akron (2015) 4.7% of all properties with structures in Sandusky (2015) 6 % of all properties with structures in Lorain (2013) 20% of all properties with structures in East Cleveland (2013) Adverse effects on neighborhood of vacant properties – crime, atmosphere, safety as well as lost revenues US Fire administration reports that over 12,000 vacant structure fires are reported each year 1993 Austin Texas study found that 34% of abandoned properties were used for illegal activities 7 icemiller.com
Benefits of Land Banks Source: 2014 Kirwan Institute for Study Race & Ethnicity, Ohio State University 8 icemiller.com
Benefits of Land Banks Promotion of economic development Strategic land assembly Blight clearance Expedited tax foreclosure Reduction of “flipping” of low value properties Stabilization of housing base Historic preservation Creation of funding sources for these activities Direct government support Arbitrage of penalty and interest on delinquent real estate Utilization of delinquent tax penalties and interest 9 icemiller.com
History of Ohio Land Banks Original county land bank law enacted in 2008; applied only to Cuyahoga County (Cleveland) Since that time law has been revised to provide for the establishment of land banks in all Ohio counties Patterned after land bank program in Genesee County, Michigan (Flint), established in 2004 In first 10 year of its existence, Genesee County Land Bank received 14,803 properties; nearly 75% of all tax foreclosures in the County. Sold 2,210 houses in total 1,759 on land contract to former renters and first time home buyers Average sale price of $10,135 Approximately $5 million received and invested in rehabilitating vacant houses. Source: www.the landbank .org/downloads/gclb_10th_anniversary_booklet.pdf 10 icemiller.com
Organizing Land Banks under Ohio Law Law, enacted in 2008, provided for creation of a land bank as one of two types of “community improvement corporations” (a private non - profit corporation) created under ORC Chapter 1724 An economic development corporation (traditionally referred to as a CIC) or A county land utilization corporation Entities organized under 1724 are not governments, but are created by and operate at the behest of, governments 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 Subject to Ohio open meetings and public records laws 11 icemiller.com
Mechanics of forming an Ohio Land Bank Board of county commissioners passes a resolution authorizing the formation of a land bank. County treasurer files articles of incorporation with the Ohio Secretary of State. After incorporation, county commissioners approve the corporation's operating documents. Board of Directors may be 5, 7 or 9 members At least two County Commissioners County Treasurer Representative from the county’s largest municipal corporation Representative from township with population of at least 10,000, if at least two such townships exist in the county Remaining members selected by the Treasurer and board member County Commissioners One board member must have private sector or non profit experience in rehabilitation or real estate acquisitions 12 icemiller.com
Special Powers of Ohio Land Redevelopment Corporations Revenue stream from delinquent tax penalties and interest This is a revenue stream that comes from the County Ability to contract with state and local governments for data storage, office space, etc. Can use county staff, in addition to or instead of land bank staff. Ability to direct the initiation of tax foreclosure proceedings Expedited foreclosure and sale process Lucas County Land Bank (Toledo) reports average of 165 days following expedited procedure to obtain title (as opposed to 2-3 years under standard judicial tax foreclosure) Automatic cleaning of title upon transfer (including tax liens) Ability to contact with local governments for property maintenance No transfer fees Property exempt from taxation while held by the corporation 13 icemiller.com
Immunities of Ohio Land Redevelopment Corporations RC 5722.22 protects land banks from state law liability for Underground storage tank laws (ORC Ch. 3783) Air pollution control laws (ORC Ch. 3704) Solid and hazardous waste and substances laws (ORC Ch. 3734 and 3751) Ohio EPA laws/regulations (ORC Ch. 3735) Voluntary action plans, emergency planning and cessation of regulated operations (ORC Ch. 3746, 3750 and 3752) Water pollution and water conservancy laws (ORC Ch. 6101 and 6111) Common law causes of action 14 icemiller.com
Funding Sources for Ohio Land Banks – Penalties and Interest/Tax Anticipation Notes General fund, grants from other subdivisions are authorized) Penalty and Interest on Delinquent Taxes ORC 323.121(B)(2)(a) allows County Treasurer to charge interest at a rate of 12% per annum - this can accrue monthly. County software may need to be modified for monthly accrual and assessment – in Cuyahoga County this was costly and error-ridden process Late payments of taxes may be advanced to applicable taxing districts (i.e. schools, cities) that are otherwise entitled to receive them (ORC 321.341), with penalties and interest from late or delinquent payments going to land bank. ORC 321.263. In order to fund these advances, delinquent tax anticipation notes may be issued by County Treasurer (this can be issued to capital markets or can be an internal borrowing). See ORC 133.082 15 icemiller.com
Recommend
More recommend
