Cuyahoga County Proposes Land Bank Program To Tackle Rising Number of Abandoned Properties
Safeguard Properties was mentioned in an article from DSnews.com which can be viewed here.
Cuyahoga County Proposes Land Bank Program To Tackle Rising Number of Abandoned Properties?
Carrie Bay | 07.16.08
Treasurer Jim Rokakis of Cuyahoga County, Ohio has developed a long-term redevelopment strategy to address the county’s growing number of abandoned properties. If approved by the state legislature, this initiative will enable the institution of Community Improvement Corporations with decentralized county governance, and it will allow counties to design individual plans that are tailored to meet the needs of their communities.
Land reclamation of vacant and abandoned properties has long posed a problem in urban areas, and the burgeoning foreclosure crisis has only amplified the problem. According to Cleveland-based Safeguard Properties, the city of Cleveland, within Cuyahoga County, will likely spend about $9,000,000 demolishing condemned properties and another $4,000,000 on the upkeep of vacant lots this year alone. Both costs are regressive expenses, meaning that demolished properties will then become additional vacant lots, all of which will require upkeep and maintenance year after year.
Under Rokakis’ plan for Cuyahoga County, a county-sponsored ?land bank? will actively address the abandoned properties problem by opening up much needed resources. Modeled on the success of the Genesee County, Michigan Land Bank, the proposed Cuyahoga land bank will have the power to acquire abandoned properties from banks, receive tax-foreclosed properties, maintain properties pending rehabilitation, prepare land for development, and demolish those properties with no residual equity. The land bank will have the authority to buy, sell and hold properties throughout Cuyahoga County.
Rokakis asserts that the land bank must be self-sufficient since other government funding cannot be assured. According to Safeguard, he has outlined three essential sources of funding for the Cuyahoga County land bank:
-Tax anticipation: The treasurer proposes to pay outstanding real estate taxes by borrowing the money from its daily balance, and allowing the land bank instead of the individual taxing districts to recapture the statutory 10 percent penalty and interest on delinquincies.
-Tax collection cost fund: A change in the Ohio Revised Code regarding treasurers’ fees on delinquent taxes would allow an additional 5 percent to be collected and slated for counties’ land banks.
-Bundling: Pending changes to the Ohio Revised Code, tax foreclosed properties will be auctioned in ?bundles?, to prevent speculators from picking up only higher equity properties and leaving behind the negative equity properties to escheat to the state. These bundles will then be used to help fund land bank operations.
Safeguard says Rokakis’ proposal is expected to make a noticeable dent in the number of structures needing demolition in Cuyahoga, minimize the immediate negative impact they have on the community, and hinder proliferating speculation and flipping of these properties.