Pennsylvania Borough Considers Forming Land Bank
On January 22, newsitem.com published an article titled Mount Carmel considers land bank.
Mount Carmel considers land bank
MOUNT CARMEL – Piggy bank? What about pigsty bank?
The Mount Carmel Borough Council is considering forming a land bank system designed to turn trashed properties into treasure.
The borough council heard a presentation on land banking from Christopher Gulotta of the Gulotta Group, of Easton, at its work session Jan. 12. At its meeting Jan. 15, council members voted to send a letter to the Northumberland County Planning office indicating an interest in developing a land bank.
County Planning director Pat Mack said Gulotta is currently contracted with the state to provide consulting services for communities establishing land banks. For Mount Carmel, the Gulotta Group’s primary role will be to provide knowledge on establishing the land bank and building its business plan.
“He’ll give us guidance on what the land bank should do, can’t do,” said Mack. “He’s our technical help.”
Councilmember David Fantini, who also sits on the borough’s committee on code enforcement, planning and zoning, said if council opts to create a land bank, it will sign a five-year contract with the Gulotta Group. For its services, the borough will pay the company a percentage of the tax revenue from the flipped properties.
Legislation permitting the formation of land banks was passed in Pennsylvania in December 2012. Communities like Philadelphia, Harrisburg and Carlisle have already embraced the idea by establishing their own land banks while smaller communities have looked to create joint or county-wide land banks.
Mack said he hopes to build a multi-municipality land bank in Northumberland County with some of the most blighted communities as members. Coal Township and Shamokin have already signaled interest in joining such a venture, he said.
“Municipalities may not have the time to take or the manpower to undertake (major blight projects). The land bank would have that,” he said. “They’d have access to more grants and funding than a private person would.”
Land banking hinges on the broken windows theory – that if a building with a few broken windows is left unrepaired, vandals will be inspired to break more windows.
A single abandoned home left in disrepair will drag down the values of its surrounding properties, as well as the pride of the neighborhood. In contrast, properties repaired beyond the scope of their surroundings can positively influence neighboring property owners to invest in their own holdings.
A land bank allows a community to capitalize on these theories by focusing on eliminating blighted properties and bringing them back on the tax rolls.
“If you get it cleaned up, people take pride in their communities,” said Mack.
Fantini said the borough’s land bank would randomly buy a few blighted properties from the county repository at the judicial sale. The properties would be held for less than 18 months while the land bank renovates, rehabilitates or demolishes a structure to make the property more desirable.
“If they’re fixable, they’re going to fix them up and turn them into residential properties,” he said. “If they’re beyond repair, they’re going to tear them down.”
Because many of the lots in the borough are only 12 1/2 feet wide, many sites of torn down houses will be offered to adjoining property owners to bolster their properties.
Philadelphia offers similar opportunity for adjacent landowners to purchase certain blighted properties owned by the city for as little as $1. The buyer of a “side yard” is required to make necessary improvements to the property and is forbidden from selling the land for 10 years.
“It will make the (buyer’s) property value worth more,” said Fantini.
Mack said another possibility would be for the land bank to acquire multiple adjoining properties and consolidate them to sell to a developer.
Money from resold properties is reinvested into another set of blighted sites, generating a cycle of growth and repair.
Fantini said the initial upfront cost of the land bank makes it “a chance” but he likes the odds of it better than continuing to rely on private investments to increase tax rolls and improve the borough’s aesthetics.
“We have a lot of people that are buying up these blighted properties at the judicial sale,” he said. “They’re doing nothing with them and (the properties) are going right back into the sale again and they’re in worse shape.”
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