Land bank would help with blighted properties

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The abandoned house at the corner of Mifflin Street and East 15th Avenue has been a problem for more than 20 years, Homestead Council President Lloyd Cunningham said Wednesday.

Some windows on the two-story house are boarded over, the small lot around it is overgrown and the borough‘‍s limited resources have left it unable to deal with the problem, Mr. Cunningham said.

But that will change soon.

Three councils of governments that serve 40 municipalities and 11 school districts in the Mon Valley and eastern suburbs of Allegheny County unveiled the business plan Wednesday for a regional land bank. The program, which must be approved by any municipality or school district that wants to participate, would begin operation next year and create an easier path to putting such properties back on the tax rolls.

Land banking is a new concept in Pennsylvania made possible through a bill approved by the state Legislature in 2012. Using a grant from the Heinz Endowments, paid executives with the Steel Valley, Turtle Creek Valley and Twin Rivers councils of governments worked with the Housing Alliance of Pennsylvania, local municipal leaders and property attorney-land bank expert Irene McLaughlin to develop the regional plan.

The cost of blight

Right now, Mr. Cunningham said, the only way the borough can force a sheriff’‍s sale on the property is if it has a prospective buyer in place. Otherwise, the borough ends up owning the property, a responsibility and liability it doesn‘‍t want.

Under the new program, the land bank will be able to acquire the property without paying delinquent taxes to the municipality, school district and county and hold onto to it while it looks for a buyer.

 “I think the really important part is land banks won’‍t wait for a buyer before they acquire the property,” said An Lewis, executive director of the Steel Valley COG. “”The land bank can acquire the property and hold it until there‘‍s a better use for it.“

Blighted property cause a drain on municipal services and reduce the value of properties within 150 feet by 15 percent, according to the business plan developed for the land bank.

Amanda Settelmaier, executive director of the Turtle Creek Valley COG, said planners have spent thousands of hours over the past two years working with municipal officials to build the business plan for the land bank. As a result, they expect favorable responses from many of them.

Braddock Mayor John Fetterman said he can’‍t wait to be able to use the land bank.

”I can‘‍t imagine a smarter thing to do for the region,“ Mr. Fetterman said. ”We need a comprehensive, uniform way to deal with vacant property.“

Allegheny County Executive Rich Fitzgerald has been a strong supporter of the concept, which Ms. Settelmaier said developed when officials were gathered for a Fitzgerald campaign event and realized they were facing the same problems with blighted property.

”To get the municipalities on board will be very positive,“ Mr. Fitzgerald said. ”People’‍s biggest investment often is in their homes and to lose 15 percent of the value because of other blighted property is very significant.“  

The nuts and bolts of how the land bank will operate:

The COG leaders will meet with elected municipal and school district officials through the end of the year and ask them to participate.It will begin operation in January with those communities that agree to participate, including anyone else across the county that is interested.

It will have a nine-member board with two members each appointed by advisory boards formed by participating municipalities and school districts; one appointed by Mr. Fitzgerald; three professionals such as real estate, planning and financial management experts appointed by the advisory boards; and a resident. Initial staffing will be provided by the COGs and could grow to include staff employed by the bank as its work grows.

The cost to government bodies will be minimal: 5 percent of their delinquent tax collections each year to help fund the program; elimination of overdue taxes on properties the bank acquires; and half the taxes for five years once a property is back on the tax roles. The COGs have applied for $1.5 million over three years from the Heinz Endowments as seed money to begin the bank.

In return, the municipalities will have an opportunity to get property back on the tax rolls more quickly and they will have absolute veto power over who can buy property from the bank.

”We don‘‍t want people to think this is a government land grab,“ Ms. Lewis said. ”It’‍s property they own, they manage and they decide how it will be used. Those individual voices are important and they will have the final say.“

Ed Blazina: or 412-263-1470.

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