land banks can acquire, manage abandoned properties under new law

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land banks can acquire, manage abandoned properties under new law

July 9, 2010 [Dayton Daily News]

DAYTON — Although a new state law gives large counties power to take over vacant and abandoned properties, it will likely be close to a year before a land bank is up and running in Montgomery County.

The law, which went into effect Wednesday, July 7, expands a previous state law that applied only to Cuyahoga County and allows county treasurers to set up nonprofit corporations to acquire and manage abandoned properties that are a growing scourge on many neighborhoods.

The land banks, proponents say, will be able to act like businesses, take charge of abandoned properties — many of which are tied up in legal limbo — and redevelop or hold on to them until they can be returned to the market.

Montgomery County Treasurer Carolyn Rice, who helped get the law through the state Legislature, has begun meeting with a working group to study the financial side and has formed a community advisory group as a sounding board for ideas.

“I pledged early on in this process that we would probably start out small, but my vision is to eventually do a whole spectrum of activities,” Rice said.

The law allows counties with more than 60,000 residents to set up nonprofit land reutilization corporations to acquire, combine, demolish, redevelop or resell vacant and abandoned properties.

The legislation was written to give counties a great deal of latitude in setting up their land banks, said Lavea Brachman, director of the nonprofit Greater Ohio Policy Center, who worked to get the bill through the Legislature and has helped lead training workshops on land banks for government officials.

Different areas of the state have different problems, so the law gives them power to shape their own solutions, Brachman said. But the focus is taking control of abandoned properties that are often not maintained and drag down neighborhood property values.

Land banks given a wide latitude

The land banks can also demolish or rehabilitate buildings, combine vacant land into larger parcels that are more appealing to developers, she said.

Gus Frangos, president of the Cuyahoga County Land Reutilization Corporation, said it took his operation, which was specially authorized by the Legislature in April 2009, close to a year to get up and running at full speed. But the organization has now acquired more than 200 properties and has secured $41 million in federal Neighborhood Stabilization Funds to expand.

Many of the urban properties are headed for the wrecking ball, Frangos said, but others are being held or assembled into larger parcels and put back into use.

Frangos said the land bank is also helping outer ring suburbs with a number of issues that they can’t easily do as a government, such as clearing up property titles, combining properties for redevelopment or demolishing old commercial buildings.

Rice said she’s intent on putting together a land bank in the county that serves all types of communities, but wants to make sure the county doesn’t overextend.

“My sense of urgency is that the number of vacant and abandoned properties continues to grow,” Rice said. “So I don’t want us to wait around for the perfect organization. We need to move forward, but I don’t think we rush into something.”