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Land bank statement

The Michigan Legislature’s recent passage of six land bank bills has some Detroit community leaders rejoicing. “Hallelujiah, hallelujiah, hallelujiah!” exclaims John George, executive director of the Motor City Blight Busters.

The new laws, enacted last month, are expected to vastly improve how Detroit manages its massive inventory of abandoned and vacant property.

“We have long advocated for a land bank,” says George, who heads the Detroit nonprofit organization that develops low- and moderate-income housing in blighted neighborhoods. He says a land bank will give his group and other developers the ability to assemble land for housing projects and ensure that titles are clear.

A land bank would amass Detroit’s 40,000 or so abandoned and vacant properties into blocks and sell them to nonprofits and other developers, as well as cut through bureaucratic red tape that has been a factor in keeping many parcels fallow for decades. It would clear titles, forgive old tax and utility bills, and return parcels to tax rolls, growing city revenue.

The land bank also could sell land for much less than the market value. City policy had required that land be sold for market value, making it unaffordable to nonprofit and low-income housing developers.

According to the Planning and Development Department, about 1,100 properties were sold last year for a total of $3 million.

George says that his group has been trying to purchase vacant land across from Blight Busters’ community center in northwest Detroit for years.

“We can’t get the land,” says George, who wants to build six low- and moderate-income homes on the property. “We would have six new homes on Orchard Street, but to date there are none.” George says city bureaucracy has thwarted his efforts. But he believes the land bank will make it possible for him to purchase the land and other property.

The land bank laws “remove legal impediments for the redevelopment of government-owned, tax-reverted [city-seized] property,” says Peter Wills, spokesperson for state Rep. Gene DeRossett, R-Manchester, who co-sponsored the bills.

Wills says the new laws enable land banks to get low-interest loans and other funding.

Many agree that DeRossetts’ legislation, which empowers cities, counties and the state to create land banks, will change the face and future of Detroit.

“I think we are headed in the right direction,” says Barbara Washington Bass, executive director of Community Development Advocates of Detroit (CDAD), an association of more than 100 nonprofit developers and affiliate organizations.

“The whole focus will be making sure the land sales will move at a faster rate. And if we can ensure that, we save dollars and resources, and we will see our city flourish as a result of that,” says Bass.

Bass is pleased that the legislation enables government entities to tailor land banks to their specific needs.

“It allows for individual cities to form their own policies for how they would implement land use within their own cities. For Detroit, that is exactly what we wanted,” says Bass.

Cities such as Cleveland and Atlanta provided a framework for Michigan’s land bank law, says state Rep. Chris Kolb, D-Ann Arbor, who co-sponsored the key land bank measure.

“What we were hearing from a lot of developers — and community development folks as well — is it was difficult to assemble the properties you need in a timely matter,” Kolb says. “… This was one way cities and states around the country had dealt with tax-reverted properties, and this approach made sense for Michigan.”

Kolb says he supports the land-bank concept because the banks help redevelop inner cities.

“I have been active in land-use issues and want to redevelop urban areas with the infrastructure to handle development,” he says. “Otherwise, we will develop green field sites and create more sprawl.”

Getting it right

It is not the first time that legislators proposed land bank bills. In 2002, several were debated and voted down. Some supporters of the current land bank laws opposed the previous legislation because it would have given Detroit Mayor Kwame Kilpatrick full rein over city real estate.

“The real stumbling block was mayoral control of it,” says Kolb of the previous legislation.

The previously proposed legislation would have given Kilpatrick the power to appoint the land bank board and dispose of property, with no input from the council or public.

The mayor’s office did not return a call for comment.

Detroit City Council president Maryann Mahaffey, who supports the current land bank laws, opposed the previous legislation.

Under the original bills, she says, “The mayor was the only one who could set it up and appoint the board and disperse property without coming to the council. [The bills] didn’t take into full account the concerns of local neighborhoods or their right to determine their own future.”

Mahaffey and others were miffed that the 2002 proposals allowed every community in the state — except Detroit — to set up a land bank authority as it saw fit; Detroit was mandated to let the mayor call the shots.

“Detroit was treated differently than every other community in the state,” says Mahaffey, who joined other critics to successfully lobby against the bills.

State Rep. Steve Tobocman, D-Detroit, who had concerns about the former land bank bills, strongly supports the new legislation. But he fears that the city could drop the ball.

“In terms of Detroit, I’m concerned it might be another opportunity they let slip by, and it’s up to those most committed to see stressed property and tax-reverted property put to productive use,” says Tobocman.

He says that some are suspicious of the land bank.

“There was mistrust bred by the last legislative attempts,” says Tobocman. “There are those who understandably think the land bank is a power grab. But we created a framework that doesn’t allow anyone to do that because the mayor has to get council to agree on the system.”

Exactly what form that system will take is not yet clear.

“Now we have to develop the plan for Detroit and we have had staff working on that already,” says Mahaffey.

“It should be a collaborative effort with the community, council and administration.”

The City Council is seeking input from neighborhood development groups.

The mayor’s office is working with nonprofits on the issue, says Bass, whose group met with the administration in December and is scheduled to do so again next month.

Ann Mullen is a Metro Times staff writer. E-mail amullen@metrotimes.com

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