Erie County’s land bank has received a windfall in the form of $2 million from the State Attorney General’s Office. The funds provide a huge boost to a worthwhile effort.
The Buffalo Erie Niagara Land Improvement Corp. is a nonprofit entity that banks foreclosed and abandoned properties.
The program has the potential to remake and renew blighted areas by rehabilitating rundown buildings and returning them to the tax rolls to generate income for local municipalities.
The money is part of more than $12.4 million that has been set aside for land banks in Erie and Chautauqua counties, along with Suffolk County, Rochester, Syracuse and Newburgh.
The grants represent the first round of competitive funding awards under the Attorney General’s Land Bank Community Revitalization Initiative. The initiative is a two-year, $20 million program supported by funds from last year’s $25 billion settlement with some of the nation’s biggest banks following the 2008 foreclosure crisis.
Protecting neighborhoods from further decline is certainly an appropriate use of foreclosure money. Attorney General Eric T. Schneiderman said: “In the aftermath of the foreclosure crisis, communities across our state have been burdened by vacant and abandoned properties that attract crime and drag down property values. By funding land banks across New York, we are helping empower local communities to rebuild their own neighborhoods, house by house, block by block.”
The infusion of state cash, added to a $100,000 appropriation from the county, will allow the group to hire staff and pay for the demolition of blighted properties. In addition, the money will help in the acquisition and rehabilitation of derelict properties and will allow the group to establish a revolving fund for future land bank operations.
Land banks can bid for properties at tax foreclosure auctions. However, they are required only to bid the amount equal to what’s owed in back taxes and fees on a property, after which they automatically become the property owner. Land banks do not have to engage in bidding wars with speculators to win an auction.
This promises to be a game-changer for neighborhoods hard hit by the economic woes of the past couple of decades.
An oft-cited example of the transformation that a land bank can accomplish is found in the city of Flint, Mich. There the Genesee County Land Bank Authority took title to 8 percent of the city’s land, amounting to 4,400 parcels, saving 1,354 families from foreclosure and taking over management of numerous properties at risk for abandonment.
It amounted to a $109 million return on the county’s initial land bank investment of $3.5 million, as quoted from the founder of the Flint land bank, Dan Kildee.
The hope is that the same results can be achieved here. The recent funding from the Attorney General’s Office makes that prospect more likely.