Policies Governing the Acquisition of Properties

 

The acquisition of properties by the Cattaraugus County Land Bank Corporation, herein referred to as ‘Land Bank’, shall be governed by the following basic considerations and factors:

 

• Annually, the Land Bank shall acquire, to the extent possible, the following types of properties in the following proportions:

 

Type A Properties –These are properties that show promise in terms of the potential impact for reconstruction or perhaps demolition. They may be highly visible properties, properties that are identified in a plan, they may be the worst property on a block that otherwise has a decent stock, they may have an unfortunate history, they may have good "bones"  (architecturally  speaking),  or  they  may  have  a developer who  is  interested in investing money into the project (an end game), but cannot afford to get into a bidding war as their future investment in the property will not make economic sense. These are typically foreclosed properties chosen prior to the auction.

 

Type B Properties –These properties may be undesirable in their current state; however, it is envisioned that with some attention they can be brought up to a state where they are attractive to a reputable developer. It is believed that a conservative investment in cleaning up the property, installing a new roof, etc., would make the property attractive for development. These properties are worth saving based on their location and bones, but may require some attention prior to sale. They may be properties that are selected prior to the foreclosure auction or were not sold at the foreclosure auction and are selected after the auction.

 

Type C Properties –These properties are the "worst of the worst" that may be acquired prior to the foreclosure auction, after the foreclosure auction or after the RFP sale. In most cases, the "C" properties with structures will be demolished and it is the intent that these properties will be granted over to the adjoining landowner or to other interests so that they can be put back on the tax roll.

 

• Proposals and requests by governmental, nonprofit and for-profit entities that identify specific properties for ultimate acquisition and redevelopment, which: a) act as catalyst for further    development; b) are part of a comprehensive development plan; c) support infrastructure, public and green space development; or d) reduce blight in the community. In particular, acquisition will be prioritized where the Land Bank participation is necessary to complete the redevelopment. In the case of municipal involvement, inter-local agreements (if required for development or maintenance) must be in place prior to acquisition.

• Properties located in reinvestment areas that would support strategic neighborhood stabilization and revitalization plans.
• Properties that meet the criteria for demolition, and such demolition will support blight elimination and neighborhood revitalization plans. This activity is contingent upon the funding available for the Land Bank to facilitate demolition and any partnerships that may involve matching funding, such as HUD CDBG funding.
• Properties that would form part of a land assemblage development plan by either the Land Bank or partnering entities. (e.g. Land Banking)
• Vacant, non-conforming, or undevelopable properties that could be placed into a Side Lot Disposition Program or support a planned development.
• Properties that may generate operating support for the functions of the Land Bank.
• Properties must be absent of any financial liabilities.
• The Land Bank must be aware of any environmental conditions. If any adverse conditions are determined, a remediation plan with secured funding must be in place prior to consideration for acquisition by the Land Bank.
• Properties that would allow for the creation or expansion of green or community space and urban gardens.
• Properties for which title issues are preventing the property from being developed to its highest and best use.
• Properties that have a designated end use in place prior to acquisition.
• Properties that are near schools, senior centers, or high visible areas that may pose safety issues to the community.
• All acquisitions shall be approved by the Land Bank Board prior to consummation of the transfer.  Any exceptions to the policies governing acquisition shall be approved by the governing body of the Land Bank for approval.
• The Board of Directors must approve all acquisition and disposition of Properties.
• Properties will be selected that support the mission of the Land Bank.
• Properties with adverse environmental conditions will not be accepted without a satisfactory funded plan for remediation approved by the Land Bank.
• The Land Bank will not determine the value of the donated property for the purpose of tax benefits, but will provide a letter describing the property donated.
• The Land Bank will not accept donated properties with a balance due to the County or local unit for outstanding property tax and/or liens.
• The Land Bank will accept properties that are located within targeted areas of interest.
• All donated properties must be approved by the Land Bank’s Board of Directors by a majority vote.

 

*Properties may be acquired through tax foreclosure; bank and mortgage foreclosure; donation; purchase.

Policies Governing the Disposition of Properties

 

This policy sets forth guidelines for the Land Bank’s disposal of real and personal property in accordance with the mission and purpose of the Land Bank and all applicable law.  The disposition of properties shall be based upon a combination of two different factors: 1) The intended or planned use of the property, and 2) The nature and identity of the transferee of the property. The disposition of any given parcel will be based upon an assessment of the most efficient and effective way to maximize the benefits of an aggregate of the identified policies and priorities. The Board and Staff of the Land Bank shall at all times retain flexibility in evaluating the appropriate balancing of the priorities for the use of the property, priorities as to the nature of the transferee of properties, priorities concerning neighborhood and community development and methods for how properties will be marketed to potential transferees. Pursuant to Section 2896 of the Public Authorities Law, the Chairman shall be the Contracting Officer of the Corporation.

 

General Duties:

 

The Land Bank Shall:

• Maintain adequate inventory controls and accountability systems for all property owned by the Land Bank and under its control; Periodically inventory such property to determine which property may be disposed of; Produce written report and transfer or dispose of property as promptly as possible.
• Publish, not less frequently than annually, a report listing all real property owned by the Land Bank.  Such report shall consist of a list and full description of all real and personal property disposed of during such a period. The report shall contain the price received by the Land Bank and the name of the purchaser for all such property sold by the Land Bank during such a period; and
• Deliver copies of such a report to all agencies requires by law including the Comptroller of the State of New York, the Director of the Budget of the State of New York, the Commissioner of the New York State Officer of General Services, the Director of the Authority Budget Office and the New York State Legislature (via distribution to the majority leader of the senate and the speaker of the assembly)
• Maintain and make available for public review and inspection a complete inventory of all real property dispositions by the Land Bank.  Such inventory shall include a complete copy of the sales contract including all terms and conditions including, but not limited to, any form of compensation received by the Land Bank or any other party which is not included on the property disposition inventory establishes within one week of disposition.  Such records shall remain available for public inspection in the property disposition inventory indefinitely. 

 

 

 

Type of Use of Properties

 

• Owner-occupant  housing
• Mixed owner-occupant and rental housing
• Side lots for transfer to adjoining landowners
• Development of public green space (parks and gardens)
• Mixed use development
• Supportive housing
• Commercial retail
• Commercial Office
• Parking

 

Nature and Identify of Transferees

 

• Individuals or families who can demonstrate that they will own, rehabilitate and occupy the residential property for a given period of time.
• Reputable, experienced and qualified real estate developers, partnerships, limited liability corporations, or joint ventures comprised of a private nonprofit corporations and a private for-profit entity.
• Reputable landlords or qualified real estate investors (unless they have judgments against them during the past 5 years regarding a landlord/tenant issue).
• Qualified nonprofits corporations that will hold title to properties on a long-term basis (primarily rental properties) or hold title to the property for purposes of subsequent redevelopment and re-conveyance to private third parties for homeownership.
• Local government entities that will use properties for a public purpose.
• Businesses that will own and occupy commercial properties.

 

 

General Land Disposition Policies

 

In determining the requirements for property disposition by the Land Bank, the following considerations shall be made. These policies pertain to the transfer of property that may be improved or unimproved.

 

• Individuals and entities that were the prior owners of property at the time of the tax foreclosure which transferred title to the County shall be ineligible to be the transferee of such property from the County.
• The transferee must not own any real property that: a) has any un- remediated citation or violation of the state and local codes and ordinances; b) is tax delinquent; c) was transferred to a local government as a result of tax foreclosure proceedings.
• All tax incentives and financing necessary for the development to be completed must be committed for the development prescribed in the development agreement prior to actual disposition.
• Options to purchase real estate may be available for a specified percentage of the purchase price with a negotiated time frame to be determined by the Land Bank. This fee will be credited to the parcel price at closing. If closing does not occur, the fee is forfeited. All option agreements are subject to all policies and procedures of the Land Bank pertaining to property transfers.
• A precise narrative description of future use of the property is required. The future use must be in-line with local development plans. The development agreement shall apply to stated use.
• The proposed use must be consistent with current zoning requirements or a waiver for non-conforming use is a condition precedent to the transfer.
• Transactions shall be structured in a manner that permits the Land Bank to enforce recorded covenants or conditions upon title pertaining to development and use of the property for a specified period of time.
• Any non-local residents or entities with a local agent may acquire Land Bank property only with an enforceable plan to place the property into immediate productive use (meaning the property is to be occupied immediately or with the immediate commencement of some form of development project that fits the stated mission of the Land Bank). This applies to all real property.
• Any exception to the policies governing disposition shall be taken to the governing body of the Land Bank for approval.
• If code or ordinance violations exist with respect to the property at the time of the transfer, the development or transfer agreements shall specify a maximum period of time for elimination or correction of such violations, with the period of time be established as appropriate to the nature of the violation of the anticipated redevelopment or reuse of the property.
• Preference will be given to local entities for the transfer of properties.
• Land Bank will require potential transferees to submit a plan that includes, at a minimum, the following:

1. Project Description that includes ultimate use of property
2. Development Schedule
3. Investment Plan including purchase price of property and projected development costs
4. Experience of Transferee in undertaking similar projects
5. References

 

Policies Governing Development Agreements

 

In an effort to ensure that development occurs on property transferred by the Land Bank that is consistent with the agreed upon development, and on a reasonable schedule, the Land Bank will require that each property transfer be subject to a development agreement.

 

Each development agreement will consists of the following components:

1. Project Description
2. Development Scheduled
3. Financing Structure
4. Enforcement Mechanism

 

Each development agreement will be drafted by the Land Bank and signed by both the Land Bank and the transferee at the time of transfer.

 

Side Lot Disposition Program

The Land Bank shall develop a Side Lot Disposition Program that encourages the transfer of lots to the contiguous land owner or other entities that will maintain the property, put it into productive use, and pay taxes on it.  In determining the requirements for property disposition as Qualified Properties, parcels of property eligible for inclusion in the Side Lot Disposition program shall meet  the following the minimum criteria:

 

• • The property shall be vacant unimproved real property.
  • Properties shall be contiguous to adjacent owner-occupied residential or commercial property owner.
  • Land Bank shall sell or grant properties to adjacent land owners as determined by the Board of Directors.
  • The Intended use of the lot is to be disclosed prior to the transfer of the property.
  • The transfer shall include a deed restriction requiring the use of the property to be consistent with the stated use.
  • The transfer shall include, where it is adjacent to the prospective new owner, a deed restriction requiring the side-lot property be combined with their lot.
  • Land Bank shall work with County to sell vacant properties directly from the County to adjacent property owners, and Land Bank shall pay all or a portion of the closing costs.

 

Transferees

• • All transferees must hold title on the contiguous property. The transferee must not own any real property (including both the contiguous lot and all other property within the county) that is subject to any un-remediated citation of violation of the state and local codes and ordinances.
  • The transferee must not own any real property (including both the contiguous lot and all other property in the county) that is tax delinquent.
  • The transferee must not have been the prior owner of any real property that was transferred to the County or to a local government as a result of tax foreclosure proceedings ten years prior to the disposition.

 

Pricing

• • Properties sold as a side lot to an adjacent owner shall be set at a specific price established by the Land Bank, inclusive of all recordable fees.  Title insurance is not included in the sale price.

 

Additional Requirements

• • In the event that multiple adjacent property owners desire to acquire the same side lot, the lot shall be transferred to the property owner who has the largest percentage of common boundary line with the subject side lot.
  • In the event that multiple adjacent property owners (with the same percentage of common boundary line) desire to acquire the same side lot, the lot shall either be transferred to the highest bidder for the property, divided and transferred among the interested contiguous property owners, or transferred to the property owner that the Land Bank Board feels is most capable of managing and maintaining the property.

 

Policies Governing a Homeownership Program

 

The following additional policies shall apply to properties to be transferred to individual transferees as part of a homeownership program.

• The owner-occupant must complete renovations and move into the structure with in a time frame negotiated by the Land Bank.
• The property may not be used solely as rental property (may be owner-occupied with rental).
• For properties transferred for cash consideration below full fair market value of the property, the owner-occupant must reside in the property as his or her primary residence for at least a 5-year period. If the property is sold prior to the 5-year period, the transferee must   either:

a) Sell the property for no more than the purchase price from the Land Bank plus all cost of property improvements; or b) Repay the Land Bank the difference between the purchase price and the initial fair market value.