The city is moving closer to establishing a “land bank” that supporters say would help move derelict properties back onto the tax rolls. Mayor Steve Noble said he’s also exploring a more ambitious program to establish pockets of affordability in rapidly gentrifying neighborhoods.
On Aug. 1, the Kingston Common Council signed off on legislation allowing the city to seek an official designation from the state for a local land bank. The idea of a land bank dates back to 2015 during the administration of Mayor Shayne Gallo when the council voted to move ahead with the plan. But the plan languished until January 2016 when Mayor Steve Noble appointed a five-member interim board of directors to draw up bylaws and carry on the authorization process. The council vote clears the way for the appointment of a permanent nine-member board and the land bank’s designation as a 501(c)(3) nonprofit.
A land bank is a quasi-governmental organization operating independently, with a volunteer board appointed by city officials. The bank’s mission is to acquire delinquent properties, including those held by the city for back taxes, and ready them for sale. The land bank typically holds the property for between three and five years while they clear the title, carry out necessary repairs and upgrades and seek a suitable buyer. The property remains off the tax rolls while it’s in the hands of the land bank, but when the property is sold, the city is refunded all back taxes owed. (The remainder of the proceeds goes to the land bank to fund future projects.) While land banks can sell properties to the highest bidder, Noble said Kingston’s proposed land bank would likely aim to sell the homes at a discounted rate to families making between 50 and 80 percent of the Area Median Income. That’s in line with Noble’s stated goal of stabilizing low-income neighborhoods by moving residents out of rental housing and into affordable owner-occupied units.
“I think it can be a valuable tool in our toolbox as we try to create sustainable development,” said Noble of the land bank.
The bank has already identified three tax delinquent city-owned houses at 33 and 44 Franklin Street and 54 Van Deusen St. that it plans to acquire, refurbish and sell. The rehabilitation and other work will be carried out using $195,000 of a $500,000 state grant acquired by the city to address housing issues. Proceeds from the sale of the homes will serve as seed money for further acquisitions and renovations.
“After that initial round of grant funding they should be able to live off of the returns on the houses that they sell,” said Noble.
Land banks operate in a number of New York communities, and have grown in popularity since the 2008 financial crisis left cities and towns littered with decaying foreclosed and abandoned properties. Another idea being promoted by Noble, a community land trust, would be more ambitious in purpose. While land banks simply move blighted properties onto the open market, a community land trust takes on the role of long-term stewards of homes with the goal of maintaining affordability in perpetuity. There is currently a non-profit Kingston Land Trust (Where Noble once served as chairman of the board of directors) that’s focused on acquiring and preserving open space in the city. KLT Executive Director Julia Farr is expected to discuss the community land trust concept with members of the city’s Community Development Advisory Board on Aug. 29. Farr said her board was talking about whether the KLT might be able to shift into the role of a community land trust.
“It’s something we’re discussing,” said Farr. “Whether that is a role we could take on in the future.”
A community land trust can acquire property through purchase on the open market or donations. Unlike a land bank, community land trusts typically do not handle rehabilitation or clearing titles to distressed properties, instead focusing on acquiring viable market-ready parcels. When the trust sells a building, they retain title to the land beneath it. The dual-ownership model allows the trusts board of directors to have a say in, for example, how much the property can be sold for at a future date or what the owner of a commercial or residential rental property can charge tenants.
“The goal is so that you don’t have someone who buys a house and then flips it or speculates on it in a way that you forever lose its affordability,” said Noble.
Supporters say community land trusts can help stem the tide of gentrification — the process by which rising land prices drive long established residents and businesses from neighborhoods — by creating pockets of affordability throughout a city. The trusts also help create stability in neighborhoods by discouraging house-flipping or rapid tenant turnover by investors seeking maximum profit.
Farr said a community land trust could create “anchors” of affordable housing and commercial space at strategic locations around the city. The trust could also help alleviate concentrations of poverty by making affordable housing available in neighborhoods that would otherwise be out of reach for poorer residents. In Burlington, Vt., the nation’s largest community land trust holds an interest in some 3,000 units of residential and commercial property.
“A community land trust can be a valuable tool for equitable development,” said Farr. “It can help stabilize a neighborhood or an entire city.”