Goal
Reduce long-term vacancy and return troubled properties back to productive use.
Target
Owners of long-term vacant properties
Financing
Funding costs are shared between the municipality and the South Suburban Land Bank and Development Authority (SSLBDA).
Successes
9 properties have been deeded to the SSLBDA through abandonment petitions. Though it requires more investment up front, the acquisition of properties struggling with long-term vacancy will provide long-term benefits and cost savings for the Village and its residents.
Lessons Learned
- Collecting property information and maintaining records is critical when needing to prove that a property is abandoned.
- Assigning the Land Bank to be the deed holder allowed the Village to transfer liability to an entity that was better able to manage it.
- Having a clear end user in mind is critical.
Program background
The Village of Lansing currently has about 150 vacant single-family homes. Though its vacancy rate—between 1 and 1.5 percent—is lower than many other distressed suburban communities in the region, Lansing is no stranger to the destabilizing effects vacant property can have on a community’s well-being. The Village spends thousands of dollars maintaining these properties every year, and spends a considerable amount of resources tracking down owners and holding them accountable. In collaboration with SSLBDA and the Village attorney, building and planning staff have been using a petition process known as abandonment petitions to gain control of vacant properties, reduce strain on municipal resources, and attract investment.
How it works
The Village looked at a number of different criteria to determine which properties they would pursue. Since Lansing takes an aggressive approach to maintaining vacant and abandoned properties, building department staff were already collecting and tracking property information such as duration of vacancy, the amount of debt a property had, and why property owners owed money to the Village. Armed with this information, Lansing officials selected 11 properties that were causing persistent maintenance challenges, and decided to file abandonment petitions to gain control of the properties.
A property must owe back taxes or water bills in order to qualify as “abandoned.” Using water bills, code enforcement reports, and police reports, the Village determined that there were no responsible parties willing to step forward for the 11 properties they were targeting. All of these properties no longer had a lender involved—either because a property never had a loan or because a lender no longer saw potential in a property—and there were no signs of ownership interest. The Village filed legal notices informing interested parties of the intent to gain control of properties. When the public notice timeframe expired, the Village went to court in order to prove to the judge that the properties were abandoned and that in their current state, were a nuisance to the community. A judicial deed was granted to Lansing for 9 of the 11 properties. One of the properties not deeded to the Village was sold and is currently being fixed up, and the Village is still working with the owner of the other property who came forward after notice was filed.
Even before the abandonment petitions were filed, there was an arrangement between Lansing and the SSLBDA to have the properties deeded to SSLBDA. All partners involved agreed that ceding control of the properties to the SSLBDA would be the best course forward given the Land Bank’s experience managing distressed properties and its existing relationships with potential buyers. The Village and the Land Bank are working together to clean out properties and remedy any unsafe conditions. Since a property’s back taxes are wiped away when a judicial deed is granted, the SSLBDA has a lot more flexibility in selling the properties. Though they have had offers on some of the properties acquired, no end user has taken ownership of any of the properties yet. The Village and the Land Bank are regularly assessing the condition of the market to find the most appropriate buyers.
Lansing is in the process of putting together a second round of abandonment petitions. Scaling up proved to be a cost effective strategy in the first round of petitions. Legal fees and various hard costs associated with pursuing abandonment petitions were more manageable because partners worked with a cluster of properties, allowing processes associated with the abandonment procedure to be streamlined.