City Council unanimously passed legislation to create a land bank in the city.

The governing body approved a pair of ordinances during its regular meeting on Monday night following public hearings. The ordinances were introduced during the March 11 regular meeting.

The first ordinance (O-8-20) established a land bank and a second ordinance (O-9-20) designated the Redevelopment Agency as the entity to oversee the land bank. City Council was scheduled to introduce the ordinances at its January regular meeting but it was pulled from the agenda for more clarification.

“We see it as the next step of the foreclosure and abandoned property registry,” City Administrator and Redevelopment Director Robert Landolfi said during a brief interview after the January pre-conference meeting. The ordinance aims to address problem properties that continue to be neglected, which he estimated may be a dozen parcels continue to persist with problems.

 

“Difficult economic conditions coupled with the continued high rate of foreclosures have significantly increased the number of vacant, abandoned, neglected and other problem properties,” according to the ordinance. “Many vacant and abandoned properties, rather than being productively reused, remain vacant despite frequent changes in ownership, and create and continue to have a blighting effect on their surroundings.”

The land bank would “use available resources to facilitate the return of vacant, blighted, abandoned and tax-delinquent properties to productive use, thereby combating community deterioration, creating economic growth and establishing the housing market.”

“Land banks are governmental entities or nonprofit corporations that are focused on the conversion of vacant, abandoned, and tax delinquent properties into productive use,” according to the Center for Community Progress. At least 11 states have passed comprehensive state-enabling land bank legislation.

The state adopted legislation last summer allowing municipalities to establish municipal land banks. Steven Mlenak, a partner with the Roseland-based law firm of Greenbaum Rowe Smith & Davis, presented a session on the state’s land bank law during NJ Future’s annual redevelopment forum last month in New Brunswick.

The power of condemnation requires a showing of necessity, according to Mlenak, and land can’t be banked for an undecided purpose. The law was signed in July 2019, which was seen as a response to Glassboro v. Grossman, he said.

The January 2019 ruling “held that a municipality exercising its power of eminent domain to acquire private property, pursuant to the Local Redevelopment and Housing Law (LRHL) must establish that the property is ‘necessary for a redevelopment project.'” The municipality had tried to condemn property within a redevelopment area for an unspecified purpose as part an ongoing $450-million redevelopment that was not directly related but for future redevelopment purposes.

Land bank entities can hold, purchase, sell and lease properties, which are tax exempt when held by the land bank.

The ordinance stipulates that the land bank entity, in coordination with the city and a community advisory board, “will create, maintain, and make publicly available on its website, a database listing all current and former land bank properties, each owner of record since each property became a land bank property, and the sales price of each land bank property that has been purchased by the land bank entity on behalf of the city.”

In coordination with the city and the community advisory board, the
land bank entity shall incorporate into the online database:

• A list of all vacant and abandoned properties within the city;
• A mechanism to allow the public to offer suggestions concerning what
  properties should be labeled as vacant and abandoned; and,
• An interactive mapping component to allow the public to visualize the
  impact of land banking and the extent of vacant and abandoned properties
  within the city.

The land bank entity “shall provide an annual report to City Council and the public describing the properties being held by it as a land bank entity and the
activities that it carried out during the year as a land bank entity.”