Before the Treasury Department of Genesee County, Michigan, developed the Urban Land Reform Initiative, the county auctioned off tax-delinquent properties to investors. Most speculators would only minimally maintain these properties, and only so long as it was economically viable. Eventually, they often abandoned the land, valueless after years of refused maintenance. This practice gave rise to derelict neighborhoods throughout the county.
The Genesee County Treasury enacted land banking laws in 1999 as the initial component of its Urban Land Reform Initiative. These laws allow the county to tax foreclose on such properties after two or fewer years—before significant property devaluation occurs—and the state court to ensure clear title exchange. The model restricts the sale of property by speculators seeking personal profit. It also assists property owners with funds to maintain and manage tax-foreclosed properties. Genesee County has collected $7.2 million over the first five years of the Urban Land Reform Initiative through stronger enforcement of fee collection from delinquent taxpayers.
With revenues from delinquency fees and land sales, Genesee County replaced auctions of tax-foreclosed land with the Genesee Land Bank. Vested with the authority to acquire property through foreclosure, the Land Bank revives and redevelops land in accordance with the best interests and needs of the surrounding community. By the fall of 2006, the program had developed hundreds of units of affordable housing. It had also renovated numerous properties. Notably, it converted a four-story building in downtown Flint, which had been vacant for 25 years, into a new commercial and residential center. Genesee County has also exercised its control over the tax foreclosure process to assist 1,700 homeowners facing substantial financial hardship. The County Treasurer may grant foreclosure postponements to preserve homeownership and, ultimately, to support affordable housing.
Residents of Flint are not the only beneficiaries of the efforts of the Genesee County Land Bank. With the support of the Mott Foundation, the Land Bank has established the Genesee Institute, the purpose of which is to provide technical assistance to jurisdictions interested in establishing their own land banks. The Institute also provides consultation to surrounding communities on issues related to the management of vacant properties, sustainable neighborhoods, urban sprawl, and growth management. Five Michigan counties—Calhoun, Grand Traverse, Ingham, Jackson, and Saginaw—have implemented a Land Bank Authority based on the Genesee County model, and the Genesee Institute is working with cities across the nation to establish their own in land reform initiatives.
*This program was the winner of the special Fannie Mae Foundation Innovations Award in Affordable Housing.