‘Blanket Approval’ Resolutions Can Help Land Banks Expedite Real Estate Transactions

(December 2018) Since 2008, the National Community Stabilization Trust has worked with land banks around the country to ensure responsible disposition of vacant properties. Land banks are local government entities or nonprofit corporations with the authority to repurpose vacant and abandoned properties for more productive use. Often, they can function as a more community-friendly alternative to tax lien sales and public tax auctions.

Currently, there are around 170 land banks in different states that operate at varying levels of capacity and efficiency. Land banks, especially those that are recently formed, often have a small staff and lack robust funding, which is why NCST and many of our partners – such as the Center for Community Progress, Enterprise Community Partners, and the Local Initiatives Support Corporation – work with them to provide resources and technical assistance.

One specific area where we have provided technical assistance relates to challenges posed by lack of acquisition approval authority. Land banks are generally formed and given legal authority by state and local legislative bodies, and thus vary in the degree of autonomy that they have with the property acquisition process. A number of the land banks that we work with are legally required to seek approval from their board or other governing body for each property they wish to acquire. Given that most governing bodies meet infrequently (e.g. monthly), their lengthier timeline is often incompatible with navigating the deadline-driven nature of real estate acquisition. A land bank may lose its chance to close a deal if it must wait several weeks for the next meeting to get through the layers of required approval.

To address this problem, we work with our land bank partners to get ‘blanket approval’ from their governing body for our standard contract language by drafting a resolution that grants authority to an Executive Director or Chair to accept and execute agreements for properties. This process eliminates or reduces the need to get board approval each time and thereby improves the land bank’s chances of acquiring more properties. Our land bank partners that used to have long timelines exceeding 30 days per property just for the governing body approval process have been able to trim that down to 1-3 days for getting approval from their Director or Chair.

This type of local policy work takes time and a bit of creativity, but we believe that it is worth the effort. Land banks are a tremendous asset to their communities. We value their contribution and look forward to continued collaboration to build more capacity for the future.

 

If you are a land bank that would like assistance with developing a resolution or if you would just like to learn more about these ‘blanket approval’ resolutions, please contact Theo Chang on our Policy team (tchang@stabilizationtrust.org) or Jordan Backstrom on our Operations team (jbackstrom@stabilizationtrust.org).

 

Theo Chang serves as a Senior Policy Associate for NCST.