Oakland County establishes land bank

OAKLAND COUNTY — A new Oakland County Land Bank was approved by the county’s Board of Commissioners at its June 23 meeting.

Land banks acquire properties that have been foreclosed and that no other buyers have been found for. They then sell, donate or develop the land, with the goal of turning the unwanted properties into something productive for the community.

Oakland County Treasurer Robert Wittenberg was a driving force behind pushing for the land bank, and his office currently handles tax foreclosed properties managed by the county.

“It boils down to being an economic development tool. It allows us to return properties to productive use. Properties can be turned around and resold or turned into a park or otherwise put back on the tax rolls,” said Wittenberg. “We think this will greatly benefit all of Oakland County, and we’re excited to see the difference it can make.”

Land banks acquire properties — most commonly through the tax foreclosure process— and transfer the properties to new, responsible owners in a manner consistent with community-based plans that also return the properties to the tax roll. For land bank properties, additional resources and funds may be available to help with infrastructure, roads and utility costs for economic development projects, including affordable and market-rate housing, along with commercial activities.

“We try to prevent foreclosure, which is a three-year process. If people still don’t pay what they owe on the property, the land is foreclosed,” Wittenberg explained. “We are required to put the property up for auction. Cities can decide to pay back all of the back taxes and delinquent fees and can decide to buy the property. If the city doesn’t want it, and it doesn’t sell at auction, then the land bank will be able to take it. We would then try to find buyers or developers for it. If there’s no interest, we might try to develop it as a community garden or something else positive for the community. … It also can assemble multiple properties that are near each other and sell it as a more desirable development opportunity.”

Oakland County was already overseeing several properties similar to how a land bank would, but without most of the benefits an official land bank would receive.

“We currently in our office operate a quasi-land bank where we have foreclosure properties and are required that the land goes to a land auction or sale,” said Wittenberg. “This means the property often doesn’t sell, and we end up owning and maintaining that property while it just sits there. We try to work with developers, but we are doing a lot of the work of land banks but missing out on the benefits, which statutes that involve land banks have, like tax incentives that come with an official land bank.”

Wittenberg stressed that there would be no conflicts with local communities if they wish to manage the properties instead. He added that no additional county funds will be used to finance the new land bank and that the goal will be to have the land bank eventually start paying for itself.

“To start with, there will be no additional funds. We already were operating a quasi-land bank through my office, so what was going toward that will now go toward the land bank,” he said. “We give local communities the right of first refusal on properties, so they can buy it first. What we buy is property that has no other interest in it. Once development begins, that land can be sold, and that can help fund further projects in the future. … Our goal won’t be to dictate what local communities do, but we want to help — via conversation with local leadership and residents — improve that city and ensure the communities are improved by fixing land that isn’t benefiting anyone right now.”

The Southfield Non-Profit Housing Corporation, which builds and maintains affordable housing for seniors, the disabled population and eligible families, has its own history in buying up properties in the city.

Mayor Kenson Siver, president of the SNHC’s board of directors, stated the organization has land bank properties for future development and that about 99% of them are vacant lots where a house used to be or was never developed.

“Some of them were foreclosed properties and some of them we outright purchased, especially if we own the adjoining properties,” he said. “Currently, we’re working on assembling a 12-acre parcel and we’re buying them.” He added he could not say where the parcel is located, as the SNHC still is closing on one of the parcels.

Siver said there are instances when they will sell a property the SNHC acquires.

“Some of them go to Habitat (for Humanity) to build affordable housing,” he said. “It depends on the area. We have two houses under construction now that we’re building ourselves with a contractor that are almost finished, and then some we’ve just outright sold to a builder.”

The Oakland County land bank requires several steps to officially establish and is expected to begin actively working on projects in early 2023.

“The resolution was passed and the county commissioners signed off on it. We are collecting the signatures right now, so we expect to complete that process (by the end of July),” said Wittenberg. “We then can sign off on bylaws and rules after the board members are finalized so the land bank will likely be up and functional in the fall. We will likely start working on properties early in 2023.”

Residential and commercial developers with projects in Oakland County can contact Jill Robinson, deputy treasurer and property specialist, at robinsonj@oakgov.com for more information on the topic.

Call Staff Writers Mike Koury at (586) 498-1077 and Brendan Losinski at (586) 498-1068.