Local homeowners have voluntarily donated 33 properties to the Hopkinsville and Christian County Landbank Authority in less than three years. The transfers have proven to be win-win situations; homeowners get to unload costly properties and inner-city development gets a powerful tool.

Mayor Dan Kemp sees the landbank primarily as a way to restore once blighted properties.

“Accumulated actual expenses related to back taxes, demolition of condemned structures, and remediation of property code violations make it impossible for the owners to sell or re-use some properties,” Kemp said.

Not only do such properties deteriorate into eyesores, but they also cease to contribute to the tax base. By extinguishing these debts, the landbank is able to remove barriers to new housing and commercial development that do generate revenue.

Getting properties back to productivity is the goal of all revitalization tools, Kemp said.

In addition to the landbank, the city uses housing incentives, beautification campaigns, and empowerment plans by neighborhood network associations to transform blighted blocks.

Dozens of cities, including Philadelphia, Indianapolis, Atlanta, Saint Louis and Louisville, have found landbanks to be essential ingredients in urban redevelopment.

Hopkinsville created its authority in late 2007 after local officials witnessed the impact of a nearby landbank. In the past five years, the Louisville-Jefferson County Landbank has distributed 600 formerly nonproductive properties to private developers, who then built more than 100 new housing units and numerous commercial and industrial facilities.

Community and Development Services Director Steve Bourne said that the trip convinced him private developers could be lured to the inner-city with the right incentives.

Not coincidentally, a bundle of rebates and low interest loans for new housing were approved last February by Hopkinsville City Council.  Now a developer, who builds single family homes on three or more contiguous lots in the four target areas, can save in a multitude of ways.     

The package offers 50-percent rebates on building permits, zoning permits, plat fees, sewer costs and payroll taxes. There are also fee waivers for utilities and certain kinds of design engineering, low-interest financing for building and sewer costs and free real estate advertising.

Because the incentives are funded through the Inner-City Residential Enterprise Zone budget, the housing must be built within the four ICREZ target areas to qualify.

These incentives “marry very well with the landbank,” Bourne said.

Even after builders are drawn to an area, the liabilities of its properties can still frustrate a deal. The landbank removes that final barrier by scrubbing a property of financial obligations, and sometimes, packaging it together with other properties for an even more attractive project.

CDS Planner Chris Covington, who handles much of the landbank’s legwork, says the process potentially can be completed within a matter of weeks.

A property’s first step into the landbank is usually a phone call from its owner expressing interest in donating their land. Covington then puts together a donation option agreement, which gives the landbank exclusive rights to the property within a 180 day window.

If the property owner signs on, Covington will analyze the land’s potential value. He takes photos onsite, pulls relevant information on the property and the surrounding neighborhood and packages everything into a presentation for the Landbank Authority.

The authority meets monthly. After Covington delivers his report, authority members vote on whether to accept the property. If they do, the authority’s attorney proceeds with the paperwork to transfer title and extinguish back taxes and any liens associated with the property.

As Covington recalled, one property in the Durrett Avenue area was acquired within three weeks from someone who relocated to Louisville and tired of the burden of maintenance. The speed of a transfer, of course, depends on the complexity of liens on the property and the timing of the authority’s meeting. But the city has streamlined the process for the convenience of both the original owner and the future developer.

The CDS office makes information on all landbank parcels readily available to the public via its website. Easy access is another key to attracting developers.

Louisville’s landbank functions as a clearinghouse. When a developer hears about an available parcel — often through the local homebuilders association — he can go directly to the Louisville Metro Housing Authority and get all the details he needs.

So too, CDS caters to local builders. Sometimes, developers come to the office already set on one particular property.

Bourne said CDS struck an agreement with one developer to sell a property near Eighteenth and Clay Streets for $1. The builder Lyndon Owens committed to putting up a new duplex to design standards in exchange for extinguishing a $17,000 lien on the old property.

Adjacent and nearby properties are carefully considered in each landbank transaction. If the city already owns several lots next to or in the same area as the property in question, the development potential increases. Properties bundled together are usually more enticing to a builder than those scattered here and there.

During his analysis, Covington will note nearby properties that are vacant or carrying liens. He’ll send out a letter to the property owner explaining the opportunity to donate to the landbank.

For more information on the landbank, contact Chris Covington at (270) 887-4285 or ccovington@comdev-services.com. 

An application for new housing incentives can be picked up at the Community and Development Services office at 101 North Main Street.