Whats A Land Bank?

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November 19, 2012 by Zee

I was asked to comment recently about an official stance on land banking in Philadelphia on behalf of Fight Philly Blight for an article in Philadelphia Neighborhoods blog by Plan Philly.

It was more difficult than I anticipated in quantifying a centralized viewpoint, and the differences revolved around how the program would be implemented.
The overall consensus within Fight Philly Blight and from local civics and non-profits is that a land bank can and could be a great thing for Philadelphia.

Government owned land banks tend to be positively motivated, but can often have ‘side effects’, that controversially exploit its structure and direction for development.

time to renovate
Let’s face it, blight is damaging; the smaller scale work that Fight Philly Blight does such as park and block cleanups, community event giveaways, discussion meetup groups and blogging about social issues and legislation all have their place in the fight against community degradation, but a land bank is a BIG way the city could make further development even more efficient.

The citizen coalition Take Back Vacant Land and PACDC have amassed 30 plus buy-in signatures from premier non-profits in the region, for land banking and the bill has moved along largely without mention of the potential controversy, which I find curious and surprising.

To understand the controversy we must first understand what a land bank is.
A plan of the city and environs of Philadelphia

Historically land banks were owned by private investors who would buy up swaths of undeveloped land and sell them piecemeal at the price of speculative development.

This encouraged community development to halt as large companies bought and held land in anticipation of someone else beginning the investment, in addition there are companies in the UK and Australia that were indited for scamming and pyramid scheming.

These contributed to the negative reputation of land banks (which I think reflect more on capitalism than the concept but that’s another blog).

Government owned land banks use a similar structural concept, but without the whole ‘inuring private benefit’ non-prof buzz-clause.

In fact, government owned land banks step in when the private market is unwilling. In Philly, the land bank in almost any form would be a marked improvement over flawed highest bidder method; which favors negative investment even further with its complex system, multiple agencies, unclear liens and soft property tax recoupment practices.
Checkbook Cover Opened
The great thing about the Philadelphia land bank bill (number 120052) and the cluster of related bills including 120054 on revamping tax collections, and bill 110921 on development districts, in addition to recent changes to simplify zoning;

is that they are bipartisan and was introduced to the PA state legislation by Rep John Taylor.

The land bank, in theory, would enable us to streamline services; start from scratch with a new system that was available online, had real time information and more property updates.

It promises to clear titles; thus boost the supply of insurable properties, repackage parcels for a more attractive sale, and offer the real estate for nominal rates if developed within a certain time frame.

Katz's Deli

It sounds great, right? well bust out your magnifying and lets examine how this is all supposed to be accomplished…

Onto: Implementing a land bank


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