Case Study: A new way to manage vacant properties and land
Background
In 2011, the city and state created the Detroit Land Bank Authority to streamline the management and sale of local governments’ stock of vacant structures and lots and in response to the city’s tax foreclosure crisis. Prior to the Land Bank’s creation, Wayne County, the City of Detroit, and departments within the city all owned properties that were managed with little coordination. As families faced financial strife, the numbers of properties being managed by local governments were growing quickly.
The Detroit Land Bank Authority (DLBA) is a public authority that owns and manages approximately 100,000 parcels of property in the city City of Detroit, making it the city’s largest landowner.
The Detroit Land Bank Authority’s (DLBA) mission is to return the city’s blighted and vacant properties to productive use.
Since 2014, DLBA has sold 8,000 houses, demolished over 20,000 structures, and sold over 14,500 side lots. The DLBA:
| Acquires & Sells Property | Supports Home Ownership | Property Maintenance and Occupation |
| Most frequently acquires property via the Wayne County tax foreclosure auction. Works directly with individual buyers, as well as Community Partner organizations and developers for projects big and small. | Special sales programs such as selling side-lots for $100 and home auctions starting at $1,000.The Buy Back Program where individuals living in DBLA owned homes have an opportunity to purchase themMakes sure the title is clear before sale. | Maintains, sells, or demolishes properties unbid on from Wayne County.Requires renovation and occupancy of sold properties within six6 months.Acts as a code enforcement agency. |
The DBLA does not have the power to exercise eminent domain (transferring private property to public use) or condemn property.
“The goal is to get houses renovated and to get people living in them. Of course, maybe there are some challenges for certain buyers, but I don’t think any program would ever be perfect and have a perfect outcome for every single participant.”
– Alyssa Strickland, DBLA 2019
The DBLA is closely tied to the City of Detroit government. Four of the five members of the DBLA’s board are appointed by the Mayor. And while the DBLA operates separately from the City of Detroit with its board for oversight, a significant amount of its funding comes from the City of Detroit (as well as from Federal sources focused on urban development). As a public authority, the DBLA’s board holds public meetings and follows the Open Meetings Act.
Controversies
There has been criticism and controversy surrounding the land bank, some of which is founded and others which are speculation. Most commonly the organization has been accused of showing favoritism, threatening to seize homes it doesn’t own, not selling to ‘regular’ Detroiters, and misusing its resources.
Favoritism
- Criticism: Some members of Detroit’s community believe city employees aren’t held accountable to the DBLA’s guidelines on ownership which require showing progress toward rehabilitating and occupying the homes.
- The Other Side: Discount programs designed to attract city employees and teachers to live in Detroit offer lower rates on DBLA homes to these individuals. Requirements for occupancy are the same as standard programs.
Not Selling to “Regular Detroiters”
- Criticism: Comparisons between the numbers of properties owned by the Land Bank to those being sold has led to further skepticism of the organization’s motives.
- The Other Side: DBLA programs include those to sell as well as revitalize properties. Its job is to find the best ways to move properties from public ownership so that public dollars can be used for other needs. And as an independent entity, it designs and manages its systems to do so.
- Some members of Detroit’s community believe city employees have been shown favoritism and aren’t held accountable to the DBLA’s guidelines on ownership which require showing progress toward rehabilitating and occupying the homes
Misusing Resources
- Criticism: In 2019, the agency shifted its resources to focus on high-demand neighborhoods
- The Other Side: Blight programs often debate the best approach to stabilizing neighborhoods–is it best to direct resources to areas where a neighborhood needs to be almost entirely rebuilt in order to have an impact or best to first address neighborhoods that can be stabilized quickly and have a positive impact on surrounding areas?
- Offering nuisance abatement programs to houses that weren’t purchased from the DBLA while properties currently owned by DBLA are in need of maintenance.
| “The city and state’s decision to create an authority that’s at a distance from voters is partly behind the general sense that the agency isn’t accountable,” the city’s Ombudsman, Bruce Simpson said. “Any time a function that’s providing a city service is placed in an authority…there’s a distance between municipal government and the authority, and that distance does not lend itself to oversight,” he added. |
Progress, Planning and People
The DBLA has continued to look for ways to sell properties while working with the City of Detroit and, where possible, meeting the needs of Detroiters. In 2015, the DBLA launched the Occupied Buy Back program to facilitate home ownership for Detroit residents. Individuals whose homes were foreclosed or renters whose landlords were out of compliance with taxes and in danger of foreclosure, have the opportunity to purchase the homes back from DBLA.
Between 2018 and 2020, the city’s Planning and Development Departmentplanning and development department conducted planning processes in some neighborhoods, and asked the DBLA to freeze sales on property in those areas.
The DBLA has also looked for ways to expand its discount programs to other targeted groups such as those in the skilled trades.
What’s Next?
As of 2019, the DBLA had hired a new CFO, Reginald Scott II who will be responsible for shepherding the authority through an audit. The DBLA’s relationship with the City of Detroit has also changed, since it is no longer a demolition contractor for the City and is now focused as a planning partner. According to local news, the DBLA is looking to continue identifying new programs and methods for selling land including seeking support from banks to offer mortgages to owners and offering properties for sale in bundles (or more than one property sold together). The mission and purpose of the DBLA remains: find ways to sell and revitalize Detroit’s vacant properties including houses and sidelots. “So really, it’s how do we make the Detroit Land Bank more accountable?” Councilmember Sheffield asked in a Detroit News article. “Or, how do we dismantle that current structure, because currently it’s not working for the average citizen?”
Questions
- Why does the city need a seperate public Land Bank Authority?
- How can the Land Bank be more accountable to Detroiters?
- What is the role of community engagement with non-governmental agencies?