R2019-135 Resolution Authorizing Agreement-Central Illinois Land Bank Authority

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September 12, 2019 T0: Mayor&City Council Members FROM: Scot Wrighton, City Manager Ray Lai, Directar of Economic&Community Development RE: Disposition of Surplus Properties via Land Banking One of the neighborhood revitalization strategies recently approved by the City Council is the use of a land bank, or an alternative land trust,to manage the hundreds of small tracks the city has acquired through foreclosure,demolition and tax sales, and the properties the city is about to acquire from Macon County— known as the Macon County Trustee lots. In total,these properties number more than 800 parcels. If the city forecloses on additional demolition liens, and/or accepts additional properties from Macon County,the total will increase further. There are several options for managing such a large volume of miscellaneous lots spread all over the city: 1) internally manage a land trust with city staff or coordinate parcel disposition through outsourced land agents acting on behalf of the ciry; 2) create a land bank as anticipated by Illinois law and transfer most of the lots ta this new entity for disposition; or 3) join with an existing regional land bank. Because several cities in Illinois have become the owners of derelict and/or abandoned land,the State of Illinois has sought to incentivize the creation of land banks (especially regional land banks) with grant funds administered by IHDA. Land banks possess most of the real estate-related powers of local governments, including the ability maintain land,demolish structures, and to buy and sell improved and unimproved land.The city of Springfield was unsuccessful in their efforts to create a viable land bank, and had to return grant funds,They are using other strategies to manage their land inventory. Some other cities have tried to manage their own land banks with different levels of success.The most successful land banks in Illinois are regional consortiums that spread their administrative and overhead costs over multiple jurisdictions. One of these land banks is the South Suburban Land Bank&Development Authority, headquartered in Tinley Park. It is a 7-year old consortium of more than 30 local governments using the services of a common staff. Their mission and statement of purpose is: The South Suburban Land Bank and Development Authority will facilitate the redevelopment of acquired properties through strategic partnerships with developers, community organizations, lenders, and locai governments to improve quality of life, stabifize the tax base, and enhance economic activities that promote sustainable, healthy, and stable communities in a manner consistent with local gavernment plans and priorities.