Public Entity. The Erie Land Bank (hereinafter, “ELB”) is a public entity operating as authorized by City of Erie Ordinance 29-2016, in accordance with Pennsylvania Act 153 of 2012 (68 Pa.C.S. §2101 et seq.), and Bylaws duly adopted by the Erie Land Bank Board of Directors.
The purpose of ELB is to effectively facilitate the return of blighted, abandoned, and functionally obsolete properties to productive reuse through creative leadership that engages key partners to leverage a variety of resources.
Adoption. These Administrative Policies and Procedures have been considered and adopted by the ELB Board of Directors, and may be amended by the majority vote of the ELB Board of Directors at a publicly scheduled and noticed meeting.
Sources of Property Inventory. Sources of real property acquisitions of ELB include, but are not limited to, the following:
(a) Transfers from other government entities;
(b) Acquisitions by ELB at tax or mortgage foreclosure auctions;
(c) Market purchases;
(d) Donations from private entities;
(e) Conduit transfers contemplating the simultaneous acquisition and disposition of property.
Policies Governing the Acquisition of Properties. Properties may be acquired through one of two methods: a “standard acquisition” by ELB for future disposition to an undetermined end user; or 2) a “conduit transfer”, in which ELB acquires a property for transfer to an identified end user. In determining which, if any, properties shall be acquired by ELB, ELB shall give consideration to the following factors:
(a) Proposals and requests by the City of Erie, or City-related entities/authorities that identify specific properties for ultimate acquisition and redevelopment, which (i) act as catalyst for further development; (ii) are part of a comprehensive development plan; (iii) support infrastructure, public and green space development; or (iv) reduce blight in the community. (a) Proposals and requests by the City of Erie, or City-related entities/authorities that identify specific properties for ultimate acquisition and redevelopment, which (i) act as catalyst for further development; (ii) are part of a comprehensive development plan; (iii) support infrastructure, public and green space development; or (iv) reduce blight in the community.
(b) Referrals from the City of Erie Blighted Property Review Committee.
(c) Proposals and requests by private and nonprofit corporations that identify specific properties for ultimate acquisition and redevelopment.
(d) Improved properties that are appropriate for demolition of the improvements.
(e) Vacant properties that could be productive as part of a municipal revitalization or economic development program.
(f) Properties that would be in support of strategic neighborhood stabilization and revitalization plans.
(g) Properties that would form a part of a land assemblage development plan.
(h) Properties that will generate operating resources for the functions of the ELB.
In the case of an offer to donate a property to ELB, all of the above factors shall be considered, as well as those described in paragraphs 2.4 and 2.5 below. The acceptance of all donated properties must be approved by a majority vote of ELB’s Board of Directors. ELB will not determine the value of the donated property for the purpose of tax benefits, but will provide a letter describing the property donated.
Process for Acquiring Properties. A transaction agreement must be executed by ELB and the grantor of any property to be acquired by ELB, except in cases when ELB acquires the property at a mortgage or tax foreclosure sale. A transaction agreement must be executed by ELB and the grantor of any property to be acquired by ELB, except in cases when ELB acquires the property at a mortgage or tax foreclosure sale.
Prior to the execution of an agreement of sale to purchase a property, ELB staff shall prepare an underwriting agreement that will:
(a) Determine that the purchase is consistent with paragraph 2.2 above.
(b) Determine if clear title can be conveyed by the transferor to ELB (see paragraph 2.4 below).
(c) Determine if there are any environmental or structural issues that should be resolved prior to the purchase by ELB (see paragraph 2.5 below).
(d) Reasonably estimate the costs of any required demolition or rehabilitation and identify the source of funds to be used for such demolition or rehabilitation.
(e) If the property is not available for nominal consideration, determine a fair value of the property consistent with these Policies and Procedures.
In the case of conduit transfers, such a transaction agreement will generally be in the form of an Acquisition and Disposition Agreement prepared in accordance with these Policies. ELB staff will create transaction agreements in the form and content as deemed by ELB to be in the best interest of ELB, and shall include to the extent feasible specification of all documents and instruments contemplated by the transaction as well as the rights, duties, and obligations of the parties.
Acquisitions by ELB at a judicial tax sale shall be conducted in accordance with Act 153 of 2012, Section 2117(c)(3), and an Intergovernmental Cooperation Agreement between ELB and Erie County.
Title Insurance. In acquisitions of property by ELB through standard purchase agreements, ELB generally requires a certificate of title based upon a full title examination and a policy of title insurance insuring ELB subject to such outstanding title exceptions as are acceptable to ELB in its sole discretion. In those circumstances when the title is not insurable, ELB may elect to acquire the property with the intention of initiating a quiet title action.
Environmental Concerns. ELB reserves full and complete discretion to require in all transaction agreements that satisfactory evidence be provided to ELB regarding the status of environmental contamination as defined by federal or state law. At a minimum, seller shall complete a disclosure noting any known potential environmental issues.
Community Improvement Purposes. In transferring properties to organizations or individuals, ELB shall keep in mind community improvement purposes with:In transferring properties to organizations or individuals, ELB shall keep in mind community improvement purposes with:
Neighborhood and Community Development Considerations. As indicated above, ELB reserves the right to consider the impact of a property transfer on short- and long-term neighborhood and community development plans. In doing so, ELB may prioritize the following in any order in which it deems appropriate:
Definitions. “Property Costs” shall be defined as the aggregate costs and expenses of ELB attributable to the specific property in question, including costs of acquisition, maintenance, repair, demolition, marketing of the property and indirect costs of the operations of ELB allocable to the property.“Property Costs” shall be defined as the aggregate costs and expenses of ELB attributable to the specific property in question, including costs of acquisition, maintenance, repair, demolition, marketing of the property and indirect costs of the operations of ELB allocable to the property.
“Transfer Closing Costs” shall be defined as all costs incurred by ELB in the conveyance of the property to the transferee, including but not limited to transfer taxes, legal fees, filing fees, notary fees, title fees, etc.
“Transaction Fee” shall be defined as a fee paid by the transferee of the property at closing in the amount of 2% of the selling price, but not less than $750.
The consideration to be provided by a transferee to ELB may take the form of cash, deferred financing, performance of contractual obligations, imposition of restrictive covenants, or other obligations and responsibilities of the transferee or any combination thereof.
Process for Conveying Properties. The disposition of properties shall be based upon a combination of two factors: (a) the intended or planned use of the property, and (b) the nature and identity of the transferee. The disposition of any given property will be based upon an assessment of the most efficient and effective way to maximize the benefits of an aggregate of the related policies and priorities. ELB shall at all times retain flexibility in evaluating the appropriate balancing of the priorities for the use of the property, priorities as to the nature of the transferees, priorities concerning neighborhood and community development, and methods for how properties will be marketed to potential transferees.
The process for conveyance of a property from ELB to another entity shall include a completed application from the proposed transferee and an underwriting report prepared by ELB staff that verifies that the applicant is qualified consistent with the provisions of paragraph 4.9. A Disposition Agreement shall be prepared by ELB staff that includes terms and conditions for the reuse of the property.
The Land Bank is not obligated to convey any property and reserves the right to decline to proceed with any proposal or application for any property at any time. The approval of an application for transfer of a property is at all times at the sole discretion of the Land Bank's Board of Directors. The Land Bank reserves the right to pause or terminate the conveyance process for any property at any time and for any reason.
Options. Purchase options are available for 10% of the parcel price for up to a six-month period with extensions at ELB’s discretion. This fee will be credited to the purchase price at closing. If closing does not occur, the fee will be forfeited. ELB will assess a fee for extensions to the option agreement; said fee will not be credited against the purchase price. All option agreements are subject to all policies and procedures of ELB pertaining to property transfers.
Deed without Warranty. All conveyances from ELB to third parties shall be by Quitclaim Deed.
Covenants, Conditions, and Restrictions. All conveyances by ELB to third parties shall include such covenants, conditions, and restrictions as ELB deems necessary and appropriate in its sole discretion to ensure the use, rehabilitation and redevelopment of the property in a manner consistent with the public purposes of ELB. All conveyances by ELB to third parties shall include such covenants, conditions, and restrictions as ELB deems necessary and appropriate in its sole discretion to ensure the use, rehabilitation and redevelopment of the property in a manner consistent with the public purposes of ELB.
Development Agreements. In an effort to ensure that suitable development or rehabilitation occurs on property conveyed by ELB, and on a reasonable schedule, ELB will require that each conveyance be subject to a development agreement. Each development agreement will consist of the following components:
Transfers to Governmental Entities. (a) To the extent that transfers of property to governmental entities are designed to be held by such governmental entities in perpetuity for governmental purposes, the aggregate consideration for the transfer may, at the discretion of ELB, consist of the “Property Costs” and “Transfer Closing Costs” to be paid in cash as well as a deed restriction concerning the use of the property.
(b) To the extent that transfers of property to governmental entities and authorities are anticipated as conduit transfers by such governmental entities to third parties, the aggregate consideration for the transfer may, at the discretion of ELB, consist of not less than “Property Costs”, “Transfer Closing Costs”, and “Transaction Fee” to be paid in cash. Depending on the nature of the end use of the property by any third party, ELB reserves the right to sell the property for fair market value plus all fees and costs referenced above.
Transfers to Other Entities. In the case of transfers of property to non-government entities, other than side lot transfers described in Section 6, the aggregate consideration for the transfer may, at the discretion of ELB, consist of not less than the “Property Costs”, “Transfer Closing Costs”, and “Transaction Fee”, to a maximum of the fair market value of the property as determined by ELB plus all costs and fees. Non-monetary consideration, such as in-kind services, that fulfill the mission and goals of ELB may be considered.
Transferee Qualifications. All entities seeking to enter into Acquisition and Disposition agreements with ELB will be required to provide, as part of an application process, such information as may be requested by ELB, including but not limited to (a) the legal status of the entity and its organizational and financial structure, (b) its prior experience in developing and managing real property, and (c) an affidavit indicating that there are no delinquent real estate taxes on other properties in which the entity has an ownership interest.
ELB reserves full and complete discretion to decline acquisition and/or disposition requests from individuals and entities that meet any of the following criteria:
Delegation of Authority. The ELB Board of Directors may delegate disposition authority to ELB staff (whether hired directly by ELB or contracted through another agency) except in the following circumstances where the Board of Directors is required to approve or deny the disposition by formal action:
Requirements and Conditions. The majority of properties ELB will acquire will be vacant. However, in the event that ELB acquires a property through tax/mortgage foreclosure or other means, and that property serves as the primary place of residence for an owner-occupant, ELB will make best efforts not to displace the owner-occupant and establish payment plans for any delinquent liens acquired by ELB. When feasible, ELB may offer to lease the premises to the prior owner-occupant at fair market value for a period not less than six (6) months. The residence shall remain the household’s primary residence throughout the lease period.
Side Lot Transfers. ELB may, at times, have ownership of unimproved parcels of land (whether acquired without improvements, or having been cleared by demolition). These unimproved parcels may be eligible for transfer to the owner of a contiguous property, as described within this policy. Eligibility of any specific property to be conveyed by the Side Lot Disposition Program is subject to override by higher reuse priorities of ELB.
Qualified Properties. Parcels of property eligible for inclusion in the Side Lot Disposition Program shall meet the following minimum criteria:Parcels of property eligible for inclusion in the Side Lot Disposition Program shall meet the following minimum criteria:
Side Lot Transferees. All Side Lot Disposition Program transferees must meet the following minimum qualifications:All Side Lot Disposition Program transferees must meet the following minimum qualifications:
ELB will accept written offers from qualified owners of contiguous parcels for the purchase of ELB properties made available for conveyance through the Side Lot Disposition Program. ELB has established the following formulas to calculate the minimum offer which would be considered:
In addition to the offered consideration, the transferee of any property conveyed through the Side Lot Disposition Program would also be required to pay all “Transfer Closing Costs”, as defined in paragraph 4.1.
Additional Requirements. The following shall also apply to all real estate conveyances made through the Side Lot Disposition Program:The following shall also apply to all real estate conveyances made through the Side Lot Disposition Program:
Requirement. ELB will make its services available to other Erie County municipalities based on a negotiated Intergovernmental Cooperation Agreement between ELB, the municipality desiring ELB services, and the affected school district.
Sequence for Negotiations. ELB will negotiate an Agreement with the municipality first, and together the two parties will engage the school district. ELB will only negotiate with a school district in partnership with the municipality.
Fees. The municipality will pay an initial fee of $1,000.00 to help offset ELB’s administrative costs in developing the intergovernmental cooperation agreements. ELB will assess a transaction fee of $500 for each property intervention requested by the municipality. Other fees may be assessed as deemed necessary.
Policies Relating to Agreement. The Intergovernmental Cooperation Agreement will include a Resolution by ELB for policies relating to the specific terms of each Agreement. Those policies may be negotiated on a case-by-case basis without affecting the content of these Administrative Policies and Procedures.