Last week the nonprofit LINC (Lighthouse Inc.) community revitalization group announced a major project in the Madison Square neighborhood, a place-making initiative that may, at long last, be a turning point for a neighborhood that has seen other such efforts slowly and painfully fail.
The Business Journal notes that LINC is among the nonprofits working with Kent County and the Kent County Land Bank Authority, which is one of the igniters, to get this project off the ground and provide promise.
LINC will develop 16 townhomes, financed by $3.2 million in Neighborhood Stabilization Program funds. The Business Journal reported last week on grbj.com that seven other townhomes, designed by Isaac Norris and Associates to be affordable and energy efficient, are still being built as Phase I of LINC’s larger community plan.
The Kent County Land Bank subcommittee decided last week to temporarily suspend its meetings until a pending legal case is settled. The suit is brought by critics of the land bank. In the face of such a holdup, the subcommittee reviewed its impact on neighborhoods as foreclosed properties are purchased by the land bank.
Executive Director Dave Allen noted 684 county properties had been foreclosed the past two years, a process that takes about five years. The Business Journal report on page 1 shows those foreclosures ultimately cost the county’s cities and townships an aggregate of $4.7 million in tax revenue, as nearly 10,000 homeowners lost at least 1 percent of their market value. The total loss in value was $14.7 million. Adding the tax loss to the value depreciation results in a negative economic impact of $19.4 million.
Allen also noted the land bank has preserved $973,000 in local property values and saved local units of government $308,000 in costs. The Community Research Institute study at Grand Valley State University shows that each vacant house decreases the value of 15 homes in a neighborhood.
While the rate of foreclosures has slowed, the county and individual governmental units are not likely to see much abatement for at least another two years.
Using a loan from the Grand Rapids Community Foundation, the Kent County Land Bank purchased properties during the tax auction and then sold them to nonprofits, including LINC, Next Step and Habitat for Humanity of Kent County.
It should be noted that the Land Bank Authority is composed of private sector professionals who represent each of the sectors serving the real estate market: the county treasurer, banking representatives, law firms, commercial real estate, Grand Rapids Association of Realtors and the Home and Building Association of Greater Grand Rapids. It is given oversight by those with learned expertise and has drawn support from concerned neighborhood associations. The properties in tax foreclosure have been available to the private sector for purchase well more than two years before tax auctions.
It is a program proving its value and should be given thanks.