Cook County Land Bank aims to help towns beat blight
BY DAVID ROEDER Staff Reporter September 3, 2013 6:24PM
Cook County Board President Toni Preckwinkle (left) and Cook County commissioner Bridget Gainer talk about how they are establishing a Cook County Land Bank to take over vacant or foreclosed property during a meeting Friday morning at Chicago City Hall. | Michael R. Schmidt-For Sun-Times Media
Updated: October 5, 2013 6:09AM
The Cook County Land Bank is nearly open for business, and if it works, assumptions about the power of local governments to combat urban blight might have to change.
The land bank is supposed to help Chicago and the suburbs take vacant or neglected property and make it productive or at least a community asset. It would acquire property, get rid of back taxes and liens and make it fit for a responsible buyer.
Cook County Board President Toni Preckwinkle and Commissioner Bridget Gainer (D-10th) have pushed the land bank from idea toward inception. With an eye on successful land banks in other locales, they are working with a volunteer board that is preparing the operation for launch.
It’s a new public agency but real estate is its business. Can it be nimble and smart enough for a market that has humbled developers and left homeowners upside-down on their mortgages?
“This is going to be a dicey proposition,” Preckwinkle said. “It’s going to take a lot of work and effort and not a little luck to make it happen. We hope that it’s going to be self-sustaining in the third year or so.”
The land bank would work with Chicago’s City Hall, but it could be most active in low-income suburbs that have little ability to deal with problem properties. Preckwinkle and Gainer said they’ll count it as progress if targeted areas think of vacant land as an opportunity instead of a liability.
But they also delineate what the land bank cannot do:
◆ It will be a development partner but not an all-powerful planning agency. “It’s not going to be another urban renewal kind of clear-out project,” Gainer said.
◆ It’s connected to county government, but it won’t be a bureaucracy or have its own taxing power or line item in the budget. It will have to sustain itself from its investments.
◆ And the land bank can’t be a panacea or a dumping ground for property.
For now, the land bank is running on $6 million in seed money from Illinois Attorney General Lisa Madigan, part of $100 million the state received from a national settlement with banks over mortgage and foreclosure fraud. Of that award, the county is sharing $1.5 million with a similar land bank being started by the South Suburban Mayors and Managers Association.
Preckwinkle said that with limited funds for investment, the land bank will have to concentrate on where it can have the most impact. She said she hopes its 15-member board will hire an executive director late this year. The first property transactions could come early in 2014, but Preckwinkle emphasized that the initial deals must be judged carefully.
The land bank also has gotten $149,000 from the Chicago Community Trust and is seeking other donations and foundation support.
Madigan said the money for the land bank was the largest single grant her office has bestowed.
“Government is usually constrained by funding,” she said. “This will allow the land bank to do innovative yet strategic development work. It gives it an opportunity to compete in the marketplace while having a long-term concern for community impact.”
The bank could invest in all types of property. Commercial or industrial sites promise the splashiest payback in jobs or tax revenue, but officials also hope to attack vacant and foreclosed homes.
After the residential market malfunctioned and homes were abandoned, Gainer began advancing the land bank as an answer. The foreclosure flood in the county court system has abated somewhat, but Gainer said it can still take two years to get a title transferred.
The delay discourages investors and leaves neighborhoods dealing with a legacy of decay. Gainer said the land bank could short-circuit the process while encouraging areas to think of other uses for the property besides housing.
A report by the Woodstock Institute showed that through the first half of 2013, 13,405 properties in Cook County were in foreclosure, down 40 percent from the same six-month period in 2012. The number of filings remains higher than what was normal before the housing collapse late in the last decade.
Gainer, whose district covers the North Side lakefront and Northwest Side, said urban agriculture, parks or commercial development are possible in places where there’s little demand for housing.
“We have an entire legal, zoning and political infrastructure around more buildings, more housing, more development, but we’ve never figured out a way to look at declining demand for housing other than community failure,” she said.