County to decide land banks fate this week

July 6, 2012
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Whether the Kent County Land Bank Authority will be able to help Algoma Township officials find a suitable buyer to complete the unfinished and tax-foreclosed Cedar Rock Business Park should be decided this week.

Kent County commissioners are scheduled to vote Thursday on whether to sell 64 properties the county foreclosed on in April to the land bank for about $480,000. The vote was to have been taken June 28, but was postponed so commissioners could hold a question-and-answer session about the land bank with County Treasurer Kenneth Parrish, who founded the bank, and the agency’s executive director, Dave Allen.

Selling the properties to the land bank would keep the parcels off the auction list for the public sale in August.

Commissioner Michael Wawee asked for the postponement because he said there were too many unanswered questions regarding what the land bank will do with the parcels and how much profit it will make from sales. He also said the land bank was operating in a “gray area” and was stepping on private-sector toes. “This is a huge purchase,” said Wawee.

Twelve other commissioners agreed with him, and by a 13-4 tally the vote was tabled. “We do need to get this right,” said Commissioner Roger Morgan.

“Some of these properties are being cherry-picked,” said Commissioner Dan Koorndyk, who added that he inspected 35 of the parcels the land bank wants.

The commissioners who voted against postponement did so because they felt enough time had already passed to learn about the bank’s procedures since the board enabled it in 2009.

“I think the notion that this has snuck up on us is disingenuous. I want to know the real reason behind this (delay),” said Commissioner Tom Antor.

“We’ve had three years to go through this. We’ve done lots of research. This is not something that hasn’t been done without transparency,” added Commissioner Harold Mast.

“If I would have waited until I got all my questions answered, I would never have gotten married,” said Commissioner Dick Bulkowski, whose comment was overwhelmingly met with laughter and temporarily eased the tension surrounding the discussion.

At the meeting, though, commissioners did give the land bank permission to buy two foreclosed parcels on Abrigador Trail for $14,000 in back taxes at the request of Plainfield Township. Both are in a flood plain, and the township had to take immediate possession of the properties in order to collect federal demolition and clean-up funds. The Grand Rapids Community Foundation has awarded the land bank a low-interest revolving loan to buy parcels; the agency will repay the foundation with the proceeds it receives from sales.

Of the 64 properties the land bank still wants to purchase, it wants to sell 21 to four nonprofit housing developers in Grand Rapids that would renovate the houses and put the homes on the market. The executive directors of two of those firms urged commissioners to make the sale.

“We’re in favor of the land bank. If we get these homes, we will put people to work,” said Scott Jonkhoff of Next Step of West Michigan.

“Having Dave (Allen) come on is making a huge difference. We really turn houses around,” added Helen Lehman of the New Development Corp.

LINC and Habitat for Humanity also want to purchase homes.

Steve Ruis, co-owner of Art of the Table and vice chairman of the Grand Rapids Planning Commission, said, “I do think the county and the land bank can make a positive impact. I encourage you to vote for (the sale). I think it’s important to move forward,” he said. “I’ve seen properties go through the auction process and then decline.”

But a longtime commercial and residential real estate broker and past president of the Grand Rapids Association of Realtors felt otherwise and asked commissioners to postpone their vote.

“Personally, I’m against the land bank. We don’t need an 800-pound gorilla to mess things up, and it does. It skews things,” said Rusty Richter. “At least, postpone this. At best, get out of the land-bank business.”

Richter said neither GRAR nor the home builders association have taken an official position on the land bank, but the home builders’ Emily Siebert is on the bank’s advisory council.

As for the Cedar Rock Business Park, Algoma Township wants the bank to buy three vacant parcels in the development at a cost of roughly $35,000. Each is about an acre in size. The last property-tax payment was made in 2008 for the 2006 tax year. One parcel has a successful strip mall on it and all have the appropriate infrastructure to accommodate a commercial project.

The park’s location could be a key selling point. It’s situated on 14 Mile Road, just outside of Rockford. Allen said if the bank takes possession of the parcels, it would sell them to a private developer at a discount if a developer pledges to build on the sites. Township officials asked the land bank to become involved in the development.

In the meantime, the land bank board agreed to contract with Miller Johnson and Van Eck Law for legal services; NAI Wisinski and Northstar for commercial real estate services; and Greenridge Realty, Adu, Home Run, Childress, Juanita Buskard and City Wide Real Estate Services for residential services. The agency requested proposals for the services and selected providers through a weighted scoring system.

Despite the hesitance commissioners recently showed about letting the land bank buy the foreclosed properties, they have transferred a foreclosed property to the bank. Earlier this year, they gave the bank permission to take possession of the former Sparta Foundry site at 252 Gardner St. in Sparta Township. The land bank has nearly finished cleaning up the four-acre property and reportedly is also close to selling it to what has been described as an “established company” whose identity is being withheld until a deal is imminent.

Allen met with that company in St. Louis recently when it bought a property there. “I’m just giddy with excitement to tell people what the company is going to do,” he said to members of the land bank board. “The company coming here has technology that isn’t available here.”

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