NEWARK, NJ - The Newark Community Economic Development Corporation (NCEDC) will assist with a long-awaited land bank, an online database of city-owned property that is up for sale.
NCEDC President and CEO Bernel Hall made mention of the plans for the land bank at a May 7 presentation to council members. A land bank has not been created in Newark yet, but a city report last year recommended that one possibly be managed by the NCEDC.
“Upon the approval of legislation, we will assist in administration of the land bank,” said Hall, who took the helm of the development corporation in February. "We will serve as an investment manager. We will also serve as a co-development company, helping [Minority and Women Owned Business Enterprises] expand their capacity to do neighborhood development projects."
State Sen. M. Teresa Ruiz (D-Essex) sponsored a bill that lays the groundwork for the creation of the land bank. It allows a municipality to designate a non-profit or redevelopment entity to act as a land bank to the city.
Under the bill, the land bank would be able to acquire properties for the bank through gift or purchase and act as the municipality's agent to purchase liens at tax sale. It would also allow an organization such as the NCEDC to carry out lien foreclosures and acquire individual property takings.
A land bank aims to end blight. The report from last year said city-owned property in the bank would consist of abandoned houses and other structures that have gone into foreclosure.
The report also outlined possible funding sources for the land bank, including federal grants, the city's budget and private donations.
Right now, city council has to pass a resolution to sell city-owned property to a new owner. A city ordinance requires Newark to sell the property at a minimum of $4 per square foot, according to Councilman At-Large Carlos Gonzalez.
NCEDC is a quasi-governmental entity with Newark as its only client. Gonzalez noted that the organization would most likely not be subjected to the requirement to sell the property at $4 per square foot if it was acting as a land bank.
“How are you going to determine the value of the property that is being sold?” Gonzalez asked Hall.
The NCEDC president said that it wouldn’t do anything outside of city ordinances and would look at market value and the purpose for the use of the land. The NCEDC would also use comparables to determine how much a property should go for, Hall said.
City Business Administrator Eric Pennington said the properties that will be in the land bank will be “less desirable” ones.
“Properties that are going to the land bank, we anticipate, will be properties that will not be sold first at auction, that will not be first involved in negotiation with the administration and the council's input,” Pennington said.
The NCEDC receives funding from the city, but is looking to fund itself in the future. Hall said the organization is undergoing a restructure and is looking to hire more people, particularly Newark residents.
City spokesman Frank Baraff said the land bank is one of Mayor Ras Baraka’s major initiatives.
“In the mayor’s mind, this is really big,” Baraff said, adding that the mayor visited Detroit to see how it handled its land bank. “He saw how useful a land bank can be.”
The Detroit Land Bank Authority has been operating for about 10 years. It reportedly received subpoenas amid a federal investigation in January, but has also been praised for increasing home ownership for Detroit residents.
The NECDC currently helps identify available parcels of land throughout the city for projects. To learn more, visit the organization's website.