This story was originally published by PublicSource, a news partner of NEXTpittsburgh. PublicSource is a nonprofit media organization delivering local journalism at publicsource.org. You can sign up for their newsletters at publicsource.org/newsletters.
By Eric Jankiewicz
Since the decline of steel and coal, Pittsburgh has experienced waves of depopulation still visible through thousands of abandoned and vacant properties buried in tax debt with no one to pay it off.
Many so-called Rust Belt cities facing similar problems created land banks, organizations with the power to clear debt and taxes from abandoned properties and sell them.
Pittsburgh formed one in 2014, but it gained little traction in reclaiming the more than 20,000 vacant or abandoned properties within the city. At the end of 2021, though, officials with the Pittsburgh Land Bank were optimistic that millions of dollars in federal funds and a new full-time manager would help make 2022 the year of progress.
The organization hired new staff and the city earmarked $10 million through the American Rescue Plan Act (ARPA). But the federal funds sit in the city’s bank accounts, according to City Controller Michael Lamb, awaiting action from the land bank or the Urban Redevelopment Authority (URA) to access it. Local governments must spend or allocate ARPA funds by the end of 2024.
As this year nears its close, the land bank board has discussed which conventions its members should attend, even as the neighboring Tri-COG Land Bank moves forward with putting abandoned properties in private hands. The Pittsburgh Land Bank hasn’t processed or transferred any properties this year, and its inventory consists of one house in Mount Washington currently owned by the URA.
Every year, the city spends almost $2 million on code enforcement, police and fire services on abandoned properties, according to a 2017 report by the Center for Community Progress.
During the board’s Nov. 4 meeting, the land bank’s new manager, Sally Stadelman, responding to a question from a member of the public, said that the land bank wouldn’t be able to come to agreements with local taxing bodies to clear properties of tax debt without the passage of state legislation. The legislation would make a number of technical changes in land banking law, including allowing Pittsburgh’s agency to pursue ownership of property via sheriff’s sale – a power the state has given to other municipalities but not to Pittsburgh. The city now sells tax-delinquent properties through its own treasurer’s sale process, outlined in state law.
State Sen. Wayne Fontana, D-Brookline, a former Pittsburgh Land Bank board member who sponsored the legislation, said in an interview that the bill isn’t likely to pass because of Republican opposition.
“We’ll have to figure out another way to skin the cat,” Fontana said. “But the land bank can’t use the excuse that the bill hasn’t passed to not get going on clearing properties.”
The legislation would expedite the process but isn’t essential.
“A successful land bank requires financial and leadership commitment and then go do it,” he said.
On Nov. 4, Mayor Ed Gainey commented on the land bank during a conversation with three people including a PublicSource reporter. He said the land bank needed to be completely redone, including the removal of Pittsburgh City Council’s involvement on the board. He noted that his office is addressing the issue through negotiation but declined to elaborate.
“We have a once-in-a-lifetime check through ARPA, and I’m excited to see how those investments pay off and what that means for neighborhood stability in the long term,” said Ed Nusser, executive director of the nonprofit City of Bridges Community Land Trust, which works with neighborhood organizations to create affordable housing.
Nusser said that ideally land banks and land trusts “can have a really symbiotic relationship.”
He described his organization as an affordable housing developer across the region. Their challenge is often gaining access to property to redevelop into affordable housing. Having an operational land bank would give City of Bridges a reliable source for acquiring property.
“So land trusts can come in and take property from the land bank and guarantee those homes remain affordable forever,” he said.
“We’re definitely at an inflection point and we’ve had activists and organizers and grassroots folks screaming from the rooftops for six years that we need to get this going, and I think people are finally listening now.”
Land bank potential ‘frustrating and exciting’
Since its creation, the land bank hasn’t sold any properties.
The URA, the city’s economic development arm, became an affiliated entity of the land bank in 2021 and officials at the time hailed that as a step toward making the land bank effective. The URA declined to comment for this story and declined to allow Stadelman, the land bank’s new manager, to comment. Stadelman previously served as chief of staff for City Councilman Bobby Wilson, who is a member of the land bank’s board.
City Councilman Ricky Burgess, the land bank board chair, said he was hopeful they would find a way forward but so far, “we haven’t figured out ways to clear title, and that can be lengthy and expensive.”
Nusser pointed out that the nearby Tri-COG Land Bank charts a path to success.
“It’s been so frustrating and exciting,” Nusser said. “We can look around and see what the potential of a land bank could be at the city level and we could get stuff going now to benefit a lot of our neighborhoods and communities.”
What’s the combination to unlock the land bank?
Fontana wondered why the land bank wasn’t actively using the available federal funds. He asked: “The $10 million of ARPA funds, where is it?”
Lamb noted that the money was ready to be transferred. The URA or land bank just needs to request it and provide a plan on how they intend to use the money.
“If the land bank were to propose some use for the $10 million, we would release it directly to them but that hasn’t happened yet,” Lamb said.
Fontana said the fact that several members of the land bank board serve on city council makes the issue more complicated. Three council members – Wilson, Burgess and R. Daniel Lavelle – sit on the nine-seat board.
“You need to water down the political aspect,” Fontana said. “You need a citywide approach, start the process and stay committed to it.”
Jamil Bey, the land bank board’s vice chair, made a similar assessment.
“There should not be any elected officials on the land bank,” he said. “You’re introducing politics into a system that’s supposed to be efficient and transactional.”
Bey also serves as the president and CEO of the UrbanKind Institute.
Council currently votes on proposed transfers of tax-delinquent property to private owners.
Bey said council members thought the land bank was “going to take away city council power.”
Burgess countered that the whole thing would be more difficult if the city council wasn’t on the land bank’s board.
“If you take us off the land bank, you could have a council that is less likely to work with the land bank and that will make the process more difficult,” Burgess said. “City council maintains control of land and having council on the [land bank] board helps make sure council approves of disposition [of properties]. Not having council will make the process more complicated and bifurcated.”
A resolution introduced by Gainey’s administration to city council in May, which would authorize shared services and property transfers between the city, the URA and the land bank, has not gotten a final vote.
The active land bank next door
An Lewis, executive director of the Tri-COG Land Bank, said her organization has processed properties for the last five years, “creating a property pipeline and figuring out … how to identify them and move them through the legal process to clear titles.”
Since its founding in 2017, the Tri-COG has owned 85 properties and sold 35 properties. They are in the process of acquiring 64 more properties.
The Tri-COG acquires most of its properties through tax foreclosure handled through sheriff’s sale.
“The important thing,” Lewis said, “is to create good, strong policies that give people access to our real estate and vet buyers so that we aren’t inadvertently selling to an irresponsible property owner.”
Tri-COG works with 26 municipalities mostly east of Pittsburgh. Abandoned properties accumulate bills for unpaid taxes, causing private investors to shy away from buying because they would have to pay off those taxes. The key to the Tri-COG’s success, Lewis said, has been to come up with agreements with the local taxing bodies to waive those overdue real estate, municipal and school district taxes.
“All those delinquent taxes, unpaid garbage bills, all those debts have to be waived before we get involved,” Lewis said.
“Our land bank,” she continued, “is a nimble and flexible tool, and we’ve had to learn what a municipality’s goals are and create a land banking strategy based on that. That’s what’s fun about this work: This tool is so flexible.”
Wilson said he and the other Pittsburgh Land Bank board members expect to work on a strategic plan next year and determine how to use the $10 million in federal funds.
“My mind is set to get it working,” Wilson said.
Eric Jankiewicz is PublicSource’s economic development reporter, and can be reached at firstname.lastname@example.org or on Twitter @ericjankiewicz.