Detroit Land Bank Community Partners are able to use Land Bank acquired properties for home rehab projects, urban gardening, green space projects or any use that enhances the quality of life in neighborhoods. Community Partners can address the issue of blight through home rehabilitation projects, deconstruction projects, new construction, lot beautification, community gardens, and pocket parks (projects not limited to those suggested.)
The Detroit Land Bank Authority (DLBA) believes that in order to speed the reuse of abandoned property in the city of Detroit, partnerships with nonprofit, faith-based or community development organizations are essential.
- Who can be a DLBA Community Partner?
To become a Community Partner, a qualifying nonprofit, faith-based organization, or a community development organization must meet the following standards. Failure to meet these standards will result in the denial of a Community Partnership request.
- Be located in the City of Detroit;
- Have a federal tax-exempt status;
- Be current on its property taxes;
- Not have any blight violations or fines; and
- Each Community Partner wilt be a partner for a defined geographic target area as agreed on by the Community Partner and the DLBA. The size and boundaries of an organization's defined geographic target area will not exceed 5 square miles. [Note that the geographic target area is not exclusive to an individual Community Partner, but rather will likely overlap with other Community Partners' geographic target areas. Competing requests will be prioritized first by demonstration of sufficient financial and organizational capacity and then in a first come, first served manner.]
- Receive a letter of recommendation from the applicable District Manager or a letter of recommendation from the Member of City Council representing the applicable district.
The DLBA has the sole discretion as to whether to approve a Community Partnership and issue a Community Partnership Certificate. The DLBA reserves the right to decline a Community Partnership with any group where the DLBA is not convinced of the prospective Community Partner's financial and organizational ability to fulfill their proposed project.
A Community Partner may not act as a straw-buyer in order to immediately transfer property to a for-profit entity in contrary to the purpose of Community Partnership Program. If a Community Partner is found to do this, the DLBA may terminate the Community Partnership.
- What does a Community Partner do?
A Community Partner does not actually have to buy or own properties itself. Instead, it may identify homeowners who have the ability to fix up and maintain the house and live in the community as good neighbors. The Community Partner must provide in writing to the DLBA its process for selecting and endorsing a 'bidder. It is expected that a bidder endorsed by a community group will live in the house themselves for at least three years.
For each auction of a house in its service area, the Community Partner may endorse one bidder it deems to be a good neighbor for the community. The Community Partner's endorsement means the endorsed bidder will get an automatic 20% bonus on their bid amount. (That is, an endorsed bidder who bids $10,000 will see their bid price on the auction site display as $12,000. The endorsed bidder would then pay $10,000 for the home.) The DLBA has determined that it is worth taking 20% less on a sales price in order to get homeowners committed to the neighborhood.
All winning bidders must comply with the terms of the Auction Purchase Agreement including the deadlines for closing, rehabilitating, and occupying the property. If endorsed bidders fail to meet these deadlines, the DLBA may terminate the Community Partnership. The DLBA is relying on the Community Partners to vet the bidders before endorsing them.
- Purchase for Projects of 9 or fewer properties
If the Community Partner wants to acquire property in its target area, the DLBA may contract to sell the Community Partner 9 or fewer properties. The price for property sold in a small project will be fair market value as determined by the DLBA less 20%. The purchase price may then be further reduced by the expected cost of blight removal and remediation. A Community Partner must demonstrate organizational and financial capacity to perform the proposed project within the agreed upon time frame for all properties purchased from the DLBA.
- Purchase for Projects of 10 or more Properties or Commercial Property
A Community Partner may propose a large acquisition of 10 or more DLBA owned properties or commercial property. That sale will based on a specific and appropriate transaction agreement that permits the DLBA to enforce any conditions pertaining to the development and use of the property. The proposed project must be in compliance with zoning, or if not, the transaction agreement should identify a mechanism to ensure that zoning requirements can be modified or achieved. The price for 10 or more properties or commercial property will be negotiated based on staff guidelines. The guidelines will identify factors to be considered when pricing property for transfer. Valuation methods could include, but are not limited to, appraisals, Broker's Price Opinions (BPOs), two times the State Equalized Value (SEV), or a price as established by the City Economic Development Offices. The consideration to be received by the DLBA for the transfer of property shall be determined by the DLBA in its sole discretion, but these factors should be applied consistently, and staff will be required to provide a written justification for the proposed pricing. A Community Partner must demonstrate organizational and financial capacity to perform the project within the agreed upon timeframe. For commercial property, the DLBA must review title for possible environmental legacy concerns and communicate this information to the Community Partner prior to transfer. Where there is evidence of environmental contamination, the Community Partner must adhere to state law environmental requirements for the purchase of property.
- Other Items
- The DLBA reserves the right to refuse sale without cause and will do so in writing to the Community Partner. In the event that the DLBA changes its mind and ultimately refuses to sell property pursuant to a Community Partner project already approved by the Detroit City Council, the DLBA will notify the Detroit City Council of that decision in writing simultaneously upon notifying the Community Partner. The DLBA shall provide such notification to the Detroit City Council through the Office of the Detroit City Clerk.
- Properties will be addressed on a first come, first served basis
- All Community Partner projects that propose a large acquisition of 10 or more DLBA owned properties will require the approval of the DLBA Board and must comply with any review requirements established by the Detroit City Council.
- Staff guidelines will provide for an efficient and effective method to accommodate requests to "hold" properties for a reasonably limited period of time and for a specified purpose. "Holding" property means reserving property in the DLBA's inventory for a designated party to allow time for the commencement and/or completion of due diligence.
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