One of the first ingredients in any successful business plan is access to working capital. Money.
Rome-Floyd County Land Bank Authority Director Bekki Fox said it would be a game-changer if the Rome City and Floyd County commissions allow the LBA to use some of the federal American Rescue Plan funds that have been allocated to the community.
Fox, who also heads Rome’s community development department, said the LBA is uniquely suited to help make tremendous strides in dealing with the local housing crisis. That, in turn, could benefit the effort to attract new jobs.
“This has never happened before,” Fox said. “This is the first time ever that all local governments have been given money by the federal government that they didn’t have to compete for.”
“We are the right vehicle for housing development and neighborhood improvement and neighborhood stabilization,” she added. “We don’t have another vehicle in the city and county that can do that. Especially since it’s a joint effort.”
The city of Rome is expecting to receive approximately $11.5 million and Floyd County anticipates more than $19 million.
The Land Bank Authority was created in 2008 under an old state statute but didn’t do much for a number of years. The national nonprofit Center for Community Progress helped Georgia rewrite its land bank law in 2012, which led to the reorganization of the local authority in 2014.
It wasn’t until 2017 that the city and county adopted a new intergovernmental agreement to move the Land Bank Authority forward. It started with seed money of $5,000 and now has a bank account with $218,000 available to it.
How did that happen?
The LBA’s purpose is to help get abandoned or foreclosed properties back in use, back on the tax rolls. Fox said County Tax Commissioner Kevin Payne has been a good partner in the initiative.
When taxes haven’t been paid on a property, part of Payne’s job is to auction it off to cover the tax debt. But when the LBA gets contacted by someone with a specific plan for developing a property that doesn’t sell at an auction, Payne deeds it over to the land bank, which in turn sells it to the interested buyer.
Of the 165 properties that have been sold by the land bank over the last five years, the overwhelming majority have been vacant properties.
Some have been bought up by neighbors who have helped keep up the property over the years. Others have been bought by real estate speculators. In a few cases the property contained a structure, which was either rehabilitated or demolished to make way for something new.
The sales have brought approximately $2.1 million worth of property back onto the tax rolls, Fox said.
And when the land bank sells a property, it retains the proceeds plus 75% of the property tax money that it generates over the next five years.
Using the money
The prospect of additional money from the American Rescue Plan has Fox dreaming of the possibilities.
She is seeking to seize the opportunity to be a very intentional player in a housing revitalization plan community leaders have prioritized in the last six months.
For the most part, that starts with clearing the titles to a lot of the properties the land bank takes in. It’s a lengthy and fairly expensive process.
“Many of these are estate properties — people who have died and left them to Jim Bob, and Jim Bob may be dead too and he’s got 12 kids and they don’t care, they’re spread all around the county,” Fox said. “We’re like the last hope for some of these properties.”
The ARP money could provide a chance to hire a dedicated staff person and develop the affordable housing that officials would like to see.
The authority “could take on a myriad of roles,” said LBA Chairman Roger Smith. “That could be anything from building and selling, ourselves, to leasing or renting, ourselves.”
Establishing better relationships with local builders would also be a major priority, according to Smith. He said an influx of funds could help the authority help contractors acquire properties where they could build and sell affordable housing.
“Now we are actually able, because we’ve generated a little bit of income, to put together properties that would make great places within neighborhoods for us, or other developers, to build and create more pocket neighborhoods,” Smith said.
For example, the authority recently purchased a property in South Rome between two parcels that had already been deeded to the land bank. By combining the three properties, Fox said she hopes to be able to work with builders to construct several small homes — now that minimum lot size requirements have been eliminated from the Unified Land Development Code.
If the authority is able to get an allocation from the city and county, Fox will have a short period of time to use it. The ARP requires the funds to be encumbered by Dec. 31, 2024, and spent by Dec. 31, 2026.
It can take as long as six to eight months to clear the title to a property, so the LBA has already earmarked some of its $218,000 in the bank to get attorneys working on a number of what might be considered the better sites.
Fox said she is also considering a partnership with the construction program at Georgia Northwestern Technical College to use student labor to build or rehab homes.
“We need (new) trades people,” Fox said.
County Manager Jamie McCord is taking a cautious approach to making any kind of promise about use of the money Floyd County will be receiving from ARP. He did say that — if the LBA plans fit the criteria for use of the funds — there are some low-income areas of the county where it could be beneficial to improving housing opportunities.
“They’ve been great to get unusable properties usable,” McCord said. “We’ve got issues in Shannon; we’ve got issues in Lindale. There are pockets all over that could be redeveloped and reused and certainly meet this need.”
Fox said there is also a possibility that the Georgia Association of Land Bank Authorities will ask for a portion of the more than $4 billion that has been allocated to the state of Georgia.
State Sen. Chuck Hufstetler, R-Rome, has been appointed by Gov. Brian Kemp to a committee that will examine applications and make recommendations for the best use of the ARP funds.