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What you need to know for 07/28/2017

Schenectady officials debate land bank effectiveness

Schenectady officials debate land bank effectiveness

After all the work to get a land bank in Schenectady, only one house has been sold in two years. The

After all the work to get a land bank in Schenectady, only one house has been sold in two years. There’s also just one house in the land bank awaiting demolition.

In response, City Councilman Carl Erikson issued a stinging critique of the land bank — or Land Reutilization Corporation of the Capital Region — saying city officials have failed to support it by giving it properties to sell or demolish.

“We have this great tool and we’re not using it,” he said. “We should have 100 houses in there.”

Not so fast, Mayor Gary McCarthy said. He wants to use the land bank for demolitions and expensive rehabs — the houses that can’t be sold.

“That’s what I’m hoping to do,” he said after hearing about Erikson’s remarks.

The original idea behind the land bank was to sell some houses to pay for demolitions of others, but McCarthy said the city could simply use state grants instead. Settlements from banks involved in the housing meltdown are funding many land banks, but Schenectady’s requests for money have so far been rejected.

Erikson believes that’s because the city isn’t using its land bank. McCarthy said he’s been in touch with the Attorney General’s Office and expects funding soon.

McCarthy also said the land bank could hurt the city’s budget if it sold houses. Those sales currently go into the general fund, and taking that revenue out could create a deficit.

Erikson said it would be better to have that money in the land bank, where it would be restricted to housing-only costs.

“It isn’t that the land bank isn’t doing a good job, it’s that the city isn’t giving them any land,” he said. “We can move them [houses] in. I’m pushing for that.”

He wants the City Council to transfer most or all of the foreclosed houses taken in the upcoming round of foreclosures to the land bank.

McCarthy said that would be short-sighted.

“You’ve got to look at each property individually,” he said. “Each one is a complicated deal. Some properties have environmental issues. You have to have a game plan — you don’t want to just park properties in the land bank.”

Zoning Officer Steve Strichman, who administers the land bank, agreed with Erikson that the land bank is underused.

“I couldn’t agree more,” he said. “No one’s happy with one property” sold.

But without money to maintain houses, he said, the land bank can’t take on the responsibility of additional properties.

Councilwoman Leesa Perazzo defended the land bank’s results, noting that it took well over a year to set up policies and procedures.

“There’s a lot of minutiae we had to go through,” she said, adding that she had questions about Erikson’s idea.

“Is it feasible to put 100 properties in there? It sounds like we need funding first.”

Erikson said that was precisely the wrong strategy. The city has not received land bank funding in successive rounds of state grants, and he blamed it on the organization’s lack of activity.

“We lost out on that money because we weren’t using it,” he said. “The city has not embraced it. We’ve been given this tool . . . it was this great struggle . . . and we don’t seem to be gung-ho.”

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