May 29, 2014

Assembly Boosts Community Revitalization Efforts, Passes Legislation to Increase Number of Land Banks in New York

Speaker Sheldon Silver and Local Governments Committee Chair William Magnarelli today announced the passage of legislation that would authorize the increase of the number of land banks in New York State from 10 to 20 (A.8819, Magnarelli).

"Expanding the number of land banks throughout the state provides a boost for struggling urban communities, empowers municipalities and opens countless doors for community revitalization and economic development," Silver said. "This measure provides cities and towns with the opportunity take long-abandoned or vacant properties and transform them into something that neighborhoods, families and businesses can benefit from. Increasing the number of land banks is a common-sense, effective step toward success for local governments statewide."

"Land banks are one of the most useful tools for jumpstarting community renewal projects," Magnarelli said. "Expanding the number of land banks throughout New York can provide job opportunities, raise property values and truly improve the overall quality of life for both business owners and homeowners. Passing this legislation would help give localities greater opportunities to rebuild dilapidated and forgotten properties in a way that better serves the needs of community members."

According to the website of New York State Attorney General Eric Schneiderman, the Attorney General allocated a portion of funding from the National Mortgage Settlement - $20 million total - to fund legally designated land banks in New York State through a competitive request for applications.1 The first round of funding was announced this past October. Applications for counties, towns and cities to apply for a second round of land bank funding will be available in the summer of 2014.

The National Mortgage Settlement was announced in 2012 when a total of 49 state attorneys general and the federal government unveiled a historic joint state-federal settlement with the country's five largest mortgage servicers - Ally/GMAC, Bank of America, JP Morgan Chase, Citi and Wells Fargo. The Settlement was agreed upon following state and federal investigations that found these five institutions violated the law by routinely signing foreclosure-related documents outside the presence of notary and without verifying whether the information contained in the documents were correct.