By John Crane | Original Article
Feb. 20, 2019

Danville now officially has a land-bank entity that will acquire derelict and tax-delinquent properties in the city for reuse.

The Danville Neighborhood Development Corporation, a relatively new nonprofit, will administer this program. Officials hope the organization will take land — whether through purchase or donation — and try to build new homes on or find other uses for those properties.

Danville City Council voted unanimously to designate the organization as the city’s land-bank entity during its meeting Tuesday night. The decision came after lengthy discussion in which councilmen asked questions about the group’s role and whether the city would be permanently saddled with paying for it.

“We’re just going to fund this in perpetuity?” Councilman Adam Tomer asked.

“The hope is for it to be self-sustaining in the future,” City Manager Ken Larking responded.

There are about 250 blighted, run-down properties in which the structures have either been demolished by the city or the homes on the lots have been stabilized with the potential to be redeveloped.

The Danville Redevelopment and Housing Authority currently owns the properties, which will be eventually transferred to the nonprofit. Inmates from the Danville Adult Detention Center have been cleaning and mowing the properties, and will continue to do so when the nonprofit organization acquires them.

Councilman Fred Shanks asked if the group would be leasing any of the properties.

Deputy City Manager Earl Reynolds told the Danville Register & Bee on Wednesday that the Danville Neighborhood Development Corporation — as the city’s land bank — will not hold onto or lease properties. However, as a group apart from just being the city’s land bank, it would have the option of acquiring properties they’re interested in and leasing them out or rehabilitating them on their own, but not as part of the city’s land-bank program.

Councilman Gary Miller expressed concerns about taxpayers left with the bill when outside funding for the land-bank entity runs out.

“There’s plenty of money now, but outside funding dries up with city taxpayers left on the hook,” Miller said. “If we don’t keep a close eye on this, the taxpayer will be paying more and more for the bill.”

Reynolds said Wednesday that money provided by the city for the group would come from funds already allocated for blight eradication. There would be no extra costs to the taxpayer, he said.

The city has allocated about $700,000 annually for blight eradication for several years, Larking told councilmen. The city provided $250,000 in seed money for the group in 2017 to help get the group started, which had already been budgeted for that purpose, Reynolds told the Danville Register & Bee.

The goal is to get the properties back into private hands, Vice Mayor Lee Vogler said at the meeting.

“The city has 250 properties it’s already overseeing,” he said. “This is simply being shifted back to the land bank.”

The land bank would acquire problem properties and clear them of liens, he added.

“This has no intention of competing with the private sector,” Vogler said.

It will save taxpayer money over the long term by helping stabilize neighborhoods and reducing the need for spending on blight eradication, Larking told the Register & Bee.

A program to help streamline Danville’s blight removal process was approved by the General Assembly and then-Gov. Terry McAuliffe in 2016.

The measure allowed Danville to create Virginia’s first land bank program enabling the city to auction off properties and streamline the blight removal process.

Danville Neighborhood Development Corporation Executive Director Ernecia Coles is working with city staff, residents, church leaders and the authority to create redevelopment plans for derelict structures and vacant lots in the Almegro, Monument-Berryman, Old West End, Cardinal Village, Schoolfield, Westmoreland and North Side communities in the city.

The group was recommended by a housing study — by CZB, LLC — commissioned by the city in 2015. The nonprofit was established after the Land Bank Entities Act of Virginia took effect on July 1, 2016. That legislation was introduced by Del. Danny Marshall, R-Danville.

The group is not an official arm of the city, which is not liable for its operations or responsible for any of its debts or other financial liabilities.