Grand Traverse County, Michigan Creates Unique Housing Trust Fund Tied to Land Bank Authority
Grand Traverse County, Michigan has established a housing trust fund in connection with its Land Bank Authority, enabling the housing trust fund to receive revenues from the proceeds of tax-foreclosed properties. In November 2010, the full County Board of Commissioners approved the plan for the Housing Trust Fund. These funds can then be returned to the community to assist in rehabilitating existing housing, development start-up costs, and other activities to sustain and strengthen the community.
The housing trust fund in Grand Traverse County is innovative not only for its connection to the Land Bank Authority, but also as a model for demonstrating a pro-active approach to the devastation foreclosures can bring to a community and its residents.
In May 2006, the Grand Traverse County Board of Commissioners approved the establishment of a Land Bank Authority and the State of Michigan gave its stamp of approval. A land bank authority is a governmental entity that focuses on the conversion of vacant, abandoned, and tax-delinquent properties into productive use. The Grand Traverse County Land Bank Authority is staffed by the Grand Traverse County Planning and Development Department.
The Grand Vision—a two-year, citizen- based land use and transportation project—produced a 50-year outline for growth in the six-county Grand Traverse region that includes a vision for more affordable housing. A large majority of the 15,000 who attended Grand Vision workshops or filled out ballots, said they wanted more housing for working families. To meet that challenge, Grand Vision supporters are forming a new partnership between public, private, and nonprofit organizations that support affordable housing. Known as the Grand Vision Housing Task Force, the group wants better tools to build more in-town housing for working families.
Grand Traverse County began using several public financing tools to promote more affordable housing even before the Grand Vision process began in earnest in 2007. Among these activities were utilizing the brownfield redevelopment tool available in Michigan to revitalize properties and the formation of the Land Bank Authority.
The creation of the Housing Trust Fund was a natural step for the advances made in Grand Traverse County. Funding for the Trust Fund comes from the Foreclosure Fund and the net proceeds of tax-foreclosed property. For the first three years of the Trust Fund operation, 75% of the net proceeds from the sale of tax- foreclosed properties will go into the Housing Trust Fund. In the fourth year, this arrangement will be reviewed. For start-up funding, the County Board of Commissioners allocated $190,000 from previous year’s tax foreclosure sales.
The Housing Trust Fund model and funding methodology drew the attention of the U.S. Department of Housing and Urban Development, which matched the initial amount of proceeds in the fall of 2010 through the highly competitive Sustainable Community Challenge Grant program.
The Planning and Development Staff will be working to increase the overall amount within the housing trust fund. Working to build the capacity of the Housing Trust Fund will enable the Land Bank to partner by leveraging trust fund dollars with private, governmental and charitable sources. With the leadership of the County Board of Commissioners and the Land Bank Authority, the opportunity to bring private and public partnerships together to help meet community housing and planning goals is now available.
This leadership and the community’s desire to have a healthy mix of housing options–from market-rate and affordable rental housing, single-family homes, duplexes, as well as developments for seniors–ensures opportunities for all individuals to improve their economic situation and contribute to the success of Grand Traverse County.
It is with great anticipation that this ground breaking funding mechanism can be duplicated in other communities to provide local governments another mechanism to help achieve community housing needs.
Contact:
Jean Derenzy
Grand Traverse County, Planning and Development Office
400 Boardman Avenue, Traverse City, MI 49684
(231-922-4513)
jderenzy@grandtraverse.org
