Authorizes land banks to access real property prior to acquisition of the property and relates to the liabilities and exemptions from liability of land banks

BILL NUMBER:S5776

Title of bill

An act to amend the not-for-profit corporation law, in relation to authorizing land banks to access real property prior to acquisition of the property and to the liabilities and exemptions from liability of land banks with relation to the acquisition and ownership of vacant, abandoned or tax delinquent real property

Purpose

The purpose of this bill is to provide land banks with access to properties prior to the transfer of ownership to assess environmental conditions. The bill also provides land banks with liability protections from environmental conditions and contaminations after the transfer of ownership that they would currently be held responsible for.

Summary of provisions

Section 1 of the bill adds sections 1608-a and 1608-b to § 1608 of the not-for-profit corporation law. § 1608-a relates to access to real property to acquisition. § 1608-b relates to liability exemption and defenses.

Section 2 is the effective date.

Justification

In 2011, the Land Bank act was signed into law in order to help municipalities address blight and vacant properties. Since the land banks have started operation, a number of concerns have been identified that have impeded the work of the land banks.

Land banks typically acquire abandoned or tax delinquent properties from absent or uncooperative owners. Often, they are unable to legally access such properties prior to purchase and therefore cannot perform due diligence into the environmental condition of such parcel prior to ownership. That potentially prevents land banks from asserting statutory defenses and exposes them to liability for the costs of remediation.

Land banks are tasked with acquiring vacant, abandoned and delinquent properties to facilitate their return to productive use, In the event a land bank acquires environmentally contaminated real property, the public assets of a land bank are potentially exposed to liability which could include significant remediation costs.

This bill will provide land banks with temporary incidents of ownership sufficient to authorize such access prior to transfer, without incurring liability based upon ownership. It will also provide liability protections to land banks similar to those which are already available to municipalities, as land banks are not typical voluntary buyers.

Legislative history

New bill.

Fiscal implications

Undetermined.

Effective date

The act shall take effect immediately.