In May 2020, the Ohio Supreme Court docket issued an opinion that carries significance for county elected officers and neighborhood and financial builders. Rejecting an activist effort to invalidate “expedited tax foreclosures,” the Court docket upheld the observe in Ohio by which county Boards of Revision (BOR) may instantly switch unoccupied, tax delinquent properties to county land banks.
County land reutilization companies, generally often called land banks, are designated by their county commissioners to function as a extra highly effective type of Group Enchancment Companies (CICs) below Ohio Revised Code (R.C.) Chapter 1724. A lot of these CICs may make use of the land banking statutes obtainable below Ohio regulation (R.C. Chapter 5722).
Since 2006, county land banks have wielded specific energy to amass property freed from cost in sure tax foreclosures fits, cleanse property title of all liens and different blemishes, after which place the property again on the open market. This type of property reuse has been particularly useful in eradicating neighborhood eyesores or site-assembling parcels for financial growth.
Beneath this so-called expedited tax foreclosures course of, county land banks instantly obtain title to actual property from their county’s BOR, and the BOR formally deems such property as “abandoned.” The method is ready forth in R.C. Sections 323.65 – 323.79, with direct switch to a county land bank occurring 28 days after a board’s order is issued. As soon as transferred, title is cleansed of all delinquent taxes and assessments, curiosity and penalties, in addition to all different subordinate liens.
Attorneys and property rights activists filed go well with in 2019 within the Ohio Supreme Court docket, searching for to invalidate the expedited tax foreclosures course of on constitutional grounds (i.e., separation of powers and due course of). The filed criticism had a direct chilling impact throughout Ohio’s greater than 50 county land banks, as title insurers refused to insure property bought on the open market by county land banks because the case was being determined.
We will now say that expedited tax foreclosures stays good regulation in Ohio, as the method has sustained its first actual court docket problem. The Court docket rejected the plaintiffs’ arguments on restricted grounds, noting county boards of revision switch properties to county land banks “with apparent (and presumptively valid) statutory authority.”
Thus, county land banks (fashioned as CICs with expanded powers) may proceed to amass property for gratis by way of direct switch upon BORs discovering the property “abandoned.” This methodology of buying property takes place along with (1) choosing parcels from county prosecutors’ lists of pending foreclosures actions, (2) merely choosing parcels from county auditors’ forfeited lands lists, (3) receiving property donations in lieu of submitting tax foreclosures, or (4) partaking in arm’s size transactions to buy property.
Bricker’s Public Finance workforce needs to acknowledge the sudden passing in June of certainly one of Ohio’s most ardent proponents of county land banks, Robin Darden Thomas. Integral to launching dozens of county land banks throughout the state in the course of the previous a number of years, Robin was a consummate skilled and deeply educated of her craft.