By Gordon Hopkins
Fairbury Mayor Spencer Brown met with the Village Board of Endicott on Monday, September 11, 2023, to discuss the possibility of partnering in a Municipal Land Bank (MLB).
A land bank is an entity created by a municipality which generally allows for the acquisition, maintenance, development, and disposition of real property for the purpose of returning it to productive use. The Nebraska Municipal Land Bank Act, Neb. Rev. Stat. §§ 18-3401 et seq. (Act), was first passed in 2013, applicable primarily to Omaha and Lincoln, and subsequently amended in 2020, expanding application to the remaining classes of municipalities. The League of Nebraska Municipalities (LONM) has created resources for setting up land banks, including templates for formation and organization, which are provided with this memorandum for reference.
Mayor Brown hopes a land bank can address both issues of much needed workforce housing and well as dilapidated and rundown properties.
For any municipality other than Omaha or Lincoln, the creation of an MLB requires the cooperation of at least two municipalities through an interlocal agreement. The public policy rational for this requirement is that MLBs require significant resources to operate and maintain, which the Legislature viewed as potentially burdensome for cities of the first or second class or villages to manage on their own. Therefore, as a city of the second class, Fairbury must partner with another municipality to create and operate a MLB.
According to Fairbury Deputy City Attorney Kurth Brashear of Rembolt Ludtke, LLP, who discussed land banks at a meeting of the Fairbury City Council earlier this year, “The land bank is created by the municipality to do acquisition and maintenance development of disposition of real property. The key part is, it’s all about returning it to productive use. So that is the objective not for the land bank can be a long term property when that is done whatever is needed to get something that is not being productively used now, and then gets it back into productive use. It is a separate public corporation and political subdivision once it’s created. So this is done through the land bank, not through the city of Fairbury.”
“What a land bank can do,” said Brashear. “Designing projects, developing projects, constructing projects, demolishing projects, reconstructing projects, clearing locks, information, relocation. Really, it is everything related to real property to return it to productive use, with very few limitations. It can lease property, including leases of up to 12 months. It can be either the tenant or the landlord.”
Brashear indicated there are currently three MLBs outside Omaha and Lincoln which have recently been created or are in the process of being created: Norfolk with Hader, Scottsbluff with Gering and McCook, acting as the “anchor community” with several surrounding municipalities.
No action was taken at the Endicott meeting. Mayor Brown is planning on approaching other municipalities as well.
By Gordon Hopkins