TAX-LIEN SALE Land-use program touted

The city and county will work together to get more vacant land reused.
YOUNGSTOWN -- Mahoning County's vacant abandoned lots are being put to productive use by organizations and citizens who have taken advantage of the treasurer office's land reutilization program.
Treasurer John B. Reardon had a news conference Monday in the county courthouse to highlight the program's success and get testimonies from those who have used it.
The program is tied to the county's tax-lien sale on thousands of parcels involving delinquent taxes.
The county's first negotiated tax-lien sale last year brought in more than $10 million in previously unpaid property taxes. That money was distributed primarily to the county's school districts.
Reardon said the county sold 17,500 delinquent tax liens to American Tax Funding of North Palm Beach, Fla., and collected the tax due on 6,500 parcels.
The Florida company bought the county's tax liens against delinquent parcels and collected the delinquent amount from the property owners, plus interest.
If the money is not paid within one year, the investor can foreclose on the property to recover the investment. If the investor bought the tax-lien certificate for less than the delinquent amount, the balance of the debt can be wiped off the county's books.
Reardon explained that at the same time of the tax-lien sale, the treasurer's office wrote a contract with ATF to have the company transfer vacant parcel liens to interested third parties with a development plan at a nominal cost.
"The tax-lien certificate can then be used to legally facilitate taking ownership of the land," Reardon said.
How it works
For example, ATF may buy a lien on a county property with a $5,000 delinquency for $45 to $50. Reardon could then direct the company to sell the lien to an individual or another party for that price who had a specific development plan for the property.
The buyer would then become the primary lien holder and would contact the landowner. The lien holder could offer to make the $5,000 debt go away if the delinquent landowner signs a deed giving the land to the prospective buyer.
Habitat for Humanity of Mahoning County bought debt on 11 vacant parcels in Struthers and one on Youngstown's East Side last year for a total of just $1,200 under the land reutilization program.
"We have now built homes on those parcels and now have productive, tax-producing land," said Bill Farragher, Habitat board member. Habitat, a nonprofit, faith-based organization, builds homes for low-income families.
Patrick Kerrigan spoke of how St. Patrick's Church on the city's South Side used the program to get vacant lots to expand parking for the church and nearby Summit Academy charter school as well as for a proposed playground.
Retired pastor Jay Alford of Youngstown said he has seen "no tool anywhere that compares with the tax-lien program" and land reuse plan, which he said will be used by Community Housing Options Involving Cooperative Efforts, a Youngstown program, to build and renovate homes on the city's lower South Side area.
Political objectives
Reardon said he had two goals when he took office in 1998. One was to reduce the county's delinquent tax duplicate, which was almost $50 million. The second goal was to find a way to return the county's 15,000 vacant abandoned lots to productive use. He thanked his office staff for working diligently with him to achieve those goals.
He thanked state Sen. Bob Hagan of Youngstown, D-33rd, and state Rep. Sylvester Patton of Youngstown, D-60th, for their help in getting the state Legislature to create a law allowing for counties to negotiate tax-lien sales.
Only Mahoning and Cuyahoga counties have negotiated tax-lien sale programs, Reardon said.
The treasurer added the county and city have established a regional council of governments in an effort to make vacant property transfers more efficient and cost effective for potential buyers.
The land reuse program has helped with the Youngstown 2010 plan for neighborhood revitalization, and also been used by Jubilee Urban Renewal Company, Spanish Evangelical Church and Belleria Pizza, among others, Reardon said.
Jeff Chagnot, director of the city's Economic Development Office, said Belleria officials took advantage of the program to purchase several parcels to relocate the business from Logan Avenue to McGuffey Road and Wick Avenue near Ursuline High School.
U.S. Rep. Tim Ryan of Niles, D-17th, spoke briefly and said the tax-lien sale and land reuse program are part of the positive revival needed to continue revamping of the city's image.
"People are starting to see the turnaround," the congressman said.