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Are Governor Cuomo’s economic policies good for Amsterdam? (Part One: Land Bank)

As we debate about and struggle to redefine and rebuild Amsterdam’s economy, it’s worth remembering that many of the hurdles we face along with many Upstate NY communities originate from the leadership and policies of our state government. Unfortunately, I think that news about state polices sometimes gets lost in the shuffle between the local news (which often seems more immediate and relevant) and national news which is so ubiquitous as it is delivered via the national networks. There are four important economic policies of NY State Governor Andrew Cuomo (D) that I see as worth taking a closer look at because I believe they are having a large impact on Amsterdam’s current and future economy:

  1. Land bank program
  2. Property tax caps
  3. Shared services/consolidation
  4. Tax free zones around state college campuses

The Land Bank Program

New York State’s Land Bank Program was signed into law in 2011 and less than a year later, the first five applicants were approved which included The Land Reutilization Corporation of the Capital Region, of which the City of Amsterdam is a part of. The lank bank allows people who are both knowledgeable and passionate about fixing the problems of blight in our neighborhood to work together under a common organization. It uses funds from both local governments and funds awarded to the State Attorney General’s office as a result of the National Mortgage Settlement.

According to nationalmortgagesettlement.com, an informational website maintained by 49 state attorneys general, the settlement was one of the largest of its kind and was a result of “federal investigations finding that the country’s five largest mortgage servicers (Ally/GMAC, Bank of America, Citi, JPMorgan Chase, Wells Fargo) routinely signed foreclosure related documents outside the presence of a notary public and without really knowing whether the facts they contained were correct.”

The land bank will acquire foreclosed properties in order to renovate them. Being a non-profit organization, the land bank could potentially save the city from having to pay the county and school taxes on that property if it is in the land bank’s possession for a long period of time. Once repairs to the property have been finished, it will be sold to private owners, putting the property back on the tax rolls. Part of the money from the sale will go to paying back loans from the city (assuming the Common Council will approve the funding this Tuesday) and the rest will be used to renovate more properties.

Up until now, the city has had no other strategy to deal with foreclosed properties other than demolition. But a developed property is always going to generate more tax revenue than a vacant lot. I believe this program will help preserve our housing stock which is one of the city’s most valuable assets. That’s why I have high hopes that this program will benefit our city’s economy positively in the future.

So I think this policy clearly works for Amsterdam’s best interests. I hope the common council votes to fund the program at this Tuesday’s meeting, it will be a good decision that every member can be proud of.

However, I’m not so unequivocally supportive of some of Cuomo’s other polices, and I’ll be looking at tax caps, shared services and consolidation in the next installment.

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About Tim Becker

Tim Becker is the owner of AnthemWebsites.com LLC which publishes The Compass. He serves as both editor and a writer.

12 Responses to Are Governor Cuomo’s economic policies good for Amsterdam? (Part One: Land Bank)

  1. Robert Purtell says:

    As we move forward in the next chapter of the history book of Amsterdam, NY, I feel that the “land bank” will play an important role in making Amsterdam a better place to live.
    The City Council has been very supportive of the “land bank” and I feel confident the City of Amsterdam will become an intregal part of the process.
    The community must also buy in to the process of making Amsterdam a better place to live. There are many opportunities to volunteer through out the community and any help would be appreciated.
    The next scheduled event that I know of is the City wide spring clean up scheduled for April 26, 2014. Lets see if we can make this the best clean up the City has ever seen!

  2. I think use of city services and funding for the land bank should be held until the local land bank committee presents a business plan to the Common Council describing planned financing and definite goals for the program. There seems to be suggestions but no clear vision for the future from what has been presented. Why isn’t Amsterdam’s Director of Economic Development a part of this plan? The Schenectady local land bank received $100,000. from Schenectady County and $50,000. from Schenectady’s Industrial Development Agency. Why isn’t the Amsterdam land bank approaching our IDA for funding? Until the City of Amsterdam’s finances are straightened out with a proposed budget, we should avoid this kind of discretionary spending.

  3. According to the city Engineer, the property at 52 Julia Street has already cost the city $6,000. in overtime cost from using city workers to work on property not owned by the city. This without a contract or agreement from the Common Council. I would like to save money by using city workers to repair my house too! Now the land bank is asking the city for $60,000. Just how is this land bank saving us money?

    • Tim Becker says:

      Jerry – the house was foreclosed on, there has been no tax revenue coming in from the property for years, but the city is having to still pay county and school tax on it.

      So the first way the land bank can save the city money is if the repairs take a year or so, they can take it off the county and school tax rolls because they are non-profit. Then once they fix up the property, they can sell it to a private owner so it can begin generating tax revenue.

      The money the land bank is asking for is a loan, the city will get it’s money back.

      By comparison, demolition costs over 40,000 and then you have a lot that generates next to nothing in tax revenue.

      What would be your solution, Jerry?

  4. I have no problem with the concept of the land bank and the regulation that NYS wrote for it to follow. They already own two properties to rehab and they are already asking a cash strapped city for money. The city did their part last year by giving them the property and now it is off the tax rolls. They are supposed to be a self sustaining entity. Where is their business plan? What kind of fund raising have they done? Have they applied for grants? Have they approached Montgomery County for money? Why didn’t the City of Schenectady give money to their land bank?

    All I am saying is Amsterdam should proceed with caution. Until the books are balanced and they locate that 1.2 million dollar mistake, the City of Amsterdam should not be loaning that kind of money. The land bank was created to take the financial burden off the city, not create another one.

    • Tim Becker says:

      They applied for the grant from the Attorney General’s office, but they didn’t get that much.

      Of course it’s supposed to be self-sustaining, but a certain amount of money has to be put in first.

      What Robert Purtell told the Common Council is that the AG is looking for community buy in. Could it be that we missed out last year because of the low amount of funding it’s gotten from the localities?

      Here’s a thought for you – how a community spends it’s money tells you where their priorities are. And if Amsterdam can’t come up with a relatively small amount of money like $60K toward this project, what does that say about what we value as a community?

      I was at the last CC meeting and Matthew Agresta and Ron Barone talked back and forth about finding the money, and my impression was that they didn’t seem to think it was going to be a problem.

      We have another chance for the grant this year. I think we need to show that Amsterdam is on board with the project.

  5. Just wanted to say that I enjoy your blog, I like to read both sides so that I can better understand what is going on in our city. I am trying to be better informed I appreciate you also Jerry responding to my posts on other sites as well, sometimes it is hard to respond online because people may interpret you as being sarcastic when you are not, again thank you, have a peaceful day 🙂

  6. Paul Dietrich says:

    I feel that as a City Amsterdam should support the Land Grant Program with a start up loan. This should be a win/ win program if it is ran correctly, although it should be watched closely so as not to get out of control and fall the way of other good intensions.

  7. Robert Purtell says:

    I do not know where the $6,000 figure came from for overtime, on the day of the trash pick up, there were two City employees there for 4-5 hrs, if my calculations are correct, that would be $ 600.00 per hr per man. I may be wrong about that but here is what I had been told it cost: two men, one laborer and one foreman, one garbage truck and one pick up truck, 15 tons of trash.

    Also the city had estimates to clean out the property, one estimate was for around $ 6,000 and another for $ 5,000. The public works department refused to clean out the property.

    • First of all the $6,000 figure came from you as quoted in the Recorder. “It cost the city between $5,000 and $6,000 to clean
      out the house with the volunteers, Purtell said.” Now you tell us DPW refused to clean out the property during regular business hours but did so when they were being paid time and a half? Sounds a bit like extortion to me. Son’t get me wrong, I am for this project. I just think there needs to be a little more transparency in what transpires. The public hears nothing for a year, then there is this big media blitz and front page story that may have not represented what really happened. The land bank either owns the property or they do not. The city is either still paying taxes on it or they are not.

      • Robert Purtell says:

        Ok so for clarification, I may have been misquoted, I don’t have the paper in front of me, What it should have said was the engineer received a bid to clean out the house from a company for $6,000 which also included the city paying for the tipping fees. I also received a quote from a company I use and it was over 5,000. Also to correct what I said or was misinterperted, the dpw was asked to clean out the house this summer or fall and when they looked at the project they decided that they did not want to complete the task. I hope that this clears up the issue. Please feel free to call me on my cell if you have any other questions, I respect your opinoins.

  8. Robert Purtell says:

    I have delivered A written plan to the common on two occaisions. We have applied to the NYS Attorney Generals office for funding, 7 of 9 land banks received funding, we did not, the AG felt that the Citys of Schenectady and Amsterdam were not in motion and had not bought into the process. Mean while Rochester receieved 2.6 million dollars and matched that with funding from the city and other entities, including private funding.
    The only people benifitting from this is the City of Amsterdam, I would guess I would expect that the major stakeholder of the process buy in.
    The Land Bank Advisory Committee has planned extensively over the past year to put this in motion. So often our mentallity is to discuss things over and over until we miss the opportunity to succeed.