SB 142 — Land bank ordinances; disposition.

RECONVENED SESSION REENROLLED VIRGINIA ACTS OF ASSEMBLY --–– 2022 RECONVENED SESSION CHAPTER 713R An Act to amend and reenact § 58.1-3970.1 of the Code of Virginia, relating to delinquent tax lands;

E N [S 142] Approved AprilR 27,O 20221. Be it enacted by the General Assembly of Virginia:

1.

L A.

Except as provided in subsection B, in any proceedings under this article for the salesaleEof of a parcel or parcels of real estate which that meet all of the following:

(i) each parcel has delinquent real estate taxes or the locality has a lien against the parcel for removal, repair, or securing of aD building or growth,;structure;

(ii)removal eachof parceltrash, hasgarbage, anrefuse, assessed value of $75,000 or less,;litter;

andor (iii)the (a)cutting suchof taxesgrass, andweeds, liens,nor other foreign together, including penalty and accumulated interest, exceed 50 percent of the assessed value of thetheens, parcel or, (b) such taxes alone exceed 25 percent of the assessed value of the parcel, or (c) for parcels containing a structure that is a derelict building, as that term is defined in § 15.2-907.1, such taxes and liens, together, including penalty and accumulated interest, exceed 25 percent of the assessed value of the parcel, the locality may petition the circuit court to appoint a special commissioner to execute the necessary deed or deeds to convey the real estate to the locality in lieu of the sale at publicpublicSauction, auction, in lieu of the sale at public auction, to the locality, to the locality's land bank entity, or to an1n existing nonprofit entity designated by the locality to carry out the functions of a land bank entity pursuant to § 15.2-7512.

After notice as required by this article, service of process, and upon answer filed by thetheo owner or other parties in interest to the bill in equity, the court shall allow the parties to present evidence and arguments, ore tenus, prior to the appointment of the special commissioner.

Any 2 surplusage accruing to a locality, land bank entity, or existing nonprofit entity as a result of the sale of the parcel or parcels after the receipt of the deed shall be payable to the beneficiaries of any liens against the property and to the former owner, his heirs or assigns in accordance with § 58.1-3967.

No deficiency shall be charged against the owner after conveyance to the locality, land bank entity, or existingexi2. nonprofit entity.

2.

For purposes of this section,defined "existingin nonprofit§ 15.2-7500.rofit entity" and "land bank entity" have the same meaning as those terms are definedB. in § 15.2-7500.

B.For a parcel or parcels of real estate in a locality with a score of 100 or higher on the fiscal stress index, as published by the Department of Housing and Community Development in July 2020, all of the provisions of subsection A shall apply except (i) that the percentage of taxes and liens, together, including penalty and accumulated interest, and the percentage of taxes alone set forth in clause clauses (iii) (a) and (b) of subsection A shall exceed 35 percent and 15 percent, respectively, of the assessed value of the parcel or parcels or (ii) that the percentage of taxes and liens, together, including penalty subsection A shall exceed 20 percent and 10 percent, respectively, of the assessed value of the parcel or of parcels, and each parcel has an assessed value of $150,000 or less, provided that under this clause the property is not an occupied dwelling, and the locality enters into an agreement for sale of the parcel to a nonprofit organization to renovate or construct a single-family dwelling on the parcel for sale to a person or persons to reside in the dwelling whose income is below the area median income.

For a parcel or parcels of real estate in a locality with a score of 100 or higher on the fiscal stress index, as published by the Department of Housing and Community Development in July 2020, all of the provisions of subsection A shall apply except (i) that the percentage of taxes and liens, together, including penalty and accumulated interest, and the percentage of taxes alone set forth in clause clauses (iii) (a) and (b) of subsection A shall exceed 35 percent and 15 percent, respectively, of the assessed value of the parcel or parcels or (ii) that the percentage of taxes and liens, together, including penalty and accumulated interest, and the percentage of taxes alone set forth in clause clauses (iii) (a) and (b) of subsection A shall exceed 20 percent and 10 percent, respectively, of the assessed value of the parcel or parcels, and each parcel has an assessed value of $150,000 or less, provided that under this clause the property is not an occupied dwelling, and the locality enters into an agreement for sale of the parcel to a nonprofit organization to renovate or construct a single-family dwelling on the parcel for sale to a person or persons to reside in the dwelling whose income is below the area median income.

For sales by a nonprofit organization pursuant to subsection B, such sales may include either (i) both the land and the structural improvements on a property or (ii) only the structural improvements of aimprovements propertyis andpermissible notonly theif land(a) the structural improvements are locatedsubject on.to a ground lease with a community land trust, as that term is defined in § 55.1-1200;

A(b) sale of only the structural improvements is permissible only if (a) the structural improvements are subject of 2 to a ground lease withthat has a community land trust, as that term isof definedat inleast §90 55.1-1200;years;

(b)and (c) the community land trust retains a preemptive option to purchase such structural improvements areat subjecta toprice determined by a groundformula leasethat is designed to ensure that hasthe aimprovements termremain affordable in perpetuity to low-income and moderate-income families earning less than 120 percent of atthe leastarea 90median years;income, adjusted for family size.

and (c) the community land trust retains a preemptive option to purchase such structural improvements at a price determined by a formula that is of 2 designed to ensure that the improvements remain affordable in perpetuity to low-income and moderate-income families earning less than 120 percent of the area median income, adjusted for family size.