St. Petersburg administrators are updating their city-owned land policies and hope to help fund affordable housing initiatives by selling surplus parcels.
However, homeowners abutting slivers of remnant property deemed “unbuildable” can buy the land for $10. Aaron Fisch, director of real estate and property management, presented the new surplus “disposal” policy to city council members during an Oct. 12 committee meeting.
Fisch said the city currently owns 25 unbuildable parcels that each encompass less than 250 square feet and abut a residence. Most are along the Interstate 275 corridor, and a 2015 resolution allows adjacent owners to buy the property for $10.
“This was done … to have a more economical way to dispose of properties that the city has had on the books for many years,” Fisch explained. “It’s worked to an extent.”
The mayoral administration will charge market value for unbuildable land abutting commercially zoned property and buildable residential and commercial surplus parcels encompassing over 250 square feet. Fisch said the city owns nearly 1,000 buildable properties, although most are unavailable.
Administrators also established a minimum 30% affordable housing goal for proposed projects featuring four or more units. Developers could eschew that requirement and pay market rates for the land.
Fisch said the city typically acquires unbuildable properties through unsold tax deeds. While most are “little slivers of land,” he said some are large enough to accommodate various uses.
Fisch noted that many residents believe the parcels are part of their property. He said the city began with about 50 of those lots when officials implemented the 2015 resolution.
Amy Foster, housing and community services administrator, said city officials annually notify adjacent residents of the surplus property. They believe the 250 square feet threshold can provide additional housing funding through parcels too small for new projects.
Councilmember Copley Gerdes noted that homeowners to the left and right of a parcel valued at $21,000 could buy the land for $10. However, the city would charge market value if they forgo the discounted rate.
“I know we want to put that in the housing fund,” Gerdes said. “But if he (the adjacent resident) could buy it for $10 now, why would he (the other adjacent resident) buy it for $21,000 tomorrow?”
City Administrator Rob Gerdes said homeowners could use those slivers of land when redeveloping their properties. Foster noted that Council Chair Brandi Gabbard and other city officials have previously expressed concerns over someone benefiting from the city’s property disposal policy.
“The market is very volatile right now, and we may dispose of something that people could make a considerable amount of money on that moving forward,” Foster said. “So, we talked about how we might address that with some resale restrictions.”
Foster said the updated policy provides administrators with “the first right of refusal to reacquire the property or units.” They could also implement development timelines, mandate affordability periods and charge “liquidated damages for non-performance.”
Administrators will also decide how to allocate proceeds from property sales. Foster said the money would benefit the Housing and Capital Improvements Projects (HCIP) fund whenever possible.
She said the Affordable Lot Disposition Program (ALDP) would remain under the updated policy. However, Foster said city housing officials could soon present changes that allow duplexes on those properties rather than single-family homes.
“I think when this program was established, there was this idea that we wanted to allow lots of folks the opportunity so we could build the capacity of builders in our community,” she added. “But after reviewing the data surrounding that, we kind of have two groups of people – the people who can build a property in two years or less, and the people who hold on to a property for four years or more.
“We believe that the priority of this council and this administration is that we need housing today.”
Administrators have also created a city-owned property database in accordance with Senate Bill 102. While administrators prefer sold parcels to feature or fund affordable housing, Foster noted they could still lease property as an alternative.
Gabbard said the inventory database and affordable housing goals would provide a “much clearer direction” for developers. She said administrators also ensured the updated city-owned land policy does not impede other programs, like the Community Benefits Agreement (CBA).
The Housing, Land Use and Transportation Committee unanimously approved a resolution supporting the policy changes. However, it might not have much of an effect on the city’s affordable housing stock.
“In this exercise, we learned that there isn’t anything surplus,” Foster explained. “Everything is currently in city use or reserved for future city use, with very rare exceptions.”