MSHDA Blight Elimination Program

MSHDA Blight Elimination Program

Responses to Blight Questions

Questions regarding ownership of blighted properties:

Question: Is public ownership absolutely mandatory? We have several court orders to demolish vacant, blighted structures that we do not own.

Answer: The public ownership requirement is absolutely mandatory.

Question: Do the properties need to be owned by the applicant? Or can they be privately held?

Answer: They must be publicly owned.

Question: What if the property is blighted and permission is provided by the property owner for demolition?

Answer: The property must be owned by the municipality. If it is not publicly owned, it is not eligible.

Question: I wanted to clarify whether or not the subject property has to be publicly owned. In short, we would look to use these funds to assist in the demolition of all or part of the XXX Mall. The long-vacated structure once housed over 1.4 million square foot of retail space on a 74 acre parcel. The building has been declared dangerous through our Dangerous Building process and has residential neighborhoods to the south and west. We are aware of a purchase agreement for the property and our Township Board has adjourned our Dangerous Building process to correspond with the due diligence period associated with the purchase agreement. So, YYY Township has no intent of actually acquiring this property.

Answer: The subject property would have to be publicly owned to be eligible.

Question: Do the properties need to be publicly owned at the time of the application or what is the time period for acquiring the properties?

Answer: The properties must be publicly owned at the time of demolition.

Question: We are working with a local community that has an Option to Purchase on a vacant and blighted property and are exploring the MSHDA Blight Elimination Grant. Would that qualify for the “Publicly-Owned” eligibility requirement or would they have to be the actual deed holder to qualify?

Answer: The properties must be publicly owned at the time of demolition. They could have an option to purchase contingent upon receiving a grant, and if they were awarded a grant they could then exercise the option and purchase it prior to demolition.

Question: Do we have to own the property before we can proceed with demolition or can we use our code case procedure where city council deems it a nuisance and to be torn down and pay for demo that way without acquiring?

Answer: You must own it.

Question: I see that the blight grant can only be used on public property. How can this money be used to help demolish a building downtown that is not publicly owned? Can we have it quick deeded to the city and then sold back to the original owner?

Answer: No, you cannot have the property quit deeded to the city and then sold back after demo.

Question: We are quasi-governmental (a land bank). Do our properties count as publicly owned?

Answer: Yes.

Question: I realize the property has to be publicly owned, with the proposal due in June would properties that are in process of being publicly owned by August be eligible?

Answer: Yes, would be eligible. They have to be publicly owned at the time of demolition.

Question: I have been working with communities previously on blight elimination and XXX Township has a very active little community of business owners and some nice place making initiatives going on. They have for several years been trying to identify ways to strategically demolish blighted structures that if you are aware are on US-2 the main corridor throughout the U.P. I am confused about one thing for this grant program- the public ownership. These buildings are privately owned and if they were demolished would lead to development. For them to be eligible, would the private owners have to sell the buildings to the Township and then the Township sell them back to the private sector for development (for tax capture)? Other than this issue, we have a viable project and I just want to see how the public vs. private ownership issue comes into play in hopes it's not a deal breaker.

Answer: Properties must be publicly owned to be eligible. If the plan is for the city to buy the properties for demolition and then sell them back to the previous private owners, that would not be an eligible project. Please note if these are commercial properties, they must be in or adjacent to a residential area and part of a development project with funding commitments.

Questions about who can apply:

Question: Can a Third Party Administrator apply on behalf of a unit of government, or can the unit of government identify a Third Party administrator to run the program when applying?

Answer: The local unit of government must be the applicant. They certainly can enter into a formal written agreement with a third party to administer the grant, in the event they are awarded funds. They should describe this in their application, and provide an explanation of the capacity of both the local unit of government as well as the third party to appropriately administer the funds.

Question: Can a DDA apply or do we need to partner with the city or county land bank?

Answer: The application will need to come from the city or the land bank.

Question: Do we need to partner with a nonprofit?

Answer: No.

Question: Because this isn’t Hardest Hit Funds, we don’t need a blight partner, correct??

Answer: Correct. You do not need a blight partner.

Question: Just a small populated township in ZZZ County. Would this grant be applicable to our township? We have several vacant buildings. I know many other townships do as well.

Answer: The township is an eligible applicant. The properties would need to meet the other criteria outlined in the NOFA.

Question: I wanted to check in before we started to put together an application for the Blight Elimination grant, and I wanted to make sure that as a public preK-12 district are we eligible to apply?

Answer: The only eligible applicants are local units of government (counties, cities, townships, or villages) and local Land Banks. As such, you are not eligible to apply. Can you get ZZZ City to apply?

Questions about minimum/maximum grant award:

Question: I’m from XXX County Land Bank. If we are applying for an award, would we use the community that we are (XXX County) or the community we intend to concentrate on (a municipality) for the award ceiling?

Answer: The municipality.

Question: If a county land bank is the applicant, can it apply for properties in multiple municipalities? Or would each municipality application need to be separate? If the land bank is the applicant, do we go by county wide population in terms of determining the minimum/maximum grant amount?

Answer: A county land bank can apply for properties in multiple municipalities. If a land bank applies for demo in only one municipality, the minimum/maximum will be based upon the population of that municipality. If the land bank applies for properties in two or more municipalities, the minimum and maximum will be based upon the county population.

Question: Is the noted cap a hard cap? Can the project exceed the cap so long as the requested support does not?

Answer: The cap is on the grant funds, not the total demolition costs.

Question: The project we are looking at is a very large building in the heart of the city that has been on the wish list for a demolition project for some time now. For a community of this size the maximum award amount is $250,000. However, for a commercial structure the grant would cover $100,000 and a 10% match is needed. Is that correct?

Answer: Regarding the maximum grant amount of $250,000 – that would be based upon demolition of more than one structure. If the application is for just one commercial structure, the maximum amount would be $100,000. For commercial demolition, in addition to the match of 10% there are several other requirements. These include:

The property must be in or adjacent to a residential area; and
The demolition must be part of a development project with funding commitments.

Questions about proposed demolition:

Question: We are considering demolition of a blighted hotel in the business district of a small village. The hotel is not immediately adjacent to housing, but is in the near vicinity of housing in all directions (North – 400 feet, South – 300 feet, East – 400 feet, West – 1,400 feet). Does it qualify?

Answer: We would need to see the proposed demo on a map that also identified the housing. Commercial demo must be in or adjacent to a residential area.

Question: We own vacant land where the structures were previously demolished via this program, however there are above-ground metal phone/electric utility boxes that need to be removed. Would this type of demolition be eligible for funding?

Answer: Demolition of above-ground utility boxes left from a previous demo are noteligible.

Question: Can we apply for both residential and commercial funds?

Answer: Yes.

Question: If a property s commercial on the bottom and has residential units on top is that eligible?

Answer: Yes.

Question: The county owns a property with a blighted structure that, if removed, would open up the possibility for development in the area. I don’t want to utilize resources to complete this application unless I can be fairly sure it will qualify.

Answer: Is the structure residential or commercial? If it is commercial, it must be in or adjacent to a residential area AND part of a development project with funding commitments. Commercial demo also requires a local match of at least 10%.

Question: I know that in order to be eligible for this program, structures must be publicly owned. The City has a bath house building along its riverfront marina that houses bathrooms and showers. It has been closed for several years and is in extremely poor condition and I was wondering if it would be eligible for demolition through this program, since it’s really not a “residential” or “commercial” building. The City is currently in the process of some riverfront development projects and demolition of this structure would help facilitate this.

Answer: Since the structure is clearly not residential, we would treat it as commercial. As such, it would need to be in or adjacent to a residential area. The demolition would also need to be part of a development project with funding commitments, and must include a local match of at least 10%.

Question: I’m thinking that our project may not fit the requirements. It’s actually a Super Fund site that the county has converted to an industrial park. There is still 1 vacant office building that is a source of blight on the property. The building I am referring to in near the Southern boundary of the property. Since it is not adjacent to residential, are we not qualified? We could provide a local match.

Answer: If it is not in or adjacent to a residential area, it is not eligible. The fact that the property has been converted to an industrial park is also a problem, in that demolition of industrial property is not eligible.

Question: We have a blighted commercial structure that is smack dab in the middle of the downtown area. The downtown area is one street, and behind it is all residential. That should qualify it, shouldn’t it?

Answer: That sounds like it probably would work – we will need to see a map demonstrating it.

Question: Can the city identify more than one target area? For instance, there are two non-contiguous areas in which current and new private (and public) investment and development is ongoing.

Answer: Yes.

Question: For commercial demo, that must be part of a development project -- does the development project need to be on the actual site of the demolished building? We have blighted commercial next to or very near a development project. Would that qualify?

Answer: The demolition of the commercial structure must be part of a development project. If the development is not on the site of the demo, then you would need to make a case that the demo is removing blight in a manner that is supporting the development project.

Question: For the development requirements, would MSHDA consider commercial properties with nearby redevelopment efforts, or does it have to be redevelopment specifically on that property?

Answer: You will have to make a case that the demolition of the commercial property is directly tied to and in support of the development project, and not just nearby.

Question: I was wondering if public buildings would be considered. We are expanding our Waste Water Treatment Plant due to capacity issue. This project will require demolition of our current DPW facility and relocation of that facility that I’m sure would be considered blighted, to make room for the expansion.

Answer: I don’t think your project would qualify, as it sounds more like an industrial facility. If you want to make the case that it is commercial rather than industrial, you will also have to make the case that it is in or adjacent to a residential area AND part of a development project with funding commitments (and a local match of at least 10%).

Question: I have a city that has a defunct wastewater treatment plant. The property is zoned "public area" and is surrounded by residential. It is not zoned industrial, but would you consider this industrial and thus ineligible for the current round of funding?

Answer: As the structure is neither residential nor commercial, it would be considered industrial and therefore not eligible.

Question: The City owns a site in our Downtown has been marketed to developers for reuse for nearly three years. No buildings remain on the site, however there between 180,000 and 195,000 square feet of concrete on the site that is a large impediment to redevelopment and reuse. The site is zoned I-1, light industrial, however, there is no building left on the property would simply this zoning designation make the project ineligible even without the actual industrial building existing?

Answer: The project would be considered industrial, given the zoning. As such it is ineligible.

Question: Are apartment complexes eligible? If so, is that still eligible to request assistance per structure up to the cap?

Answer: As noted in the NOFA, residential properties must have a last use as single-family or multifamily 1-4 units. An apartment complex that is no more than 4 units is eligible, and counts as 1 structure.

Question: The city of XXX has a large inventory of property, approximately 50-60 homes, some of the properties may be able to be sold we are still evaluating them. I was wondering if I should give you particulars on all the properties or select 20 or so that I believe are the worse in the city. Also if I submit the documentation are we locked in doing those properties?

Answer: You should submit the properties for which you are seeking grant funds for demolition, as those are the ones that will be evaluated during our review process. If you were to be awarded a grant and wanted to change properties, we would consider that a request to amend the grant. Whether or not we would approve such an amendment would depend upon our judgement as to whether your proposal would have scored the same during the review process with the different properties.

Question: I have a property that appears to be an office building/potentially apartments. It is unknown what the last actual use was, but the assessor has had it classed as residential for at least 20 years. I don't believe it was ever used as apartments…based on what is inside was probably used as an office. I was planning to treat this as a commercial property just based on the look of the building, but now I am wondering whether it should be treated as residential because it is classed as such? How do you make the determination?

Answer: If the last use was as apartments, the question would be how many units were in it. If there were 1-4 units, it would be considered multifamily residential. If there were more than 4 units, it would be considered commercial.

Question: We are planning to partner with a local non-profit after demo of a commercial property to do native plant restoration with walking paths to beautify the area post-demo. Would this beautification count as a redevelopment plan for a commercial property?

Answer: No, we would not consider that to be a development plan. That sounds more like a plan to turn it into green space and holding it for future development.

Question: Our Landbank has a very blighted commercial property in our downtown. This property is in a downtown historic district and that district is listed in the national register of historic places. Does this make the property ineligible? Or would it be eligible if the local historic district approved the demolition?

Answer: If the property is listed in the National Register of Historic Places (either individually or as part of a historic district), it is not eligible. If the property is not listed above but is located with a local historic district designated under PA 1970 169 it is also not eligible UNLESS it has already been approved for demolition by either SHPO and/or the local historic district commission.