Land Banks in New Jersey

Across the country, over 300 land banks are mitigating the harms of vacant, abandoned, and deteriorated (VAD) properties on neighbors and neighborhoods, and advancing equitable, inclusive, and resilient communities. Land banks have profound positive impact in the communities they serve including stabilizing neighborhoods and property values of neighboring homes, addressing safety concerns, leveraging economic investment, furthering racial equity and social justice, and creating lasting affordability. New Jersey municipalities can form land banks pursuant to the 2019 New Jersey Land Bank Law.

When is a Land Bank the Right Tool? 

Communities must first understand the scale and scope of their VAD property challenges to determine if a land bank would be useful and effective at addressing them. New Jersey communities could consider forming a land bank if they experience the following: 

• Vacant and abandoned properties that bear delinquent property tax or other public debt that exceeds market value 

• Publicly owned properties the local government is struggling to maintain or dispose of in an equitable fashion 

• Inflexible public policies dictating the sale of public property, limiting the ability to be strategic and nimble 

• A public disposition process that lacks transparency, is highly politicized, and is vulnerable to mismanagement  

In New Jersey, land banks may exercise only those powers already enjoyed by and explicitly granted to the land bank by the municipality. Therefore, after determining the scope and scale of problem properties, it is important to assess whether an external entity like a land bank is needed to increase capacity and reach community goals, or if a municipality should look toward internal policy and practice changes. 

Because land banks receive most of their inventory from the tax enforcement system, their utility and impact diminish as real estate values increase and the pipeline of properties coming through the tax enforcement process dries up.   

New Jersey communities have access to several legal tools to address VAD properties, including Abandoned Properties Lists, Special Tax Sales for abandoned properties, Spot Blight Eminent Domain, and Vacant Property Conservatorship. If your community does not have a large inventory of problem properties but does have a handful of properties causing significant harm, these other tools might be worth exploring.