Highland County land bank board weighs future of state grant programs

The Highland County Land Reutilization Corporation (land bank) board discussed plans for the future of the state’s grant programs, which have been used to fund numerous land bank projects during the past two budget cycles, during their Thursday, July 3 meeting.

The meeting was held in place of, and in between, their usual June and July meeting dates, as the board will next meet Aug. 21.

As was the case with the past two biennial budget cycles, the Ohio Legislature has included a provision for funding the state Brownfield Remediation Program and Building Demolition & Site Revitalization Grant Program in 2026-27, land bank coordinator Jason Johansen announced.

“All 88 counties will receive a set-aside funding of roughly $480,000,” Johansen said of the Building Demolition & Site Revitalization program. “That's a rough estimate. That's slightly less than previous years, but it's still going to mirror the last couple programs that they've had with that, so there'll be no match requirement up to that $480,000.”

Johansen said he is keeping a “running list of properties” for consideration with the next grant cycle, with “roughly 15” potential locations thus far.

“I do urge the public to reach out to me if they have any structures they're needing torn down,” Johansen said.

The board also discussed whether they will want to include a provision for property owners to commit to pay a certain percentage of the demolition costs for the next round of building demolition programs but said they would wait to discuss the matter further with their attorney Todd Book, who was absent due to a vacation.

However, when speaking about the Brownfield Remediation program later in the meeting, board members debated the need for a match commitment from these property owners due to the more significant costs associated with property cleanup.

First, environmental consultant Matt Wagner of TetraTech spoke about the state budget process, which went from the budget initially not including either grant, to the House including $250 millions to the Senate cutting it to $200 million. 

Another change to the program is that it is again open to other entities, such as cities or villages, to apply for funding instead of just land banks, which the land bank faced with the grants in their initial two years.

“This first next round will be a million-dollar set-aside with no match, which is great,” Wagner said. “I think that's a huge win for Highland County.

“The next year, there's no set-aside, so it'll just be $100 million, but it won't be first-come, first-serve. That's always been the issue that we've had with counties like Cuyahoga, like how is Cuyahoga County getting 48 million and Montgomery County is getting three [million]? They're going to try to put some sort of scoring merit to it from an economic development/viability standpoint, and then I think also geography. They want to spread the money around the state.”

As discussed regarding the residential properties, board member David Daniels said the land bank needs to decide whether they want property owners commit to paying a portion of the brownfield remediation costs in the future. He cited the Rocky Fork Truck Stop (funded through both two-year brownfield grant cycles), a former gas station in Hillsboro and a former machine shop in Greenfield as examples of the “tremendous amount of money” the land bank has put into privately owned land.

“Yes, it's going to revitalize the area, and they're going to take advantage of it, but also, we've released some property owners of some pretty serious environmental problems that they end up with,” Daniels said. “I think when we start down through these programs, we're going to have to have some skin in the game from all these folks.

“I mean, we're already knee deep into Rocky Fork, but also, before these others start, if we're going to be looking at cost sharing on the [residential] demolition program, we ought to looking at cost sharing on some of this brownfield stuff.”

Wagner agreed, saying “it would be my recommendation to put a match on that” funding in the future, including for any cleanup of the properties currently under assessment with the present funding.

“Let's say you do the assessments, obviously there's some sort of contamination,” board member Lauren Walker said. “If the property owner decides not to have any skin in the game, what's their liability? We've kind of opened the can of worms that there's contamination.

“It would be their benefit to continue with the program. Well, let's say, if they don't have the money. They're liable now.”

“My recommendation at that point would be that they should donate the property to the land bank,” Wagner said.

Board president Terry Britton agreed, later saying that he wanted to ensure they have “the legal side” of this figured out with liability issues if the land bank starts and does not complete a project.

Walker also pointed out that it would be difficult to “go back and ask for a match” from property owners who have already “signed documents” about the grant funding that didn’t involve a monetary contribution. Daniels said it “doesn’t hurt to have some of those processes and some of those exceptions in place so people know that up front” instead of giving a “lottery ticket” to property owners.

“The taxpayers are funding this,” Daniels said. “The taxpayers have got to get something back out of it, especially if we're going to bear the entire cost of it. If we're going to clean up somebody's property, then we ought to be able to take it, resell it. We'll never get out of it what the environmental damage is, but at least we're not handing somebody a big gift.

“That's just my thoughts. I want to see these properties cleaned up, but also on the same token, I don't want to incentivize people not to be doing their due diligence before they buy them, and then all of a sudden say, ‘hey, look, now I need this cleanup, and I need you guys to do all.’”

Walker said they also need to consider whether the property owners have plans for “development” or doing “nothing” with the property.

“I think that would have to be done up front, prior to going forward with any of the brownfield [funding],” Britton said.

Walker also said they could ask the state about the option to “buy out” property owners, while Daniels suggested “capping” the amount spent per project. Wagner said that the land bank board’s next meeting in August would be the “perfect” time to make a decision before they apply for the next grants.

“It is certainly our intention to have these educated conversations with the landowners, as these reports are being finalized and we talk about critical next steps for the properties,” Wagner said. “We could say, ‘look, OK, the estimated cost for cleanup for your site is $500,000, and the land bank would anticipate you to commit a 25-percent match,’ if that's what it ends up being, and then that way, that's the discussion.”

Britton reiterated they would need to come up with a policy and “have those discussions up front” with property owners but agreed the truck stop is a good example of looking into Daniels’ suggestion. In response to a question from Daniels, Johansen said there is “just under a million” dollars in funding dedicated to that property thus far.

“That’s a pretty good scratch-off ticket,” Daniels said.

Daniels also pointed out that eventually, these grant programs will cease to be funded by the state, and they need to establish policies for the future.

“The legislature is only going to provide funding for so long,” Daniels said. “If we want to have sustainable programs here and we want them to carry on longterm, we're going to have to figure out a way that we're not spending every nickel and we're not getting anything in return. I mean, we've been pretty lucky for two or three funding cycles that they've done it, but sooner or later, their priorities are going to shift, and this money is going to go away.”

For an update on the projects currently underway through the state grant programs, Johansen reported that the state has approved a timeline extension request for nine Building Demolition and Site Revitalization properties.

The land bank board had to rebid the nine properties in May, as Johansen said the contractor notified him May 1 that the company could not complete nine of the 14 demolitions they were awarded. As a result, they requested to push back the timeline to the end of summer.

“[The Department of Development] went ahead and granted us an extension on the entire all 38 demolition projects,” Johansen said. “It's not just those nine. All reporting, reimbursements and everything will need to be submitted to ODOD by the end of third quarter, September 30, of this year.

“All demolitions with a June 20 deadline have been complete, except for the hot demo — that's where the asbestos is in the structure — at 937 North High here in Hillsboro, and then a project at 6950 Pence Road. That's where the contractor has to go over active septic lines, and the water sits very heavily on that property. He's waiting for it to dry up.”

Johansen said that two of the bid packages — opened at the May meeting — were awarded to the second-lowest bidders, as the apparent low bidder opted to withdraw upon further discussion.

“Evans Landscaping was the second-lowest on package X, and Grooms Asphalt Maintenance was the lowest on package Y,” Johansen said.

Bid package Z was awarded to Evans Landscaping in May.

Once those are complete, Johansen said he anticipates having $140,000 in unused funds remaining from this iteration of the Building Demolition and Site Revitalization program.

“In the past, they gave us that money back,” Johansen said. “I’m hoping that they do that again to let us spend it. I know on the Brownfield side, they don’t.”

Johansen also reported that the land bank will have to eat the cost of two “nonreimbursable” projects, totaling $1,424.59, on a property that was ultimately not demolished through the state program.

“That's for a $400 asbestos survey, and then $1,024.59 to have some oil drums removed, at 213 Broadway Street [in Lynchburg],” he said.

Wagner also discussed the land bank’s four current Brownfield Remediation Grant projects. For the East Monroe property in Leesburg, Wagner said they are awaiting “official approval” from the state from its cleanup.

“Tanks have been pulled, soil has been collected,” he said. “It does look like we'll be getting clean closure there to then ultimately get the no further action for the East Monroe tank farm, and that will then close that project.”

There are several different issues with a former machine shop in Greenfield, where tanks have been filled in, Wagner said. That includes a debate on the future of the building and some disagreements between the property owner and village, as well as questions on its cleanup process.  
 
“We're working with the current owner just to do some preliminary assessment work, just to ensure that soil vapors haven't migrated offsite,” Wagner said.

Contamination to the groundwater and soil at the former gas station in Hillsboro was previously identified, and Wagner said they will have to work with surrounding property owners to get access to test soil and groundwater. 

“The site does have impact,” Wagner said said. “Right now it looks as if it's potentially going offsite, so we're going to need to work through that and see what we can do terms of site access, similar to what we've done at Rocky Fork, where we get access from the adjacent property owners. We're working through that process right now.” 

For the Rocky Fork Truck Stop, Wagner said they hope to be done working at the site this fall, with a remedial action plan (RAP) “being finalized.

“The key with that site was that it just kept extending and extending, and the way that BUSTR [Bureau of Underground Storage Tank Regulations] works is you have to get your full arms around the environmental impact before they will allow you to do implement the remediation plan,” Wagner said. “We do have that, and now we're in the process of getting it remediated. It is ongoing, and the intention is to be done hopefully October, November. 

“All of these sites did receive extensions through December, but we won't need it for hopefully any of them, in terms of the projects.”

In other discussion:

• Johansen brought up several former churches, including one in Lynchburg and one in Marshall, around the county that are no longer being used. He said that he and Book are looking into options to possibly, eventually facilitate the cleanup of these buildings, which are seeing various problems due to being vacant for an extended time.

“As you know, churches are not taxed, so doing a tax foreclosure or purchasing tax liens is not possible,” Johansen said. “Of course, there's the donation route, but churches are usually in the hands of trustees, and it can be very difficult to track down the trustees of a church that has sat empty for years, and then if you do, they need the proper documentation showing that they have the authority to donate that property to the land bank. 

“Todd and I have been reaching out to some other land banks see what avenues they do with similar situations and churches. We believe the best route would be to contact the Ohio Department of Taxation and inform them that the property is no longer being used in alignment with their intended nonprofit mission. Since the church is no longer being used as a charitable purpose, it shouldn't be tax exempt. Once the property is being taxed, we would then pretty much wait to the two-year mark for it to be certified tax delinquent, and then we would possibly be able to send it for tax foreclosure or purchase the tax lien.” 

Walker suggested the land bank could also try filing a public nuisance complaint through the court system, as she said that is an avenue the City of Hillsboro has tried with a similar property. 

• For an update on other properties, Johansen said that the Gross Feibel demolition, which is being paid for through a partnership with the City of Hillsboro is slated to be completed by the end of September.

“I do want to remind the public that the land bank does not own Gross Feibel, and the end use is at the discretion of the city,” Johansen said.

TetraTech is completing property assessments on 11470 Spruance Road in Marshall Township, which the land bank now owns, to determine if it is a brownfield as Johansen suspects. 

Johansen said that he and Book are working to find a way to remove a trailer at 10635 North Shore Road, a property that was previously donated to the land bank.

“The person who donated us the land, his sister and the ex-husband who lives adjacent own this trailer together,” Johansen said. “If we can get ownership of the trailer with all this funding that's coming out with demolition, that would be ideal to have the title in hand and be able to have it demolished through the program.”

Similarly, for 11923 Elmhurst Trail in Paint Township, Johansen said they are trying to track down the lienholder of the trailer on that property.

“We just want to get the title in hand so we can use our demo funds to get it torn down and get the property cleaned up so that we can turn around and sell it,” Johansen said. “Both of those are some really good lots at the lake. I think they'd have a lot of interest.”

• The board authorized the payment of outstanding bills as of July 2. According to Johansen’s report, those invoices total $259,971.51, mostly for contracting work but also including charges for advertising, lawn care, legal fees, rent and salaries. 

As noted by Johansen, the amount owed exceeds the amount of money in the land bank’s bank account, as he is still awaiting requested reimbursements from the state for the contractors’ payments.

“I do want to just throw out there that we do have 45 days to pay the contractors for their work,” Johansen said. “All contractors got me all of their documentation on June 20 and some a few days after, so we're OK to pay them into the first part of August. I did let ODOD know, and they are going to expedite that request for us so that we can get that money drawn down, so she said they were working out about a 30-day processing period. 

“We currently owe $154,833 to demolition contractors, and the request was for $193,687 and then $19,368 in administrative dollars for the land bank, so there's about a $213,000 request there.” 

• The board approved the financial reports for both May and June as presented. According to Johansen, the land bank began May with a balance of $457,136.07 and ended June with $248,811.47, as one of the checks cleared in May was a $133,943.28 payment to Tetra Tech.

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