Article V. Disposition of Properties

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Section 5.01 Disposition Types

  1. All PLB Property Dispositions will be categorized as one of the following disposition types:
    • Residential Structures;
    • Vacant Land;
    • Side Yards; or
    • Commercial Properties
  2. General considerations, prohibitions, and procedures applicable to each disposition type are set forth in Sections 5.02, 5.03, and 5.04. Processes and considerations specific to each disposition type are set forth in Sections 5.05 - 5.07 and Article VI.

Section 5.02 General Considerations Applicable to All PLB Disposition Types

  1. The PLB will prioritize its disposition resources, including any dollars allocated for demolition, maintenance, and renovation, based on the following general criteria:
    • In neighborhoods with an active neighborhood plan or plans, developed with direct input from neighborhood residents, organizations, and institutions, when available.;
    • Where the targeted elimination of blight will make an impact on the overall stability of the neighborhood;
    • Where unrestricted dollars can bridge funding gaps to stabilize neighborhoods and preserve property values;
    • Where an investment will support mixed-income development; and
    • Where an investment will leverage funds from existing federal, state, or local housing programs.
  2. Transactions will be structured in a manner that permits the PLB to enforce conditions upon title pertaining to development and use of the property for a specified period, consistent with these Policies and Procedures.
  3. The proposed end use should include consideration of any formally Adopted or Accepted Plans. An expression of community input for the proposed use submitted by neighborhood groups or the Pittsburgh Department of City Planning will be considered in any final decision of the PLB.
  4. The proposed end use must follow current zoning and special use requirements, or a rezoning or variance must be obtained as a condition of the transfer.
  5. Options to purchase PLB property may be available under terms negotiated by the prospective end user and the PLB. Any option fee will be credited to the purchase price at closing. If closing does not occur, the fee is forfeited.
  6. In every transfer of Real Property, the PLB will require good and valuable consideration in an amount determined by the PLB in its sole discretion and consistent with these Policies and Procedures.
    • The Consideration Amount for a property shall be equivalent to the fair market value of the property, but not less than $500 (except as set forth in Section 5.07 regarding Side Yards). The Board of Directors shall provide guidance to PLB staff on methodology for determining fair market value, but staff shall have final discretion.
    • The PLB prefers that the Consideration Amount be paid in cash at closing. The PLB may, at its discretion, accept deferred financing, performance of contractual obligations, or performance of other obligations and responsibilities of the transferee in lieu of cash.
  7. The PLB reserves the right to convey or not to convey Real Property, or to convey Real Property in the way that constitutes the best long term end use for the property and for the neighborhood. Considerations under this section include preserving access to adjacent property and preserving or promoting good planning practices.
  8. If the rules of an external funding source or federal, state, or local laws and regulations require a disposition outcome that is contrary to these Policies and Procedures for a particular property, the PLB will comply with those rules, laws, or regulations.

Section 5.03 Owner and End User Qualification

The PLB shall sell property to only Qualified End Users. Qualified End User shall mean an individual or business entity that, in addition to any specific requirements determined to be appropriate by the PLB or set forth in Section 5.05 (Residential Structures), 5.06 (Vacant Land), 5.07 (Side Yards), or Article VI (Commercial Properties), satisfies the following requirements:

  1. Owns no real property that:
    • Has any unremediated citations or violations of the state and local property codes and ordinances, or has a recent history of such violations;
    • Is tax delinquent, or was tax delinquent when the prospective end user transferred the property and the property remains tax delinquent;
    • Was subject to a judgment in a tax foreclosure proceeding in the past five (5) years; or
    • Has a delinquent water account with the City of Pittsburgh’s Water and Sewer Authority, or any other local water utility, whether the water account is for a property the prospective end user occupies or a property occupied by a tenant, land contract vendee, or family member of the prospective end user.
  2. In addition, an individual or business entity that was the owner of a property at the time of the tax foreclosure action which transferred title to the PLB may not subsequently qualify as a Qualified End User for that property.
    • For this section, ineligible parties include shareholders, partners, members, and officers of the business entity owner and immediate family members of the individual owner.

Section 5.04 Disposition Procedures Applicable to All PLB Disposition Types

  1. The PLB disposition process shall be initiated by a prospective end user submitting a Property Transfer Application to the PLB. Property Transfer Applications for all disposition types shall be made available to the public by the PLB through the PLB’s website.
  2. Upon receipt of a Property Transfer Application, the PLB shall determine if the applicant is a Qualified End User.
  3. The PLB will accept Property Transfer Applications for a property until PLB has entered into a Purchase and Sale Agreement with a Qualified End User. Should PLB receive multiple Property Transfer Applications for a property, priority for selection will be based on the factors outlined in Section 5.05(F) (Residential Structures), 5.06 (Vacant Land), 5.07 (Side Yards), or Article VI (Commercial Properties)
  4. The PLB, in its discretion and in a manner consistent with these Policies and Procedures, including any additional policies and/or considerations set forth in Section 5.05 (Residential Structures), 5.06 (Vacant Land), 5.07 (Side Yards), or Article VI (Commercial Properties), shall determine a Consideration Amount and select a Qualified End User.
  5. Online Public Notice. Upon selection of a Qualified End User, the PLB shall, within a reasonable time of such selection, provide public notice on the PLB’s website of the proposed disposition. The online notice shall be posted at least thirty (30) days prior to any the execution of a Purchase and Sale Agreement (as set forth in (H) below). Online notice shall include, at a minimum, the name of the proposed purchaser/Qualified End User, the Consideration Amount, and the proposed use in sufficient detail to enable the public to understand the public benefits and neighborhood impacts. The PLB shall also provide a mechanism through which interested parties, including community organizations, may request and receive timely notifications of any proposed change in the status of any property or properties owned by the PLB.
  6. Signage. Upon selection of a Qualified End User, the PLB shall, within a reasonable time of such selection, post notice of such selection on weatherproof signs on the subject property at least every one hundred (100) feet of street frontage up to a maximum of ten (10) signs. The signage shall be posted at least thirty (30) days prior to any the execution of a Purchase and Sale Agreement (as set forth in (H) below). Required signs shall be placed along the perimeter of the subject property in locations that are clearly legible from adjacent public streets. Required signs shall provide the name of the proposed purchaser, a description of the proposed reuse of the property and describe the process by which any Interested Parties may object.
  7. Objection Process: Interested Parties may file a petition within twenty (20) days of the PLB’s posting of online notice or signage in order to object to disposition of land. In the event that the PLB receives a petition signed by fifteen (15) or more Interested Parties, the PLB shall hold a predisposition Public Hearing in the neighborhood. The PLB may thereafter approve a disposition request only if:
    • It determines, based on testimony received at the Public Hearing, that the disposition would be consistent with the goals and needs of the neighborhood and that is likely to benefit the neighborhood in which the property is located; and
    • The disposition is approved by a two-thirds vote of the entire Board of Directors.
  8. Upon notification from the PLB that a Qualified End User has been selected for the disposition of a property, or that a disposition has been approved pursuant to Section 5.04(G) above, a Qualified End-User shall have thirty (30) days to enter into a Purchase and Sale Agreement for the property. The Purchase and Sale Agreement shall set forth a closing date, and contain, in addition to any requirements set forth in Section 5.05 (Residential Structures), 5.06 (Vacant Land), 5.07 (Side Yards), or Article VI (Commercial Properties), provisions that the PLB’s obligation to close on the sale of the Property to the Qualified End User is contingent upon, among other things:
    • The Qualified End User’s payment of the Consideration Amount at closing;
    • The Qualified End User’s execution of a Renovation Enforcement Note and Mortgage, or reverter deed (if applicable);
    • The Qualified End User remaining in compliance with Section 5.03(A) above.
  9. Closing on the disposition of a PLB property to a Qualified End User shall take place on the date set forth in the Purchase and Sale Agreement. A local title company shall serve as closing agent and, if required, escrow agent.

Section 5.05 Residential Structures

  1. Residential Structure(s) shall mean any improved parcel that is located:
    • Within any area zoned for residential property per Title Nine of the Pittsburgh Municipal Code with a current residential use; or
    • Within any zoning district and has a valid Certificate of Occupancy designating it as a residential property.
  2. Every Residential Structure acquired by the PLB and determined to be marketable after a complete condition and marketability assessment will be marketed to the public and available for a prospective end user to purchase.
  3. The PLB will determine the initial listing price Consideration Amount for a Residential Structure pursuant to Section 5.02(F) above.
  4. Property Transfer Applications for Residential Structures will only be accepted from prospective end users after the PLB has begun marketing the property to the public with a clear opportunity for title.
  5. Qualification of End Users for PLB dispositions of Residential Structures will generally adhere to the conditions and processes set forth in Section 5.03 above. The PLB shall require the following information to qualify prospective end users of Residential Structures:
    • A plan for the complete renovation for the Residential Structure that will make the Residential Structure safe and habitable and return all of the Residential Structure’s system to functional condition (the “Renovation Plan”) per local Code and building standards as enforced by the Department of Permits, Licenses, and Inspections; and
    • Proof of funding immediately available to acquire and complete the work as set forth in the Renovation Plan for each Residential Structure to be acquired and renovated. Acceptable proof of funding includes cash on-hand, available credit, and other liquid assets. Financial assistance offered by a friend or relative may not be accepted unless the individual or entity offering assistance is also an applicant;
      The PLB may, at its discretions, require the following additional information to qualify prospective end users of Residential Structures:
    • Expressions of Input from neighborhood-based organizations, renovation partners, lenders, purchasers of previously renovated properties, current or former tenants, and any other relevant parties;
    • Proof of prior experience successfully renovating Residential Structures, including photographs of work undertaken and completed, and a narrative describing past or current projects; and
    • Any additional information the prospective end user wishes to share with the PLB that relates to the renovation project.
  6. PLB will use the following as priority guidelines for selecting between multiple Qualified End Users who have each submitted a completed Property Transfer Application:
    • Low- to Moderate-Income Owners Occupants verified by the PLB; then
    • All other owner occupants; then
    • Owners renting to immediate family members verified by the PLB; then
    • Rental, land contract, or resale opportunities.
  7. In selecting among multiple Qualified End Users with equal priority under Section 5.05(F), the PLB will exercise discretion to select the Qualified End User that PLB Staff believes will develop the property in a manner most consistent with the PLB’s mission statement as set forth in Section 1.01.
  8. PLB dispositions of Residential Structures will generally adhere to the disposition procedures set forth in Section 5.05 above. In addition, the following supplementary considerations and procedures shall apply to the PLB’s disposition of all Residential Structures:
    • The Purchase and Sale Agreement shall reference the Renovation Plan.
    • The purchaser shall complete the renovation work on the property pursuant to the Renovation Plan, and secure and provide proof of a temporary or permanent occupancy permit within a negotiated renovation time period. The Purchase and Sale Agreement will contain provisions setting forth these terms and conditions.
    • At closing, the purchaser shall execute either a renovation enforcement note and mortgage, a deed-in-escrow, or a reverter deed. PLB staff will, at its discretion, determine which documents are appropriate for each transaction.
    • Renovation Enforcement Note and Mortgage: Title will transfer to the purchaser at closing, at which time the purchaser will personally execute the Renovation Enforcement Note and the Renovation Enforcement Mortgage, which will secure the subject property. The amount of the Renovation Enforcement Note shall be the greater of the sale price of the property or the PLB’s projected renovation costs for the property. When the renovation work is complete and either: 1) the purchaser has secured and provided proof of a temporary or permanent occupancy permit or 2) the property has passed the PLB’s safety and habitability inspection, the PLB will provide the purchaser with written confirmation that the property is safe, functional, and habitable in satisfaction of the PLB’s conditions and will record a satisfaction of the Renovation Note and Mortgage.
    • Deed-in-Escrow: The PLB will retain title to the property at closing, and the deed transferring title to the purchaser will be held in escrow with the closing agent. The PLB will issue a notice to proceed allowing the purchaser to move forward with the renovation work. When the renovation work is complete and either: 1) the purchaser has secured and provided proof of a temporary or permanent occupancy permit or 2) the property has passed a safety and habitability inspection, the PLB will instruct the closing agent to transfer title in the property to the purchaser.
    • Reverter Deed-in-Escrow: Title will be transferred to the purchaser. The purchaser will simultaneously execute a deed transferring title back to the PLB held by the escrow and title agent during the renovation time period. The deed held in escrow will be voided and released upon PLB confirmation that either: 1) the purchaser has secured and provided proof of a temporary or permanent occupancy permit or 2) the property has passed the PLB’s safety and habitability inspection.
    • Purchaser’s failure to renovate the subject property in a manner consistent with the Renovation Plan during the renovation period as set forth in the Purchase and Sale Agreement, failure to comply any terms of the Purchase and Sale Agreement, or failure to comply with the terms of any other agreement between the purchaser and the PLB, shall, at the PLB’s option, constitute an Event of Default. Upon the occurrence of an Event of Default, the PLB shall notify the purchaser in writing, and may, at the PLB’s option, provide a period of time in which to cure the Event of Default. Upon the occurrence of an Event of Default, and the expiration of any applicable cure period, the PLB shall seek any remedies it deems appropriate. The PLB may permit a purchaser to convey a property back to the PLB in lieu of payment of the indebtedness and foreclosure.
    • Residential Structures shall not be rented, occupied, further mortgaged, or otherwise encumbered during the renovation period. If a purchaser intends to encumber the property with a third party mortgage required to obtain purchase or renovation financing, the PLB may subordinate its Mortgage against the property to enable renovation work to occur.
  9. In addition to the disposition procedures and considerations set forth in Section 5.04 and Section 5.05(H), the following considerations shall apply to the PLB’s disposition of Owner Occupant Residential Structures:
    • Prospective end users who wish to acquire and renovate residential property as owner occupants may be referred to a HUD-certified housing counseling agency for a homeownership and financial literacy evaluation and counseling. Prospective end users may enroll at their discretion.
    • Qualified End Users who are Owner Occupants and who satisfactorily complete a financial literacy and homeownership evaluation will be given purchase priority for PLB property, with particular priority to low-income individuals and affordable homeownership.
    • Prospective end users who do not satisfy the requirements to become Qualified End Users, and/or who are unable to satisfactorily complete a financial literacy and homeownership evaluation may be required to complete mandatory financial literacy and homeownership counseling before being qualified as an end user.
    • The PLB may waive the requirements of this section if a prospective end user can demonstrate the financial wherewithal to acquire, renovate, and maintain the property without incurring undue financial hardship.
  10. Marketing of Residential Structures
    • The PLB will list all properties that may be acquired and renovated under its Residential Structure program on its website.
    • Properties under the Residential Structure program may be listed with a licensed, professional real estate firm (“Realtor”). The Realtor will serve as the PLB’s agent and primary point of contact for that property.
    • The PLB will consider a Realtor’s opinion of value when setting the initial Consideration Amount purchase price of a property listed with a Realtor.
    • The PLB will pay a fixed commission to the property’s Realtor of $x,xxx or x% of the Consideration Amount, whichever is greater, at closing. If a listing agreement terminates without the property’s sale, the PLB may pay the property’s Realtor a fee for a listing activity report in the PLB’s sole discretion.
    • Properties for which renovation and occupancy are possible will be exclusively available to owner occupant end users (including bona fide renovation for resale to an owner occupant and family renovation end users at the PLB’s discretion) for at least twenty (20) days following listing. The owner occupant exclusivity period may be extended or shortened by the PLB on a case-by-case basis.

Section 5.06 Vacant Land

  1. The PLB may sell, lease, or license vacant land to non-adjacent Qualified End Users at its discretion.
  2. PLB dispositions of Vacant Land will generally adhere to the disposition procedures set forth in Section 5.04 above. In addition, the following supplementary considerations and procedures shall apply to the PLB’s disposition of all Vacant Land.
    • If Vacant Land is eligible to be developed for new residential, commercial, or industrial use, the PLB may offer the vacant land for sale for “immediate development” at a Consideration Amount determined pursuant to 5.02(F) above. For purposes of this section 5.06, the term “immediate development” shall mean completion of all appropriate PLB disposition processes in a timely manner so that a Qualified End User has secured and provided proof of a temporary or permanent occupancy permit within fifteen (15) months of the Qualified End User’s initial submission of Property Transfer Application to the PLB
    • The PLB may convey Vacant Land for immediate development even if there are adjacent property owners who have expressed an interest in acquiring the land so long as PLB has followed the notice procedures set forth in Section 5.04.

Section 5.07 Side Yards

  1. PLB dispositions of Side Yards will generally adhere to the disposition procedures set forth in Section 5.04 above. In addition, the following supplementary considerations and procedures shall apply to the PLB’s disposition of all Side Yards:
    • PLB shall only convey Side Yards that are ineligible for independent development based on local side yard sale guidelines or the PLB’s own determination, including but not limited to the following criteria:
    • Geographic location
    • Topography
    • Total land area
    • Dimensions;
  2. In addition to those requirements set forth in Section 5.03, a Qualified End User in a Side Yard disposition:
    • Must own property, containing an occupied structure, that is physically contiguous to the Side Yard, with not less than a 50% common boundary line on one side; and
    • The Qualified End User shall not owe delinquent property taxes on any property owned by the Qualified End User, except that an end user will be deemed eligible if the end user has enrolled in a delinquent tax payment plan for all property owned by the end user, is in good standing on this plan, has demonstrated a good faith effort in that plan by making regular installment payments of at least 60% of the total plan amount, and, by the time of closing, the Qualified End User has satisfied all other conditions of the PLB disposition process.
  3. Any Property Transfer Application for a Side Yard must contain a description of the intended use for the proposed side yard.
  4. The Purchase and Sale Agreement for each Side Yard shall require that:
    • The Side Yard be combined to the adjacent property through consolidation, unless special circumstances render combination at the time of transfer impracticable or infeasible (the PLB shall support, and, only in its sole discretion, finance the costs of consolidation, where eligible); and
    • The Qualified End User hold clear title to the contiguous property.
  5. The PLB may enter into a Purchase and Sale Agreement with a Qualified End User prior to the PLB’s acquisition of a particular Side Yard. If the PLB does not hold title when the Purchase and Sale Agreement is executed, the Purchase and Sale Agreement shall state that the PLB’s obligation to close on the conveyance to the Qualified End User is conditioned upon the PLB ultimately acquiring title. Alternatively, such a Side Yard may close “in escrow” meaning that, at the time of closing, the Qualified End User will authorize the PLB to transfer title to the Side Yard into the end user’s name upon the PLB’s acquisition of clear title. The Consideration Amount will be paid at the time of closing or upon the PLB taking title, in the PLB’s discretion
  6. If two or more Qualified End Users have applied for the same Side Yard, the PLB will divide the Side Yard among the Qualified End Users in the PLB’s discretion. The PLB may require the Side Yard end users to pay for all or some of the cost of subdividing the Side Yard. Subdivision costs will be in addition to the Consideration Amount.

As noted in Section 5.02(F) Side Yard Consideration Amounts for Side Yards shall differ from standard PLB pricing.

  1. The PLB will offer up to two contiguous Side Yard parcels to Qualified End Users for the total price of $400 so long as the combined size of the lots remains incapable of independent development. Contiguous parcels are parcels contiguous to the Qualified End User’s adjacent property or contiguous to another eligible Side Yard. Additional parcels beyond two may be sold as Vacant Land Disposition with prices set pursuant to Section 5.02(F) and Section 5.06(B).
  2. If a parcel is offered as a Side Yard, the size of the parcel will not affect the Consideration Amount.