(1) Inventory.
(a) Each Agency shall maintain an up-to-date inventory of surplus properties owned by the Agency and shall make such inventory publicly accessible on the internet and at its offices during normal business hours. The inventory may be depicted a map of such properties along with other relevant information about land use conditions, such as vacancy and tax delinquency rates. An inventory for the surplus properties of all the Agencies may be maintained collectively by one of the Agencies.
(2) Methods.
(a) An individual or entity who seeks to obtain a surplus property must submit an application in such form as is specified by the Agency. Properties may only be conveyed to a Qualified Applicant who has submitted a timely and complete application. An applicant is qualified if:
(.1) the applicant has no City tax or water delinquencies, or other City delinquencies, or is in a current payment agreement with respect to any such delinquencies;
(.2) no properties owned by the applicant have outstanding violations under The Philadelphia Code. A violation shall not be considered outstanding if there is an agreement with the City to come into compliance; and
(.3) such other threshold criteria as may be established in the Disposition Policy is satisfied.
(c) Disposition Pursuant to Competitive Process. Except as authorized under subsection 16-404(2)(d), an Agency shall dispose of a surplus property pursuant to a process that includes the following:
(.1) The Agency shall advertise the availability of a property. Such advertisement shall specify a period of time, not less than 30 days, during which applicants may submit an application for the property. The advertisement shall include the weighted criteria set forth in this subsection.
(.2) Within 120 days of the close of the submission period, the Agency shall evaluate applications of qualified applicants for selection based upon the following weighted criteria: thirty percent (30%) for economic opportunity and inclusion; fifteen percent (15%) for public purpose - social impact; twenty percent (20%) for development team experience and capacity; twenty percent (20%) for financial feasibility; ten percent (10%) for project design; and five percent (5%) for offer price. The Agency may select an applicant based upon such criteria to the fullest extent permitted by law, or it may choose not to select any applicant.
(.3) No later than 120 days of the close of the submission period, the Agency shall provide all applicants with either a denial letter or, if an applicant is selected for disposition, a purchase agreement that includes a price valid for no less than one year from the time of delivery of an executed agreement by the applicant (subject to extension by the Agency). Such purchase agreement shall include such restrictions in connection with the purchase agreement and transfer of title as deemed appropriate by the Agency and as required by the Disposition Policy and this Chapter.
(.1) In the 3rd and 4th Council Districts, an Agency may dispose of surplus properties to a qualified applicant without following the process set forth in subsection 16-404(2)(c) in any one of the following circumstances:
(.a) An applicant seeks property for use as a side or rear yard, provided such property has no permanent structures, such property is not more than 1,440 square feet, such property is comprised of no more than two adjacent parcels, and the applicant owns and occupies adjacent property as a primary residence.
(.b) An applicant seeks property for use as a community garden, open space or recreational area, provided such applicant is organized as a non-profit organization under Pennsylvania Law.
(.c) An applicant seeks property for use as expansion of an existing business in the near vicinity of the property.
(.d) A significant portion of the proposed development site is already owned by such applicant and the surplus property will be developed as part of the development project.
(.e) At least fifty-one percent (51%) of the development qualifies as either affordable or workforce housing, under local or federal guidelines, or mixed-income housing, pursuant to subsection 14-702(7) of The Philadelphia Code.
(.f) The development is a community benefiting use, such as, without limitation, a daycare, healthcare or senior center, that is designed to benefit low-income and moderate-income households, all as further defined in the Disposition Policy.
(.2) Applications for non-competitive dispositions shall be evaluated for financial and operational capacity to complete the proposed project, and other considerations, in accordance with the Disposition Policy.
(.a) Applications pursuant to a non-competitive process involving residential or commercial development, or business expansion shall be evaluated based upon the following weighted criteria:
(i) thirty percent (30%) for economic opportunity and inclusion and community control;
(ii) fifteen percent (15%) for public purpose - social impact and community control;
(iii) twenty percent (20%) for development team experience and capacity;
(iv) twenty percent (20%) for financial feasibility of the proposed project, provided that for applications submitted by a community trust for a lease, financial feasibility will be scored solely based on the ability to maintain the requested properties and provide required insurance;
(v) ten percent (10%) for project design; and
(vi) five percent (5%) for offer price, provided that for applications proposing residential housing development in which fifty percent (50%) or more of the residential housing units will remain permanently affordable units at fifty percent (50%) of AMI and below for rental units and at eighty percent (80%) of AMI and below for homeownerships units, full points will be awarded for the offer price criterion.
(.b) Applications pursuant to a non-competitive process for creating a new community garden or open space is eligible for a Lease Agreement if the applicant is a Qualified Applicant.
(.c) The Qualified Applicant may be brought in for an oral presentation before evaluation is completed.
(.3) Upon receipt of an application for the disposition of a surplus property pursuant to this subsection 16-404(2)(d), the Agency shall accept applications from other applicants for such property for a period of sixty (60) days from the date the first application was received. Following the close of the sixty (60) day period, all complete applications received for a property shall be evaluated in accordance with subsection 16-404(2)(a). Each applicant deemed qualified pursuant to subsection 16-404(2)(a) shall have its application evaluated pursuant to subsection 16-404(2)(d)(.2):
(.b) If more than one applicant is qualified under subsection 16-404(2)(d)(.2), none of those qualified applicants is a Community Trust, and the first application received is qualified, the first application received shall be selected for the properties requested by the applicant, and the applicant shall be notified pursuant to subsection 16-404(2)(d)(.4).
(.c) If more than one applicant is qualified under subsection 16-404(2)(d)(.2), and none of the qualified applicants is either a Community Trust or the first applicant, the Agency may select the application deemed most qualified under subsection 16-404(2)(d)(.2), and the applicant shall be notified pursuant to subsection 16-404(2)(d)(.4).
(.4) Within 120 days of receiving the first application for the disposition of a surplus property pursuant to this subsection 16-404(2)(d), the Agency shall advise the selected applicant in writing that the Agency will recommend such property to the Agency's board for disposition to the selected applicant and shall notify all other applicants of the rejection of their applications.
(.5) If the applicant's proposal has been deemed suitable to recommend for approval, the Agency shall provide that applicant with a purchase or lease agreement that is valid for no less than one year (subject to extension by the Agency) from the time of delivery of an executed agreement by the applicant. The agreement shall include such restrictions in connection with the purchase and development of the property and transfer of title or the lease and use of the property as deemed appropriate by the Agency and as required by the Disposition Policy and this Chapter.
(e) Disposition without Competitive Process in the 1st, 2nd, 5th, 6th, 7th, 8th, 9th and 10th Council Districts. 39
(.1) In the 1st, 2nd, 5th, 6th, 7th, 8th, 9th, and 10th Council Districts and in accordance with the requirements of subsection 16-402(2)(e), an Agency may dispose of surplus properties to a qualified applicant without following the process set forth in subsection 16-404(2)(c) in any of the circumstances set forth in subsections 16-404(2)(d)(.1).
(.2) Applications for non-competitive dispositions shall be evaluated for financial and operational capacity to complete the proposed project, and other considerations, in accordance with the Disposition Policy.
(.3) Within 120 days of receiving a completed application for the disposition of a surplus property pursuant to this subsection 16-404(2)(e), the Agency shall advise the applicant in writing whether the Agency will offer the property to the applicant.
(.4) If the applicant's proposal has been deemed suitable to recommend for approval, the Agency shall provide that applicant with a purchase agreement that is valid for no less than one year (subject to extension by the Agency) from the time of delivery of an executed agreement by the applicant. Such purchase agreement shall include such restrictions in connection with the purchase agreement and transfer of title as deemed appropriate by the Agency and as required by the Disposition Policy and this Chapter.
(3) Terms.
(a) For properties sold for fair market value, the fair market value of such property shall be determined by an independent appraisal or in-house opinion of value by a licensed appraiser. The applicant may submit information that is relevant to the value of such property for consideration.
(b) An Agency may dispose of a surplus property to an applicant at a price that is nominal or less than fair market value, if either:
(.1) The Agency is disposing of the property under the process set forth in subsection 16-404(2)(c); or
(.2) The Agency determines that the proposed use of the property falls into a category set forth in the Disposition Policy for which such nominal or less than fair market value disposition is authorized.
(c) An Agency may develop policies to permit, in specified circumstances, alternative forms of payment by applicants who cannot afford immediate payment in full.
(d) The Disposition Policy may authorize exchanges of real property in lieu of payment.
(e) An Agency shall require that terms and conditions be incorporated into the agreement and the deed conveying title to surplus properties approved for disposition appropriate to the disposition and consistent with the Disposition Policy, and including, at a minimum, to the extent feasible in the context of the particular transaction:
(.1) an irrevocable power of attorney, coupled with an interest, appointing the grantor or its designee as true and lawful attorney-in-fact for the grantee to enter into and take possession of such property, with other necessary provisions, in the event of a failure by the grantee to comply with any term or condition established in connection with transfer of title; and
(.2) a requirement that failure of compliance with any term or condition established in connection with transfer of title will cause title to the property to revert to the ownership of the City of Philadelphia, the Philadelphia Redevelopment Authority or the Philadelphia Land Bank, automatically, without any conveyance thereof being required, upon notice that such failure exists and such failure is not remedied by the expiration of any applicable cure period.
(f) An Agency shall require an agreement for all dispositions of surplus properties. 40
(.1) For dispositions by the Redevelopment Authority, the agreement shall be a redevelopment contract in accordance with the Urban Redevelopment Law and Chapter 16-600.
(.a) For dispositions to community trusts pursuant to subsection 16-404(2)(d), the agreement may be a Lease Agreement, subject to compliance with such terms and conditions as the Agency deems necessary to evaluate the entity's financial and operational capacity to purchase, develop and maintain the property in perpetuity in accordance with its development plan and such other requirements as the Agency may impose. A Lease Agreement pursuant to this Section shall include an initial lease term of at least one (1) year but no more than five (5) years, at the expiration of which possession of the property shall revert to the possession by the City of Philadelphia or the Agency, automatically, if the Agency does not transfer title of the property to the community trust. The Lease Agreement shall stipulate that the property is to remain as open space, with construction prohibited from occurring on the land, and that any use other than open space will require an amendment to the Lease Agreement. The Agency may transfer title of the property at or before the expiration of the lease term, but no earlier than a year after execution of the lease, provided the community trust has demonstrated satisfaction of the agreement requirements and submitted a complete land development application, which may include but are not limited to:
(i) Payment in full of any nominal rent owed to the City during the lease term;
(ii) Effective financial stewardship of the community trust and the surplus property, as evidenced by audited financial statements, annual reports or other documentation demonstrating the staff and financial capacity to implement this project concurrently with any other comparable pending projects;
(iii) Effective physical stewardship of the property during the lease term, as evidenced by visual evidence that no construction took place onsite during the lease term and the site is clear of significant debris;
(iv) Substantial progress on the proposed development project and capacity to timely complete the project as approved by the Agency;
(v) Cost and proof of funds to complete the project, akin to the type of documentation that would otherwise be required for a full disposition;
(vi) Proof of insurance on the surplus property;
(vii) Commitment to adhere to deed restrictions preventing resale of the property; and
(viii) Bylaws provisions or other legally binding document ensuring land transfer to a nonprofit organization obligated to honor the use and affordability restrictions between the community trust and its lessees upon dissolution of the organization.
(.b) The Agency has the authority to grant a lease extension of one year or less upon determination that the applicant can demonstrate substantial progress on project financing.
(.3) An Agency may impose any other conditions of sale including, without limitation, deed restrictions, restrictive covenants, and mortgages. The Agency shall monitor compliance with such conditions, including by requiring periodic reporting by transferees.
(4) Approvals.
(a) An Agency shall not dispose of, or lease for more than one year, a surplus property, without approval of the disposition by resolution of the Board of Directors of the Agency, and approval by a resolution or ordinance of City Council. A summary of the lease or disposition terms shall be provided for inclusion with the Council approval resolution or ordinance. Such approvals may not be given until at least ten (10) days after public notice has been provided as required by subsection (b), and, regarding dispositions for Land Development located in the 3rd and 4th Council Districts, not unless the selected applicant has held at least one community meeting with notice provided to those Registered Community Organizations as defined in subsection 14-303(11A) whose registered area of concern contains one or more of the properties included in the application. If there is more than one RCO whose registered boundaries include the requested property, the district councilmember whose district includes the requested property shall select one of those RCOs as the Coordinating RCO, or may select two or more RCOs whose registered boundaries include the requested property to serve jointly as the Coordinating RCO. The selection of coordinating RCO(s) shall not be duly withheld and shall be selected in a timely manner. It is the responsibility of the applicant to contact the Coordinating RCO once assigned to schedule the community meeting. Evidence of the community meeting, including notice of the meeting, certificate of mailing, meeting agenda and letter summarizing the meeting discussion, must be submitted to the Agency before the application will be placed on the Agency's board meeting agenda. The Agency has the right to reject the application if evidence of this RCO meeting is not provided within 60 days of the RCO meeting taking place. 40.1
(b) An Agency shall provide public notice of proposed dispositions, and leases for more than one year, as early as practicable. Public notice shall include a conspicuous posting on property proposed for disposition or lease, and notice to those registered community organizations as defined in subsection 14-303(11A) whose registered geographic area of concern contains a property proposed for disposition. Any individual or organization may submit comment in writing regarding a proposed disposition or lease to the Agency with title to the property. The Agency shall transmit, or otherwise make available, all such comments to its Board.
(c) Nothing in this Chapter shall obligate an Agency to dispose of a surplus property to an applicant for such property, including the highest scoring applicant in a competitive process.
(d) A reference to the Vacant Property Review Committee in connection with methods set forth in a deed or agreement to satisfy deed terms and conditions existing at the time of adoption of this Section shall be construed as a reference to the Commissioner of Public Property.
Notes
| 37 | |
| 38 | Amended, Bill No. 220322-AAA (became law January 19, 2023). |
| 39 | Added, Bill No. 220322-AAA (became law January 19, 2023). |
| 40 | Amended, Bill No. 220322-AAA (became law January 19, 2023). |
| 40.1 | Amended, Bill No. 220322-AAA (became law January 19, 2023). |