What is a Community Land Trust (CLT)?

Community land trusts are nonprofit, community-based organizations designed to ensure community stewardship of land. Community land trusts can be used for many types of development (including commercial and retail), but are primarily used to ensure long-term housing affordability. To do so, the trust acquires land and maintains ownership of it permanently. With prospective homeowners, it enters into a long-term, renewable lease instead of a traditional sale. When the homeowner sells, the family earns only a portion of the increased property value. The remainder is kept by the trust, preserving the affordability for future low- to moderate-income families.

The length of the lease (most frequently, 99 years) and the percentage earned by the homeowner vary. Ultimately, by separating the ownership of land and housing, this innovative approach prevents market factors from causing prices to rise significantly, and hence guarantees that housing will remain affordable for future generations. Today, there are nearly 250 community land trusts across the United States.

  • They provide low- and moderate-income people with the opportunity to build equity through homeownership and ensure these residents are not displaced due to land speculation and gentrification.
  • Land trust housing also protects owners from downturns because people are not over extended; as a result, foreclosure rates for land trusts have been as much as 90 percent less than conventional home mortgages.
  • Most commonly, at least one-third of a land trust’s board is composed of community residents, allowing for the possibility of direct, grassroots participation in decision-making and community control of local assets.
  • In addition to the development of affordable housing, many land trusts are involved in a range of community-focused initiatives including homeownership education programs, commercial development projects, and community greening efforts.
    (above excerpt from: CommunityWealth.org – http://community-wealth.org/strategies/panel/clts/index.html)

 

The community land trust combines a new approach to the OWNERSHIP of land, housing, and other
buildings with a new approach to the ORGANIZATION of the nonprofit that controls this property.
The basic features of the CLT model were outlined in The Community Land Trust: a Guide to a New
Model for Land Tenure in America, published by the International Independence Institute in 1972.
Ten years later, the Institute for Community Economics (ICE), successor to the International
Independence Institute, refined and extended the CLT model in another publication, the Community
Land Trust Handbook in which a new emphasis was placed on OPERATIONAL elements that
distinguished the CLT from most other community development organizations and programs of the
1980s.

Three clusters of characteristics, defining the community land trust in terms of ownership,
organization, and operation, came to be known as the “classic” CLT:

OWNERSHIP
● Title to multiple parcels of land, scattered across a targeted geographic area, is held by a single nonprofit
corporation. These lands are never resold, but are removed permanently from the market and managed on
behalf of a place-based community.
● Any buildings on this community-owned land are sold off to homeowners, cooperatives, nonprofits, or other
corporations or individuals. These structures may already exist when the nonprofit acquires the land, or
they may be constructed years later.
● A ground lease knits together – and equitably balances – the interests of the nonprofit landowner and the
interests of the buildings’ owners. This ground lease lasts for a very long time, typically 99 years; it is also
inheritable and mortgagable, allowing the owners of residential or commercial buildings to obtain private
financing to construct or to improve their structures.

ORGANIZATION
● The nonprofit landowner – i.e., the community land trust (CLT) – has a corporate membership that is open to
anyone living within the organization’s service area, which may be as small as a single neighborhood or as
large as an entire city, county, or region.
● A majority of the nonprofit’s governing board is elected by this membership.
● The governing board has a balance of interests, divided among three voting blocks. Seats are allocated
equally among directors who represent people living on the CLT’s land (leaseholders), directors who
represent residents of the CLT’s service area who do not live on the CLT’s land, and directors who represent
the public interest.

OPERATION
● There is a “preferential option for the poor.” Disadvantaged people who have been excluded from the
economic and political mainstream and disadvantaged places that have been buffeted by successive waves
of disinvestment and gentrification have the first claim on a CLT’s resources.
● There is an organizational commitment to preserving the permanent affordability of housing (and other
structures) that are located on the CLT’s land or placed under the CLT’s care.
● There is an organizational commitment to maintaining these structures in good repair and in safeguarding
the success of low-income people who have been boosted into homeownership or into other types or
tenures of housing through the CLT’s efforts.

Not every feature of the “classic” CLT has been uniformly adopted by every organization calling itself a “community land
trust.” The national and international landscape of CLTs is quite diverse, with numerous variations in the way these
nonprofit landowners are structured and operated.

There is also wide variation in the kinds of land uses and in the kinds of buildings to which CLTs have been applied. Despite a
strategic decision by leaders of the fledgling CLT movement in the early 1980s to focus on single-family homeownership, the
model can be used – and frequently has been used – in the development and stewardship of other types and tenures of
housing, including: multi-unit rentals, limited equity condominiums and cooperatives, and “mobile homes” in
resident-controlled parks. CLTs have also been applied to many non-residential projects, including neighborhood parks,
community gardens, commercial buildings, community service centers, urban agriculture, and family farms.

(above excerpt from: http://community-wealth.org/strategies/panel/clts/index.html)