Acquiring real property from the City of Kinston
If you’re reading this, you may be interested in acquiring a piece of real property from the City of Kinston. Currently, the City of Kinston owns several hundred vacant and unused properties and as a member of the City Council, I’ve worked to to put these properties back into the hands of the community. The majority of these properties are flood buyout properties, or are vacant and overgrown lots. These properties present immense potential for community development, economic opportunities, and revitalization—especially in neighborhoods like East Kinston.
Based on North Carolina law, there are a few different ways that the City can convey these properties. In this article, I will try to explain three of those ways that members of our community may find most helpful:
1. Donation or Conveyance of Property to Nonprofit Organizations
Nonprofit organizations can make a request to the City Council that it conveys a piece of real property to their organization for a public purpose. This means that the property has to provide some benefit or purpose to the entire community, and the City Council will impose a “covenant” on the property deed to ensure that public purpose is met.
Before requesting a conveyance of property from the City Council, I would recommend that interested organizations first meet with a representative from the City of Kinston (particularly the Planning Director or another person knowledgeable in this area) to determine if the property you are interested in is actually available, if your planned project meets the current zoning requirements, and if your planned purpose provides a public benefit.
Once you’ve submitted your formal request (typically in writing as a letter or email to the City Council), the City Council will consider whether or not to move forward with the donation. If the City Council chooses to move forward with it, the Council will adopt a resolution stating so and publish a public notice in the local newspaper. After ten (10) days have passed, the property can be officially conveyed.
2. Upset Bid Process
In October 2022, I introduced a policy aimed at promoting the sale of vacant city-owned properties and streamlining the city’s property bidding process. The policy was on the agenda for the City Council to discuss during our October 18 meeting, and, after careful consideration, the City Council unanimously voted to approve it. You can click here to view the full policy.
The City of Kinston currently owns many vacant and underutilized properties throughout our community that have been a strain on city resources to keep clean and maintained. I’m excited to have been able to introduce this policy that will make it easier for interested citizens to identify what properties are owned by the City of Kinston and define clear procedures and requirements for those citizens to submit bids to purchase them.
Although the City now has this policy in place, it is still required to follow the North Carolina General Statute that governs the upset bid process for city councils. You can find that statute below:
§ 160A-269. Negotiated offer, advertisement, and upset bids.
A city may receive, solicit, or negotiate an offer to purchase property and advertise it for upset bids. When an offer is made and the council proposes to accept it, the council shall require the offeror to deposit five percent (5%) of his bid with the city clerk, and shall publish a notice of the offer. The notice shall contain a general description of the property, the amount and terms of the offer, and a notice that within 10 days any person may raise the bid by not less than ten percent (10%) of the first one thousand dollars ($1,000) and five percent (5%) of the remainder. When a bid is raised, the bidder shall deposit with the city clerk five percent (5%) of the increased bid, and the clerk shall readvertise the offer at the increased bid. This procedure shall be repeated until no further qualifying upset bids are received, at which time the council may accept the offer and sell the property to the highest bidder. The council may at any time reject any and all offers. (1971, c. 698, s. 1; 1979, 2nd Sess., c. 1247, s. 25.)
Essentially, these are the steps I would recommend to submit an offer to go through the upset bid process:
Identify a property you are interested in. Under the City’s new policy, the City of Kinston plans to publish a list each year that shows what properties are available to the community for bid.
During our March 7, 2023 meeting, the Kinston City Council approved a list of properties we would like to advertise to be available through the upset bid process. This list does NOT include all properties owned by the City of Kinston, but this is one place to start your search as it includes the properties that the City Council is interested in selling at this time. You can find this list on the City’s Planning Department website or by clicking here.
Submit an offer to the City of Kinston. The City Council requires that initial offers for the upset bid process to be, at minimum, 15% of the appraised tax value of the property. In addition to submitting your initial offer, you must also submit a five (5%) bid deposit in the form of a cashier's check or money order made payable to the City of Kinston.
The City Council also requires that the deposit amount be not less than the full amount of the bid for any bids under $1,000.
The City Council does not require that you state what you plan to use the property for, but sometimes it is helpful for the council members to know that information before accepting your offer.
Upset Bid advertisement. The City of Kinston will advertise your offer to purchase the property for a period of ten (10) days by way of a Public Notice. These notices are typically posted in the local newspaper, the Kinston Free Press.
During this ten-day period, other community members can submit bids to “upset” your initial offer. The highest upset bid received during that ten-day period will initiate another advertisement period.
Sale & Conveyance. If or when no upset bids are received, the City Council will be presented with a resolution to authorize the sale of the specified property.
The City Council reserves the right, at any time, to reject any offers.
If the sale is authorized, the City of Kinston’s staff will work with you to finalize the conveyance of the property with a non-warranty deed.
The City Council requires that the high bidder cover the advertising costs for any bids under $1,000.00.
While this process may seem a bit complex, it is actually the most common way that individuals have acquired property from the City of Kinston.
3. Direct Sale for Certain Purposes
Under certain circumstances, the City Council may be allowed to directly sell or convey a property to an entity at fair-market value without the competitiveness of the upset bid process. These circumstances are limited to historic conservation or preservation, the development of affordable housing, economic development (job creation), or community development. It is my recommendation that you seek the counsel of a licensed real estate professional and/or attorney experienced in these conveyances if you decide to pursue this option.
You can utilize Lenoir County’s FREE, online Tax Records and GIS Mapping Tools to identify public information about a property. If you know the address of a property you are interested in, you can search it on the Lenoir County Tax Records site (www.lenoircountytaxes.com) to find out if it is owned by the City of Kinston, what the tax value of it is, as well as the tax history on the property. If you don’t know the address of the property, you can use Lenoir County’s GIS Mapping Tool to try to identify the property on a map.
I hope that this information has been helpful for you in some way, and it is my goal that this helps increase economic and community development opportunities for our city. Kinston has a lot of potential for growth, but it will take us working together—both the local government and the community—in order for us to achieve our desired progress.
If you have an interest in a property that isn’t currently listed as available for purchase, such as a FEMA flood buyout property, I encourage you to reach out to a member of the City government to discuss your ideas and ensure they may meet the permitted land uses.
Yours in service,
Chris