Throughout various neighborhoods of Minneapolis, abandoned buildings and underutilized lots display a legacy of land speculation and missed opportunities.
Consider the 200 Oak Grove apartments—a once-vibrant complex, now reduced to a hazardous plot, leaving a neighborhood without a crucial community asset. Owned by notoriously unresponsive landlord C. David George, the property has reflected community decline for over two years. Victim to 128 code violations and a devastating fire, this building represents the need for a new strategy to help communities better utilize existing land.
The city’s new vacant building ordinance, passed in July, is a step in the right direction. Imposing hefty fines of up to $24,000 annually for neglected properties, compared to the former fee of $7,100, it pressures careless property owners to either repair or sell their properties.
However, this challenge is rooted deeper than a single problematic building. Boarded-up storefronts, neglected homes, and idle lots are more than just eyesores; they are symptoms of systemic neglect that perpetuate disinvestment in communities.
With over 300 listed vacant properties, we must work harder to address the symptoms of underutilized land and confront the root cause: our current tax code.
At the heart of this issue lies a system that unintentionally rewards property owners for letting land and buildings remain idle. Under our current property tax structure, taxes are based on both property value and additional improvements, causing owners who invest in their properties to face substantially higher taxes than owners who leave their buildings vacant or lots unused. Consequently, owners are incentivized to hold onto vacant land, hoping that external factors such as nearby development and rising market demand will increase its value.
To end this cycle of neglect, the state must enable cities to create land-value taxation districts; thus, Minneapolis could enact an ordinance that prioritizes taxing the value of land according to its proximity to jobs, amenities, and transit, over property improvements.
This is where HF161, a bill introduced by Rep. Steve Elkins, DFL-Bloomington, and four legislative co-authors, comes into play.
If passed, the bill would give local governments the option to shift property taxes away from buildings and onto land value, taking effect in 2026. Allowing cities to adopt land value taxation, this policy would not only encourage productive land use but also reduce speculative holding.
Despite concerns that land taxes might drive up rents, economic research suggests otherwise. Because land is fixed in supply, landowners absorb the full tax burden, preventing these costs from being passed on to tenants. A land value tax, therefore, won’t drive up rents or gentrification. In fact, by discouraging speculative holding and promoting productive development, it helps stabilize housing costs—and when paired with affordable housing initiatives or rent stabilization policies, it offers genuine protection against displacement.
This approach isn’t just theoretical; a land value tax is currently used in 16 jurisdictions in Pennsylvania. Municipal studies found that this approach boosted annual housing construction by 8.4%, effectively addressing vacancies.
Recall that the vacant building ordinance levies higher fines on buildings in disrepair, yet it takes no action on undeveloped land—leaving many vacancies untouched. Moreover, unoccupied lots left behind by earlier demolitions aren’t even included in the city registry, freeing them from accountability. These properties are disproportionately concentrated in North Minneapolis, including the dilapidated buildings lining West Broadway.
Underutilized, these spaces could be transformed into community hubs or housing. With the implementation of a land value tax, holding on to these vacant lands without generating new development would create financial burdens rather than profit. Instead, property owners would be motivated to transform these spaces into vibrant communities filled with new homes, thriving local shops, and welcoming public spaces. One such example is a proposed mixed-use building, designed to create homes for youth in mentoring programs. In order to close this disparity and create the vibrant neighborhoods we all deserve, a land value tax would ensure that all land, registered or not, is subjected to pressure for productive use.
Additionally, this tax reform would ensure long-term accountability for property owners, complementing the vacant building ordinance and its efforts. While the ordinance can rehabilitate neglected structures, the LVT would prevent vacant properties and idle lots from becoming a recurring problem.
The bill is currently in the House Taxes Committee, where it needs support to move forward. Reaching out to state representatives can help ensure that HF161 receives the attention it deserves.
While Minneapolis has taken an important step forward with the vacant building ordinance, broader action is needed to fully address urban vacancy. Housing affordability remains a growing issue, and many neglected areas continue to stagnate without the right incentives for development. With momentum building for tax reform and smarter urban development, now is the time to push for meaningful change.
Chris Cardenas is a Grinnell College student focusing on sustainable and abundant housing solutions and an affiliate of Neighbors for More Neighbors.
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(Except for the headline, this story has not been edited by PostX News and is published from a syndicated feed.)
