NY State Senate Bill 2009-S8203

Senate Bill S8203

2009-2010 Legislative Session

Authorizes municipalities to enter into contracts to sell delinquent real property tax liens to private parties

download bill text pdf

Archive: Last Bill Status - In Senate Committee Rules Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jun 16, 2010	referred to rules

2009-S8203 (ACTIVE) - Details

See Assembly Version of this Bill:: A982
Current Committee:: Senate Rules
Law Section:: Real Property Taxation
Laws Affected:: Add §1191, RPT L
Versions Introduced in 2011-2012 Legislative Session:: S1170

2009-S8203 (ACTIVE) - Summary

Authorizes municipalities to, on or before December 31, 2010, enter into contracts to sell delinquent real property tax liens to private parties.

2009-S8203 (ACTIVE) - Sponsor Memo

                                BILL NUMBER:S8203

TITLE OF BILL:
An act
to amend the real property tax law, in relation to authorizing
any municipality to enter into a contract to sell some or
all of the delinquent tax liens held by such municipality to a private
party; and providing for the repeal of such provisions upon the
expiration thereof

PURPOSE:
To expand the options available to
municipalities to
efficiently and effectively manage the collection of delinquent
property taxes.

SUMMARY OF PROVISIONS:
Section 1: Adds a new Real Property Tax Law
section 1191 to expand the sale of tax liens to private parties.
Permits municipalities, under certain conditions, to enter into a
contact to sell some or all of their delinquent tax liens to a
private party. The contract must be entered into by December 31,
2010. The authority to enter into such contracts sunsets on December
31, 2012. The bill provides for consumer protections for affected
property owners, including a requirement for 30 days notification,
assurance that the existing redemption periods and interest rates

remain unchanged, and the imposition of procedural requirements
relating to foreclosure of a mortgage or tax lien sale by the
Municipal Bond Bank Agency.

EXISTING LAW:
Chapter 177 of the Laws of 2004 and
Chapter 505 of the
Laws of 2006 provide similar authority for the cities of Schenectady
and Amsterdam, respectively. In 2007, Gloversville and the city of
Utica were added to the list of communities that can utilize this new
procedure.

JUSTIFICATION:
This bill was introduced at the
request of several
municipalities that do not have the option of selling their liens to
a private entity. This legislation will provide municipalities with
the same option which has been utilized by the Amsterdam,
Gloversville, Schenectady and Utica.

LEGISLATIVE HISTORY:
2007-2008: A.1253 Reported from RPT 2007 in Ways &
Means 2008
2005-2006: A.6573 Referred to RPT

FISCAL IMPLICATIONS:
None.

LOCAL FISCAL IMPLICATIONS:
Should improve the fiscal condition of any
municipality that exercises this new option to obtain cash from the
sale of delinquent tax liens.

EFFECTIVE DATE:
Immediately, and shall expire December 31, 2012.

2009-S8203 (ACTIVE) - Bill Text download pdf

                            
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                  8203

                            I N  S E N A T E

                              June 16, 2010
                               ___________

Introduced  by  Sen.  PARKER -- read twice and ordered printed, and when
  printed to be committed to the Committee on Rules

AN ACT to amend the real property tax law, in  relation  to  authorizing
  any  municipality  to enter into a contract to sell some or all of the
  delinquent tax liens held by such municipality to a private party; and
  providing for the repeal of such provisions upon the expiration there-
  of

  THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section  1.  The  real  property  tax  law  is amended by adding a new
section 1191 to read as follows:
  S 1191. SALE OF TAX LIENS TO PRIVATE  PARTIES.    NOTWITHSTANDING  ANY
PROVISION  OF  ANY  GENERAL,  SPECIAL  OR LOCAL LAW TO THE CONTRARY, ANY
MUNICIPALITY MAY, ON OR BEFORE DECEMBER THIRTY-FIRST, TWO THOUSAND  TEN,
ENTER  INTO  A  CONTRACT  TO SELL ANY OR ALL OF THE DELINQUENT TAX LIENS
HELD BY IT TO A PRIVATE PARTY AND SUCH CONTRACT SHALL NOT EXTEND FOR ANY
PERIOD BEYOND DECEMBER THIRTY-FIRST, TWO THOUSAND TWELVE, SUBJECT TO THE
FOLLOWING CONDITIONS:
  1. PRIOR TO ANY SALE, THE LOCAL GOVERNING BODY  SHALL  HOLD  A  PUBLIC
HEARING,  ON NOTICE OF AT LEAST THIRTY DAYS, ANNOUNCING THE INTENTION OF
SAID LOCAL GOVERNING BODY TO SELL ITS DELINQUENT REAL PROPERTY TAX LIENS
TO A THIRD PARTY. SUCH HEARING SHALL NOT BE HELD MORE THAN  NINETY  DAYS
PRIOR TO SUCH SALE.
  2.  THE  CONSIDERATION  TO  BE  PAID MAY BE MORE OR LESS THAN THE FACE
AMOUNT OF THE TAX LIENS SOLD;
  3. PROPERTY OWNERS SHALL BE GIVEN AT LEAST THIRTY DAYS ADVANCE  NOTICE
OF  SUCH  SALE IN THE SAME FORM AND MANNER AS IS PROVIDED BY SUBDIVISION
TWO OF SECTION ELEVEN HUNDRED NINETY OF THIS ARTICLE. FAILURE TO PROVIDE
SUCH NOTICE OR THE FAILURE OF THE ADDRESSEE TO RECEIVE  THE  SAME  SHALL
NOT  IN  ANY  WAY  AFFECT  THE VALIDITY OF ANY SALE OF A TAX LIEN OR TAX
LIENS, OR THE VALIDITY OF THE TAXES OR INTEREST PRESCRIBED BY  LAW  WITH
RESPECT THERETO;
  4. THE MUNICIPALITY SHALL SET THE TERMS AND CONDITIONS OF THE CONTRACT
OF SALE;

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.

                                                           LBD02314-01-9

S. 8203                             2

  5.  THE TAX LIEN PURCHASER MUST, THIRTY DAYS PRIOR TO THE COMMENCEMENT
OF ANY FORECLOSURE ACTION, PROVIDE THE MUNICIPALITY WITH A LIST OF LIENS
TO  BE  FORECLOSED.  THE  MUNICIPALITY  MAY,  AT  ITS  SOLE  OPTION  AND
DISCRETION,  REPURCHASE A LIEN OR LIENS ON THE FORECLOSURE LIST FROM THE
TAX LIEN PURCHASER. THE REPURCHASE PRICE SHALL BE THE AMOUNT OF THE LIEN
OR  LIENS  PLUS  ANY  ACCRUED  INTEREST  AND  REASONABLE  AND  NECESSARY
COLLECTION FEES AND COSTS INCURRED BY THE TAX LIEN  PURCHASER.  THE  TAX
LIEN  PURCHASER  SHALL PROVIDE THE FORECLOSURE LIST TO THE MUNICIPALITY,
ALONG WITH THE APPLICABLE REPURCHASE PRICE OF EACH  LIEN,  BY  CERTIFIED
MAIL, AND THE MUNICIPALITY SHALL HAVE THIRTY DAYS FROM THE RECEIPT THER-
EOF  TO  NOTIFY  THE TAX LIEN PURCHASER OF ITS OPTION TO PURCHASE ONE OR
MORE OF THE LIENS. IF THE MUNICIPALITY OPTS TO  PURCHASE  THE  LIEN,  IT
SHALL  PROVIDE  PAYMENT  WITHIN THIRTY DAYS OF RECEIPT OF THE REPURCHASE
PRICE OF SAID LIEN OR LIENS. IF THE MUNICIPALITY SHALL FAIL  TO  OPT  TO
REPURCHASE  THE  LIEN  OR  LIENS,  THE TAX LIEN PURCHASER SHALL HAVE THE
RIGHT TO COMMENCE A FORECLOSURE ACTION IMMEDIATELY;
  6. THE SALE OF A TAX LIEN PURSUANT TO THIS ACT SHALL  NOT  OPERATE  TO
SHORTEN  THE OTHERWISE APPLICABLE REDEMPTION PERIOD OR CHANGE THE OTHER-
WISE APPLICABLE INTEREST RATE;
  7. UPON THE EXPIRATION OF THE REDEMPTION PERIOD PRESCRIBED BY LAW, THE
PURCHASER OF A DELINQUENT TAX LIEN, OR ITS SUCCESSORS  OR  ASSIGNS,  MAY
FORECLOSE  THE  LIEN AS IN AN ACTION TO FORECLOSE A MORTGAGE AS PROVIDED
IN SECTION ELEVEN HUNDRED NINETY-FOUR OF THIS ARTICLE. THE PROCEDURE  IN
SUCH ACTION SHALL BE THE PROCEDURE PRESCRIBED BY ARTICLE THIRTEEN OF THE
REAL  PROPERTY  ACTIONS AND PROCEEDINGS LAW FOR THE FORECLOSURE OF MORT-
GAGES.  AT ANY TIME FOLLOWING THE COMMENCEMENT OF AN ACTION TO FORECLOSE
A LIEN, THE AMOUNT REQUIRED TO REDEEM THE LIEN, OR THE  AMOUNT  RECEIVED
UPON  SALE  OF  A  PROPERTY,  SHALL  INCLUDE  REASONABLE  AND  NECESSARY
COLLECTION COSTS, ATTORNEYS' FEES, LEGAL COSTS, ALLOWANCES AND DISBURSE-
MENTS; AND
  8. THE PROVISIONS OF THIS TITLE SHALL APPLY SO FAR AS  IS  PRACTICABLE
TO A CONTRACT FOR THE SALE OF TAX LIENS PURSUANT TO THIS ACT.
  9.  IN  EACH  YEAR  SUBSEQUENT  TO THE TAX LIEN SALE, AND NO MORE THAN
SIXTY DAYS AFTER THE ANNUAL ANNIVERSARY DATE OF  SUCH  SALE,  THE  LOCAL
GOVERNING  BODY SHALL PRODUCE A WRITTEN REPORT ON THE STATUS AND RESULTS
OF SAID SALE AND SUCH REPORT SHALL INCLUDE BUT NEED NOT  BE  LIMITED  TO
THE  TOTAL  DOLLAR AMOUNT RECEIVED BY THE MUNICIPALITY IN SAID SALE, THE
NUMBER OF FORECLOSURES CONDUCTED BY THE THIRD PARTY, THE NUMBER, IF ANY,
OF COMPLAINTS ABOUT THE FORECLOSURE PROCESS, THE  NUMBER  OF  PROPERTIES
TAKEN  BACK BY THE MUNICIPALITY PURSUANT TO THE TERMS OF THE CONTRACT OF
SALE, THE NUMBER, IF ANY, OF COMPLAINTS RECEIVED BY THE MUNICIPALITY  ON
THE  CONDUCT  OF  THE  THIRD PARTY AND ANY OTHER INFORMATION THE MUNICI-
PALITY DEEMS NECESSARY AND IMPORTANT ON THE STATUS OF  SAID  SALE.  SAID
WRITTEN REPORT MUST BE FILED WITH THE GOVERNOR, COMPTROLLER OF THE STATE
OF  NEW  YORK, TEMPORARY PRESIDENT OF THE SENATE, MINORITY LEADER OF THE
SENATE, SPEAKER OF THE ASSEMBLY, AND THE MINORITY LEADER OF  THE  ASSEM-
BLY.
  10.  ON OR BEFORE JULY FIRST, TWO THOUSAND TWELVE BUT NOT EARLIER THAN
MAY FIRST, TWO THOUSAND TWELVE, THE COMPTROLLER OF THE STATE OF NEW YORK
SHALL ISSUE A WRITTEN REPORT ON THE STATUS OF ALL PRIVATE TAX LIEN SALES
THAT HAVE OCCURRED IN THE STATE WHETHER BY THE TERMS OF THIS SECTION,  A
CHAPTER  OF THE LAWS OF THE STATE OF NEW YORK SPECIFIC TO A CITY, COUNTY
OR VILLAGE, OR BY ANY OTHER SPECIAL, GENERAL OR LOCAL LAW IN THE  CALEN-
DAR YEARS TWO THOUSAND NINE, TWO THOUSAND TEN AND TWO THOUSAND ELEVEN.
  S  2.  This act shall take effect immediately, and shall expire and be
deemed repealed on and after December 31, 2012.

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