NY State Senate Bill 2011-S1170

Senate Bill S1170

2011-2012 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 Local Government 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
Jan 04, 2012	referred to local government
Jan 05, 2011	referred to local government

2011-S1170 (ACTIVE) - Details

Current Committee:: Senate Local Government
Law Section:: Real Property Tax Law
Laws Affected:: Add §1191, RPT L
Versions Introduced in 2009-2010 Legislative Session:: S8203

2011-S1170 (ACTIVE) - Summary

Authorizes municipalities to, on or before December 31, 2011, enter into contracts to sell delinquent real property tax liens to private parties.

2011-S1170 (ACTIVE) - Sponsor Memo

                                BILL NUMBER:S1170

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,
2011. The authority to enter into such contracts sunsets on December
31, 2013. 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:
2009-10:   S.8203/A.982 - Referred to Rules/Referred to
Real Property Taxation
2007-2008: A.1253
2005-2006: A.6573

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, 2013.

2011-S1170 (ACTIVE) - Bill Text download pdf

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

                                  1170

                       2011-2012 Regular Sessions

                            I N  S E N A T E

                             January 5, 2011
                               ___________

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

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 ELEV-
EN, 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 THIRTEEN,  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

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD02156-01-1

S. 1170                             2

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;
  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  THIRTEEN  BUT  NOT  EARLIER
THAN  MAY  FIRST, TWO THOUSAND THIRTEEN, 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

S. 1170                             3

CITY,  COUNTY  OR VILLAGE, OR BY ANY OTHER SPECIAL, GENERAL OR LOCAL LAW
IN THE CALENDAR YEARS TWO THOUSAND TEN,  TWO  THOUSAND  ELEVEN  AND  TWO
THOUSAND TWELVE.
  S  2.  This act shall take effect immediately, and shall expire and be
deemed repealed on and after December 31, 2013.

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