BILL NUMBER:S5767

TITLE OF BILL:

An act to amend chapter 602 of the laws of 1993 amending the real
property tax law relating to the enforcement of the collection of
delinquent real property taxes and to the collection of taxes by
banks, in relation to the enforcement of the collection of taxes in
certain villages

PURPOSE OR GENERAL IDEA OF BILL:

To extend for three additional years the authority for villages to
hold annual tax lien sales as a means of enforcing collection of
delinquent taxes.

SUMMARY OF SPECIFIC PROVISIONS:

Amends subdivision (c) of § 6 of Chapter 602 of the Laws of 1993, to
provide that any village which adopted a local law by September 1,
1994, authorizing such village to continue to enforce unpaid property
taxes by tax lien sale, may continue to hold tax lien sales for
village taxes which become liens in 2016, 2017 and 2018.

JUSTIFICATION:

              

Chapter 602 of the Laws of 1993, which became effective on January
1,1995, comprehensively reformed the method by which local governments
enforce the collection of unpaid real property taxes.  Part of that
reform included eliminating municipal authority to enforce unpaid
taxes via tax lien sales. However, Chapter 602 authorized counties,
cities and towns with local charters that included tax enforcement
provisions including tax lien sales to opt out of the new enforcement
system by adopting a local law prior to July 1, 1994. To address the
needs of the 165 villages for whom their county does not enforce
village taxes, the Legislature then enacted Chapter 532 of the Laws of
1994, amending Chapter 602 to provide that any village using tax lien
sales as a means of tax enforcement was authorized to enact a local
law retaining the right to continue to hold annual tax lien sales for
village taxes that became liens in 1995, 1996 and 1997. This was then
extended several times to allow for tax lien sales through 2012. More
than 100 villages passed such a local law, and continue to rely upon
tax lien sales.

A tax lien sale is NOT the public sale of property, but rather the
public sale of the current year's delinquent property taxes on a
property. By selling such liens, villages are able to recoup the
outstanding delinquent taxes owed the village, including interest
penalties and charges.

Additionally, the public notice of the impending sale of tax liens
serves to encourage delinquent taxpayers to remit full payment of
their property taxes. For many villages, particularly in the downstate
region, annual tax lien sales serve as a critical cash flow device.
without such tax lien sales, villages would be required to raise an
additional amount of property taxes to cover delinquencies.  This bill


would allow villages to continue to use tax lien sales for village
taxes levied in 2016, 2017 and 2018.

PRIOR LEGISLATIVE HISTORY:

This is a new bill. The previous extension of this legislation was
included in Chapter 154 of the Laws of 2012.

FISCAL IMPLICATIONS:

None to the State. will enable tax enforcing villages to continue
holding tax lien sales to reduce their tax delinquency liability,
thereby relieving pressure on the property tax.

EFFECTIVE DATE:

This act shall take effect immediately.