STATE OF NEW YORK
________________________________________________________________________
2257--B
Cal. No. 232
2013-2014 Regular Sessions
IN SENATE
January 15, 2013
___________
Introduced by Sens. KLEIN, ADDABBO, DILAN -- read twice and ordered
printed, and when printed to be committed to the Committee on Cities
-- recommitted to the Committee on Cities in accordance with Senate
Rule 6, sec. 8 -- reported favorably from said committee, ordered to
first and second report, ordered to a third reading, amended and
ordered reprinted, retaining its place in the order of third reading
-- again amended and ordered reprinted, retaining its place in the
order of third reading
AN ACT to amend the general city law and 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 collection of delinquent real prop-
erty taxes; and providing for the repeal of such provisions upon expi-
ration thereof
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. The general city law is amended by adding a new section
2 21-a to read as follows:
3 § 21-a. Collection of delinquent tax liens. Notwithstanding any
4 provision of any general, special or local law to the contrary and until
5 December thirty-first, two thousand eighteen, any city may enter into a
6 contract to sell some or all of the delinquent tax liens held by it
7 which have been attached to real property on or before January thirty-
8 first, two thousand nineteen, to a private party, subject to the follow-
9 ing conditions:
10 1. Prior to any sale, the city council shall hold a public hearing, on
11 notice of at least forty-five days, announcing the intention of the city
12 to sell its delinquent real property tax liens to a third party. Such
13 hearing shall not be held more than ninety days prior to such sale.
14 2. Upon the approval of the city council and by adoption of a local
15 law, any city shall be authorized to sell delinquent tax liens and the
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD02366-07-4
S. 2257--B 2
1 consideration to be paid may be more or less than the face amount of the
2 tax liens sold.
3 3. Property owners shall be given at least thirty days advance notice
4 of such sale in the same form and manner as is provided by subdivision
5 two of section eleven hundred ninety of the real property tax law.
6 Failure to provide such notice or the failure of the addressee to
7 receive the same shall invalidate any sale of a tax lien or tax liens.
8 4. The city shall set the terms and conditions of the contract of
9 sale.
10 5. Upon the sale of such delinquent tax liens, the city shall file, in
11 the county clerk's office, as indexed against the name of the assessed
12 property owner and by section, block and lot of such parcel, notice of
13 such sale for each parcel of real property included in the sale, and
14 shall include in the notice the name, address and telephone number of
15 the tax lien purchaser.
16 6. The tax lien purchaser must, thirty days prior to the commencement
17 of any foreclosure action, provide to the city a list of liens to be
18 foreclosed. The city may, at its sole option and discretion, repurchase
19 a lien or liens on the foreclosure list from the tax lien purchaser. The
20 repurchase price shall be the amount at which the city sold the lien or
21 liens to the tax lien purchaser and may include any accrued interest.
22 The tax lien purchaser shall provide the foreclosure list to the city
23 along with the applicable repurchase price of each lien, by certified
24 mail, and the city shall have thirty days from receipt to notify the tax
25 lien purchaser of its option to purchase one or more of the liens. If
26 the city opts to purchase the lien, it shall provide payment within
27 thirty days of receipt of the repurchase price of said lien or liens. If
28 the city shall fail to opt to repurchase the lien or liens the tax lien
29 purchaser shall have the right to commence a foreclosure action only
30 after the purchaser has given written notice to the property owner at
31 the last known address as listed on the assessment roll of the city that
32 said property owner has the right to enter into a payment plan of at
33 least twenty-four months but no longer than forty-eight months to repay
34 the tax amount owed. The tax lien purchaser shall have the right to
35 charge the same interest as was accruing on the tax lien certificate.
36 The tax lien purchaser shall not be allowed to charge any other fees,
37 costs or charges except those expressly allowed herein under this
38 section.
39 7. The sale of a tax lien pursuant to this section shall not operate
40 to shorten the otherwise applicable redemption period or change the
41 otherwise applicable interest rate.
42 8. Upon the expiration of the redemption period prescribed by law, the
43 purchaser of a delinquent tax lien, or its successors or assigns, may
44 foreclose the lien as in an action as provided in section eleven hundred
45 ninety-four of the real property tax law. The procedure in such action
46 shall be the same procedure as prescribed by article thirteen of the
47 real property actions and proceedings law for the foreclosure of mort-
48 gages. At any time following the commencement of an action to foreclose
49 a lien, the amount required to redeem the lien, or the amount received
50 upon sale of a property, may include reasonable and necessary collection
51 costs and legal fees.
52 9. In the event that the owner of real property subject to a delin-
53 quent tax lien purchased by a tax lien purchaser pays the delinquent
54 taxes and interest owed upon such real property within the applicable
55 redemption period, or the tax lien purchaser sells, in a foreclosure
56 action, its interest in real property, such tax lien purchaser, or its
S. 2257--B 3
1 successors or assigns, shall, within ten days of such redemption or
2 sale, file, in the county clerk's office, a notice of its termination of
3 all right, title and interest in the parcel of real property. The fail-
4 ure to comply with the provisions of this subdivision shall result in
5 the imposition of a civil penalty of one hundred dollars by the county
6 clerk.
7 10. Notwithstanding any provision of law to the contrary, in the event
8 that a delinquent tax lien purchaser has not commenced an action to
9 foreclose upon a parcel of real property within two years of the filing
10 of the notice relating to such property pursuant to subdivision five of
11 this section, such notice shall be deemed by law to be null and void.
12 11. In each year subsequent to the tax lien sale, and no more than
13 sixty days after the annual anniversary of such sale, the city council
14 or their designee shall prepare a report on the status and results of
15 such sale. Such report shall include, but need not be limited to, infor-
16 mation on the total dollar amount received by the municipality in such
17 sale, the number of foreclosures conducted by the third party, the
18 number of payment plans entered into by taxpayers and the status there-
19 of, the number, if any, of complaints about the foreclosure process, the
20 number of properties taken back by the city pursuant to the terms and
21 conditions of the contract of sale, the number, if any, of complaints
22 received by the city on the conduct of the actions of the third party
23 and any other information the city council deems necessary and proper.
24 Such report shall be filed with the state comptroller for his or her
25 review. The state comptroller shall annually prepare a report for
26 submission to the governor, the temporary president of the senate, the
27 speaker of the assembly, and to the respective minority leaders in both
28 the senate and assembly which details the experiences of all cities that
29 participated in such program to collect delinquent tax liens as provided
30 for in section three of the chapter of the laws of two thousand fourteen
31 that added this section.
32 12. The provisions of title five of article eleven of the real proper-
33 ty tax law shall apply so far as is practicable to a contract for the
34 sale of tax liens pursuant to this section.
35 § 2. Section 6 of chapter 602 of the laws of 1993 amending the real
36 property tax law relating to the enforcement of the collection of delin-
37 quent real property taxes and to the collection of taxes by banks, is
38 amended by adding a new subdivision (d) to read as follows:
39 (d) Notwithstanding any provision of any general, special or local law
40 to the contrary and until December 31, 2018, any village may enter into
41 a contract to sell some or all of the delinquent tax liens held by it
42 which have been attached to real property on or before January 31, 2019,
43 to a private party, subject to the following conditions:
44 (1) Prior to any sale, the board of trustees shall hold a public hear-
45 ing, on notice of at least 45 days, announcing the intention of the
46 village to sell its delinquent real property tax liens to a third party.
47 Such hearing shall not be held more than 90 days prior to such sale.
48 (2) Upon the approval of the board of trustees and by adoption of a
49 local law, the board shall authorize the sale of said delinquent tax
50 liens and the consideration to be paid may be more or less than the face
51 amount of the tax liens sold.
52 (3) Property owners shall be given at least 30 days advance notice of
53 such sale in the same form and manner as is provided by subdivision 2 of
54 section 1190 of the real property tax law. Failure to provide such
55 notice or the failure of the addressee to receive the same shall invali-
S. 2257--B 4
1 date any sale of a tax lien or tax liens or the validity of the taxes or
2 interest prescribed by law with respect thereto.
3 (4) The village shall set the terms and conditions of the contract of
4 sale.
5 (5) Upon the sale of such delinquent tax liens, the village shall
6 file, in the county clerk's office, as indexed against the name of the
7 assessed property owner and by section, block and lot of such parcel,
8 notice of such sale for each parcel of real property included in the
9 sale, and shall include in the notice the name, address and telephone
10 number of the tax lien purchaser.
11 (6) The tax lien purchaser must, 30 days prior to the commencement of
12 any foreclosure action, provide to the village a list of liens to be
13 foreclosed. The village may, at its sole option and discretion, repur-
14 chase a lien or liens on the foreclosure list from the tax lien purchas-
15 er. The repurchase price shall be the amount at which the village sold
16 the lien or liens to the tax lien purchaser and may include any accrued
17 interest. The tax lien purchaser shall provide the foreclosure list to
18 the village along with the applicable repurchase price of each lien, by
19 certified mail, and the village shall have 30 days from receipt to noti-
20 fy the tax lien purchaser of its option to purchase one or more of the
21 liens. If the village opts to purchase the lien, it shall provide
22 payment within 30 days of receipt of the repurchase price of said lien
23 or liens. If the village shall fail to opt to repurchase the lien or
24 liens the tax lien purchaser shall have the right to commence a foreclo-
25 sure action only after the purchaser has given written notice to the
26 property owner at the last known address as listed on the assessment
27 roll of the village that said property owner has the right to enter into
28 a payment plan of at least 24 months but no longer than 48 months to
29 repay the tax amount owed. The tax lien purchaser shall have the right
30 to charge the same interest as was accruing on the tax lien certificate.
31 The tax lien purchaser shall not be allowed to charge any other fees,
32 costs or charges except those expressly allowed herein under this subdi-
33 vision.
34 (7) The sale of a tax lien pursuant to this subdivision shall not
35 operate to shorten the otherwise applicable redemption period or change
36 the otherwise applicable interest rate.
37 (8) Upon the expiration of the redemption period prescribed by law,
38 the purchaser of a delinquent tax lien, or its successors or assigns,
39 may foreclose the lien as in an action as provided in section 1194 of
40 the real property tax law. The procedure in such action shall be the
41 same procedure as prescribed by article 13 of the real property actions
42 and proceedings law for the foreclosure of mortgages. At any time
43 following the commencement of an action to foreclose a lien, the amount
44 required to redeem the lien, or the amount received upon sale of a prop-
45 erty, may include reasonable and necessary collection costs and legal
46 fees.
47 (9) In the event that the owner of real property subject to a delin-
48 quent tax lien purchased by a tax lien purchaser pays the delinquent
49 taxes and interest owed upon such real property within the applicable
50 redemption period, or the tax lien purchaser sells, in a foreclosure
51 action, its interest in real property, such tax lien purchaser, or its
52 successors or assigns, shall, within 10 days of such redemption or sale,
53 file, in the county clerk's office, a notice of its termination of all
54 right, title and interest in the parcel of real property. The failure to
55 comply with the provisions of this subdivision shall result in the impo-
56 sition of a civil penalty of one hundred dollars by the county clerk.
S. 2257--B 5
1 (10) Notwithstanding any provision of law to the contrary, in the
2 event that a delinquent tax lien purchaser has not commenced an action
3 to foreclose upon a parcel of real property within two years of the
4 filing of the notice relating to such property pursuant to paragraph
5 five of this subdivision, such notice shall be deemed by law to be null
6 and void.
7 (11) In each year subsequent to the tax lien sale, and no more than 60
8 days after the annual anniversary of such sale, the village shall
9 prepare a report on the status and results of such sale. Such report
10 shall include, but need not be limited to, information on the total
11 dollar amount received by the municipality in such sale, the number of
12 foreclosures conducted by the third party, the number of payment plans
13 entered into by the taxpayers and the status thereof, the number, if
14 any, of complaints about the foreclosure process, the number of proper-
15 ties taken back by the village pursuant to the terms and conditions of
16 the contract of sale, the number, if any, of complaints received by the
17 village on the conduct of the actions of the third party and any other
18 information the village deems necessary and proper. Such report shall be
19 filed with the state comptroller for his or her review. The state comp-
20 troller shall annually prepare a report for submission to the governor,
21 the temporary president of the senate, the speaker of the assembly, and
22 to the respective minority leaders in both the senate and assembly which
23 details the experiences of all villages that participated in such
24 program to collect delinquent tax liens as provided for in section 3 of
25 the chapter of the laws of 2014 that added this subdivision.
26 (12) The provisions of title 5 of article 11 of the real property tax
27 law shall apply so far as is practicable to a contract for the sale of
28 tax liens pursuant to this subdivision.
29 § 3. The state comptroller in preparing its annual report that
30 outlines the experiences of all cities and villages that have partic-
31 ipated in a program to collect delinquent tax liens as provided for in
32 section 21-a of the general city law and subdivision (d) of section 6 of
33 chapter 602 of the laws of 1993, shall include the following information
34 as provided for in this section. Such report shall briefly outline the
35 reports submitted by all participating municipalities, the cost effec-
36 tiveness of such program to enhance real property tax collections, the
37 aggregate amount of tax revenue collected minus expenses, the number of
38 foreclosures conducted by third parties, the number of payment plans
39 entered into by taxpayers, the number and severity of complaints about
40 the foreclosure process, the number of properties taken back by partic-
41 ipating municipalities, any complaints received by participating munici-
42 palities from tax lien debtors and the general public, and any other
43 items or suggestions that the state comptroller may make to increase
44 consumer protections to assist real property owners who have delinquent
45 tax liens pending to retain their real property. Such report shall be
46 issued by the state comptroller by July first of each year.
47 § 4. This act shall take effect immediately and shall expire January
48 31, 2019 when upon such date the provisions of this act shall be deemed
49 repealed.
