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STATE OF NEW YORK
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403--A

2011-2012 Regular Sessions

IN ASSEMBLY

(PREFILED)

January 5, 2011
___________

Introduced  by M. of A. GUNTHER -- read once and referred to the Commit-
  tee on Real Property Taxation -- recommitted to the Committee on  Real
  Property  Taxation  in  accordance  with  Assembly  Rule  3, sec. 2 --
  committee discharged, bill amended, ordered reprinted as  amended  and
  recommitted to said committee

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:

  Section  1.  The  general  city law is amended by adding a new section
21-a to read as follows:
  S 21-A. COLLECTION OF  DELINQUENT  TAX  LIENS.    NOTWITHSTANDING  ANY
PROVISION OF ANY GENERAL, SPECIAL OR LOCAL LAW TO THE CONTRARY AND UNTIL
DECEMBER  THIRTY-FIRST,  TWO THOUSAND SIXTEEN, ANY CITY MAY ENTER INTO A
CONTRACT TO SELL SOME OR ALL OF THE DELINQUENT  TAX  LIENS  HELD  BY  IT
WHICH  HAVE  BEEN  ATTACHED  TO  REAL  PROPERTY  ON  OR  BEFORE  JANUARY
THIRTY-FIRST, TWO THOUSAND SEVENTEEN, TO A PRIVATE PARTY, SUBJECT TO THE
FOLLOWING CONDITIONS:
  1. PRIOR TO ANY SALE, THE CITY COUNCIL SHALL HOLD A PUBLIC HEARING, ON
NOTICE OF AT LEAST FORTY-FIVE DAYS, ANNOUNCING THE INTENTION OF THE CITY
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.  UPON  THE  APPROVAL OF THE CITY COUNCIL AND BY ADOPTION OF A LOCAL
LAW, ANY CITY SHALL BE AUTHORIZED TO SELL DELINQUENT TAX LIENS  AND  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 THE REAL PROPERTY TAX LAW.

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD02326-03-2
A. 403--A                           2

FAILURE TO PROVIDE SUCH NOTICE  OR  THE  FAILURE  OF  THE  ADDRESSEE  TO
RECEIVE THE SAME SHALL INVALIDATE ANY SALE OF A TAX LIEN OR TAX LIENS.
  4.  THE  CITY  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 TO THE CITY A LIST OF LIENS TO BE
FORECLOSED. THE CITY 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 AND MAY
INCLUDE ANY ACCRUED INTEREST AND  REASONABLE  AND  NECESSARY  COLLECTION
FEES  INCURRED  BY  THE TAX LIEN PURCHASER. THE TAX LIEN PURCHASER SHALL
PROVIDE THE FORECLOSURE LIST TO  THE  CITY  ALONG  WITH  THE  APPLICABLE
REPURCHASE  PRICE  OF  EACH  LIEN, BY CERTIFIED MAIL, AND THE CITY SHALL
HAVE THIRTY DAYS FROM RECEIPT TO NOTIFY THE TAX LIEN  PURCHASER  OF  ITS
OPTION  TO  PURCHASE  ONE  OR  MORE  OF  THE  LIENS. IF THE CITY 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 CITY SHALL
FAIL TO OPT TO REPURCHASE THE LIEN OR LIENS THE TAX LIEN PURCHASER SHALL
HAVE THE RIGHT TO COMMENCE A FORECLOSURE ACTION ONLY AFTER THE PURCHASER
HAS GIVEN WRITTEN NOTICE TO THE PROPERTY OWNER AT THE LAST KNOWN ADDRESS
AS  LISTED  ON  THE ASSESSMENT ROLL OF THE CITY THAT SAID PROPERTY OWNER
HAS THE RIGHT TO ENTER INTO A  PAYMENT  PLAN  OF  AT  LEAST  TWENTY-FOUR
MONTHS  BUT  NO  LONGER  THAN FORTY-EIGHT MONTHS TO REPAY THE TAX AMOUNT
OWED. THE TAX LIEN PURCHASER SHALL HAVE THE RIGHT  TO  CHARGE  THE  SAME
INTEREST  AS  WAS  ACCRUING  ON  THE  TAX LIEN CERTIFICATE. THE TAX LIEN
PURCHASER SHALL NOT BE ALLOWED TO CHARGE ANY OTHER FEES, COSTS OR CHARG-
ES EXCEPT THOSE EXPRESSLY ALLOWED HEREIN UNDER THIS SECTION.
  6. THE SALE OF A TAX LIEN PURSUANT TO THIS SECTION SHALL  NOT  OPERATE
TO  SHORTEN  THE  OTHERWISE  APPLICABLE  REDEMPTION PERIOD OR CHANGE THE
OTHERWISE 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 AS PROVIDED IN SECTION ELEVEN HUNDRED
NINETY-FOUR  OF  THE REAL PROPERTY TAX LAW. THE PROCEDURE IN SUCH ACTION
SHALL BE THE SAME PROCEDURE AS 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, MAY INCLUDE REASONABLE AND NECESSARY COLLECTION
COSTS AND LEGAL FEES.
  8. IN EACH YEAR SUBSEQUENT TO THE TAX LIEN  SALE,  AND  NO  MORE  THAN
SIXTY  DAYS  AFTER THE ANNUAL ANNIVERSARY OF SUCH SALE, THE CITY COUNCIL
OR THEIR DESIGNEE SHALL PREPARE A REPORT ON THE STATUS  AND  RESULTS  OF
SUCH SALE. SUCH REPORT SHALL INCLUDE, BUT NEED NOT BE LIMITED TO, INFOR-
MATION  ON  THE TOTAL DOLLAR AMOUNT RECEIVED BY THE MUNICIPALITY IN SUCH
SALE, THE NUMBER OF FORECLOSURES  CONDUCTED  BY  THE  THIRD  PARTY,  THE
NUMBER  OF PAYMENT PLANS ENTERED INTO BY TAXPAYERS AND THE STATUS THERE-
OF, THE NUMBER, IF ANY, OF COMPLAINTS ABOUT THE FORECLOSURE PROCESS, THE
NUMBER OF PROPERTIES TAKEN BACK BY THE CITY PURSUANT TO  THE  TERMS  AND
CONDITIONS  OF  THE  CONTRACT OF SALE, THE NUMBER, IF ANY, OF COMPLAINTS
RECEIVED BY THE CITY ON THE CONDUCT OF THE ACTIONS OF  THE  THIRD  PARTY
AND  ANY  OTHER INFORMATION THE CITY COUNCIL DEEMS NECESSARY AND PROPER.
SUCH REPORT SHALL BE FILED WITH THE STATE COMPTROLLER  FOR  HIS  OR  HER
REVIEW.  THE  STATE  COMPTROLLER  SHALL  ANNUALLY  PREPARE  A REPORT FOR
SUBMISSION TO THE GOVERNOR, THE TEMPORARY PRESIDENT OF THE  SENATE,  THE
SPEAKER  OF THE ASSEMBLY, AND TO THE RESPECTIVE MINORITY LEADERS IN BOTH
A. 403--A                           3

THE SENATE AND ASSEMBLY WHICH DETAILS THE EXPERIENCES OF ALL CITIES THAT
PARTICIPATED IN SUCH PROGRAM TO COLLECT DELINQUENT TAX LIENS AS PROVIDED
FOR IN SECTION THREE OF THE CHAPTER OF THE LAWS OF TWO  THOUSAND  TWELVE
THAT ADDED THIS SECTION.
  9. THE PROVISIONS OF TITLE FIVE OF ARTICLE ELEVEN OF THE REAL PROPERTY
TAX  LAW SHALL APPLY SO FAR AS IS PRACTICABLE TO A CONTRACT FOR THE SALE
OF TAX LIENS PURSUANT TO THIS SECTION.
  S 2. Section 6 of chapter 602 of the laws of 1993  amending  the  real
property tax law relating to the enforcement of the collection of delin-
quent  real  property  taxes and to the collection of taxes by banks, is
amended by adding a new subdivision (d) to read as follows:
  (D) NOTWITHSTANDING ANY PROVISION OF ANY GENERAL, SPECIAL OR LOCAL LAW
TO THE CONTRARY AND UNTIL DECEMBER 31, 2016, ANY VILLAGE MAY ENTER  INTO
A  CONTRACT  TO  SELL SOME OR ALL OF THE DELINQUENT TAX LIENS HELD BY IT
WHICH HAVE BEEN ATTACHED TO REAL PROPERTY ON OR BEFORE JANUARY 31, 2017,
TO A PRIVATE PARTY, SUBJECT TO THE FOLLOWING CONDITIONS:
  (1) PRIOR TO ANY SALE, THE BOARD OF TRUSTEES SHALL HOLD A PUBLIC HEAR-
ING, ON NOTICE OF AT LEAST 45 DAYS,  ANNOUNCING  THE  INTENTION  OF  THE
VILLAGE TO SELL ITS DELINQUENT REAL PROPERTY TAX LIENS TO A THIRD PARTY.
SUCH HEARING SHALL NOT BE HELD MORE THAN 90 DAYS PRIOR TO SUCH SALE.
  (2)  UPON  THE  APPROVAL OF THE BOARD OF TRUSTEES AND BY ADOPTION OF A
LOCAL LAW, THE BOARD SHALL AUTHORIZE THE SALE  OF  SAID  DELINQUENT  TAX
LIENS AND 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 30 DAYS ADVANCE NOTICE OF
SUCH SALE IN THE SAME FORM AND MANNER AS IS PROVIDED BY SUBDIVISION 2 OF
SECTION 1190 OF THE REAL PROPERTY  TAX  LAW.  FAILURE  TO  PROVIDE  SUCH
NOTICE OR THE FAILURE OF THE ADDRESSEE TO RECEIVE THE SAME SHALL INVALI-
DATE 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 VILLAGE SHALL SET THE TERMS AND CONDITIONS OF THE CONTRACT OF
SALE.
  (5) THE TAX LIEN PURCHASER MUST, 30 DAYS PRIOR TO THE COMMENCEMENT  OF
ANY  FORECLOSURE  ACTION,  PROVIDE  TO THE VILLAGE A LIST OF LIENS TO BE
FORECLOSED. THE VILLAGE MAY, AT ITS SOLE OPTION AND  DISCRETION,  REPUR-
CHASE A LIEN OR LIENS ON THE FORECLOSURE LIST FROM THE TAX LIEN PURCHAS-
ER.  THE  REPURCHASE  PRICE SHALL BE THE AMOUNT OF THE LIEN OR LIENS AND
MAY INCLUDE ANY ACCRUED INTEREST AND REASONABLE AND NECESSARY COLLECTION
FEES INCURRED BY THE TAX LIEN PURCHASER. THE TAX  LIEN  PURCHASER  SHALL
PROVIDE  THE  FORECLOSURE  LIST TO THE VILLAGE ALONG WITH THE APPLICABLE
REPURCHASE PRICE OF EACH LIEN, BY CERTIFIED MAIL, AND THE VILLAGE  SHALL
HAVE 30 DAYS FROM RECEIPT TO NOTIFY THE TAX LIEN PURCHASER OF ITS OPTION
TO  PURCHASE  ONE  OR MORE OF THE LIENS. IF THE VILLAGE OPTS TO PURCHASE
THE LIEN, IT SHALL PROVIDE PAYMENT WITHIN 30  DAYS  OF  RECEIPT  OF  THE
REPURCHASE PRICE OF SAID LIEN OR LIENS. IF THE VILLAGE SHALL FAIL TO OPT
TO  REPURCHASE  THE  LIEN OR LIENS THE TAX LIEN PURCHASER SHALL HAVE THE
RIGHT TO COMMENCE A FORECLOSURE ACTION  ONLY  AFTER  THE  PURCHASER  HAS
GIVEN  WRITTEN NOTICE TO THE PROPERTY OWNER AT THE LAST KNOWN ADDRESS AS
LISTED ON THE ASSESSMENT ROLL OF THE VILLAGE THAT  SAID  PROPERTY  OWNER
HAS  THE RIGHT TO ENTER INTO A PAYMENT PLAN OF AT LEAST 24 MONTHS BUT NO
LONGER THAN 48 MONTHS TO  REPAY  THE  TAX  AMOUNT  OWED.  THE  TAX  LIEN
PURCHASER SHALL HAVE THE RIGHT TO CHARGE THE SAME INTEREST AS WAS ACCRU-
ING  ON  THE  TAX  LIEN CERTIFICATE. THE TAX LIEN PURCHASER SHALL NOT BE
ALLOWED TO CHARGE ANY OTHER FEES, COSTS OR CHARGES EXCEPT THOSE EXPRESS-
LY ALLOWED HEREIN UNDER THIS SUBDIVISION.
A. 403--A                           4

  (6) THE SALE OF A TAX LIEN PURSUANT  TO  THIS  SUBDIVISION  SHALL  NOT
OPERATE  TO SHORTEN THE OTHERWISE APPLICABLE REDEMPTION PERIOD OR CHANGE
THE OTHERWISE 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 AS PROVIDED IN SECTION 1194 OF
THE REAL PROPERTY TAX LAW. THE PROCEDURE IN SUCH  ACTION  SHALL  BE  THE
SAME  PROCEDURE AS PRESCRIBED BY ARTICLE 13 OF THE REAL PROPERTY ACTIONS
AND PROCEEDINGS LAW FOR  THE  FORECLOSURE  OF  MORTGAGES.  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 PROP-
ERTY, MAY INCLUDE REASONABLE AND NECESSARY COLLECTION  COSTS  AND  LEGAL
FEES.
  (8)  IN EACH YEAR SUBSEQUENT TO THE TAX LIEN SALE, AND NO MORE THAN 60
DAYS AFTER THE ANNUAL  ANNIVERSARY  OF  SUCH  SALE,  THE  VILLAGE  SHALL
PREPARE  A  REPORT  ON  THE STATUS AND RESULTS OF SUCH SALE. SUCH REPORT
SHALL INCLUDE, BUT NEED NOT BE LIMITED  TO,  INFORMATION  ON  THE  TOTAL
DOLLAR  AMOUNT  RECEIVED BY THE MUNICIPALITY IN SUCH SALE, THE NUMBER OF
FORECLOSURES CONDUCTED BY THE THIRD PARTY, THE NUMBER OF  PAYMENT  PLANS
ENTERED  INTO  BY  THE  TAXPAYERS AND THE STATUS THEREOF, THE NUMBER, IF
ANY, OF COMPLAINTS ABOUT THE FORECLOSURE PROCESS, THE NUMBER OF  PROPER-
TIES  TAKEN  BACK BY THE VILLAGE PURSUANT TO THE TERMS AND CONDITIONS OF
THE CONTRACT OF SALE, THE NUMBER, IF ANY, OF COMPLAINTS RECEIVED BY  THE
VILLAGE  ON  THE CONDUCT OF THE ACTIONS OF THE THIRD PARTY AND ANY OTHER
INFORMATION THE VILLAGE DEEMS NECESSARY AND PROPER. SUCH REPORT SHALL BE
FILED WITH THE STATE COMPTROLLER FOR HIS OR HER REVIEW. THE STATE  COMP-
TROLLER  SHALL ANNUALLY PREPARE A REPORT FOR SUBMISSION TO THE GOVERNOR,
THE TEMPORARY PRESIDENT OF THE SENATE, THE SPEAKER OF THE ASSEMBLY,  AND
TO THE RESPECTIVE MINORITY LEADERS IN BOTH THE SENATE AND ASSEMBLY WHICH
DETAILS  THE  EXPERIENCES  OF  ALL  VILLAGES  THAT  PARTICIPATED IN SUCH
PROGRAM TO COLLECT DELINQUENT TAX LIENS AS PROVIDED FOR IN SECTION 3  OF
THE CHAPTER OF THE LAWS OF 2012 THAT ADDED THIS SUBDIVISION.
  (9)  THE  PROVISIONS OF TITLE 5 OF ARTICLE 11 OF THE REAL PROPERTY TAX
LAW SHALL APPLY SO FAR AS IS PRACTICABLE TO A CONTRACT FOR THE  SALE  OF
TAX LIENS PURSUANT TO THIS SUBDIVISION.
  S  3.  The  state  comptroller  in  preparing  its  annual report that
outlines the experiences of all cities and villages  that  have  partic-
ipated  in  a program to collect delinquent tax liens as provided for in
section 21-a of the general city law and subdivision (d) of section 6 of
chapter 602 of the laws of 1993, shall include the following information
as provided for in this section. Such report shall briefly  outline  the
reports  submitted  by all participating municipalities, the cost effec-
tiveness of such program to enhance real property tax  collections,  the
aggregate  amount of tax revenue collected minus expenses, the number of
foreclosures conducted by third parties, the  number  of  payment  plans
entered  into  by taxpayers, the number and severity of complaints about
the foreclosure process, the number of properties taken back by  partic-
ipating municipalities, any complaints received by participating munici-
palities  from  tax  lien  debtors and the general public, and any other
items or suggestions that the state comptroller  may  make  to  increase
consumer  protections to assist real property owners who have delinquent
tax liens pending to retain their real property. Such  report  shall  be
issued by the state comptroller by July first of each year.
  S  4.  This act shall take effect immediately and shall expire January
31, 2017 when upon such date the provisions of this act shall be  deemed
repealed.