Financial Report Leads to Discussion on Neglected Tax Liens

How the town handles tax liens on properties and the speed with which it collects on those properties prompted discussion last week. Finance Director Susan Hickey and Town Controller Doug Smith gave the Town Council an update on the fourth quarter financials at the July 15 Town Council meeting.

“For FY13 revenues we are anticipating approximately $135,000 under the anticipated budget,” Hickey said. “We had a few shortfalls this year – motor vehicle permits underperformed by $140,000, interest income underperformed by $145,000 and impact fees budgeted at $80,000 per year for the police facility and the library. Since impact fees are under suspension, we can’t collect that money but we were able to collect $54,000 from FY 11,” Hickey said.

Hickey said some of the excess revenues were from interest earnings of $168,000 from two properties that were tax deeded in 2009 and were paid off. “Departmental income excess is $245,000, which includes the cable studio, now part of the general fund, and insurance reimbursements (of) $43,000, which is for workmen’s compensation and short-term disability claims,” Hickey said.

Hickey said expenditures were anticipated to be $255,000 under budget. “There are two areas that we were over this year – legal (at) $218,000 right now and fire, which is probably going to be about $230,000 over,” she added. “So the total surplus of the fiscal year 2013 is estimated at approximately $120,000, and I can come back in August to give you the final numbers.”

The fire overage is for overtime. “In March of 2013, the Town Manager and I met with the Tax Collector/ Town Clerk and were given about six pages of properties that needed liening and deeding, and through that process we contacted several of those individuals and we got paid on most of those, to the point where we deeded eight properties, and of those eight properties, seven of them right now are seeking funding through mortgage companies, families, friends in order to redeem their properties,” Hickey said. That leaves one that is not working on paying back the town.

Hickey said the eight are in addition to the properties that were deeded in 2009.
“One closed successfully at a sale last week and the other the mortgage company paid an additional $168,000 interest penalties and back taxes so we were able to successfully collect on those two,” Hickey said.

Councilor Tom Freda asked if they collected the full amount and Hickey said they did. Hickey said there were about 10 properties that were tax deeded in the late ‘80s and early ‘90s that she and Acting Town Manager William Hart will be working on “to bring to resolution.” Freda said that if a property were tax deeded in the ‘80s, “I imagine they haven’t paid in 20 years. Why are we waiting so long to sell them?”
“That’s a great question,” Hickey responded.
“One of the things we looked at in the last year was these accounts that have not been addressed for a variety of reasons, some entirely appropriate,” Hart said. “For example, some of these tax situations are homes lived in by people with young children or sometimes elderly folks. Myself and other past managers didn’t feel it was appropriate to put them out on the street.”
He said that with those situations resolved, he and Hickey went through the entire list of several hundred properties and decided to act on every one of them where they could do so.
“The last group was from the ‘80s,” he said. “We were in the same boat that you’re in. Why are they here, what do we do with them. How do we resolve them, and let’s get them off the books. So that’s our next step.”
Hickey said one of the properties in question was landlocked, with no structure on it. “We need to get somebody to look at it to determine property lines and we need to have conversations with our assessor to figure out what we need to do,” she said.
She said another property abuts conservation land and she wants to check whether the conservation commission had any interest in it. “It’s a wet area and not buildable,” she said.
Hickey said that over the years there have been condos where no one lives and that do not carry a mortgage, and the owner has abandoned them.
I don’t think we have any of those, and those that we did have that we found, we were able to sell at a tax sale,” Hickey concluded.

Both comments and pings are currently closed.

Comments are closed.