Town Council approves lien sale
By Evan Pajer - Staff Writer
East Hartford - posted Fri., Feb. 8, 2013
As East Hartford heads into budget season later this month, the Town Council heard from Finance Director Mike Walsh about a proposed lien sale that hopes to bring in $1.5 million in property taxes owed to the town. The sale could see properties foreclosed if the debt is purchased.
The Town Council referred a proposed tax lien sale to the council's committee on taxation. If approved, this would be the 10th year of lien sales, which allow potential buyers to purchase lien debt on unpaid property taxes. According to documents released by the town, the liens up for sale represent $1.5 million in property taxes owed to the town.
"If this motion is approved and the sale process goes on, the first thing that will happen is a certified mail letter sent to property owners - they will let the owners know that requests for proposal for property liens are being sent out," Walsh said. He added that the taxpayers can work out a payment plan with the town over a three-year period. "Property owners can come in and make a payment plan over three years. Essentially, they are doubling their tax burden for that period of time," Walsh said.
Walsh said that all of the property owners on the list of potential lien sales owed over $10,000 in taxes or owed taxes spanning three or more grand list years. "We have contacted the property owners multiple times about the situation already," Walsh said. According to a letter written by Walsh to Mayor Marcia Leclerc, the lien sale notice comes only after two published notices and three tax bills are sent to the property owners.
Documents released by the town about the potential sale state that owners looking for a payment plan must deposit 10 to 25 percent of their tax balance immediately and pay off the remaining amount over three years, while keeping current on their future tax payments.
Walsh said that in previous years, the lien sale has been a success for the town. "In most cases, the initial action brings in half to three-quarters of the taxes owed," he said. "It's an important part of keeping our tax enforcement in effect."
Walsh said that one of the biggest amounts owed came from a condominium complex on Burnside Avenue. "The LLC that owns the housing units there has not remitted taxes. They are in default," Walsh said.
The letter sent by Walsh to a Leclerc about the sale also included a sample of the letter that will be sent out to taxpayers whose properties are part of the sale. "When the tax liens on your property are sold," the sample letter states, "the purchaser of the tax liens shall have the right to foreclose on the property and you will likely lose all of your rights, title and interest on the property."
Walsh said in the letter that he hopes to have the lien sale completed by the end of June. "I would like to have the process completed by June 30 simply because bidding vendors have explained to me that their ability to successfully bid depends on their ability to secure credit," he said.
The council voted unanimously to refer the lien sale to their tax committee, where it is expected to pass.