Thirty-One properties remain after Upset Sale

A smooth Upset Sale was completed on Monday by the Potter County Tax Claim Bureau. Todd Brown, who was appointed TCB director earlier this year, was assisted by Deanna Johnston (right) and Linda Gambino. A concerted effort by Potter County Tax Claim Bureau staff led to the county collecting more than $150,000 in delinquent taxes and fees prior to Monday's auction.

Thirty-one properties remain unsold after bidding at the Upset Sale, which saw disposal of only two properties on which 2007 taxes were owed.

As of Thursday, 100 properties were still listed for upset sale; that number shrank to 33 by 9 am Monday as property owners made payments in order to avoid having their holdings sold.

Tax Claim Bureau Director Todd Brown and staff opened the offi ce Saturday morning to prepare for the sale and accommodate lastminute arrangements. Over the past several days they had telephoned or visited property owners to "remind, cajole and get them to come in," Brown said.

He called the extra effort "very successful," noting that 10 individuals had come in on Saturday morning to pay or make arrangements. In all, $155,608 in back taxes was collected between Sept. 8-14. That's approximately eight percent of the $2,004,713 in back taxes currently owed to the county, municipalities and school districts.

While the county collects the money and disburses it to the taxing bodies, its share of the total overdue taxes is just $431,000, with municipalities accounting for $200,000 and the six school districts taking up the lions' share of more than $1.3 million.

Quarterly payments on owner-occupied properties have previously been permitted; this year a new monthly installment payment plan was offered to taxpayers having trouble meeting their obligations, provided they had not breached any prior contract.

"It has been a success, with the lower payments -- and people have monthly payments in their heads, so it's easier to remember," Brown said. "It takes a little more homework on our part, and the downside is that you've now multiplied your opportunity to breach a contract, going from four quarterly to 11 monthly payments."

Another downside is that allowing a property to get as far as the tax sale can raise the amount due by 25 to 30 percent. So individuals who can actually afford to pay but hold off because they think their money is better invested elsewhere until the last minute "aren't looking at the full picture," Brown observed. Taxes which become delinquent are assessed a 10 percent penalty; the bureau assesses another nine percent penalty when they're turned in for collection, and an additional nine percent in the tax sale year. So taxes that were originally $1,000 can rise to nearly $1,300 between the time they're first due and the tax sale - and that's not counting approximately $200 in fees for claims notices, posting, etc. that are also attached.

Those who miss a payment arrangement are subject to having their property listed and ultimately sold through the next annual Upset Sale.

"The county tries to work it out with people so they don't lose their homes," Brown said. "It's my personal belief that the county - the Tax Claim Bureau - is not out to sell properties. Our business is just to collect back taxes." Monday morning's upset sale was delayed for approximately 15 minutes because a property owner came in to negotiate a payment plan.

Arrangements aren't available on non-owner occupied or commercial property, although Brown said the staff tries to exercise common sense in some cases - for example, an instance where a homeowner might operate a business out of the garage.

Many properties attract no bids during the Upset Sale due to liens and other factors that would encumber the buyer. Properties are sold caveat emptor ("buyer beware"), with no guarantee of clear title. Brown said an individual interested in one of Monday's properties visited the Recorder of Deeds office beforehand and learned that there was already a substantial mortgage owed, for which he could have been liable if he bought the property.

"That's where 'buyer beware' comes in, and it applies to the continuance sale as well," Brown pointed out.

Properties which attract no bidders are designated for the continuance sale, a judicial sale, or for the county repository. The continuance sale is scheduled for Monday, Sept. 28, at 9 am in the courtroom.

While in the later judicial sale the county sets a minimum bid in an attempt to recover outstanding taxes, all mortgages, liens and encumbrances are wiped clean. Because an attempt must be made to notify banks and mortgage companies with interest in the properties, more time elapses between the continuance and judicial sale.

"The judicial sale is at minimum several months away," Brown said.