WESTBROOK — A new delinquent tax payment policy will enable the city to sell or develop tax-foreclosed properties, but also has protections in place to keep families in their homes, according to City Administrator Jerre Bryant.

Outstanding property taxes on foreclosed properties owed to the city total $984,218, with some of the back taxes dating back to 1998. The city pulls in about $40 million in property taxes annually.

The city can initiate a tax foreclosure on properties with significant tax delinquencies in a process that takes about two years, Bryant said.

The new policy allows the city to take and use those properties if they are not family homes and goes into effect Nov. 8. Until then, an amnesty program that began Aug. 10 gives people who owe money the opportunity to pay the taxes due without interest.

Prior to the change, there was no defined policy on what the city could do with the properties it seizes, but the new policy allows it to use or sell the property to recoup some of the money owed.

“We don’t want to be kicking people out of their homes,” Bryant said. “We wanted to be more aggressive but simultaneously, with this change of policy, offer up an ability to true up, and that’s the amnesty program, which gives owner occupied residential properties an option to have the city forgive all of the interest that has accrued in exchange for a payoff of the actual principle due.”

According to City Tax Collector Dena Lebeda, 56 residential properties are tax foreclosed and behind on property tax.

Interest payments that could be eliminated through the amnesty program vary in amount, she said, with some people owing a few hundred dollars in interest up to one interest bill of $22,000. So far, four people have taken advantage of the of the amnesty program, Lebeda said.

There are 49 foreclosed parcels of land with back taxes owed, and four commercial properties.

“Vacant land, the city may want to do something with, or they may sell the land,” Lebeda said. “Family homes (that don’t take advantage of the amnesty program) will be looked at in a case by case basis.”

If a resident doesn’t use the amnesty program and opts not to pay their back taxes, the city will look into whether the owner could afford to square up with the city, Bryant said.

“If someone is struggling, we want to be sensitive to that,” Bryant said. “If someone fell behind, something happened, we can work with that, but we don’t want to let people just not pay if they had the ability to, when everyone else is,” he said.

If a family is allowed to stay in their home, the next owner of the property will be expected to pay the city the full amount owed, he said.

The homes of owners who “choose not to pay despite having the means to” will be sold, with the city keeping the amount equal to what is owed, as well as additional fees, according to the policy.

Bryant noted that it would take the city about two years to acquire a property, factoring in the time it takes for a lien to go into effect and after consistent “mailings and outreach” to owners.

“There is a reputation that the city doesn’t do anything,” Bryant said of delinquent taxpayers.

“It was ignored before, there is nothing pleasant about this,” he said. “It’s not like it’s causing the city to go to bankruptcy or anything, but I think it was something that either overtly or quietly people chose not to deal with.”

 

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