At issue are thousands of properties that cycle between treasurer sale and commissioner’s certificate sale and then back to treasurer sale churning fees for contractors each time
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July 9, 2017-The Lake County Treasurer is offering for sale approximately 12,000 properties which recently did not sell for a minimum bid of $500. Taxpayers will now pay hundreds of thousands of dollars to advertise and offer those properties for sale at an auction where the minimum bid is 20, 30 or even 100 times that amount. Is this a proper procedure or are the certifications listing the property for sale all erroneous?
Indiana Code provide clear rules for selling property. For background, Indiana has two types of “tax” sales. The first is a treasurer’s tax sale. According to Indiana Code, the Treasurer must certify a list of properties that are delinquent three installments or more and submit that list to the auditor. If the properties do not sell at treasurer’s tax sale, a commissioner’s certificate is created and offered for sale. Most important, Indiana Code provides that the County Executive acquires a lien on the properties and the taxes are to be charged back to the taxing units (cities, towns and other taxing districts):
Sec. 6. (a) When a tract or an item of real property is offered for sale under this chapter and an amount is not received equal to or in excess of the minimum sale price prescribed in section 5 of this chapter, the county executive acquires a lien in the amount of the minimum sale price. This lien attaches on the day on which the tract or item was offered for sale.
(b) When a county executive acquires a lien under this section, the county auditor shall issue a tax sale certificate to the county executive in the manner provided in section 9 of this chapter. The county auditor shall date the certificate the day that the county executive acquires the lien. When a county executive acquires a certificate under this section, the county executive has the same rights as a purchaser.
(c) When a lien is acquired by a county executive under this section, no money shall be paid by the county executive. However, each of the taxing units having an interest in the taxes on the tract shall be charged with the full amount of all delinquent taxes due them. See http://codes.findlaw.com/in/title-6-taxation/in-code-sect-6-1-1-24-6-1.html
The section on Commissioner’s Certificate sales expressly anticipates that there may be more than one commissioner certificate sale. What is not anticipated is that the Treasurer will re-offer the properties for sale. Logically,
this doesn’t even make sense. Properties are offered at a commissioner’s certificate sale with a starting bid of $500. At the treasurer’s sale, the minimum bid is all delinquent taxes and fees. If a property did not sell for the minimum bid of $500, what is the likelihood of someone bidding 10, 20 or even 50 times that amount in a treasurer sale?
What is at stake? Each tax sale, whether treasurer sale or commissioner certificate sale, costs the taxpayers hundreds of thousands of dollars. Advertising feels alone are several hundred thousand dollars. Those who conduct the sale are also paid a fee per parcel. When they do not sell at the treasurer’s sale, the properties will again become commissioner certificates and be offered for a minimum bid of $500. In some cases this process has been repeated over and over and over again in Lake County. But that is just the way we have always done things . . .nevermind the cost.