Philadelphia, April 30, 2015 – The City of Philadelphia announced that it is seeking vendor proposals for the implementation of a new real estate tax lien sale pilot program. The pilot program, an internet-based real estate tax lien sale auction, will occur in mid-June with approximately 1,000 properties. The solicitation for proposals to implement the tax lien sale is available on the Department of Revenue’s website (http://www.phila.gov/Revenue/Documents/Solicitation%20for%20Proposals%20Online%20Tax%20Lien%20Auction.pdf). Proposals are due by May 5.
“This pilot program is further evidence of our Administration’s commitment to collect all monies owed to the City. This effort sends a clear message to the tax scofflaws out there that Philadelphia will be relentless in its collection efforts,” said Mayor Michael A. Nutter. “This tax lien sale approach, if successful, will allow the City to quickly generate funds.”
The pilot program will make available real estate tax liens through an online auction. At the end of the auction, the tax lien will be transferred from the City to the third-party buyer with the highest bid. The transfer does not make the third-party purchaser, or “lien holder”, the owner of the property, but does allow the lien holder to begin foreclosure procedures should the lien, and any additional charges related to it, not be paid or resolved.
“Legislation I recently introduced will further enhance the value of lien sales by, among other things, removing fee caps on transferred liens,” said City Council President Darrell L. Clarke. “Nothing is more important to our city’s future than a quality public education for all kids. But before we ask more from taxpayers who dutifully and responsibly pay what they owe, we should exhaust all efforts to collect from those who are delinquent.”
Property owners whose properties currently have a tax lien will receive a letter of notice regarding the potential sale of their tax lien next week. Property owners will have two weeks to respond to the notice of lien sale by paying their debt in full or entering into a repayment agreement with the City.
A real estate tax lien is a legal claim against real property for unpaid real estate taxes and/or other charges, expenses and fees. All unpaid real estate taxes become liens against the property on January 1 the year after the tax was due.