ROCKINGHAM — State law lets towns and villages arrange to sell a property for delinquent taxes.
Around the state, this option is becoming more popular as a way for towns to raise money in an economy that has town governments watching every penny and citizens voting to send budgets back to be reworked.
In what is an unusual move for the town of Rockingham, the Selectboard and Village Trustees authorized Selectboard chair Thom MacPhee to act as the town agent at three recent tax sales, successfully bidding on 10 of the 14 such properties, effectively buying the properties back on the town's behalf for a total of approximately $90,000.
One property was withdrawn due to a challenge, and two attracted no bids. Another property was bid on successfully by a representative from Springfield Hospital.
“Properties that were not sold (had) all the accumulated charges from the process added to their accounts and can be paid at the town office,” Municipal Manager Willis “Chip” Stearns III said.
“The purpose of the town buying a property or starting the bid is to get the property back to a stage of actively paying taxes,” Stearns said.
He explained that it is important to know that all owners were notified of the pending sale, as were all recorded lien holders.
Both parties could have avoided the sale by paying in full all amounts owed prior to the bidding.
If a property is sold (even to a town), there is a 12-month period in which the delinquent property owner can reclaim the property for the purchase price, plus 1 percent per month, or fraction thereof, in interest.
If that option is exercised, the town is happy.
If the property is not redeemed, a tax collector's deed is issued and some prior liens are no longer enforceable.
Eventually, Stearns explained, “If the town obtains property through a tax-sale purchase, then we can sell it!”
And that is why towns in Vermont go through the routine: In the end, it helps bankroll their budgets.
“During the entire redemption period, new/current taxes will be billed and remain due on the property,” Stearns said.
Because “this can become an annual event on some properties, Tom was given authority to purchase on behalf of the town to break the cycle,” he added.
Stearns said previously, the “method was handled by the attorney, and the town had not bought any properties at tax sale. In fact, most never sold! That is why the town has purchased: to break that trend.”“Only now has the town opted back into purchasing properties. I would venture this has not happened for eight or more years,” Stearns mused. “I do not think the town owns or has sold any [properties] it acquired at tax sales since prior to 2006.”
With the exception of the former TLR paper mill at 14 Mill St. - a Superfund site for which the town is seeking proposals for revitalization - the last property the town acquired through this method was a trailer in Saxtons River.
“This recent tax sale will become the new benchmark going forward,” Stearns said.