Local News
July 28, 2016

Killington adopts new tax sale policy

By Stephen Seitz

KILLINGTON — At a special meeting held  July 19, the Board of Selectmen adopted a new policy on when to initiate tax sales of delinquent properties.

Under the previous rules, a property owner would get a year before the property went to tax sale. The new policy allows the town to initiate a tax sale 30 days after falling into delinquency.

Town Manager Debby Schwartz outlined the policy for the board of selectmen.

“One of my efforts to help improve the town’s financial status is to see what we could do within our tax collection policy,” said Schwartz. “I discovered that the latest policy concerning tax sales goes back to March of ‘09… That policy basically said if there was a delinquency greater than a year, that the tax sale could be initiated. I think that’s too long for the town to continue to carry that debt.”

Schwartz said once a property becomes delinquent, the taxes become delinquent after the final installment.

“This policy discusses how the person would be notified,” Schwartz  said, explaining: “they’d have a notice at least 30 days, certified mail, and return receipt. If we were to adopt it, anyone who was delinquent after May 25, and after notifying them after 30 days, then we could initiate tax sales. This doesn’t preclude entering into written payment agreements with taxpayers who have become delinquent for any other reason.”

Chairwoman Patty McGrath said she’d had several discussions with Schwartz about the new policy before Schwartz drafted it.  “I had mentioned the 30 days because 30 days is the standard for something to happen when bills are late, whether it’s interest, penalties, or repossession,” she said.

Schwartz said she would be willing to work with the affected property owners.

“If the Board were to approve this policy,” she said, “my first step would be to reach out to everyone who’s delinquent to see if they want to get into a tax plan. I’m not trying to be draconian here, but the town establishes a budget based on the voters’ vote, and their commitment to pay those taxes, and we’re dependent on that.”

McGrath agreed  that uncollected taxes are a burden on the town. “They literally cost us money, because we’re paying the school portion on that property,” she said. “That bites into the budget quite a bit.”

McGrath explained the process, checking for understanding: “If a building goes up for tax sale and is sold for $50,000, but $4,000 was owed on taxes, then we get to take the $4,000, our taxes, and the remaining $46,000 goes into escrow.”

“I think the whole amount is held in escrow for a year,” Schwartz corrected.

“So we don’t even get the taxes out of it?” asked McGrath.

“Not until the year is up, or the owner has had a chance to redeem it, or it’s been sold,” Schwartz replied. “Because the owner can come back in and say, ‘I’ll pay the taxes,’ and be able to reclaim the property.”

After some amendments to improve clarity, the Board unanimously adopted the new policy.

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