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Michael Miller

Viewpoint

By Michael Miller
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Liens

Perhaps your home sits on land that was seized by the county for delinquent property tax payments.

The Great Depression had hit at full force by 1931, and local governments were faced with a growing problem of “dead properties” on which owners were deep in arrears or had stopped paying property taxes altogether. Budgets were out of wack and it was the county’s responsibility to somehow either collect past taxes or to get the properties back on the tax rolls (“liquidate the liens” in tax talk). An investor could purchase the lien, charge the property owner a 15 percent premium for a year and then take over the title if full back taxes weren’t paid.    

The county government and the Republican political organization were one thing, and when the wave hit, worried officials started to drag their feet. “We want to help the taxpayers, not injure them,” said the County Treasurer in announcing that the expected tax sales on 1932 delinquencies would not be held. The county couldn’t even place a precise value on troubled properties because of differences in how the five towns and cities assessed property. Nassau needed some kind of new, modern government that could deal with modern, messy problems. As the intense negotiations and machinations behind the creation of the Nassau County Charter ground along, the tax liens and the tension piled up.

When the county charter (our constitution) went into full effect on January 1, 1938, tax assessment was centralized into the new county government. Within weeks, the county began a massive project to resurvey, reassess and map every one of the 400,000 parcels of property in the county. They thought it would take about a year. They finished early. By late July, staff attorneys were already in court clearing land titles and that September, this newly-empowered Super County announced the biggest tax lien sale ever seen in the East.

Twenty thousand properties with an assessed value totaling $3.5 million ($54 million in today’s money) went “under the hammer” in old auction slang. It was different from any other tax sale held in New York. They cut years off the legal process. The county actively encouraged the former owners to pay the back taxes, and took properties off the block right up to the moment of bidding if a payment schedule could be negotiated. Twelve hundred payment contracts were negotiated and the county pulled in $1.5 million in back taxes this way. The county produced booklets describing each property, many with photographs. The booklets cost 50 cents, and 5,000 were mailed out. Over three weekend auction sessions held at Police Headquarters in Mineola, the county got back about one-fifth of the taxes owed, and put thousands of properties back on the tax roll.

This made a difference. The entire county budget for 1939 was $19.8 million.

They were very careful, that first year, to auction off mostly empty and unimproved lots, mostly from developers who walked away from failing housing projects. The next year, more single family homes were mixed in and a few country estates. The annual Nassau tax lien sale became a huge event, involving thousands of properties each year. In 1941, the auctions were moved to the new county courthouse, and arrangements were made with nearby property owners so that over 3,000 parked cars could be accommodated on any one of the 15 nightly sessions.

Paying very close attention to all of this were housing development and real estate firms. They closely monitored which types of homes were most in demand, and drew up plans. And they bid.

By 1942, the county had cleared its books of delinquent properties.

By the 1980s, when our county was less concerned with being “first” and “best,” this tax lien system had grown calcified and its loopholes were being exploited. One family lost its home because of a missed $34.98 county tax bill. Some improvements were made in 1986. Some.

Now we face another emergency, close enough to smell. Thousands of residents who own their homes outright may fall behind on tax bills. Humanitarian concerns aside, crisis sales drive down values and raise tax rates. We need a plan.

Michael Miller is a freelance writer, designer and strategic consultant who has worked in state and local government. Email: millercolumn@optimum.net