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Community groups cry foul over upcoming tax lien sale

At the 11th hour, several community and nonprofit groups and at least one city councilwoman are crying foul over the city’s upcoming tax lien sale. The city is scheduled to start selling 1,400 tax liens on Wednesday in an online auction.

At the 11th hour, several community and nonprofit groups and at least one city councilwoman are crying foul over the city's upcoming tax lien sale.

The city is scheduled to start selling 1,400 tax liens on Wednesday in an online auction, in which it hopes to bring in some money on its vast stock of tax delinquent and typically blighted properties.

The lien sale process would give private investors the ability to foreclose on those tax-delinquent properties and to place fees and interest on the liens in hopes of one day recouping the money.

But the Philadelphia Association of Community Development Corporations and the Public Interest Law Center, along with several other nonprofits, are saying that in just a small sample they did of the properties, they found some that are tax-exempt and other properties that are currently community gardens and would be better suited for the Philadelphia Land Bank.

Councilwoman Maria Quinones Sanchez, the driving force behind the creation of the city's Land Bank, raised similar concerns. She is asking that the sale be postponed.

"I believe that it is crucial for us to have more time to review any liens proposed for sale," Sanchez said in a letter addressed to Mayor Nutter Monday.

Nutter's spokesman Mark McDonald said the sale will go on as planned on Wednesday.

The administration will respond to the letters, he said.

"The revenue and finance folks are working with folks at the Land Bank to coordinate... if there are properties that the Land Bank sees as better use," McDonald said.

The Philadelphia Land Bank is supposed to streamline the vacant and tax delinquent property acquisition and sale process. Its intent is to be the holder of deeds for the thousands of properties owned by various city agencies and therefore be able to sell properties in bundles to people who will turn them around to productive use. (The land bank has been off to a slow and shaky start.)

"We fear that if the liens for those properties are sold to a private investor - either as individual parcels or part of a bulk sale - it is unlikely the investor will have substantially greater success than the City in collecting back taxes and penalties," a June 11 letter, signed by 17 groups, said. "Meanwhile, the City's hands are tied; because the lien has been sold, the City cannot seize the property for code violations nor tax delinquency while the investor is attempting to collect."

The Philadelphia Association of Community Development Corporations and the Public Interest Law Center sent another round of letters Monday again urging the administration to remove certain properties or postpone the sale.
McDonald said that any property owners who don't want their liens to be sold to private investors should contact the Revenue Department as soon as possible.

"The tax lien auction process allows property owners to pay off taxes owed or sign up for a payment agreement," McDonald said.

Council President Darrell L. Clarke previously said such sales could raise at least $30 million, which could be sent to the cash-strapped Philadelphia School District. But administration officials say it's unclear how much that sale, seen as a pilot program, would net.

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