Council OKs plan to sell tax liens

PHILADELPHIA City Council gave its stamp of approval Thursday to the idea of selling liens held against tax-delinquent properties to private investors and collection agencies.

In truth, the bill passed Thursday could wind up having no practical effect - the city already has the authority to sell its liens, and its Law Department opined last week that Council had no say in the matter.

Councilman Bill Green said he sponsored the bill in part to spur the Nutter administration to consider using this tax collection "tool" - which has its share of critics.

At a Council committee hearing this month, Revenue Commissioner Clarena I.W. Tolson was agreeable to the idea. She said she thought "including the private sector into the mix . . . enhances the collection process."

A recent study from the Pew Charitable Trusts pegged the amount of money owed to the city in back property taxes, interest, and penalties at more than $515 million. The study cautioned only about 30 percent of that was collectible.

By selling liens, the city would get money up front and turn collection of the debt over to private hands.

Council members Jannie L. Blackwell and Maria Quiñones Sánchez voted against the bill Thursday. Blackwell called the idea of selling liens, especially those held on owner-occupied homes, dangerous.

Sánchez is the prime sponsor of legislation to create a central land bank, which would be responsible for assembling vacant and tax-delinquent property for redevelopment.

Critics of lien sales argue that turning over numerous tax-delinquent properties to the private sector frustrates civic redevelopment efforts. The land-bank bill faces a committee hearing next week.

Green said his bill added consumer protections for homeowners and would help bring in taxes owed by out-of-town speculators.

"We need certainty of action for property owners to change the culture of nonpayment in this city," he said. "That culture change can result in a $60 [million] to $80 million increase in our annual take of real estate taxes."

In separate action Thursday, a Council panel heard testimony about kiosk machines that let people sell smartphones and other devices for cash. Councilwoman Blondell Reynolds Brown has proposed banning the ATM-like machines, saying they could spur phone thefts and robberies.

The committee gave the bill a preliminary OK, but Brown agreed to slow her legislation, form a task force, and further study the issue.

Two of the machines have been in Franklin Mills Mall since last year. Executives from the company that owns the machines, ecoATM of San Diego, were in town this week for a law enforcement convention.

Representatives showed off the kiosks, which take multiple photos of sellers and makes them provide valid ID and a thumbprint.

"Cellphone theft is bad for our business," Max Santiago of ecoATM testified Thursday. "We want to prevent it as much as the members of this City Council."

Company executives said they hold on to every phone for 30 days and hand over to police any discovered to be stolen, as well as the information collected on the seller.

Santiago said ecoATM's 17 area machines had netted more than 35,000 phones - of which 43 were flagged as possibly stolen.

Some Council members and other witnesses remained skeptical. "All of this is after the fact," said Maureen Rush, the University of Pennsylvania's chief of public safety. "We still had a crime occur."

She suggested seeking a way to delay paying the seller until the phone is determined to be clean.

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