Water bill revisited


Council looks at measure to prevent home sales for unpaid liens

March 27, 2007|By Fred Schulte and June Arney | Baltimore Sun reporters

Two-thirds of Baltimore's City Council agreed last night to sponsor hastily resurrected legislation to prevent homeowners from losing their homes over unpaid water bills, all but assuring its swift passage.

City officials, meanwhile, mulled the feasibility of an amnesty program.Bernard C. "Jack" Young, 12th District councilman, yesterday reintroduced his proposal from 2005 to stop the city from including water-bill debts in its annual sale of liens over back taxes. The bill was withdrawn late last year after administration officials argued that many people would quit paying their water bills without the threat of foreclosure.

"A lot of people are still calling me and saying their water bill is the cause of them losing their home in tax sale," Young said in an interview yesterday. "I don't think a water bill should trigger that. Let's cut their water off. We've got to come up with a better system than what we have."

A hearing on the bill is set for April 11.

The council's move followed an investigation published Sunday in The Sun which found that about 400 city homes have been lost over debts other than property taxes in the past three years. Most stemmed from unpaid water and sewer bills, but some also included alley repaving and sidewalk repair charges, fees to register rental property and business licenses.

About half involved unpaid charges of $500 or less.

Young said it would take several months - at best - before a bill could be adopted. That left it unclear whether Young's bill, or anything else being discussed, could alter the course of Baltimore's next tax sale planned for May 14.

Young said he supports Mayor Sheila Dixon's idea of offering amnesty for delinquent water bills, just as the city offered on unpaid parking tickets three years ago.

Dixon said in an interview last week she was surprised by the number of homeowners losing property over small bills.

"As soon as you [Sun reporters] left her office, she put word out to her intergovernmental affairs office to look at the feasibility of an amnesty program for water bills," said Anthony McCarthy, a spokesman for the mayor. "The conversation has certainly begun. She doesn't want to see anyone lose their property over a water bill."

State lawmakers also reacted strongly yesterday to the water-bill disclosures and called for more study of existing laws regarding tax sales, which take place throughout the state.

Several joined critics who compared tax sales over water bills to ground rent ejectments, in which hundreds of city residents have had their homes seized by investors for failing to make rent payments of as little as $24 on the land beneath their houses.

The General Assembly is overhauling the ground-rent system in response to a series of articles in The Sun last year.

"Property rules should not be designed to trap the unwary or the unlucky," Sen. Jamie Raskin, a Montgomery County Democrat, said yesterday. "Society's interest is in people having real security in their homes and in neighborhoods having continuity and stability. We shouldn't confuse the real world with a Monopoly game."

Brian E. Frosh, chairman of the Senate Judicial Proceedings Committee, said his group already is slated to study the broad topic of foreclosure during the summer.

"Tax sales are a problem," said the Montgomery County Democrat. "Foreclosure is troubled as well. Maybe we should be looking at all these accelerated remedies."

Lawmakers don't have enough time to propose legislative fixes with just two weeks left in the current session, said Del. Samuel I. Rosenberg. But the Baltimore Democrat predicted that the legislature would take up the issue next year.

Investors who buy liens in tax sales can take a homeowner to court if the taxes or fees aren't paid within six months after the sale. Legal fees in those lawsuits have soared since the General Assembly in 2003 removed a $400 cap and permitted lawyers to charge "reasonable fees," subject to court approval, once a case gets to court.

Several county tax collectors said in interviews that they are troubled by rising fees.

"More and more of us are seeing exorbitant fees to get the property back. It's a concern of ours," said Cathie Moore, deputy treasurer for Caroline County.

Some city officials have expressed concern as well. However, Kyriakos Marudas, assistant city solicitor, said Sen. George W. Della Jr.'s proposal to bring back the $400 cap is too severe. He recommended that it be raised to $1,100 to cover costs of processing court filings, legal notices and other paperwork.

City Councilwoman Mary Pat Clarke, of the 14th District, said she is drafting a bill to keep liens of under $1,000 out of tax sales. The city would work out payment plans directly with the homeowner.

"I have dealt with many a tax sale crisis," she said. "I was amazed at how many houses went to tax sale with such a low amount of taxes owed. And I don't think that water bills, alley pavings and all these other things belong in tax sale."

Frosh said that tax sales differ from other foreclosures and ground rent ejectments in that government sets the process in motion.

"If a bank or a mortgage holder is following the law, that's really all they have to do," Frosh said. " ... I think the government has more of a responsibility to ensure that their citizens are fully informed of their rights and obligations."

Sun reporter John Fritze contributed to this article.

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