In Baltimore, Some Owner-Occupied Homes Will Be Spared From Tax Sale

Baltimore
Baltimore City Hall. File photo.

Baltimore Mayor Brandon M. Scott (D) is removing some homes from the city’s annual tax sale later this month.

Owner-occupied homes that face a tax sale lien for the first time won’t go to the auction block, Scott said Monday.

The announcement means that some Baltimore homeowners who’ve taken a financial hit as a result of the COVID-19 pandemic won’t have their past-due property taxes and other charges sold to the highest bidder at the city’s May 17 tax sale, an online auction that the city uses to collect overdue bills.

During the auction, bidders pay for the various property liens owed to the city in exchange for a tax sale certificate, which “gives the bidder the right to obtain ownership of the property by filing a tax sale foreclosure lawsuit,” according to the city’s website. Property owners can reimburse the successful bidder for the liens and other charges paid during the tax sale — in addition to interest and other costs imposed by the lienholder — to avert a foreclosure, according to the website.

“Today’s announcement is about being targeted and strategic in our approach to protect our legacy homeowners and center equity,” Scott said in a release. “This is about taking the action we can take now, not simply kicking the can down the road, and working to address the underlying issues in this process to keep our most vulnerable residents housed.”

Councilwoman Odette Ramos (D), who has previously described tax sales as “predatory,” told Maryland Matters that the auctions have a disparate impact on low-income and elderly homeowners in Baltimore and across the state. She said the move is particularly timely amid the COVID-19 pandemic.

“We have a lot of people who really had a major COVID economic impact, so this was the right move,” Ramos said.

Ramos said the city still has a “long way to go” in terms of reforming the tax sale process, and said her ultimate goal is to put tax sale purchasers out of business. One reform effort, sponsored by Councilwoman Danielle McCray (D), will extend broader tax sale protections to certain homeowners, including “older adults, people receiving federal disability benefits and households with a combined income less than $40,000,” according to the release. That local legislation is set to take effect on July 1.

“We must continue to do everything in our power to protect our most vulnerable homeowners, including our seniors, low-income families, and people with disabilities,” McCray said in the release. “I thank the Mayor for taking this important first step to keeping Baltimore homeowners safe during this pandemic.”

Ramos said she’s seen a heightened “political will” to reform the tax sale process in Baltimore and across the state in recent years. She pointed to House Bill 852, passed by the General Assembly this year, which would create a Homeowner Protection Program to divert vulnerable homeowners from tax sales. The bill, sponsored by House Ways and Means Chairwoman Anne R. Kaiser (D-Montgomery), awaits action by Gov. Lawrence J. Hogan Jr. (R).

In 2019, Sen. Mary Washington (D-Baltimore City) sponsored a bill, now law, that stopped homes in the city from being sent to tax sale for overdue water bills.

Monday’s announcement came after weeks of advocacy by housing rights groups. The policy shift was made just after an April 30 deadline for homeowners to make payments to avoid being listed in the sale.

Residents with issues related to the tax sale can call 410-396-3556 for individualized support, the mayor said Monday.

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