Baltimore establishes tax sale work group, purchases 454 liens

In an effort to protect legacy homeowners in Baltimore, the city is establishing a work group to develop long-term solutions to the city’s tax lien certificate sale process, Baltimore Mayor Brandon Scott announced Thursday.  

Scott also said that the city will purchase 454 liens on owner-occupied homes that were sold in the 2021 auction, effectively satisfying those liens and removing the properties from the tax sale process. A combination of Baltimore city general funds and federal grants will be used for the purchase. 

The work group will be chaired by Deputy City Administrator Daniel Ramos and Dan Ellis, executive director of Neighborhood Housing Services, and its members will include advocates, lawyers, tax sale experts and representatives from the city government. The group is slated to begin meeting this fall. 

“The process will identify the current gaps in the system, advise on things like technological upgrades that will allow residents to sign up for payment plans on their liens, and work with our state legislators to get Baltimore city more local authority over the entire process, something we currently lack,” Scott said on Thursday. 

The current tax sale process involves putting residential and commercial liens up for an annual auction, where investors can purchase them. The sale, which last year brought in $18.8 million in Baltimore, has faced scrutiny for targeting occupied residential properties.  

This scrutiny increased amid the coronavirus pandemic, as homeowners struggled to pay their taxes due to job losses, according to reporting in the Baltimore Sun. 

During the press conference, Ellis called the tax sale system “one of the most unjust systems that (he has) ever encountered” while working in Baltimore and expressed his gratitude to Scott for working to address the issue. 

“I am grateful to the mayor for his willingness to … create a work group that can work creatively to find solutions that work both for the city, generating the needed revenue, and for the residents, ensuring that they are protected from high-cost, predatory practices,” he said. 

The mayor said the move to purchase the tax liens is an “interim action” to protect city homeowners while the work group looks for longer-term solutions.  

“This will … allow those homeowners to start fresh with a clean slate,” Scott said. “We have to work together to prioritize equity and this is why I’m taking these steps to provide relief to homeowners now while committing to do the tough, long-term work that has to be done.” 

These actions follow Scott’s announcement in May of this year that first-time owner-occupied properties would not be included in the tax sale taking place later that month. It was his administration’s first action in the effort to reform the tax sale system.

A law, signed by former Mayor Jack Young, also went into effect in July that prevents vulnerable residents, including seniors, low-income residents and people with disabilities from losing their homes to the tax sale.