"The attention and focus of the delinquent taxpayers as well as the interest of potential investors has been very encouraging."
Philadelphia, Pennsylvania (PRWEB) July 01, 2015
National Tax Lien Association lends support to Philadelphia in their pilot tax lien sale which produced nearly 44% collections compliance even before a single lien was sold. The City notified 4,091 delinquent taxpayers that their unpaid taxes would be sold to private investors. The results were astounding as 1,414 paid the tax delinquency or entered into a payment agreement.
The mere announcement of the sale produced incredible collections from this pool of liens that that had not paid in years. "This is very typical around the US in the 30 states that sell tax liens," commented Brad Westover, Executive Director of the National Tax Lien Association. "The process generally nets 30% to 50% collections before a single lien is sold."
In total, 240 tax liens were sold for $2,109,028. The monies generated from this pilot program will go to fund the budget shortfall for Philadelphia's public schools. The pilot program tested the City's records, the auction software of SRI, Inc. and the investor interest. "We are intrigued by the early results of this pilot project,” said Clarena Tolson, City of Philadelphia Revenue Commissioner. "The attention and focus of the delinquent taxpayers as well as the interest of potential investors has been very encouraging."
Increasingly, America's cities are filling their budgetary shortfalls through tax lien sales. Tax lien sales provide local governments with funds to pay for public schools, police-fire services, road construction and other municipal services. The risk of collection is transferred to the tax lien investor which frees up government staff to concentrate on current tax collections.
With the successful completion of this pilot sale, the City of Philadelphia could join Atlanta, Chicago, Cleveland, Denver, Hartford, Kansas City, Indianapolis, Miami, Nashville, New York City, Phoenix, and Washington DC to conduct annual tax lien sales.