HB0666 94TH GENERAL ASSEMBLY

LRB094 03419 BDD 33421 b

94TH GENERAL ASSEMBLY
State of Illinois
2005 and 2006
HB0666

Introduced 1/28/2005, by Rep. Calvin L. Giles

SYNOPSIS AS INTRODUCED:

35 ILCS 200/21-250
35 ILCS 200/21-251
35 ILCS 200/21-253 new
35 ILCS 200/21-260

Amends the Property Tax Code. Provides that certificates of purchase from a scavenger sale in counties of 3,000,000 or more inhabitants must be registered. Increases the automation fee for assignments of certificates of purchase in counties with 3,000,000 or more inhabitants from $10 to $50. Sets forth procedures for the assignment or transfer of scavenger sale certificates of purchase. Increases the minimum bid at a sale to $500 (now, $250) or one-half of the tax if the total liability is less than $1,000 (now, $500). Provides that the changes made by this amendatory Act apply only to certificates of purchase that are purchased after the effective date of this amendatory Act. Effective immediately.

FISCAL NOTE ACT MAY APPLY

HOUSING AFFORDABILITY IMPACT NOTE ACT MAY APPLY

A BILL FOR

AN ACT concerning revenue.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 5. The Property Tax Code is amended by changing Sections 21-250, 21-251, and 21-260 and by adding Section 21-253 as follows:

(35 ILCS 200/21-250)

Sec. 21-250. Certificate of purchase. The county clerk shall make out and deliver to the purchaser of any property sold under Section 21-205, a certificate of purchase countersigned by the collector, describing the property sold, the date of sale, the amount of taxes, special assessments, interest and cost for which they were sold and that payment of the sale price has been made. If any person becomes the purchaser of more than one property owned by one party or person, the purchaser may have the whole or one or more of them included in one certificate, but separate certificates shall be issued in all other cases. A certificate of purchase shall be assignable by endorsement, provided that any assignment of a certificate of purchase from a scavenger sale must be made in accordance with Sections 21-251 and 21-253. An assignment shall vest in the assignee or his or her legal representatives, all the right and title of the original purchaser. The changes made by this amendatory Act of the 94th General Assembly apply only to certificates originally purchased after the effective date of this amendatory Act of the 94th General Assembly.

If the tax certificate is lost or destroyed, the county clerk shall issue a duplicate certificate upon written request and a sworn affidavit by the tax sale purchaser, or his or her assignee, that the tax certificate is lost or destroyed. The county clerk shall cause a notation to be made in the tax sale and judgment book that a duplicate certificate has been issued, and redemption payments shall be made only to the holder of the duplicate certificate.

(Source: P.A. 88-455; 89-617, eff. 9-1-96.)

(35 ILCS 200/21-251)

Sec. 21-251. Registry of owners of certificates of purchase.

(a) The county clerk of each county shall create and maintain a registry system that permanently records the names, addresses, and telephone numbers of owners or assignees of certificates of purchase issued pursuant to any tax sale conducted under this Code. The registry may consist of a single record or a combination of records maintained in paper or electronic form and may include copies of records kept by the county treasurer for other purposes, all to be used as the county clerk deems appropriate to carry out the purposes of this Section. The information in the registry shall be made available to the public.

(b) The county clerk of each county is authorized to promulgate reasonable rules, procedures, and forms for purposes of creating and maintaining the registry and for access to the registry information by members of the public. In counties with 3,000,000 or more inhabitants, any owner of a certificate of purchase pursuant to assignment may elect whether to register that assignment as provided in this Section, but all owners of certificates of purchase shall be subject to the provisions of subsection (d) of this Section. The registration of assignments of certificates of purchase from a scavenger sale in counties of 3,000,000 or more inhabitants is mandatory, and any attempted assignment without registration as provided in this Section is null and void. In counties with less than 3,000,000 inhabitants, the county clerk shall provide by rule whether registration of assignments of certificates of purchase shall be elective or mandatory.

(c) The owner of a certificate of purchase pursuant to assignment, in order to register that assignment, shall submit to the county clerk the owner's name, address, and telephone number in accordance with any rules, procedures, and forms promulgated by the clerk. Any registered owner of a certificate of purchase may update the registration at any time without charge by submitting to the county clerk any lawful change of name, address, or telephone number.

(d) If notice is required to be given to the owner of the certificate of purchase in any proceeding, whether judicial or administrative, affecting a tax sale conducted under any provision of this Code, the notice may be directed to the most recent owner of the certificate of purchase appearing in the county clerk's registry under this Section. Any notice that has been directed as provided in this Section shall be conclusively presumed to be properly directed to the owner of the certificate of purchase for all purposes related to the proceeding in which the notice is given. No objection or assertion by any assignee of a certificate of purchase in any proceeding shall be heard on grounds that a notice to the tax purchaser was misdirected, unless that assignee's current and lawful name, address, and telephone number were submitted to the county clerk's registry at the time of the notice in question.

(e) The county clerk may assess an automation fee of no more than $50 in counties of 3,000,000 or more inhabitants and no more than $10 in all other counties to be paid by the owner of the certificate of purchase for each assignment of the certificate that is registered under this Section, unless the owner of the certificate is a governmental unit. The fee shall be collected in the same manner as other fees and costs and shall be held by the county clerk in a fund for purposes of automating his or her office. The fee provided for under this Section shall not be chargeable to the cost of redemption under Section 21-355 nor shall it be posted under Section 21-360 of this Code.

(f) The changes made by this amendatory Act of the 94th General Assembly apply only to certificates originally purchased after the effective date of this amendatory Act of the 94th General Assembly.

(Source: P.A. 92-729, eff. 7-25-02.)

(35 ILCS 200/21-253 new)

Sec. 21-253. Assignment or transfer of scavenger sale certificates of purchase.

(a) No owner of a certificate of purchase from a scavenger sale may assign, convey, or otherwise transfer an ownership or other interest in the certificate to any other person except as provided in this Section, unless the assignment, conveyance, or transfer is made:

(1) by or to a governmental unit;

(2) to secure a debt or other obligation or to release the certificate from securing a debt or other obligation;

(3) pursuant to a merger, consolidation, or transfer or sale of substantially all of the assets of a corporation under plans of reorganization under the federal Internal Revenue Code of 1986 or the federal Bankruptcy Code;

(4) by a subsidiary corporation to its parent corporation for no consideration other than the cancellation or surrender of the subsidiary's stock; or

(5) in connection with the procedures provided by law for redemption or obtaining a tax deed.

(b) If the successful bid at the scavenger sale was less than the full amount of the delinquent tax principal included within the judgement and order of sale, then (except as otherwise provided in subsection (a) of this Section and unless the certificate is for an owner-occupied single family residential unit that is a condominium unit, cooperative unit, or dwelling) the certificate of purchase may be assigned only as provided as follows:

(1) The owner of the certificate of purchase shall present the original certificate to the county clerk prior to any assignment and shall request a statement of the difference between the successful bid at the scavenger sale and the full amount of the delinquent tax principal included within the judgement and order of sale. The owner of the certificate shall pay the difference to the county collector pursuant to the county clerk's statement, and the collector shall issue a receipt for the payment. The collector shall apportion the payment among the taxing districts in which the property is situated in accordance with law.

(2) Upon presentation of the original certificate of purchase and the collector's receipt for the payment under this subsection, the county clerk shall note on the certificate the extent to which the amount of the sale has been increased. The county clerk and the county collector shall also mark their scavenger sale records accordingly. Thereafter, the certificate may be assigned and the assignment registered, as provided in Sections 21-250 and 21-251, subject to compliance with subsection (d) of this Section, provided that the registration of the assignment is requested before the date that is 5 months prior to the expiration of the period of redemption or extended period of redemption from the sale.

(c) If the successful bid at the scavenger sale was equal to or more than the full amount of the delinquent tax principal included within the judgement and order of sale or if the certificate is for an owner-occupied single family residential unit that is a condominium unit, cooperative unit, or dwelling, then, except as otherwise provided in subsection (a) of this Section, the certificate of purchase may be assigned and the assignment registered, as provided in Sections 21-250 and 21-251, subject to compliance with subsection (d) of this Section, provided that the registration of the assignment is requested before the date that is 5 months prior to the expiration of the period of redemption or extended period of redemption from the sale.

(d) Any person (except a governmental unit) seeking to acquire an interest in a scavenger sale certificate of purchase under this Section is subject to the provisions of Sections 21-265, 21-275, 21-280, 21-285, and 21-290. No assignment shall be completed or registered unless the person who will be the owner of the certificate pursuant to the assignment has first executed and delivered to the county clerk a true and complete application for certificate of purchase in the form provided in Section 21-275.

(e) The county clerk may adopt reasonable rules, procedures, and forms for purposes of this Section. Nothing in this Section shall be construed to affect the rights and duties of persons redeeming from a scavenger sale, except that (i) the amount of the additional tax principal paid to the county collector to authorize an assignment of a certificate of purchase under subsection (b) is subject to the posting requirements under Section 21-360 and (ii) the cost of redemption under Section 21-355 includes the tax principal so paid and posted together with a 12% penalty on any year, or portion thereof, intervening between the date of payment to the county collector and the date of redemption.

(f) This Section applies only to certificates originally purchased after the effective date of this amendatory Act of the 94th General Assembly.

(35 ILCS 200/21-260)

Sec. 21-260. Collector's scavenger sale. Upon the county collector's application under Section 21-145, to be known as the Scavenger Sale Application, the Court shall enter judgment for the general taxes, special taxes, special assessments, interest, penalties and costs as are included in the advertisement and appear to be due thereon after allowing an opportunity to object and a hearing upon the objections as provided in Section 21-175, and order those properties sold by the County Collector at public sale to the highest bidder for cash, notwithstanding the bid may be less than the full amount of taxes, special taxes, special assessments, interest, penalties and costs for which judgment has been entered.

(a) Conducting the sale - Bidding. All properties shall be offered for sale in consecutive order as they appear in the delinquent list. The minimum bid for any property shall be $500 $250 or one-half of the tax if the total liability is less than $1,000 $500. The successful bidder shall immediately pay the amount of minimum bid to the County Collector in cash, by certified or cashier's check, by money order, or, if the successful bidder is a governmental unit, by a check issued by that governmental unit. If the bid exceeds the minimum bid, the successful bidder shall pay the balance of the bid to the county collector in cash, by certified or cashier's check, by money order, or, if the successful bidder is a governmental unit, by a check issued by that governmental unit by the close of the next business day. If the minimum bid is not paid at the time of sale or if the balance is not paid by the close of the next business day, then the sale is void and the minimum bid, if paid, is forfeited to the county general fund. In that event, the property shall be reoffered for sale within 30 days of the last offering of property in regular order. The collector shall make available to the public a list of all properties to be included in any reoffering due to the voiding of the original sale. The collector is not required to serve or publish any other notice of the reoffering of those properties. In the event that any of the properties are not sold upon reoffering, or are sold for less than the amount of the original voided sale, the original bidder who failed to pay the bid amount shall remain liable for the unpaid balance of the bid in an action under Section 21-240. Liability shall not be reduced where the bidder upon reoffering also fails to pay the bid amount, and in that event both bidders shall remain liable for the unpaid balance of their respective bids. A sale of properties under this Section shall not be final until confirmed by the court.

(b) Confirmation of sales. The county collector shall file his or her report of sale in the court within 30 days of the date of sale of each property. No notice of the county collector's application to confirm the sales shall be required except as prescribed by rule of the court. Upon confirmation, except in cases where the sale becomes void under Section 22-85, or in cases where the order of confirmation is vacated by the court, a sale under this Section shall extinguish the in rem lien of the general taxes, special taxes and special assessments for which judgment has been entered and a redemption shall not revive the lien. Confirmation of the sale shall in no event affect the owner's personal liability to pay the taxes, interest and penalties as provided in this Code or prevent institution of a proceeding under Section 21-440 to collect any amount that may remain due after the sale.

(c) Issuance of tax sale certificates. Upon confirmation of the sale the County Clerk and the County Collector shall issue to the purchaser a certificate of purchase in the form prescribed by Section 21-250 as near as may be. A certificate of purchase shall not be issued to any person who is ineligible to bid at the sale or to receive a certificate of purchase under Section 21-265. The certificate of purchase and the interest of the purchaser that it represents are subject to Sections 21-251 and 21-253.

(d) Scavenger Tax Judgment, Sale and Redemption Record - Sale of parcels not sold. The county collector shall prepare a Scavenger Tax Judgment, Sale and Redemption Record. The county clerk shall write or stamp on the scavenger tax judgment, sale, forfeiture and redemption record opposite the description of any property offered for sale and not sold, or not confirmed for any reason, the words "offered but not sold". The properties which are offered for sale under this Section and not sold or not confirmed shall be offered for sale annually thereafter in the manner provided in this Section until sold, except in the case of mineral rights, which after 10 consecutive years of being offered for sale under this Section and not sold or confirmed shall no longer be required to be offered for sale. At any time between annual sales the County Collector may advertise for sale any properties subject to sale under judgments for sale previously entered under this Section and not executed for any reason. The advertisement and sale shall be regulated by the provisions of this Code as far as applicable.

(e) Proceeding to tax deed. The owner of the certificate of purchase shall give notice as required by Sections 22-5 through 22-30, and may extend the period of redemption as provided by Section 21-385. At any time within 5 months prior to expiration of the period of redemption from a sale under this Code, the owner of a certificate of purchase may file a petition and may obtain a tax deed under Sections 22-30 through 22-55. All proceedings for the issuance of a tax deed and all tax deeds for properties sold under this Section shall be subject to Sections 22-30 through 22-55. Deeds issued under this Section are subject to Section 22-70. This Section shall be liberally construed so that the deeds provided for in this Section convey merchantable title.

(f) Redemptions from scavenger sales. Redemptions may be made from sales under this Section in the same manner and upon the same terms and conditions as redemptions from sales made under the County Collector's annual application for judgment and order of sale, except that in lieu of penalty the person redeeming shall pay interest as follows if the sale occurs before September 9, 1993:

(1) If redeemed within the first 2 months from the date of the sale, 3% per month or portion thereof upon the amount for which the property was sold;

(2) If redeemed between 2 and 6 months from the date of the sale, 12% of the amount for which the property was sold;

(3) If redeemed between 6 and 12 months from the date of the sale, 24% of the amount for which the property was sold;

(4) If redeemed between 12 and 18 months from the date of the sale, 36% of the amount for which the property was sold;

(5) If redeemed between 18 and 24 months from the date of the sale, 48% of the amount for which the property was sold;

(6) If redeemed after 24 months from the date of sale, the 48% herein provided together with interest at 6% per year thereafter.

If the sale occurs on or after September 9, 1993, the person redeeming shall pay interest on that part of the amount for which the property was sold equal to or less than the full amount of delinquent taxes, special assessments, penalties, interest, and costs, included in the judgment and order of sale as follows:

(1) If redeemed within the first 2 months from the date of the sale, 3% per month upon the amount of taxes, special assessments, penalties, interest, and costs due for each of the first 2 months, or fraction thereof.

(2) If redeemed at any time between 2 and 6 months from the date of the sale, 12% of the amount of taxes, special assessments, penalties, interest, and costs due.

(3) If redeemed at any time between 6 and 12 months from the date of the sale, 24% of the amount of taxes, special assessments, penalties, interest, and costs due.

(4) If redeemed at any time between 12 and 18 months from the date of the sale, 36% of the amount of taxes, special assessments, penalties, interest, and costs due.

(5) If redeemed at any time between 18 and 24 months from the date of the sale, 48% of the amount of taxes, special assessments, penalties, interest, and costs due.

(6) If redeemed after 24 months from the date of sale, the 48% provided for the 24 months together with interest at 6% per annum thereafter on the amount of taxes, special assessments, penalties, interest, and costs due.

The person redeeming shall not be required to pay any interest on any part of the amount for which the property was sold that exceeds the full amount of delinquent taxes, special assessments, penalties, interest, and costs included in the judgment and order of sale.

Notwithstanding any other provision of this Section, except for owner-occupied single family residential units which are condominium units, cooperative units or dwellings, the amount required to be paid for redemption shall also include an amount equal to all delinquent taxes on the property which taxes were delinquent at the time of sale. The delinquent taxes shall be apportioned by the county collector among the taxing districts in which the property is situated in accordance with law. In the event that all moneys received from any sale held under this Section exceed an amount equal to all delinquent taxes on the property sold, which taxes were delinquent at the time of sale, together with all publication and other costs associated with the sale, then, upon redemption, the County Collector and the County Clerk shall apply the excess amount to the cost of redemption.

(g) Bidding by county or other taxing districts. Any taxing district may bid at a scavenger sale. The county board of the county in which properties offered for sale under this Section are located may bid as trustee for all taxing districts having an interest in the taxes for the nonpayment of which the parcels are offered. The County shall apply on the bid the unpaid taxes due upon the property and no cash need be paid. The County or other taxing district acquiring a tax sale certificate shall take all steps necessary to acquire title to the property and may manage and operate the property so acquired.

When a county, or other taxing district within the county, is a petitioner for a tax deed, no filing fee shall be required on the petition. The county as a tax creditor and as trustee for other tax creditors, or other taxing district within the county shall not be required to allege and prove that all taxes and special assessments which become due and payable after the sale to the county have been paid. The county shall not be required to pay the subsequently accruing taxes or special assessments at any time. Upon the written request of the county board or its designee, the county collector shall not offer the property for sale at any tax sale subsequent to the sale of the property to the county under this Section. The lien of taxes and special assessments which become due and payable after a sale to a county shall merge in the fee title of the county, or other taxing district, on the issuance of a deed. The County may sell the properties so acquired, or the certificate of purchase thereto, and the proceeds of the sale shall be distributed to the taxing districts in proportion to their respective interests therein. The presiding officer of the county board, with the advice and consent of the County Board, may appoint some officer or person to attend scavenger sales and bid on its behalf.

(h) Miscellaneous provisions. In the event that the tract of land or lot sold at any such sale is not redeemed within the time permitted by law and a tax deed is issued, all moneys that may be received from the sale of properties in excess of the delinquent taxes, together with all publication and other costs associated with the sale, shall, upon petition of any interested party to the court that issued the tax deed, be distributed by the County Collector pursuant to order of the court among the persons having legal or equitable interests in the property according to the fair value of their interests in the tract or lot. Section 21-415 does not apply to properties sold under this Section. Appeals may be taken from the orders and judgments entered under this Section as in other civil cases. The remedy herein provided is in addition to other remedies for the collection of delinquent taxes.

(Source: P.A. 90-514, eff. 8-22-97; 90-655, eff. 7-30-98; 91-189, eff. 1-1-00.)

Section 99. Effective date. This Act takes effect upon becoming law.