How to Send a Drug House to Sheriff's Sale
By Lisa Parsley Wednesday, 03/12/03 (1047491796919)
Is there a drug house in your neighborhood? A whorehouse? A nuisance bar or "after hours" club? Chances are excellent that they are delinquent in the property tax and that with a little persistence you can get City Hall to sell the problem property to responsible, law abiding citizens.
In order to send a nuisance house to Sheriff's sale you will need:
1. $750-$800 refundable deposit which you usually get back at the end of the process
2. 3-12 months for the legal process to play out
3. A few pieces of public information readily available either on Hallwatch or from City government.
If a drug dealer or real estate speculator holds onto their property while continuing to not pay taxes, at a certain point the property becomes eligible for Sheriff's sale. This means the City can force the sale of the property in order to collect the back taxes. The City almost never does so.
Here's how you can force the City do its job. By doing so, you will:
1. Help clear your neighborhood of drug and other nuisance houses.
2. Send a message to City officials that you expect them to levy taxes fairly and efficiently so that law abiding citizens don't end up paying for tax deadbeats.
3. Provide our City's schools and libraries with badly needed funds.
Steps to Send a Drug House to Sheriff's Sale
1. Look up the drug house on Hallwatch.
Go to Hallwatch.org and enter the address of the property in the searchable database under "Real Estate & Property Tax," clicking on "Property by Address." Or just click here. Write down the BRT number, also known as a parcel number. Now click on the property's "history" tab at the top of the page and write down how much the property owes in delinquent real estate taxes.
2. Does the drug house owe more than $1500 in property taxes?
If this account owes over $1500 in property tax to the City of Philadelphia, the property is eligible for Sheriff sale.
3. Find out who holds the lien, the City or a private collection agency.
Using the parcel number you found on Hallwatch, call the automated phone line of the Real Estate Tax Unit of the Department of Revenue (RETU), 215-686-6442. You can call at any time. Key in the parcel number on your phone pad, and the telephone system will tell you whether or not the lien is held by the City or by a private collection agency.
1. City
If the taxes are over $1500 and the recording does not mention PAID, then the City holds the lien.
2. Private Collection Agency
If the phone line says the lien was sold to PAID, it is held by a private collection agency. Write down the phone number of the private collection agency.
PAID stands for the Philadelphia Authority for Industrial Development. It does not mean the bill was paid.
The main private collection agency is Texas law firm Linebarger Goggan. Most of the other private collection agencies are out of business, and their liens were purchased by Linebarger Goggan. It is safe to assume that if the recording lists another agency besides Linebarger Goggan, you will still end up referred to Linebarger Goggan.
4. Put down your refundable deposit of $750 or $800
1. City
Go to the Real Estate Tax Unit in the Municipal Building at 1401 JFK Boulevard, in the basement. This is the building with the Frank Rizzo statue, north of City Hall. You need to set aside $800.
Webmaster's note: according to Jim McElvaney, head of the Real Estate Tax Unit, the Department accepts escrow deposits in the form of bank check, cashier's check or money order.
Your escrow deposit must accompany your request. This says to the City that you are confident that there will be a buyer. It is very unlikely, even impossible, in this market that there will be no buyer. If there is no buyer, your deposit is refunded, however.
Webmaster's note: The Revenue Department confirms that the deposit will be refunded in all cases.
Next, this escrow (refundable) deposit is placed with the Real Estate Tax Unit in the basement of the Municipal Building. This is the same place where the Phila. Water Department is, and Licenses and Inspections, 1401 JFK Blvd.
2. Private Collection Agency
If the lien is held by Linebarger Goggan, set aside $750. Next, you will go to:
Linebarger Goggan Goggan Blair & Sampson
123 South Broad Street, Suite 1812
Phila., PA 19109-1089
Their phone is 215-790-1117
8:30 am -5pm M-F
Linebarger Goggan takes only a certified check or money order for $750 as an escrow deposit on your request. Joseph Meade will handle your request.
Linebarger Goggan is much more sympathetic and professional than the City. Some employees of the City will treat you badly, feeling that it is their duty to prevent houses from going to Sheriff's sale. I hope the next administration will outsource the functions of the Department of Revenue, the BRT, and the Sheriff's office. Then these agencies could be readily audited and professionally held accountable from top to bottom.
5. Wait 3-12 months
It takes between three to twelve months for the City Law Department to take care of probate and for the house make it to auction. Linebarger Goggan is faster than the City. Either way, it is worth the wait. The Sheriff added one day a month to expedite the backlog, which is no great shakes. There is so much eligible property in Philly that they could have an auction every day and not sell the backlog for years.
6. The Nuisance House Clears Out Like Magic!
In my experience, the nuisance house clears out when they get their notice that the house is going up for auction, and that the Sheriff is coming to evict them. Typically, they move out 15 to 30 days before the date of the auction. It is magical. Like waving a wand over crime, and saying, "Poof!" It is better than police, better than Human Relations, and better than going to jail for shooting them and dumping their useless carcasses in either river.
Webmaster's note: Parsley presents what is probably a best case scenario. Your mileage may vary. According to one source, in some cases it may be necessary to go through formal eviction proceedings to empty a drug house.
7. Go to the Auction
After you get notified by mail, one of the benefits of requesting a nuisance property yourself, you attend the scheduled date of auction. This will allow you to find out the name the buyer of property which you may need in order to get your deposit back. Real Estate Tax Lien foreclosures are held at the First District Plaza, 3801 Market St., Phila., PA 19104. Call the Sheriff's Office Real Estate Department at 215-686-3530 to confirm the sale.
Frequently Asked Questions
Q. Should I Use My Own Name, Phone, and Address on the Request?
A. If the house you are sending is occupied by nasty people, don't risk using your own name during your request. Use a cell phone number and the name and address of an out of state friend or relative. The receptionist at the RETU desk will often ask your name. She does not need this information for any legitimate reason. Give a fake name. You will be directed to meet with Mr. X, who is helpful and efficient and who does not care what your name is.
Webmaster's note: RETU head Jim McElvaney suggests that it is unfair to refer people to Mr. X when he is only one employee of several in the Judicial Sales Division of the RETU. Other employees should be able to help you with your request, too.
Don't be surprised if your neighborhood finds out about the sale. An informal network of employees in the Department of Revenue and Sheriff's office will often leak information on houses requested to go to Sheriff's sale to friends and neighbors. Aren't you glad you used a fake name? The grapevine can broadcast this info, but the only way to stop the Sheriff's sale at this point, according to RETU, is for the owner to pay the taxes in full.
Q. What is a lien? An escrow deposit?
A. Whenever you hear the phrase "escrow deposit," just think "refundable deposit." Whenever you hear the word "lien," just think, "debt paid by seller."
Liens, which literally mean "to hold," must be settled at the time of sale. Liens are a debt against the previous owner or seller that come out of the sale price of the property. The previous owner gets less as a result. The seller pays the lien, not the buyer. This is a common misunderstanding. Don't let it deter you from sending a nuisance property to auction. Don't let anyone mislead you, either. Sometimes City employees are not reliable sources of info.
Q. What can I do about abusive, unprofessional or unhelpful City employees?
A. If City employees become abusive, calmly get their name, ask to speak to the supervisor, and report the incident to the Office of the Inspector General of the City of Philadelphia. This is unheard of in private industry and professional city governments. Don't tolerate it. Follow up.
Webmaster's note: while I sympathize with Parsley, reporting rude or unhelpful employees to the Inspector General seems like overkill. I'd suggest asking to speak with the employee's supervisor instead. If this doesn't work or you need time to think things over before making an official complaint, the person responsible for the overall operation of the Revenue Department, including its Real Estate unit, is Commissioner Nancy Kammerdeiner. Her number is 215.686.6400.
Q. Can't I Just Wait for the City to Do Its Job?
A. The City may never, I repeat, may never collect this tax unless someone steps forward with an escrow deposit. I have seen properties that owe over $30,000.00 in property tax to the City. This represents decades of nonpayment in areas where the taxes are or were low. There are whole blocks that owe over $100,000 to $250,000 in unpaid property tax. Yet there are properties that go up for auction for overdue taxes of three or four thousand. How can this be?
Long overdue deadbeats seem to be individuals or organizations capable of either making contributions or delivering blocks of votes. Church real estate ventures. Bars. Whorehouses. Businesses in the City that could bad mouth a candidate to a large clientele.
Q. I was short of money last year, so I didn't pay my property tax. Will my house be sold at Sheriff's sale?
A. Not unless you live in Chestnut Hill. A property is only eligible for Sheriff's sale if more than $1500 in back taxes are owed. If your house is assessed at less than $57,000, one year's delinquency will not put you over the limit.
Q. What if the Nuisance Property is on an NTI list?
A. If your nuisance property is on someone's Neighborhood Transformation Initiative or NTI list (a request for condemnation and transfer of title), never fear. It takes about three years to get through the NTI proceedings, and only as long as 12 months for an auction request. If the auction occurs, the City can't very well give the property to away, can it? Private property rights trump bad government.
Q. Won't the drug dealer pay in full?
A. Almost never. It is too expensive to pay the taxes, even if they appear low, for someone who is looking to live for free or in a low rent situation. Because the City virtually never collects property taxes without an escrow deposit, this makes property tax payment in the City virtually optional. Sometimes, people inherit grandma's house without any intention of putting money into it. It is cheaper just to find another house like grandma's and move there than to pay grandma's tax bill. Ditto with gas and water bills. Until Philly changes its philosophy of optional payment collection for gas, water, and property tax, it will continue to be a haven for the illegal classes.
Q. Won't the drug dealer kill me?
A. No. You don't use your own name verbally or on paper. The City doesn't know who you are. Say nothing to the drug dealer or nuisance owner under any circumstances.
Q. Can I send more than one house at a time?
A. You bet.
Q. What happens if the property is stayed?
A. Properties can be stayed, but only if the property tax is paid in full. With nuisance properties, this is rarely the case. Criminal families think the City is so corrupt, they don't want any part of it.
Q. Can the owner or presumed owner buy the property back within one year after it is sold?
A. This is one aspect of the Sheriff's sale this is poorly understood. In order for the property to be bought back within a year, the owner must pay:
1. All the taxes in full
2. The price the house fetched at Sheriff's sale
3. The cost of any improvements
4. The City's fees in sending the house to auction
Q. Can the previous owner take the house back simply by paying off the back taxes after the Sheriff's sale?
A. Yes, but this is not likely. If someone didn't have enough money to prevent an auction in the first place, where will they get the far greater sum necessary to buy the place back?
The law gives owners who actually live in their house one year to redeem their property by paying off the back taxes and other costs. If they do this, they get their house back. City Council should change this law. [Webmaster's note: Parsely is incorrect here. The one year right of redemption comes from state law. As such Philadelphia City Council cannot change it.] The Sheriff's Sale process is intended to keep properties on the tax rolls and in the hands of responsible owners, not throw defenseless widows into the street. Most deadbeats have plenty of money but choose not to pay their taxes safe in the knowledge that the City will never foreclose on their property.
Q. Doesn't sending a nuisance property to auction increase homelessness?
A. If someone inherits a house, pays no rent, no mortgage, and can't pony up the property tax, my experience is that they are not poor as much as they are scampers. Any house I ever sent to auction was owned by someone who made a good living and even owned several properties, or had been owned by someone who died without a will, whose family is too trifling to pay property taxes even though they live rent and mortgage free. In one case, it would have amounted to about $50 a person per year.
People who can't manage the demands of homeownership are better off in the rental system. If they are eligible for housing subsidies, then they have the option to apply and wait. But too often in Philly, the nuisance house is not owned by a responsible person. If the City allows the house to fail to pay taxes, we end up paying more property tax to offset this loss. It's a system of unaccountability that we can no longer afford.
Sending blighted houses to auction avoids the most of the need for NTI and other expensive clean up programs, brings in a tax-paying owner who tends the property, and shunts any people who won't pay taxes into the rental market. It also decreases costs of sanitation and cleaning and sealing by L&I, rat control, fire, police, and you name it. Try to think of one tax-funded service that a nuisance house doesn't use. One nuisance house I was involved with had at least one 911 call every week for over a year. That's pricey.
If you have questions about the Tax Lien auction, go to
Philadelphia Sheriff's Office and read the fine print. Or, email me at
ljlong@earthlink.net and let me know how your proceedings are going. I would love to hear that you sent a nuisance house to auction.
Lisa Parsley is a community activist from Southwest Center City. She co-managed the Ikea letter writing campaign and has been involved in the recent effort to save the Naval Home.
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