Emergency tax sale reforms pass D.C. Council

September 17, 2013

Carmen Starks, 64, was erroneously charged $8.61 in interest on her property tax bill because of a delay at the D.C. tax office in processing her payment. The interest charge forced her into a court battle to save her home on V Street NW. (Michael S. Williamson / The Washington Post)

The D.C. Council voted overwhelmingly Tuesday afternoon to institute emergency reforms to the city’s process of auctioning property tax debts to private investors — a system that has seen abuses allowing homeowners to lose their properties over small tax debts.

Jack Evans (D-Ward 2) cited a recent Washington Post series on the system in spurring his bill, which sets a legal minimum of $2,000 for the tax debts offered at auction; freezes the sale of homes belonging to seniors, veterans and the disabled; and limits the fees that debt buyers may charge to $1,500.

The measure passed on a 12-to-0 vote, but Tommy Wells (D-Ward 6) abstained, explaining he was uncomfortable with the entire practice of auctioning homeowners’ tax debts to private parties. “Why do we even allow this practice?” he asked.

Evans said a broader look at the tax sale system will be part of the council’s deliberations on a permanent bill, which Evans introduced earlier Tuesday.

By a 13-to-0 vote, the council also endorsed an emergency measure from Mary M. Cheh (D-Ward 3) that ordered the city’s finance office to examine 10 years of tax sales and determine whether any homeowners who lost their homes after having small debts auctioned deserve some compensation from the city.

Pedro Ribeiro, a spokesman for Mayor Vincent C. Gray (D), said he expected the mayor to sign the bills as soon as they are transmitted. Emergency bills are effective for 90 days once signed.

Gray and Chief Financial Office Natwar M. Gandhi on Friday announced a package of reforms in response to the Post’s stories, including canceling the sales of dozens of homeowner tax debts auctioned by the city in July.

Mike DeBonis covers local politics and government for The Washington Post. He also writes a blog and a political analysis column that runs on Fridays.
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Mike DeBonis · September 17, 2013