Property Tax Liens Hit D.C. Elderly Hard

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By C.N. Staff Writer

The elderly are often considered the most vulnerable population of a city.  In a recent investigative seris by the Washington Post, it has been discovered that the Office of Tax and Revenue (OTR) has been faulty on property taxes, in particular with elderly citizens.  The investigation revealed that many of the D.C. homeowners–including those who were paying their taxes–were the subjects of tax liens. In many cases the wrongfully liened properties were actually sold. The Post reports that the D.C. Office of Tax and Revenue put nearly 1,900 owners at risk of foreclosure since 2007.

In many of the cases, OTR was faulty in their record keeping, which forced many elderly homeowners out of their homes.  D.C. would impose these tax liens, because of speculated unpaid taxes, in some cases as small as $134.00.  After the lien was imposed, the house went to a public auction where investors were able to buy them for little to nothing.  Once the investor acquired the house, the homeowner incurs erroneously high legal fees and interest rates, in turn losing their home.

The Post reported some standout cases of individuals who went through these experiences: “A 58-year-old bank employee almost lost her house in 2010 because the tax office mistakenly sent bills and notices to a wooded lot across from a strip shopping center in Virginia — 12 times.”  “Ninety-five-year-old Daisy Dolsey, living in a nursing home and struggling with Alzheimer’s, wasn’t so lucky: She lost her $300,000 house over a $44.79 tax debt even after she paid her taxes.” “A 69-year-old hat designer was given the wrong payoff amount and ended up in court to save her property, owned by her family since 1943.” “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.”

On Tuesday September 24th of this year, 78-year old retired Marine sergeant, Bennie Coleman filed a lawsuit against the city in federal court over his $134 tax bill, after he lost his home.  In the Post investigative report, it chronicled how Coleman was suffering with a severe case of dementia in 2006 when he forgot to pay his $134 tax bill and the city sold a lien on his Northeast home.  The investor who bought his home demeaned $4,999 in legal fees and court costs- 37 times the original tax bill, and Coleman was evicted from his home in 2011 by armed U.S. marshalls.  For months after his eviction he slept outside on his porch.

The District’s council has introduced emergency legislation that they hope will reform the way the city auctions property tax debts to private investors.  Ward 2 Councilmember Jack Evans (D) introduced the bill that will set a legal minimum of $2,000 for the tax debts offered at auction; freeze the sale of homes belonging to seniors, veterans and the disabled and limit the fees that debt buyers may charge to $1,500.  The legislation passed in a 12-to-0 vote, with Ward 6 Councilmember Tommy Wells (D) abstaining because he is uncomfortable with the idea of auctioning the homeowner’s tax debts to private parties.

Further, Councilmember Mary Cheh (D-Ward 3) introduced legislation, that was endorsed by the entire counsel, to order OTR to examine the last 10 years of tax sales to determine if any homeowners who lost their homes due to small debts they owed to the city, deserve back compensation from the city.

 

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