1. Report from the Tax Review Committee Proposed Process for Dealing with Delinquencies

2. Real Estate Delinquencies State Code provides various tools for the Treasurer to collect delinquent taxes, fines, fees, etc. Foreclosure process usually results in a public auction of property. This process is routinely used when all other methods of collection have not resulted in payment.

3. Additional Tools Provided by State Code  VA Code Sections 58.1-3975:  This legislation allows for a ''quick sale'' foreclosure when the property in question is assessed at $50,000 or less AND has delinquent taxes in excess of 25 percent of the assessed value or delinquent taxes and fine levies in excess of 50 percent.  Under this authority the Treasurer can offer to the City the opportunity to take the land in lieu of the owed taxes and/or fees.  If the City wants the property, there are still foreclosure fees of approximately $3,000 that will need to be paid.

4. Additional Tools Provided by State Code  VA Code Section 58.1-3970.1:  This legislation allows the Treasurer applies to delinquent properties assessed at $10,000 or less and which have 4,000 square feet or less OR which are deemed un-buildable by the Codes & Compliance Director.  Under this provision, the Treasurer can take the property and then dispose of the property.  The Treasurer would like to employ this tool because it is cheaper than the usual foreclosure process.  However, she would need some title review and title insurance assistance from an outside vendor.  She would use an RFP to secure these services which we anticipate would cost no more than $600 per parcel. Ms. Ward would need additional funds for this effort.

5. Should We Use These Tools? Ms. Ward presented these options to the tax review committee for their recommendation She is willing to use these tools but did not think she should do so without concurrence of the committee or the Council Pros and Cons of each were discussed at the committee and then the committee developed a recommended approach

6. Proposed Process 1. City staff identifies a 'tight' set of criteria around which a public purpose justifies the taking of property in lieu of auction foreclosure. 2. City staff identifies, to the extent possible, any parcels that meet these criteria that they would like the Treasurer to monitor for possible acquisition under this strategy and forwards this list to Ms. Ward. 3. If a property is on the list, Ms. Ward will offer to a city-identified contact the opportunity to acquire the property. The city will pay the anticipated $3,000 foreclosure costs from the Crime & Grime or other acquisition budget.

7. Proposed Process 4. If a property is not on the ''watch list'', and it is assessed at $5,000 or more, Ms. Ward will forward to Kaufman & Canoles for processing at no cost to the City. 5. If a property is not on the ''watch list'' and it is assessed at less than $5,000, Ms. Ward will determine if she can handle its disposition under her authorities. If she can, she will do so and will use whatever contractor support services warranted. If she cannot, she will refer the case to Kaufman & Canoles for processing.

8. Next Steps It was also agreed that it is necessary to clean up these delinquencies even if we take a hard-cost loss so the tax rolls can be as close to accurate and clean as possible. It was suggested that this approach be presented to the Council to ensure that they concur before the Treasurer begins execution.