Mayor backs more ‘compassionate’ approach to tax liens

PROVIDENCE – A bill backed by Mayor David N. Cicilline, the Urban League of Rhode Island and the Rhode Island Housing & Mortgage Finance Corp. would help protect people from losing their homes by selling tax liens to a nonprofit agency rather than to any willing buyer.

The legislation, introduced by state Rep. Joseph Almeida and state Sen. Harold Metts, both Providence Democrats, and unveiled at a news conference Monday, would affect Providence and any other municipality that chooses to take part.

“This is a concerted effort by the Urban League, Rhode Island Housing and the City of Providence to deal responsibly but compassionately with those whose properties fall into tax sale, and to fairly protect all of our taxpayers,” Cicilline said in a news release.

“People losing their homes undermines the strength of that neighborhood, it undermines the strength of that family,” Cicilline added. “They are a part of our community, and we want them to remain a part of our community.”

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The existing law, said Dennis Langley, executive director of the Urban League of Rhode Island, “allows speculators to take advantage of the elderly and the poor,” and “is causing more harm to communities than ever before.”

“We must put an end to this unconscionable and predatory practice,” Langley said, “and it’s my hope that this proposed legislation will help us accomplish that goal.”

Under the proposed law, when a property falls into delinquency because of unpaid property taxes, the city will sell – in bulk – tax liens to a nonprofit corporation established by the city and Rhode Island Housing. The city will receive at the time of tax lien sale full taxes and unpaid interest.

Rhode Island Housing, through an agreement with the corporation, will work with the individual owners to fully resolve their back taxes and help them retain their property.

The city and Rhode Island Housing will administer the corporation. Its mission will be to promote home ownership, assist homeowners to retain ownership, promote affordable housing, development and remediation. The committee overseeing the corporation will be made up equally of municipal and Rhode Island Housing appointees. The mayor will appoint the chair.

“This initiative requires tact, patience, real estate savvy and experience working with families already strained to the limit,” said Mike Milito, of Rhode Island Housing. “Few organizations would take it on, but we know this market and already provide the necessary financial literacy and credit counseling services. One way or the other, we’ll help people hold onto their homes.”

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