1-1 By: Ellis S.B. No. 1151
1-2 (In the Senate - Filed March 9, 1995; March 15, 1995, read
1-3 first time and referred to Committee on Finance; May 9, 1995,
1-4 reported favorably, as amended, by the following vote: Yeas 8,
1-5 Nays 1; May 9, 1995, sent to printer.)
1-6 COMMITTEE AMENDMENT NO. 1 By: Ellis
1-7 Amend S.B. No. 1151 in SECTION 1, proposed Section 32.06(b),
1-8 Tax Code (introduced version page 1, line 14; committee printing
1-9 page 1, line 48), by inserting the following after the first
1-10 sentence of that subsection:
1-11 "A taxing unit may sell and transfer a tax lien on a residence
1-12 homestead, as defined by Section 11.13 of this code, under this
1-13 subsection only if all or part of the delinquent tax on that
1-14 residence homestead has been delinquent for at least three years.".
1-15 COMMITTEE AMENDMENT NO. 2 By: Ellis
1-16 Amend S.B. No. 1151 in SECTION 1, at the end of proposed
1-17 Section 32.06(b), Tax Code (introduced version page 2, line 7;
1-18 committee printing page 2, line 1), by adding a new sentence to
1-19 read as follows: "In offering a tax lien for sale and transfer
1-20 under this subsection, the taxing unit may set a minimum price for
1-21 the sale and may accept or reject any offer made to purchase the
1-22 lien.".
1-23 COMMITTEE AMENDMENT NO. 3 By: Ellis
1-24 Amend S.B. No. 1151 in SECTION 1, at the end of proposed
1-25 Section 32.06(d), Tax Code (introduced version page 3, line 5;
1-26 committee printing page 2, line 24), by adding a new sentence to
1-27 read as follows: "A taxing unit may provide in its procedure for
1-28 the sale and transfer of a tax lien under Subsection (b) of this
1-29 section limitations on the authority of the transferee of the lien
1-30 to protect a delinquent taxpayer from abusive, deceptive, or unfair
1-31 debt collection practices and may provide as a sanction for a
1-32 violation of a limitation the reversion of the transferee's
1-33 interest in the lien to the taxing unit.".
1-34 A BILL TO BE ENTITLED
1-35 AN ACT
1-36 relating to the transfer of tax liens.
1-37 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-38 SECTION 1. Section 32.06, Tax Code, is amended to read as
1-39 follows:
1-40 Sec. 32.06. Transfer of Tax Lien. (a) A person may
1-41 authorize another person to pay the taxes imposed by a taxing unit
1-42 on his real property by filing with the collector for the unit a
1-43 sworn document stating the authorization, naming the person
1-44 authorized to pay the taxes, and describing the property.
1-45 (b) The governing body of a taxing unit may adopt, in the
1-46 manner required by law for official action by the body, a procedure
1-47 to provide for the sale and transfer by the taxing unit of any tax
1-48 lien existing in its favor which represents a delinquent tax. The
1-49 provisions of the procedure shall be those deemed appropriate by
1-50 the governing body, subject to the provisions of this section. Tax
1-51 liens of a taxing unit may be sold and transferred pursuant to this
1-52 subsection to any person, in any lot or block, and for any purchase
1-53 price deemed appropriate by the governing body, provided that,
1-54 prior to any such sale and transfer, the collector for the taxing
1-55 unit shall cause to be inserted in the legal organ for the taxing
1-56 unit once a week for two consecutive weeks, the second publication
1-57 being at least 30 days prior to the sale and transfer, a notice
1-58 listing the names of all delinquent taxpayers and the related
1-59 properties subject to such sale and transfer. The sale and
1-60 transfer of each tax lien pursuant to this subsection shall be
1-61 evidenced by a sworn document issued by the taxing unit reciting
1-62 the full amount of the tax lien, including penalties and interest
1-63 then accrued, and naming the purchaser of the tax lien, the
1-64 delinquent taxpayer, and the related property.
1-65 (c) If a person authorized to pay another's taxes pursuant
1-66 to Subsection (a) of this section pays the taxes and any penalties
1-67 and interest imposed or if a person purchases a tax lien from a
1-68 taxing unit pursuant to Subsection (b) of this section, the
2-1 collector for the taxing unit shall issue a tax receipt to the
2-2 person <paying the taxes>. In addition, the collector shall
2-3 certify on the sworn document that payment of the taxes and any
2-4 penalties and interest on the described property has been made by a
2-5 person other than the person liable for the tax <taxes when
2-6 imposed> and that the taxing unit's tax lien is transferred to the
2-7 person paying the taxes or purchasing the tax lien. The collector
2-8 shall attach to the document his seal of office and deliver the
2-9 document to the person paying the taxes. The collector shall keep
2-10 a record of all tax liens transferred as provided by this section.
2-11 (d) <(c)> Except as otherwise provided by this section, the
2-12 transferee of a tax lien and any assignee or successor in interest
2-13 of such transferee shall be subrogated to and shall have the same
2-14 rights, powers, liens, and priority of payments as might have been
2-15 exercised or claimed by the taxing unit before the transfer,
2-16 including the right to collect the full amount of the delinquent
2-17 tax together with all penalties, interest, and other amounts
2-18 provided by law and the right <is entitled> to foreclose the lien
2-19 in the manner provided by law for foreclosure of tax liens.
2-20 (e) <(d)> To be enforceable, a tax lien transferred as
2-21 provided by this section must be recorded in the deed records of
2-22 each county in which the property encumbered by the lien is
2-23 located.
2-24 (f) <(e)> A person holding a tax lien transferred as
2-25 provided by Subsection (a) of this section may not charge a greater
2-26 rate of interest than 10 percent a year on the taxes, penalties,
2-27 interest, and recording expenses paid to acquire and record the
2-28 lien.
2-29 (g) <(f)> The holder of a preexisting lien on property
2-30 encumbered by a tax lien transferred as provided by this section is
2-31 entitled, within six months after the date on which the tax lien is
2-32 recorded in all counties in which the property is located, to pay
2-33 the holder of the tax lien the amount paid for the lien, plus
2-34 interest accrued and recording expenses, and becomes subrogated to
2-35 all rights in the lien.
2-36 (h) <(g)> A suit to foreclose a tax lien transferred as
2-37 provided by Subsection (a) of this section may not be instituted
2-38 within one year from the date on which the lien is recorded in all
2-39 counties in which the property is located. A suit to foreclose a
2-40 tax lien transferred as provided by Subsection (b) of this section
2-41 may not be instituted within 60 days from the date on which the
2-42 lien is recorded in all counties in which the property is located.
2-43 (i) After the period provided in Subsection (h) of this
2-44 section has expired <(h) After one year from the date on which a
2-45 tax lien transferred as provided by this section is recorded in all
2-46 counties in which the property is located>, the holder of the lien
2-47 may file suit to foreclose the lien unless a contract between the
2-48 holder of the lien and the owner of the property encumbered by the
2-49 lien provides otherwise. If a <the> suit results in foreclosure of
2-50 a tax <the> lien transferred pursuant to Subsection (a) of this
2-51 section, the person filing suit is entitled to recover attorney's
2-52 fees in an amount not to exceed 10 percent of the judgment. The
2-53 proceeds of a sale following foreclosure as provided by this
2-54 subsection shall be applied first to the payment of court costs,
2-55 then to payment of the judgment, including accrued interest, and
2-56 then to the payment of any attorney's fees fixed in the judgment.
2-57 Any remaining proceeds shall be paid to other holders of liens on
2-58 the property in the order of their priority and then to the person
2-59 whose property was sold at the tax sale.
2-60 (j) <(i)> The person whose property is sold as provided by
2-61 this section or any person holding a first lien against the
2-62 property is entitled, within one year after the date the property
2-63 is sold, to redeem the property from the purchaser at the tax sale
2-64 by paying him the tax sale purchase price, plus costs and interest
2-65 accrued on the judgment to the date of redemption or 110 percent of
2-66 the amount of the judgment, whichever is less. If a person redeems
2-67 the property as provided by this subsection, the purchaser at the
2-68 tax sale shall deliver a deed to the property to the person
2-69 redeeming the property. If the person who owned the property at
2-70 the time of foreclosure redeems the property, all liens existing on
3-1 the property at the time of the tax sale remain in effect to the
3-2 extent not paid from the sale proceeds.
3-3 (k) <(j)> This section does not abridge the right of an
3-4 owner of real property to enter into a contract for the payment of
3-5 taxes with the holder of a lien on the property or affect a
3-6 contract between the owner and holder of a lien for the payment of
3-7 taxes on the property.
3-8 SECTION 2. The importance of this legislation and the
3-9 crowded condition of the calendars in both houses create an
3-10 emergency and an imperative public necessity that the
3-11 constitutional rule requiring bills to be read on three several
3-12 days in each house be suspended, and this rule is hereby suspended,
3-13 and that this Act take effect and be in force from and after its
3-14 passage, and it is so enacted.
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