By: Ellis S.B. No. 1505
Line and page numbers may not match official copy.
Bill not drafted by TLC or Senate E&E.
A BILL TO BE ENTITLED
AN ACT
1-1 relating to the transfer of tax liens.
1-2 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-3 SECTION 1. Section 32.06, Tax Code, is amended to read as
1-4 follows:
1-5 Sec. 32.06. Transfer of Tax Lien. (a) A person may
1-6 authorize another person to pay the taxes imposed by a taxing unit
1-7 on his real property by filing with the collector for the unit a
1-8 sworn document stating the authorization, naming the person
1-9 authorized to pay the taxes, and describing the property.
1-10 (b) The governing body of a taxing unit may adopt, in the
1-11 manner required by law for official action by the body, a procedure
1-12 to provide for the sale and transfer by the taxing unit of any tax
1-13 lien existing in its favor which represents a delinquent tax. The
1-14 provisions of the procedure shall be those deemed appropriate by
1-15 the governing body, subject to the provisions of this section. Tax
1-16 liens of a taxing unit may be sold and transferred pursuant to this
1-17 subsection to any person, in any lot or block, and for any purchase
1-18 price deemed appropriate by the governing body, provided that,
1-19 prior to any such sale and transfer, the collector for the taxing
1-20 unit shall cause to be inserted in the legal organ for the taxing
1-21 unit once a week for two consecutive weeks, the second publication
2-1 being at least 30 days prior to the sale and transfer, a notice
2-2 listing the names of all delinquent taxpayers and the related
2-3 properties subject to such sale and transfer. The sale and
2-4 transfer of each tax lien pursuant to this subsection shall be
2-5 evidenced by a sworn document issued by the taxing unit reciting
2-6 the full amount of the tax lien, including penalties and interest
2-7 then accrued, and naming the purchaser of the tax lien, the
2-8 delinquent taxpayer, and the related property.
2-9 (c) If a person authorized to pay another's taxes pursuant
2-10 to Subsection (a) of this section pays the taxes and any penalties
2-11 and interest imposed or if a person purchases a tax lien from a
2-12 taxing unit pursuant to Subsection (b) of this section, the
2-13 collector for the taxing unit shall issue a tax receipt to the
2-14 person [paying the taxes]. In addition, the collector shall
2-15 certify on the sworn document that payment of the taxes and any
2-16 penalties and interest on the described property has been made by a
2-17 person other than the person liable for the tax [taxes when
2-18 imposed] and that the taxing unit's tax lien is transferred to the
2-19 person paying the taxes or purchasing the tax lien. The collector
2-20 shall attach to the document his seal of office and deliver the
2-21 document to the person paying the taxes. The collector shall keep
2-22 a record of all tax liens transferred as provided by this section.
2-23 (d) [(c)] Except as otherwise provided by this section, the
2-24 transferee of a tax lien and any assignee or successor in interest
2-25 of such transferee shall be subrogated to and shall have the same
3-1 rights, powers, liens, and priority of payments as might have been
3-2 exercised or claimed by the taxing unit before the transfer,
3-3 including the right to collect the full amount of the delinquent
3-4 tax together with all penalties, interest, and other amounts
3-5 provided by law and the right [is entitled] to foreclose the lien
3-6 in the manner provided by law for foreclosure of tax liens.
3-7 (e) [(d)] To be enforceable, a tax lien transferred as
3-8 provided by this section must be recorded in the deed records of
3-9 each county in which the property encumbered by the lien is
3-10 located.
3-11 (f) [(e)] A person holding a tax lien transferred as
3-12 provided by Subsection (a) of this section may not charge a greater
3-13 rate of interest than 10 percent a year on the taxes, penalties,
3-14 interest, and recording expenses paid to acquire and record the
3-15 lien.
3-16 (g) [(f)] The holder of a preexisting lien on property
3-17 encumbered by a tax lien transferred as provided by this section is
3-18 entitled, within six months after the date on which the tax lien is
3-19 recorded in all counties in which the property is located, to pay
3-20 the holder of the tax lien the amount paid for the lien, plus
3-21 interest accrued and recording expenses, and becomes subrogated to
3-22 all rights in the lien.
3-23 (h) [(g)] A suit to foreclose a tax lien transferred as
3-24 provided by Subsection (a) of this section may not be instituted
3-25 within one year from the date on which the lien is recorded in all
4-1 counties in which the property is located. A suit to foreclose a
4-2 tax lien transferred as provided by Subsection (b) of this section
4-3 may not be instituted within 60 days from the date on which the
4-4 lien is recorded in all counties in which the property is located.
4-5 (i) After the period provided in Subsection (h) of this
4-6 section has expired [(h) After one year from the date on which a
4-7 tax lien transferred as provided by this section is recorded in all
4-8 counties in which the property is located], the holder of the lien
4-9 may file suit to foreclose the lien unless a contract between the
4-10 holder of the lien and the owner of the property encumbered by the
4-11 lien provides otherwise. If a [the] suit results in foreclosure of
4-12 a tax [the] lien transferred pursuant to Subsection (a) of this
4-13 section, the person filing suit is entitled to recover attorney's
4-14 fees in an amount not to exceed 10 percent of the judgment. The
4-15 proceeds of a sale following foreclosure as provided by this
4-16 subsection shall be applied first to the payment of court costs,
4-17 then to payment of the judgment, including accrued interest, and
4-18 then to the payment of any attorney's fees fixed in the judgment.
4-19 Any remaining proceeds shall be paid to other holders of liens on
4-20 the property in the order of their priority and then to the person
4-21 whose property was sold at the tax sale.
4-22 (j) [(i)] The person whose property is sold as provided by
4-23 this section or any person holding a first lien against the
4-24 property is entitled, within one year after the date the property
4-25 is sold, to redeem the property from the purchaser at the tax sale
5-1 by paying him the tax sale purchase price, plus costs and interest
5-2 accrued on the judgment to the date of redemption or 110 percent of
5-3 the amount of the judgment, whichever is less. If a person redeems
5-4 the property as provided by this subsection, the purchaser at the
5-5 tax sale shall deliver a deed to the property to the person
5-6 redeeming the property. If the person who owned the property at
5-7 the time of foreclosure redeems the property, all liens existing on
5-8 the property at the time of the tax sale remain in effect to the
5-9 extent not paid from the sale proceeds.
5-10 (k) [(j)] This section does not abridge the right of an
5-11 owner of real property to enter into a contract for the payment of
5-12 taxes with the holder of a lien on the property or affect a
5-13 contract between the owner and holder of a lien for the payment of
5-14 taxes on the property.
5-15 SECTION 2. The importance of this legislation and the
5-16 crowded condition of the calendars in both houses create an
5-17 emergency and an imperative public necessity that the
5-18 constitutional rule requiring bills to be read on three several
5-19 days in each house be suspended, and this rule is hereby suspended,
5-20 and that this Act take effect and be in force from and after its
5-21 passage, and it is so enacted.