Bill Text: MI HB6261 | 2019-2020 | 100th Legislature | Introduced
Bill Title: Property tax: delinquent taxes; procedure for claiming an interest in remaining proceeds of a foreclosed property; provide for.
Spectrum: Partisan Bill (Democrat 14-0)
Status: (Introduced - Dead) 2020-09-29 - Bill Electronically Reproduced 09/24/2020 [HB6261 Detail]
Download: Michigan-2019-HB6261-Introduced.html
HOUSE BILL NO. 6261
September 24, 2020, Introduced by Reps.
Sowerby, Guerra, Chirkun, Ellison, Brixie, Wittenberg, Hood, Sabo, Hertel,
Sneller, Liberati, Hammoud, Brenda Carter and Clemente and referred to the
Committee on Local Government and Municipal Finance.
A bill to amend 1893 PA 206, entitled
"The general property tax act,"
(MCL 211.1 to 211.155) by adding section 78t.
the people of the state of michigan enact:
Sec. 78t. (1) A person claiming an
interest in property forfeited to a county treasurer under section 78g and
foreclosed under section 78k may file a notice of intention to claim an
interest in any applicable remaining proceeds under this subsection. All of the
following apply to a notice filed under this subsection:
(a)
The notice must be filed with the circuit court that entered the judgment of
foreclosure on the property under section 78k.
(b)
The filing must be completed within 1 of the following time frames, as
applicable:
(i) Within 90 days after title to the property
vests in the foreclosing governmental unit pursuant to a judgment entered under
section 78k, if that vesting occurred on or after the effective date of the
amendatory act that added this section. The circuit court shall provide the
foreclosing governmental unit with a copy of a notice filed under this
subparagraph by not later than the first Monday of the following November.
(ii) Within 90 days after the effective date of the
amendatory act that added this section, if title to the property vested in the
foreclosing governmental unit pursuant to a judgment entered under section 78k
within 2 years immediately preceding the effective date of the amendatory act
that added this section. A claim of an interest in remaining proceeds may not
be made under this subsection as to foreclosed property the title to which
vested in the foreclosing governmental unit before this 2-year time frame. The
circuit court shall provide the foreclosing governmental unit with a copy of a
notice filed under this subparagraph within 7 days after the filing.
(c)
The notice must include all of the following:
(i) The name, telephone number, and mailing address
of the person claiming an interest in remaining proceeds.
(ii) The property's parcel identification number and
address if an address is available.
(iii) A description of the interest in the property
claimed.
(iv) A sworn statement or affirmation that the
information included in the notice is accurate.
(2)
If 1 or more persons claiming an interest in a property forfeited to a county
treasurer under section 78g and foreclosed under section 78k properly file a
notice of intention under subsection (1), the foreclosing governmental unit in
which title to the property vested pursuant to the judgment of foreclosure
shall respond to each claimant with a responsive notice. All of the following
apply to a responsive notice provided under this subsection:
(a)
The responsive notice must be sent by certified mail to each claimant within 1
of the following time frames, as applicable:
(i) For a responsive notice applicable to a claimant's
notice of intention filed under subsection (1)(b)(i), within 60 days after the first Tuesday of
November.
(ii) For a responsive notice applicable to a claimant's
notice of intention filed under subsection (1)(b)(ii), within 60 days after the notice of intention
was filed.
(b)
The responsive notice must include all of the following information:
(i) The property's parcel identification number,
legal description, and address if an address is available.
(ii) The date on which the foreclosing governmental
unit sold or transferred the property or, if the property was not sold or
transferred, a statement indicating that the property was not sold or
transferred.
(iii) The minimum bid for the property as determined
by the foreclosing governmental unit.
(iv) The amount for which the property was sold or
transferred.
(v) The amount of any remaining proceeds or the
amount of any shortfall, depending on whether the amount for which the property
was sold or transferred was greater or less than the sum of the following,
which must be itemized in the notice:
(A)
The minimum bid.
(B)
Fees incurred by the foreclosing governmental unit for all of the following to
the extent they were not included in the minimum bid:
(I)
The foreclosure proceedings, including fees for notices by personal service,
mail, and publication; legal fees; personnel costs; and contractor costs.
(II)
The sale or transfer of the property.
(III)
Maintenance of the property, including costs of repair, improvements, and
environmental remediation.
(vi) The name and address provided by each person
claiming an interest in the property under subsection (1).
(vii) A statement that a claimant must file a motion as
described in subsection (3) with the circuit court in the same proceeding in
which a judgment of foreclosure was effective under section 78k to claim any
remaining proceeds payable to the claimant.
(3)
After receipt of a responsive notice described in subsection (2), a claimant
may file a motion with the circuit court in the same proceeding in which a
judgment of foreclosure was effective under section 78k to claim any portion of
the remaining proceeds that the claimant is entitled to under this section. All
of the following apply to a motion filed under this subsection:
(a)
The motion must be filed within 1 of the following time frames, as applicable:
(i) For a motion based on a claim initiated under
subsection (1)(b)(i), not later than April 15 of the year
immediately succeeding the year in which the property was sold or transferred.
(ii) For a motion based on a claim initiated under
subsection (1)(b)(ii), within 90 days after receipt of the
responsive notice mailed under subsection (2)(a)(ii).
(b)
The motion must provide the specific basis for the claimant's asserted interest
in some or all of the remaining proceeds, including a description of the
claimant's interest in the property immediately preceding its foreclosure under
section 78k and documentation evidencing that interest. If the claimant had a
lien or other security interest in the property at the time the judgment of
foreclosure was effective under section 78k, the claimant shall indicate the
amount owed to the claimant pursuant to the lien or security interest. The
motion must be verified and include a sworn statement or affirmation by the
claimant of its accuracy.
(c)
Within 21 days after filing the motion, the claimant shall serve a copy of the
motion on the foreclosing governmental unit and any other claimant that had properly
filed a notice of intention as to the property under subsection (1).
(4)
For each property for which 1 or more claimants filed notices of intention
under subsection (1), the foreclosing governmental unit shall file with the
circuit court all of the documentation and information described in
subdivisions (a) and (b), within the applicable time frame described in
subdivision (c), as follows:
(a)
Proof of service of the responsive notice required under subsection (2) as to
all claimants.
(b)
All of the following information:
(i) The property's parcel identification number,
legal description, and address if an address is available.
(ii) The date on which the foreclosing governmental
unit sold or transferred the property or, if the property was not sold or
transferred, a statement indicating that the property was not sold or
transferred.
(iii) The minimum bid for the property as determined
by the foreclosing governmental unit.
(iv) The amount for which the property was sold or
transferred.
(v) The amount of any remaining proceeds or the
amount of any shortfall, depending on whether the amount for which the property
was sold or transferred was greater or less than the sum of the following,
which must be itemized in the filing:
(A)
The minimum bid.
(B)
Fees incurred by the foreclosing governmental unit for all of the following to
the extent they were not included in the minimum bid:
(I)
The foreclosure proceedings, including fees for notices by personal service,
mail, and publication; legal fees; personnel costs; and contractor costs.
(II)
The sale or transfer of the property.
(III)
Maintenance of the property, including costs of repair, improvements, and environmental
remediation.
(vi) The name and address provided by each claimant
that filed a notice of intention under subsection (1).
(c)
The filing required under this subsection must be completed within 1 of the
following time frames, as applicable:
(i) For a filing based on 1 or more claimant notices
of intention filed under subsection (1)(b)(i), not later than April 15 of the year
immediately succeeding the year in which the property was sold or transferred.
(ii) For a filing based on 1 or more claimant notices
of intention filed under subsection (1)(b)(ii), within 90 days after the mailing of the
responsive notice under subsection (2)(a)(ii).
(5)
The court shall hold a hearing for each property for which 1 or more claimants
filed a motion under subsection (3). All of the following apply to a hearing
held under this subsection:
(a)
The court shall set the hearing date in 1 of the following ways, as applicable:
(i) For a hearing based on filings under subsections
(3)(a)(i) and (4)(c)(i), the court shall, by not later than May 15 of
the year immediately succeeding the year in which the property was sold or
transferred, set a hearing date and shall notify each claimant and the
foreclosing governmental unit of the hearing date at least 30 days before the
hearing date.
(ii) For a hearing based on a filings under
subsections (3)(a)(ii) and (4)(c)(ii), the court shall, within 30 days after the
filings, set a hearing date and shall notify each claimant and the foreclosing
governmental unit of the hearing date at least 30 days before the hearing date.
(b)
The court shall determine the relative priority and value of the interest of
each claimant in the foreclosed property immediately before the foreclosure
went into effect.
(c)
The burden of proof of a claimant's interest in any remaining proceeds is on
the claimant.
(d)
The court shall determine whether payment to 1 or more claimants is required,
allocate any remaining proceeds based on its determination, and order the
payment of applicable remaining proceeds to 1 or more claimants consistent with
its determination, as provided in subsection (6). The amount payable to a
claimant must not exceed the amount attributable to the claimant's interest in
the property immediately before the entry of judgment of foreclosure of the
property under section 78k. The order also must provide that any further claim
by a claimant under this act relating to the property is barred.
(6)
A payment ordered under subsection (5) must be made by 1 of the following governmental
entities within 30 days after the order is entered:
(a)
The foreclosing governmental unit, if title to the property vested in the
foreclosing governmental unit pursuant to the judgment entered under section
78k on or after the effective date of the amendatory act that added this
section.
(b) The department of treasury, if title to the property vested in the foreclosing governmental unit pursuant to the judgment entered under section 78k before the effective date of the amendatory act that added this section.
