Roughly 2,000 Baltimore City homeowners will be removed from the city’s coming tax sale after a vote by the Board of Estimates on Wednesday.
The vote comes after Mayor Brandon Scott announced in April that the city would be doing so. The move is aimed at lessening the impact of a system that forces some low-income homeowners to pay thousands of dollars in owed taxes, interest and fees to lien holders — or face the loss of their homes.
“Simply put, we want our residents to remain in their homes,” Scott said at a press conference following the Board of Estimates meeting. “This is something that is significant for the residents of Baltimore as we talk about keeping our legacy and residents inside their homes.”
It’s the third year in a row that homes classified by the city as owner-occupied will be removed from Baltimore’s tax sale, the city’s annual process of recouping unpaid property taxes by selling off liens to investors, who can charge homeowners steep interest and eventually foreclose on their homes if debts remain unpaid.
Officials spoke on Wednesday about the harms the current system inflicts on homeowners and communities.
“As we continue to rip away families from communities, rip up communities that are literally the thread of our city of Baltimore, we understand and know that there’s a residual impact for the future,” said council President Nick Mosby.
The city’s annual tax sale is scheduled for May 15. The homes that will be removed from the tax sale have liens totaling just over $16 million, according to the tax sale list as of May 10 reviewed by The Baltimore Banner. That leaves more than 5,200 non-owner-occupied homes slated to go to tax sale with liens totaling $94 million.
Unlike in previous years, the city will keep owner-occupied homes with values of more than $250,000 in the annual tax sale — which works out to just under 100 homes with lien values of under $800,000.
“This is about impacting our residents who are the most in need,” said Scott.
Allison Harris, an attorney with the Pro Bono Resource Center of Maryland, said that while she is grateful that city officials decided to remove many homeowners from the tax sale, she questioned the decision to exclude homes with higher values. It’s a small group of homeowners, she acknowledged, but those homeowners may still need this relief.
“Just because their homes are assessed over $250,000 doesn’t mean they’re not low-income,” said Harris, noting the spikes in assessed values in recent years.
She also criticized the city for missing an opportunity during the Maryland legislative session to reform the tax sale system more broadly.
In early April, a bill proposed by the city to allow it to undertake a sweeping overhaul of the system died in the state legislature after city officials raised concerns about the cost amid an unexpected state school funding mandate.
Without this broader change to the system, residents who may not have full titles to their properties remain vulnerable to tax sale. Attorneys representing people facing tax sale say that many of their clients are living in homes classified as “non-owner occupied.” This is often because the home was passed down from a deceased family member but heirs failed to complete the complicated process of updating the deed.
An analysis by The Baltimore Banner found that many homes classified as non-owner-occupied may in fact be occupied by an owner, rather than owned by a landlord or investor. The Banner identified roughly 10,000 homes liened since 2016 where the address of the property owner, according to state records, matched that of a property that had a lien put on it. But the majority of those homes — 6,313 — were classified by the state as non-owner-occupied, while just 3,895 of those homes were listed as owner- occupied.
On Wednesday, Scott committed to pushing the measure in next year’s legislative session.
Councilwoman Odette Ramos, who has been a vocal advocate for tax sale reform, said the city needs to work more closely with the legislative delegation to promote the bill in the next legislative session. She said the city also needs to determine more specifics of how it would work with residents to pay their taxes without the tax sale system, a significant outreach demand that she said the Department of Finance doesn’t currently have the capacity to do.
“We want people to pay,” said Ramos, “But we want to do it in a way that makes a lot of sense.”