The full Legislature will decide whether to beef up public-notice requirements in delinquent tax foreclosure cases after an August 2018 Nebraska Supreme Court decision that cost a rural North Platte family their farm.
State Sen. Matt Williams of Gothenburg said Wednesday he expects first-round floor debate sometime next week on his Legislative Bill 463, advanced 8-0 by the Revenue Committee on Feb. 22.
It would revamp the procedures for notifying real estate owners with chronically delinquent property taxes before the holders of county tax sale certificates become legally able to turn them into ownership deeds.
Among other provisions, LB 463 outlines a series of notification methods — starting with personal or residential service upon the property’s owners and occupants — that certificate holders would have to carry out before acquiring ownership.
It also would require the certificate holder, if anyone entitled to notice can’t be found, to post a legal notice in the county’s official newspaper for three consecutive weeks.
The Telegraph is that newspaper in Lincoln County.
Williams said the bill is meant to guard against reoccurrences of situations like the Supreme Court case involving the family of the late Gladys Pearl Wisner, who had owned a 480-acre farm nine miles southeast of North Platte.
Lavern and Susan Moss, who own a Ravenna home in Williams’ 36th District, lost title to their home in a similar case under a joint decree issued Monday in Buffalo County District Court.
Williams has made LB 463 his personal priority bill for 2019, ensuring it will be debated this session.
“It’s a much-needed bill and is fully supported” by his colleagues, he said.
Under Nebraska law, real estate can be “sold for taxes” the following March after its property taxes become delinquent. Purchasers of tax sale certificates pay the back taxes and subsequent annual taxes for three more years, earning 14 percent interest along the way.
If the property owner doesn’t pay off the back taxes and interest, the tax-sale certificate holder can either foreclose in district court or seek ownership by applying for a “treasurer’s tax deed.”
Current state law requires holders taking the latter course to notify the property owner of record 4½ months in advance and to publish legal notices for three consecutive weeks in any newspaper of general circulation in the county.
The Omaha World-Herald last year published stories on the plights of the Mosses and the Wisner family, each of which sued to overturn tax deeds obtained by tax-sale certificate investor Vandelay Investments Inc. of Lincoln.
Wisner, who died at age 99 in November 2015, lived at Centennial Park Retirement Village in North Platte for several years before her death. A son arranged for a bank to pay her farm’s property taxes from her trust, but the bank failed to do so, according to the State Supreme Court opinion.
A notice sent to Wisner at her retirement home by Vandelay, which bought her farm’s tax-sale certificate from another investor in February 2014, was returned unclaimed, the opinion said.
When Vandelay published its required legal notices, it did so in the Sutherland Courier-Times, on the other side of North Platte from the Wisner farm, rather than in The Telegraph.
Wisner’s family, which tried but failed to pay off their farm’s approximately $50,000 in back taxes and interest, sued in Lincoln County District Court to overturn the treasurer’s tax deed that Vandelay obtained in September 2014. Their farm was valued at $1.1 million, the World-Herald said.
District Judge Richard Birch dismissed the challenge, but a Nebraska Court of Appeals panel sided with the Wisners. A divided Supreme Court, however, ruled in August that Vandelay had satisfied current legal notice requirements.
In the Ravenna case, Lavern Moss told the World-Herald he had the money to pay $500 in half a year’s back taxes but didn’t know they had been sold until Vandelay notified him it had acquired his home with a treasurer’s tax deed.
Moss said he never received Vandelay’s required notification letter before the deed was issued, and the firm published its legal notices not in his hometown’s Ravenna News but in the Elm Creek Beacon-Observer, 45 miles away. Moss took the Ravenna paper.