‘Families should not lose their legacy’: Bill advances to afford more protections to delinquent property owners

LINCOLN — State lawmakers gave quick first-round approval Tuesday to a measure designed to better protect delinquent taxpayers from losing their property for pennies on the dollar.

Legislative Bill 463 deals with a legal process in which companies, or individuals, can pay off the delinquent taxes of a property owner and then, after waiting three years, acquire the land or home unless the property owner pays the taxes plus 14 percent interest.

series of stories in The World-Herald last year detailed how some unwitting landowners, who were unaware that someone else had acquired a legal interest in their property, eventually lost their homes or farmland.

In one case, an infirm, 94-year-old widow living in a North Platte nursing home lost a farm valued at $1.1 million to an investment company that paid $50,000 in back taxes and interest. One Nebraska Supreme Court judge described the deal as “a windfall that borders on the obscene.”

“Families should not lose their legacy, their inheritance, over delinquent taxes,” said State Sen. Mike Groene of North Platte, during debate on LB 463 Monday.

State Sen. Matt Williams of Gothenburg said the bill is a “substantial improvement” over the current notification process and will better ensure that delinquent taxpayers are aware that the ownership of their land is in jeopardy.

In the first step of the three-step notification process contained in the measure, a county deputy would deliver notification to both the landowner, as well as to the person renting or living on the land, that someone was ready to obtain a tax deed on a property. Under current law, only notification of the property owner is sought, which can be a problem if the landowner is hard to locate or doesn’t understand the notices being sent.

The last step of the notification process is publication of a legal notice in a newspaper in the county in which the property is located. LB 463 requires that paper to be the one selected by the county board for legal ads.

Current law allows that to be any newspaper in the county, which, in the North Platte case, allowed the notice to be published in a small-town paper 20 miles away.

A trio of senators questioned why those legal ads only require the legal description of the property and not the landowner’s name. Few people know the legal description of their home or farm, they said.

Bayard Sen. Steve Erdman said he is considering offering an amendment to include the names when the bill comes up for second-round debate.

Williams said a working group that helped draft the bill had rejected adding names to the legal notices. He said it would increase the cost of the legal ads that are required of county treasurers and the firms seeking to acquire the land, and might create an uproar among landowners for shaming them by putting their names in the paper.