Property tax sale prompts most owners to pay bills

The annual Trail property tax sale, held in the form of a public auction, took place in September across the Greater Trail region.

The annual property tax sale, held in the form of a public auction, took place in September across the Greater Trail region.

The annual sale allowed municipal governments to collect outstanding property taxes by imposing a one-year period of grace for owners to “redeem” the property after the sale.

During the allotted time frame the previous owners can re-gain property titles by paying overdue payments (taxes) and interest rates. However, the one-year period is subject to further conditions imposed by city council.

In the past, Trail council had extended the period of tax sale to one year, giving homeowners another chance to clear their debt and their name. In keeping with that, earlier this month city council passed third reading on a bylaw to hold on title the deed to the 12 properties that were in arrears on taxes and were up in the tax sale.

The nature of the sale confused Mayor Dieter Bogs and he asked Trail chief administrative officer David Perehudoff if—during the tax sale—he bid the amount owing in back taxes, would he automatically purchase a house for the amount owing on the back taxes.

Perehudoff said no.

“So why is it a tax sale if you can’t buy it, anyhow?” Bogs countered.

There are two issues with respect to the upset price, said Perehudoff, which is the amount owing the city as registered on the title.

The city can act as the primary bidder and their policy is to bid up to 75 per cent of the assessed value of the home. To become the purchaser of a tax sale home, a bidder other than the city would have to bid 75 per cent plus one dollar to hold the title.

“But with respect to purchasing, you are not technically purchasing the property,” said Perehudoff. “You are just effectively registering notice on title … to have the right to own it if the person does not effectively pay the upset price (of their taxes owing).”

The mayor asked when a bidder would get the house if they won the bid.

“You would have the house on title with your name registered there, and if the person did not pay the upset price within the year, you would effectively have the property,” said Perehudoff.

If the property is not redeemed during the one-year period, the collector registers new owners at the Kamloops Land Title and Survey Authority.

There were originally 28 properties advertised for sale in Trail but that number was reduced to 12 after 16 landowners cleared up their payments. There were also two properties in each Warfield, Montrose and Fruitvale. However, all property owners cleared up their taxes before the date of the sale.

“So that was a good thing,” said Fruitvale chief administrative officer Lila Cresswell. “Everybody has paid their taxes.”

All sales were held in their respective council chambers.

If a bidder fails to provide a certified cheque or cash payment in full, the collector again offers the property for sale.