ARIZONA STATE SENATE
Phoenix, Arizona
tax liens;
certificate of purchase
Requires, at the discretion of the county treasurer, a purchaser of a tax lien to agree to acquire all outstanding certificates of purchase previously issued on the property as a condition of the sale.
State statute requires the county treasurer to notify to each person that there are delinquent taxes against the real property that is assessed in the taxpayer’s name. If the taxes are not paid when due and become delinquent, the county treasurer is required to advertise and sell a lien on the property for the unpaid taxes, penalties, interest and charges. To purchase a lien, the purchaser pays the delinquent taxes, interest, penalties and charges and offers to accept an interest rate of no more than 16 percent.
If the person who holds a certificate of purchase for the tax lien desires to pay subsequent taxes, accrued interest and related fees due on the property for the next tax year, the county treasurer must endorse the amount paid on the certificate. If the original purchaser does not pay subsequent taxes, the county treasurer resells the tax lien to any person who pays the whole amount due for the certificate, including interest, penalties and charges, in addition to the entire amount of subsequent taxes.
Currently, there is confusion and conflict among various county treasurers regarding the sale of subsequent certificates of purchase on a single property occurring in different years. The statute is unclear if the subsequent purchaser is required to pay all outstanding certificates of purchase previously issued on the property. S.B. 1040 codifies current practices of some Arizona counties.
There is no fiscal impact to the state general fund associated with this legislation.
1. Requires, at the discretion of the county treasurer, the purchaser of a real property tax lien to agree to acquire by assignment all outstanding certificates of purchase previously issued on the property as a condition of sale.
2. Authorizes the county treasurer to require a person who desires to purchase a subsequent certificate of purchase to purchase all outstanding certificates of purchase previously issued on the property, if the person who holds a certificate of purchase does not pay subsequent taxes, accrued interest and related fees due on the property.
3. Requires the county treasurer to process the sale as an assignment on behalf of the previous holder of the certificate of purchase.
4. Stipulates that all the right and title of the original purchaser is vested in the purchaser of the tax lien.
5. Makes technical changes.
6. Provides for a general effective date.
Amendments
Adopted by Committee of the Whole
1. Requires the county treasurer to process the sale as an assignment on behalf of the previous lien holder.
2. Clarifies that the person who holds a tax lien is not required to be holder of the first lien on the property in a sale of the subsequent lien.
3. Requires the subsequent purchaser to purchase, rather than acquire by assignment, all outstanding certificates of purchase previously issued on the property.
Senate Action
GOV 1/21/02 DP 6-0-0
3rd Read 1/30/02 26-0-4
Prepared by Senate Staff
January 31, 2002