Hennepin County, Minnesota homeowner Geraldine Tyler in an undated photo. (Courtesy of Pacific Legal Foundation) Posted on 01/16/2023 8:32:37 AM PST by Red Badger
Hennepin County, Minnesota homeowner Geraldine Tyler in an undated photo. (Courtesy of Pacific Legal Foundation)
The Supreme Court decided late on Jan. 13 to hear the appeal of a 94-year-old homeowner who is challenging the constitutionality of laws that allow local governments to take the full value of a home as payment for much smaller property tax debts.
The decision came after the Pacific Legal Foundation (PLF), a public interest law firm that is representing the homeowner, released a report last month saying that 12 states and the District of Columbia allow local governments and private investors to seize dramatically more than what is owed from homeowners who fall behind on property tax payments.
The PLF calls the practice “home equity theft.”
Minnesota law allows counties to retain windfalls at the expense of property owners, and from 2014 to 2020, about 1,200 Minnesota residents lost their homes, along with the equity they held, for debts that averaged 8 percent of the home’s value, according to the PLF.
The American Legislative Exchange Council (ALEC), an alliance of conservative lawmakers, is opposed to the practice. Laws should be changed to require surplus profits to be returned to a home’s prior owner after a “tax lien investor or county collects what it is due and any other debts or levies on the property are paid,” ALEC says.
“Home equity is property protected by the Constitution,” said Christina Martin, a senior attorney at PLF, after the high court granted its client’s petition.
“When the government takes more than it is owed in taxes, that’s home equity theft. We are thrilled the Supreme Court will hear this case, which we hope will end unconstitutional home equity theft across the country.”
The justices did not explain in an unsigned order why they agreed to review the case, Tyler v. Hennepin County, Minnesota, court file 22-166.
Geraldine Tyler owned a modest one-bedroom condominium in Hennepin County, but after she was harassed and frightened near her home, she moved to a new apartment in a safer neighborhood. The rent on her new apartment stretched her resources and she fell into arrears on her condo’s property tax bills, accumulating about $2,300 in taxes owed, along with $12,700 in penalties, interest, and costs.
The county seized Tyler’s condo, valued at $93,000, and sold it for just $40,000. Instead of keeping the $15,000 it was owed, the county retained the full $40,000, amounting to a windfall of $25,000, according to the PLF.
Tyler sued but her lawsuit was rejected by the courts, including the U.S. Court of Appeals for the 8th Circuit, which found that the legal forfeiture of the property extinguished the owner’s property interest.
Tyler welcomed the opportunity to have her day in court.
“It would mean a lot to me to win this case—especially because it would help other elderly people,” she said in a statement provided by the PLF.
Martin said the county was able to take $25,000 of Tyler’s money “that rightfully belongs to her … and the 8th Circuit said that was perfectly fine, and that any property rights that existed in that equity were abrogated by the Minnesota Legislature.”
The seizure of the funds was not a punishment within the meaning of the Excessive Fines Clause of the Eighth Amendment, the circuit court held, Martin told The Epoch Times in an interview.
The Epoch Times reached out for comment to Hennepin County but did not receive an immediate reply.
PLF currently has two other home equity theft-related petitions from homeowners—both in Nebraska—pending before the Supreme Court. One is Fair v. Continental Resources, court file 22-160, and the other is Nieveen v. Tax 106, court file 22-237.
Yet another reason to end property taxation.
At the very least, do as Colorado does, and end it for seniors.
I am inclined to agree.
Lets use an extreme example
1 million dollar home, $1 owed in taxes
for some unknown reason homeowner refuses to pay the $1, is warned over many years but still refuses.
I think it would be wrong for the government to seize the home sell it for 1 million and then keep the 1 million because $1 was owed.
I think a lien would be the best option that would be collected upon the sale or transfer of the property upon the owners death.
Definitely hope this woman prevails. And I’d like to know who was the hooked up insider who got this place at the bargain basement price of 40K, because I’m sure there must be one.
Does anyone have a list of the twelve states that allow this?
Bloated, expensive, un-reformable, bankrupt state governments are going to be stealing A LOT more citizens’ property in the coming years.
MAGA plaintiff? Case dismissed; sucks to be you.
Anyone who does not sell a house before tax foreclosure is an idiot
They may indeed usually be “idiots”—in some cases because they are senile and don’t have anyone to assist them with their financial affairs.
It can also happen with absentee owners who do not get the forwarded mail.
In the real world all kinds of strange things can (and do) happen.
If you have ever had to manage an estate you find all kinds of wacko situations with localities, banks, insurance companies, vendors etc etc etc.
It’s called a ‘tax overage’. The homeowner has a time limit by statute to request additional monies the county got, above taxes owed.
There are business that do this for homeowners all day.
Well isn’t that nice of them. SHE’S 94 years old for Pete’s sake. Is the U.S. Government really THAT greedy? If they are, it’s time for We the People to shut that bass turd down! We’ve got millions of freeloading, illegal alien foreigners partying in America and we’re picking up the tab for their party. It’s time for this crap to stop!!!
Thanks James, just what I needed!
This stuff has been going on for a long time, back to the Civil War. During reconstruction in the south the state governments, which were controlled by the north, would jack up property taxes in order to seize landowners property and redistribute it to their yankee cronies. My great-grandfather traded 120 acres for a shotgun because he couldn’t pay the taxes & it was about to be seized. Nothing more than legalized theft.
“At the very least, do as Colorado does, and end it for seniors.
Only 50% of the first $200k.
New York is one state...surprise surprise, when the county sells a foreclosed property,the mineral and gas rights stay with the county.....
An aspect of “Gone With the Wind”.
Wow, IL, MN & MA have made a lot of money seizing property and selling it for back taxes.
It appears that in the other states it is much more rare. Especially in Maine.
Very good. This may turn out to be one of those unanimous USSC decisions. The leftist justices will vote in favor of an old black woman, and the conservative justices will vote in favor of upholding the constitution.
I don’t, but I know that here in Texas homeowners over age 65 can set aside their taxes without penalty or interest. That is they can defer them until they either die or they sell the property. Once one of those two conditions occur the state swoops in and immediately demands full payment of all unpaid taxes.
In this case, I am completely mystified. Why didn’t Mrs. Tyler sell her condo? Why didn’t she rent her condo?
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.