HB354 Alabama 2018 Session

Summary

Primary Sponsor

Corley EllisRepresentative

Republican

Session

Regular Session 2018

Title

Tax liens, sale authorized at auction to the bidder with the lowest interest rate, Secs. 40-10-199, 40-10-200 added; Secs. 40-10-180 to 40-10-198, inclusive, am'd.

Summary

HB 354 changes the tax lien sale system to auction tax liens to the lowest interest rate bidder and adds new rules for certificates, redemption, and private sales.

What This Bill Does

Authorizes counties to conduct tax lien auctions where the lien is sold to the bidder offering the lowest interest rate. Sets detailed rules for tax lien certificates, required notices, fees, transferability, redemption, and records, and adds provisions for private sales of unsold liens. Expands redemption and foreclosure procedures, defines how proceeds are distributed, and includes anti-corruption protections.

Who It Affects

• Property owners with unpaid real property taxes: subject to tax lien auctions and redemption rules that determine how and when they can redeem.
• Counties and tax collecting officials: must administer auctions, issue and record tax lien certificates, keep records, and oversee private sales and distributions.
• Tax lien purchasers and assignees: receive transferable tax lien certificates with specified interest, fees, and redemption rights, and may foreclose if redemption rights lapse.
• Mortgagees and other lienholders: have redemption rights and may be affected by foreclosure procedures and notices related to tax lien certificates.

Key Provisions

• Tax liens will be auctioned to the lowest interest rate bid, with a maximum initial bid rate of 12 percent and ongoing bids decreasing the rate.
• Unsold liens may be sold privately for not less than the total amount due, and such private sales must be recorded in the record of tax lien auctions and sales.
• Tax lien certificates carry a 12 percent per year interest rate (or the rate bid at sale), include required details, and are transferable with a formal endorsement and record-keeping.
• Fees: $1 to $5 certificate fee; $20 origination cost and $20 auction fee; $10 redemption fee when a lien is redeemed; notices and record-keeping requirements are specified.
• Redemption rights allow owners and certain others to redeem liens by paying the total due plus interest and applicable fees; mortgagees may add costs to loans when redeeming.
• Foreclosure of the right to redeem can be pursued after 3 to 10 years if not redeemed, with required notices to owners and other holders, and court-ordered deeds upon foreclosure.
• Proceeds from tax lien sales follow existing distribution rules for tax collections; penalties and fees go to the county general fund.
• Prohibits conflicts of interest: if a county official or their associates are involved in purchasing a tax lien, the sale is void and penalties may be imposed.

AI-generated summary using openai/gpt-5-nano on Feb 24, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Taxation