The Town of Hay River has set June 27 as the date for a public auction of taxable property in arrears to the municipality.
Council approved the date at its special meeting on April 10.
The town has not had a tax arrears sale since 2013, which was for arrears from 2011.
The aim of this year’s sale is to collect $248,967 in delinquent property taxes from 2016, either by encouraging property owners to pay the arrears or actually selling the property at auction.
“According to our legal advice, prior to commencement of the public auction any person including the assessed owner has to pay the full arrears property tax and all reasonable expenses incurred by the town to collect the arrears,” said Judy Goucher, senior administrative officer with the town. “Only then will the property not be offered for auction.”
Goucher noted for the first time the town is using legal counsel to undertake the process.
She said property owners will have 30 days after the public auction to clear the arrears in order to not have their properties sold.
The SAO noted the property owners have been informed of the process in a number of ways, including by registered letters.
“We want to be transparent so that people aren’t surprised and we don’t get feedback that they weren’t aware of the process,” she said.
Ruth Boden, director of finance and administration with the town, noted the minimum sale price of a property is set at 50 per cent of the assessed value.
“So if the property tax arrears is less than that, the sale price will be the minimum sale price which is 50 per cent of the assessed value,” Boden said. “If the property taxes exceed that minimum value, then we would be putting the minimum price up so that we are recovering our taxes.”
If there is any excess from the sale over and above the property taxes, the money would be distributed by the NWT Supreme Court if there are any encumbrances against the property. If the property is free and clear, the excess will go back to the registered owner.
Deputy Mayor Donna Lee Jungkind expressed concern that all property owners fully understand the rules of the auction process, and that they have to come up with the full arrears to allow their property to come off the tax arrears list.
“I don’t want us to be in a situation where we’re at the 10th hour and we’re all scrambling trying to figure this out and we have screaming property owners in our faces,” she said.
The arrears on the 40 properties on the list range from just $153 all the way up to $33,638.
The Property Assessment & Taxation Act of 1988 provides for the recovery of tax arrears by sale at public auction.