[See major update for this story at bottom of page]
ALIQUIPPA, Pennsylvania - Part of the "American Dream" to many of us is home ownership. They are losing their property all too often because of heartless, insensitive laws made by uncaring politicians or county officials.
It's getting more expensive to live in America and when you retire, you had better have enough to pay you property taxes because the county will take it. Much, if not most of Forest Park in the Tualatin Mountains had been owned by people who could not pay their taxes, seized and given to the city of Portland.
Land of the free.
Even if you pay off your mortgage in full, own your home outright, you can easily lose it to money hungry county officials and uncaring judges, a lurid, evil and all too often senseless act that destroys the lives of citizens. Your home is paid in full but because of property taxes, the annual tax, quite often paid monthly, makes it seem as though you're renting. Miss a tax payment and you can end up losing your home.
A woman who lost her husband to stomach cancer also lost her home she struggled to pay after her husband's death. Judge C. Gus Kwidis refused help, saying that the widow had been given notice before her $280,000 house was sold at a tax auction over a simple $6.30 unpaid interest charge. Note that the $6.30 was not part of the property tax but just interest charged on a bill that had already been paid but was a little late in getting to city hall in the mail.
Beaver County Common Pleas Judge Gus Kwidis ruled that Eileen Battisti, of Aliquippa, was properly notified about the September 2011 tax sale of her home, which was valued at about $280,000 and sold at auction for $116,000.
The dispute involves school district taxes, penalties and interest for 2008, which Battisti paid in early May 2009. But because her payment was six days late, an additional interest payment of $6.30 was added. Battisti said she was never notified of the overdue interest after country tax authorities credited her account.
What evil lurks in the heart of man?
Mrs. Battisti, who said later she found out about the sale only when someone contacted her two weeks later. She filed an objection to the sale within the required 30-day time period, in an effort to undo the sale. But the basis of her objection was that she had not been given proper notice of the outstanding debt or the pending sale. The judge found otherwise.
Two certified letters were returned as 'undeliverable', but at least two first-class letters sent by the tax claim bureau were not returned.
Battisti's problem originated from the fact that she had paid off the mortgage on her large brick home in Aliquippa, with the money from her husband's life insurance policy after he died from stomach cancer in 2004. "This was his final wish," says Battisti. "He wanted to be sure that the three children and I would always have a place to live."
Her property taxes had always been paid along with her mortgage. But the mortgage was all paid so the usual payment for property taxes now fell on Battisti. There was no one to send her a monthly reminder.
Battisti says she didn't know about the outstanding balance on her home because the bills she received from the county tax office made no mention of it. "I paid what I was told I owed them," she said.
Penalties began to multiply. When her home was sold, the Tax Claim Bureau of Beaver County said she was delinquent $234.72.
Eileen Battisti and her husband, Anthony Battisti, purchased the Property as their home in 1999. Anthony Battisti was responsible for managing the family's finances, including the payment of all bills and taxes. She said she never knew about the tax bill and struggled to take over the family finances after the death of her husband. She has remained in the home with two of her three children since it was sold by the Beaver County Tax Claim Bureau to S.P.
In 2010, Battisti was late again with her county tax payments. She again settled up, paying interest and penalty in full, but only for 2010. She still had an outstanding account balance on her account totaling $234.72: that was the $6.30 due from 2008 plus additional interest and costs. That amount remained unpaid.
Battisti's house was eventually sold at a sheriff's sale for nearly $120,000 in order to satisfy the unpaid balance from 2008. After taxes and costs deducted from the sale, Battisti was entitled to $108,039 of the proceeds. That wasn't what Battisti wanted. She does not want the money, she says: she merely wants to keep the house where she has lived for the past 15 years, now worth about $280,000. Apparently, she has the option to do that if she can scramble together a quarter of a million dollars. Battisti claims that the man who bought her house, S.P. Lewis, buys tax delinquent properties and sells them back to their former owners for a profit.
Unfortunately, selling homes for small tax delinquencies appears to be an upward trend. Cases like Battisti's are not uncommon, as state and municipal tax offices scramble to fill budget holes by aggressively pursuing unpaid property taxes — even if it means auctioning off homes over a few dollars.
As a result, annual tax lien sales have topped $15 billion per year, according to a report released by the National Consumer Law Center last year.
For investors, tax lien sales are nothing less than a gold mine. Big purchasers — for example, debt collectors or large retail banks — can snap up the properties at deeply discounted rates and then sell them at a ridiculous profit.
UPDATE: December 12, 2014
The higher ruling has put Judge Kwidis in his place, stating he erred, and that Beaver County officials broke a state rule when they auctioned her home, that the county Tax Claim Bureau failed to offer Eileen Battisti an installment payment plan as real estate tax law requires.
The 14-page opinion and the order Judge Mary Hannah Leavitt signed reverses the September 2011 sale of Battisti's house to S.P. Lewis of Imperial, who bought the Rosewood Drive property for $116,000, according to court records.
"It proves my point", Battisti said, "that there's something wrong in the Beaver County tax office. They're not really following through with procedure like they say they do."
Battisti said she believes that county officials improperly sold her home after failing to supply proper notifications about the sale or about the six-day late fee that led to the auction.
The $6.30 fee on her 2008 school property taxes had ballooned to $234.72 with interest and other costs by the time Lewis bought the home, a practice not seen in decades but now more common, and sometimes with judges and other offices doing favors for or with buyers for the property.
AARP helped Battisti file a brief to support her case but that her legal bills are more than $30,000.
"I've been working two jobs trying to pay legal fees," she said, adding that some supporters have helped. "I have to thank everybody who's been behind me through this."
"We are thrilled with the decision of the commonwealth court and my client cried tears of joy when she heard the news," Santillan said.
"I think when you read the opinion it is clear that the property should never have been sold," he added.
Pennsylvania Commonwealth Court Judge Mary Leavitt ruled that county tax officials failed to provide Battisti with proper notification or warning regarding the sale of her house.
"A reasonable tax claim bureau would have responded to Taxpayer's payment on the 2008 taxes with an invoice for $6.30, and it would have invoiced Taxpayer in 2010 for the 2009 shortage of $234.72," the judge wrote in her ruling.
Photo: Judge C. Gus Kwidis
Photo 2: Eileen Battisti stands outside her home in Aliquippa. Photo credit: Philip G. Pavely Tribune-Review