Kendall pays back tax sale buyers
By Steve Lord firstname.lastname@example.org January 10, 2014 9:06AM
Updated: February 13, 2014 6:38AM
YORKVILLE — An unusual situation dating back to tax sales in 2009 and 2010 has forced the Kendall County Treasurer’s Office to borrow about $700,000 from the county’s general fund.
The County Board recently approved the transfer so Treasurer Jill Ferko can cover the cost of refunding money to 229 tax buyers from the 2009 and 2010 tax sales.
According to a court ruling, those were what is called “sales in error” — meaning the buyers were unaware of something that would make it impossible for them to take ownership of the land for which they paid back taxes.
In this case, what the tax buyers did not know was that the cities of Yorkville and Plano had liens on the property in question — vacant lots in the Windett Ridge and Raintree Village subdivisions in Yorkville and Lakewood Estates in Plano.
At a tax sale each year, the treasurer puts up property with unpaid taxes. A buyer bids a percentage, and if that buyer wins, pays the back taxes and the percentage to the county.
Paying the taxes puts a lien on the property. The original property owner can take back ownership by paying the back taxes. But after three years, if that redemption does not happen, the tax buyer can take ownership of the property.
In this case, Yorkville and Plano already had their own liens on the properties. In most cases, the cities were forced to pay for mowing high grass and weeds on the lots that were never built on. The liens were to force the property owners to pay for the mowing, if they ever wanted to develop the sites.
When the people who bought the taxes and paid them discovered they could not clear the title because of the property maintenance liens, they asked the court to declare the sales in error.
The situation could have been worse, Ferko said. In the case of Windett Ridge, Ryland Homes purchased all the vacant lots with the intent to develop them, and paid the back taxes. Otherwise, Ferko would have owed more than the $700,000.
“The solution is to borrow — and I’m using the word borrow — from the general fund,” Ferko told the County Board. “In the worst-case scenario, it will be paid back over five years.”
She said the money will be recovered by money in a bond payment fund connected to a special service area Plano has on the Lakewood Estates subdivision.