SB 9 — Class 1 Municipalities, enforcement of state regulations and municipal code liens, judicial in rem foreclosure, court-ordered sale of property, recovery of unpaid liens and cost of enforcement, not applicable to owner-occupied real property.

SB9 ENGROSSEDENROLLED SB9 65NR33-265NR33-3 By Senator Coleman-Madison RFD:

03-Jan-24 Page 0 SB9 EngrossedEnrolled 2Enrolled, 4An AAct, BILL3 TO BE ENTITLED AN ACT Relating to Class 1 municipalities;

A tax sale purchaser that holds a deed of purchase Page 1 SB9 Engrossed in accordance with Section 40-10-29, Code of Alabama 1975.

Page 1 SB9 Enrolled g.

The term shall apply only to those liens that arise out of a failure to comply with any of the following or from the failure to comply with a Class 1 municipality's ordinances enacted pursuant to the authority Page 2 SB9 Engrossed granted in any of the following:

Sections 11-47-117 and 11-47-118, Code of Alabama Page 2 SB9 Enrolled 1975.

Real property that is lawfully Page 3 SB9 Engrossed occupied as a principal residence of the owner of record or of a family member of a deceased individual who was the owner of record at the time of his or her death, and that is any of the following:

Page 3 SB9 Enrolled a.

9592 (6) REDEMPTION AMOUNT.

The full amount of the municipal code lien payoff for each municipal code lien on which a Class 1 municipality 95 is seeking to foreclose under this act.

Page 4 SB9 Engrossed d.

The purchaser or assignee of a tax lien certificate Page 4 SB9 Enrolled as provided in Section 40-10-187, Code of Alabama 1975.

If a tax lien has been sold by a county pursuant to Section 40-10-182, Code of Alabama 1975, then the amount Page 5 SB9 Engrossed required for redemption pursuant to Section 40-10-193, Code of Alabama 1975.

The taxes assessed against real property by either the state, the county, or a Class 1 municipality in Page 5 SB9 Enrolled which the real property is situated which are delinquent pursuant to Sections 40-11-4 or 11-51-2, Code of Alabama 1975, as of the date a proceeding under this act is commenced or at any time before final resolution of the same and shall include any taxes assessed against real property that are unpaid from any previous year and any amounts required for redemption pursuant to Sections 40-10-83, 40-10-120, 40-10-193, or 11-51-23, Code of Alabama 1975.

(c) Every municipal code lien shall be superior to all Page 6 SB9 Engrossed other liens except those liens for taxes pursuant to Section 11-51-6, Code of Alabama 1975.

(a) A Class 1 municipality may proceed with judicial in rem foreclosures of municipal code liens in Page 6 SB9 Enrolled accordance with this act by enacting an ordinance of the governing body of the Class 1 municipality where the real property is situated, which ordinance shall be sufficient authority for use of this act by the Class 1 municipality to enforce its municipal code liens.

(4) Any other matters related to code enforcement that the Class 1 municipality designates for administrative Page 7 SB9 Engrossed regulation.

(c) The provisions of a Class 1 municipality ordinance and administrative regulations issued pursuant to the ordinance shall not conflict with Sections 5 through 8 of this Page 7 SB9 Enrolled act.

Page 8 SB9 Engrossed Section 5.

(a)(1) After a municipal code lien has been recorded with the office of the judge of probate for the county in which the real property is situated, the governing body of a Class 1 municipality may identify by resolution Page 8 SB9 Enrolled those properties on which to commence a judicial in rem foreclosure pursuant to this act, provided, however, that those properties the Class 1 municipality identifies as owner-occupied shall not be subject to judicial in rem foreclosure.

Upon notification, the county tax collector shall provide the Page 9 SB9 Engrossed tax payoff amount.

(c) A Class 1 municipality shall initiate an action to foreclose a code enforcement lien pursuant to this act by filing a petition with the clerk of the circuit court for the Page 9 SB9 Enrolled judicial circuit in which the real property is situated.

Page 10 SB9 Engrossed (2) A legal description.

(5) A description of the municipal code lien that is Page 10 SB9 Enrolled being foreclosed.

Page 11 SB9 Engrossed (f)(1) A Class 1 municipality shall mail copies of the petition by both certified mail, return receipt requested, and by regular mail to all interested parties whose identities and addresses are reasonably ascertainable.

Page 11 SB9 Enrolled (2) Copies of the petition shall also be mailed by first-class mail to the real property address to the attention of the occupants of the property, if any.

Page 12 SB9 Engrossed (4) A description of any applicable municipal code lien that is being foreclosed.

Page 12 SB9 Enrolled (6) The applicable period of tax delinquency, if any.

(2) At the judicial hearing, any interested party shall have the right to be heard and to contest the delinquency of the municipal code lien, the adequacy of the proceedings, the classification of the real property as owner-occupied, and the Page 13 SB9 Engrossed amount of the tax payoff.

Page 13 SB9 Enrolled (1) The municipal code lien is delinquent.

(d) If at any point in the proceedings the court determines that the real property is owner-occupied, then the Class 1 municipality shall seek immediate dismissal of the Page 14 SB9 Engrossed proceedings.

(a) At any point prior to the conclusion of the sale described in Section 8(a), any interested party may redeem the real property from the sale by payment of the Page 14 SB9 Enrolled redemption amount.

Page 15 SB9 Engrossed (b)(1) Except as otherwise authorized by law, the minimum bid price for the sale of the real property shall be the redemption amount.

In the absence of any bid higher than the minimum Page 15 SB9 Enrolled bid price, the court or its designee shall bid in for the property on behalf of the Class 1 municipality or its designee in an amount equal to the minimum bid price, causing the Class 1 municipality to become the purchaser at the sale pursuant to Section 7.

(2) If the purchaser is the Class 1 municipality, then the Class 1 municipality shall tender to the court an amount Page 16 SB9 Engrossed equal to any costs incurred by the court that are included in the amount of the municipal code lien payoff.

(3) If the minimum bid price includes a tax payoff amount, the court shall deposit the amounts paid with the Page 16 SB9 Enrolled appropriate parties in accordance with Sections 40-5-10, 40-10-128, 40-10-129, and 40-10-193, Code of Alabama 1975, and any applicable local laws.

(g) Within 90 days following the date of the sale, the Class 1 municipality shall file a report of the sale with the clerk of the circuit court, which report shall identify Page 17 SB9 Engrossed whether a sale took place, the foreclosure sale price, and the identity of the purchaser.

Page 17 SB9 Enrolled Section 9.

Page 18 SB9 EngrossedEnrolled Senate________________________________________________ ReadPresident forand thePresiding firstOfficer timeof andthe referredSenate ................03-Jan-24________________________________________________ toSpeaker of the SenateHouse committeeof onRepresentatives CountySB9 andSenate Municipal04-Apr-24 GovernmentI Readhereby forcertify that the secondwithin timeAct andoriginated placedin ................06-Mar-24and onpassed the calendar:Senate, as amended.

0 amendments Read for the third time and passed ................04-Apr-24 as amended Yeas 24 Nays 1 Abstains 2 Patrick Harris, Secretary.