Chapter 8.20
DELINQUENCY AND FORECLOSURE1

Sections:

8.20.010    Rates of penalty and interest – Application of payments received.

8.20.020    Tax lien – Priority.

8.20.030    Tax lien – Enforcement on real property.

8.20.040    Delinquent tax roll – Foreclosure list – Payments prior to sale.

8.20.050    Foreclosure list – Notice to lienholder.

8.20.060    Apportionment of costs.

8.20.070    Foreclosure proceeding – Automatic annual proceeding.

8.20.080    Right to file answer and defense.

8.20.090    Effect and correction of irregularity, informality, omission or other errors.

8.20.100    Judgment and decree for delinquent taxes.

8.20.110    Sale of property to the Fairbanks North Star Borough.

8.20.120    Effect of judgment and decree.

8.20.130    Foreclosure sale – Limitation on proceedings.

8.20.140    Vacation of judgment.

8.20.010 Rates of penalty and interest – Application of payments received.

A. Delinquent real property taxes shall be charged a penalty equal to one percent of the principal tax for each business day or part of a business day that the tax is unpaid up to a maximum penalty of five percent of the principal tax. A taxpayer may appeal the imposition of penalties and interest or request a waiver of the penalty as provided in FNSBC 7.04.170.

B. Interest at the rate of eight percent per year shall accrue on the principal amount of the delinquent tax from the date the installment is due until paid in full. The principal tax shall accrue simple interest and not compound interest. No interest shall accrue on the penalty itself.

C. Interest on an installment accrues, and the penalty shall be added, on the date the installment becomes delinquent until it is paid in full.

D. The borough shall apply tax payments first to the amount due for the oldest tax year, then to the next most recent year, until the most recent is paid in full. For each such year, the payment shall be applied first to interest, then to advertising fees and legal costs, then to the penalty, then to the principal tax debt. A tax payment applied erroneously may be corrected retroactively. The borough shall notify the taxpayer immediately of any such correction. (Ord. 2014-14 § 3, 2014; Ord. 2011-11 § 2, 2011; Ord. 90-011 § 2, 1990. 2004 Code § 3.32.010.)

8.20.020 Tax lien – Priority.

All general taxes levied by the borough shall be a lien upon the property assessed, and such lien shall be prior and paramount to all other liens or encumbrances against the property assessed. (2004 Code § 3.32.020.)

8.20.030 Tax lien – Enforcement on real property.

Whenever the tax on real property has not been paid when due and prior to becoming delinquent, the borough may enforce the lien of such tax by the sale of the property assessed, such sale to be made under the special proceeding hereinafter set forth and by order of the superior court for the fourth judicial district. (Ord. 2014-15 § 7, 2014. 2004 Code § 3.32.030.)

8.20.040 Delinquent tax roll – Foreclosure list – Payments prior to sale.

A. The borough assessor shall, after real property taxes become due and delinquent, make and compile a roll of all real property then subject to foreclosure. Such bill shall show therein the names of the persons appearing in the latest tax roll as the respective owners of the tax delinquent property, a description of each such property as it appears on the latest tax roll, the year or years for which taxes are delinquent, the amount of delinquent taxes for each year and penalty and interest accruing thereon as of the day three months after the day of delinquency of taxes of the latest year. Delinquent special assessments for improvements may be included with delinquent general taxes in the same foreclosure list hereinafter provided for, but when so included each shall be stated separately and the penalties and interest due on each shall, in like manner, also be stated separately. There shall be endorsed on each delinquent tax roll a certificate under the hand of the borough clerk and the seal of the Fairbanks North Star Borough to the effect that the roll is a true and correct roll of the delinquent taxes of the Fairbanks North Star Borough for the years therein shown. The roll so prepared shall be known as the foreclosure list of the Fairbanks North Star Borough for the year in which the same is made up, shall be filed with the borough clerk, and shall remain open to inspection by the public. The borough assessor or other official designated by the borough assembly shall, under the direction of the assembly, cause to be published in a newspaper of general circulation in the Fairbanks North Star Borough as designated by the assembly, a notice under the hand of the borough clerk and setting forth that the foreclosure list of the Fairbanks North Star Borough for that year has been completed and is open for inspection at the office of the borough clerk, and that on a certain day, not less than 30 days after the publication of notice, the foreclosure list will be presented to the superior court of the fourth judicial district for judgment and for an order of sale.

B. On the day designated in the publication, a certified copy of the foreclosure list together with a petition for judgment shall be presented to the court. Notice of such foreclosure proceeding shall be given by four consecutive weekly publications of the foreclosure list in a newspaper of general circulation in the Fairbanks North Star Borough, to be designated by the assembly; the first such publication to be made within seven calendar days of the filing of the list and petition. The price charged for such publications shall be at the legal rate as provided by law. Within 10 days after the first publication, the borough shall send by certified mail, return receipt requested, to all persons listed on the foreclosure list notice of the foreclosure proceedings. Notice and publication of the foreclosure list in the foregoing manner shall be deemed to be sufficient service on each person interested in any of the properties therein mentioned. All persons owning or claiming to own, or having or claiming to have any interest in, any of the subject property included in the foreclosure list are charged with notice of such proceeding and of all steps taken thereunder.

C. During the time of the publications of the foreclosure list and up to the time of sale, any person may make payment on any piece of property set forth therein, together with the penalty and interest due thereon and a proportionate share of the costs of publication and foreclosure, and upon such happening the borough clerk shall make a proper notation of such payment on both the original delinquent tax roll and the foreclosure list. Upon receipt of the delinquent tax payments as to a particular property, at any time not less than one week prior to the filing of the foreclosure list and petition, the borough clerk shall cause the property to be removed from both the foreclosure list and the petition. (Ord. 2017-69 § 2, 2018; Ord. 85-054 §§ 4, 5, 1985. 2004 Code § 3.32.040.)

8.20.050 Foreclosure list – Notice to lienholder.

A mortgagee or other holder of a perfected lien on real property may file with the borough clerk a request that notice of any foreclosure list including such real property be given to such mortgagee, or other lienholder. The request shall contain the name and address of the person filing it, the description of the property, and the name of the owner or reputed owner thereof, and the date of expiration of the mortgage or lien. Notice need not be given after expiration of the mortgage or lien, unless a further request therefor is filed. If the mortgagee or lienholder furnishes a duplicate form of request for the notice, the borough clerk shall certify thereon to the filing and return the duplicate to the person making the request. Whenever any property described in the request for notice is included in a foreclosure list the borough clerk shall send by certified mail written notice thereof to the mortgagee or other lienholder. At the time of mailing the notice, the clerk shall note that fact in ink in the latest tax roll opposite the description of the property. The notice in the tax roll shall be prima facie evidence that the notice was mailed. Where the same mortgagee has filed requests on two or more properties included in a foreclosure list, one notice may be issued covering all such properties. (Ord. 85-054 § 6, 1985. 2004 Code § 3.32.050.)

8.20.060 Apportionment of costs.

The costs of the foreclosure list publication, and of the tax foreclosure proceedings, shall be apportioned among the several properties ordered sold so that each property will bear its proportionate share of such costs. (Ord. 85-054 § 7, 1985. 2004 Code § 3.32.060.)

8.20.070 Foreclosure proceeding – Automatic annual proceeding.

A. One general proceeding shall be brought on the part of the Fairbanks North Star Borough to foreclose the tax liens against each of the properties included in the foreclosure list. The person whose name appears in the latest tax roll as the owner of any property therein described shall be considered and treated as the owner of the property. Each such proceeding shall be a proceeding in rem against the property itself. If in any tax roll it appears that the owner of any property is unknown, then such property shall be proceeded against as belonging to an unknown owner.

B. The senior revenue agent for the tax year 1964, and the treasury/budget division for every year thereafter, is authorized and directed to automatically proceed after real property taxes and special assessments become delinquent to make up a foreclosure roll, as provided by pertinent state law, Chapters 8.04 through 8.28 and 19.16 FNSBC. After the roll has been prepared and all statutory provisions have been complied with, the same shall be filed with the borough clerk and open to public inspection as provided by law. The treasury/budget division shall then cause all necessary publications, postings of notices and court proceedings in connection therewith to be done in accordance with law. (Ord. 2014-15 § 8, 2014. 2004 Code § 3.32.070.)

8.20.080 Right to file answer and defense.

Within 30 days after the date of the last publication of the foreclosure list, any person owning or having any legal or equitable interest in or a lien upon any tract listed in the foreclosure list may file an answer and defense to the petition for judgment and decree. Such answer shall be in writing and specify the grounds of objection to the assessment or tax on the particular tract described in such answer and the court, in a summary manner, will hear and determine such objection and render such decision thereon as may be legal and just. At such hearing, the foreclosure list shall be prima facie evidence of the regularity and legality of the assessment and levy of the tax and that the same is unpaid, and no objection to the manner of the assessment and levy of the tax, or any of the subsequent proceedings shall be entertained by the court which does not affect the substantial rights of the party interposing the objection. (Ord. 2016-40 § 54, 2016. 2004 Code § 3.32.080.)

8.20.090 Effect and correction of irregularity, informality, omission or other errors.

A. No assessment of property or charge for taxes shall be considered invalid because of the following:

1. An irregularity in an assessment roll;

2. An assessment roll not having been made, completed or returned within the time prescribed by law;

3. The property having been listed or changed in an assessment or tax roll without any name, or with a name other than that of the owner.

B. No error or informality on the part of any officer in connection with assessment, equalization, levy or collection shall vitiate or affect the assessment of the property or the taxes thereon. (2004 Code § 3.32.090.)

8.20.100 Judgment and decree for delinquent taxes.

Not less than 30 days after the filing of a petition for judgment and decree, the court shall give judgment and decree for the delinquent taxes, penalty and interest appearing to be due on the several properties described in the petition, and shall decree that the several liens of such taxes be foreclosed. The judgment shall be a several judgment against and a lien on each property included therein. The several judgment shall bear interest at the rate of eight percent per year on the delinquent taxes, and not on accrued interest and penalties, from the date of the entry thereof. (Ord. 85-054 § 8, 1985. 2004 Code § 3.32.100.)

8.20.110 Sale of property to the Fairbanks North Star Borough.

The court shall order that the several properties, against which the judgment and decree is entered, shall be sold directly to the borough for the respective amounts of taxes and interest for which the properties severally are liable. In the event answers have been filed, the court may enter judgment against and order the sale of all other properties pending the determination of the subjects in controversy. The clerk of the court shall deliver to the borough clerk a certified copy of the judgment and decree, included in which shall be a list of the property so ordered sold with the several amounts due thereon. The certified copy shall constitute a certificate or bill of sale to the borough of the several properties described in the judgment and decree, no other certificate or bill need be issued, and the judgment or decree shall so state. (Ord. 85-054 § 8, 1985. 2004 Code § 3.32.110.)

8.20.120 Effect of judgment and decree.

Any judgment and decree for the sale of real property to the borough, on foreclosure for delinquent taxes, is conclusive evidence of its regularity and validity in all collateral proceedings, except where the taxes have been paid or the property was not liable to assessment and taxation. The judgment and decree is prima facie evidence that the taxes have not been paid and the property was subject to taxation at the time it was assessed. The judgment and decree shall stop all persons raising objections thereto, or to the title based thereon, which existed at or before the date of the judgment and decree and could have been presented as an objection or defense to the application for the judgment and decree. (2004 Code § 3.32.120.)

8.20.130 Foreclosure sale – Limitation on proceedings.

Every action, suit or proceeding commenced for the purpose of determining the validity of a sale of real property on foreclosure for delinquent taxes, or to quiet title against such sale, or to remove the cloud thereof, or to recover possession of the property, shall be commenced within two years from the date of the deed to the borough and not otherwise. In every such action, suit or proceeding, any person claiming to be the owner of the property, as against the borough, or any person holding title from the borough shall pay into court with the first pleading the amount charged against the property in the judgment and decree of foreclosure, together with interest thereon at the rate of eight percent per year from the date of the judgment and decree to the date of filing the pleading. (Ord. 2017-69 § 3, 2018. 2004 Code § 3.32.130.)

8.20.140 Vacation of judgment.

Whenever the court vacates or sets aside a judgment and decree of foreclosure with respect to any particular property, the court shall determine the value of any improvements placed on the property by the borough or by any purchaser from the borough and shall give judgment thereof and collect the same from claimant before putting him in possession. (Ord. 85-054 § 9, 1985. 2004 Code § 3.32.140.)


1

    For statutory provisions limiting the rates of penalty and interest on delinquent taxes, see AS 29.45; for provisions authorizing distraint and sale to enforce personal property tax liens, see AS 29.45; for provisions governing annual foreclosure to enforce delinquent tax liens, see AS 29.45.