Council moves to declare 266'272 Jackson Street surplus amid new Home Equity Theft Act timelines

At the June 23 special meeting the Lawrence City Council advanced a recommendation to declare a city-owned parcel at 266'272 Jackson Street surplus and to prepare it for sale under the Home Equity Theft Act process, while city attorneys and councilors discussed options to retain the lot for municipal use.

Councilor Marmol introduced the item as a favorable committee recommendation. City Attorney Tim Hooten summarized the procedural mandates of the Home Equity Theft Act, which tightens timelines and equity accounting for tax-title properties. Hooten said municipalities must appraise property and list it for sale within statutory windows; if the property does not sell within 12 months the city may be required to auction it with a minimum acceptable bid of two-thirds of the appraised value. Any sale proceeds in excess of taxes and allowable costs would become "excess equity" that is payable to interested parties who file valid claims within an 18-month notification window.

Hooten described why the city had to move promptly on the Jackson Street parcel: courts and plaintiffs have recently challenged municipal procedures for tax-title properties, and the Home Equity Theft Act sets strict deadlines. He told the council this parcel had a deadline in mid-June for an initial procedural step and that the city needed to declare surplus to remain on schedule: "We only have a limited amount of time to decide what we're gonna do with the properties... Once it's declared surplus, we have to immediately get it appraised," he said.

Councilors asked procedural questions about realtor selection and whether the city could retain the parcel for a public purpose such as parking. Hooten said the normal practice going forward will be to issue an RFP for professional services (realtors and appraisers) and to create a vetted list of providers; he said the city cannot complete marketing or listing activities until surplus declaration and appraisal steps are complete. He also noted that if a city department wished to retain the parcel for municipal parking or other public use, that department would effectively need to fund the difference between the appraised value and the taxes owed, because under the statute the municipality must pay fair market value in cases where internal transfers or purchases occur.

Council members raised neighborhood concerns about parking near the site and requested advance notice when properties in their districts are scheduled for surplus declaration. Several councilors said they want the city to consider municipal retention where feasible, particularly in neighborhoods facing acute parking challenges. Hooten and staff said they will provide additional information, including detailed appraisals and a plan for an RFP to secure marketing and appraisal services.

Why it matters: The Home Equity Theft Act imposes timetables and equity protections that change how municipalities handle tax-title property sales. Declaring a property surplus starts the clock for appraisal and sale under those rules; the city must balance the desire to realize proceeds with neighborhood needs such as parking and affordable development.

What the council did: The council voted to advance the surplus declaration process for the Jackson Street parcel and to instruct staff to pursue the appraisal and next steps required by the Home Equity Theft Act. Councilors requested follow-up materials on appraisal, RFP timing and potential municipal uses before any final sale.