Millis treasurer outlines post‑Tyler changes to tax taking and foreclosure process

Town Treasurer and Collector Jennifer Scannell gave the Select Board a detailed briefing Sept. 29 on Millis’s tax taking and foreclosure process, changes to Massachusetts law following a recent U.S. Supreme Court decision, and the operational and budgetary impacts for the town.

Scannell told the board the U.S. Supreme Court decision in Tyler v. Hennepin County requires municipalities to return excess equity from tax foreclosures to former property owners, rather than retain surplus proceeds. That ruling and related changes have prompted updates to Mass. Gen. Laws chapter 60 and new administrative requirements for tax takings, she said.

What changed: Scannell summarized several significant modifications affecting local collections: - A municipality must now wait 12 months after recording an instrument of taking before filing a foreclosure petition (previously six months). - Interest on balances placed in tax title accounts was reduced; Scannell described a decrease from the prior 16% rate to a lower rate for accounts placed in tax title after Nov. 1, 2024. - Sale proceeds in foreclosure now produce “excess equity” that generally must be returned to former owners; if owners cannot be located, unclaimed funds may ultimately be turned over to the Commonwealth under Chapter 200A. - Expanded notice and procedural steps: sending additional state forms with demand notices (Scannell cited state form 6016) and hiring a constable to post intent‑to‑take notices (form 6053) for residential properties. Municipalities must list properties with a real estate broker before offering them for sale; only after a year on the market may a town use an auctioneer to sell at two‑thirds of appraised highest and best use value.

Local context and numbers: Scannell said the town sends roughly 3,400 tax bills per quarter and that less than 2% of accounts are in tax taking. She provided parcel counts and debt ranges: 37 parcels owe $10,000 or less, seven parcels owe between $10,000 and $50,000, and 12 parcels owe over $50,000. Scannell reported a principal outstanding balance of about $744,000 across delinquent accounts and that there are 56 parcels currently in tax title. She estimated the cost to pursue a single foreclosure at roughly $2,500–$5,000 plus staff time; the town’s annual tax title budget is about $4,700.

Operational implications and options: Because the elimination of excess equity reduced the commercial viability of third‑party tax‑title assignment auctions, Scannell said some firms that previously bought tax liens have shifted to a contingency collection model. One vendor described would perform legal and economic reviews, attempt outreach, and collect delinquent balances for a fee commonly cited at 10% of recoveries. Scannell recommended exploring that model as an alternative to town‑counsel‑led work, which can generate hourly legal bills and staff time.

Board and staff comments: Select Board members and the town administrator stressed a preference to work with residents—offering payment plans where possible—and said foreclosures are a last resort. The board agreed in principle to let staff pursue additional information from collection vendors and to assess feasibility and cost. No final decision to foreclose was taken; Scannell said the town’s 2013 foreclosure guidelines generally call for placing properties in tax title 18 months after the fiscal year in which taxes became delinquent and for the Select Board to consider the top three indebted parcels when initiating foreclosure.

Ending: Scannell said she would provide the town administrator and board updated lists of delinquent parcels and additional vendor information for the board to consider in coming weeks.