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Committee approves bill clarifying municipal lien, notice and demolition procedures
Summary
The Senate Revenue & Tax Committee voted to pass House Bill 1695 as amended, revising municipal lien timeframes, adding notice requirements for existing lienholders and removing a state‑land petition provision; public comment raised concerns about demolition without court orders and appeal effectiveness.
The Senate Revenue & Tax Committee approved House Bill 1695, as amended, updating municipal foreclosure and lien procedures and clarifying how counties and cities report certain financial information.
Senator Steve Crowell presented the bill and John Wilkerson, general counsel for the Arkansas Municipal League, outlined a weekend negotiation that produced the amendment. Wilkerson said the amendment rolls back proposed extensions for cities to perfect liens, requires explicit notice to existing lienholders and removes an authority that would have allowed cities to petition the Commissioner of State Lands to void a sale.
Wilkerson summarized the changes: “In the original version of the bill, we extended the time for a city to file a lien, perfect a lien, to the county clerk from 120 to 365 days in 2 instances. And in 1 instance, from 60 to 180 days... So that's the first change. Also, we have, made sure working with the bankers, banker folks that we are required to give notice to any existing lienholders.”
Committee members asked whether the amendment addressed mortgage bankers’ concerns about priority and notice. Wilkerson and sponsors said the amendment resolved those points; the priority of existing mortgage liens remains unchanged. The committee adopted the amendment on a motion by Senator Boyd with Senator Caldwell seconding.
Paul Calvert, speaking on his own behalf, urged caution and described problems he experienced with liens and the appeal process. Calvert said some enforcement actions are taken before an owner can complete an appeal and described an instance where a judge dismissed his appeal after he had paid the imposed charge: “They can tear my house down without a court order, and then you can charge me for it.” He asked the committee to delay expanding municipal authority until the current process is improved.
Sponsors said the bill creates a formal foreclosure process for municipalities that previously lacked consistent procedure, and they cited an attorney general opinion and other research supporting the approach. After discussion, Senator Crowell made the motion to pass as amended; Senator Caldwell seconded. The committee approved the bill on a voice vote.
The enacted amendment specifically: (1) retains original shorter timeframes for cities to perfect liens rather than extending them to 365 days; (2) requires notice to existing lienholders before municipal foreclosure actions; and (3) removes the provision allowing petitions to the Commissioner of State Lands to void a sale. Supporters told the committee these changes resolved objections raised by municipal officials, bankers and other stakeholders.
