Baltimore City is entangled in a legal dispute after being sued by the Edmondson Community Organization (ECO) over its annual property tax sale practices. The lawsuit, championed by Maryland Legal Aid and ECO, alleges that the city's actions are predatory, unconstitutional, and disproportionately affect low-income residents, many of whom are people of color, according to CBS News Baltimore.
"Your extractive, tangled-title creating, long-term vacancy spreading, community-destroying tax sale is going to be over with this case," Jonathan Sacks said as per CBS News Baltimore. The lawsuit argues that the city benefits from these practices at the expense of its residents, with properties often being sold for pennies on the dollar, resulting in significant losses for the homeowners. Midtown-Edmondson, the neighborhood where ECO is based, reportedly has about half of its homes vacant.
Additional complaints outlined by Maryland Legal Aid include high-bid premiums, a lack of minimum bid requirements, and a single-day, closed-bid, online auction system that hampers competitive bidding and fair compensation. These practices have been said to significantly undervalue the properties sold, subsequently stripping equity and hindering the transfer of wealth through property ownership.
"The tax sale has devastated communities like ours. It is perfectly built for sophisticated investors to rip the equity out of the hands of unsuspecting low-income folks who live here", Joe Richardson, ECO president stated, according to WMAR-2 News. Despite recent adjustments to the tax sale system by Mayor Brandon Scott, including removing low-value, owner-occupied homes from the sale and buying out tax liens, the lawsuit maintains that the process continues to leave a wake of vacant houses and tangled titles.
The city's tax sale, typically held in May, contributes roughly $12 million to the budget, which Maryland Legal Aid describes as "less than three-thousandths of one percent" of the city's budget, as reported by CBS News Baltimore. While these figures might represent a nominal amount for the city, they are far from negligible for the individual residents impacted by the sale. Attempts were made to reach the mayor's office for comment, but there was no response on the pending lawsuit.
