House on Unpaid Water Bills: No Liens For 1Yr, As We Study Tax Sales

The House Ways and Means Subcommittee on Revenues (who has jurisdiction over tax collection processes such as tax sales) has advanced two bills targeting the collection of unpaid water bills. The two amended bills, as passed, would impose a moratorium on using tax sales to collect water and sewer liens, and would require a multi-party study of tax sale processes to be completed this year.

The two bills being moved are:
HB 453: Bill Information | MACo testimony
HB 659: Bill Information | MACo did not take a position

In previous Conduit Street coverage (“Should ‘Good Actors’ Subsidize Bad Actions?”), MACo had raised concerns with laws limiting collection of overdue fines and charges – citing unfairness to those who have made their timely payments:

Water systems are usually set up by governments as “enterprise funds,” meaning they cover their own costs. This “user pays” principle is widely embraced for similar public services.

But if the prospect of losing service… or the potential to see your property face tax sale… is off the table, surely compliance will drop. The state’s largest water system in Baltimore City estimates that without the lien process available they could face some $7 million in reduced payments, as non-payers would no longer be eventually compelled to cover their own share of system costs.

Both bills should be reported out from the full committee and on the House floor in the days ahead, likely passing to the Senate by the Monday “crossover” procedural deadline.

Michael Sanderson

Executive Director Maryland Association of Counties
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