County Treasurer Obligated to Sell Tax-Foreclosed Parcel to City
In City of Bay City v. Bay County Treasurer, Michigan Court of Appeals, No. 294556, April 5, 2011, a trial court erred in finding that a county treasurer was not obligated to sell a local Michigan property tax-foreclosed parcel to a city by adding conditions on a "public purpose" that were not found within the clear and unambiguous language of the applicable statutory foreclosure scheme. Under the statute, the state of Michigan had a right of first refusal to purchase any tax-foreclosed properties in the state. If the state declined to purchase a property, the city, village, or township within whose limits the property was located was allowed to purchase it for a public purpose. The county treasurer in this case was the foreclosing governmental unit (FGU) because state law allowed counties to opt-in and replace the state as the FGU and administer foreclosures within their jurisdiction.
At trial, the county treasurer seemingly conceded that the city stated a public purpose for purchasing the tax-foreclosed parcel. The resolution passed by the city authorized it to acquire selected tax-reverted properties for the purpose of stimulating private investment through the redevelopment of property. On appeal, however, the county treasurer argued that the city's public purpose was unclear and that the statutory scheme required that the identified public purpose be capable of being efficiently and expeditiously carried out.
The Michigan Court of Appeals noted that the terms "efficiently" and "expeditiously" were not found in the applicable statute. Accordingly, the trial court should not have added restrictions and conditions into the statute on what constituted a public purpose. Furthermore, the determination of a proper purpose for the purchase of tax delinquent property was a legislative function. Because there was a mandatory statutory duty for the county treasurer to sell the property to the city, and no statutory discretion to decide not to sell the property, the county treasurer was not empowered to make an independent determination as to the municipality's professed public purpose.