The Adjudicated Property Process

1. The Adjudicated Property Process Presented and Prepared by the East Baton Rouge Parish Attorney’s Office and Larry D. Book, Special Assistant to the Parish Attorney and Sydney Bankston, Assistant

2. WHAT IS ADJUDICATED PROPERTY? • It is immovable property on which the property taxes were not paid and which was not bought by an individual at the subsequent tax sale. • If no one buys the property at this tax sale, state law requires that it be “adjudicated” to the Parish. • The tax sale usually takes place in East Baton Rouge Parish in May or June of each year and the adjudication is usually recorded in the conveyance records of the Clerk of Court in July or August.

3. Once the property is adjudicated to the Parish, it will not come up for another tax sale. It can only be redeemed (which will place the property back in the name of the tax debtor), sold by the Parish through the abandoned adjudicated process or declared needed by the Parish for a public purpose.

4. ARE ALL 6,000 ADJUDICATED PROPERTIES AVAILABLE FOR PURCHASE? • IN ORDER TO BE PURCHASED UNDER THIS PROCESS: • The property must be abandoned. La. Revised Statues Title 33, Sec. 4720.12. States that "Abandoned property" means immovable property that has been adjudicated to a political subdivision for nonpayment of taxes, and which property is vacant or not lawfully occupied. The term "vacant or not lawfully occupied" shall include but not be limited to any premises which is not actually occupied by its owner, lessee, or other invitee, and has been left unsecured or inadequately secured from unauthorized entry to the extent that the premises may be entered and utilized by vagrants or other uninvited persons as a place of harborage or any premises which by reason of dilapidation, deterioration, state of disrepair, or other such status is otherwise detrimental to or endangers public safety, health, or welfare. • The date the adjudication is recorded must be after1974. • The Metrocouncil must declare the property surplus (not needed for a public purpose).

5. NOT REQUIRED, BUT STRONGLY SUGGESTED • Do not start the process unless your time limits will allow you to complete the purchase at least three (3) years after the recordation of the adjudication to the Parish because the tax debtor has a constitutional right to redeem the property for three (3) years. • Do not commence this process if you are the tax debtor, his heir or assign because the sale will be treated as a redemption and all of the taxes, liens and judgments will still be owed.

6. ADVANTAGES OF THIS PROCESS • It provides a procedure to sell abandoned adjudicated property where often the owners cannot be located and/or the amount of taxes, liens, judgments and mortgages exceed the value of the property. • Once a party with an ownership or secured interest is notified that the adjudicated property has been approved for sale, that party must redeem the property and pay certain other fees prior to the recordation of the sale. Failure to do so makes those ownership and security interests unenforceable.

7. This procedure has been approved by title insurance companies and agents allowing the new owner to acquire title insurance which is a requirement of almost all mortgage companies and which will insure the new owner that the title to the property can be defended and will be approved in the future if he tries to sell same. • Does not require the purchaser to pay the purchase price until his attorney and/or title company has approved the title. No specific performance requirements and you can back out at any time prior to closing, but you will only get your deposit back if someone else bids or property is redeemed.

8. DISADVANTAGES OF THIS PROCESS • Not recommended that the sale be completed until three (3) years after adjudication is recorded. • Because of built in advertisement delays and notification requirements, the process will probably take six (6) months to a year to complete. During these delays, the property can deteriorate and is often subject to vandalism.

9. Most attorneys are not familiar with the process and will probably charge higher than normal fees to complete the title examination and the compilation of the list of names and addresses for notification. • Many title insurance companies are unwilling to write title insurance based on this process because the value of the property does not generate a large enough premium for the added work and exposure. Some are requiring that Tax Title and Services, LLC be used, which increases the closing costs.

10. Step # 1 • Locate a property on the adjudicated tax roll that interest you. • Copies of the adjudicated tax roll are located at all East Baton Rouge Parish Libraries, the Assessor’s Office, and the Clerk of Court’s Office. • The properties are listed first by subdivision alphabetically and then by square and lot.

11. Brian Wilson, the new Assessor, has agreed to provide this same information to our web site, and we hope to have it available in near future. • There is also an adjudicated tax roll that is listed alphabetically by tax debtor and tax ward, but only recommend using this if you already know the tax debtor’s name for the property you are interested in. This roll is only located at the assessor’s office. You may also view adjudicated property online at www.brgov.com/adjudicated .

12. ADJUDICATED ROLL

13. Step # 2 • Once you have selected a parcel of adjudicated property: • Secure the municipal address from either the Maps & House Numbering Section of the Department of Public Works (389-3221 or 3314) or the Clerk of Courts’ Public Information Department (389-8312). You will need to know the legal description – Subdivision and lot and block

14. Make a visual inspection to determine if the property is vacant or has a residence or a business located on same • Try to determine if the property is abandoned or being used (electrical meter, yard, cars, toys, window fixtures, etc.)

15. Step # 3 • Obtain a request form along with the informational packet from www.brgov.com/adjudicated or the Parish Attorney’s Office of East Baton Rouge (222 St. Louis St, ROOM 902). • Fill out the request form using the information obtained from the adjudicated roll, the Clerk of Court’s Office and DPW’s Map & House Numbering Section. Not all properties have been assigned a municipal address.

16. Return the form to the Parish Attorney’s office along with a check for $75.00 made payable to the Parish of EBR to: Parish Atty’s Office, “Property Section” at: P.O. Box 1471, Baton Rouge, Louisiana 70821.

17. Request Form

18. Step # 4 • Your $75.00 fee covers preliminary research that must be done on the property, the opening of the file and DPW’s inspection of property and its recommendation as to whether the property appears abandoned and should be declared surplus. • DPW will post sign and photograph property at this time. • DPW will report in writing to our office indicating the condition and status of the property.

19. Step # 5 • We will advise you in writing of DPW’s report and whether a neighborhood average will be used or an appraisal will be required. We will attempt to use a neighborhood average whenever the property is unimproved, standard sized and we have sufficient appraisals and sales of adjudicated surplus property in the neighborhood.

20. If an appraisal is required, the fees are $150 for vacant lots; $250 for lots with a structure; and $350 for commercial and/or acreage. Certified check or money order is required. • Once appraisal money is received we assign an appraiser to the property and request his report within fifteen (15) days.

21. Step # 6 • Once we have received the appraisal we send the initial inquirer a response letter with the appraised value, the amount of taxes, interest, penalties, condemnation liens, and weed liens owed on the property. We will provide the Council members this same information when you submit your offer.

22. In this response we enclose an offer form and request an offer. The offer does not need to be based on the appraised value and/or the taxes, governmental liens, etc., but the Metrocouncil can only accept the highest offer, and may reject all offers if they believe it to be insufficient. • If we do not receive a response within two weeks, we will then provide this same information to anyone who has inquired about the property.

23. Offer Form

26. Step # 7 • Once an offer has been received, we will introduce an ordinance, which will then be set for consideration by the Finance & Executive Committee and then for final approval or denial by the Metrocouncil. • Our office will attempt at this time to notify all parties who have inquired about this property of the appraised value, the taxes, liens, etc., your offer, the anticipated Finance and Executive Committee date and time, and supply them with an offer form.

27. It is the responsibility of all parties who have submitted an offer on adjudicated property to determine the date and time of the Finance & Executive Committee meeting at which further bidding may take place. This information, the legal description, the municipal address, and the deposit and minimum bid amounts are advertised once a week for three week prior to this meeting in the Public Notice section of the Advocate. The same information can also be obtained by examining the Council and Committee agendas located at Baton Rouge’s web site, or by calling the property section of the Parish Attorney’s Office. It is necessary that you attend the Finance and Executive Committee Meeting! The Bidding Session follows this meeting.

28. Step # 8 • At this point in the process, and up until the start of the Finance & Executive Committee meeting, anyone may also submit an offer upon an approved form if they bid an amount equal to or higher than the advertised offer and attach a deposit (certified check or money order) equal to the amount advanced to date in the process. Again, the amount of the deposit, the minimum bid amount, and the date of the bidding session is found in The Advocate’s Public Notice Section.

29. Finance & Executive Committee meetings are normally held the first and third Wednesday of each month and start at 4:00 on the first Wednesday and at 4:30 on the third Wednesday. The adjudicated property items or normally the last items on the agenda, and any parcel that has one or more bids will require verbal bidding after the meeting adjourns.

30. Public Notice- The Advocate

31. Step # 9 • If our office has received more than one qualified bid and deposit prior to the start of the Finance and Executive Meeting, this office will advise the council members of this fact and ask that the matter be sent to the Metro Council without a recommendation so that we may take additional verbal bids from the qualified bidders after adjournment. All bids must be received by the Property Section prior to the start of the meeting. After the meeting the public bidding session will begin. The bidders and their bids will be announced, and verbal bidding will then commence and continue until a high bid is reached. • IT IS VERY IMPORTANT THAT EVERYONE WHO WANTS TO BID BE PRESENT AT THE MEETING!

32. Step # 10 • The following Wednesday the high bid will be reported to the Metrocouncil, which will then accept or reject the bids and , if accepted declare the property surplus. If approved, our office will mail you a copy of the adopted ordinance with further instructions. • Anyone who was not the high bidder will receive their deposit back.

33. Step #11 • The high bidder or his agent/attorney must make a thorough examination of the public records to determine what parties have an ownership or secured interest in the property. • Once these parties are identified you must go further and determine if these parties have a current address where notice can be sent. Search public records that do not pertain to this particular piece of property, phone books, city directories, Secretary of State’s Office, and the internet.

34. You must certify in writing on our form within 30 day of the adoptions of the ordinance, to our office the names and addresses of the interested parties and whether each is to be notified by mail and/or publication. Our form is required because it contains an indemnification and hold harmless clause by the purchaser in favor of the Parish if the purchaser should fail to request notification to an interested party or should incorrectly identify or locate any interested party.

35. You should return the completed form to our office with $5.00 for every name and address and $30.00 for a publication. You may put as many names in the publication as you feel necessary. This funds should be in the form of certified check or money order only. Upon receipt our office will attempt the requested notification. • Some attorneys prefer to prepare and record their own notifications, and this is permissible so long as they and you provide us with the same hold harmless and indemnification letter.

36. Interested Party List

39. Step # 12 • For at least 60 days from the date of last publication or the date of receipt of mailed notification and until the sale is recorded, any of these interested parties or their heirs or assigns has the right to redeem the property and to terminate your right to purchase the property by: (1) paying to the Property Section the funds you have advanced to our office and all condemnation, weed, paving and sewage liens and (2) paying all taxes, penalties and interest due to the Sheriff. If they do not pay our office first and secure a letter certifying that these sums have been paid, the Sheriff’s office will not let the property be redeemed.

40. You are required to record the proofs of notification or attempted notification in the Clerk of Courts Office prior to closing. After recordation, no new notifications are required of any party who may acquire an interest from the party identified in the notification. • It is your responsibility to contact our office and schedule a date and time to close after the 60 day delay period and prior to the 6 month time limit imposed by the ordinance. Do not wait till the day before the last day and call because we have to secure the Mayor’s signature prior to the closing.

41. Step #13 • Our office will prepare the non-warranty cash sale. • You should arrive on time for your closing appointment and bring a certified check or money order in the amount approved by the Council. • Prior to closing you will be required to certify that you have checked with the Sheriff’s Office and verified that the property has not been redeemed and that the necessary delays have elapsed.

42. Immediately after the sale is executed you must record the sale in the Clerk of Court’s Office. This cost usually varies from $100.00 - $350.00. You will have to pay the cost of the recordation separately to the Clerk. You are required to bring us a stamped copy of the recorded sale so that we can notify the Sheriff and Assessor of the adjudicated property sale.

43. DO IT YOURSELF, TITLE OPINION LETTER OR TITLE INSURANCE ? • The Parish sells you the property without warranty of title, even as to return of the purchase price. • If you do the research yourself, you have no one to go against if someone challenges your title. • If you hire an attorney and only receive a title opinion letter, that attorney will be obligated to defend his opinion letter for three years or ten years if he does not know how to properly word a title opinion letter.

44. If you purchase an owner’s title insurance policy that title company is then obligated to defend your title at the time of issuance, even if challenged after you sell the property.

45. SELF, ATTORNEY OR INSURANCE CONTINUED • Either you or your attorney must make the determination of whether the title is good or “merchantable.” This will depend almost entirely on the sufficiency of identification and notification of the parties who have an ownership or secured interest in the property.

46. If further notice or even a waiver may be required. • you fail to properly notify a party prior to closing, you have probably deprived that party of his interest without “due process” of the law. Notice after the sale will not cure this, and even if that party never asserts his claim, you have created a “cloud on the title” which may prevent you from being able to obtain title insurance in the future which is normally required if you mortgage the property, and sometimes if you sell the property. • If the I.R.S. or the F.D.I.C is a secured party

47. SELF, ATTORNEY OR INSURANCE COSTS • You must value your own time. Some parcels will require more research than others. • Costs of notifications and recordings will be the same (assuming your research would identify and locate the same parties). • Attorney’s fees will vary. $1,200 to $1,800 packaged deals are common.

48. Title insurance rates are set by the State of Louisiana and are based on a minimum rate of $58.00 up to $12,000 in coverage plus $4.50 for every $1,000.00 above that. This is in addition to what you are paying in attorney’s fees and recording fees. • Some title companies are only willing to write title insurance if coinsured by Tax Title Services. Not title insurance and these charges not regulated by State