2022-05 Department of Finance Real Property Tax Division Revenue Cycle Management

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list despite extensive outreach. Title companies generally view the work as high-risk-reward and low-margin. RPT has also attempted to recruit in-house abstractors who can perform title searches inhouse but has been unable to acquire the highly specialized skillset. RPT stated that while they value the title company's role in helping to demonstrate due diligence, changes in the business environment could threaten RPT's current standard operating procedures. To address the changes in the business environment, RPT must either: • Develop alternatives • Increase external capacity • Develop internal capacity Because of the challenges cited above, developing alternatives is the most achievable outcome and is mainly within the division's control. The item paramount to the issue is the notification to the taxpayer and what constitutes proper due diligence. Chapter 19 has significant variance in what constitutes reasonable due diligence and is written around specific activities. For example, the RPT administrator may require owners to produce returns to form the basis of a sound appraisal and for assessment purposes. Notification of this activity is fulfilled in section 12 by public notice through publication, compelling a response from "every person owning, or having possession, custody or control of, real property whether entitled to exemption or not." By contrast, Chapter 19 Section 16, Notices, how given. Are deemed to be sufficiently recognized according to the date on the notice and when properly mailed to the address "at the addressee's last known address or place of business." Contrasted again, Chapter 19 Section 40, par (b), (2), "If the address of the owner is known or can be ascertained by due diligence, including an abstract of title or title search, the director shall send to each owner notice of the proposed sale by registered mail, with request for return receipt. If the address of the owner is unknown, the director shall send a notice to the owner at the owner's last known address as shown on the records of the department of finance." Cause and Condition RPT's tax foreclosure procedures enumerated in Chapter 19 depend on financial constraints, title company's ability, capacity, and risk tolerance. Effect If the current title company discontinues its services in this sector, RPT cannot perform one of its core functions. Recommendation 7 Due Diligence We recommend that RPT work with the Office of Corporation Counsel to amend Chapter 19-40 and subsections, improving options to satisfy "ascertaining ownership" and "notification requirements, " assuming no third-party title company is meaningfully involved. 37 Page