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LIC-14.04 - Collections Process Administrative Rules

COLLECTIONS PROCESS ADMINISTRATIVE RULES

Adopted by the Revenue Division Director under the authority granted by Portland City Council Ordinance 189413 (passed March 6, 2019).

ARB-LIC-14.04


Section 1.0 - Purpose

The purpose of the Collections Process is to establish written rules and procedures to collect funds for a variety of City programs and to provide municipal lien account information to property owners, title companies, other city agencies and the public. To accomplish this, the following objectives were established:

•  Provide a fair, consistent, cost effective and efficient collection process that includes options for property owners experiencing difficulties in making payments.

•  Provide information and refer property owners to other agencies as appropriate.

•  Keep delinquencies to a minimum to protect the interest of bondholders and taxpayers of the City.

•  Lend support to the City's foreclosure process.

•  Provide same-day service on lien pay-off and lien information requests.

According to provisions set forth by City Charter and City Code, the collection process of the special assessments is the responsibility of the Revenue Division administered through the Assessments and Liens Section.


Section 1.1 - Authorities and Responsibilities

The Revenue Division shall maintain the records related to assessment liens, process bonding contracts, bill and collect open and bonded lien accounts, and process and approve or deny requests for Catch-up Payment Plan or Hardship Payment Plan Agreements as defined in Portland City Code Chapter 5.30.040.


Section 1.2 - Collection Process

A delinquent lien is an entry upon the City Lien Docket in favor of the City of fees, charges, penalties or assessments as authorized by state law, City Code or City Charter for which payment has not been received by the due date.

Once a City lien becomes delinquent it is the responsibility of the Assessments and Liens Section to collect the amount owed.

The purpose of special collection letters is to give the property owner notice of the delinquency, the cost of not bringing the account current, available options to help bring the account current, and awareness of the consequences of inaction.

Collection efforts will be directed to delinquent accounts in the early stages of delinquency by evenly dividing the number of delinquent accounts, on a monthly basis, among staff members.

Liens 30 - 60 Days Delinquent

a) Staff telephone property owner and document the call in the respective lien account's log note. (Lien Accounting System)

b) Staff send a collection letter – explaining the delinquency and that a $25.00 collection charge will be added to the account if payment is not received by the specified due date (due date of the current billing cycle).

Liens 61 - 90 Days Delinquent

a) Staff telephone property owner and identify the reasons why payment was not made, then ask when payment will be made. Staff explain and offer a Catch-up Payment Plan and document the call in the respective lien account's log note.

b) Staff send a second collection letter which mentions possible costs ahead and possible foreclosure.

c) A $25.00 collection charge is added to the account. Staff document mailing the letter in the respective lien account's log note.

Liens over 90 Days Delinquent

a) Staff send a third collection letter certified to property owner explaining impending foreclosure, inform customer that file is being forwarded to the Foreclosure program and the need for customer to contact Foreclosure staff immediately. Staff document mailing the letter in the respective lien account's log note.

b) A $25.00 collection charge is added to the account. Staff insert copy of the letter in the file.

The lien account is now in the foreclosure phase of the process.


Section 1.3 - Collection Exceptions

There are circumstances where the collection of delinquent accounts does not follow the collection process established under Section 1.2.

1. Bankruptcy Accounts: While the property owner is under bankruptcy protection the City cannot collect the amount owed; therefore, the lien will be set to a "No Bill" status until the case is discharged or dismissed by the court.

2. Foreclosure Accounts: In accordance with Ordinance No. 173251, an Intergovernmental Agreement between the City or Portland and Multnomah County directs the County to pay the City the amount owing for local improvement liens when the County forecloses on a property.

3. Returned Mail: In cases where the billing statement has been returned for 3 consecutive billing cycles and attempts to locate the correct mailing address have failed, the account will be set to returned mail permanent "No Bill" status. Liens will be reviewed on a monthly basis for a new or corrected mailing address.

4. Uncollectable:

•  Liens on properties that have been transferred by Multnomah County Tax Title to non-profit community development corporations or to government agencies for public purposes.

•  Liens determined to have been placed in error, which require passage of ordinance for cancellation.

•  Liens placed against properties that are qualified as remnant.


Section 1.4 - Payment Agreements to repay delinquent liens

1. There are 2 types of payment agreements for property owners in need of financial assistance to help repay their delinquent liens: the Catch-up Payment Plan and the Hardship Payment Plan.

2. The Catch-up Payment Program allows the property owner to bring a delinquent lien current or pay in full by the end of an established period not to exceed 36 months as defined in PCC 5.30.070.

3. The Hardship Payment Program allows the property owner to pay interest and billing charges only for a period not to exceed 12 months as defined in PCC 5.30.080.


Section 1.5 - Delinquent Payment Agreement

1. As Catch-up/Hardship Payment Plan agreements become over 60 days delinquent, the Revenue Division will notify the property owner of payment plan agreement cancellation/termination.

2. The notification will specify that if payment is not made within 14 days of the date of the notification, the payment plan agreement will be cancelled/terminated and if the delinquency exceeds 365 days the file will be forwarded to Foreclosure.


Section 1.6 - Cancelled Payment Agreement

1. If a Catch-up/Hardship Payment Plan agreement has been cancelled/terminated as a result of failure, refusal, or neglect to make timely payments, as provided in the agreement, and the property owner requests to have the payment plan reinstated, there will be a one time reinstatement opportunity. After the payment agreement has been in default two consecutive times there will be no more opportunity for reinstatement.


HISTORY

Adopted by Director of Revenue Division April 12, 2019.