BARTON, Vt. (WCAX) – A proposed bill at the Vermont Statehouse is designed to ease property tax abatement and tax sale rules for municipalities when residents fail to pay their taxes.

The town of Barton recently seized the home of Penny Flynn, a local retired woman who moved out of state. Flynn’s daughter had moved in and fell behind on property tax payments. The town ended up seizing the $80,000 house as part of a property tax sale. Flynn received less than $7,000.

The case has turned into a legal battle over past-due tax notifications. “Our client spends time in Florida during the colder months and so that’s when these notices were being sent. They were bouncing back to the town. She didn’t get them until after the deed transferred in the 2022 tax sale,” said Greg Fox/ with Vermont Legal Aid. He filed a federal lawsuit on behalf of Flynn against the town of Barton and the village of Orleans to reclaim the property.

The municipalities say Flynn owed around $6,500 in unpaid taxes. Fox argues the village failed to compensate Flynn for the actual property value and that the sale violates the state and U.S. constitutions. “This asset that she lost was one of the most valuable assets that she had to see her through retirement It was also an asset that she was looking to have available for her family,” he said.

The lawsuit is part of a larger effort to change rules around property tax sales in the state. Rep. Emilie Kornheiser, D-Brattleboro, is the lead sponsor of a bill that attempts to change current state laws around tax abatements and sales.

“The more we can provide clear guidelines, the more we can remove bias, and the more we can make it easier for Vermonters to make these decisions on behalf of their neighbors,” Kornheiser said.

Between 2019 and 2020, 308 people lost their homes in tax sales according to data gathered by Vermont Legal Aid. They say some of those homeowners had delinquent taxes as low as $180.

“Sometimes properties going up for tax sale were just a few hundred dollars in overdue taxes, so people were losing their homes in an incredibly scarce housing market for just that little amount of overdue money,” Kornheiser said.

However, the Vermont League of Cities and Towns is concerned that the change would disincentivize residents to pay taxes. The group’s Ted Brady says tax sales are a last resort that clerks and towns use after exhausting other methods. “This is the only tool that a town has to compel somebody to pay their taxes,” he said. Brady says a shortfall in taxes shouldn’t fall on neighbors who do pay. “In a small town, when somebody fails to pay a $2,000, a $5,000, a $10,000 property tax bill, the town still has to pay that. Which means you, the neighbor, have to come up with that money.”

Neighbors of Ms. Flynn in Barton say the home her daughter was living in was dangerous to the community and that the neighborhood is safer since the town seized it.

Barton officials said they could not comment on the ongoing case. Vermont Legal Aid says they are expecting a response to the lawsuit in the coming weeks.

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