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At any time after March 1 next succeeding the date taxes are due and unpaid, payment may be enforced by sale, as provided by law. The director of finance shall make or cause to be made up a list of all taxes which are due and unpaid, which shall contain the amount thereof, the interest and penalties thereon, the property affected thereby, the name of the owner thereof as such name appears on the assessment records of the county, a brief description of the property sufficient to identify the same and such references to conveyances or other records of title as will identify the property. To such list shall be appended a notice that if taxes, penalties and interest thereon are not paid on or before the second Monday in June next ensuing, together with the expenses of sale allowable by state law, the director of finance will, commencing on the second Monday in June at an hour and place specified in such notice, offer or cause to be offered for sale to the highest bidder upon the terms provided by public general law each and every parcel of property contained in such notice. Such notice and list shall be published in accordance with the applicable provisions of the public general laws, and the last publication thereof shall appear on or before the second Monday in June. Commencing on the second Monday in June, the director of finance shall proceed to sell or cause to be sold at auction to the highest bidder all such properties upon which the taxes are due and unpaid; but no such property shall be sold for a sum less than the total amount provided by applicable public general law. In addition to the expenses of sale allowable by state law and such interest and penalties as provided for elsewhere in this chapter, the director of finance shall impose on each parcel of property published a penalty charge of twenty dollars ($20.00). (Mont. Co. Code 1965, § 2-130; 1906, ch. 171, § 62-I; 1912, ch. 790, § 137; 1931, ch. 461; 1933, ch. 541, § 207; 1935, ch. 250; 1941, ch. 916, § 199; 1982 L.M.C., ch. 39, § 4; 2016 L.M.C., ch. 7, § 2.)
Editor’s note—Pursuant to Montgomery County Council Resolution 9-1591, commencing with the tax sale of real property in June 1982 for ordinary taxes overdue, in arrears and unpaid, in accordance with the provisions of Ann. Code of Md., Tax-Property Article, §§ 14-820 and 14-828, the rate of redemption shall be the sum of the interest rate on late payment of taxes and the penalty rate on late payment of delinquent taxes as fixed by resolution of the County Council.
Section 52-25 (formerly § 52-36, 2016 L.M.C., ch. 7, § 1) is interpreted in Heartwood 88, Inc. v. Montgomery County, 156 Md. App. 333, 846 A.2d 1096 (2004).
(a) The county is hereby authorized and empowered to purchase any real estate offered for sale for the payment of taxes and special assessments; provided, it shall not bid a sum greater than the taxes and special assessments in arrears on such property and the interest and expenses of sale and costs and fees, and to sell or lease the same as shall be deemed to be in the best interests of the county. The county is authorized and empowered to issue upon its faith and credit at one time or from time to time as may be necessary, certificates of indebtedness in an amount not exceeding the amount of such taxes or special assessments, interest, penalties, costs and fees, in anticipation of the receipt of money from the redemption and from the sale of property sold for such taxes or special assessments; provided, however, that the amount of such certificates of indebtedness shall not in the aggregate at any time exceed twenty (20) percent of the total amount of taxes or special assessments levied for the year for which such certificates are issued.
(b) The certificates of indebtedness so issued in anticipation of the receipt of money from the redemption and from the sale of property sold for taxes or special assessments in any year shall be identified by the year in which such sale is made and designated “Certificates of Indebtedness, 19___,” and shall mature not later than October 1 of the fifth year after the year in which such sale for taxes or special assessment is made. Such certificates of indebtedness shall bear interest at a rate to be determined by the county executive, with the approval of the council, payable semiannually or at shorter intervals, and shall be sold in such manner and on such terms as the county executive shall determine to be for the best interests of the county, and if for any reason certificates of indebtedness issued against property purchased by the county at any tax sale have been retired in whole or in part before the time limit for maturity as specified in this section new certificates may be issued, the total principal of which shall exceed neither the amount of principal previously retired nor the amount of taxes, interest, penalties, expenses of sale, costs and fees on property purchased by the county for such year remaining unredeemed at the time of issuance of such new certificates, but all such certificates of indebtedness shall mature within the time herein limited for the maturity of the original certificates of indebtedness.
(c) The county executive shall by regulation fix the form of such certificates of indebtedness, the officers by whom they shall be executed, the amounts, the medium of payment and the place in Maryland or elsewhere at which they shall be payable. Such certificates of indebtedness may be renewed from time to time by endorsement thereon or new certificates of indebtedness may be issued from time to time for the payment of such certificates issued hereunder as may mature and all such new certificates may be issued in the same manner as herein provided not exceeding the total principle of the maturing certificates and shall mature within the time herein limited for the maturity of the original certificates of indebtedness. All money received from the redemption and from the sale of property sold for taxes or special assessments in any year shall be kept in a separate fund, identified by the year in which the sale for taxes or special assessments is made and designated as “19___ Tax Sale Fund,” and shall be applied solely to the payment of the principal and interest of certificates of indebtedness and renewals thereof or new certificates, issued in anticipation of the receipt of such money. The county may purchase or redeem before maturity any of such certificates offered.
(d) In each year in which property is sold for taxes or special assessments there shall be included in the annual tax levy an amount sufficient to pay one (1) year’s interest on all certificates of indebtedness authorized or to be authorized by the county in anticipation of the receipts of money from the redemption and from the sale of property sold for such taxes or special assessments. In each year thereafter there shall be included in the annual tax levy an amount sufficient to provide for the payment of the principal and interest of all certificates of indebtedness as the same shall fall due; provided, however, that the amount of such tax shall be reduced by the amount received into the fund which is pledged to the payment of such certificates of indebtedness. After the payment of the principal and interest of all certificates of indebtedness issued in anticipation of the receipt of money from the redemption and sale of property sold for taxes or special assessments in any year, all funds received from the sale or redemption of property sold for such taxes or special assessments shall be paid into the general fund of the county. Money received from the sale of certificates of indebtedness shall be used so far as necessary for the payment of appropriations made for the fiscal year in which the tax sale occurs or for the payment of loans or interest thereon made for the purpose of paying such appropriations. (Mont. Co. Code 1965, § 2-131; 1906, ch. 171, § 62-O; 1912, ch. 790, § 143; 1931, ch. 52; 1933, ch. 163; 1933 (Sp. Sess.), ch. 11; 1969 L.M.C., ch. 40, § 3; 2016 L.M.C., ch. 7, § 2.)
Editor’s note—Ch. 7 of 1933 (Sp. Sess.) validated all certificates of indebtedness issued pursuant to this section.
(a) On or before October 15 of each year, the county shall cause to be offered for sale at public auction all properties which it has purchased at tax sale and which are no longer subject to redemption. One (1) or more of the properties may be so offered at such other times as the county executive may determine. Each such property shall be offered at such auction at an upset price equal in amount to all taxes and assessments thereon which are due and unpaid, together with interest thereon to the date of the sale, plus all costs and penalties allowable by law, plus the cost of advertising and selling such property at auction sale. Upon a finding by the county executive that such upset price is, in the case of a particular piece of property, either too high or too low, the county executive may, by regulation fix an upset price at a figure other than that provided for in this section; provided, that such finding and the basis therefor are recited in the regulation. At any time prior to the date of any such auction the county executive may withdraw any of the properties from the sale for the purpose of
(1) Conveying properties to any governmental agency or political subdivision; or
(2) For retention for use by the county; or
(3) Whenever there was no bid equal to or greater than the upset price at a previous public auction, the county executive may dispose of the property in the manner prescribed by subsection(b) of this section.
(b) After any such property has been offered for sale at public auction one (1) or more times, it may be sold at private sale at the best price obtainable by the county executive, subject to the approval of the council. (Mont. Co. Code 1965, § 2-132; 1935, ch. 542; 1969 L.M.C., ch. 40, § 4; 2016 L.M.C., ch. 7, § 2.)
Any sale of lands by the director of finance when the owners are described as the heirs of a named person shall pass the title as fully as if such heirs were each named in the proceedings by his other proper name; and if the purchaser of any real estate sold by the director of finance for the payment of taxes shall die without having procured a deed therefor the director of finance may convey the real estate to the devisees or heirs of the purchaser. (Mont. Co. Code 1965, § 2-133; 1906, ch. 171, § 62P; 1912, ch. 790, § 144; 2016 L.M.C., ch. 7, § 2.)
ARTICLE III. REAL PROPERTY TRANSFER TAX.*
*Editor’s note—Article III (formerly Article II, 2016 L.M.C., ch. 7, § 1.) Blumenthal v. Clerk of the Circuit Court for Anne Arundel County, 278 Md. 398, 365 A.2d 279 (1976), addressed the right of the County to fix the amount of the recordation tax by ordinance adopted after adoption of enabling legislation, but prior to effective date of enabling legislation. The farmland transfer tax levied by this article (Sections 52-29 through 52-38, formerly Sections 52-19 through 52-27, 2016 L.M.C., ch. 7, § 1) is constitutional. Vournas v. Montgomery County, 300 Md. 123, 476 A.2d 705 (1984).
For the purposes of this article, the following words and phrases shall have the meaning respectively ascribed to them by this section:
(a) Consideration: Such term shall include everything of value included in the actual price paid or to be paid to a transferor or to a third party on behalf of a transferor for the property transferred, including, but not limited to, cash, bonds, stock, documents evidencing monetary value, choses in action, property either real or personal, payment by way of fees, labor or services, instruments of credit, notes, deeds of trust, mortgages, assumption of liability for debt incurred by another and cancellation of a debt. Consideration shall be presumed to be not less than the total full cash value of the property based on the most recent notice of assessment. For the purposes of the farmland transfer tax contained in Section 52-31(d), consideration for the transfer of land previously assessed as farmland shall be presumed to be not less than the total full cash value as computed by the supervisor of assessments at the request of the director of finance, as if the land were not assessed as farmland. These presumptions may be rebutted by clear and convincing evidence. The director may make a final determination of consideration pursuant to Section 52-36 of the Code.
(b) Transfer: The acts of the parties, or act or operation of law, by which:
(1) The title to property or a leasehold interest in property is conveyed from a person, firm, corporation, legal entity, or government agency to another; or
(2) Real property subject to Section 52-31 is transferred to a government agency on the assessment records and removed from the tax rolls under the laws of eminent domain.
(c) Act or operation of law: Any act by which title to or an interest in property is transferred by law, or judicial or administrative action including, but not limited to, a taking under the power of eminent domain or the acquisition of property for a public purpose. (Mont. Co. Code 1965, § 84-24; 1983 L.M.C., ch. 37, § 2; 1985 L.M.C., ch. 58, § 1; 2016 L.M.C., ch. 7, § 2.)
Editor’s note—Section 2 of 1985 L.M.C., ch. 58, which amended subsections (b) and (c) of this section, reads as follows: “Sec. 2. Scope of Act. This act applies to real property that:
(1) Is assessed on the basis of farm or agricultural use; and
(2) On or after July 1, 1984, is transferred to a government agency on the assessment records and removed from the tax rolls under the laws of eminent domain.”
(a) The county council for Montgomery County is empowered and authorized to levy and impose by resolution or ordinance a tax to be paid and collected on the transfer in Montgomery County of:
(1) Any fee simple interest in real property, except by way of mortgage, deed of trust, or deed of trust for the benefit of creditors;
(2) Stock or other evidence of ownership in a cooperative housing corporation or similar entity;
(3) Any leasehold interest in real property, where such lease contains a covenant for perpetual renewal; and
(4) Any nonresidential leasehold interest in real property where there is a simultaneous or subsequent transfer of the fee interest in the real property to:
(i) Any transferee or assignee of the leasehold; or
(ii) Any entity in which a transferee or assignee of the leasehold has any interest.
(b) The rate of such tax shall not exceed:
(1) Six percent of the value of the consideration for any transfer of land, excluding improvements thereon, that is or was assessed on the basis of being actively devoted to farm or agricultural use. The tax shall be paid by the transferor of the land. The tax does not apply to a transfer of land if the land was subject to the tax at the time of a previous transfer. The revenue derived from the tax shall be used for agricultural land preservation programs or other programs that support agriculture in the county. The tax shall be reduced by 65% if the land was assessed on the basis of any assessment other than the farm or agricultural use assessment for 5 or more full consecutive taxable years before the transfer; or
(2) Six percent of the value of the consideration for any transfer of real property which, after the effective date of any such rate of tax has been rezoned to a more intensive use at the instance of the transferor, transferee, or any other person who has or had at the time of application for rezoning a financial, contractual, or proprietary interest in the property, but excluding the value of improvements constructed after such rezoning; or
(3) Four percent of the value of the consideration for the initial transfer of a residential unit subject to a condominium regime offered for rent for residential purposes prior to the establishment of the condominium regime. The tax shall be paid by the initial transferor of the residential unit. The tax shall be in addition to the tax provided in paragraph (5) of this subsection; or
(4) Four percent of the value of the consideration for the initial transfer of stock or other evidence of membership in a cooperative housing corporation or similar entity where such stock corresponds to a residential unit which is being converted from rental status to a system of cooperative housing corporation ownership under which title to a multi-unit residential facility is held by a corporation, the shareholders or members of which, by virtue of such ownership or membership, are entitled to enter into an occupancy agreement for a particular residential unit. This tax shall not be applicable to transfers made pursuant to the purchase of a building by or on behalf of a bona fide tenants association. The tax shall be paid by the initial transferor of the residential unit and shall be in addition to the tax provided in paragraph (5) of this subsection; or
(5) One percent of the value of the consideration for any other transfer including any nonresidential leasehold interest and fee interest under subsection (a)(4) of this section based on the:
(i) Average annual rent over the term of the lease, including renewals, capitalized at 10 percent plus any additional consideration payable, other than rent; or
(ii) If the average annual rent can not be determined, the greater of:
1. 105 percent of the minimum average annual rent, as determined by the lease, capitalized at 10 percent, plus any additional consideration payable, other than rent; or
2. 150 percent of the assessment of the real property subject to lease.
(c) No transfer of any interest in such property shall be taxed hereunder where the transfer is to any nonprofit hospital or nonprofit religious or charitable organization, association or corporation, nor to any municipal, county or State government, or instrumentalities, agencies or political subdivisions thereof; provided, that no exemption shall be granted hereunder to a transfer under paragraph (b)(1) of this section unless the transferor is a nonprofit hospital or nonprofit religious or charitable organization, association or corporation, or a municipal, county or State government, or instrumentality, agency or political subdivision thereof. The county council may provide for any additional exemptions from the provisions of this section.
(d) No tax levied pursuant to this section shall apply to transfers pursuant to contracts or agreements entered into prior to the effective date of such tax.
(e) The county council is further empowered and authorized to fix a penalty not in excess of one thousand dollars or imprisonment not exceeding six months, or both such fine and imprisonment, for violation of the provisions of any resolution or ordinance of the county council adopted pursuant to this section. (Mont. Co. Code 1965, § 2-127; 1961, ch. 180, § 1; 1968, ch. 633, § 1; 1970, ch. 164, § 1; 1980, ch. 648, § 1; 1981, ch. 797, § 1; 1982, ch. 191, § 1; 1988, ch. 694, § 1; 2003, ch. 21; 2016 L.M.C., ch. 7, § 2; 2020, ch. 342, §1.)
Editor’s note—It was held in Raply v. Montgomery County, 261 Md. 98, 274 A.2d 124 (1971) that the predecessor to the above section did not authorize the recovery of taxes erroneously paid to the County unless there is a common law right to recover such funds. Section 52-30 (formerly § 52-20, 2016 L.M.C., ch. 7, § 1) is applied in Dean v. Director of Finance, 96 Md.App. 80, 623 A.2d 707 (1993); and Section 52-30(a) (formerly § 52-20(a), 2016 L.M.C., ch. 7, § 1) is cited in Montgomery County v. Fulks, 65 Md.App. 227, 500 A.2d 302 (1985).
See County Attorney Opinion dated 2/29/08 regarding when the State is exempt from the County’s farmland transfer tax only when the State is the transferor.
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