FREDERIC P. FELKER, Corporation Counsel Douglas County
You have asked whether the newly created subsections (5), (6) and (7) of section 75.35, Stats., as of their effective date, are applicable to lands already sold for taxes under section 74.39 but not yet resold under section 75.35. In my opinion, the answer is no, the new subsections are not applicable to those lands.1
The request is prompted by the creation and modification of statutes in 1987 Wisconsin Act 27. The newly created subsections provide for the disposal of the proceeds received from the sale of property that was acquired by the county at a tax sale. Prior to the changes, the disposal of proceeds was provided for in section 74.39, Stats. (1985), which was amended by 1987 Wisconsin Act 27, section 1557m as follows:
Sale of real estate. On the day designated in the notice of sale the county treasurers shall begin the sale of those lands on which the taxes, penalty and interest have not been paid and shall continue every day, Sundays excepted, until enough of each parcel has been sold to pay the taxes, interest and penalty as provided under s. 74.80 upon the amount of such taxes from January 1 of the next year after the tax levy. [Of the proceeds of the sale, an amount equal to the actual costs of the sale and the taxes, penalty and interest shall be paid into the county treasury, any special assessments owed and penalties and interest in respect to those assessments shall be sent to the unit of government to which they are owed 2nd the remainder of the proceeds shall be paid to the person whose property was sold]* All moneys received from that sale shall be paid into the county treasury. If the treasurer discovers before the sale that because of irregular
* [EDITORS' NOTE: THE TEXT CONTAINED WITHIN THE BRACKETS WAS STRICKEN THROUGH IN THE ORIGINAL TEXT.] *Page 134
assessment or any other error any of the lands ought not to be sold, the treasurer shall not offer them for sale but shall report the lands withheld from sale and the reasons for withholding them to the county board at its next session.
To provide for the dispersal of the proceeds, subsections (5), (6) and (7) of section 75.35 were created by 1987 Wisconsin Act 27, sections 1560m, 1560p and 1560r, respectively, which provided:
SECTION 1560m. 75.35(5) of the statutes is created to read:
*Page 13575.35(5) NOTICE; PROCEEDS. Upon acquisition of a deed under s. 75.14, the county treasurer shall notify the former owner, by registered mail sent to the former owner's mailing address on the tax bill, that the former owner may be entitled to a share of the proceeds of a future sale. If the former owner does not request, in writing, payment within 60 days after receipt of that notice, the former owner forfeits all claim to those proceeds. If the former owner timely requests payment and if the property is not subject to a special assessment the proceeds of which are pledged under s. 66.54(10), the county shall send to the former owner the proceeds minus any delinquent taxes, interest and penalties owed by the former owner to the county in regard to other property and minus the greater of the following amounts:
(a) Five hundred dollars plus 50% of the amount obtained by subtracting $500 from the proceeds.
(b) The actual costs of the sale as specified under s. 75.36(7) plus 2% of the sale price plus all delinquent taxes, interest, penalties and special assessments owed on the property sold and plus the amount of property taxes that would have been owed on the property for the year during which the sale occurs if the county had not acquired the property.
SECTION 1560p. 75.35(6) of the statutes is created to read:
75.35(6) SPECIAL ASSESSMENTS. From the amounts retained under sub. (5), the county shall pay any special assessments owed and penalties and interest on those assessments to the unit of government to which they are owed.
SECTION 1560r. 75.35(7) of the statutes is created to read:
75.35(7) LIABILITY PRECLUDED. Absent fraud, no county is liable for acts or omissions associated with the sale of property under this section.
The dispersal provisions of subsections (5), (6) and (7) of section 75.35 were also made applicable to the proceeds received from the sale of tax certificates. See sections 74.46(3) and 75.34(3) as created by 1987 Wisconsin Act 27, sections 1558m and 1559m, respectively. Finally, the dispersal provisions in section75.35 were made applicable to the procedures in populous counties by the creation of section 75.67(4) in 1987 Wisconsin Act 27, section 1562m.
The question of the effective date of these changes is answered by the interpretation of 1987 Wisconsin Act 27, section 3203(47)(c), which provides: "Proceeds of tax sales. The treatment of sections 74.39, 74.46(3), 75.34(3), 75.35(5), (6) and (7) and 75.67(4) of the statutes first applies to sales of property acquired by counties on the effective date of this paragraph."
In regard to this provision, you have asked whether the "sales" referred to means the initial tax sale in section 74.39 or the subsequent sale to which section 75.35 is applicable. You also ask whether the phrase "acquired by counties" refers to the county's acquisition at the section 74.39 sale or the acquisition when the tax deed is taken.
In my opinion, the "acquired by counties" language refers to property acquired by the county at the section 74.39 sale. Because section 3203(47)(c) refers to sales of tax certificates (sections 74.46(3) and 75.34(3)) as well as tax deeded property (section 75.35), the "acquired by counties" phrase cannot be limited to property for which the county has received a tax deed since the county would not have received the tax deed when it sold the tax certificates. Therefore, section 3203(47)(c) applies to property the county acquired at the section 74.39 tax sale.
The other question is whether the new statutes apply to sales of tax certificates and tax deeds for property the county acquired in section 74.39 sales before the effective date of section 3203(47)(c) or only to sales of tax certificates and tax deeds for property acquired by the county on or after the effective date. The answer rests on whether the phrase "on the effective date of this paragraph" in section 3203(47)(c) modifies the word "sales" or the phrase "property acquired by counties."
For two reasons, I conclude that the phrase modifies "property acquired by counties." The first reason is grammatical. No punctuation indicates that the phrase "on the effective date of this paragraph" *Page 136 refers to the word "sales." It is more logical to read the phrase "on the effective date of this paragraph" to refer to the words immediately preceding it, which is the phrase "property acquired by counties."
The second reason concerns the subject matter of the statutes affected by the changes. Prior to the change, section 74.39 accounted for the dispersal of the proceeds. If the newly created subsections (5), (6) and (7) of section 75.35 are applied to the sale of tax certificates and tax deeds of property the county acquired under the old section 74.39, then two disposal statutes would be applied to the same property, those statutes being the old section 74.39 and the new subsections 75.35(5), (6) and (7). However, if the new statutes apply only to property acquired by the county in a section 74.39 sale on or after the effective date, then each sale of tax certificates or tax deeds is covered by one disposal statute: property acquired under section 74.39 before the effective date is covered by the disposal provisions of the old section 74.39 and property acquired under section74.39 on or after the effective date is covered by the disposal provisions of the new subsections (5), (6) and (7) of section75.35.
Therefore, in my opinion, the new provisions apply to the sale of tax certificates or tax deeds for property the county acquired in a section 74.39 tax sale on or after the effective date of 1987 Wisconsin Act 27, section 3203(47)(C).
DJH:SWK
1 Sections 74.39, 74.46(3), 75.34(3), 75.35(5) and (6) and75.67(4), which are discussed in this opinion have been amended or repealed by 1987 Wisconsin Act 378 sections 75, 114, 120, 121 and 153m. However, these changes do not become elective until January 1, 1989. See 1987 Wisconsin Act 378 sections 181 and 182. *Page 137