What explains the resolution of property tax delinquency prior to forfeiture? Evidence from Hennepin County, Minnesota

Abstract

ABSTRACTThis article focuses on the rate of redemption for tax delinquent properties in suburban and central city contexts of Hennepin County, Minnesota. Using a county-wide data set of properties that became tax delinquent in 2004, time-to-event (survival) models assess how the rate of redemption for tax-delinquent properties differs for properties subject to different redemption periods determined by property type and location. After controlling for a variety of other property and neighborhood-level characteristics, results indicate that the rate of redemption for tax-delinquent properties differs by location in ways that are not completely explained by different redemption policies associated with location and property type. These results suggest that in areas with healthy economies and minor tax delinquency problems government redemption policies may play less of a role in shaping redemption behavior than the characteristics of the property, neighborhood conditions, and regional factors that influence the perceived value of tax-delinquent properties in central cities and suburbs. These results have important implications for how local governments in the United States consider tax-delinquency issues in an era when economic and social changes in suburbs have made property tax delinquency a problem for central cities and suburbs alike.