May a Municipal Officer Buy Tax-Acquired Property?

Training for: Legal Notes

Question: May a municipal officer (selectman or councilor) purchase tax-acquired property from the municipality?

Answer: Yes, but only if the sale is conducted in compliance with applicable law.

According to 36 M.R.S.A. § 946, third paragraph, a municipal officer, while holding office, may not acquire any interest in tax-acquired property unless the sale is conducted by sealed bid after it has been advertised at least twice during a seven-day period prior to the acceptance of bids. (We recommend that the sale be advertised in a newspaper of general circulation in the area.) Moreover, any municipal officer who submits a bid is barred from participating in the bid acceptance process.

The advertising and sealed bid requirements do not apply if the property was owned by the municipal officer’s son, daughter, spouse or parent immediately prior to its acquisition by the municipality “and if such purchase is authorized by the municipality.” This second condition appears to require that the purchase be authorized directly by the municipality’s legislative body (town meeting or town or city council).

There is no analogous statute restricting tax-acquired property sales to other municipal officials or employees, although a local charter, ordinance or policy could do so. In the absence of any local restrictions, we nevertheless recommend that a sale to other officials or employees be conducted in the same manner as sales to municipal officers, that is, by advertised sealed bid and with no participation by the official or employee in the bid acceptance process.

For much more on the sale of tax-acquired property, see our “Information Packet” on the subject, available free to members at www.memun.org. (By R.P.F.)

Question: May a municipal officer (selectman or councilor) purchase tax-acquired property from the municipality?

Answer: Yes, but only if the sale is conducted in compliance with applicable law.

According to 36 M.R.S.A. § 946, third paragraph, a municipal officer, while holding office, may not acquire any interest in tax-acquired property unless the sale is conducted by sealed bid after it has been advertised at least twice during a seven-day period prior to the acceptance of bids. (We recommend that the sale be advertised in a newspaper of general circulation in the area.) Moreover, any municipal officer who submits a bid is barred from participating in the bid acceptance process.

The advertising and sealed bid requirements do not apply if the property was owned by the municipal officer’s son, daughter, spouse or parent immediately prior to its acquisition by the municipality “and if such purchase is authorized by the municipality.” This second condition appears to require that the purchase be authorized directly by the municipality’s legislative body (town meeting or town or city council).

There is no analogous statute restricting tax-acquired property sales to other municipal officials or employees, although a local charter, ordinance or policy could do so. In the absence of any local restrictions, we nevertheless recommend that a sale to other officials or employees be conducted in the same manner as sales to municipal officers, that is, by advertised sealed bid and with no participation by the official or employee in the bid acceptance process.

For much more on the sale of tax-acquired property, see our “Information Packet” on the subject, available free to members at www.memun.org. (By R.P.F.)