tax sales - right of redemption - MCTLA v. RETSL - equal protection

Lohr and Fouse v. Saratoga Partners – Pa. Supreme Court – reported decision – October , 2020

Held: The availability of a taxpayer remedy of post-sale redemption under the Municipal Claims and Tax Liens Act (“MCTLA”), 53 P.S. §§ 7101-7505, but not the Real Estate Tax Sale Law (“RETSL”), 72 P.S. §§ 5860.101-5860.803, does not violate the equal protection provisions of the United States Constitutions – the 14^th Amendment – or Article I, sections 1, 20, or 26 of the Pennsylvania Constitution.

From the opinion

MCTLA applies only to first and second class counties – only Philadelphia and Allegheny? The homeowner/tax delinquents in this case lived in Huntington CountAy, a 6^th class county.

Like every equality case, this one turned on the appropriate level of scrutiny to be applied. The court held that the right in question – that of redemption within a tax collection statute was not a vested, fundamental right “but rather a merely a ‘right subject to the control of the Legislature.’”  Given that, it held that rational basis review was the appropriate level of scrutiny to judge the differences between MCTLA and RETSL. 

The right of redemption within a tax collection statute is not a vested right but rather merely a “right subject to the control of the Legislature.” IIn the shadow of the clear legislative authority to structure the tax collection process, the taxpayers provide no textual or historical argument supporting a constitutionally-enshrined right to redeem their property by paying delinquent taxes and costs after an upset sale. Absent the identification of a constitutionally-protected right triggering an increased level of scrutiny, we conclude that rational basis review applies to the equal protection challenge raised herein.. . . .

Rather than looking myopically at the inclusion or exclusion of a redemption remedy, a broader consideration shows that both statutes offer protections to the delinquent taxpayer, with the RETSL utilizing greater pre-sale protections, whereas the MCTLA focuses on post-sale remedies. Most significantly, while the MCTLA allows delinquent taxpayers nine months to pay their taxes to regain ownership of their properties, the RETSL grants delinquent taxpayers twelve months to pay their taxes to prevent the loss of ownership, so long as they pay twenty- five percent of the taxes prior to the date of sale. Compare 53 P.S. § 7293 (MCTLA redemption provision) with 72 P.S. § 5860.603 (RETSL removal from sale provision).