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SB 2713

AN ACT RELATING TO TAXATION -- PROPERTY EQUITY PROTECTION ACT

2026 Regular Session Introduced by Gordon Rogers and 1 co-sponsor

Protect property owners’ equity by extending redemption up to 5 years, raising foreclosure thresholds, and adding online bidding with enhanced multilingual notice requirements.

04/28/2026 Committee recommended measure be held for further study
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Bill Summary · SB 2713

Summary of Bill SB 2713 (Rhode Island, 2026)

Title: AN ACT RELATING TO TAXATION — PROPERTY EQUITY PROTECTION ACT

Jurisdiction: Rhode Island

Session: 2026

Introduced: February 27, 2026
Primary Sponsors: Senators de la Cruz and Rogers
Current Status: Referred to Senate Judiciary; committee recommended hold for further study (as of 4/28/2026)

1) Purpose and Intent

  • The bill establishes the Property Equity Protection Act to protect property owners from losing their equity when their property is seized to satisfy a tax debt to the government.
  • It aims to ensure there is ample time to payoff the debt and that due process notice requirements are provided.

2) Key Provisions and Changes

Creation of Chapter 9.1 in Title 44 (Taxation)

  • Chapter Name: Property Equity Protection Act (44-9.1)
  • Purpose (44-9.1-2): Protect property owners’ equity by slowing foreclosure/seizure and improving notice/due process.

Redemption and Foreclosure Thresholds (44-9.1-3)

  • Redemption Window (a): A person may redeem a tax debt on behalf of the property owner within:
    • 5 years after the delinquency, or
    • 5 years after delinquency but before a treasurer’s deed is issued to a purchaser or heirs/assigns, for qualifying properties (as described in subsection (b)).
  • Foreclosure Threshold (b): A tax lien/deed cannot be foreclosed unless:
    • the outstanding tax debt (plus penalties, interest, and fees) is greater than 5% of the parcel’s fair market value (as shown by the current tax assessor valuation), or
    • at least $50,000,
    • whichever is lower.
    • If the debt exceeds $50,000, foreclosure may proceed under Chapter 9 of Title 44.

Competitive Auctions (44-9.1-4)

  • After redemption period, a foreclosure action may be filed (consistent with existing law).
  • Introduces an online real-time bidding process for tax sales.
  • Requires advertising the sale for at least 30 days via a multiple listing service (MLS).
  • Winning bidders must pay the full delinquent amount and accept the lowest interest rate offered to redeem the property.
  • Highest bidder wins the sale of the property.
  • Private contractors may operate/advertise the auction and may receive up to 3% of any sale amount that exceeds the delinquent debt and charges.

Notice Requirements (44-9.1-5)

  • Tax collectors must certify notices 60–120 days before a tax sale.
  • Notice must be sent by certified/registered mail to:
    • Property owner(s) of record
    • Lienholders and mortgagees (if addresses on records)
    • Vendee of contract for deed (if address on record)
    • Other lienholders who requested notices
    • Persons assessed on the tax roll for the year of last assessment
    • Contiguous property owners (with defined meaning of “contiguous”)
    • Any person who requested notices
  • Tax collector must obtain a title/abstract report for notice purposes and may contract with a title/abstract company.
  • Notices must include a bilingual warning statement in the state’s five most common languages, stating the risk of tax sale and offering information on free legal assistance.
  • Notices must be published in a local newspaper and posted on the property, as well as on the tax collector’s website and offices.
  • Notices must be recorded; purchasers of the property after notice are deemed to have notice. Recording of a sale releases the recorded notice.
  • Fees for notices may be paid from sale proceeds or added to the opening bid.

Surplus Proceeds (44-9.1-6)

  • If sale proceeds exceed delinquent taxes and liens, surplus is distributed in this order:
    1. Pay delinquent taxes and liens (plus penalties/fees)
    2. Satisfy government lienholders
    3. Surplus goes to the property owner (or heirs/assigns); owner notified
    4. If multiple claimants or unclaimed funds within 120 days, the tax collector may file an interpleader action or distribute per priority of liens; costs come from the surplus
    5. Unclaimed surplus after 120 days is treated as provided by Chapter 9 of Title 44

Interest Rates and Penalties (44-9.1-7)

  • Taxes accrue interest at: Prime rate (as published by the Federal Reserve in H.15) plus 3%, compounded monthly.
  • Interest accrues from due date until paid.
  • Other penalties are not imposed beyond reasonable collection costs (which may be added to the tax debt).

Related Revisions to Foreclosure Petitions (Section 44-9-25)

  • After one year from a tax sale, the holder may petition for foreclosure of redemption.
  • Several formalities: description of land, sources of title, and consolidation provisions for multiple parcels.
  • Limits on attorney fees for petitions.
  • Special rule for Rhode Island Housing and Mortgage Corporation properties: five-year wait before petition for foreclosure of redemption.
  • A threshold requirement keeps the same 5% of FMV or $50,000 cap (consistent with 44-9.1-3) for petitions to foreclose redemption.

3) Affected Parties

  • Property owners and their heirs/assigns
  • Tax lienholders, mortgagees, lienholders of record, and contract-for-deed vendees
  • Local and state government taxing jurisdictions
  • Private auction operators/advertisers
  • Title/abstract companies used for notices
  • Rhode Island Housing and Mortgage Corporation (in specified contexts)

4) Procedural and Timeline Aspects

  • Effective date: Upon passage.
  • Redemption window: Up to 5 years post-delinquency or before treasurer’s deed to purchaser/heirs/assigns (for eligible properties).
  • Foreclosure/auction timing: After redemption period, with online bidding and 30-day MLS advertising.
  • Notice timeline: 60–120 days before sale, with multi-stage notice intervals (60, 30, 30 days at various steps).
  • Surplus distribution and interpleader procedures: If surplus funds exist, timelines include 120-day claim window.
  • Interest calculation: Annual rate set yearly based on H.15 prime rate + 3%, accruing monthly.

5) Practical Implications

  • Stronger protections for property equity by extending redemption opportunities and raising thresholds for foreclosure.
  • Expanded and formalized notice requirements, including multilingual warnings and public posting.
  • Introduction of online bidding and expanded lot of procedural requirements could increase transparency and potentially reduce risk of inadvertent loss of equity.
  • Potential cost implications for municipalities and private auction operators (administrative and possible contractor fees).

Note: The bill is currently under committee review (held for further study as of the latest action).

Compiled from official sources — confirm details with the bill’s official record.

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