New Bedford Tax Lawsuit Dismissed

NEW BEDFORD — A lawsuit taken by a New Bedford woman against the city over a tax debt that ultimately cost her her home has been dismissed.

City officials said in a press release that Deborah Foss, who had sued the city and the Boston debt collection agency in March, reached a settlement with the private firm.

However, her case against the city of New Bedford was dismissed in U.S. District Court on Aug. 12, and Foss will not be able to re-file the case in the future.

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According to the release, the city will not be responsible for any payment to Foss.

She had taken out the lawsuit over the city's sale of her $10,000 tax lien to private debt collection company Tallage Davis, LLC, resulting in her losing her Valentine Street home worth $242,000.

Foss became homeless after the company evicted her in February.

Officials stated in the release that Massachusetts law allows cities to sell tax debts to third parties to recoup some of the lost revenue from delinquent taxes.

The practice allows cities to avoid employing internal legal staff just to pursue tax liens in land court, the release noted.

In 2015, New Bedford was owed more than $22.6 million in delinquent property taxes — equivalent to nearly six percent of the city’s budget, according to the release.

The city sold Foss' tax debt as part of a bulk tax lien sale to Tallage.

After New Bedford's last tax lien sale took place in May 2019, the city's delinquent taxes had been cut by half, to $11.3 million.

Officials noted in the release that the city amended its tax repayment ordinance in 2012, allowing delinquent taxpayers to take up to five years to repay the city and receive 50% interest forgiveness after paying a quarter of the outstanding balance.

"As always, the city’s preference is to service delinquent taxpayers by offering repayment agreements and managing delinquencies in-house," the release concluded.