Since I first became a member of the City Council, I have met with countless families facing foreclosure and displacement over debts that were shockingly small compared to the value of their homes. As attorney general, I’m still fighting the same battle. New York City’s tax lien sale — recently revived after a long pause — continues to wreak havoc on hardworking families, destabilize communities, and strip intergenerational wealth from homeowners.
The story of Brooklyn’s Filmore Brown demonstrates the cruelty of this system. After living in the same home for decades, Mr. Brown had it sold out from under him — not because of an unpaid mortgage or debt — but because of an unpaid water bill. In a city where every dollar matters, no one should lose their home over a municipal bill that could be resolved through payment plans, assistance programs, or direct negotiation. But this is exactly the sort of injustice that the tax lien sale creates.
The legacy of the tax lien sale is devastating. Studies have shown that it falls hardest on Black and Brown homeowners, stripping families of wealth that took generations to build. While our city faces an affordability crisis, we cannot continue a practice that accelerates gentrification and deepens inequality.
For years, I have called for the end of this practice. I have written to multiple mayors, urged the City Council to act, and sounded the alarm that the lien sale disproportionately harmed communities already vulnerable to predatory lending, deed theft, and displacement. I have warned that the lien sale does not serve the public interest, it enriches private investors at the expense of working families.
When New York City sells a tax or water lien to a private trust, homeowners face steep fees, interest charges, and the threat of foreclosure. What might have begun as a manageable bill becomes a financial death spiral. Instead of helping families get back on track, the city transfers the burden to investors who profit from foreclosure. The result is that generational wealth is lost, neighborhoods are destabilized, and another door to economic security is slammed shut.
The City Council deserves credit for taking steps to reform the lien sale last year, with new protections for homeowners and a recognition that the system needed serious change. With that step out of the way, the time has come for bold, comprehensive action.
That starts with accountability. I’m calling for a public hearing and investigation into Brown’s case, and into the broader practices of the tax lien sale system. His ordeal is not an anomaly; it is a symptom of a broken system that must be dismantled.
Second, there must be an immediate moratorium on foreclosures and evictions stemming from tax and water lien sales. Families should not live under the threat of displacement while policymakers debate reforms. New Yorkers need breathing room and certainty that they will not lose their homes over unpaid bills from the city.
Third, New York should follow the example of Maryland and remove water bills from the lien sale process. Water is a basic human right, and nonpayment should never be a pathway to foreclosure.
Pending legislation in Albany — including bills to compensate the former owners of the property, prohibit the sale of debts to private collectors, and provide homeowners facing tax lien foreclosures the same rights as those facing mortgage foreclosures — offer promising paths forward, and our lawmakers must act quickly.
Finally, we must be willing to think bigger. Community leaders and housing advocates have shown that there are alternatives. We should look closely at providing a right to counsel before a lien leads to the loss of the home. Rather than funneling distressed properties into the hands of private investors, the city could transfer them to nonprofits, community land trusts, or mission-driven developers who will preserve affordability, prevent displacement, and build equity for New Yorkers.
Brown’s case is heartbreaking, and it’s also a call to action. We cannot allow another homeowner to lose their home over a water bill. We cannot tolerate a system that trades away family equity and neighborhood stability for short-term revenue. And we cannot delay reforms any longer.
As attorney general, I will continue to fight for every New Yorker’s right to a safe, stable home. The City Council and state Legislature must join me in taking immediate and lasting action. Let us finally transform the tax lien sale and replace it with a fair, humane system that keeps families in their homes and communities intact.
New Yorkers deserve nothing less.
James is the attorney general of New York.
