The Secretary of State’s Office would gain nearly $1 million in new annual revenue under a bill that allows it to take over the business of advertising foreclosure sales from local community newspapers where they have appeared for years.
The bill also would remove requirements that banks post notices of upcoming sales in physical locations in the county where the property is located.
Fiscal note: Secretary of State’s office to profit nearly $1 million
Sen. Paul Bailey, R-Sparta
Instead, the Secretary of State would create a new website and charge banks and mortgage companies $200 for each notice.
The fiscal note on the bill shows the Secretary of State’s Office will spend $146,000 to create and operate the website in the first year and receive $488,900 in increased revenues, netting $342,500.
In subsequent years, costs to the state decrease and the Secretary of State is estimated to earn $977,800 a year and, after paying for an additional employee and web hosting, net $921,800.
The bill is expected to hurt local community newspapers the most, taking another swipe at local journalism which has suffered as giant media tech companies like Facebook and Google have created new advertising models for local businesses.
Sponsors: Notices are better on state website than in communities where property is located
The bill is scheduled to be heard Tuesday in the Senate State and Local Committee and on Wednesday in the House Civil Justice Committee.
The bill (SB1324/ HB1355) is sponsored by Sen. Paul Bailey, R-Sparta, Sen. Shane Reeves, R-Murfreesboro, Rep. Andrew Farmer, R-Sevierville, and Rep. William Lamberth, R-Portland.
The bill passed out of the House Civil Justice Subcommittee last week, with sponsors arguing that notices of foreclosure sales would be better on a statewide website than in local communities and in local newspapers where the property is located.
Current state law requires banks and mortgage companies to advertise foreclosure sales in local communities. Foreclosure sales are sales of property that banks and mortgage companies have taken in a foreclosure process to satisfy a debt or lien.
Lawmakers want to replace press’s statewide website with government website
Lobbyists for the Tennessee Press Association have argued that it operates a public notice statewide website in which all notices of foreclosure sales that are published in local community newspapers are available. The notices are also on the local newspapers’ websites. The press association has argued that having the Secretary of State create a new website would be duplicative.
The General Assembly in 2013 passed the statute (T.C.A. § 1-3-120) requiring the press association website, putting certain parameters around its services and operations to ensure legal and public notices were free and searchable to the public and added at no additional charge to the advertiser.
Lobbyists for the banking and mortgage companies requested the bill in which they set the statutory price of their foreclosure notices at $200.
