Michelle Z. Marchiony (J.D. 2013, Emory), Comment, Making Debt Pay: Examining the Use of Property Tax Delinquency as a Revenue Source, 62 Emory L.J. 217 (2012):

In tough economic times, everyone looks for ways to do more with less.
Local governments, however, face the challenge of doing more with money
they do not have. With the recent shrinking of their budgets, it is critical that
governments use their limited funding and opportunities for future funding
wisely. One such opportunity for future revenue, the payment of delinquent
property tax obligations, is critical to providing basic public services, such as
education and emergency services. However, government officials may not be
maximizing this resource and there is a risk that governments’ financial needs
are being exploited.

In an effort to generate revenue and overcome budgetary shortfalls, many
local governments sell the right to collect delinquent taxes, along with interest
and penalties applied to the amount owed, through the sale of property tax
liens. The liens are sold, often for less than the amount of total debt, to private
investors who are able to use the government’s enforcement tools—including
property foreclosure—to collect the debt owed. Although this $20 billion
market generates short-term funds, it obscures the amount of revenue that is
forgone in exchange.

This Comment examines the strategies available for managing delinquent
tax digests in search of a method that maximizes the return received by local
governments while preserving political accountability, protecting consumers,
and minimizing aggregate social costs. It analyzes the risks posed by tax lien
sales to these objectives and suggests that delinquent tax anticipation notes
and contracted lien servicing, or a combination of the two alternatives, best
enable governments to maximize revenue, meet policy objectives, and serve
taxpayer interests.