State lawmakers have killed a bill that would have eliminated the requirement for sheriff’s sale of foreclosed properties to be published in newspapers—a victory for the media industry.
The Senate Local Government Committee voted 5-4 on Thursday against House Bill 1212, which would have mandated that sheriff’s offices advertise foreclosure sales online rather than in printed newspapers. Under the proposal, advertisement would have still been required to be published in a newspaper if no website was available.
Current law requires a sheriff’s sale to be published three times in a newspaper in the county where the property is located or, if there is no newspaper in that county, in a newspaper in an adjacent county. The notices can be revenue generators for newspapers, which have seen advertising revenue drop in recent years.
The bill, authored by Rep. Wendy McNamara, R-Evansville, passed the House 62-34 in January.
McNamara said few people are relying solely on newspapers to get information on sheriff’s sales anymore. She said the cost some newspapers are charging to run the ads could be considered price gouging. She said in Delaware County, for example, the average cost for an ad is $1,132.
McNamara said continuing to require print publication of the ads is a way of subsidizing newspapers, which are struggling to survive financially.
“People aren’t even looking in the newspaper,” McNamara said.
But Sen. Greg Taylor, D-Indianapolis, disagreed with McNamara's "subsidy" description. He said whoever ends up buying the foreclosed property is responsible for paying the advertisement costs.
“A subsidy would mean that we’re paying for it,” Taylor said.
Taylor suggested that the proposal would actually help banks, which often end up buying foreclosed homes, because they wouldn’t have to pay the cost of the notice anymore.
The Hoosier State Press Association and its members, also opposed the legislation.
“It is not a subsidy,” said Steve Key, executive director and general counsel for HSPA. “It is a payment for a service.”
Key said only a handful of newspapers are overcharging for the ads, and the HSPA would be open to addressing that issue. But, he said, HB 1212 isn’t the way to do it.
“We’re not trying to gouge people,” Key said. “It may look that way, but that's not the intent.”
Key said the average cost for a sheriff’s sale notice at 100 newspapers they surveyed was $292.
Key said those notices can be a last line of defense for individuals who may not be aware that their property is being foreclosed upon.
“It doesn’t happen very often, but it happens,” Key said.
Taylor said he also had concerns that changing one public notice law could lead lawmakers to consider doing the same to other public notices that are still required to be published in newspapers.
“It’s irrelevant who reads it,” Taylor said. “It’s all about transparency. It’s about public information being in the public.”
McNamara said she was pursuing the change to sheriff’s sales notices because she had data showing that people are using the internet to find the information rather than using newspapers. She said she didn't have data for other types of public notices.
Nate Feltman, co-owner of IBJ Corp, publisher of IBJ, Indiana Lawyer and Court & Commercial Record, also testified against the bill.
Representatives from banks and vendors that conduct the sheriff’s sales testified in support of the bill, saying it would be more cost-effective to publish the ads only online. The Indiana Sheriff’s Association also supported the legislation.
Sen. Rick Niemeyer, R-Lowell, voted in favor of moving the bill forward, saying online publication is the way of the future and he believed his constituents would agree with the decision.
“I think we prolonged this as long as we can,” Niemeyer said.