When evaluating the sale or securitization of tax liens, governments should ensure they:

When evaluating the sale or securitization of tax liens, it is crucial for governments to have legal authorization and clear objectives. This ensures that the process adheres to statutory requirements and that the government has a well-defined purpose and plan for the sale. Legal authorization is vital because it protects the government from potential legal challenges and ensures that they are operating within the law when transferring tax liens to private entities. Clear objectives help in guiding the process effectively, enabling the government to achieve desired outcomes such as maximizing revenue or improving collection efficiency.

Additionally, having a solid understanding of the legal framework and a clear set of goals contributes to transparency and accountability in the transaction. It also sets the stage for successful communication with stakeholders, including taxpayers and potential investors, which can strengthen community trust and support.

In contrast, focusing solely on community relations does not ensure the legitimacy or effectiveness of the process. Relying primarily on past collection rates without a comprehensive review of current conditions could lead to miscalculations and potential financial instability. Prioritizing an increase in sales proceeds exclusively for recurring expenses might overlook the importance of a strategic approach to managing tax liens.