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April 14, 2026 - City Manager’s Report - Consent Agenda: 26-99a: Adoption of an ordinance authorizing payment of escheated funds from the tax sale of 3506 Blaine Street to David V. Gill and Daniel Lee Barns, as authorized by Section 58.1-3967 of the Virginia Code and appropriating the sum of $9,525.24 from the Fund Balance of the General Fund to the FY 2026 General Fund Budget for said purpose. Background:  The property located at 3506 Blaine Street, Portsmouth, Virginia was sold at a tax sale and, after payment of the applicable past-due taxes and liens, the remaining funds were placed in escrow with the Circuit Court for a period of two years from the date of confirmation of sale, as required by the Virginia Code.  The confirmation of sale was entered on May 27, 2022, and the Circuit Court received the funds on June 8, 2022. Several former owners of the property petitioned the court to release the funds on June 4, 2024, incorrectly calculating the start of two-year escrow period as the date the Court received the funds, not the confirmation of sale.  Because the petition to the Court for release of the funds was not within the two- year escrow period, the funds escheated to the City.  When the funds escheated, they went into the City’s fund balance.  Section 58.1-3967 of the Virginia Code allows the former owner of property sold at tax sale, or their heirs or assigns, to petition City Council for payment of any funds from the sale that escheated to the City. City Council has full discretion as to whether to grant or deny the petition.  Last fall, five other former owners of this property submitted petitions to City Council to receive repayments for their share of the surplus. City Council approved their petitions at the October 28, 2025 meeting, appropriating a total of $27,146.94 for repayment. Discussion:  th David V. Gill and Daniel Lee Barns, former owners of a 10/84 interest in 3506 Blaine Street, have petitioned City Council by counsel for payment of surplus funds from the tax sale of the property.  The total amount of surplus funds received by the City for the tax sale was $40,006.03. The total interest of each petitioner is as follows: th David V. Gill: $4,762.62 (10/84 interest) o th Daniel Lee Barns: $4,762.62 (10/84 interest) o  Accordingly, the ordinance prepared for City Council’s consideration appropriates $9,525.24 (about 24% of the surplus amount) from Fund Balance to the General Fund for payment to the petitioning former owners.  If approved, the total amount of appropriated funds to former owners of 3506 Blane, including the five petitions approved last year, will be $36,672.18 (about 92% of the surplus amount). Financial Impact:  The sum of $9,525.24 will be appropriated from Fund Balance to the FY 2026 General Fund Budget for payment to the petitioning former owners. Recommended Action:  Adoption of ordinance. Strategic Pillar #4: Safe, Connected, and Thriving Community. Next Steps Following Council Action:  The Finance Department will make the necessary budgetary adjustments.  Payment in the amount of $4,762.62 will be made to each of David V. Gill and Daniel Lee Barns.