Whenever a municipality has heretofore or shall hereafter become the purchaser of any real property at any tax sale and the certificate of sale has been or shall be recorded in the manner provided by chapter 5 of Title 54 of the Revised Statutes, such municipality shall be entitled to immediate possession of the property sold and described in the certificate and to all the rents and profits thereof while the holder thereof, until redemption, but all rents and profits collected by such municipality shall be credited, except as hereinafter provided, on the amount due upon said certificate of tax sale and for subsequent taxes, assessments or other municipal charges assessed against said lands and when the total amount due for the same, including all interests and costs, has been paid, the said lands shall be redeemed from said tax sale.

Whenever a municipality shall take possession of any property pursuant to the provisions of this section, the collector of taxes or other officer thereof, whose duty it shall be to collect taxes therein, or such other officer as may be designated by the governing body of a municipality, shall take possession of said property and collect the rents and profits thereof for said municipality and, with the approval of the governing body of said municipality, may designate any competent person to act as the agent of said municipality for the collection of the rents and profits of said property and for the management of the same and such person shall account promptly to such collector or other officer, and the collector or other officer shall account promptly to the municipality, for the rents and profits so collected.

No fees shall be allowed to such collector or other officer from the rents and profits collected from such property but he shall be allowed such expenses in connection with the operation and management thereof, including proper compensation to said agent, as the governing body of such municipality may deem necessary to secure the greatest income therefrom. Any moneys collected from any such property which is not needed for its operation and management, shall be used to remove or remedy any violations of the standards of fitness for human habitation as are set forth in State or local housing or health codes or regulations, or any other conditions dangerous to life, health or safety; provided that if a determination is made by a designated public officer that the abatement of code violations is economically unfeasible due to the structural unsoundness of the structure or building involved, said public officer shall proceed to require or to cause the closing or demolition of such structure or building, or any part thereof, pursuant to the provisions of P.L.1942, c. 112 (C. 40:48-2.3 et seq.). A record of all expenditures made pursuant to this act shall be kept by the collector of taxes or such other officer as may be designated by the governing body of the municipality. Nothing in this section shall, however, be construed as discharging the owner of any property, of which a municipality takes possession pursuant to said section, of the responsibility and liability for any violation of standards of fitness for human habitation or any other condition dangerous to life, health or safety which may be found to exist on such property within 60 days after the taking of possession of the property by the municipality.

The designated municipal officer in possession of any property pursuant to this section may, at any time, return to the owner of record such property, and any unobligated rents or profits collected therefrom, for the purpose of abating code violations or unsanitary or unsafe conditions, if said owner agrees to make the necessary improvements and submits a list of such improvements, along with an estimate of the costs and a satisfactory schedule for the completion thereof.

While all rents and profits collected and expenditures made pursuant to this section shall be accounted for by and credited to or charged against the individual accounts for each taxable unit of property from which collected or for which expenditures are made, such moneys as are not needed for operations and management of such property may be commingled and aggregated in a single fund for the purpose of abating violations of standards of fitness, as hereinabove required, in accordance with such priorities for expenditures and repairs as may be determined by the responsible officer after consultation with the construction official of the municipality. At no time, however, shall the unobligated moneys deposited in the fund be less than 10% of the total amount deposited and credited to the fund, and in no event shall the amount of moneys available in the fund deprive any person of the right to receive full credits for such rents and profits as would ordinarily be payable on the taxable unit of property at the time of its redemption.

Such municipality and its officers, agents or employees shall not be liable or accountable to the owner or to any other person having an interest in said property for failure to collect rents or profits therefrom but said officers, agents or employees shall remain so liable and accountable to said municipality and such municipality and its officers, agents or employees shall not be liable for injury to said property or to the person or property of any other person from the use of the property for the purposes of this section, any law to the contrary notwithstanding.

L.1942, c. 54, p. 292, s. 1. Amended by L.1943, c. 144, p. 393, s. 1; L.1975, c. 195, s. 1, eff. Aug. 21, 1975; L.1977, c. 444, s. 1, eff. March 2, 1978.