ELIZABETHTOWN — Following the fireworks generated by the tax auction earlier this year, lawmakers and county officials are working to ensure a smooth takeoff for the auction slated for this fall.
The players: County Clerk Joe Provoncha, County Attorney Dan Manning, Treasurer Mike Diskin and a handful of town supervisors.
“I know the county doesn’t do an excellent job with the owners who are delinquent who are about to lose their properties,” Crown Point Supervisor Charles Harrington told officials last month. “We also need to know that the county isn’t going to get themselves in a situation like in the past.”
Harrington said it’s costly for the county to let delinquent properties stack up. Revenue can’t be generated and neighboring property values plummet.
“The value goes on a downward spiral,” he said. “I want the three agencies involved with the sales to be aware of the timeline that has been established. They all have a goal to meet the timeline.”
Earlier this year, officials said they hoped to hammer out auctions on a regular schedule. Officials say they are on track for the next to be held in mid-October.
Harrington said the board needs to ensure smooth communication within the three departments that facilitate the sales.
“If there are any glitches in the system, and if assistance is needed, then we need to deal with that. We can’t allow ourselves to put ourselves in a pit again.”
While Harrington couldn’t give an exact figure on how many tax-delinquent properties there were in Crown Point, Diskin said the town had just a single property slated for sale this fall. Nine were auctioned off at the last sale on April 30.
“I totally agree,” said Provoncha. “We do need to work together.”
The clerk said the agencies have a smooth relationship and have wrapped up work on the 2009 properties. They are almost finished with 2010 and starting on the 2011s.
Provoncha reminded lawmakers on Monday that the process starts when Manning, acting on behalf on the treasurer, files a delinquent tax list and starts a civil action that tells parties what properties are in jeopardy of being foreclosed upon.
Tax sale searches will determine if there are liens or judgements against the property. Deeds are examined and the subsequent info is digitized and zipped off of the other offices, who will then notify the owners of the situation.
“It’s the law that they need to be aware that their interest in that property will be extinguished if they don’t pay their taxes,” said Provoncha.
“We’re done with 2009 and ready to go,” said Diskin. After getting an order, his office anticipates an early-fall auction date.
Currently, about approximately 90 parcels on the block.
A minimum of 90 days is needed for the process, said Diskin, which puts 2010 out of the realm of this year.
After that, his office will turn the list of properties over to an auction company.
Owners have the opportunity to repurchase up to 14 days before the sale.
April’s auction dispensed of 105 lots worth $1,465,618.69. The bids received on the parcels clocked in at $988,990, which resulted in a net negative of $476,628.69, according to Haroff, the firm that brokered the auction.
Several other parcels, including two in Schroon, were removed for easement purposes. Four others were removed from owners who hadn’t paid back taxes. The county is the process of contacting the back-up bidders to see if they’re still interested, said Diskin.
On Monday, he gave lawmakers a list of the 90 properties scheduled for sale.
“If you see something that strikes your fancy, pick one out and let us know before we turn them over to the auctioneer,” he said.
‘THEY HAD NO RIGHT’
Moriah Supervisor Tom Scozzafava said he was upset that the county didn’t have a way to prevent bidders who already owe taxes from bidding on more properties.
Diskin said the last auction was the first time in 20 years that the county asked a participant to pay up, but they refused.
Four people who owed taxes offered winning bids at the last sale: two paid, two did not, a total amounting to $48,000.
“This is the first instance I can remember where a person or persons did not pay taxes they owed if they bought a foreclosure parcel at the auction,” said Diskin.
“When someone registers, can you find someone who owes taxes?” Scozzafava asked Diskin. “I can pull up a [list] right now.”
“Can you do it at the next auction?” asked Diskin.
“Why can’t you just stop it?” Scozzafava shot back. “A lot of those properties were in my town. The people came in and they had no right.”
Diskin said the only way to prevent such bidders from bidding on the auction would be to write the clause into the terms and conditions. But even then, he said, there are ways to game the system.
Bidders could register under different names or form new limited liability corporations that would make tracking difficult. Co-owners often fly below the radar and don't show up in searches. Furthermore, he said, screening the bidders, who don’t register until the day of the auction, would be difficult.
“We would have to be there with laptop and look each person up,” he said.
Board Chairman Randy Douglas said if it was determined that the first bidder owed taxes, the property should be kicked over to the runner-up.
“Make them sign something,” said Scozzafava. Without giving a name, he cited an area resident who owes a “significant amount of taxes” and was allowed to bid at the last auction.
“What do we do with them?” he asked.
“Put them in jail,” cracked North Elba Supervisor Roby Politi, grinning from the sidelines.
“I agree with Scozzafava on this,” said Douglas.
“They’re going to figure it out, file under another name,” said Diskin. “You’re never going to stop them.”
Manning, who treated lawmakers earlier to a detailed explanation of the law that saw their eyes glaze over, urged patience:
“We’re on track,” he said.
Shortly afterwards, he called for an executive session to discuss litigation related to Frontier Town, the former theme park that was put on the block at the last auction but remains in limbo.
Lawmakers were behind closed doors for 20 minutes without making a decision.