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Home My WebLink About1993-09-27 93-432 ORDERCOUNCIL ACTION Item No. 93-432 Date Sept. 27. 1993 Item/Subject: Abating Real Estate Taxes Assessed Against Property Located at 9 & 16 Center Street Avenue, City Tax Map 40, Late 146 & 128 Responsible Department: Legal The attached Council Orders would abate taxes assessed by the City of Bangor for fiscal year 1993 against property owned by Friends of the Together Place at 9 and 16 Center Street Avenue, and would authorize execution of -a quitclaim deed with respect to tax liens -r corded for BY 1993. Friends of the Together Place (FOTP) is a charitable non- profit - pro£it corporation which took title to these two properties in March, 1992, for rehabilitation and use s a cooperative housing project for people with mental health disabilities. Accordingly, the properties qualified for .tax exempt status prior to April 1, 1992, the relevant date for FY 1993 tax purposes. Recently, FOUR filed -a request for abatement of 1993-1994 taxes assessed against the two properties. Concurrently with these attached Council Orders, the City Assessor is abating taxes erroneously assessed against these two properties for BY 1994. Under 36 MRSA g 841(1), however, Council action is required to abate the BY 1993 taxes. The City Assessor and the Legal Department recommend your:: approval. . 0. i �CS�i GiI� ` y Manager Associated Information: OrderiBen Birch's 8/127/93. Memo.,. Roger - Gzi£fith'm (FOTF) 8/17/93 Letter, 6/31/93 Application for Abatement -.-Budget Approval: Finance Director City Sol'c'to Intr uced For C Passage First Reading _ Referral Page 1 of Department Hes Manager's Comments: i �CS�i GiI� ` y Manager Associated Information: OrderiBen Birch's 8/127/93. Memo.,. Roger - Gzi£fith'm (FOTF) 8/17/93 Letter, 6/31/93 Application for Abatement -.-Budget Approval: Finance Director City Sol'c'to Intr uced For C Passage First Reading _ Referral Page 1 of .-Agnulm Cm ... On, Shubert scptemher 27,1993 CITY OF BANGOR Abet g Real Estate Taxes Assessed Against Property (nilEJ rber,- ............. ............... .......... _. ....... Located at 9 and 16 Centex Street Avenue, City Tax Map 40, Lots: 146 d 128 (Act unt o. 20248 add 481595 By da My Caused of Mo CRY ofBaA .- OEDEEED, THAT the City Council of the City of Bangor, acting a the Municipal Officers of the City of Bangor, pursuant to 36 M.R.S.A. g 841(1), upon application by Friends of the Together Place, hereby abates the following real estate taxes. Said taxes are abated as having been assessed in error against real estate exempt from taxation under 36 M.R S.A. g 652(1). Mount Owner Acct. No. Tax Year Abated Friends of the 20248 1993 $ 864.56 Together Place 48159 1993 918.78 The City Council further abates all interest, lien .charges and other charges accrued on account numbers 20248 and 48159 as a result of the above erroneous assessments. 93-432 ORDER Title, IN CITY COUNCIL September 27, 1993 Abating Real. Estate Taxes.WPp6Y0.8Eeinet Passed Property located a[ 9 and 16 Center Street Avenue L L CSry Tax Map 40. Lora 146 and 128 (Accwnte No. 20248 k C1 eud 481 9} ............................ CITT LEPR Aeeipwd to ........to 4 ................ Councilman 93_432 J APPLICATION NO._. MAP _LOT ACCOUNT NO. CITY OF BANGOR, MAINE ASSESSING DEPARTMENT APPLICATION FOR ABATEMENT (OR REVIEW) OF PROPERTYTAXES 1. Name of applicant Friends of Together Place 2. Address of Applicant 150 Union Street 3. Location of property on which abatement (or review) is requested 9 & 16 Center Street Avenue 0. Assessed valuation of Real Estate (or Personal Property) $827600 5. Owners opinion of current value of property $827600 6. State below your reasons for requesting abatement (or review). We are requesting e one time abatement of 1992 property taxes as ware a qualified charitable corporation which occupied the theproperty £orur charitable p rpose. (see attached memo � 'k�,_t f 1 C" y C lii itorl This application for abatement (orreview) is made to the Board of Assessors, Bangor, Maim, imaccomance with the provisions of Section 706 of Title 36, Revised Statutes. The above statements are correct to the best of my knowledge and belief. Date August 31 1993 Siynvrure ujApplimxr THIS APPLICATION TO BE FILED IN DUPLICATE The Assessor has considered this application and taken the following action: 4 Date Auemvr IpM71D SEP 7 1993 ASSESSING DEPARTMENT - BANGOR. MAIM I^ pga'YJIIIFRIEMDS OF TOGETHER PLACE IL1+�1O �:J 150 Union Street ,1F 191993 Bangor, Maine 04401 (207) 941-2907 ASSESSING DEPART1400 August 17, 1993 SANcok mai Mn Benjamin F. Birch, Sr., Assessor Assessing Department City of Bangor 73 Harlow Street Bangor, Maine 04401 Dear Mr. Birch: Thanthe meet today regarding the requestu for ta of�thetFriendse of OTogetherwith me Placerequest top an abatement Of 1992 taxes. The Friends of Together Placa, Inc., is a private, non- profit corporation with a 501 (c) (3( federaltax'status. Their pole is to hold the assets and further the aims of the Together Splace, a treet inBangor.r. I am itsental ExecutivetDirector based at 150 Union go r. am In March of 1992, the Friends of Together Place purchased the property at 9 & 16 Center Street Avenue at a foreclosure sale held by the Fleet Bank. The reason they bought it wasso that it could be rehabilitated by clients of the vocational program at the Together Place and sold to a housing cooperative made up Of people with ohet mental health disabilities at or below the cost to the Friends As soon de1wwere able to put together a financing package, including msfromthe City's Community Development Office, Federal Home Loan Bank of Boston, Maine Bureau of Mental Health, the Maine Realtors Association, and Bangor Savings Bank, we began fixing the houses up in May, 1992. The. first tenant owners were able to move into three of the apartments in December, final unit became occupied in April, 1993. At that point, the houses were sold at cost to the tenant -owners. What little Income the Friends made At "landlords" between December, 1992,and April, 1993 was used to pay utilities and rehab tests. This request for an abatement of the 1992 taxes is based on the following: -- . The Friends of Together Place is a private, non- profit on_profit Corporation, this project was entered into as part of its mission to assist mental health consumers 93-632 live more independently in the community, nity, not for any corporate monetary gain. Nor was any gain realized. D. The Together Place facility at 150 union Street is exempt from property taxes because of the nature of its services and non-profit status. During 1992, the CenterStreet r Avenue property was used i substantially the samemanner - facility to help people with disabilitiesacquire as skills and habits. Several of the workers moved w n togmilar m placements n the c urlty and one vent on to a two year carpentry programat EMVTI. C. The buildings were substantially unoccupied throughout 1992. d. We are n only requesting a e time abatement of all property taxes for 1992. TheTogether Place Housing cooperative is not an -profit agency and is paying property taxes for 1993. e. Despite the fact that we received a deed from the city for this property which was recorded at the Registry in March, 1992, and another from Fleet Bank recorded in April, 1992,we wsent any tax bills for 1992. Two weeks ago, Mr. Robinson notified my office by telephone that liens had already been placed n the property. Upon my request, he was good anough to B end m copy of the liens. Paying over $2,000in back taxes and fines at this point would be a real hardship for either the Friends of Together Placa or the tenant - owners, who simply don't have that kind of money in reserve at this early stage of their existence. Thank you for yoursideration of this request. If you require any more information please call me at 941-2907. S incerel � rjA -r ff'th cc: Bili England, President Friends of Together Place 93-432 MEMORIWDUM August 27 ,�,Fnw 11 la AUG 271993 TOT Ben BiXCht City AnSessOr PROBI; Erik Stumpfelf 'It' RE: Friends of the Together Place PY 1993 sSSMI�� CeARTA42M Taxable Status _ P . I S Center treat Avenue Akw� 11 �, This memo is in response to Four request for a comment on Roger Griffith's letter to you dated August 17, 1993, copy attached. my comments relate only to the properties at 9 and 16 Center Street Avenue. I have no information on the property at 150 Union Street apparently owned by the Friends of the Together Place organization. 9 and 16 Center Street Avenue Were formerly owned by BEcim, Inc., a COXPOration controlled by local attorney Julia DeSanctis. The properties were in a delinquent status for a number of years. The City recorded tax liens for PY 1989, 1990 and 1991 taxes. As of March 1992t FY 1992 taxes were also delinquent. Mr. DeSanctis also failed to keep current on BZCJAH's mortgage with Fleet Bank, Bud Fleet initiated a foreclosure action. In October 1990, the City gave notice of impending form - closure with respect to the 1989 and 1990 tax liens to Mr. DeSanctis, as clerk of BECJAN, Inc., pursuant to 36 MRSA 5 943. The properties were not redeemed. in 1992, the City gave notice to Fleet Bank of Maine to extinguish Fleet's separate redemption rights as mortgage holder in accordance with 5 943. The City's notice to Fleet recited a March 10t 1992 expiration date on Fleet's redemption rights. Meanwhile, Fleet had obtained a judgment of foreclosure against BECJARj Inc. and the redemption period under that judgment had expired. Accordingly, Fleet held a foreclosure sale (auction) on March 2. 1992. On that date, Friends of the Together Place tendered the winning bid of $40,000 for both properties. Fleet conveyed the property to PUTS? by Release Used dated March 6, 1992. That deed was recorded at the Penobscot Registry Of Deads in Volume 5052, page 85, on April 28t 1�992. On March 5, 1992, FOTP paid all Outstanding taxes assessed against 9 a 16 Center Street Avenue, exercising Fleet Rank's redemption rights under 36 MESA 6 943 as an assignee of Fleet. On Monday, March 9, 1992, the City Council approved execution Of a municipal quitclaim dead from the City to "The Together Place- as successor to Fleet Bank, releasing the City's tax -acquired interest In the two properties. (C.O. 92-164 passed under suspension of the rules). A municipal quitclaim deed was issued on March 10t 1992 to "The Together Place- and was sent to the Registry for recording on March 11, 1992. A corrected deadt designating "Friends of the Together Place- as the correct grantee, was issued to PUTT On March 23t 1992. The corrected deed was sent to the Registry for recording on June 51 1992. Based on the foregoing, my opinion is as follower (1) FOTP obtained legal title to the properties at 9 and 16 Center StreetAvenueby virtue of the Fleet Bank release deed dated March 61 1992. Fleet was entitled to convey the property to FOTP by virtue of its prior judgment of foreclosure and the foreclosure sale on March 2, 1992. Accordingly, FOTP held legal title as of that date, even though the deed remained unrecorded until April 28th. 12) The redemption by FOTP on March 9, 1992, as successor to Fleet Back, prevented the City from perfecting tax title to this property. This is confirmed by the Council action on March 90 1992, approving the City's quitclaim of the property to FOTP. Accordingly, FOTP did not lose title to this property prior to April 11 1992. (3) FOTP held legal title to 9 and 16 Centex Street Avenue as of April 1, 1992. Accordingly, FOTP is entitled to a PY 1993 exemption for this property if they are an otherwise qualified charitable corporation der 36 MRSA S 552, and if the properties were "occupied or used- for the organization's charitable purpose. (4) The two properties appear to have been occupied and used by FOTP as of April 1, 1992. That the properties remained vacant on that date is not dispositive. FOTP held theae properties with an active, current intent to convert them to the organi- zation's charitable neer and was taking steps to acquire financing, obtain necessary permits, repair fire damage, and rehabilitate the buildings. Accordinglyr the buildings appear to have been "occupied or used" by FOTP for its charitable purposes within the meaning of S 652. See OsteO thinHas ital fMaine v Inhabitants of the City of Portland, 26 A.2d 641 (1942)9 Camp Each Associates v. Inhabitants of Lyman, 166 A. 59 (1933). (5) FOTP may apply retroactively for an abatement, if it applies, as it has, prior to October 14, 1993. See 36 MRSA SS 652 (1)(A){ 841(1) and my memo on the Acadia Hospital application. (6) Because wa are more than one year beyond the commitment date for FY 1993 taxes, this request must go to the City Council for approval. See 36 MRSA 5 841(1). Because this is an abatement for error or mistake' under S 841(1) and not a tax collection account or poverty abatement or chargeoff under S5 841 (2) or 841(3), this should go to the full Council. See Chapter I, Article 3, Section 6, Bangor City Ordinances. If otherwise qualified as an exempt charitable organisation under 36 SABA S 652(1)(A)r I believe FOTP should be entitled to abatement of FY 1993 taxes on 9 and 16 Center Street Avenue. My recommendation to the Council would be that the abatement be granted. If the abatement is grantedr the City's f1 1993 tax lien should be discharged. rr L- S- B.S. pc: Tom Hicks, Treasurer