7/27/07 - Sale of Stewart Place house draws criticism

(As published by Cortland Standard, Corey Preston reporting)

A resolution to essentially forgive a $70,000 lien on a now-vacant house on Stewart Place became political fodder at Thursday’s Legislature session before it was ultimately pulled to allow the county to deal with the lien through proper legal channels.

Kathy Wilcox, a Republican challenging incumbent Ron Van Dee (D-5th Ward), criticized Van Dee during the public comment portion of the meeting for pushing the dissolution of the lien, while Van Dee said he was only anxious to see the property at 17 Stewart Place, which owes $11,000 in back taxes, again paying taxes.

The property, vacant since 2001 and assessed at $48,300, has a $73,000 lien imposed on it by DSS due to Medicaid costs incurred by previous owners Clifford and Verna Lowell, who are now deceased, according to DSS Commissioner Kristen Monroe.

DSS has acquired the mortgage on the property because of the lien.

Van Dee had pushed for legislative intervention on behalf of Aloi, who has agreed to purchase the property from the daughter of the previous owners, Mary Helmer, but needs to have the lien satisfied in order to do so.

Aloi declined comment Thursday, but last week after a meeting of the Budget and Finance Committee she said she had purchased the house without knowledge of the lien, had already taken steps to renovate it and was now in limbo waiting for action from the county.

According to both Monroe and County Administrator Scott Schrader, when a buyer for a vacant property with a lien emerges, DSS is required to seek compensation in order to settle the lien, because 90 percent of the money owed for the lien is actually Medicaid owed to the state and federal governments.

The owed taxes take precedence, Monroe said, and Aloi and the daughter of the previous owners were prepared to pay the back taxes out of the sale price, but the issue became determining an acceptable amount to dissolve the lien.

“There’s a procedure that has to be followed, it can’t be ignored,” Schrader said. “If there’s any value to this property, it has to go towards the lien, that’s the requirement.”

Monroe said that typically in situations like these, DSS seeks an independent appraisal of the property and subtracts the taxes owed to the county to determine an amount that would satisfy the lien.

Monroe had been waiting for an appraisal of the property and said Thursday she had just received an appraisal based on the outside of the building of $50,000.

Based on that appraisal, $11,000 would be owed to the county for back taxes, and $39,000 would satisfy the lien, however Monroe noted the appraisal was likely flexible and would be subject to negotiation between DSS and Aloi’s attorneys.