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State remediated properties may return to St. Lawrence County tax rolls

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CANTON — A model is in the works with the state for St. Lawrence County to put tax-delinquent, environmentally impaired properties back on the tax rolls.

“In concept, the state has agreed where it would receive some money in return for releasing us from liability,” County Attorney Michael C. Crowe said. “They have said they’re agreeable in principle to what we’re doing.”

The county has a number of tax-delinquent properties contaminated by petroleum products. Under the state’s environmental laws, the county could be responsible for cleanup costs if it takes title through foreclosure.

The county, with the assistance of its environmental attorney, Gary S. Bowitch, and approval of Treasurer Kevin M. Felt, identified six tax-delinquent properties where the state Department of Environmental Conservation paid for cleanup using oil spill funds or money reserved for leaking underground storage tanks. The amount of money spent included a low figure of $40,523.27, but the cost of cleanup for two properties was in the hundreds of thousands of dollars and two others exceeded $1 million.

At the same time, the county is losing tax revenue while making municipalities whole for their lost taxes, sometimes above the assessed value of the properties involved.

For example, the state paid $1.7 million to clean up the Deleel site, 753 County Route 48 in the town of Stockholm. The assessed value of the property is $22,000. The county has lost about $13,000 in tax revenue, not including penalties, interest and fees, and has paid the town almost $10,000.

“Without doubt, therefore, there is great incentive for the county to take title to these sites in order to ‘stop the bleeding,’ sell the properties at a tax auction and return them to the paying tax rolls,” Mr. Bowitch wrote in a report presented to legislators.

In October, Mr. Bowitch and Mr. Crowe met with representatives of the state attorney general and Oil Spill Fund when the county proposed making a payment to the Oil Spill Fund in exchange for a release of past and future liability.

“This release would be structured so that it would also run to and be of a direct benefit to the purchaser of the site at the tax sale, as a means of incentivizing the sale of these former spill sites at a tax auction,” Mr. Bowitch wrote.

The release would not extend to former owners, Mr. Crowe said.

“This settlement doesn’t extinguish the state’s claim against whoever they want to pursue up to the time of purchase,” he said.

Nor would future buyers be released from responsibility for any environmental contamination that they cause after taking ownership.

The county has offered to pay the Oil Spill Fund 50 percent of the auction sale price for each property, including a nominal “down payment” for each site that ranges from $500 to $2,500 for the release from liability.

If the down payment was more than 50 percent of the auction price, it would be the total amount paid by the county.

While the down payments are small, the properties might not attract any bidders, Legislator Kevin D. Acres, R-Madrid, said.

“We don’t have any bidders now,” Mr. Crowe said.

However, the county’s prospects for getting the properties back on the tax rolls are improved, he said.

In addition to the Deleel site, properties that could appear in the October tax sale are Johnson/Pelo, 6982 Route 3 and 16 Riverside Drive, town of Clifton; Newcombe, 4390 County Route 10, town of DePeyster; Bush, 35 Main St., Brasher, and Champney, 1771 Route 72, Parishville. A sixth site, Podunk, at 4275 Route 11, DeKalb, requires more information about a subdivision and sale of a portion of the property before a settlement offer can be made.

If successful, the program could be extended to other tax-delinquent remediated property but a better solution might be for the state to broaden its municipal liability exemption to extend to parcels contaminated by petroleum, Legislator Daniel F. Parker, R-Potsdam, said.

“I don’t see this as a long-term solution,” he said.

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