City waives unpaid assessments on vacant property
City Commissioners voted unanimously during their May 16 meeting to waive about $30,000 of assessments on a vacant property at 209 2nd Ave. N.
Trevor Cavanagh of Smoked made the request on the property, which is next to his restaurant, as he’s attempting to purchase the property to expand their business at their current site.
No one spoke in opposition to the request during the meeting.
Jolene Schalper of the Great Falls Development Authority said they supported the action since it would help get the vacant property back into use.
Commissioner Rick Tryon moved to approve the request.
A structure on the property was condemned by the city building official in 2006.
The city required the owner to obtain a permit to repair or demolish the structure within 60 days. At the time, the owner was Vilma Herrera, which filed for bankruptcy, and during that process, at the direction of the U.S. Bankruptcy Court, the city secured the structure on the property, according to the city staff report.
The city incurred costs in securing and cleaning up the property, as well as demolition of the structure in 2008, according to the city.
In 2008, the City Commission held a public hearing and adopted a resolution to recover clean-up costs for $1,628.79 and a resolution to recover demolition and clean-up costs for $28,700.
The city placed a lien on the property for those costs, totaling $30,328.79.
In 2007, the property was returned to the lender holding the deed of trust for the property, but changed hands five times in the following three years, eventually ending up with FFLM Investments, a company with a Pennsylvania address, according to the city.
No property taxes have been paid on the property since at least 2007, nor has the city’s lien been paid, according to city records.
The city’s liens, with penalties and accrued interest, now total nearly $77,000, according to the city.
Another company attempted to take assignment of the tax liens by paying the outstanding taxes in 2018, but backed out when it discovered the city’s liens are treated as unpaid assessments and included with the tax amount to be paid to receive an assignment, according to the city.
Cavanagh has sent certified notice of his intent to take assignment of the tax lien certificate issued by the county treasurer for delinquent real property taxes, which is the first step in obtaining the property through the tax deed process, according to staff.
After the certified notice, Cavanagh would have to pay all delinquent taxes, assessments, penalties, interest and costs, which is why he requesting the release of the city’s lien and waiver of city assessments, according to staff.
Currently, the amount necessary to take assignment of the tax lien on the property is $81,768.58, of which the majority is the city’s demolition and clean-up costs, according to staff.
There’s about $4,161 in unpaid property taxes, according to staff.
In 2018, the county struck the past-due property taxes for 2007 through 2016, to “render the property more amendable to assignment and development,” according to city staff.
In 2020, Cavanagh obtained an appraisal of the property, which indicated a value of $22,000 and the 2023 taxable value is $41,085, according to staff.
“To be clear, the process to ultimately obtain a tax deed to property is long and technical, and each step must be followed precisely for the tax deed to be valid. Thus, there is no guarantee Mr. Cavanaugh will ultimately receive title to the subject property. If the commission votes to waive all or a portion of the city assessments, the waiver would ultimately benefit anyone who successfully navigates the tax deed process,” according to city staff.
By approving the action, the city forfeited its ability to recover its cost from abating the property in 2008.
But since that time, the city has not received any recovery of its costs, “and the size of the lien, along with the costs and risk associated with a tax lien assignment, greatly exceed the value of the subject property, making the prospect of recovery slim,” according to staff.