MALONE — Malone is investing more in its legal fund to fight off corporate property-tax challenges that leave local property owners paying more in taxes.
In the 2014 tentative budget, Budget Officer Andrea Stewart has placed eight times the amount of money she set aside this year for judgments and claims, growing the account from $3,500 to $24,500.
“I did build in an increase in legal fees because you can’t just settle,” she said. “You have to fight the larger entities who are working to pay as little as possible because it costs the taxpayer.”
Two recent Certiorari proceedings have been brought against the town, challenging the property assessment at the U.S. Border Protection building and also Walmart.
Town Assessor Amy Hewitt said the Border Patrol barracks on Route 11 was originally assessed at $11,857,000, but the assessed value was lowered to $8.5 million in a settlement reached before the case went to Franklin County Supreme Court.
The agreement stipulated a refund for $27,000 in overpayment of taxes, which was split up across two years at Stewart’s request.
The first payment of $10,150 was made in July, and the balance will be paid in the 2014 budget, the budget officer said.
Walmart’s challenge came in 2011, when its assessment was reduced from $13,972,000 to $12 million, Hewitt said.
There was no refund to Walmart because one wasn’t sought in that agreement, she said.
Kmart files an annual challenge to assessments on its two parcels. The store itself is assessed at $3 million, and the rest of the shopping center it sits on is assessed at $3.5 million, Hewitt said.
“Kmart does this every year, but it’s gone nowhere with them,” she said. “They are notorious for this. They litter the state every year in hopes of getting somebody to come down somewhere.
“It’s with the town attorney now and is an open-ended case.”
Kmart has not had a revaluation since 2005, she said.
In a similar legal proceeding filed against the town, Malone Town Houses Inc. is seeking restoration of an exemption it enjoyed for the Indian Trails housing complex on Finney Boulevard.
A hearing is set for 9:30 a.m. Friday, Oct. 18, for the parties to appear at the County Courthouse.
Built in 1974 using $2,481,000 in funds from the State Urban Development Corp., Indian Trails was supposed to receive a 10 percent exemption from real-estate taxes.
But Hewitt removed the exemption in March because “I don’t believe they are entitled to it because the original mortgage has been refinanced, and that’s not allowed under state law.”
‘TOO MANY GRAY AREAS’
She said the property has been entered incorrectly on the town’s tax rolls as wholly exempt since it was built, so the owners hadn’t been paying anything beyond a shelter rent — a stipend of 10 percent above what it receives in rent payments.
“I took it away because of all of the questions I had,” Hewitt said. “I don’t think they are entitled to it anymore.
“There were too many gray areas, and that’s what we’re researching now,” she said, referring to her office and that of Town Attorney Lillian Anderson-Duffy.
“Did they think it was going to go on indefinitely? Really? It’s ridiculous to think they could have it go on,” the assessor said.
“They pay a shelter fee, but who do they have to prove it to? I don’t get proof of anything all year ...
“We’ll go to court and hope we win.
‘TIME TO HOLD GROUND’
Attorneys for Indian Trails say they didn’t know the exemption was removed until the town-and-county-tax bill arrived on Sept. 1.
Court documents filed by Attorney Brian Stewart of the Malone law firm of Hughes, Stewart and Race state that the current assessment is $4,162,700, but the corporation didn’t contest it with the Board of Assessment Review because it wasn’t notified about the exemption loss.
Hewitt said she checked with the County Real Property Tax Service, which advised her that she had no obligation to make that type of notification.
This proceeding is part of the reason Andrea Stewart added extra funds to the town’s budget line item.
And she believes Franklin County, the Village of Malone and the Malone Central School District could join with the town in its efforts to fight back since they are all impacted by the tax losses, too.
“All of these corporate entities use our services and have teams of lawyers to get around the exemptions the state created,” she said.
“And when a business pays a minuscule amount of tax under Payment in Lieu of Taxes plan, that makes everyone else pay more.
“There comes a time when you have to hold your ground,” Stewart said.
Email Denise A. Raymo:firstname.lastname@example.org