Source: http://www.watertowndailytimes.com, October 28, 2014
By: Ted Booker

To foreclose on a tax-troubled North Main Street property in the village, Jefferson County soon will choose either to pay the state Department of Environmental Conservation about $160,000 for clearing it of contamination, or wait for the state to claw back that cost from the property owner.

The county is deliberating its options after the state took action in early October by hiring a contractor to clean up soil contamination and remove a pair of underground gas tanks at the three-acre lot, which has buildings occupied by tenants at 8728 and 8740 N. Main St.

Tenants lease apartments from Mark T. Brand, the property’s presumed legal owner, who owes the county $220,551 in property taxes and water and sewer bills dating back to 1992. Mr. Brand — a former Indian River school board member who has been superintendent of Indian Lake Central School District in Hamilton County since 2003 — has argued that he is not the legal owner of the property and admitted that he throws the tax bills away.

Eggan Environmental Services of Rome last week finished clearing out about 2,000 tons of contamination from the site, where a gas station once operated, said Gary P. McCullouch, DEC regional spill engineer. The DEC initially projected the project would cost $100,000 or less, but that total climbed when more contamination than expected was found, he said.

The DEC decided to clean up the property this fall after the county considered doing so on its own. In the spring, the county conducted an environmental assessment to determine whether it could be affordable to clean up the lot and foreclose on it.

Mr. McCullouch said that if the county decides to foreclose on the property, the DEC would be willing to negotiate to reduce the price of the cleanup that the county would be obligated to pay. He could not estimate how much the total project cost could be reduced.

“In a case like this, if the municipality steps in and wants to acquire the property and resolve the liabilities that are there, they can negotiate something with the DEC. That’s done on a case-by-case basis, and there are a lot of factors involved,” Mr. McCullouch said.

The DEC’s funding for the project was secured from the New York Environmental Protection and Spill Compensation Fund.

If the county decides not to take over the property, the state attorney general’s office will decide who will pay for the cleanup, Mr. McCullouch said. In some cases, former owners of contaminated properties are held responsible for the cost.

“The state is trying to get as much money back as possible. But more importantly, there’s a philosophy that the polluter has to pay for the pollution that’s there,” he said. “There’s always an attempt to recover money from the discharger — or at least a portion of it.”

Officials have said Mr. Brand probably would be targeted by the attorney general’s office for the cleanup cost. The North Main Street property was bought in 1985 by Romark Construction Co., Inc., whose principals were Mark and Robin L. Brand. The Evans Mills couple bought the property from John E. Bevens, who operated a gas station there. Romark went bankrupt in 1996 and dissolved in 2001. The county, meanwhile, continues to send tax bills to Romark, which has an Indian Lake post office address in care of Mr. Brand.

According to Jefferson County Attorney David J. Paulsen, the Brands presumably became the owners of the property in 2001 when they voluntarily decided to dissolve the corporation. When shareholders dissolve a corporation “by proclamation” under state Corporate Business Law, as the Brands did, they usually assume ownership of the corporation’s assets.

COVERING CLEANUP COST

County officials are anxious to foreclose on the property, but only if they can sell it for more than the cost of the environmental cleanup. And they’re anxious for a good reason: Until it forecloses, the county will continue to be responsible for paying property taxes and water and sewer bills assessed by the village, along with property taxes assessed by the town of LeRay and the Indian River Central School District.

The county’s stressed property committee will meet this morning to discuss its strategy for potentially foreclosing on the property to get it back on the tax roll, said committee Chairman Robert D. Ferris, a member of the Board of Legislators. He said the county will probably seek to negotiate down the DEC’s cleanup price to a figure that would enable the property to be sold on the market for a greater amount. The property was assessed by the county this year at $175,300.

Depending on the environmental cost, “we’ll decide if we want to go after it and foreclose on it,” Mr. Ferris said Monday. “I think it’s a marketable property that I wouldn’t put through a tax auction, but put through a Realtor to sell. I think the property could be worth doing it, but we’re going to push forward and find out.”

The committee will probably decide to hire a Realtor to conduct an appraisal of the property to find out how much it would be valued at on the market with a “clean bill of health” from the DEC, Mr. Ferris said.

Mr. Ferris said the attorney general’s office would probably have a challenging time compelling Mr. Brand to pay for the environmental cleanup. Yet the county could decide to pursue that course if the committee agrees the cleanup would be too costly.

“I wouldn’t see Mr. Brand paying for the environmental cost, because he still owes us the back taxes and we’d foreclose on it,” he said. “But it would be awesome if the state came in and said, ‘Mr. Brand, you need to pay us within 30 days.’ Hopefully we’ll have all of the options laid out by our attorney, and sometimes sitting and waiting is the best option. What we want is for Mark Brand to clean the property up and pay the taxes he owes to make us whole, but it’s highly unlikely that’s an achievable goal.”

Paul J. Warneck, director of Jefferson County Real Property Tax Services, said Monday that the county’s decision will depend on how low the environmental cleanup cost of the property can be negotiated down. If the DEC is unwilling to negotiate, it would be cost-prohibitive to pay DEC’s $160,000; the county would be better off waiting for the state attorney general’s office to claw back funding from Mr. Brand, he said.

“I think we need to try to negotiate some sort of settlement on the cleanup, and then move forward with marketing the property and get an appraisal to determine where the numbers are going to fall,” said Mr. Warneck, who attends meetings held by the stressed property committee. “We won’t know what number we would be willing to pay until we have a good idea on what the market value of that property is going to be.”

Other members of the committee are Scott A. Gray and James A. Nabywaniec, both county legislators.