Why doesn’t Saratoga Springs collect its back taxes?
A review of taxes owed shows millions – yes, that’s right, millions – of uncollected, delinquent taxes.
As most Saratoga Springs city homeowners prepare to pay their 2019 second quarter property taxes in the coming days, a surprisingly large number of taxpayers simply will not pay their taxes and, based on past experience, they probably see no reason why they should.
A review of delinquent real property taxes in the spring of 2018 revealed nearly $2,700,000 owed to the City by nearly three hundred taxpayers. A more recent update of back taxes through the City website (https://secure.saratoga-springs.org/MSS/citizens/RealEstate/Default.aspx) and Image Mate Online (https://saratoga.sdgnys.com/search.aspx) finds that, while some of these bills have been paid, albeit late, most of the largest older bills not only are still open, but taxpayers have not paid subsequent bills either. Thus, the outstanding tax with accruing penalties is now very likely well over$2,700,000 and climbing*.
As in most municipalities, Saratoga Springs places a lien on properties with taxes older than two years. Unlike most other municipalities, however, Saratoga Springs seems not to have foreclosed on any of these delinquent taxes. So, unless property owners need the property to be clear of any liens to obtain a mortgage or sell the property, they have no incentive to pay anything. In just a brief review of properties belonging to four taxpayers, the total taxes owed totaled nearly $250,000, with taxes due as far back as 2009. Each property was subject to multiple liens and not onehad been enforced by tax foreclosure.
One taxpayer of particular interest in this group is the beneficiary of long-standing contracts for services to the City. This individual owes to the City of Saratoga Springs and the City school district no less than $137,000 in back taxes, covering a total of nine lots throughout the city. The City has placed tax liens on this individual’s properties (yes, every single one) for taxes due as far back as 2009. Again, none of his parcels has had the tax liens foreclosed, uncollected taxes continue to accrue penalties and fees, and contracts continue to be awarded.
The full market value on the City rolls of these nine lots is over $1,300,000 and the owner operates thriving businesses on several of them. Other parcels are vacant; however, these lots are of significant value as they are located in residential districts of the City. Should the City seek to enforce these tax liabilities by foreclosing on the tax liens, the taxpayer in question could sell just one of the vacant parcels and pay off the entire delinquency to the City without hurting any existing business.
There has been an occasional payment and this seems to be good enough for the city, since, as mentioned, the city still awards this taxpayer exclusive contracts. So, why should this individual pay his taxes? What is the incentive to pay if there is no enforcement for non-payment and, indeed, the City is willing to continue to contract for services with him despite these delinquencies?
Another delinquent taxpayer who owns an apartment building in a part of the City generally considered “affordable housing” has seventeentax liens on the property dating from 2010, totaling over $80,000 in back taxes, fees and penalties. These delinquencies prohibit the owner from obtaining financing to upgrade or renovate the property, so one wonders how the owner finances maintenance of his properties to keep them within code?
Non-payment of taxes damages all of us as residents of the City of Saratoga Springs. While we have heard proud reports of the supposed City budget surplus, the uncollected revenue of at least $2,700,000 could more than double our current, reported surplus, and, yet, there is no effort to collect it. This revenue could have paid for the EMS station on the eastern ridge. It could be used to update the infrastructure of the water system. It could have offset a portion of the underinsurance on the City Hall repairs, which the city will have to borrow. Instead, these uncollected taxes represent an unfair burden on the majority of taxpayers who do pay their taxes in full and on time. Even-handed enforcement of the collection of City taxes, including foreclosure of tax liens, is critical to the growth and stability of Saratoga Springs and ensures all taxpayers share equally in contributing to the future of our city.
* This figure includes both City and Saratoga Springs School taxes, but does not include utility bills levied against real property
**Adapted from http://clipartmag.com/tax-cliparts#tax-cliparts-44.jpg