Non-profits may close over taxes
Several churches and non-profit organizations in Schenectady may have to close their doors at the end of the month. As Megan Cruz explains, it’s because they are caught in the middle of a dispute about taxes those groups say they shouldn't even have to pay.
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SCHENECTADY, N.Y. -- "Sleepless nights, not knowing if the next day, not knowing if the next day I'm going to come in and the locks are going to be changed on the doors," said Reverend Eloy Binnon of New Creation in Christ Ministries.
Reverend Binnon says the possibility of this happening has plagued him since 2009, when he first got word his property was sold by the city of Schenectady to American Tax Funding. ATF is a private company that buys up delinquent tax liens and they're coming to collect by the end of this month.
Binnon said, "Why is it that we're required to renew our status every year when this is the only county in the state of New York that does that?"
The status the Reverend's referring to is his church's tax exempt status. According to the city, the church forgot to file the forms to keep this status. Binnon's church is one of 18 nonprofits that the city sold to ATF as a result.
"When they did not do that, taxes were imposed. In the normal course of the city's dealings with ATF at the time, there were sales of tax liens from a number of properties. Could be several hundred as a group that were sold to ATF for a lump sum," said John Polster of the Schenectady Corporation Counsel.
People at ATF say they only recently found out the city shouldn't have sold them these 18 liens when two of the property owners contacted them. They said when they knew the situation…
"We offered to sell them back these liens at significant discounts. We’ve offered more times than you could shake a stick back to sell these things back to them. They have steadfastly refused," said ATF CEO Matt Marini.
Marini says they'd give all the liens back for $500,000, but...
Polster said, "Cash flow now is a difficult item."
"Exchange them. We went as far to say look, you don't have to give us cash. Just give us other liens," said Tadgh Macaulay, ATF VP.
"There are ongoing negotiations between the city and ATF," Polster said.
Of the 18 nonprofits, ATF says they've already foreclosed on one, the Hindu Temple on Pleasant Street.
Binnon says he prays his church isn't next.
"Just have to trust in God now and believe that somebody somewhere would step up and say we want to help and get forward with this situation," Binnon said.
According to Polster, the city council hopes to discuss this further in executive session Monday.