If you're a delinquent taxpayer, there is a fine line in Ontario County, N.Y., between losing your property and keeping it. In this case, that line is in Rushville.
The village straddles Ontario and Yates counties and the difference in their foreclosure policies can make all the difference for a taxpayer in arrears. Eric Lundquist is at the center — in more ways than one — of a debate over Ontario County's strict policy on foreclosure. While the chairman of the Ontario County Board of Supervisors and county treasurer say the county has no plans to change its policy, two people with a stake in the game say the county should give taxpayers a break, like other counties do.
And Lundquist isn't the first to take Ontario County to court over its foreclosure policy, with mixed results from past cases.
If Lundquist's property at the intersection of Railroad Avenue and Water Street in Rushville was on the Yates County side of the village, he wouldn't be facing foreclosure, at least not yet.
But because the warehouses where Lundquist once operated his restoration company Document Reprocessors are in Ontario County, the 15-acre site assessed at more than $400,000 is headed to the county's tax foreclosed real estate auction May 17.
At issue is the 2015 property tax bill that was due in January. Ontario County offers no redemption period after the due date, while many other counties do. Yates — just over the border — is one of them.
Yates County Treasurer Winona Flynn said delinquent taxpayers in Yates can pay their bill up to 30 days before the June 22 county auction, or up until May 22 to redeem their property.
Although its strict policy has landed Ontario County in court numerous times -- including now, with Lundquist -- county officials have no plans to change it.
When the property tax bill arrives in January, property owners have to pay it, said Jack Marren, chairman of the Ontario County Board of Supervisors. Marren, who also is Victor town supervisor, said the county isn't even talking about the issue.
When the taxes aren't paid within the time period, you can feel sympathetic, he said.
"It's too bad. We are sorry but..." Marren said, adding he agrees with the policy. "We are consistent."
The Lundquist story
A California resident, Eric Lundquist started Document Reprocessors about 30 years ago.
The company uses a patented technology to salvage and restore smoke- and water-damaged books and other materials. Customers include the Library of Congress, major businesses and private and government agencies.
Restoration of Titanic artifacts are among the company's high-profile projects. Areas hard hit by floods and hurricanes have called on Document Reprocessors to restore books and documents with its freeze-drying technique. In 2013, the company restored books from two floors of Wood Library in Canandaigua after a pipe burst. The company operated its East Coast site in Middlesex for years, was at the Rushville site for about 15 of them and now operates locally in Penn Yan, Yates County.
Lundquist on Jan. 25 was ready to write a cashier's check to pay the $15,000 his office manager posted as due in taxes and fees on the Rushville property, he said. They thought the due date was the end of the month, Jan. 31. Instead, it was Jan. 13. (Ontario County uses the Friday before the Martin Luther King Jr. Monday holiday as the tax due date, which fell on Jan. 13).
When they learned the date was past, Lundquist said his manager was told "the owner could buy the property back at auction in May."
"What an outrageous way to handle this. It left her in tears," Lundquist said. "I didn't realize the seriousness of not paying the taxes, as my family and I are lifelong residents in California. We don't have these unfair laws in California."
Lundquist said he appealed the county's action in court and lost, as Ontario County Court Judge Frederick Reed ruled the county had done everything correctly. Lundquist said he is continuing to push for a reprieve, both in the courts and through letters to local officials. So far, to no avail.
"The crux of the issue is not that Ontario County didn't follow the letter of the law," he said, "but they are being unjustly enriched as a result of their action."
Lundquist said he thinks it's criminal for the county to seize his property, which he said is worth $1.5 million, because he failed to pay $15,000 owed in taxes and fees.
In court, Lundquist said his attorney argued the county gave the wrong address for the property.
Lundquist gives the address as 40 Railroad Ave., while the county gives 18 Railroad Ave. Lindquist believes this should have helped his case but it did not. Lundquist said the address discrepancy caused his bank, which received two notices, from tying his mortgage to the property. His bank acknowledged it would have paid the taxes if the address had matched, Lundquist said. He said that since the county seized his property, he still will have to pay the $500,000 mortgage, in addition to about $2 million in attorney fees.
One of many
The Lundquist property, listed as 18 Railroad Ave. in Rushville, is one of 24 properties Ontario County plans to sell at the auction to be conducted by Auctions International Inc. on May 17. The brochure describes the site as a "very large commercial factory" with "multiple suites and numerous large garage bays" with "several large outbuildings," about six loading docks. ... "Very large facility! Tons of potential!" Total assessment is $413,700. Taxes due upon purchase are $12,292.
Also on the list is 9097 County Road 14 in West Bloomfield.
The 50-acre lot with house, barn and outbuildings is assessed at $187,000. Taxes due upon purchase are $7,534.63. Michael Carpenter, who lives in Canandaigua, said his girlfriend, Cori DuVall, owns the property. He said DuVall doesn't live on the property and due to family troubles wasn't aware of the January tax due date until it was too late.
While the county may have followed the law regarding notices, Carpenter said he thinks it's wrong for the county to deny property owners the chance to redeem their properties before the county sells them. Carpenter said he is familiar with how other counties handle foreclosures by allowing a redemption period.
Ontario County stands to gain while property owners like DuVall will "have lost everything," a situation that Carpenter calls "disturbing."
A history of court cases
Ontario County Treasurer Gary Baxter last week outlined how the county handles billing for property taxes and the multiple steps taken to reach property owners in arrears.
During the two years a property owner has to pay before foreclosure, Baxter said the process includes about 10 notices sent out at various intervals and a certified letter mailed out some three months before the due date. Baxter said he also makes house calls and visits properties to reach people at risk of losing their properties.
Despite the efforts, Ontario County has been in court numerous times over foreclosures.
In 2007, foreclosure of the Akropolis Family Restaurant in Hopewell led owner Krystine Hetelekides to sue the county over the sale, claiming it mishandled the foreclosure process. Hetelekides wanted to pay the $22,110 in back taxes she owed at the time of the sale and recoup the $160,000 plus interest and other expenses.
Instead, a relative of Hetelekides bought the establishment on Routes 5 and 20 at the auction on her behalf for $160,000. The case dragged on after a state Supreme Court justice denied the county's attempt to have the case dismissed and the county appealed the decision.
In another case, a South Carolina man was able to keep his wooded parcel off Monks Road in Canandaigua after a state appellate panel overturned a previous ruling that would have allowed Ontario County to auction the parcel over a mere $24 the man owed in interest.
Lundquist said he will continue to fight for his property.
"I am a taxpayer here," he said, adding that at one time he employed 50 people at the Rushville site and has always paid his bills.
But, "this could force me into bankruptcy," Lundquist said.
