Questions raised over property owner who owes nearly $1M in taxes
Unpaid property taxes and an ongoing battle between the property owner and the county have caused a deficit of nearly $1 million to Chautauqua County taxpayers over the course of the last 20 years.
At last month’s meeting of the County Legislature, a resolution was discussed concerning six of 23 parcels in tax foreclosure owned by Merle Elderkin of Gerry.
Outstanding taxes on the six properties totaled $556,319.15.
Elderkin made an offer of $221,332.38 on April 30 for four of the parcels, leaving the other two with an outstanding tax amount of $336,918.37.
At that time, Jim Caflisch, director of real property taxes, suggested the legislature reject the offer and package all six parcels of land for sale at the tax foreclosure auction on June 21.
According to Elderkin’s daughter Raynal, the offer for the four parcels had been accepted until the legislature voted against it in May.
These types of situations require legislature approval.
The two parcels of land Elderkin did not make an offer on were once used as part of a farm operation along with the other four parcels.
“If Mr. Elderkin were to acquire these two parcels and make it a farm operation again, it would have been an acceptable situation for us,” Caflisch said. “We need to use some discretion here to see what the best use of these properties are for the county. That was problematic for me as the tax director to look at this, as well as thinking ahead to county taxpayers.”
Elderkin is the former owner of five properties in Ellicott, five in Stockton, six in Gerry and five in Sinclairville, totaling 361 acres. These 21 properties will be auctioned off on June 21.
While his April offer for the four parcels was denied, $118,483.14 was accepted by the county in order for Elderkin to maintain his home in Stockton and a small piece of property totaling 172 square feet located on Route 60 in Gerry.
Questions have been raised as to how the process was drawn out for more than 20 years.
According to Elderkin’s daughter, he fell behind on his taxes, eventually filing for bankruptcy twice in the past 21 years. The bankruptcies, combined with other legal actions, slowed down the foreclosure process, according to Caflisch.
Furthermore, Elderkin had consolidated the 23 parcels as one group.
“As soon as a property goes into bankruptcy, the actions are severed from the foreclosure process,” Caflisch said. “We can’t move on them, but the taxes continue to accrue.”
Elderkin’s daughter said roughly $300,000 was paid to the county over the course of the bankruptcies, but the amount was never applied to the taxes, at which point Elderkin hired an attorney and took the county to court.
A Supreme Court memorandum from 2013 noted that amounts paid by Elderkin has been properly credited to the tax liability. However, the amounts paid were only partial payments of taxes for the properties, of which the county is obligated to accept.
Raynal Elderkin said she felt misled throughout the process of trying to settle the unpaid taxes, especially after the offer of $221,332.38 for four of the six parcels was denied.
“The offer for the four parcels was not representative of the true value,” Caflisch said, adding that the additional two parcels would be necessary in order for a farm to operate on the land. “He was looking to keep the best, most productive properties and walk away from the others. From looking at our situation, it’s a significant problem for the county to keep holding these properties if the production acreage were to be split apart.”
Raynal Elderkin also said Caflisch had made a comment that he would make Merle Elderkin the “poster child in Chautauqua County for what happens if you don’t pay your taxes.”
“I was offended by him saying that, especially after what my dad did – he did what they said to do, and they denied it,” Elderkin’s daughter said. “It’s just like he’s being targeted because of who he is.”
At the 2014 County Tax Foreclosure Sale on June 21 at Chautauqua Lake Central School in Mayville, 21 of Elderkin’s properties along with 263 other county properties in foreclosure will be auctioned off.
Caflisch said he expects the properties will receive significant interest from bidders.
Raynal Elderkin said many of them are rental properties, and that the taxes are higher than what the properties are worth.
Caflisch said it is the responsibility of the buyer to evict the current renters, unless an agreement is reached.
“When we go to sell the agricultural property, we are going to offer it in different phases, starting at noon,” Caflisch said. “People get a chance to bid on the parts they really want, then we roll it all together at the end and the new starting bid will be the sum of what the different parcels were offered for. That will hopefully keep this working farm operation together.”
If the parcels of farm land are not sold for one sum, they will be sold separately.
Merle Elderkin will have the opportunity to bid on the day of the auction, and he must bid at least the amount of taxes owed.
“Because we have a million-dollar situation, it’s really critical that we be able to market this property and have the best opportunity to recover for the taxpayers of the county,” Caflisch concluded.