Mount Vernon real estate committee reviews tax-cost calculations for six foreclosed properties, votes to enter executive session

The Mount Vernon Real Estate Committee on Jan. 31, 2025 reviewed detailed tax, interest and cost calculations for six city-owned properties that were foreclosed and discussed next steps for bids and conveyances. The committee voted to enter an executive session to consult with attorneys about the legal issues raised by a recent state court decision and related changes to state real property tax law.

Committee Chair Daryl Morton said staff had produced three parallel calculations for each property: (1) total taxes, interest and charges from the time the account went delinquent to the present; (2) the amounts outstanding at the time the city foreclosed; and (3) the foreclosed amount plus taxes the city paid on the property after foreclosure (excluding interest not charged to certain levies). "We've begun to calculate those costs, starting off with the properties we deemed are of imminent importance," Morton said.

Morton presented figures for several properties during the meeting. For 224 North Seventh Avenue he reported a total since delinquency of $581,005.56 and a foreclosed amount of $79,005.91. For 467 East Fifth Street he reported a total since delinquency of $333,006.17 and a foreclosed amount of $60,007.96. Morton said staff has completed calculations for six properties identified as phase 1 and that some of those properties remain occupied by family members or other occupants.

Morton and staff said the calculations were performed to respond to the legal effects of a recent court decision referenced in the meeting (identified in the transcript as "Tyler v. Pennington") and an amendment to the state real property tax law (cited in the meeting as "section 11-66"). The committee discussed whether amounts paid to other tax levies after foreclosure should be included when computing sums owed or surplus to be returned to a former owner; Morton said the question remains under legal review.

Members and several in-person commenters who had submitted bids or inquiries attended the public-comment portion. Jorge Ybarra identified himself as a bidder seeking an update on an offer for 240 Seventh Avenue. Cynthia Vara and Jorge Vara also spoke to confirm the status of their bid for 224 North Seventh Avenue. A staff member confirmed that bidders and interested parties who submitted offers will be notified when a special meeting is scheduled to consider conveyance recommendations.

Morton said staff had been collecting historical appraisals, using those appraisals plus the new calculations to establish an evaluative standard for offers, and that the committee must decide whether to proceed with negotiated sales, an auction process, or some other route. He recommended closing the window for additional bid exceptions so the committee can move forward; the committee chair said staff will set and announce any formal cutoff for bids and will notify interested parties.

During discussion a committee member asked whether the calculations include expenses the city paid for demolition or repairs; Morton said some hard costs are being tracked now but that historically many such costs were not recorded comprehensively.

The committee agreed to hold a special meeting to consider conveyance recommendations for the six properties once legal questions are resolved. The meeting will provide notice to bidders and potential heirs identified in offer letters so they may appear.

The committee then moved into an executive session to consult with legal counsel about the implications of the court decision and its application to the city’s calculation method and next steps. A motion to go into executive session carried on a roll call vote recorded in the minutes as Controller Martin — Aye; Assessor Vanden — Aye; Council President Brown — Aye. The minutes record the motion as approved and the committee convened the executive session later in the meeting.

Clarifying details, documentation and the final set of calculations will be included in the committee minutes; Morton said finalized figures will inform any recommendation to the Mount Vernon City Council about conveyance or sale of the properties.