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Judge Carney Stays Foreclosure on Episcopal Church Home

Another stay of execution in City Housing Court last week on the vacant Episcopal Church Home buildings and property near the Peace Bridge. Judge Patrick M. Carney ordered a 90-day stay on foreclosure on the long-abandoned property in light of a new plan to sell to Empire State Development Corporation.

Ultimately, the idea is that the property would go to the Public Bridge Authority for its proposed expansion of the Peace Bridge plaza. Six months ago, Governor Andrew Cuomo announced an agreement for the state—through the New York State Department of Transportation—to buy the property from the Episcopal Church Home for $4 million. In conjunction with the state purchase announcement, the PBA agreed to pay off tax arrears on the property. That was supposed to happen by January 2, 2013. It didn’t. Why? Because the state deal didn’t happen, according to Peace Bridge general manager Ron Rienas. “We weren’t about to pay back taxes on property under private ownership,” he said. City back taxes on the Episcopal Church Home property currently amount to more than a half million dollars.

“The deal fell through,” Episcopal Church Home attorney Paul Taylor said in court, apparently referring to both deals—the sale to the state and the PBA deal on the back taxes.

And why did the sale to the state fall through? The deal is now being taken over by ESD. ESD attorney Stephen Gawlik said it was “the same plan.”

NYSDOT did not respond to a request for elucidation on why it reneged on its agreement. An ESD spokesman explained the switch to ESD in terms of the project’s being more in accord with the ESD core mission of stemming urban decay than with NYSDOT priorities.

Could it also have something to do with money? Or politics? One partial explanation for the switch would be that ESD chairman Sam Hoyt is also chairman of the PBA, which should facilitate transactions.

Preservation activist Dana Saylor complained at the court hearing of a “lack of transparency” about the whole Episcopal Church Home matter. She suggested that other parties were interested in acquiring the Episcopal Church Home property, but were put off from pursuing acquisition by the state’s involvement in the matter.

Judge Carney interposed that “anybody’d have to be crazy” to pursue acquisition of the property, bidding against a state agency that has eminent domain rights. One of the reasons originally given for state involvement in the matter was that agencies such as NYSDOT and ESD have eminent domain power. The PBA does not have eminent domain power.

Community activist and former city councilman Al Coppola asked what the property was worth? What was the Episcopal Church Home’s asking price?

Taylor said he had “no idea.” Episcopal Church Home CEO Rob Wallace, who was not present at the court hearing, did not respond to a phone call request for information regarding asking price.

Minutes of the ESD meeting of February 21 (accessible on ESD’s website) note that two appraisals of the Episcopal Church Home property were performed, and the results were $1.86 million and $1.65 million.

So, “have to be crazy” bidding against an agency with eminent domain power, and paying more than twice the property value.

The minutes go on to justify the higher-than-appraised-value anticipated sale price (the minutes say “not to exceed” $4.7 million, a $700,000 hike from Cuomo’s announcement) by noting that “current liens against the property exceed $14 million,” including the back taxes, a HUD mortgage acquired at auction by the PBA, and various other encumbrances. The minutes aver that “These complex liens on the Property make it unmarketable…Absent ESD’s involvement, the Property will fall into further disrepair…”

Judge Carney seemed happy in general with the Episcopal Church Home’s efforts on maintenance of the property since the last court hearing, when he expressed unhappiness—in accord with complaints of area residents—about the perimeter fence in disrepair, unboarded broken windows, graffiti, etc. Some maintenance items have been performed, and some remain to be performed, in some cases, such as painting, depending on a turn in the weather. The judge expressed satisfaction that the Episcopal Church Home, per his directive at the last hearing, has been having a maintenance person check on the property every day.

“Nobody has seen him,” somebody said.

“Nobody has seen the graffiti artist, either,” the judge retorted.

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