City struggles with defaulted buildings

New York /
Jun.June 14, 2010 12:00 PM

2089 Arthur Avenue (source: PropertyShark)

Hundreds of buildings seized by the city for unpaid taxes and turned over to low-income tenants and non-profit groups decades ago are now in default, leaving taxpayers on the hook for $100 million, according to city officials, the New York Post reported. “It’s just a huge ongoing problem,” said Mark Page, the city’s budget director, at a City Council hearing last week. Eager to get out of the landlord business, the city launched a program through its Housing Development Fund Corp. in the late 1970s that gave non-profit groups the chance to take over foreclosed properties and allowed tenants to buy their
apartments at giveaway prices, generally $250. One of those buildings is at 2089 Arthur Avenue, in the Bronx, which
owes $5.4 million, although residents claimed they did their part by
paying rent. Given a choice of paying taxes and sewer and water charges or maintaining their buildings, many tenants opted to stiff the city, according to the Post. Page says the city is in a bind because it doesn’t want the buildings back and hasn’t had much luck collecting from poor tenants with limited assets. [Post]

 

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