The Hindu Temple, First Unitarian Society of Schenectady and Schenectady Civic Players are trying to resolve tens of thousands of dollars in back taxes they owe as a result of failing to file for tax-exempt status years ago.
The problem dates back to 2007, when then-city Assessor Patrick Mastro began enforcing the rule that requires nonprofits to file paperwork every year to reaffirm their tax-exempt status. Nonprofit groups that did not submit the forms had their properties placed on the tax roll.
Some nonprofit groups did not pay their tax bill, and their tax liens were sold to the American Tax Funding collection agency. The city is trying to correct all these problems.
However, the law only covers three years, so the city is looking at swapping the liens on the nonprofit organizations. The city has not sold all of its delinquent tax liens to ATF and still has several outstanding, according to Corporation Counsel L. John Van Norden.
“American Tax Funding is willing to accept a substitution of those liens and return those liens to the city,” Van Norden said.
However, ATF has raised a question about whether state law would allow this, according to Van Norden.
The Hindu Temple owes $61,000, including interest and fees. American Tax Funding has agreed to swap these liens for other liens worth $55,000.
The city does not have the ability to forgive the taxes, only the interest and fees, Van Norden said.
“The swap of liens still leaves taxes [owed]. It would make it the city’s obligation to foreclose, or not foreclose,” he said.
But the City Council has no desire to foreclose on these properties. “We don’t want these churches,” said Councilwoman Barbara Blanchard.
ATF has agreed to exchange the Civic Players back taxes for $30,000 in liens. The Unitarians owe $90,000 before fees and penalties and $130,000 total on its property on Wendell Avenue, which is assessed at $989,900.
The modern building with a concrete exterior white wall of interlocking circles was designed by Edward Durrell Stone, who also designed the University at Albany’s main campus in the early 1960s. The construction cost $600,000 at the time.
The council asked if the Unitarians would pay the $90,000, but a church official said the organization’s finances are very strapped.
The Unitarians will receive a partial reprieve if the governor signs legislation forgiving their back taxes.
The amount of taxes the Schenectady Civic Players owe was not immediately available. Their property at 12 Church St. is assessed at $500,800.
Representatives from the Schenectady Civic Players did not respond to multiple messages.
Neither the Rev. Priscilla Richter nor Board of Trustees President Holly Hawkes from the First Unitarian Society of Schenectady returned messages, either.
Hindu Temple Chairman Derek Singh said he is optimistic that what he termed a “paperwork screw-up” will be resolved and the temple will settle with the city for quite a bit less than what is owed.
Singh disputed Van Norden’s figure and believed the amount owed was less than $50,000.
There is another a bill pending in the Legislature that would grant the group retroactive tax exempt status.
“We will come to a very good rational resolution and I’m very confident about that,” Singh said. “No one wants to see that happen. The city has been very cooperative and ATF has been very cooperative.”
The issue could be resolved as soon as the council’s Monday meeting.
Another problem is that the Hindu Temple has a Cingular cellular antenna on its roof, for which it receives rent. If that is the case, current city Assessor Tina Dimitriadis said, the property becomes taxable.
All nonprofit groups filed the necessary paperwork in March to maintain their tax-exempt status.