Tonawanda News

Local News

June 13, 2008

NORTH TONAWANDA: Low-income housing in foreclosure

The owner of two low-income housing projects in North Tonawanda have entered foreclosure proceedings.

Nor-Ton Courts, 33 Spruce St., and Scarfone Apartments are now being administered by a lawyer appointed while court proceedings move forward.

In charge of the city’s once public Housing Authority, owner Sheldrake Inc. and management firm Nortona Redevelopment Co. LLC, of Garden City, N.J., are undergoing a foreclosure proceeding initiated by J.P. Morgan Chase Bank and owe the city hundreds of thousands in unpaid payment in lieu of taxes money as well as outstanding water and sewer charges.

Attorney John Aversa of Niagara Falls was appointed by Niagara County Court Judge Richard Kloch April 27 in a proceeding specifically involving Chase Bank and Nortona.

“I can’t tell you the past and I can’t tell you the future. It is my understanding that (involving) Nortona and Sheldrake, a foreclosure was commenced and meanwhile I’m appointed to receive the rents and pay the bills,” he said.

Aversa has organized current managers of the property and others under a new arrangement involving Clover Management of Buffalo in the meantime.

According to a letter sent by interim North Tonawanda City Treasurer Denise Proefrock to members of Nortona April 1, the company owes $50,000 plus an added 4.1 percent in PILOT money for 2008, as well as last year’s payment, including annual penalties accruing at the rate of 10 percent per year.

The company in total owes $108,155 in PILOT payments, as well as water and sewer charges amounting to about $250,000.

The letter April 1 was sent regarding the parcel at 33 Spruce St.

“I don’t think Chase is in the real estate business,” Aversa said. “Whether (residents are) paying their rent to me or anyone else I really don’t see any reason for immediate concern.”

A letter from the mayor’s office to City Attorney Shawn Nickerson Friday asserts a city policy that PILOT agreements “shall terminate” if an entity allows default conditions to continue for two consecutive years.

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