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Schenectady nonprofits to see removal of liens

By Lombardo David
Tuesday, October 22, 2013

Schenectady nonprofit groups with tax liens owned by a private company will likely avoid foreclosure after Gov. Andrew Cuomo approved a bill on Tuesday that retroactively applies tax-exempt status to the organizations.

Tax liens sold in Schenectady between 2004 and 2009 included some placed on formerly tax-exempt churches and other nonprofit groups, which hadn’t reapplied for tax-exempt status and ended up owing taxes that they didn’t pay. The city worked with the state Legislature to rectify the liens facing some organizations, but not all of the problems were fixed and at least 10 small churches and other groups still had the threat of foreclosure looming, according to the bill memorandum.

The fix approved by the state Legislature in June will back-date the tax-exempt status for the organizations that are facing liens, which would negate the liens. State Sen. Hugh Farley, R-Niskayuna, a sponsor of the proposal, said previously that American Tax Funding, the private company that bought the liens in question, would probably have its costs refunded by the city.

Following the governor’s decision to approve the bill, Farley said he hopes this will allow the affected churches and organizations to focus on serving their community. “We will be working with the city and the affected parties to ensure this is implemented to the benefit of all parties involved,” he said.

The Assembly’s lead sponsor was Phil Steck, D-Colonie, who said in a statement that it would be unthinkable if the impacted organizations had to close their doors because of foreclosure. He added, “Now, these religious organizations will be able to keep their tax-exempt status, and will be able to avoid foreclosure."

Unitarian Universalist Church of Schenectady Vice President John Revchovsky said in a statement, “This legislation is a great relief not only for the Unitarian Universalist Church of Schenectady, but to all the other non-profit organizations that were affected."

The new law takes effect immediately.

A full story on this issue will be in the Wednesday issue of the Daily Gazette

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