TRENTON – Wayne County Treasurer Eric Sabree explained why officials will receive $777,628 in back taxes from Crown Enterprises instead of the anticipated $1.4 million at the Jan. 22 City Council meeting.
“The city had the option to purchase the property or let someone else purchase the property through the process called ‘right of refusal,’” he said. “When the city was contemplating making that purchase, the amount that the city would save, generated in a report from our office, was $1.4 million.”
Sabree said once the city decided not to purchase the former McLouth Steel property, and a third party was in the picture, his office should have prepared another report stating what the city would receive, based on the auction proceeds, which would be the back taxes minus the interest and penalties that had accrued.
“We issued a check to the city for $777,628.61, and that figure is consistent with the formula that was being used every time we do an auction distribution,” Sabree said.
He said that auction distributions are usually disbursed in April or May, but his office decided to issue a check Nov. 15 for the city of Trenton and the Riverview Community School District.
“It is nobody’s fault but ours,” Sabree said. “Our office generated the numbers, and I would be upset as well. The check was the correct amount.”
Sabree said in addition to consulting their own attorney, they contracted with an outside attorney for a legal opinion, which they expected to have by week’s end, but he doesn’t believe that the numbers will change.
“The error was in the fact that we did not communicate to the city or anyone else the correct amount,” Sabree said. “We talked about $1.4 million, didn’t tell the city, or anyone, that was a gross amount, that we were going to take interest and penalties from that amount.
“So it is our error, I accept responsibility as your treasurer for what comes out of my office, and I just wanted to come and tell you from myself what happened. I would be upset if I were you as well.”
Councilman Steven Rzeppa said that while he appreciated Sabree coming to the council meeting, hearing that the city’s share of back taxes from the McLouth property would be much less than anticipated was not something that he wanted to hear.
He asked City Administrator Jim Wagner if he had an update on the closing process with the county on the former McLouth site.
Wagner said the closing date was supposed to be Feb. 28, but after a long conversation with Steven Kaiser, Assistant Regional Counsel at the U.S. Environmental Protection Agency last week, he is concerned that the closing date will not be met.
He said Kaiser indicated that great progress was being made, but with the federal government shutdown for the holidays, as well as the government shutdown last weekend, he doesn’t know how the closing date will be impacted.
“Although the money is great, I think the most important thing is the environment and where we are going, and where all of you support it to go,” Wagner said.
He said his conversation with on-scene U.S. EPA Coordinator Brian Kelly and Kaiser indicated to him that they are working to put together a plan, and Crown is acquiescing to many things.
“You will have made a monumental agreement with something that even people at the EPA could not conceive us even getting done,” Wagner said. “I think that what you are going to get done protecting the environment of the Detroit River, protecting the citizens, protecting the area, is going to be very, very, very significant in what my conversations are with the EPA.”
Wagner said it was nice to get the money, but having the environmental protections coming into place is working out better than he ever anticipated.
“This will be a monumental agreement,” Wagner said. “We are still working toward getting an end of Febraury, sometime in March, to get this deal done.”
(Sue Suchyta can be reached at [email protected])