Bidders snatched up 53 properties at Luzerne County’s main annual first-stage delinquent tax auction last week, paying a combined $390,297, according to a tally from county tax-claim operator Northeast Revenue Service LLC.
Buyers in this auction — officially called an upset sale — had to accept responsibility for any outstanding mortgages and liens and pay all real estate taxes owed.
The highest purchase price was $25,000 for a 2,276-square-foot house on 0.49 acre at 9 Mystic Drive in Wright Township.
Robert J. Derwin, of Venkay LLC, bought the property, which is assessed at $195,500, Northeast Revenue said.
Ashrakat Shehadeh paid the second-highest price at the auction — $23,873 — for both halves of a duplex at 443-445 Rutter Ave. in Kingston, the tax-claim operator said.
That property is assessed at $222,700.
Shehadeh, of Kingston, had purchased three Wilkes-Barre properties in a smaller special county tax auction in April, saying she wanted to be part of efforts to revitalize vacant downtown buildings. In that sale, she acquired an 18,971-square-foot brick commercial and residential structure at 139 S. Washington St. and two sides of a double-block at 486-488 S. Franklin St.
Northeast Revenue started holding special sales in addition to annual auctions to more quickly address delinquencies.
Properties must be auctioned when taxes are at least two years past due unless the owners obtain removal through a court order, enter into a repayment plan or file for bankruptcy to get out of the sale.
The owners also can pay the portion of taxes dating back two years and prior — in this sale up until the year 2015 — to escape the auction.
Not sold
Of the 661 properties initially listed in last week’s sale, 72 were removed, said Sean Shamany, of Northeast Revenue.
For example, a judge agreed to postpone sale of the four-story Sterling Annex building on River Street in Wilkes-Barre until a special October auction because the owner — G2A-B Realty LLC — filed an assessment challenge contesting its 2012 tax bill.
A county assessment appeals board had reduced the property’s assessment from $1.622 million to $250,000 in 2013, but G2A-B maintained the reduction should be retroactive to 2012, when it purchased the property from the Greater Wilkes-Barre Development Corp.
A judge had removed the property from the 2015 tax sale because the company requested time to resolve the 2012 assessment dispute, but the court docket showed no filings pursuing that challenge before the property was again listed for sale this year. However, G2A-B filed a court action Sept. 26 against the county assessment appeals board.
A total of $96,574 in taxes are owed from 2012 through 2016 on the annex, which was once linked to the adjacent landmark Hotel Sterling that was condemned and demolished in 2013. City officials are trying to sell the 2.07-acre hotel lot at the corner of River and Market streets to a developer.
Also removed from the sale was “The Sanctuary,” a failed 27-acre development owned by W-Cat Inc. on Church Road in Wright Township.
The property owner paid 2015 taxes but still owes $24,616 for 2016, tax-claim records show.
A 43,000-square-foot former factory at 447 New Grove St. in Wilkes-Barre was continued to the October auction by a judge because the owner, Future Horizons PA Ltd., filed a court action contesting the assessment Sept. 26.
The company had purchased the property for $500 in 2013 from the county repository, a pool of land and structures that did not sell at past tax auctions.
The property owner pointed to a law that says the purchase price of a repository site “shall be deemed to be the fair market value of the property for tax assessment purposes.” That reduced value can’t change until the property is sold, improved or revalued as part of a new countywide reassessment, it says.
The assessment appeals board had issued a ruling in April 2013 keeping the assessment at $673,100. The board reduced the value to $225,000 in September 2014 but declined a further reduction Aug. 7, records show.
A county judge also postponed auctioning of the former Flaming Star Tattoos shop at 86 S. Main St. in Wilkes-Barre until October because the owners, which include Jack Covert, argued a private sale is pending, Northeast Revenue said.
That property carries $41,194 in delinquent taxes dating to 2010, records show. Covert had lost the property at a tax sale in 2013 but successfully reversed the sale in a subsequent Commonwealth Court challenge, which restored both his ownership and the back taxes.
The 536 properties that did not sell in last week’s auction will advance to a free-and-clear sale, when all liens and delinquent taxes are forgiven unless bidding competition drives up the purchase price to cover some or all of this debt.
