One year after the Peekskill Herald first reported that unpaid Peekskill property taxes totaled more than $2.3 million, another $780,00 has been added to the pile of uncollected money owed.
City officials haven’t gone to court yet against any of those delinquent property owners, revenue that could help with the city’s difficult financial condition and ease the burden on those who do pay their taxes.
The largest delinquent taxpayer added to the city’s In Rem list is 200 North Water St. Equities LLC, owing $252,186, according to the City of Peekskill Finance Department. The firm owns the 200 N. Water St. building that rents space to the Jan Peek Homeless Shelter. [Caring for the Hungry and Homeless of Peekskill (CHHOP) has a multi-million dollar proposal before the city to renovate the building.]
The second largest tax delinquent on the new list is New York Pizzeria at 824 Washington St., with back taxes of $133,101. The building hosts a restaurant at the corner of Washington Street and Homestead Avenue.
Other new properties added to the newest In Rem list include Joey Enterprises LLC, 323 N. Division St., $72,257; Shannik Zuhair, 3 Scofield Court, $55,278; and Siniscalchi Onofrio, 225 N. Division St., $47,867.
The largest delinquent taxpayers that appeared on the list first reported by the Herald in March 2024 include: 104 S. Division LLC at 104 S. Division St., $260,612; Central Hudson Realty Inc., 231 Washington St., $225,793; Clinton Fund B Trust, 730 N. Division St., $176,346; and Louis J. Varricchio II, 116 Lakeview Drive, $157,037.
The money owed includes the unpaid taxes and the penalties accrued up to Jan. 31, 2025. The list covers unpaid taxes from 2016 to 2021. City of Peekskill – In Rem List 2016 – 2021
A Long Legal Process the City Has Just Begun
Last year Peekskill officials indicated they hope to reach a point where legal action against delinquent property owners would start in February 2025. With turmoil in the city’s legal department following the departure of former Corporation Counsel Michael Hartman and the hiring of the law firm Keane & Beane to handle all legal matters, little progress has been made.
According to City Manager Matt Alexander, that process is starting now. In an email, Alexander told the Herald, “Currently, the city is working to identify any persons or entities who may have an interest in the properties that are long delinquent in the payment of their taxes.
“Once we have identified all those who have an interest in the properties (e.g., banks, relatives of deceased persons, etc.), we will be commencing a proceeding before the New York State Supreme Court, Westchester County,” Alexander said.
Collecting property taxes is a basic function of government. According to the City Manager’s 2024 budget plan, Peekskill does routinely pursue past-due property taxes. However, no auctions of tax debts have been held for six years. During the pandemic, New York State put a stop to foreclosure actions.
In the 2024 budget, Alexander wrote: “Tax Foreclosures: The City regularly pursues collection of unpaid taxes, through the in-rem foreclosure process by which the City can obtain title to tax-delinquent properties and auction them to new owners. Existing owners are always contacted and offered the option of paying off back taxes with an installment plan.
“Failing this remedy, the City has commenced an action to collect delinquent 2017 real estate taxes. This annual collection of past due taxes not only assures consistent cash flow, but also helps maintain the City’s positive financial profile with ratings agencies, resulting in lower interest rates on municipal debt.
“The Tentative Budget forecasts much less than the previously budgeted $600,000 in 2023 revenues from an in-rem auction. The last auction was in 2019. The Supreme Court ruling in Tyler v. Hennepin County, which disallows municipalities from taking title, selling property, and keeping the proceeds, will significantly reduce this anticipated revenue. However, the City will continue to pursue its unpaid receivables for past due taxes and collect increased fines and penalties.”
[The Supreme Court ruled in May 2023 that a government agency can only keep the taxes owed if it sells a property and must give any excess funds back to the property owner.]
Alexander told the Herald this week that proper notice of the past due taxes will be provided by certified mail, regular mail, and publication in the newspaper, as well as posting in various city and county offices. After that filing, interested parties will be provided a period of no less than six months to answer and appear prior to the City seeking an order from the Court.
“Thereafter, the City may seek to auction off some or all of the properties. Parties with an interest in the properties are encouraged to contact the City regarding potential options,” Alexander said.
Vital Revenue Not Collected by Peekskill
Recovering the $3 million owed in back taxes from delinquent property owners would help ease the budget pressure on city officials and could ease the burden of some higher new taxes on residents.
That money would cover the Fire Department’s $3 million payroll or nearly 40 percent of the Police Department payroll. The city projected adding $3.6 million in new debt in 2024, and the revenue could cut that amount. Or, the city could avoid taking $2.1 million from its fund balance to cover its revenue shortfall this year.
Given the time periods involved in trying to contact property owners and then filing legal papers to start the process of foreclosing on the tax liens, revenue won’t be collected for many months. Some property owners can be expected to pay their back taxes before their cases reach the stage of court-ordered auctions in White Plains.
According to the City of Peekskill website, “From time to time the City sells properties due to unpaid taxes. If you would like to receive a copy of the list when it becomes available, please complete the online in-rem sign-up form.
