Lockport Union-Sun & Journal Online

Local News

January 30, 2013

City will pay back spurned bidder

(Continued)

Lockport Union-Sun & Journal — “We have rules and they seem to be working,” White said. “Over the years this is how we’ve been able to improve the caliber of people who attend the auction.”

Regarding tax delinquents, White added, every year in the days leading up to the city auction, treasury staff take late payments from “lots” of people who end up being registered bidders. This tells him the rule is “most definitely well known” by locals.

Regardless how clear the language is in the terms of sale, Ottaviano said that in talks with an attorney for one of the rejected 2012 bidders, issues of fairness were raised that he thinks the city might have a hard time defending in litigation.

The treasurer’s office says it is keeping down payments to recover losses due to canceled sales, but it doesn’t approximate what a canceled sale actually costs the city. It’s just keeping 20 percent of the bid price.

“It would be fair to hold back a portion (of deposit) to cover fixed costs that the city incurs, but is it fair to take $500 from one bidder and $2,500 from another?” Ottaviano said. “We’ve always had complaints (about forfeited auction purchases), for as long as I can remember, but this year we’ve had significantly more — and more aggressive — complaints.”

Specific to Ubiles’ complaint, an equity issue is in play, according to deputy corporation counsel Michael Norris.

Ubiles owed $400 in taxes and late fees, and although he paid the tab in full less than one week after the auction, the city could be seen as having turned a tidy profit from his mistake. Four hundred owed, $6,000 taken, might put a quizzical crinkle in a judge’s brow, the attorney suggested.

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