NUMB:
991774
VERS:
Original
REF:
XXBY:
THE CHAIR
TITL:
Resolution authorizing cancellation of outstanding City and County real estate taxes due on a property that was acquired by the USA through criminal forfeiture. (City Attorney)
ANLS:
This resolution will permit the City of Milwaukee to cancel certain delinquent real estate taxes against a parcel forfeited to the USA through federal criminal forfeiture proceedings. The cancellation is required by a federal court decision.
BODY: Whereas, George Davis ("Davis") purchased 2645 North Teutonia Avenue,
Milwaukee (324-9819-113-3) (fka 324-9819-11-7) (the "Property") on 5/3/88. On 9/13/93, Davis was convicted in federal court (U.S. District Court-Eastern District of Wisconsin) of drug-related crimes. On 3/2/94, the federal court issued an Order and Judgment granting title to the Property to the USA pursuant to federal criminal forfeiture law; and
Whereas, On 3/27/96, the USA sold the Property to St. Martin de Porres Roman Catholic Church, and, after expenses associated with the sale, the USA realized net proceeds of $4,953.69; and
Whereas, The City Attorney's Office on behalf of the City and its treasurer, based on a number of different legal theories, but primarily based on the fact that the USA never gave the City adequate notice of its forfeiture action, asserted that, when the USA acquired title to the Property on 3/2/94, it took title subject to back taxes for tax years 1992-1994; and
Whereas, The dispute between the City and the USA was litigated in the federal district court before Judge Clevert; and
Whereas, On 11/29/99, Judge Clevert issued an "Order Granting USA's Motion for Adjudication of City of Milwaukee's Interest in Forfeited Property" in favor of the USA and against the City pursuant to which Judge Clevert ruled, among other things, that: (a) the City's lien for the unpaid taxes was a "secret" one; (b) since the City had a "secret" lien, the USA was not required to provide the City with direct notice of USA's forfeiture action against the Property; and (c) the City's interest in the Property was "foreclosed" on 3/2/94 - the date the USA got its Order and Judgment concerning its forfeiture action; and
Whereas, The City Attorney's Office appealed Judge Clevert's ruling to the 7th Circuit Court of Appeals; and
Whereas, The City's appeal prompted negotiations between the City and USA pursuant to which, notwithstanding Judge Clevert's decision to the contrary, and subject to Common Council approval, the USA agreed to pay to the City the net proceeds the USA received when it sold the parcel to the church (i.e. the $4,953.69), and the USA agreed that, in all future USA-forfeiture cases affecting parcels in the City with delinquencies, the USA will provide the City with direct written notice of the USA's forfeiture actions so as to allow the City to take appropriate steps to protect its known (not secret) statutory lien and to demand payment; and
Whereas, The $4,953.69 to be received from the USA will be insufficient to pay in full the amount of delinquent real estate taxes against the Property; and
Whereas, The balance, exclusive of interest and penalties, remaining for delinquent city and county real estate taxes against the Property is $6,836.82; now therefore, be it
Resolved, By the Common Council of the City of Milwaukee, that the proper City officers are authorized and directed: to issue a check in the above amount ($6,836.82) to Wayne F. Whittow, City Treasurer, for the cancellation of the outstanding tax balances; to deliver said check to the Delinquent Tax Collection Unit of the City Treasurer's Office for proper disbursement; and to charge that amount to the Remission of Taxes Fund, Special Purpose Account No. 635001-Fund 0001; Organization 1911; Program 5840; Subclass S-163; Budget Year 2000; and be it
Further Resolved, That no interest and penalties are to be charged.
ZDPT:
DFTR: gch:wt:28306
2/14/00