TAX NEWS - JUNE 2010

New York Tax: Former district attorney losing home to tax foreclosure

ITHACA -- Bill Sullivan, former Tompkins County district attorney and a lawyer in many high-profile cases, is losing his Ithaca home to tax foreclosure.

Sullivan's longtime friend and neighbor, attorney Ray Schlather, appeared at Common Council's Wednesday meeting to ask for leniency. Ultimately the council voted 8-2 to allow the foreclosure to stand. Aldermen Svante Myrick, D-4th, and J.R. Clairborne, D-2nd voted to let Sullivan pay the debt and reclaim his home.

Bill and Terry Sullivan purchased their property at 306/310 Taylor Place in 1969 and raised their six children there, according to information provided by the Sullivans.

Bill Sullivan's long legal career included service as Tompkins County's district attorney and as an attorney for Shirley Kinge, who was framed by a State Police investigator during the investigation of murders committed by her son.

City Chamberlain Debra Parsons said this is not the first time Sullivan's property has been delinquent on taxes, nor the first time it's been so delinquent that he's received a notice of foreclosure.

In 2005, Sullivan was also fined for failure to pay federal income taxes for five years, Alderman Dan Cogan, D-5th, said. The fine led to his disbarment.

Schlather said Sullivan has given "hundreds of thousands of dollars" worth of pro bono legal work, some to Tompkins County, simply because he never filed for reimbursement of his time.

This shows "the absolute contrast between his commitment to minutiae and almost obsessive commitment to minutiae and detail in the service of others, and yet the total absence of the same when it comes to his private life," Schlather said.

A series of medical problems has exhausted the couple's finances and they now live on their Social Security checks, he said. Even so, the Sullivans have raised the $22,749.69 needed to pay all their back city taxes, as well as penalties, fees, interest and other administrative charges, and they could reclaim their $240,000 property while leaving the city "totally, totally whole," Schlather said.

"I'm very disappointed," Schlather said of the council's vote. "I understand the rule of law, I understand the need for consistency, but I also understand that there are times when doing the right thing requires something larger than that."

Sullivan did not attend the meeting and offered no further comment.

Alderwoman Maria Coles, D-1st, objected to even discussing the issue.

"The easiest thing for me to do is to say, 'This is a sad case, as are all the other cases, and yes, we should just give in.' Giving in will mean that Common Council will then be deciding on every case that will come to this point where the property might be foreclosed, and I give you my honest judgment that we will not be making those decisions the best way because we are political people. It just so happens that the Sullivans are my neighbors. This is a very difficult thing for me to do," she said.

It's been several years since the city actually auctioned a foreclosed house, but when it does, the proceeds are split between all the taxing agencies with outstanding debts, Parsons said. In all but one case she remembers, the city has received at least as much as it's owed in taxes by auctioning the home, she said.

Alderman Joel Zumoff, D-3rd, said he didn't see what justified making an exception for the Sullivans.

"This wasn't an all-of-a-sudden, yesterday-you-found-out-about-this problem. From what I understand he got a ton of warnings," he said.

Alderman Dan Cogan, D-5th, said he thought allowing the Sullivans to reclaim the home would "set a bad precedent."

"There comes a point, and it's sad and there may be extenuating circumstances, but it's not Common Council's role to deal with all extenuating circumstances people in our community face," he said. "We have to treat everybody equally and fairly."

Alderman Svante Myrick, D-4th, said Sullivan's request was unorthodox, but "these are unorthodox times."

Some municipalities are implementing moratoriums on foreclosures because of the economic downturn and the negative effect that foreclosures have on individuals and communities, Myrick said.

"I think the greatest good in this case is that these property owners can pay their taxes and keep their home. That's the greatest good. And giving them that chance by waiting 10 days, I think is in the city's best interest," he said.

Alderman J.R. Clairborne, D-2nd, said he didn't think the Common Council should "add to the homeless rolls by our own action or inaction."

"This fundamentally stirs me. We're talking about an action that will put people out of their homes. To me, that's the time when you look at doing something inconsistent," he said. "The phrase that's going through my mind right now is, 'By the grace of God go I.'"

A council resolution passed in 2004 allows property owners with delinquent taxes to reclaim their properties up until the point where the court awards title of the property to the city, but not between that period and auction.