The owner of Southgate Plaza in West Seneca will pay about $75,000 less in taxes under a settlement that ends a six-year-old challenge to the worth of the property.
Southgate Associates agreed to drop its challenge to the assessment dating to 2014, and the Town of West Seneca, West Seneca Central School District and Erie County will not have to refund tax payments from those years.
“We set the assessment for several years into the future to provide some stability both to the property owner, taxpayer and to the town,” Peter A. Weinmann, the attorney for Southgate Associates, said.
The agreement also sets the assessment at $6.66 million for the next four years at the property at 3977 Seneca St. That’s a reduction of $940,000 from the previous $7.6 million assessment.
Because West Seneca assesses property at 37% of its full market value, the settlement sets the value of the property at $18 million.
“I think it was a fair compromise. We did come in a little higher than our appraisal but the town came down substantially,” said Weinmann. “There was a lot of risk and a lot of uncertainty had we proceeded to trial, and that was for both sides.”
The assessment case had some unexpected turns, starting with the town reassessing the plaza after the demolition of space to make room for the construction of LA Fitness. State Supreme Court Justice Henry J. Nowak ruled in favor of Southgate Associates’ challenge to the higher assessment, but that decision was overruled by Appellate Division, Fourth Judicial Department in 2018.
West Seneca Supervisor Gary Dickson said this year it came down to looking at the cost of continuing litigation and the uncertainty of whether the town would win the entire assessment case.
Based on the current equalization rate and the most recent budgets, the lowered assessment will cost the town about $20,000 in annual taxes, the school district about $42,000 and Erie County about $12,500, according to the municipalities.
“The town was better off by going with the agreement,” Dickson said. “It’s certainly always disappointing to lose tax revenue, however this is $20,000 that will have be made up by the other residents of the town. It’s not a budget breaker.”
Weinmann said the plaza also is dealing with a large vacancy due to the closure of Bon-Ton, a main anchor of the plaza.
“There is a huge vacancy that has an impact on the value and therefore the tax assessment,” Weinmann said.
The settlement was reached shortly before the two sides were scheduled to go to trial, Weinmann said.
Published by The Buffalo News