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Real Estate Tax Deadbeats
Last year the City of St. Louis sent out real estate tax bills totaling $216,229,879.81. As of April 3, $21,745,435.36 remained outstanding, on 18,835 accounts.
In a technical sense, delinquency can be no big deal. The city tacks on monthly interest of 1 percent (not to exceed 8.25 percent for 2007), plus a 2 percent penalty on total taxes and interest upon payment. After three years of delinquency, the city files suit against the property owner in St. Louis Circuit Court. If no settlement is made during the fourth year, the city sells the property at auction from the courthouse steps, as allowed by state law.
City officials say the generous time frame has made for an interesting "tradition," dating back as far as the 1930s or '40s, in which some property owners will consistently maintain two years of delinquency. Come year three, they pay the earliest year of back taxes in order to avoid a lawsuit.
Daly is taking strides toward getting even tougher with the deadbeats. Since his tenure began a year ago, he has established a new compliance unit, headed by two retired police officers who literally pound the pavement in search of the worst offenders.
"I think it makes a big impression when somebody knocks on your door and says, 'You didn't pay this,'" he says. "The community talks amongst itself. You hear one guy say that the collector was out here the other day about taxes, and you have another guy who says, 'Christ, I better pay this,' or, 'I better look again at that letter I got a while back.'"View Ten of the Biggest Real Estate Tax Delinquents in St. Louis City.
The delinquency clock ticks faster in St. Louis County, where properties are put on the auction block after three years. "We have people that literally call us the day of the sale and say, 'Have you come to my property yet?'" says assistant collector Tim Lee. "And then they'll come running in with a check."
The county tacks on interest at the rate of 2 percent per month (not to exceed 18 percent for 2007), plus a penalty of 2 percent on total taxes and interest upon payment.
Lee's team isn't shy about reminding corporate taxpayers — many of whom must fork over millions of dollars a year — that they've missed the deadline. "If Daimler Chrysler, say, or Boeing, is delinquent, we contact them immediately, because it's a large amount of money and could have a really big impact on our customers," Lee explains. But in a fit of discretion, he declines to specify who the calls went out to this January.
In 2007, St. Louis County issued real estate tax bills totaling $1,439,786,972.65.
On February 18, 2008, the first date for which a delinquency roll was available, local luminaries still in debt to the county included former St. Louis Blues player Doug Weight, $17,602.01 for 11215 Mosley Hill Drive; former St. Louis Ram Marshall Faulk, $8,293.04 for 6340 Clayton Road, and philanthropists Desmond and Mary Ann Lee, $9,355.18, for 9010 Sedgwick Place Drive. State Rep. Jim Avery Jr. also owed $1,430.38 for his Crestwood home at 9714 Big Bend Blvd.
As of April 1, the county was still waiting on $51,101,059.15 from 21,954 accounts.
By then Weight, Faulk and the Lees had paid up, as had Rep. Avery.
Click here to see more lists of real estate tax deadbeats.
Not All Deadbeats Are Created Equal
As we've noted, for the purposes of this story if the city and/or county didn't have your accounts marked as current at the time they produced the spreadsheets we requested, you're a deadbeat.
All the same, St. Louis area tax collectors are quick to point out there are myriad reasons people fail to pay. One, of course, is willful neglect. But as city collector Gregory F.X. Daly cautions, "For as many taxpayers who're trying to dodge it, there are just as many for whom it slipped their mind, or they thought their wife was doing it."
Other causes include: rough times, estate complications and miscommunications with mortgage or leasing companies, some of which can result in unwitting deliquency.
Stephen C. Murphy, a real estate lawyer who owns a considerable amount of property in the city and the county, is one of the larger debtors in both jurisdictions, with a tardy tab in excess of $480,000. It's a matter, he says, of priorities. "In a couple cases the properties are being refinanced. In some other cases we had big capital expenditures that we took care of first, and now we're doing the taxes," Murphy says, noting that the parcels amount to a small percentage of his total portfolio.
"We try to owe more than that," quips Pete Rothschild when told that the city has him down for more than $87,000. "Sometimes it's a cheap loan, depending on what the interest rates are."
Kidding aside, Rothschild says our call was the first he heard of any delinquencies. After a bit of research he called back with explanations: miscommunications with an escrowing company; oversights on bills for vacant lots; willful neglect in anticipation of pending sales. And, curiously, the city still has him down for four properties he says he sold last year — to the city. "But for most of these, the buck stops with me," Rothschild sums up. "There's no excuse except I'm an idiot."