10-29-07 Item 4I, Forgiving Unpaid Penalties for PIN 3430230026

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~ ~~HILLS MEMORANDUM DATE: October 22, 2007 Agenda Item 4.1. TO: Honorable Mayor and City Council Members FROM: Sue Iverson, Finance Director SUBJECT: Request from Little Brothers - Friends of the Elderly BACKGROUND In 2003, the City did a PMP project that resulted in an Assessment of $59,364.00 to Little Brothers - Friends of the Elderly for property they owned in the City of Arden Hills at 3200 Hamline Avenue N. In 2004, they received a tax statement from Ramsey County showing the assessment which was to run for 10 years at an interest rate of 5.5%. On May 15, 2004 they paid the first half tax statement amount of $5,936.40. On July 9, 2004, they paid $53,427.60 which was the remaining balance due after the 2004 payments. Due to a misunderstanding or misinterpretation between the organization and the county, the second half payment of$5,936.40 was never paid leaving a balance that continued to accrue interest and penalties. On August 2, 2007, Ramsey County sent them a letter stating that they had an outstanding balance of $7,920.38. This letter also stated that this property was subject to tax forfeit to the State of Minnesota in 2008. On August 16, 2007 staff received calls from Therese Cain of Little Brothers - Friends of the Elderly and Mary from Ramsey County Property Tax departments regarding this matter. After several phone calls and information gathering, all parties agree that there was a misunderstanding on the part of Little Brothers - Friends of the Elderly on the assessment process, payment dates, and actual amounts due. Little Brothers - Friends of the Elderly has made an additional payment of $5,474.50 on August 23, 2007 which would be the outstanding principal balance leaving $2,445.88 still due on the account ($766.43 penalty, $$1,667.45 interest, and $12.00 fees). This is calculated through August 31, 2007. We have received a letter from the organization dated August 27, 2007 asking the City Council to forgive or write-off the remaining balance of penalties, interest, and fees (see attached).