Frazer seeks over $7.7M in taxes by Pittsburgh Mills real estate owners

Frazer officials are going after six Galleria at Pittsburgh Mills real estate owners for at least $7.7 million in delinquent special tax assessments.

On Tuesday, Supervisors William Creevey and Lori Ziencik voted to authorize filing a municipal claim and collection proceedings against the property owners. Supervisors Chairman Matthew Beacom was absent.

According to Ziencik, who also is township secretary/treasurer, the special assessments are part of the 2002 Tax Increment Financing plan in which the township received $50 million through the Alle­gheny County Redevelopment Authority.

The money was used to pay for infrastructure such as the Route 28 interchange to access the Mills as well as access roads within the 340-acre site, an on-site sewer system, lighting, traffic signals and improvements to adjacent roads such as Butler-Logan and Murray Hill.

Under the plan, the money is to be repaid using 75% of the county real estate tax revenue generated by the mall. When those revenues fall short, the special assessment comes into play.

“The special assessment is a mechanism to cover the deficit in the reduced amount of property taxes because of (real estate) assessment reductions,” Ziencik said.

She said it is designed to protect the bond holders, the people who actually put up the infrastructure money by purchasing bonds for the project, by ensuring their return on their investment.

“They (property owners) all knew this when they bought their properties, and it is for 20 years,” Ziencik said. “We didn’t choose to do this. This is in the TIF plan.”

She said it was the property owners who caused the special assessment to kick in by filing for real estate tax assessment reductions from the county.

“You have owners like Pitt Galleria who didn’t want to pay the real estate taxes, so they appealed the tax assessments and got those lowered,” Ziencik said. “And now, they don’t want to pay the special assessment.”

This is the first time this has happened, she said, adding that all 20 mall property owners are paid up on their regular real estate taxes.

The township has imposed the special assessments before.

“They were needed starting in 2016 after many of the properties obtained successful assessment appeals,” she said. All properties paid them until last year when the six on the current list did not pay, Ziencik added.

The special assessments are actually for two years, 2019 and 2020, but were billed in one for “a lot of different factors,” Ziencik said.

The special assessment delinquents and the amounts they owe (in rounded figures), according to the township:

• Pitt Galleria Realty LLC: $4.9 million

• VPM Associates LLC: $1 million

• Pittsburgh Mills Auto Properties LLP: $785,000

• May Department Stores Co.: $775,000

• Spirit Master Funding VII LLC: $123,000

• Pinpoint Frazer Associates I LLC: $97,000

Requests for comment were not immediately returned Thursday afternoon from the companies with delinquent special assessments. May Department Stores Co., which operates Macy’s and owns that store property, were not able to be reached.