Newest tax scofflaws

If the various elected and appointed officials of Revere could tear themselves away from dope slapping each other at wakes, and put aside, just for a moment, their quest for metal detectors on the Blue Line to keep out-of-town "yutes" from corrupting their fair city, maybe they could get around to doing something that really affects the quality of life of all their constituents.

But that would mean standing up to the banks, which requires significantly more effort than throwing haymakers at funeral homes or blaming kids from Boston for everything except what the seagulls pick out of the barrels along the beach.

The pols in Revere and just about every city and town in the Commonwealth should be lining up to help Gerry D'Ambrosio. D'Ambrosio is a fine lawyer who performs for cities and towns the thankless task of collecting overdue taxes from assorted deadbeats, crooks, and scalawags. Ask him what the biggest problem facing financially struggling cities and towns like Revere is and he'll tell you.

"Banks," D'Ambrosio said. "Banks that foreclose on properties, throw people out, and then won't pay the taxes."

This is a relatively new phenomenon, a byproduct of the mortgage meltdowns that have fueled the recession, and the seeming inability of government or anyone else to put real pressure on the banks that have received billions of taxpayer dollars to be good corporate citizens.

"We always had three categories of people who didn't pay taxes on properties," D'Ambrosio was saying. "Mom and pops, and municipalities bend over backward to help in these cases, because they don't want to throw them out on the street.

"The second group is slumlords - playing games, manipulating property without doing work on it, and selling it. They play a shell game. They own 10 properties, pay taxes on half, don't pay taxes on the other half. So when the city is about to foreclose, they'll pay on the half they weren't paying and stop paying on the half they were paying. They're just trying to flip properties.

"The third category is commercial enterprises.

"Over the last six months, we've developed a fourth category: banks. Banks foreclose on properties, throw the people out, leave the property empty, letting it become a blight, and at the same time the banks don't pay the taxes."

It's not just one or two banks doing this, he said, "and it's pretty much statewide."

This is new. He calls it "a real industry-wide trend."

Said D'Ambrosio: "It used to be, if a bank had a property, the taxes got paid, right away.

"But now, since the bailouts, it's all changed. So the taxpayer is bailing out the banks, the banks are throwing people out of their houses, and then the banks don't pay the taxes. Properties run down, neighborhoods run down. It's nuts."

Peter Brown, D'Ambrosio's law associate, says banks are suddenly ignoring court orders, unconcerned with the blight and decay that often result.

"In talking with them, they are blasé about the whole process and their obligations, and believe they have an unlimited right to deal with these issues on their timetable and in the manner that best suits them," Brown says.

Last week, D'Ambrosio's firm oversaw the auction of a house in Gloucester. A bank hadn't paid the taxes for months, but at the last second tried to step in and pay the taxes off.

Too late.

The house sold for $180,000, and the bank lost a $165,000 mortgage.

"None of this makes any sense, for the banks, or the cities and towns," D'Ambrosio said. "If you ask me what's really happening, I'd say these are decisions that are being made in boardrooms, not in neighborhoods.

"I don't know how this can be helping the bottom line in boardrooms, but I can see with my own eyes what it's doing to neighborhoods, and it's not good."


Boston Globe