April 07, 2020

City gives bankrupt Rich’s a discount> Bangor finance committee OKs writeoff of $11,200 in personal property taxes

BANGOR — A store that ran lots of sales in its years at the Airport Mall got a discount on its property taxes Monday, but not out of generosity.

City Solicitor Erik Stumpfel recommended writing off about $11,200 in personal property taxes for Rich’s department store, telling councilors on the finance committee that the money the city had in hand was probably all it was going to get.

Rich’s closed in January 1996 after the chain filed for bankruptcy.

The committee agreed with Stumpfel, voting to approve his recommendation to reduce the taxes.

The taxes owed by Rich’s were for personal property — the equipment and fixtures that were in the store.

The store didn’t own the building it was in, so there were no real estate taxes. If there had been, Stumpfel said last week, the city would have held off and taken the real estate on a matured tax lien at the proper time.

Before the meeting, Stumpfel had sent the committee a five-page memo on the tax matter, which was quite technical.

In essence, Stumpfel explained to the committee Monday, the $11,200 represented the second half of the store’s taxes for fiscal year 1996. The city is getting the 1997 taxes owed it, he said.

The city could have refused to reduce the taxes for 1996, he said, but its chances of getting more than the $13,347 Rich’s offered was small.

The city would fall in a low category for repayment after the bankruptcy proceedings, he anticipated, and likely would not get any more money.

The amount offered by Rich’s will cover pro-rated taxes for 1997, in addition to outstanding sewer bills.

Also on Monday, the committee approved:

Spending $2,402 to install automatic door openers at the side entrance to City Hall. The work will make the building more accessible to the handicapped, particularly those in wheelchairs. Because it is a capital project, the matter will go to the full council for a final vote.

Spending $19,000 to stabilize the concrete floors at the Bangor Auditorium.

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