June 15--GARY -- One of the city's own school board members is one of the many derelict property owners whose tax avoidance has helped push the district into closing six of its public schools.
The Lake County Treasurer is trying to collect more than $566,000 in delinquent taxes and penalties from real estate owned under the name of Marion R. Williams, who has represented the Gary School Corp.'s 4th district since 2008.
County records indicate Williams has declined for years to pay taxes on 96 parcels, many of them in Gary's down-on-its-luck Marshalltown neighborhood, with an assessed value of more than $1.2 million.
Williams acknowledges the tax debts, noting, however, some of the properties he owned were divided among his ex-wife and children following a divorce, although county records still reflect him as the owner.
The properties are among thousands of abandoned or dilapidated properties littering the city, dragging down its property tax to a disastrous 42 percent collection rate and contributing to the school district's $23.7 million budget deficit.
Williams said he has no intention of making good on these delinquent properties, seeing himself as a victim of the city's profoundly depressed real estate market.
"I wasn't making a profit from them. I'm not going to be paying taxes if there is no reward or profit in what I am doing. Part of it is about being a good businessman," he said Friday.
That outrages William Fair, a Gary resident. "As a taxpayers myself, I find that incredibly arrogant." Fair noted Williams voted against the school closings in spite of the district's declining enrollment and revenue.
"I realize his taxes wouldn't make a significant difference, but what kind of example its that?" Fair asked. Williams said, "I probably pay more taxes than most folks."
Gary schools Superintendent Cheryl Pruitt said she was unaware of Williams' business ventures or tax situation and would have no comment.
Investment gone awry
County Treasurer John Petalas said state law requires the Gary school district and his office to work together to garnish unpaid taxes from the salaries of its employees, but Gary has yet to do its part by sending an annual list of school employees so his office can check off those with delinquencies.
State records indicate Williams, as a school board member, received $9,414 from the school district last year and $11,534 in 2012. Indiana law calls for school board members to get $112 for every regular school board meeting they attend and up to $62 for attendance of committee meetings.
Williams said he began acquiring many of the properties in the mid 1980s at tax sales, some vacant lots for $25 to $99 apiece. "I thought Gary was on the rise, and I bought these properties as an investment," he said.
No such revival has taken place.
"The population in Gary has been reduced by 100,000 people, and the demand for units has declined. It became a losing proposition. There is not a sufficient number of renters. There are not a sufficient number of buyers, and there is a tremendous amount of vandalism."
Williams said, "Even if you put money into them and remodel the house, you can't get that money out. The banks are not financing property in Gary. People are not investing in Gary."
He said he put thousands of dollars of improvements into one house in Marshalltown only to have its assessed value jump to $140,000. "When the property is over-assessed, you can't get your money out of it," Williams said.
Edward Gholson, chief deputy assessor for Calumet Township, said, "We hear that a lot." He said his office has had many meetings with Williams over his assessments and that he is aware he can appeal to the county and the state if he remains dissatisfied.
Williams said blaming him is misguided, noting, "There are a total of 12,000 empty houses in Gary."
Lake County Treasurer John Petalas said many of Williams' delinquent properties are scheduled to go on auction at his annual tax sale later this summer in the hope of recouping taxes owed to the school district, but he said the prospects are not good.
"Often people like him buy land from tax sales on speculation that failed, and they just let them sit there," he said, adding many Gary properties like Williams' go through tax sales year after year without any buyer interest.
Williams said he wishes someone would buy the properties and take them off his hands.
(c)2014 The Times (Munster, Ind.)
Visit The Times (Munster, Ind.) at www.nwitimes.com
Distributed by MCT Information Services