Based on the findings of a 2014 Inspector General’s report, the Lieutenant Governor’s Office is pressing the “reset button” on properties auctioned in 2012 and 2013 and giving owners back their land, but outstanding taxes owed still have to be paid by September 2016, Lt. Gov. Osbert Potter said during a press conference Wednesday on St. Thomas.
Potter made it clear that the properties will go right back to the auction block if owners don’t take the steps needed “to correct their situation.”
Approximately $2.3 million in refund checks are available for bidders that paid for the properties auctioned and residents can call in to see if they are printed and ready for pick up, Potter said. Bidders are also entitled to 4 percent interest on those payments, but that will not be immediately included because the government still has to find a funding source.
None of the money paid for the properties was put in an interest bearing account that could have covered the extra amounts, he added.
Answering questions at the end of the press conference, Potter said he’s not at liberty to say who in his office has been found responsible for the discrepancies in the 2014 Inspector General’s report, but explained that an investigation between his office and the Inspector General’s Office is ongoing and, once it is complete, those names will be released and possible criminal charges filed.
Specifically the 2014 Inspector General’s report found that most of the sales from auctions conducted by the Lieutenant Governor’s Office in 2012 and 2013 should be voided based on the finding of “highly irregular and questionable practices” and an alleged scheme to manipulate the bidding process that shut out legitimate bidders and transferred properties at undervalued prices.
“There is also a strong indication that one or more officials from the Lieutenant Governor’s Office either participated in the bid manipulation scheme or were aware of it happening and failed to prevent it from continuing,” according to the report.
During Wednesday’s press conference, Potter said the sales of 105 properties were officially voided in July and that, since then, his office has also conducted an investigation that turned up other “irregularities.”
“As a result of these auctions, the territory lost thousands of dollars because mismanagement of the auction process and the public trust, which is even a greater concern, the public trust in the process was tainted,” Potter said.
The Lieutenant Governor’s Office has continued to work with the Inspector General’s Office to understand the “rationale behind the findings,” Potter said, adding that most of what was reported comes down to proper notification and distribution of information to property owners.
Potter said, “We will be getting the auction process to a point where the public will have full confidence in what we are doing. The law allows us to auction properties for failure on the part of the owners to pay taxes, and we will be publishing and sharing with the public on a regular basis what the law says and how were are going to be proceeding.”
Making sure property owners are notified and given enough time to pay or work out a payment plan with the Lieutenant Governor’s Office will also be part of the process, Potter added.
Residents who think they should be receiving a refund check should call the Lieutenant Governor’s Office immediately, Potter said, adding he will also be publishing a list of owners that will be getting their properties back.
“We are specifically asking individuals who are now going to get back their property to take the opportunity to get right with the Office of the Lieutenant Governor and pay the taxes that forced these properties to be auctioned in the first place,” Potter said.
“We will be doing another auction, based on our assessment, by September 2016 and are giving all individuals the time from now until then to clean up their situations and get those items out of the way. If not, these properties will go right back on the auction block.”
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