LAKE PLACID — A high-end Lake Placid lodging property is asking for a large reduction in its 2008 assessment, causing concern for Lake Placid Central School District officials. Last year, the Whiteface Lodge, including the fractional-ownership condos which can each be re-sold 12 times, was assessed at $109.7 million. The luxury resort is asking for its assessment to be reduced by more than $100 million — to just $2 million.
In papers filed on Sept. 5, 2008 in Essex County Supreme Court, the Whiteface Lodge claims the assessments by the town are excessive, overvalued and unlawful. They claim the assessment is greater than the fair market value of the property.
In February 2007, T-Rex Capital, LLC bought the Whiteface Lodge for an unprecedented $62.2 million from Lake Placid developer Joe Barile and his company, Resort Holdings, LLC. It was one of the largest transfers in the history of Essex County and the Adirondack Park. In April 2008, T-Rex returned the property to its lenders, one of which was the now-defunct Lehman Brothers, citing a slow housing market. The present owners bought the property for $60.9 million.
According to school budget officer Leonard Sauers, the school currently budgets $16,000 per year for tax certioraris, which are tax refunds the school is ordered to pay retroactively when a property owner has their assessment reduced. But the real concern for school officials is the amount of tax revenue it would stand to lose from one of the biggest tax payers in the district. According to district Budget Officer Leonard Sauers, last year a bill for $658,000 in school taxes went to the Whiteface Lodge. District Superintendent James Donnelly said a reduction in the property’s assessment would be “problematic.”
“A reduction would be huge and certainly we are not looking forward to it,” he said. “If you compound that on top of our state aid cut, absolutely, we are concerned with the financial landscape.”
According to North Elba town Supervisor Roby Politi, the Whiteface Lodge first challenged their assessment in 2005 and have challenged it every year since then. The petition has yet to be heard by a judge and the process could take years to reach a resolution, Politi said.
“These kinds of things always cost towns and villages a substantial amount because you have to go through an appraisal process that could cost as much as $20,000 or more,” Politi said.
Although Politi said he is not worried about the situation, he has been proactive about it, meeting with school district officials, as well as lawyers for the town.
Town of North Elba Assessor Kimball Daby said it is not unusual for property owners to challenge their assessments and a handful of people do it every year.
“We have 9,000 parcels and we got 10 article 7s,” he said. “That tells you we don’t have a big problem. It’s nothing that concerns us. People have the right to do it.”
The town of North Elba does reassessments on a yearly basis. Some other local towns, like Harrietstown, reassess every three years.
According to Catherine Gregory, town budget officer, the town of North Elba budgeted $25,000 to cover the cost of unexpected legal fees or claims associated with assessments for 2008 and the same amount for 2009. Gregory said the town paid out a total of $13,150 for article 7 lawsuits in 2008.
Officials from the Whiteface Lodge did not return phone calls as of press time.
