}

Tuesday, September 13, 2016

BUILDING ON LEASED LAND, AND YOU GET TO PAY FOR IT...AND PAY FOR IT...AND PAY FOR IT!: Mark Noss Sticking The Grand Traverse Academy With His Commercial Property Taxes On School's Math & Science Center Building...And Board Goes Along With This Bad Deal; Where's Tax Attorney Jan Geht When You Really Need Him?

According to the Michigan State Tax Commission, buildings on leased land that are used for commercial purposes are classified as commercial real property. The classification is not based on the classification of the land on which the building is located.

And, according to a proposed timeline detailed to Miss Fortune by the East Bay Township Assessing Department, in a perfect world Mark Noss should be getting the assessment ball rolling now.

But Noss has already covered his end, sticking the Grand Traverse Academy with the responsibility for paying the commercial real estate taxes on the building under construction, a building Noss owns and will rent back to the school. 

(Don't these people have a lawyer review their contracts and get the best deal for all those tax payer millions? Oh, wait, it's the same group that paid out thousands in legal representation fees so that Brad Habermehl could have a lawyer in court...while he testified on behalf of Steven Ingersoll in December 2015 during Ingersoll's ongoing sentencing hearing.)

During my conversation yesterday with an East Bay Township representative, where I described the Grand Traverse Academy's relationship with Mark Noss and MDN Development without identifying any party by name, I was told the new building would be considered commercial property.

Commercial real estate refers to buildings or land intended to generate a profit, either from capital gain or rental income.

In order to get the property on the East Bay Township tax roll and schedule the appropriate key milestones with the Assessing department, in a perfect world, Noss should initiate the process now as construction commences.

But the Academy board's given him a pass (wittingly or unwittingly), with Noss adding this weak conditional clause under Section Nine-Utilities and Taxes: “Lessor shall seek an exemption from Michigan property tax based on the educational purpose of the premises, unless already recognized by the relevant taxing authorities.”

Educational purpose? Other than building this expansion on the backs of teachers and staff members, what exactly is the educational purpose of MDN Development? Has Noss initiated the exemption process? If so, what's the result?

I'm wondering: will this issue be on the agenda for this Friday's Grand Traverse Academy board annual meeting?

But that's nearly impossible for anyone other than board members to know, as the board is apparently reluctant to post its meeting agendas online in advance.

The Traverse City charter school signed its most recent lease resolution with MDN Development on February 2, 2016.

And while the school's superintendent, Susan Dameron, asserted in an April 10, 2016 Record-Eagle article that “Traverse City State Bank has agreed to loan GTA the money necessary to purchase the facility once the school has been out of deficit for three years”, why the rush to build the expansion? And what bank makes a loan decision two or three years in advance?

The school emerged from its deficit at the end of the 2014-15 fiscal year ending June 30, 2015. 

However, according to its lease agreement with Mark Noss/MDN Development, there's only a one-time option to purchase the building on February 1, 2019 at an already agreed upon asking price of $3.9 million dollars. 





If the Grand Traverse Academy is unable to purchase the building from Noss in February 2019, and continues to lease the building through the end of its twenty-year contract, total lease payments could exceed $8.5 million dollars.

Shouldn't we know exactly how much Mark Noss is paying Comstock Construction for the building? And the identities of his investors?

10 comments:

  1. Can't believe the board can allow something like this. Noss must be taking financial cues from Ingersoll to get the most of taxpayer/other people's money.

    ReplyDelete
    Replies
    1. The onus is on the Grand Traverse Academy board, which bears the legal responsibility for this asinine decision.

      Delete
    2. Asinine is an understatement for the board's stupidity and irresponsibility... hope the 'stuff' hits the fan when Noss and others are investigated by the Feds.

      Delete
    3. I'm betting that after all this time, and millions of dollars gone out the back door with Steven Ingersoll and his cronies, there won't be a federal investigation.

      Delete
  2. Noss, Ingersoll and Lynch are in this together. Don't ever believe that Ingersoll doesn't have a stake or hand in all of this. The sad part is they are taking advantage of children, parents and ultimately taxpayers so they can live their expensive lifestyles. I truly wish the State of Michigan and whatever municipality governs all of this actually cared but they don't. They want all of you to be taken advantage of and they gleefully take all your money. And another thing because they have GTA over the barrel, GTA will never have the money to buy the building. It is just another swindle job and the board members are letting it happen. Shame shame shame on everyone that supports this!

    ReplyDelete
  3. Any sentencing date?

    ReplyDelete
    Replies
    1. Absolutely no idea; suggest you contact either the Bay City Times or the Traverse City Record-Eagle.

      Delete
  4. Have you checked with the court?

    ReplyDelete
  5. Who knows. Noss gathered a group of investors for this commercial building project for which you and I will pay the taxes. Could be that the very board who approved this arrangement are in on the deal as well, along with Ingersoll, Harger, and Habemehl. In the end, it will be the teachers and staff who pay the price when the school is in over its head financially and has to figure out how to keep the money flowing to the greedy management company and friends cause we know Noss is never going to take less money. There's a special place in hell for people like him.

    ReplyDelete