BREAKING NEWS

BREAKING NEWS

Controversial city building buys stall

Secular Center is facing foreclosure proceedings

324-330 Central Ave., Dunkirk

324-330 Central Ave., Dunkirk

The announcement of a nonprofit buying up six parcels in the city of Dunkirk caused a stir back in June, but since July little news has come of its grand plans and documents show it may be in default on its mortgage.

In April, the United Secular American Center for the Disabled Inc. — a nonreligious, nonpolitical not-for-profit based out of New Jersey with a mission of helping individuals with disabilities, especially those who do not speak English — purchased 324-330, 332, 334-336, 338 and 609 Central Ave. and 605 Lark St.

Rumors arose that the center planned to evict existing tenants of the buildings in Dunkirk’s business district and bring in Section 8 housing. In July, the center’s president, Sharif Rahman, met with city officials and the OBSERVER to dispel the rumors. At that time Rahman listed ideas for services like social security disability and citizenship signups, education and training programs, drug and alcohol counseling and early intervention for children with special needs, depending on the community’s demand.

The center opened an office in the previous WIC location over the summer, but the most recent news indicates the center’s big plans were not fruitful.

Documents were recently shared with the OBSERVER of a complaint filed by the living trust of Robert K. Lesser, which lent the center $450,000 for the six properties.

338 Central Ave., Dunkirk

338 Central Ave., Dunkirk

The commercial foreclosure complaint filed on Nov. 28 summoned Rahman as the center’s representative to appear in Chautauqua County Supreme Court due to a default on the mortgage.

“At this point in time we’ve just filed the mortgage foreclosure complaint. Then the matter will take its course through the courts,” Richard J. Evans Jr., the attorney representing the living trust explained.

According to the complaint and accompanying exhibits the center signed the 10-year mortgage on April 12, which was filed in the Chautauqua County Clerk’s Office on April 29.

Those mortgage documents state the first payment of $3,095.49 was due June 1 with interest upon default at 2.85 percent and payments over 15 days late charged a 5 percent fee.

Default may occur for failure to make a payment, maintain insurance or pay taxes on the properties. In the case of default, the trust can call the full amount due and take possession of or sell the property in order to satisfy the debt. Any balance is the responsibility of the borrower unless discharged in bankruptcy.

609 Central Ave., Dunkirk

609 Central Ave., Dunkirk

According to a payment statement, the principal as of Nov. 15 was $447,929.29, plus $9,315 in interest and $928.62 in late charges, for a total $458,172.91 due as of that date. The center missed its payment in June, paid the principal payments in July and August, but had failed to do so in September, October or November as of Nov. 22 for a total of $13,310.58 past due.

Evans, a real estate attorney with Phillips Lytle LLP in Rochester, called the complaint a “standard commercial mortgage foreclosure action” and confirmed the reason is a lack of payment.

The complaint states the center has 60 days to respond, putting the deadline on Jan. 28. Failure to respond will result in judgment against the center by default for the relief demanded in the complaint.

As of Jan. 5, the complaint was unanswered by the center.

“I can say I have not been served with any papers that they have contested it,” Evans added.

The City of Dunkirk still leases space in the Stearns building for its Development Department. Dunkirk Mayor Willie Rosas said he did not have enough information to comment on the foreclosure, but has tried and failed to keep communication open with the owner.

“I haven’t been able to make contact with them. We’ve not received any notices, but we have sent checks that have not been cashed,” he explained.

Evans said he is not sure what his client, who previously owned the properties, plans to do, but it is premature to assume anything about the proceedings, which can be lengthy and have just begun.

“In a mortgage foreclosure the owner has the right to redeem or pay the mortgage up until the time of the foreclosure sale. Obviously, we are a long way off of any of that happening,” he said.

The city of Dunkirk Assessor’s Office confirmed the center also purchased the former Ehler’s building at 400 Central and the former School 10 at 201 Lake Shore Drive E. on July 21. However, those properties are not mentioned in the complaint.

Comments on this article may be sent to ngugino@observertoday.com

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