MARCH 7, 2007

LEGISLATURE APPROVES NEW TAX LIEN SALE PLAN TO INCREASE FUND BALANCE AND CASH FLOW, FOLLOW FOUR-YEAR PLAN

The Erie County Legislature overwhelmingly approved a plan to sell outstanding tax liens to Plymouth Park/XSPAND, which will provide the County with millions of dollars more than the previous tax sale certificate agreement, at its March 1 session.

The County is slated to receive net proceeds of just more than $40 million. The proceeds would cover the $15.6 million the current Erie County four-year financial plan assumes from the previous agreement from 2007-2010. This amounts to XSPAND buying the County's outstanding tax liens for 105 percent of their face value. The County would establish a contingency fund with the remaining $24.2 million to meet unexpected budget events in 2007; officials expect most of that amount to be used to restore the County's fund balance.

The agreement also included a clause that mandates the final closing document give Erie County the right "to buy back on its own behalf or on behalf of any municipality any unproductive tax lien certificates on abandoned or underutilized real property for the original cost plus reasonable interest and actual carrying charges." Another clause requires the County Executive, County Comptroller, Budget Director and Director of Real Property Tax Services to submit the final closing documents to the County Legislature for its review before the proposed completion target date of April 30, 2007.

"A lot of us Legislators supporting the plan wanted a second chance to look at the RFP (requests for proposals) documents," Legislator Robert B. Reynolds Jr. (D-Hamburg), chairman of the Finance and Management Committee, said. "These are two good amendments. We worked very hard in committee and with all of the involved parties on this agreement. There was a lot of hard work, time and effort put in by the committee and most of the Legislature."

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