City seeks parking lot ownership resolution

Questions and confusion about the ownership and responsibility of a local public parking lot have swirled since the lot was sold in a state land auction late last month due to delinquent property tax payments.

The city quickly reclaimed the property and community scuttlebutt about the matter has continued, with much of it directed at Mayor Veronica Smith-Creer and her administration.

As a result, Smith-Creer addressed the matter during an El Dorado City Council on May 12, allowing council members to also comment and ask questions.

City Attorney Henry Kinslow and Council Member Paul Choate capped off the exhaustive discussion by saying that the city could perform a title search to determine the rightful owner of the property, which was believed to be city-owned.

Unpacking points

Smith-Creer unpacked several points to clear up rumors surrounding the matter, including events that led up to the sale of the parking lot.

On April 27, Richard Mason, downtown developer and business/property owner, notified some city officials in an email that the east parking lot in the area of Cleveland, Elm and Oak streets behind First Baptist Church on Main Street had been sold in a state auction of properties for which real estate taxes were delinquent.

Smith-Creer was out of town when the email was sent.

"When I got the information, I was not in the position to call and check things out," said Smith-Creer, who was out of town April 27, the day of the auction.

The mayor then pointed to an issue that Choate raised last December when he expressed "embarrassment" at learning that the city owed nearly $30,000 in delinquent real estate taxes, plus a 10% penalty, for 2020 property assessments.

Choate broached the topic during a regular council meeting on Dec. 9 and Smith-Creer said the city paid the delinquent taxes and late fees the following day.

The parking lot was not included in the notices of delinquency, Smith-Creer said, adding that the property is not a part of the city's inventory.

For more than two decades, the Union Square Improvement District, of which Richard Mason was managing director, collected fees that were paid to park in the lot and used to improve and maintain the city's historic downtown.

The USID was established in 1971, via a city ordinance, to oversee improvements and maintenance, including landscaping, planters and hanging baskets, for Union Square.

In 2013, the El Dorado City Council repealed the city ordinance that created the USID, effectively abolishing the organization.

Former Mayor Frank Hash explained then that state legislative auditors had learned that the parking lot belonged to the city.

For accounting purposes, auditors recommended that the revenue collected from parking fees be directed to city coffers, rather than the USID, the former mayor said.

Hash said the parking fees would flow through a revenue line item in the city's budget and would still be used for downtown maintenance and improvements.

Downtown enforcement

Shortly after Smith-Creer was sworn into office in January of 2019, the former downtown parking enforcement officer was terminated by her immediate supervisor, Robert Edmonds, director of public works.

The position has not been filled.

The move led to the creation of a task force, who held a series of meetings in 2019 and 2020 that included the mayor, Edmonds, the El Dorado Police Department, downtown property and business owners and other groups with a vested interest in downtown, including Main Street El Dorado.

Task force members expressed concern about issues that had arisen due to the lack of enforcement for the downtown parking ordinance.

Some of the complaints included downtown employees taking prime parking spaces from visitors/customers and vehicles illegally parking and blocking alleyways.

The city ordinance limits parking within a controlled zone to three hours between 9 a.m. and 5 p.m., Monday -- Friday, with the exception of legal holidays.

The task force bandied about ideas to tackle the issue and after several meetings -- one in which Mason was asked to leave under the threat of arrest for disorderly conduct --, Mason, who had continued to manage the paid parking lot after the USID was abolished and the parking fees went directly to the city, relinquished responsibility for regulating parking in the lot so that the lot could be available for free parking.

He followed up the announcement with a formal letter in several months later in September of 2020.

Ownership

Prior to the public land auction on April 27, real estate taxes for the lot had been in arrears since 2017.

Mason said the annual tax bills had been sent to his office at 200 N. Washington Ave. and he had taken the statements to City Hall for payment.

The annual payments stopped after 2016.

Union County Tax Collector Karen Scott provided to the News-Times documentation showing that the 2021 statement of taxes due was mailed to the Union Square Improvement District, in care of Mason, at the North Washington address.

As with all of the other invoices through the years, Mason said he forwarded the 2021 statement to the city.

"They were coming to us but we sent them to the city (P.O. Box 2170). We just forwarded it on to their P.O. box," Mason said, adding, "It started coming to us and we sent it on to the city and the county updated the address and started sending them to the city."

Smith-Creer said she was not aware of any property tax statements specifically for the parking lot being sent to City Hall in her nearly three-and-a-half-year tenure as mayor.

The mayor recalled, however, correspondence bearing Mason's name being mailed to City Hall once and she hand-delivered the piece of mail to the Department of Public Works. Smith-Creer said she did not know what of correspondence was included in the mail.

"So, the question is where were the bills being sent, who was paying the bills and why haven't they been paid since (2016)?" Smith-Creer asked.

The mayor said she spoke with the Union County tax assessor and collector's offices and has been unable to track down who paid the taxes after the USID was abolished in 2013.

In July of 2021, the Arkansas Commissioner of State Lands sent a certified letter to City Hall stating that real estate taxes for the parking lot were delinquent and that the property would be up for sale during a public auction on April 27, 2022, if the taxes and penalties were not paid by then.

The letter was addressed to the Union Square Improvement District, care of the City of El Dorado, and listed the city's P.O. Box 2170.

City Hall employee Paulette Gusby signed for the letter -- a fact to which Smith-Creer attested during the May 12 city council meeting.

"From the understanding I had, how could (Mason) gift it to the city if it was supposed to belong to the city?" Smith-Creer asked.

Upon speaking further to the ACSL's office, Smith-Creer said she learned the parking lot was issued to the USID in 1983 and the organization is listed as the "grantee" in state records.

In speaking with the county tax assessor's office, Smith-Creer said she also learned there is no apparent deed to the property on file with the county.

The applicable paperwork was not submitted to the county to transfer the property to the city when the USID was abolished or when Mason relinquished responsibility of the property in 2020 on behalf of the USID.

Mason echoed similar statements in a letter to city officials on April 29.

In the letter, he requested state records documenting the dissolution of the USID and showing that ownership of the parking lot was transferred from the USID to the city, along with a filing in the county tax assessor's office.

"Unless the (city) can produce the proper chain of title, I must, as (managing director) of the USID, assert the claim of ownership," wrote Mason, who attended the April 27 land auction.

Additionally, he wrote that he would reimburse the city any back taxes that have been paid on the lot and the USID would resume regulating parking in the lot once the documents are produced.

Reclaiming the property

The same day that Mason sent the letter, Edmonds traveled to the ACSL's office in Little Rock and paid the delinquent taxes and penalties on the property on behalf of the city.

The city had 10 days following the auction to file a petition to redeem the property and remit the total payment of $4,088.05.

"So, if the (USID) was dissolved in 2013 and the property was ... issued to (USID) in 1983, I don't understand and maybe somebody can help me, how it was city property or how I was being blamed for it being delinquent in the taxes," Smith-Creer said on May 12.

"I said all of that to say this, things have been a mess long before I got here but some of things have to get fixed," she added later. "Although it was a mess, we can fix it, hopefully."

Council Member Dianne Hammond asked Smith-Creer if Gusby forwarded the certified letter to the mayor's office after signing for it last July.

"Were you aware of it? Did she take it to the (USID) and question them on that ... and try to get some details on it?," Hammond pressed.

"That was last year and I do not know," Smith-Creer said.

Kinslow said the city could ask the title company to review the situation and talk to the county tax assessor.

Council Member Avo Vartenian asked if a deed could be generated on the property and where the city stands in the matter.

Choate said a title search is the starting point to resolve the issue.

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