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In the summer of 1996, the city forcibly evicted squatters from five city-owned tenements on East 13th Street so they could be rehabilitated by a responsible affordable housing developer.

But barely six years after the dramatic predawn eviction, featuring hundreds of police officers in riot gear, ambulances, helicopters and an armored vehicle, the five buildings are right back where they were when the squatters first moved in: on the city’s list of tax-delinquent properties.

According to current records from the city’s Department of Finance, Lower East Side Coalition Housing Development, Inc. (LESCHD), the nonprofit that took over the buildings in 1996, is $1.03 million behind in taxes.

Last December, tenants of Dora Collazo Plaza on East 13th Street received notice from the city’s Department of Housing Preservation and Development (HPD) that their buildings had been placed in third-party transfer, HPD’s process for transferring ownership of selected tax-delinquent buildings to responsible landlords.

Like many rehabilitated residences, the buildings are eligible for special affordable housing tax breaks, called J-51s, that would exempt the developer from having to pay most property taxes. LESCHD comptroller Sam Cruz said his group applied for those abatements years ago, but that their application “was lost by the city Department of Finance.” The Department of Finance could not comment on this by press time.

But Cruz also admitted that LESCHD waited until just a few weeks ago to pay taxes it had owed since 1997 from the construction phase of the project. Now that that’s paid, he claimed he was told the J-51s should kick in soon.

HPD confirmed his story, explaining that the developer finally paid its first and second quarter 1997 taxes on January 16 of this year. The rest, said an HPD spokesperson, will be covered by the J-51s, “and the interest and penalties are to be dropped.” But HPD declined to say when the group actually applied for the exemptions.

Residents and community members are furious that the developer let the taxes mount up for four years, and let the tenants in for such a scare. “Nobody can justify this for me, from the point of view of the organization,” railed Lower East Side City Councilmember Margarita Lopez. “The only explanation for this is that they are not doing their job! If you file for the J-51–if you file for the tax abatements–you will get it! The only explanation is that they didn’t apply for it!”

Until the tax abatements come through, residents say they’re still afraid that the city could take the buildings away. “I’m worried that they want to put these apartments in a higher market rate, and people on Section 8 won’t be able to live here anymore,” said tenant Leticia Hernandez. “It’s not my fault that they’re backed up, so why should I have to pay for their mistake?”

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