Smurfit property headed to foreclosure; taxes promised after sheriff’s sale
Wakefield Kennedy will foreclose on the former Smurfit-Stone Container Corp. pulp and paper mill west of Missoula and ensure the winner of a sheriff’s auction pays $550,000 in delinquent taxes, Missoula County said Wednesday.
Commissioners agreed to the arrangement after lawyers in the County Attorney’s Office said it was the fastest way to resolve an ongoing dispute over the defunct property and collect years of unpaid taxes.
“This is the fastest way we can get the taxes paid on this property,” said deputy county attorney Anna Conley. “We don’t have to intervene. We don’t have to file litigation against an absent property owner, which is M2Green. If we intervened, it would cause further delays in the foreclosure.”
Missoula County approved a settlement agreement with Wakefield in November 2017. Under the agreement, the Washington lender was expected to foreclose on 14 of the 15 lots owned by M2Green last year, though that process was delayed.
Wakefield financed much of M2Green’s original purchase of the property in 2011 and still holds the mortgage. M2Green scrapped the site’s valuables and left, abandoning its pledge to redevelop the industrial property.
Conley said it’s also possible that Wakefield could emerge as the successful bidder from the sheriff’s sale. In that scenario, it would be required to pay the delinquent taxes.
“We had some discussion with Wakefield’s counsel regarding our intent to intervene in that foreclosure and seek an order from the judge in that,” Conley said.
“We wanted an order from the judge in the foreclosure proceeding saying whoever is the successful bidder of a sheriff’s sale after this foreclosure needs to pay taxes, including penalty, interest and principle, out of the sheriff’s sale proceeds.”
Wakefield has agreed to that arrangement, though there’s no timeline for when the sheriff’s sale will take place. The U.S. Environmental Protection Agency still has a lien on the property and is named as a defendant, as is another lien holder, and both may choose to engage with the plaintiff, Conley said.
The EPA is still conducting its remedial investigation on the site for contaminants.
“It’s frustrating that we still have to wait, but I don’t see any other options to getting the taxes paid faster,” said Conley. “The benefit here is that you get penalty and interest, as well as principle.”
The arrangement has the support of the Frenchtown School District and its superintendent, Randy Cline. The district sets its budget each year based on anticipated tax revenues, and as the taxes have gone unpaid on the large industrial property, it has left the district in a pinch.
“This always creates a shortfall, which we have to cover with reserves every year,” Cline said. “The sooner this comes to pass, the better.”
He added, “In the long term, we’d be looking for some kind of development out there, so something becomes of that parcel of property. I know the EPA and other lien holders are going to have a say in what goes on out there, but this is a good step forward.”