Foreclosure proceedings begin on Lam's Norwich properties

Norwich - City officials have started tax foreclosure proceedings on several of the 26 properties owned by prominent downtown developer Janny Lam, who said she is trying hard to sell some properties, recover from the poor economy and climb out of tax debt.

Lam owes more than $300,000 in back taxes on her properties listed under several business ownership names. Last week, attorney Aimee Wickless. on behalf of the city, filed three foreclosure actions on several properties, including the former Heritage Discovery Center that fronts on Main and Water streets. The building houses four tenants, including the Norwich Community Development Corp. office.

Mayor Peter Nystrom announced in August that the city would start foreclosure on Lam's properties as title searches were completed on the different parcels. Wickless said these are the first filings, and more are expected in the coming weeks.

Lam said this week the city is singling her out from among many property owners who have fallen behind on their bills during the recession. She said she has made some payments and will continue to try to work with city officials to prevent foreclosures.

Many of her properties are for sale, but she said publicity about the pending foreclosures already have hurt those efforts. She said one prospective buyer greatly reduced an already agreed purchase price after the mayor's announcement in August.

Lam disputes the filing against the former Heritage Discovery Center at 77-85 Main St. and 87-91 Main St. Tax records show that Lam owes a combined total of $16,264 on two buildings that comprise the center after she made a $10,000 payment in October.

Until last year, however, the center was listed as one building, and taxes were much lower, Lam said. Lam brought the deed from her purchase to Assessor Donna Ralston to point out the mistake.

Ralston confirmed the change Wednesday and said the properties will be combined again when she completes the new grand list of taxable properties in February. Ralston already has placed notations on the assessor records that the building addresses will be combined in the next tax bill.

But Ralston said the change probably won't affect the total tax bill - based on square footage and building usage. Lam would have to appeal to the Board of Assessment Appeals, which meets in March to hear tax challenges.

Other foreclosure action filed last week included three small vacant lots at 9 Washington St., 92 and 106 School St. and a two-family house at 9 Fountain St.

Tax Collector Kathy Daley said Lam has made no payments on those properties in the past three years. Lam, however, countered that she had made payments during that time on her overall tax bills, but didn't specify which on properties to apply the payments. Now, when she makes partial payments, she lists the specific address.

If Lam wants to stop foreclosure action on the properties already in the court system, she has to pay at least 50 percent of the back bills, including interest accrued, and agree to a payment plan, Daley said. Those agreements must be worked out with Wickless.

Lam said she hopes to do that, but with the current economy, the numbers just haven't added up. She has to pay utilities and insurance first to protect her tenants, but the low rent she must charge in depressed downtown Norwich barely covers those costs. Some of her business tenants have closed - including the Kong Foo vegetarian Asian restaurant in the former Discovery Center - owing back rent. Some of her residential tenants have lost their jobs and can't pay.

"For the 13 years I have been here, I have tried my best to take care of that and not fall behind on taxes," Lam said.

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