Thursday, January 2, 2003

Property manager missed tax payments

Published in the Current

Joseph H. Gallant III of South Portland, who failed to pay collected rents to owners of Higgins Beach property he managed, has not paid state or federal income taxes since 1997, according to bankruptcy court documents.

The Maine Revenue Service and the Internal Revenue Service are disputing a plan Gallant filed in October to pay off his debts by selling some property he owns.

Those debts total less than $650,000, but more than $590,000, according to Gallant’s attorney, James Molleur of Saco.

The IRS and MRS are not sure what they are owed, because Gallant’s taxes haven’t been filed for 1998, 1999, 2000 or 2001, court documents say.

Molleur said Gallant owes “less than the tax authorities think they are owed” in back taxes.

Several other creditors, all owners of Higgins Beach property managed by Gallant, also have filed objections to the payment plan. The property owners are concerned because they do not know how much Gallant owes in taxes. The courts typically order back taxes to be paid off before business debts.

The tax agencies’ objections, Molleur said, are more serious because “they get to the heart of whether we can do what we say we will do.”

Gallant’s plan hinges on raising money from the sale of a lot he owns at 4 Morning Street Extension, right on Higgins Beach. The land was assessed in 2001 as being worth $265,300, with a building value of $43,900.

At an auction held Dec. 13, an offer of $587,000 was made for the property by Richard Raubeson of Cape Elizabeth, Molleur said. The sale is not final until approved by the bankruptcy judge.

If it is approved, the amount still won’t be enough to pay every creditor the entire amount owed, Molleur said. “We’ll be a little short, I think,” he said. He said Gallant is “exploring other ways” to raise the additional money.

“Our goal is still to pay everybody 100 percent,” Molleur said.