The McKinley Mall has been on financial thin ice for the past several months with the loss of key anchor stores like other area malls.
Now Hamburg Town Supervisor James Shaw says a Pennsylvania based firm which had trouble holding the mortgage with debt has now turned over operations to a court appointed receiver.
With that change in financial status there is a formal request to lower its value for assessed taxes from $55 million down to $15 million.
The Frontier School District may have to cope with a significant hit from its largest taxpayer. Dr. Richard Hughes is the Frontier Superintendent who says, "We were provided with documentation asking them to change their assessment basically by an 87 percent decrease, for us that's about a $570,000 decrease in tax revenue."
Hughes also fears the district may have to refund $1 million or more if an assessment cut is approved. So they are challenging it. But they are also preparing for a worst case scenario and potential tax hike to cover the gap. Hughes says "With the assessment it's about 1.5 percent. It would be more of a drop in revenue and we have to figure out how to... can we eat it... do we lower some expenses."
Superintendent Hughes stresses that with the district budget vote right around the corner in May this could have an immediate impact on district taxpayers.
Of course Erie County and more directly the town of Hamburg would be affected down the road in 2020.
Superintendent James Shaw says the town may cushion the blow by selling off surplus town owned property or seeking incentives to renovate empty retail space like the Toys 'R' Us store on Milestrip for new retailers.
Perhaps a new developer will try to acquire the mall but Shaw says "you can't make this mall work just on retail anymore...we're gonna need to have mixed use there."
Supervisor Shaw hopes to meet with the court appointed receiver for the mall in the coming weeks.