Evanston has filed a tax lien against The Margarita Inn at 1566 Oak Ave. after an internal City audit revealed the hotel was in arrears of nearly $500,000 in back taxes, officials confirmed this week.
The City filed the lien with the Cook County Recorder of Deeds Jan 7, seeking to recover back hotel and parking taxes amounting to $477,972, according to the filing.
A copy of the notice also went to Michael Pure, longtime owner and innkeeper at the hotel.
Mr. Pure did not respond to a request for comment about the situation made through the hotel Jan. 15.
City officials discovered the unpaid taxes during an internal audit conducted around mid-summer, said Interim City Manager Erika Storlie, asked about the lien.
The unpaid taxes cover a period between 2017 to 2019, Corporation Counsel Michelle Masoncup said.
Ms. Storlie said that City officials attempted to work with representatives of The Margarita Inn, trying to find a way for the hotel to pay back the City.
When those efforts were unsuccessful, the City moved to secure its interest by filing a lien, she said.
A lien in such cases can serve as protection for the City should a creditor file for bankruptcy or foreclosure, securing its place should there is a distribution of assets.
Ms. Storlie said The Margarita Inn resumed making tax payments after the missing payments were discovered.
She said the City is continuing to work with the hotel hoping to find a solution.
Ms. Storlie said the hotel apparently stopped making the payments after its account was shifted from one City department to another.
The missing money came to light, she said, when the new department in charge was doing its audit, making sure the taxes were paid up.
The City has had several situations recently where payments of taxes or fees, normally a given, have become a question.
Last March the City pressed Evanston SPACE, the live music venue at 1245 Chicago Ave., on payment of amusement taxes, which the business had stopped paying around February of 2017, according to an email from Mayor Stephen Hagerty to the establishment, obtained through Freedom of Information by the RoundTable.
“As a business owner myself, I would be mortified if such a mistake occurred. I’d apologize profusely and look to rectify it immediately,” said Mr. Hagerty in the email about the situation which was eventually resolved.
More recently, at the Jan. 13 City Council Planning & Development Committee meeting, Alderman Thomas Suffredin, 6th Ward, requested an update on the status of the payment due to the City for the lease of the recycling center, 2222 Oakton St., from former tenant – Smylie Brothers Draft and Package.
The business ended up terminating its lease with the city on plans to expand space at the property, with total payments owed of roughly $48,000.
Ald. Suffredin expressed frustration in general that the City is not collecting taxes and payments owed in such situations.
“It’s nuts that we don’t collect this money that’s owed to us and then come to residents and say we need more money,” he said.
At the same P&D meeting, Alderman Ann Rainey, 8th Ward, asked about the status of payments from Cafe Coralie at 633 Howard St., which was in arrears $91,228, including back rent, the principal of a loan and unpaid interest to the City at the time of its closing.