A meeting Monday brought together local officials and managers of North Tonawanda’s two low-income housing developments, now in foreclosure.

The groups met to discuss recent foreclosure action brought by JP Morgan Chase Bank against the owners of the properties, Sheldrake Inc., and to determine the city’s plan to recover roughly $377,677 owed in utilities and unpaid payments in lieu of taxes.

Norton Courts and Scarfone Apartments, located at 33 Spruce St., were sold in 2004 after public funds dried up, and now money owed on a construction loan taken out following the sale has landed the matter in Niagara County Court, where attorney John Aversa was put in charge of collecting rents.

Initial figures indicate Sheldrake owes about $250,000 in unpaid water bills, and about $108,155 under the PILOT, going back two years.

“I am, as we speak, drafting a motion to intervene in those foreclosure proceedings so that the city can collect the money it’s owed,” City Attorney Shawn Nickerson said.

He said the document will be finished late this week or early next week.

Part of the official PILOT policy states the arrangement “will terminate” if payments are allowed to remain delinquent for two consecutive years.

Sheldrake’s second payment, for 2008 PILOT money, was overdue as of May 2, said acting North Tonawanda City Treasurer Denise Proefrock, who attended Monday’s meeting.

“That’s something that’s going to have to be discussed,” Nickerson said.

He also confirmed there was more than $100,000 in back-payments attached to the sale of the once-public property in 2004, and that some money was received, but will be reviewed in detail to ensure payment in full as the city steps up its involvement.

Mayor Larry Soos said no exceptions will be made for Sheldrake.

He said it is a lucrative management opportunity and he doesn’t see reason for residents to be alarmed, regardless of the owner’s ability to negotiate with the city and Chase Bank. Chase Vice President and Chief Financial Officer Bill Deignan said previously that there won’t be any opportunities to secure an extension on loans taken out for improvements at the time of sale.

He cited a teetering financial picture and a change in bank leadership as two conditions leading to the flap.

“Hopefully the people who are in charge will step up to the plate, and if not, new people will take over,” Soos said.

“They’re in default of the agreement and the city’s position is that that agreement shall be terminated,” Nickerson said. “The reason that I’m going to court on this is so the city can put its hand out and say we’re owed money and as a municipality, we take precedence over other creditors.”

Deignan, in statements made June 19, said the company should be able to resolve the matter “within 30 to 45 days,” with the help of an equity partner and negotiations for a loan extension with Royal Bank of Scotland Citizen’s Bank.

“Right now, I feel pretty satisfied that the people who are in there won’t be evicted,” Soos said.

Contact reporter Neale Gulleyat 693-1000, ext. 114.