Upstate NY County Looks To Wrestle Away Mineral Rights From Tax-Delinquent Property Owner Who Has Since Paid Arrearage

In Broome County, New York, the Binghamton Press & Sun-Bulletin reports:

• The story begins with Sarah Vroman, owner of about 25 acres in the Town of Sanford, fallen on hard times and unable to pay her taxes. After two years, her bill had reached $6,460. So, earlier this year, Broome County began foreclosure. Soon after, as the saying goes, the plot thickened.

• XTO Energy came to town. The Texas company seeking to tap promising natural gas reserves in Vroman's town offered property owners more than $2,400 per acre up front and 15 percent royalties on production for their mineral rights. Vroman suddenly held the prospect of a $60,000 payday, with the possibility of more in royalties.

• Knowing the deal would save her property, Vroman appealed to county officials. They told her it was too late to stop foreclosure, but they eventually worked out a deal allowing her to buy back the property ... minus the mineral rights.

• That decision has been characterized by several town leaders as a mean-spirited money grab. County officials defend it as the fiscally responsible thing to do in the interest of taxpayers and the greater public good.

• Meanwhile, legislators are reviewing policy dealing with the Vroman case and the issue in general as the value of mineral rights skyrocket with expectations of the Marcellus Shale becoming a world-class energy producer.

• The Vroman controversy comes in the context of a recommendation by Kevin Keough, the county's director of real property, to keep mineral rights on foreclosed property of more than 5 acres. "As we all know, the gas issue is on the front burner here in Broome County," said Keough, who sees seizing mineral rights on foreclosed property as a no-brainer.(1)

For more, see Landowner, Broome vie for mineral rights (Foreclosed property may bring $60K payday).

For story update (11-21-08), see Ad-hoc group will settle county mineral-rights dispute (Landowners, county vie for cash windfall).

See also:

• WBNG-TV Channel 12: Broome Legislature Talks Mineral Rights,
• WIVT / WBGH Channel 34: Controversy over mineral rights - specifically whether a property owner retains ownership of them when he is in the process of foreclosure.

(1) In a recent press release, New York Attorney General Andrew Cuomo Cautions Consumers About The Potential Pitfalls Of Oil & Gas Leases in an attempt to keep New Yorkers from being screwed over by oil & gas exploration companies. He may need to issue another press release warning against overzealous county officials as well. Go here for other posts on dealing with exploration comapnies over your mineral rights. MineralRightsAlpha