McKeesport's landmark Peoples Building is in the news again. This time city administrators say the building's new owners are behind in their mortgage and the state is looking into some $30,000 in disputed transfer tax.

This latest development was discussed at last week's council meeting. The Peoples Building on Fifth Avenue houses mostly city administrative offices.

McKeesport Redevelopment Authority's sale of the city-owned building to Strong Partners of Reno, Nev., 18 months ago elicited howls of protest from some city officials who felt the building was undervalued. But others hailed the $600,000 sale as the precursor to sorely needed development downtown. And the money helped the financially strapped city.

The eight-story building was once occupied by a bank on the first floor and professional offices on the upper floors. The city for years has been the largest tenant of the building, another sticking point for those opposed to the sale, who feel the city could lease cheaper office space in the tenant-starved downtown. But, the Peoples sales agreement stipulated that McKeesport would continue to lease space in the building, at a rate of $112,000 annually for the next five years.

Eyebrows were raised when several months ago, Strong resold the building to Geneva Equities, of Bakersfield, CA., for $2 million -- a price that many believe is more than the building is worth. Now, Geneva apparently has defaulted on a $2.5 million bank loan that it secured to buy the building, said McKeesport city administrator Dennis Pittman.

At the time of the second sale, Strong officials told the state Department of Revenue that Geneva acted as its agent in the sale, so the city of McKeesport was not due its 1.5 percent transfer tax. That tax would have put $30,000 in the city's coffers. Mayor James Brewster said the matter is being investigated.

Also, over the past 18 months, neither Strong nor Geneva was paying a great deal of attention to the upkeep of the building. City workers complained about problems with the air conditioning and maintenance problems.

Another twist to the Peoples story came when, according to city Administrator Dennis Pittman, "the new owner of Geneva wanted to know if they could donate the building to an Indian tribe to start a casino."

"Now he's talking about developing the building for residential use," Pittman said.