City attorney Kirsten Powell said the owner of the land, Title Two Investment Corp., paid the city the $390,607.67 it owed in back property taxes Sept. 16.
With the payment, Title Two avoided foreclosure proceedings.
Of that amount, about $260,000 will go to the city, and the remainder will go to Santa Cruz County.
At its Sept. 15 meeting, the Scotts Valley City Council approved a resolution to proceed with foreclosure of the property if Title Two didn’t pay all the money it owed within a week.
It was not the first time the La Madrona Drive property faced foreclosure.
The city nearly began the foreclosure process in April 2009 before Title Two paid the $174,400 it had owed since April 2008. It also approached foreclosure in July 2009, when the company did not pay $310,100 it owed.
Target Corp., which backed out of plans to build on La Madrona Drive in October 2009, has applied to renovate the 100,000-square-foot space left by Gottschalks in the Capitola Mall.
The proposal will go before Capitola’s planning commission Oct. 7.