If you’ve followed the Riverhead Industrial Development Agency over the years, you may feel like it’s never voted down anything.
On behalf of the Riverhead Industrial Development Agency board of directors, this piece is written to correct statements recently published in the op/ed section of the News-Review. The agency believes it is important to disseminate accurate information about its operations.
• The agency has not induced any big box stores to open on Route 58.
• The agency, by law, is selective on what businesses it can and will induce.
• The executive director is not paid based on what tax abatements are granted.
• The agency is not supported by governmental subsidies.
If you are a patron of Riverhead Free Library or have been a patient at the newly remodeled and improved Peconic Bay Medical Center you have first-hand experience how a Riverhead IDA project can benefit our town. Yes, the expansion of the library and renovation and enlargement of Peconic Bay Medical Center were made possible through financing granted by the Riverhead IDA.
The more recent projects on Route 58 that are receiving real property tax abatements include a cancer care center, bringing innovative and state-of-the-art radiation therapy not currently available; the bowling and recreation center on Route 25, which was a blighted parcel for several years; and the first hotel to be built on Route 58.
These projects, respectively, received five-, seven- and 10-year abatements. Two older projects, an emergency veterinary clinic and a retinal care center, are fully on the tax rolls at the end of next year. Tanger Outlets has never received a real property tax abatement. Tanger received only a sales tax exemption for building materials and is now the highest taxpayer in Riverhead Town.
In keeping with the vision of the current administration, downtown has been the focus of the agency’s attention. Without agency assistance, the town would not have the Long Island Aquarium & Exhibition Center, Summerwind Square, the Dark Horse restaurant and apartments, the renovated Suffolk Theater, Ralph’s Italian Ices, Blue Duck Bakery and Papa John’s, as well as the soon-to-be-revitalized former Woolworth Building.
A world-class hotel, the Hyatt, and an exhibition center were a new project connected to the former Atlantis Marine World Aquarium, now known as the Long Island Aquarium and Exhibition Center. Surely, no Riverhead resident can question that the aquarium has been the catalyst for downtown’s revitalization, as well as the source for public infrastructure improvements to downtown that typically result from all IDA projects.
The “100 percent abatement” terminology leads the public to believe that businesses are not paying taxes to the town. On the contrary — and unlike with the Suffolk County IDA — standard Riverhead IDA projects continue to pay their current tax bill on the property, plus half of the increase in the taxes beginning the year after the company makes improvements to the property, which increases assessed value. The agency’s standard policy gradually increases taxes over a negotiated period of time. (The standard is 10 years.) Additionally, by law, businesses pay all the other ad valorem taxes on their tax bills, as set by Riverhead Town. There are instances, particularly in downtown, where the agency has used its authority to grant greater benefits to a project in an effort to ensure a project’s viability.
It doesn’t take statistics to prove that the inducements are working. Nevertheless, the public can be confident that the agency is held to strict reporting requirements by New York State.
Additionally, the agency provides other services to the community. The agency initiated and hosts the East End Employment Expo, Workforce Development Symposium and other free events and seminars open to the public. In October, the agency will tackle the highly charged subject of health care by coordinating a health care symposium with Peconic Bay Medical Center and the Riverhead Chamber of Commerce.
Riverhead residents should know that many factors go into the decision to induce a project and negotiate a Payment in Lieu of Taxes (PILOT) agreement. The current administration appointed a new board that, over the last two years, has worked diligently to negotiate shorter benefit periods while still remaining competitive. The board members each reside, work and pay taxes within the Town of Riverhead. All board members are volunteers who do not receive a stipend for their efforts. There is no personal gain for the board to grant tax abatements.
We trust this information has provided the public with some facts and clarified the inaccuracies currently being written about the agency. We work hard to uphold the integrity and character of the agency for Riverhead and do not wish the public to be misled.
If you have questions regarding Riverhead IDA projects, please contact us.
Mr. Cruso is the chairman of the board of directors for the Riverhead Industrial Development Agency. He is writing on behalf of the entire board.
Allied Building Products is caught in an industrial park tug-of-war.
The New Jersey-based company has filed an application seeking Riverhead Industrial Development Agency tax abatements to lease space in a 16,500-square-foot building proposed for Edwards Avenue in Calverton.
That building, which has yet to be built, is located in an industrial subdivision owned by 1998 Peconic LLC, a group headed by Paul Elliot of Miller Place and Jim Miller of Southold, who also built the gas station adjacent to the Riverhead Charter School and the industrial land. Mr. Miller also owns Miller Environmental, just south of the industrial subdivision.
David Doran, Allied’s regional manager for New York, told the Riverhead IDA last Monday that his company is also considering the Hampton Business District at Gabreski Airport in Westhampton as a possible location.
Mr. Doran said company officials plan to expand to the East End but haven’t decided between the Calverton and Westhampton sites.
“Right now, we just want to see what our options are,” he told the Riverhead IDA last Monday.
Mr. Doran said Allied needs 30,000 square feet and has an option to build a second phase at the Calverton site, whereas the Westhampton site offers 30,000 square feet in one building.
Allied is eligible for a property tax abatement on whatever improvements its makes to the Calverton property . Those abatements start at 50 percent for the first year and decrease by 5 percent annually over 10 years.
Mr. Doran said Allied has been offered tax abatements at the Westhampton site as well, although he did not indicate who was offering them.
He said they are farther along with the Calverton site. In Westhampton, they deal with an agent, whereas in Calverton, the deal directly with the property owner, he said.
Allied, a family-owned building supply company, was started in Jersey City in 1950 and now has more than 180 locations across the country with over 3,100 employees, according to its website.
The company would have six or seven employees at the Calverton site in year one and “ramp it up quickly after that,” Mr. Doran said. The company pays employees a “living wage” of more than $20 per hour, he said.
Richard Ehlers, the attorney for the Riverhead IDA, told Mr. Doran that the IDA cannot close the public hearing and take action on the application until Allied has a signed contract for the Calverton location.
“But we can’t go into a signed lease unless we know our true costs going into the project,” Mr. Doran responded.
The IDA opted to keep the hearing open until next month to let Mr. Doran get more information on what direction Allied plans to go.
21st Century Oncology is seeking tax exemptions from the Riverhead Industrial Development Agency for its proposal to convert the former P.C. Richard & Son site on Route 58 into a radiation cancer treatment facility.
The IDA has scheduled a public hearing on the proposal for 5 p.m. April 15 in Town Hall. Florida-based 21st Century Oncology, which develops and operates radiation therapy centers in 15 states, is seeking exemptions from sales tax on products associated with the renovation and from mortgage recording tax on the property. In addition, it seeks the property tax exemption on the value of the improvements that are “consistent with the uniform tax exemption policy” of the IDA.
That policy generally calls for a 10-year property tax exemption starting at 50 percent, with the amount of the exemption declining by 5 percent per year until the property is at full assessment.
The property tax exemption applies only to the value of what is built, so that it never goes lower than the value of what is there to begin with.
The building is now undergoing asbestos removal. The cost of the project is estimated at $8.17 million, according to the application.