The developer of a new 45,212-square-foot PODS (Personal On Demand Storage) facility next to the Riverhead Charter School on Route 25 in Calverton is asking Riverhead’s Industrial Development Agency for tax incentives worth $628,188.
While tax incentives are generally intended to help lure a company to town, in this case, the building is already under construction and the frame is going up. Applicant Gary Krupnick is seeking a partial abatement on real property tax, a sales tax exemption on materials used in the construction and an exemption from county mortgage recording tax — all of which are allowed under the IDA’s standard incentive package.
The partial property tax abatement would apply only to the value of the new construction, and affect only school, town and county taxes.
Tracy Stark-James, the IDA’s executive director, said the value of the real property tax abatement is $408,757 over 10 years, while the sales tax and mortgage tax exemptions are one-time savings of $187,181 and $32,250, respectively.
The real property abatement starts at a savings of about $70,000 in year one, and declines by 5 percent per year over the decade.
Ms. Stark-James said she was aware that construction on the PODS facility had already begun, as Mr. Krupnick had sent a letter asking to start the work before receiving IDA benefits due to the changing season.
The IDA board made no decision on his request following a public hearing Monday.
Mr. Krupnick told the IDA that his financier on the project, Bridgehampton National Bank, asked him to seek IDA financing to help reduce costs.
He said all the other PODS locations in the state have received IDA financing.
The 6.3 acres on which PODS is being built is being subdivided from the rest of the property, which includes a solar farm to the south and another 12 acres that the property owner plans to subdivide for industrial development.
“We anticipate as many as 150,000 to 200,000 more jobs when it’s fully developed,” Mr. Krupnick told the IDA.
IDA board member Lou Kalogeras asked Mr. Krupnick whether the project would proceed if the IDA did not grant the requested tax incentives.
“It will proceed, but it will be under a lot of pressure financially,” he said.
Mr. Krupnick said he could not speak for the bank as to whether it would fund the project without IDA tax incentives.
He said PODS had been asked to relocate from the Enterprise Park at Calverton by Riverhead Town officials so that aircraft manufacturer Luminati Aerospace could take that space.
Photo: PODS in Calverton. (Credit: Tim Gannon)