Compromise reached on tax break for Culinary school

Officials from Riverhead Town and the Riverhead School District reached a compromise with Suffolk County Community College over property tax abatements granted by the Suffolk County Industrial Development Agency to the culinary school building in downtown Riverhead.

In November, the town and school district urged the IDA not to grant an enhanced tax exemption to the owner of the Suffolk County Community College’s culinary school that would result in no property taxes being paid over a 10-year period.

At the time, they argued that the college and the building owner and developer, Ron Parr, failed to pay any of the money owed through a prior payment in lieu of taxes from the previous 10-year Suffolk County IDA abatement it was granted. The town and school did eventually receive a payment, which totaled $258,113, according to Town Attorney Bob Kozakiewicz.

The new abatement requires the college to pay 100 percent of the land value but only 25 percent of the value of the improvements to the property, such as the building.

However, the amount the town, school and library pay in property taxes each year is an unchanged flat rate for the 10 years of the abatement, and is not affected by assessed values, according to Tony Catapano, the executive director of the Suffolk IDA.

Thus, the total property tax they would pay each year through a payment in lieu of taxes agreement is $36,828, which breaks down to $24,410 to the school and library, $11,502 to the town, and $916 to the county general fund and special districts. The PILOT would be paid directly to the town, county and library in January of each year. Normally, all property taxes are paid to the town, which distributes them to other municipalities.

The college would continue to pay town special district taxes, such as sewer and water, at their annual tax rate, which changes each year.

For the current year, the tax bill that would be paid by the college without the abatement is $129,231.

The college’s director of community affairs, Ben Zwirn, said the town asked that the college to consider doing more evening and weekend programs at the culinary school, and that it get more involved in the community, which he said it has.

Mr. Kozakiewicz acknowledged the town’s making those requests, but said he wasn’t sure he could represent the Town Board’s stance on that issue. He asked that the discussion be continued on the issue. IDA members, however, said they were ready to vote and did so.

College officials had argued during the process that the college is nonprofit and is not required to pay property taxes. Mr. Parr has argued that they are required to do so under an agreement he signed with the college.

Mr. Zwirn said the college still has 10 years to go on its lease agreement with Mr. Parr, in which they are paying property taxes. He said when that lease expires, the college will likely move the culinary school elsewhere.

Editor’s Note: This post was updated with additional information from Tony Catapano, the executive director of the Suffolk IDA.

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Photo caption:  Town Attorney Bob Kozakiewicz and college’s director of community affairs Ben Zwirn at the IDA meeting on Thursday. (Tim Gannon photo)