48 Kroemer LLC, a trio of businesses that had sought to move its operations to a site on Kroemer Avenue in Calverton, has now withdrawn that application following a Riverhead Industrial Development Agency ruling on the company’s request for tax abatements.
Tracy Stark-James, the IDA’s executive director, read a letter from 48 Kroemer at Wednesday’s meeting.
“We received correspondence from 48 Kroemer LLC, notifying the agency that it will be withdrawing its application, stating that the project will not move forward as proposed to the agency, in terms of size of the investment,” the letter said.
“Upon review of the proposed pilot they intend to scale back the project significantly,” Ms. Stark-James said.
48 Kroemer comprises three business all owned by Frank Fisher of Westhampton: 631 Propane, Go Green Sanitation and the Fisher Organization, a rental property management company.
The proposed project included the construction of 38,000-square-foot industrial building, a nearly 10,0000square-foot empty portable storage tank area and improvements to landscaping and lighting.
48 Kroemer has sought a property tax abatement and other tax incentives. Their application called for a total investment of $14.7 million. 48 Kroemer was seeking a real estate tax abatement of $30,000 per year for 10 years.
The IDA declined to approve those requests, and instead offered its standard abatement, which starts with a 50% reduction on the value of any new development and drops by 5% each year until the property returns to paying full taxes in year 11.
The incentive package the IDA offered represented an estimated $1.5 million over 10 years.
The total tax abatements sought by 48 Kroemer totaled $2.7 million, including abatements in mortgage recording tax and a property tax abatement of $1.8 million over 10 years on the increased value of the property, according to Ms. Stark-James.
Ray Dickhoff of Aquebogue, a representative of 48 Kroemer, had asked the IDA to reconsider the proposed property tax abatement being offered. He said it would be difficult to attract tenants to the site under the abatement being offered. The lesser abatement would also mean they would have to reduce the proposed size of the project, he said.
At Mr. Dickhoff’s request, the IDA put off a vote on the abatement to give 48 Kroemer more decide what its next steps.
Mr. Fisher could not immediately be reached for comment.