PLATTSBURGH — The Plattsburgh City School District doesn’t benefit from Prime Plattsburgh LLC’s development of the Durkee Street lot.
In fact, City Board of Education member Roderick Sherman said, the school district would be hurt should that developer’s proposed Payment In Lieu of Taxes (PILOT) agreement be approved.
Upped property values and incomes would not generate revenue for the City School District like they would for the City of Plattsburgh, he said.
Those two factors, Sherman said, instead raise the district’s combined income and property wealth ratio per pupil.
“It’s a ratio used in the State Aid formula,” he explained. “That ratio gets increased per pupil (and) it lowers our state aid.
“We pay the price of a forgiven tax obligation for Prime, but get nothing in return. We need a larger share of the PILOT.”
The City of Plattsburgh signed a development agreement with Albany County-based developer Prime Plattsburgh LLC to build on the Durkee Street parking lot.
Prime submitted a request for a PILOT agreement, of which the County of Clinton Industrial Development Agency has overseen, and a public hearing was held Monday on the matter.
The proposed agreement would allow Prime to abate all property taxes for its initial four years and, after incremental increases, pay 34 percent of total property taxes over a 20-year span.
At the recent hearing, Prime Partner Todd Curley spoke on behalf of the developer’s proposed 114 market-rate apartments, 10,000 square feet of commercial space, 55,000 square feet of public-private parking and pedestrian walkway.
The PILOT application for the City of Plattsburgh project was in line with other Prime applications for similar Upstate New York developments, Curley said.
“We feel that these types of benefits are critical for this project to be successful,” he said. “The property consists of a parking lot that currently has zero taxes being produced from there.
“But it still has the burden — maintenance, utility, insurance and some emergency services required from there.”
But Sherman said Prime’s PILOT proposal for the City of Plattsburgh project was more forgiving than its other agreements.
The Board of Education member pointed to the group’s other tax agreements, like one in the City of Cohoes where the developer averaged a 58 percent exemption.
And, Sherman added, the interests of the City School District seemed to have been left out of the equation.
Like the City of Plattsburgh’s 2018 purchase of the Glens Falls National Bank, he said.
While a nearly $10,000 and $5,000 annual loss of tax revenue for the city and the county, respectively, Sherman said, the district had the biggest hit: $19,239.
“The notion that it’s just an $8,000 or $10,000 loss is not correct,” he said. “That’s strictly for the city.”
SCHOOL TAX CAP
Sherman said the City School District’s tax cap should be a consideration, too.
“There clearly is nobody making these decisions that understands school finance at all,” he said at the public hearing.
For a school district to exceed its 2 percent increase of its tax cap, it needs 60 percent of its residents to vote in approval, Sherman said.
“For the city, it’s four of six councilors — that’s it,” he continued. “To have a school district break a tax cap, it’s very, very difficult.”
As proposed, Prime’s PILOT agreement would cost district taxpayers $203,042 in year one and amount to $3,305,661 after 20 years.
For a household assessed at $100,000, Sherman said, that equates to $20.90 per year.
‘THEN IT’S A WIN’
Sherman said the City School District deserved a larger piece of the developer’s PILOT.
Somewhere between 85 percent and 100 percent should go directly to the district, he said.
Such an arrangement, Sherman said, would more than cover the cost of losses from the Glens Falls National Bank purchase.
“We’ve heard people say, and at meetings with School District representatives, if the money we make on the PILOT. . . is $1 more than the money lost on the bank, then it’s a win.”
Mayor Colin Read spoke at the public hearing, as well.
“I like the term PILOT,” he said. “Of course, that’s an acronym, but to an aviation mechanic, a pilot is a hole you drill to guide future work.
“This is really what we’re doing — we’re trying to guide future investment in the City of Plattsburgh like has never occurred before.”
And, he added, the initial investor deserves the assistance.
“This is the first entity that’s willing to put this kind of investment in our community,” Read said. “It won’t be the last, but to make sure that it is the first I think this incentive is very important for us.”
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