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A. Thomas Levin Quoted in Long Island Herald, "Residents, Officials Protest Higher Tax Bills"

Nov 3, 2016Local Government and Land Use

Bob Barra stormed toward board members at the Oct. 26 Town of Hempstead Industrial Development Agency meeting, jabbing his finger at them as security guards blocked him and people in all corners of the room yelled.

“You’re not going to get away with that!” Barra shouted. “You didn’t do anything! You’re not going to get away with that! No you’re not! I’m the village administrator!”

Barra, the clerk for the Village of Valley Stream, was reacting to IDA Treasurer Jonathan Kohan’s insistence that the office of Valley Stream Mayor Ed Fare had been notified in advance about a drastic tax break for the Green Acres Mall, which reduced the mall’s tax payments by $6 million this year and by a similar amount each year until 2022 as part of a payment in lieu of taxes agreement, or PILOT. That helped explain why tax bills in school districts 13, 24 and 30 increased, on average, between $322 and $758 this month, drawing fury from unsuspecting residents.

“You’ve got a lot of guilt!” Kohan shouted at village officials, who sat together at the meeting.

“You’re a goddamn wise-ass!” Barra fired back.

The meeting forbade public comment, and yet it was regularly interrupted by three or more people shouting at the same time. At one point, residents grew frustrated that the IDA board members did not have nameplates, so they demanded that they stand, one by one, and give their names and say where they lived. The board members complied, amid a rare interval of silence from the crowd.

A letter posted on the IDA website, dated Dec. 4, 2015, was sent to Fare, then-Town Supervisor Kate Murray, District 30 Superintendent Nicholas Stirling, Central High School District Superintendent Bill Heidenreich and Nassau County Executive Edward Mangano, notifying them of the deal. The letter contained no details about the tax break’s potential effect on local taxes, however.

In a since-deleted letter to Valley Stream residents that appeared on the IDA website briefly last week, the agency stood by its decision to grant the tax breaks. “All impacted taxpayers were invited in a timely manner through their tax district representatives to participate in the IDA process,” the letter stated. “Unfortunately, none of them responded to invitations to offer input of any kind.”

Valley Stream taxpayers aren’t the only ones who will feel the impact of the redistributed tax burden. The village has one of three centralized high school districts in Nassau County. Each elementary district must pay a portion of the Central High School District budget, based on the taxable property in that elementary district. But because the mall is coming off the tax rolls, District 30’s payment to the Central High School District will shrink. That shortage will be redistributed across District 13’s and District 24’s properties — affecting not only Valley Stream, but parts of Lynbrook, Malverne, Franklin Square, Elmont and North Woodmere that are included in those districts.

Hempstead Town Supervisor Anthony Santino announced last week that he would seek to remove the IDA board at the Nov. 15 Town Board meeting over its handling of the Green Acres deal. The town and the Village of Valley Stream have each announced plans to sue the agency to nullify the contract. Nassau County legislators Carrié Solages (D-Elmont) and William Gaylor (R-Lynbrook) unsuccessfully tried to delay legislative approval of the county tax levy on Oct. 31, according to Newsday. The two claimed that possible errors in the mall’s tax agreement with the IDA would affect tax rates.

The IDA board has hired a Saratoga Springs-based consulting firm, Camoin Associates, to revisit the fiscal impact statement that guided the decision to grant the PILOT application.

Thomas Levin, an attorney who specializes in municipal law and land use, said that as a general rule, once an agreement is signed, it’s a “done deal,” and the IDA can’t withdraw it without the consent of the other party.

Levin said that aggrieved parties (other than the general public) could challenge the agreement in court, claiming that the IDA acted illegally or beyond the scope of its authority, or that it failed to give those who want to challenge the agreement sufficient notice. Additionally, he said the IDA could sue the mall if it felt information was misrepresented in the PILOT application. If its decision stands, however, Levin said, there aren’t any obvious options to make taxpayers whole. Tax bills for Hempstead Town homeowners for the first half of the 2016-17 year are due Nov. 10.

“The tax levies are done, and they can’t be changed without some State legislation being passed to allow the Town or the local villages to make changes, and that is very unlikely,” Levin wrote in an email to the Herald. “The government can’t make payments to taxpayers to make up the difference, or otherwise subsidize the taxpayers, as that likely would be a gift of public funds in violation of the State Constitution.”

Green Acres also received a sales tax exemption from the IDA. Fred Parola, the agency’s executive director, told the Herald last month that the tax incentives were granted to prevent the mall from going out of business, which would have resulted in even steeper tax increases for area residents. Parola declined to comment further.

The IDA’s letter to the community also stated that Green Acres had filed lawsuits since 2012 claiming that it was being over-assessed. The letter justified the IDA’s decision by stating that it reviewed “convincing documentation” suggesting that the mall would be re-assessed and end up making payments similar to what is outlined in the PILOT.

“… [W]e’ve spent a fair amount of time looking at why your taxes went up, and yes, there’s no question as a result of the Green Acres Mall your taxes did go up,” Kohan, told residents at last week’s meeting. “The question is, how much of it is as a result of the Green Acres Mall, and how much of it is as a result of other factors?”