Tonight, as the council discussed a draft resolution for charter reform that we helped to create, we listened in shock as Ward 5 Council member Don Tallerman accused KingstonCitizens.org of corroborating with Neil Bender’s Kingstonian lawsuits, saying that our volunteer advocacy group was “Holding a gun to our city”.
A year later, and in support of our entire community, we created draft language to help our council, taking the time to do some research and looking at communities similar in size and scale locally (all of which is cited in the original google document for the entire city to review) for a resolution that would allow the council to hire its own staff, have a say in the appointments/removal of committee, boards and commission members and formalizing mandatory training for council members (the Board of Education has yearly trainings).
Disregarding the substance, Tallerman said that KingstonCitizens.org’s main supporter is engaged in a dozen lawsuits. “Why would we entertain a suggestion from an entity who is holding a gun to our city…if a constituent comes to me with a good idea, and at the same time they are holding a gun up to the head of my family, no I’m not going to listen to that constituent when they are holding a gun up at my family’s head.”
Is it appropriate for an elected official to use a gun reference to describe the advocacy work of constituents? What’s the message he is trying to deliver? He ought to be censured for what he said tonight.
In a recent Board of Education vote, candidates who were placed on the ballot as retribution for the BOE Kingstonian vote lost the election.
In another major upset, longtime legislator and Kingstonian supporter Dave Donaldson lost the democratic line during the primary to newcomer Phil Erner.
Why is Ward 5 Alderman Don Tallerman Angry at KingstonCitizens.org?
Over the years, we have called for Council member Tallerman to recuse himself from any Kingstonian project vote due to his conflicts. We’ve created a timeline of those items as well as to how it pertains to our recent charter reform request. REVIEW the timeline
CORRECTION: The speaker Jessica’s title is Empowerment Coordinator. Her comments regarding the Kingstonian are her personal opinions and do not reflect the opinions of the YMCA.
At last evening’s public hearing, dozens of community members provided testimony in front of the Kingston Common Council’s Finance and Audit Committee to support or to question the transfer of 21 N. Front Street, a publicly owned parcel, to the Kingston Local Development Corporation (KLDC) by the City of Kingston Common Council. The transfer request was made by Mayor Steve Noble in order to provide the public parcel (assessed at $724,000. Its true value would be higher and is not yet publicaly known) to the developers in exchange for “public benefits” that include a couple of public bathrooms (it is believed that they will be located on the other side of Schwenk Drive at Herzog Plaza, owned by one of the developers). Although it is true that the community was aware of the council’s role in selling or leasing lands that would include 21 North Front Street and Fair Street Extension, the KLDC was not included as an involved agency in the developers Environmental Assessment Form. READ: Finance Committee Discusses Transfer of 21 N. Front Street to Kingston Local Development Corporation (KLDC) on February 10
Not lost on us, was that although some of the council members names were rattled off at the start of the meeting as being present, all but one chose to be on camera to assure the public that they were attentive and taking the matter seriously. Davis, Hirsch and Schabot, all Democrats, are running for reelection in the fall of 2021.
The developer’s public relations team initiated a new form letter that was included in the public hearing packet (that is available on the City of Kingston’s website). It’s expected that council members will receive dozens more. More highlights:
The Bruderhof community:
The Jordan Family:
The City of Kingston’s Finance Committee will hold a special Finance Committee meeting on Monday, March 1 at 6:30pm (although the city calendar also says 6:00pm) where council members are expected to vote on the transfer of 21 North Front Street. Although there will not be public comment, you can call in to the number below, or stream live at the City of Kingston’s YOUTUBE channel.
Topic: SPECIAL FINANCE/AUDIT COMMITTEE MEETING Time: Mar 1, 2021 06:30 PM
Dial by your location +1 646 558 8656 Meeting ID: 875 3817 4793 Passcode: 43255357
Anyone wishing to speak or to submit a written comment can email City Clerk Elisa Tinti at email@example.com (by 3pm on 2/25)
WHEN Thursday, February 25th at 6:30pm
WHY The Mayor of Kingston has requested that the Kingston Common Council transfer a city owned property to the Kingston Local Development Corporation to give to the Kingstonian project developers for their luxury housing and boutique hotel project in Uptown, Kingston.
The Kingston Common Council’s Finance Committee will hold a public hearing on Thursday, February 25 at 6:30pm regarding a proposed transfer of city-owned property that is currently being used as a municipal parking lot and public park at 21 N. Front Street to the Kingston Local Development Corp (KLDC). The transfer would allow the KLDC to facilitate the property’s use as part of the Kingstonian, a proposed luxury housing and boutique hotel project in Kingston’s historic stockade district in Uptown, Kingston.
The public can provide testimony for the record that evening as to whether or not they have concerns about the city transferring a piece of public land currently being used for a municipal parking lot and public park to a luxury developer who has already secured tens of millions of dollars of public subsidies. It is unclear whether or not the city intends to sell the parcel or to provide it to the developers for free. Following the public hearing, the Finance Committee will vote during a special Finance Committee meeting on Monday, March 1st at 6:30pm prior to the council’s caucus at 7:00pm. It will likely move out of committee and onto the floor for a full council vote the following day on Tuesday, March 2 at 7:00pm
Thanks to a LETTERsubmitted by Victoria Polidoro on February 10, the attorney representing several Uptown Kingston building owners, please consider the following concerns in your testimony that she identified:
1. The 21 N. Front Street property is currently used as both a public parking lot and public park. In order for the City to transfer the parcel to the Kingston Local Development Corporation (KLDC), it must first find that the property is not needed for its current public purpose.
2. Regardless, as it pertains to the public park, Not-for-Profit Corporation Law prohibits the City from conveying any land that is “inalienable as a forest preserve or a parkland.” The issue of whether the Park constitutes inalienable parkland is currently pending before the Ulster County Supreme Court and any action to convey the Property before this issue is decided would open the City to further legal action.
3. It is apparent that the City is seeking to convey the Property to the KLDC in order to do what it is otherwise prohibited from doing, conveying a city-owned parking lot to a private developer for free. The City must fulfill its obligations to its taxpayers and negotiate a fair price for the Property. In doing so it would require, at minimum, an appraisal of the fair market value of the Property. The City has assessed the Property at $724,000 and its fair market value is likely significantly higher since the pandemic has caused Ulster County to have the fastest rising property values in the Country.
4. Given that the Project will actually reduce publicly available parking and frustrate the Property’s public purposes, the City cannot justifiably claim that the conveyance of the Property will be paid back in the form of public benefits. Moreover, any alleged public benefits have already been presented by the developers as the basis for grants and PILOTs worth tens of millions of dollars and zoning amendments custom-tailored to allow the Kingstonian.
If permitted, this conveyance would result in the elimination of an existing public parking lot and the construction of an inadequate replacement of those parking spaces in the form of a private parking garage. After everything the City and its residents have given and will give up to indulge the Kingstonian, the City must ensure that it receives fair compensation before handing over City-owned, publicly-utilized Property to private developers.
Next up. The closure of Fair Street Extension in Uptown Kingston for the Kingstonian project will be next on the Kingston Common Council’s list of giveaways. According to city code Chapter 355 Streets and Sidewalks, in Article XIII Procedures for Disposing of Certain Streets unlike the municipal parking lot being transferred to the KLDC, the council will need to approve the “sale” of the street. That is, unless the Mayor and his lawyers find a clever way to work around the language in the code. There has never been a more willing council.
VIEW “Finance Committee Discusses Transfer of 21 N. Front Street to Kingston Local Development Corporation (KLDC) on February 10” (KingstonCitizens.org)
With the approval of the Kingstonian project’s unprecedented 25-year PILOT, the remaining governmental approvals for the development will be initiated. On Friday, January 29th, the Mayor of Kingston submitted the first of those with a communication from his office to the Common Council President requesting the “transfer of 21 N. Front Street to the Kingston Local Development Corporation (KLDC)” be assigned to the appropriate council committee. It is one of a two part decision making process required by the Kingston Common Council for a parking garage to accommodate the Kingstonian project’s luxury apartments and boutique hotel. Step one, the sale or lease of land and step two, the closing of Fair Street Extension (see image above).
Once the city property is transferred, the council will move forward with a decision to close Fair Street Extension. Although the assessed value of 21 N. Front Street is known to be $724,000, the value of Fair Street Extension remains unknown.
As there isn’t a public comment opportunity during the council’s finance committee meeting, the public may watch and listen to the discussion starting at 6:30pm on 2/10 by visiting the City of Kingston’s YouTube channel.
CORRECTION: The Mayor’s communication is a request to transfer City of Kingston land (a parking lot) located at 21 N. Front Street and adjacent to the Fair Street Extension to the KLDC. Closing Fair Street Extension will follow this decision at a later date. READ Finance Committee Discusses Transfer of 21 N. Front Street to KLDC on February 10
Now, Fair Street Extension, which is both a pedestrian walk and car route from Schwenk Drive to Uptown, would be eliminated in this project, to make room for an entrance to a parking garage that would serve mainly the Kingstonian tenants and boutique hotel guests. KingstonCitizens.org has asked the Kingston Common Council during and since the Kingstonian project’s environmental review process to provide a value for the street to the public but has been utterly ignored.
Ever since Robert Moses began to allow Authorities to demolish or build whatever he wanted, they have become the most powerful means of avoiding public accountability in the so-called “public interest.” In this case, by transferring the property from the city to the KLDC, which he completely controls, Noble once again paves the way for an approval regardless of the lack of transparency in the process or having little public support.
We hope that the Common Council will disagree with the Mayor and take a different position: that a city street that outlines the historic bluff in the Uptown Stockade District, one of the oldest neighborhoods in America, has great significance and value as infrastructure that generations of Kingston residents have invested in. Is Kingston about to just give that away to these developers too? Where are the Friends of Historic Kingston on this? Like all other things related to the Kingstonian, the majority of Kingston’s historic preservation community have been publicly silent.
What is the KLDC?
The Kingston Local Development Corporation (KLDC) is a not-for-profit organization that was set up in 1994 in order, or at least in part, to take over the Kingston Business Park. Today, its board consists of 11 members, of which the Mayor is one and it is he who appoints the remaining 10 members. The lack of transparency in allowing a single person the authority to fully control the makeup of boards, committees and commissions, and thereby their decisions through appointments is just another instance of our flawed and failing charter.
In an older article, the KLDC is described as “exempt from many rules and laws that local governments have to follow. They aren’t subject to public procurement laws that require certain contracts to be bid competitively. And debt they can issue — even if for the benefit of a local government — isn’t subject to limits established for most municipalities in the state constitution.”
As of 2021, the KLDC is composed of members of Kingston’s business community, with an emphasis on banking and real estate:
Mayor Steve Noble, President Noble is the Mayor of Kingston and in our opinion, one of the Kingstonian developers. He appoints all members of the KLDC with no oversight. Additionally, the Executive Director of the KLDC serves at the pleasure of the Mayor.
Andi Turco-Levin, Vice President Turco-Levin is a former Council member and Kingston mayoral candidate (R). She is a real estate agent also serves as a board member of the Kingston Uptown Business Association (KUBA). Andi lives in the Town of Ulster, which might disqualify her from serving. READ the KLDC bylaws.
B.A. Feeney, III, Treasurer In 2014, former Alderman Brad Will, who served as the Kingston Common Council Alderman liaison to the KLDC,wrote a critical letter about the Kingston Local Development Corporation, questioning if the quasi-public agency was meeting its obligations. At that time, Will noted that the KLDCs $1.9 million dollar bank balance was held at Catskill Hudson Bank, a change from when its money was split among five or six institutions. Feeney was the KLDC treasurer then and still is today, who now serves as the assistant vice president of the Catskill Hudson Bank.
Brad Jordan, Secretary Jordan is one of the Kingstonian developers. Although the organizational chart of 2021 shows him still serving on the KLDC, he is rumored to have just recently stepped down after 20+ years of “serving” on the board. If this rumor is true, it would be convenient that he leaves the KLDC just before this transfer of property is attempted. Jordan owns Herzog’s Plaza. He is also a member of KUBA.
Glenn Fitzgerald Retired Kingston businessman and native Kingstonian! Have been a KLDC Board Member for the past 27 yrs. and was appointed by Mayor T. R. Gallo. (Clarification: Glenn Fitzgerald is not a real estate agent at Win Morrison. We have amended his bio line above to reflect the change)
Hayes Clement Clement is a former Council member, Kingston mayoral candidate (D), a real estate agent at Berkshire Hathaway, also a member of KUBA. He serves on multiple city boards including the Historic Landmarks Preservation Commission and the Heritage Area Commission. On several occasions, Hayes has already voted on aspects of the Kingstonian project.
Albert Teetsel Teetsel is a retired banker and former Council member (R).
Miles Crettien Crettien is a Business Designer with a “passion for implementing sustainable development strategies for local economies.” He is co-owner of Lunch Nightly in Kingston.
Patrice Courtney-Strong Courtney-Strong is Vice President of Courtney Strong Inc. She is a former candidate for the State Senate and Ulster County Executive office (D).
Paul Cascario Cascario is CEO & Chairman of the Board at the insurance company the Reis Group.
The Kingston Common Council must step up to its fiduciary responsibility and provide the value of Fair Street Extension, an important city street that outlines a historic bluff in our historic Uptown Stockade district and that provides an important connection that moves traffic to and from uptown Kingston.
Call to action: On Tuesday, February 2nd at 7:30pm, please attend the Kingston Common Council remote meeting and tell them you are opposed to giving away Fair Street Extension to the Kingstonian Developers.
Sign-up to speak: Please sign-up to speak by writing to the City of Kingston Clerk Elisa Tinti at: firstname.lastname@example.org by 4:00pm on 2/2
Tell the Kingston Common Council that the wealthy Kingstonian developers have already being given tens of millions of dollars in public benefits, including a $26.2 million dollar 25-year tax deferment in exchange for a $17 million dollar parking garage for luxury tenants and boutique hotel guests, and at least $6.8 million in taxpayer funded grants. Demand that they step up to their fiduciary responsibilities and provide the community with the value of Fair Street Extension, which will be eliminated.
On Wednesday, January 20 at 9:00am, the Ulster County Industrial Development Agency (UCIDA) approved a 25-year $26.2 million dollar payment-in-lieu-of-taxes (PILOT) for a luxury housing development. It’s really the first of its kind in Ulster County, unprecedented not only in its size but also in providing a whopping tax break for a private housing project without the consent of all of the impacted communities. It’s a stunner, too given the new information that has emerged about the harm PILOTs incur, including the massive hit to school district budgets. In this case, all for a monolithic prefab luxury housing and hotel project to be located in our beautiful historic Stockade District.
A $26.2 million dollar PILOT for a $17 million dollar parking garage?
To understand what Dr. Eynon is referring to when she speaks of the developer’s “But for”, you have to go back to the July, 2020 UCIDA meeting where Kingstonian developer Joesph Bonura (alongside the City of Kingston’s Mayor Steve Noble) gave a presentation on their PILOT request for a parking garage. (click on the image below to hear Bonura’s “But for” explanation)
Communities throughout Ulster County take a stand.
There could be grave consequences for all communities in Ulster County going forward now that private mixed-use housing projects can qualify for PILOT applications and the IDA may override any impacted municipality who opposes it. The Village of New Paltz (VoNP) Mayor Tim Rogers and Deputy Mayor KT Tobin understood that early on and with their Town Board passed a position statement that PILOT agreements are harmful to local governments and school districts, especially now.
Fortunately for VoNP residents, their representatives have acted on all of their behalf, having been vocal throughout the entire Kingstonian PILOT process. Mayor Rogers in fact held the IDA accountable right up to the final moments of their meeting last week. Because of their advocacy, other impacted communities are starting to come forward. On January 13, the Town of Rosendale passed a memorializing resolution calling on the Ulster County Industrial Development Agency to exercise their authority and responsibility to uphold the Board of Education’s “no” vote and deny the Kingstonian’s application for a PILOT. (click on the image below to watch Mayor Tim Rogers during last week’s IDA meeting)
It’s not over. Take Action on the Kingstonian Project Process.
A growing number of community members throughout Ulster County are concerned and wanting to engage. Luckily, there is still time to make a difference in the outcome and to potentially rein in the UCIDA in the long run.
The Kingston Common Council still has an approval to relinquish Fair Street Extension to the Kingstonian Developers, an action that would eliminate a city street to provide an entrance to the project’s luxury housing and hotel parking garage.
“By concluding that the Kingstonian will have little or no impact on the character of the district, the Planning Board is essentially saying that buildings of the size, scale, type, density, and architectural style as the Kingstonian already exist in the district. They are also essentially stating that there will be no change to the historic development pattern; that closing a street and altering the natural topography of the the 362-year-old settlement—a key feature of the historic district’s significance—to accommodate a parking garage entrance on Fair Street Extension are inconsequential impacts. It also sets a precedent for future development of this scale in the Stockade Historic District.” “Planning Board sees no potential impact on character of Stockade District by Kingstonian Project ” By Marissa Marvelli
TAKE ACTION: Every seat of the Kingston Common Council is up for grabs next year. If you live in the City of Kingston, contact your council member and tell them that you want to be informed as to when they will vote to give away the Fair Street Extension to the Kingstonian Developers. Let them know that you are against the closing of this important city street for a parking garage. CONTACT THE KINGSTON COMMON COUNCIL
The Ulster County Legislature collectively approves appointments to the Ulster County IDA, but it is the Ulster County Legislature’s Economic Development, Tourism, Housing, Planning & Transit Committee that makes the appointment recommendations.
TAKE ACTION: Hold the Ulster County Legislature’s Economic Development Committee accountable. Demand that they review the recent policy changes (twice in a year during a project review!) by their IDA appointments that allowed PILOTs for private mixed-use housing projects as well as to stack the deck to override any impacted community’s dissenting vote, such as the Board of Education’s “no” vote in the case of the Kingstonian. CONTACT THE ULSTER COUNTY LEGISLATURE’S ECONOMIC DEVELOPMENT COMMITTEE
Even though the Ulster County IDA has voted to approve the Kingstonian PILOT, it’s not too late for your impacted community to take a position against their decision to override the Board of Education’s “NO” vote.
TAKE ACTION: If you live in the Kingston City School District that includes the City of Kingston, the Towns of Kingston, Esopus, Hurley, Marbletown, New Paltz, Kingston, Saugerties, Rosendale, Ulster, and Woodstock, ask your elected officials to take a position against the UCIDA recent action to override the Board of Education’s ‘no’ vote. To help you, we’ve created a draft memorializing resolution that can be used or amended by your representatives. DRAFT MEMORIALIZING RESOLUTION LANGUAGE
Finally, in today’s Daily Freeman:
Why is a $17m garage costing us $27 million in tax breaks? “If they could build without the PILOT, why is a $17 million parking garage costing us $26 million in tax breaks? Changing the policy of the IDA twice in six months just for the purpose of giving The Kingstonian a PILOT is not only wrong, but unethical. I would like an investigation by the New York State Attorney General’s Office into this action. I request all interested members of the county to go back and watch the IDA meetings and make the decision yourself. If you see what I see, start calling and filling out the forms as I am.” – Herb Lamb, City of Kingston Board of Education Trustee
Officials, please hit reset on Kingstonian approval “Look at the variety of cogent arguments against and concerning ramifications of approval that your own engagement processes and investigations into it did not unearth, glossed over, or minimized. Please update your perspectives, analysis, and responses to this PILOT, and instead of ignoring and dismissing critical information and concerns, incorporate the missing negatives that many have brought to you with respect to this project and the immense tax break it was just granted. – Village of New Paltz Deputy Mayor KT Tobin
In July of 2020, the developer publicly unveiled their 100% tax exempt PILOT that at that time was valued at over $30.6 million dollars (that includes the PILOT and other public funding sources) in exchange for a parking garage. Although the developers and members of the Kingston Common Council insisted that there wasn’t any wiggle room to improve the project or PILOT conditions, after much effort and advocacy by the public, the developer added 14 affordable units, a couple of public bathrooms and reduced the amount slightly that is deferred over time.
READ: “The road paved by a $30.6 million dollar Kingstonian PILOT (in exchange for a parking garage): A timeline and next steps in October 2020
The request went out to the three impacted agencies for their consent that included the City of Kingston, Ulster County Legislature and Kingston City School District. Although the City of Kingston (8-0) and the Ulster County Legislature (17-6) approved the PILOT agreement, the school board, which represents 60% of the impacted taxpayers throughout Ulster County, rejected the proposal (6-3).
One of the things that we learned throughout this process were the negative impacts that a PILOT has on school districts. In a recent article called “Strife over tax breaks and tradeoffs: It doesn’t have to be like this” by The Benjamin Center (penned by Robin Jacobowitz with KT Tobin and Josh Simons) the author, a graduate of Colgate University with a BA in Education, a Masters in Education Policy from Harvard University and Doctorate of Philosophy, Education policy, Organization Theory and Qualitative Research from NYU, the Director of Education Programs at The Benjamin Center and an elected trustee of the Kingston City School District Board of Education wrote, “Public schools are dependent on property taxes for the majority of their funding. When an entity does not pay its full share of property taxes, that burden does not go away; unless cuts are made, costs get shifted onto other taxpayers. So when a PILOT is granted to a developer everyone else has to pay more. And even in an instance where a PILOT might contribute more than was being paid by the pre-PILOT property, that property is still not paying its full share.”
THE UCIDA’S CLEVER “HOUSEKEEPING”
Meanwhile, the UCIDA released their AGENDA for next week that revealed more concerns.
There appear to be two different items that can trigger a multi-agency review such as what occurred with the Kingstonian PILOT. The first is a deviation from the Uniform Tax Exemption Policy (UTEP) and the second, the inclusion of housing. Notice that on page 27-28 of the agenda, Resolution No. 1020 changes the housing policy so that the UCIDA doesn’t need all taxing entities’ concurrence.
The UCIDA could perhaps override the other agencies on the deviation. But when they added in the opportunity to fund any housing project in the housing policy last summer, they required agreement of all agencies.
During their recent governance meeting (and two hour executive session) they must have changed the housing policy (again) to have the same language as the UTEP for the PILOT deviation, sneaking it in under the heading “housekeeping” by adding an “F” after the “E” in the Schedule A (see header photo).
Furthermore, the authority for an IDA to even fund housing appears to be a complicated question. The state authorizing legislation for IDAs doesn’t clearly allow IDA support for housing. According tosources, the courts have, over time, considered certain housing projects to qualify if the project “promises employment opportunities and prevents economic deterioration”. Is the UCIDA giving itself the authority to support any housing and does it have the power to do that? Perhaps it is why, in the resolution approving the Kingstonian PILOT, that they do a little dance defining the project as “commercial”.
I guess we’ll have to see what the board members do on Wednesday and when this is over, we hope that our elected officials – with much public pressure – use this most unpleasant experience to deeply scrutinize the UCIDA’s practices.
The UCIDA meets on Wednesday at 9:00am. Please visit their WEBSITEto learn how you can view their meeting and participate.
CALL TO ACTION:Families who have school age children in the KSCD, as well as Ulster County residents who pay Kingston City school tax (which is 60% of the KSCD population), please CLICK ON THIS LINK to send a letter to support the Board of Education’s decision to reject the Kingstonian’s unprecedented 25-year, $21 + million PILOT and request that the UCIDA follow its own policy requiring the approval of all impacted agencies for a deviated PILOT in order to take any further action.
By Rebecca Martin
At the December 2, 2020 Kingston City School District’s (KSCD) Board of Education (BOE) meeting, the Board trustees rejected a (revised) unprecedented 25-year, $21 + million dollar Kingstonian PILOT request by a 6-3 vote. Thoughtful, factual testimony about the “PILOT” (and not the “project,” the completely misleading talking point that some of our elected officials and the developer has been pushing) was provided by trustees Robin Jacobowitz PhD, Cathy Collins PhD, Priscilla Lowe, Herb Lamb, James Shaugnessy and James Michael.
Why is this significant?
The Board of Education is one of three taxing agencies – which represent tens of thousands of taxpayers in Ulster County – which would be impacted by the Kingstonian developer’s request for an unprecedented 25-year payment-in-lieu-of-taxes (PILOT) worth more than $21 million dollars for a parking garage (located in an opportunity zone no less) that, based on Kingston’s zoning code, would mainly provide parking for the developer’s high end housing project and luxury boutique hotel. The other two agencies are the Ulster County Legislature, which passed a newly crafted PILOT agreement by a vote of 17-6 (The Ulster County Executive branch commissioned a report by the National Development Council (NDC), who tweaked the PILOT in order to sweeten the pot for the school board) and the City of Kingston Common Council (which passed the original PILOT agreement, that would have proven to be even more harmful to the Kingston City School District, unanimously).
We’ve learned a lot over these past months about the concerning use of PILOTs in Ulster County and the negative impacts that they have on annual school budgets that must come under the tax levy limit. “Kingston City School District is funded by property taxes and state aid,” said James Shaugnessy, president of the Board of Education. “Property taxes are levied against the Full Taxable Value of nonexempt real estate…and if the (Kingstonian) project is subject to a PILOT agreement, then the new taxable value is never included.”
The Ulster County Industrial Development Agency (UCIDA) Amends its Policy to Allow Deviated PILOTs for Mixed-Use Housing Projects and Private Developers
On August 12, the UCIDA revised its Housing Project policy, authorizing their agency to grant tax breaks to “any housing project, or any mixed-use project that includes a housing or residential component, that has received the prior approval from the governing board of Ulster County and each town, village, city and school district in which the housing project is located.” (emphasis added). This change allows the Kingstonian developers to “deviate” to the tune of 25 years from the traditional matix, which is meant to encourage good economic development and measurable job creation, or real public benefits such as affordable or senior housing. In addition, it opens the flood gates to any private developer who would now be able to submit the same request.
Will the Ulster County IDA Override the Board of Education’s Vote to Reject the Kingstonian PILOT?
In a September 28 post by KingstonCitizens.org “The Complication of the Ulster County IDA Recent Policy Change and Public Hearing Date on October 1” we warned our community of the UCIDA’s new housing policy for mixed-use projects that implied that an approval for a deviated PILOT would require “prior approval from the governing board of Ulster County and each town, village, city and school district in which the housing project is located.” However, it also says that “…in the event that the Agency is not able to obtain the consents of all the affected Tax Jurisdictions to such deviation, the Agency may enter into such a PILOT Agreement that deviates from the policy set forth herein without the consents of such affected Tax Jurisdictions.” (emphasis added) In other words, if the UCIDA doesn’t get the answer they want, they can override a dissenting agency even if that agency stands to lose the most, such as the school district in this case.
When our concerns were checked with the UCIDA Chief Executive Officer Rose Woodworth by a local publication, she replied – and on record – that the agency’s policy of mixed-use housing projects and deviated PILOTs would need to get approval from all participating taxing jurisdictions, and that without those approvals they would not move forward.
Several months later, during the November BOE meeting at which Woodworth was a guest, and during which she received pushback from the majority of board trustees on the 25-year PILOT’s terms, she was asked squarely whether or not the PILOT would need the approval of all taxing jurisdictions to move forward. Woodworth said that she couldn’t answer that question for the board. Although their internal policy may require all taxing authorities approval, there was no such requirement under NY State law.
What happens next?
In July, the City of Kingston’s Common Council was the first of the three agencies to review the PILOT terms publically. They went on to approve the developer’s original terms, a 25-year 100% tax exempt PILOT worth $30.6 million dollars. Since late October, the new PILOT terms have gone in front of both the Ulster County Legislature and the Board of Education. According to the UCIDA, the Common Council will be required to vote again this time, on the revised PILOT terms. In the City of Kingston, all resolutions must go before an assigned committee (in this case, the Council’s Finance Committee) before going to the floor for a full council vote. Neither occurred in December.
However, if the UCIDA can approve the deviated PILOT with or without the consent of all three impacted agencies, then they could choose to not only override the Board of Education’s decision but also rationalize that because of the Kingston Common Council’s unanimous approval of the original PILOT terms, a revote wouldn’t be necessary. This would be unfortunate, as it would be in the community’s best interests for the Council to have to face their constituents and re-vote, following the BOE’s rejection of the PILOT. (**See Note Below)
We don’t know whether or not the Kingstonian PILOT will be voted on at the UCIDA’s next meeting on December 16. Keep an eye on their meeting page for when the agenda is posted. Until then, you can submit the letter in our “call to action” to support the Kingston Board of Education and to enforce a fair and transparent process.
CALL TO ACTION:Families who have school age children in the KSCD, as well as Ulster County residents who pay Kingston City school tax (which is 60% of the KSCD population), please CLICK ON THIS LINK to send a letter to support the Board of Education’s decision to reject the Kingstonian’s unprecedented 25-year, $21 + million PILOT and request that the UCIDA follow its own policy requiring the approval of all impacted agencies for a deviated PILOT in order to take any further action.
**NOTE: Since we published this post, we have learned that since the Board of Education rejected the revised Kingstonian PILOT terms, the Kingston City Council will not be required to revote. At this time, it is now the the UCIDA as to whether they will approve the PILOT agreement or not.
“25 years is really hard to swallow…this (PILOT) really shows how convoluted and complicated our funding system is and how problematic it is to fund school districts through property taxes…it is something that is often overlooked this issue with the tax levy and how it will impact our ability to raise funds going forward even after the PILOT is over…our levy is all that we’ve got and if this PILOT diminishes our ability to raise the levy over time that’s a problem that persists for decades…here’s the message. A deviated PILOT for 25-years doesn’t work for school districts. The way we are funded and the way that we raise revenue. It doesn’t work.”– Dr. Robin Jacobowitz, Board of Education Trustee
By Rebecca Martin
At the most recent Kingston Board of Education meeting on November 18, trustees had an unusual and perhaps unprecedented visit by Ulster County Deputy Executive John Milgrim and Ulster County Industrial Development Agency (UCIDA)’s Chief Executive Officer Rose Woodworth and their attorney Joseph Scott. The “county crew” advocated for the Kingstonian project’s proposed 25-year deviated payment-in-lieu-of-taxes (PILOT) for a high-end housing project. Almost apologetic at times, they defended the PILOT terms for well over an hour while board members said repeatedly that PILOTs placed the school board and their budget in a tough position, particularly one as long as 25-years. Why the developer and/or the county didn’t have this conversation with the Board of Education earlier in the year to solicit this critical feedback rather than as some last ditch effort in the eleventh hour is perplexing, and perhaps transparent unto itself. The Board of Education’s role in PILOTs appears to be more of an after thought rather than a respected partner.
The next meeting of the Kingston Board of Education will occur on Wednesday, December 2nd at 7:00pm where the trustees are expected to vote on the Kingstonian deviated PILOT.
The following are recent letters that were submitted to the Board of Education written by James Shaughnessy(although James submitted his comments as a Kingston resident, he also serves as the President of the Board of Education), KT Tobin, Village of New Paltz Deputy Mayor and Andrea Shaut(submitted as a Kingston resident but who also serves as President of the Kingston Common Council)
READ: I Oppose the Kingstonian PILOT Agreement“Universal public education in the United States is based on all nonexempt property owners paying a fair share of the cost of educating our students through property taxes. I documented what other large multi-family rental properties and hotels pay in school taxes to Kingston City School District. The Kingstonian project proposes a property tax abatement of approximately 90% for 25 years, which in essence is the reduction the property taxes paid by residents and guests.” – James Shaughnessy, City of Kingston resident and President of the Kingston Board of Education
READ: My comments strongly encouraging the Kingston City School District board to vote No against the Kingstonian PILOT“You are now evaluating a revised PILOT that has been characterized as a “win-win.” In my view, the revisions are miniscule, insulting, and far from enough to change my mind. Saying the increase in tax payments doubles a tiny initial dollar amount is disingenuous spin and the complete absence of any analysis of tax cap implications further demonstrates that the school district and the families that comprise it continue to have little consideration in this process.”– KT Tobin, Deputy Mayor Village of New Paltz
READ: I ask the members of the Board of Education to have the backs of our young people.“These memories have been flooding back to me as I watch on the sidelines the discussion of the Kingstonian’s request for a PILOT. Perhaps their tax break won’t immediately lead to the elimination of the music programs, but what if? And is it worth the students losing even the smallest amount of their education? We owe our youth the greatest of opportunities. I am not willing to watch even the possibility of them losing a portion of their educational experiences without pushing back, because every day I am grateful for my experience and the teachers that I had in Kingston. In my role as president, I do not carry a vote on the Common Council. So I am here instead as a former student, the daughter of one of our great teachers, and an educator myself to ask the members of the Board of Education to have the backs of our young people. They deserve the best we have to offer. Let’s not chip away at it.” – Andrea Shaut, lifelong City resident and Kingston Common Council president
We’re coming up on nearly three years of following the Kingstonian project process, a proposed $58 million dollar project that promises 129 high-end units, 14 affordable units (with Area Median Income (AMI) based on Ulster County, nearly ⅓ higher than the City of Kingston), a 32-room luxury boutique hotel, 9,000 square feet of retail space, and a 420 parking space complex. The proposed Kingstonian deviated payment-in-lieu-of-taxes (PILOT) is a 25-year, $30.6 million dollar deferment of taxes for a mixed use, high-end housing project. Since the Ulster County Executive has commissioned a study with the National Development Council (NDC) October 23, 2020 report, in an effort to ‘sweeten the pot’ doesn’t appear to have influenced members of the Board of Education – the agency who has the most to lose.
Here are the next important steps in the process for each of the decision-making agencies as we currently understand them.
Village of New Paltz
On November 4, the Village of New Paltz submitted the following letter to the Board of Education, members of the Ulster County Legislature, County Executive Pat Ryan and City of Kingston Mayor Steve Noble.
Prior to becoming Mayor of the Village of New Paltz, Tim Rogers went to business school and held a successful career in the financial industry. It’s clear in following his advocacy on the matter that our own elected and appointed officials in the City of Kingston do not understand the potential negative impacts that this unprecedented tax incentive may likely have.
“NDC’s suggested PILOT schedule for the Kingstonian is problematic for Kingston’s school district finances now and long into the future
National Development Council’s (“NDC”) October 23, 2020 cost/ benefit analysis for the proposed Kingstonian development is curiously silent about NYS Property Tax Cap law impacts and how PILOTs harm local taxing authorities’ ability to fund new services.
Property taxpayers, including those across the Kingston City School District that serves several municipalities, will likely face one of two outcomes if the Kingstonian developers receive the PILOT they asked for or if NDC’s proposed PILOT is used. The board of education will have to choose between:
Cutting school district programming (e.g. teacher and staff layoffs, increased class sizes, etc.), or
Increasing property taxes
This is just how NYS law and the Property Tax Cap formula works. It is unreasonable to list “net public benefits” from the Kingstonian without even mentioning let alone considering Tax Levy Limit (TLL) impacts. An alternative third option to these two could only occur if there was a material contraction in the number of students residing in the district.
School districts are primarily funded by property taxes and state aid. Property taxes are levied against the Full Taxable Value of real estate and its calculation is subject to the NYS Property Tax Cap law. Annually, each school district follows an eight-step formula to calculate its TLL. The TLL does not change when there is a change in the taxable value due to assessment increases; in that instance, the tax rate decreases. However, when there is significant new project construction, the NYS Commissioner of Tax and Finance calculates a Tax Base Growth Factor (TBGF) that increases the TLL to pay for services arising from the new construction.
If it’s fully taxed, the taxable value of $19 million for the Kingstonian would result in a TBGF of approximately 1.0042 and an increase in the district’s TLL of more than $440,000. However, when a new project is subject to a PILOT agreement, its taxable value is never included in the TBGF. This significantly limits a school district’s ability fund educating new K-12 students created by increases in housing supply.
Using NDC’s newly proposed PILOT, the Kingstonian developers would pay approximately $2.1 million over 25 years in lieu of school taxes. In comparison, if the project was fully taxed with an assessed value of $19 million at year 1 and the district’s ’19-’20 TLL of $105,589,983 escalated 2% annually, the developers would pay $16.6 million in school taxes.
Moreover, harm is perpetual. During years 26 through 50 the school district could see $23.8 million less in TLL because of the original PILOT. This would happen because the tax cap formula’s Tax Base Growth Factor never adjusts — even at the end of a PILOT’s term when properties become taxable.
Given these scenarios, if the district’s board of education opted not to cut programming because of its lowered TLL from the PILOT, the board could try to make up the difference and raise revenue by raising property taxes. This would require asking voters to support a tax cap override. And, a supermajority of 60% or more would be needed to vote in favor of raising taxes to offset the shortfall.
In 2020, only 13 districts across the state chose this option; there was a 69% success rate, compared with a 99% success rate for districts that did not need a supermajority approval of their budget. The Kingston board of education has never attempted a budget override.
We are troubled by this proposal to prop up investors of market rate for-profit housing, lodging, and retail. The Kingstonian could set a dangerous precedent for Ulster County that unfairly harms taxpayers and school districts’ ability to serve students. Please take a closer look at what is being considered.”
Kingston City School District Board of Education (BOE)
During a recent Board of Education meeting on November 4, Trustee James Michael, who also is chair of the Audit and Finance Committee, publicly revealed his concerns regarding the Kingstonian PILOT process and the Ulster County Executive’s NDC Study. Michael says that the BOE was not contacted by the consultant or the county while new PILOT terms for the Kingstonian PILOT report were being considered. Weeks after the report was released, the board said that it had still not received the new PILOT terms or any communication from the county. Superintendent Dr. Paul Padalino revealed at that time that he had received the new PILOT terms on that day (11/4) and would release it to the board following their meeting that evening.
The next Kingston City School District Board of Education meeting is on Wednesday, November 18 at 7:00pm. If you wish to submit public comment (live public comment is not permitted during Covid) please consider supporting the members who have correctly taken a stance against a PILOT for this proposal. WRITE: email@example.com
“Last Friday, I was reading the news with a headline that stated the county officials celebrated a new PILOT deal for the developers of the proposed Kingstonian project. That caught me by surprise. What I want to tell the county and the developer is that they ignored us (BOE) and they didn’t respect us at all. We are the biggest stakeholders of this development and the biggest losers as far as tax revenue…that’s what the politicians do. They always promise you something and do something else. Last year, Ulster County Executive Pat Ryan stated the Kingstonian project was unacceptable and absurd for the community. Politicians get paid, we don’t. We do this for the love of the kids. Politicians lie, but we don’t because we teach our children to be truthful and honest.”
“…(Joesph) Bonura stated on July 18 that if the PILOT agreement didn’t go through, the city would lose the $3.8m (Downtown Revitalization Initiative grant, DRI) grant….I met with Mayor Steve Noble and I asked him face to face, is it true that we can lose the grant money (DRI) if we don’t approve the Kingstonian PILOT and his answer was yes. That was a blatant lie….I had a conversation with the Director of the DRI grant program in the Hudson Valley. He told me that the city is not going to lose the grant. It can easily be allocated to the rest of the project.””We need more revenue for the district. They (the developers) were very arrogant, demanding and made an ultimatum and said either we have this project otherwise we don’t have a parking garage. Maybe the City of Kingston needs a parking garage, the developers want to build it and expect the city of Kingston taxpayers to pay for it, but to me that’s unacceptable.”
“When you think about the Ulster County Industrial Development Agency PILOT program, I want you to keep in mind the students because they have the most to lose and deprived of a good education…I send a message to developers, the Kingstonian developers and the future developers that the school district will not accept anymore deviated programs. I would suggest that the Kingstonian developers come back to the district with a more traditional PILOT program of 5- 10 years, not a deviated PILOT for two generations.”
City of Kingston Common Council
There has been mixed signals about whether or not the Kingston Common Council has to vote on the Kingstonian PILOTs new terms. It isn’t clear why they wouldn’t, as the terms are different then they were when their unanimous vote was cast over the summer. We’ll have to wait to see what sort of fancy footwork Kingston Corporation Counsel Kevin Bryant and Dan Gartenstein have in store.
If new PILOT terms appear, it would go in front of the Kingston Common Council’s Finance and Audit Committee (posted above). Please consider WRITING TO EACH OF THEM INDIVIDUALLY and request that if new PILOT terms appear for a council vote, that they align their decision with the Board of Education, as it is our children and tax paying families who attend the school district that have the most to lose.
Ulster County Legislature
In October when the Kingstonian PILOT terms were submitted to the Ulster County Legislature, both the Economic Development, Tourism, Housing, Planning & Transit and Ways and Means Committees each had a crack at it. At that time, it was already known that County Executive Pat Ryan had requested an “Independent” study regarding the Kingstonian PILOT terms. The Economic Development committee passed the old terms through anyway while Ways and Means tabled their decision until the study was delivered and the committee had time to review it.
With the results and new PILOT terms delivered in late October, the Economic Development committee did not take it up again during their November. We inquired with the Ulster County Legislative Clerk to understand why, and were told at the time of inquiry, “We still haven’t received any new document in relation to potential changes. As such, the resolution currently stands in the Ways and Means Committee. However, we anticipate having a new proposed agreement very shortly. The Ways and Means Committee members will have the option to amend the resolution in Committee to consider the new agreement.” Although the response didn’t answer our question thoroughly as to why the new terms would not have to be reviewed by both committees as was the case last month, at the Ways and Means Committee meeting this week, the committee adopted the new terms (that have not yet been made public). With much disrespectful banter from Legislators Dave Donaldson and Ken Ronk, Legislators Tracy Bartels and Lynn Archer called them out and held their ground securing the majority of votes to postpone the Kingstonian PILOT vote until committee members had their questions answered by the consultant. Legislator Eve Walters (New Paltz) publicaly stated that she would reject the Kingstonian PILOT agreement.
LISTEN to Audio of the Ways and Means Committee discussion of the Kingstonian PILOT from 11/10/20
The next Ways and Means Committee meeting will occur on Tuesday, November 17 at 5:30pm. If they decide to pass the new PILOT terms through their committee, it will go to the floor that evening at 7:00pm for a full legislature vote. Since Covid, the Ulster County Legislature amended its rules to allow only public comment on items listed in the agenda. In this case, we won’t know whether or not the Kingstonian PILOT will be on the agenda until 6:30pm that evening, 30 minutes before the legislature meets. NYS Open Meetings Law has no requirements for when Agendas are made public. It’s a flaw in our system, in our opinion. A good practice would be to post agendas at least several days prior to any public meeting in order to allow the public to plan to attend and to prepare their comments.
As we have recently reported, “The Kingstonian is a proposed $58 million dollar project. It promises 129 high-end units (to date, rents will range from $1,500 – $2,850), 14 affordable units (with Area Median Income (AMI) based on Ulster County, nearly ⅓ higher than the City of Kingston), a 32-room luxury boutique hotel, 9,000 square feet of retail space, and a 420 parking space complex. The developer is asking for a deviated Payment In Lieu Of Taxes (PILOT) agreement where they will pay nominal taxes for 25 years. Community members who have been following the Kingstonian project’s PILOT request have asked for more detailed financial information to understand the potential impacts (including the developer’s “trade secrets,” which are fair game for a public/private partnership). Others are up in arms that a wealthy developer who wants to create high-end housing and a luxury boutique hotel in Uptown Kingston would have the audacity to request a 25-year, 100% tax exempt PILOT agreement worth $30.6 million dollars. Nearly seven months after the SEQR process concluded (where the full value of public subsidies should have been revealed but were not), the developers finally shared their PILOT request with the Ulster County Industrial Development Agency (UCIDA) and threatening the board that without approval of the PILOT, they would not secure the financing that they need and that the City of Kingston was at risk for the project and the Downtown Revitalization Initiative (DRI) grant to “go away.”
Ulster County Legislative and Executive Branch throw curveball
On October 1st, Ulster County Legislator Lynn Archer appeared before the UCIDA during a Public Hearing on the proposed Kingstonian PILOT to announce that she and her colleagues were in favor of an independent, third party study of the proposed Kingstonian PILOT. “We are currently relying on the people benefitting from the project to provide the projected costs of the project without validation from an independent third party who has the knowledge of these types of complex endeavors,” she said. With the Kingstonian PILOT up for a vote in October it was a surprise and relief for a legislator to make that request. Up until that point, it seemed likely that the full legislature was poised to approve the PILOT terms even with so many outstanding concerns.
Several days later, County Executive Pat Ryan echoed those sentiments with his own press release, pledging that the county would pay for the independent cost benefit analysis. “Before a decision of this magnitude (the Kingstonian PILOT) is made, the public deserves an impartial assessment of the costs and benefits of the project. Therefore, I am calling on the project developers to disclose their financials to an independent evaluator so that we can have a full picture of the project. This level of transparency is critical given the scale and impact of the proposed PILOT agreement,” Ryan said.
On the same day of the County Executive’s announcement about his support for an independent review of the Kingstonian PILOT, a second announcement was sent from his office of a change in the Economic Development office. Tim Weidemann, who had served as Director of Innovation, was tapped as Director of Economic Development, replacing Lisa Berger who would now serve as Director of Tourism. Weidemann would coordinate the Kingstonian study on the county’s behalf with the National Development Council (NDC), a not-for-profit led by Daniel Marsh, a consultant who has a long history in the Hudson Valley.
When news hit about the selection of the NDC and Marsh in particular, some were concerned as to whether the organization could be impartial. Having served in a number of positions in Orange County, Marsh had also served as a consultant to the Kingston’s Local Development Council (KLDC) during the recent Gallo administration when Brad Jordan, one of the principal Kingstonian developers, was the council’s secretary.
The study was originally meant to be ready in time for the October 20th Ulster County Legislature Ways and Means Committee meeting and Kingstonian PILOT vote, and would cost somewhere in the vicinity of $10 – 15k, money that the county said it hoped would be reimbursed (by the developer, we presume). The promise for a study to examine the PILOT terms encouraged all of the other involved agencies to table their votes that month (that included the full legislature, Board of Education (BOE) and UCIDA) until the study was complete and each body had had the time to review it.
Community members who have been following the Kingstonian project’s payment-in-lieu-of-taxes (PILOT) request have asked for more detailed financial information to understand the potential impacts (including developer’s “trade secrets” which are fair game for a public/private partnership). Others are up in arms that a wealthy developer who wants to create high-end housing and a luxury boutique hotel in Uptown Kingston would have the audacity to request a 25-year, 100% tax exempt PILOT agreement worth $30.6 million dollars. Nearly seven months after the SEQR process concluded (where the full value of public subsidies were not and should have been revealed), the developers publically revealed their PILOT request to the Ulster County Industrial Development Agency (UCIDA) threatening the board that without their approval of the PILOT, they would not secure the financing that they need and that the City of Kingston was at risk for the project (and the Downtown Revitalization Initiative (DRI) grant) to go away.
According to Rose Woodworth, the CEO of the UCIDA, the ground rules for a deviated PILOT (meaning that it’s not a standard PILOT under the unified tax exemption policy) include the consent of the involved local jurisdictions and in this case, the Kingston Common Council, Ulster County Legislature, and the Kingston City School District’s Board of Education. She also noted that the UCIDA “…could, if it so determined, to move forward without the consents of the local jurisdictions.” The process that Woodworth nonchalantly describes reminds us of the worst part of top down culture. It is not meant to be fair or inclusive, but only to provide the illusion of participation. Those “in charge” may override a decision if it runs counter to their desired and in many cases predetermined outcome.
There are still steps remaining in the process for the Kingstonian PILOT, one of which is an independent, third party cost benefit analysis of the Kingstonians’ financials requested and paid for by Ulster County. The National Development Council (NDC) was hired only last week as an unbiased third party. The report, that the City of Kingston should have requested last year, should be available any day now. If released to the public (and it should as a taxpayer funded study for a public/private partnership) we will be able to learn its legitimacy based on the materials the NDC has solicited from the developer.
Earlier in October, when Ulster County Executive Pat Ryan announced plans for this study, the Board of Education tabled its discussion on the Kingstonian PILOT until they could review the report. The Ulster County Legislature’s (UCL) Economic Development, Tourism, Housing, Planning & Transit Committee chaired by Legislator Brian Cahill on the other hand went on to pass the Kingstonian PILOT resolution to “…be fair to the developers.” The PILOT resolution appeared next at the Legislature’s Ways and Means Committee chaired by Legislator Lynn Archer, where they wisely chose to table the discussion for the same reasons as the Board of Education.
The next bit may move very fast, with the Ways and Means committee meeting for a second time this month on Tuesday October 20 at 5:00pm. If the Kingstonian PILOT is on their agenda and it is passed out of committee, it goes to the Democratic caucus at 5:45pm and most likely to the floor for a full legislative vote at 7:00pm.
We’ve laid out a timeline of all of the events that have led us to this moment that you can review below. We conclude with “what’s next” for the remaining meetings regarding the Kingstonian PILOT in October.
There was good news (members of the Ulster County Legislature called for an independent, third party analysis as we did in our BLOG post last week. It’s the only sensible thing to do) as well as courageous and touching testimonies last evening during the Ulster County Industrial Development Agency’s public hearing for the Kingstonian project PILOT.
Here are the highlights. Click on the images to review each individual testimony.
There has been some confusion about the process for the proposed Kingstonian deviated PILOT, regarding whether or not the agencies (the Common Council, City of Kingston School District Board of Education (KSCD), and Ulster County Legislature (UCL)) must all agree on the PILOT terms in order for it to proceed. The source of that confusion stems from an expedient decision by the Ulster County Industrial Development Agency (UCIDA) to change its rules in ways that benefit the Kingstonian.
Rose Woodworth, CEO of the UCIDA clarified the question about the process and the Kingstonian deviated PILOT in a recent email:
In general, the UCIDA has the power to grant PILOT Agreements (and real property tax abatements).
In connection with the granting of tax abatements, the UCIDA has adopted a Uniform Tax Exemption Policy (the “UTEP”). Under the UTEP, the UCIDA may grant certain levels of real property tax abatements to project applicants.
As has been described both in the IDA Application and in media reports regarding the Kingstonian Project, the real property tax abatement being requested by the project applicant is a deviation from the normal real property tax abatement provided in the UTEP.
As provided in the UTEP, in cases of deviations the UCIDA is subject to the following requirements:
(D) Review by Agency with Affected Tax Jurisdictions. Before the Agency shall enter into a PILOT Agreement that deviates from the policy set forth herein, the Agency shall (1) notify each affected Tax Jurisdiction in accordance with Section 8(A)(2) hereof, and (2) attempt to obtain the written consent of all the affected Tax Jurisdictions to such deviation. In the event that the Agency is not able to obtain the consents of all the affected Tax Jurisdictions to such deviation, the Agency may enter into such a PILOT Agreement that deviates from the policy set forth herein without the consents of such affected Tax Jurisdictions. The provisions of this Section 8(D) shall not apply in situations where the Agency holds title to property for its own account.
“As noted in the above excerpt from the UTEP, the Agency is obligated to get the local approvals regarding the PILOT deviation. And, as noted in the excerpted language, the UCIDA could, if it is so determined, move forward without the consents of the local jurisdictions.“
In other words, even if the three impacted agencies –Kingston’s Common Council, KCSD and UCL — don’t all agree to support the PILOT and its substantial tax breaks for the developer, the UCIDA may proceed to approve this anomalous PILOT request on their own. In short, the UCIDA – an appointed and democratically unaccountable body – may make a lone decision to approve the PILOT without the consent of all of the impacted tax jurisdictions like the School Board.
Back in July, the City of Kingston and Ulster County Industrial Development Agency received a letter from Victoria L. Polidoro, Law Offices of Rodenhausen Chale & Polidoro LLP. Polidoro represents several property owners in Uptown, Kingston. The Polidoro letter informed the IDA that the law did not authorize them to grant the PILOT application. “As a threshold matter the IDA does not have authority to consider or grant the Application for the Project which includes residential housing units. The IDA’s Housing Projects Policy, which was reaffirmed on January 8, 2020, only allows IDA financing in limited circumstances. It provides that:
A. The Agency will only consider the granting of any “financial assistance” (as defined under the Act) for following projects that provide housing:
(1) a project that satisfies the definition of a continuing care retirement community project under Section 859-b of the Act; or
(2) a project by an industrial, manufacturing, warehousing, commercial,research and recreation facility (as defined in the Act) that provides workforce housing for its employees.“
With new information from the Polidoro letter, the IDA appeared to hastily approve a revised policy change a month later on August 12 authorizing their agency to grant tax breaks to “any housing project, or any mixed-use project that includes a housing or residential component, that has received the prior approval from the governing board of Ulster County and each town, village, city and school district in which the housing project is located.”
The UCIDA’s recent process change is troubling for several reasons worth analyzing. Through this policy change, the UCIDA has empowered and entrusted itself to unilaterally give away $30 million to wealthy real estate developers during a pandemic irrespective of the judgements of the very elected officials representing the jurisdictions impacted by the subsidy. The IDA itself is an appointed body and, therefore, democratically unaccountable, making their rule changes and subsidy granting power all the more offensive to the principle of procedural fairness. The damage done to due process by public officials who pledge to uphold the public interests is deeply corrosive, undermining a sense of trust at the core of good local government. We should demand more from those who represent us. At a minimum, citizens should expect that governing rules are clear, consistent and fair to all parties. Any changes to procedure should never benefit one party over another in the middle of a highly contentious process.
To make matters worse, the UCIDA has scheduled their required public hearing on the proposed Kingstonian PILOT, on October 1st, prior to the KCSD vote, which may take place on October 7 (or the 21). The UCIDA’s public hearing is also scheduled ahead of the UCL vote on October 20. By scheduling the public hearing before the other agencies (KCSD and UCL), the UCIDA prevents concerned taxpayers from addressing their members should either of the two remaining agencies reject the PILOT agreement for the Kingstonian. The UCIDA members have effectively foreclosed public comment following the votes of those other affected agencies, precluding an opportunity for the public to question them and advocate for fairness.
Thursday, October 1st at 7:00pm The Ulster County IDA public hearing on the Kingstonian PILOT will occur remotely. Please LIKE our facebook event to learn more about how you can participate.
The developer is asking for a payment in lieu of taxes (PILOT) agreement where they will pay nominal taxes for 25 years; a subsidy worth approximately $30.6M, in exchange for a temperature controlled parking garage that will primarily serve its high end tenants and luxury boutique hotel guests.
Over and over again, the Mayor of Kingston, members of the Common Council and the developers tell us that Kingston needs this parking garage and that, with a PILOT, it could be built at “no cost to taxpayers.” If a PILOT allows a developer to defer their real mortgage, property, school and sales tax, how does their project come at no cost?
The City of Kingston missed both of its opportunities to request an independent, external analysis of the Kingstonian developers’ economic assumptions. The first came during the State Environmental Quality Review (SEQR) that ended last December and the second during the recent common council special finance committee meeting in July. The developers’ revenues which they call ‘trade secrets’ were not disclosed to the public, when the PILOT terms were approved by the full council in August. The public needs to know the profit margin or the “trade secrets” in order to determine whether to approve the PILOT.
With two agencies still left to vote on the council’s PILOT terms, the developer is making another attempt to persuade members of the Board of Education (BOE) and Ulster County Legislature (UCL) to support the PILOT, with a public action form letter crafted without any real substance. “The PILOT will provide tax relief and public benefit at no cost to taxpayers.” There it is again. “No cost to taxpayers.” The developer also claims that “…they have worked with Kingston City officials and the IDA Board to ensure that the dollar value of the public benefits of the Kingstonian outweigh the PILOT at zero cost to taxpayers.” But without an independent, external analysis to review their economic assumptions, the tax paying residents of the City of Kingston and Ulster County will never know.
In their letter, the developer claims “…that the benefits of the project include twice the public parking, 129 market rate apartments, 14 affordable apartments, 30 hotel rooms (when it is actually 32), an outdoor public pedestrian plaza/gathering space, long-desired public restrooms, 300 + new consumers to the marketplace offering immediate relief to the business district and generating much needed sales, occupancy, and property tax revenue, and an estimated 153 new jobs.” But the developer still isn’t able to pin down the number of parking spots they need for this project, even though the City of Kingston’s zoning code says that nearly 313 of their 420 newly created parking spots will be required to serve their high-end apartment tenants and luxury boutique hotel guests leaving us with approximately 107 public parking spots, fewer than the 144 parking spots that we currently have now. Even with a waiver to allow them to provide less, there will now be an influx of people – tenants, hotel clients, uptown businesses and residents all vying for parking. They assert that the overflow can park across Schwenk Drive if their garage is full. So why is the public being asked to fund a parking garage when they may be losing parking spaces, charged higher fees and possibly not able to find a spot to park in the temperature controlled lot anyway.
As for affordable housing, the 14-units that various politicians claim credit for was due to the hard work of advocates that pressed the matter and won. The developer ended up making the concession but expanded the size of their complex, making their original 129-unit project even larger, with a whopping 143-units in the center of Kingston’s historic uptown. As reported earlier, it appears that the developers are following the Area Median Income (AMI) not for the City of Kingston ($48,186) but for all of Ulster County ($69,539) that could make those starting rents nearly ⅓ higher.
As for jobs, they promised 40 full time positions in their application. However, 84% of them were based on a single person’s salary, at $20.73 per hour. This is insufficient income for anyone raising a child, and certainly not enough to rent a one-bedroom apartment in the Kingstonian (or nearly anywhere else in Kingston.)
The developer claims that “…this project comes at an opportune time when our local economy is in need of job creation, both affordable and market rate housing, and sales tax revenue. The project also creates an immediate economic boost from the construction phase and revenue from the new taxes that will be generated.” But we know that the PILOT request is coming at the worst possible time, in the midst of a global pandemic, and when our local, county, and state economic futures are unclear. In early summer, the City of Kingston, in preparation for a hit to their budget, began furloughing and cutting some of its workers. Tax revenue for Ulster County is unknown and the state may hold back state aid for the City of Kingston School District by 20%, while residents’ school tax bills have increased. Our Mayor and Common Council endorsed the loss of revenue at one of the worst economic moments in the City’s history without requesting an independent, external analysis to review the developers economic assumptions to understand whether or not the immediate or long term benefits are worth the PILOT investment.
The developer says that “…this project was initiated by the City of Kingston, and is a true partnership between the City, School, County, State and the citizens of our community and that without this partnership the project is not fiscally feasible and the taxpayers will lose the multitude of community benefits and added revenues it brings.” But in our opinion, a true partnership includes a developer who stands to make a windfall in the City of Kingston paying their fair share of taxes. Some community members have asked if it’s even wise for a project to proceed when a project like this isn’t ‘fiscally feasible’ without a $30.6 million dollar PILOT. The proclaimed community benefits are a temperature controlled parking garage (that the developer needs more than we do to serve their high-end apartment tenants and luxury boutique hotel guests), a couple of public bathrooms, a pedestrian plaza with a water feature, an internship to train their future $15.00 per hour wage workers and a walkway over Schwenk Drive. Is that the way we want to invest our hard earned, finite tax dollars?
As a public/private partnership, we think our community deserves more information before it decides on the $30.6 million dollar PILOT. We encourage our elected officials at the BOE and UCL to be responsible and request that an independent, external analysis is performed to review the Kingstonian’s economic assumptions to be reviewed in turn by alltax paying residents living in the City of Kingston and Ulster County.
READ: The Kingstonian Project will require 343.5 parking spaces per Kingston’s zoning code
CALL TO ACTION:
We encourage all community members to draft their own letters to decision makers of the Kingstonian PILOT asking for an independent, external analysis of the Kingstonian’s economic assumptions and the feasibility of a $30.6 million dollar PILOT.