The new Middleburgh grocery store jumped a huge hurdle last week as school board members threw their support behind a new, 15-year tax-beak agreement.
Members of the village, town, and county board still have to agree to support the new deal before it is officially approved by all the board and the Industrial Development Agency, but it still marks a big step forward for the project.
MCS Superintendent Michele Weaver presented the revised payment in lieu of taxes agreement-or PILOT-to board members.
The agreement, which was brokered with the help of county officials Bill Cherry, Marjorie Troidl, and Sandra Manko, will likely be discussed by the village on Monday, June 13. Town board members could discuss it that night also (they are meeting in a joint meeting with the village) or on June 9 at their regular meeting. The county board next meets on June 17.
A resolution finalizing the PILOT could be approve by the school board next month.
Representatives of all four taxing jurisdictions met on May 20 and gave their unanimous support to the agreement.
"It's a win-win," she added, noting that the school, town, village, and county will get more property tax revenue.
"No one gave up on a project that is supported by everyone."
The new agreement has been shortened from the prior 20-years to 15, an important step.
"I'm glad they made movement off the 20," commented board member Ernest Kuehl.
The new proposal is still divided in two, one part for the grocery store and other commercial development, and the other for the 64 condominiums and common areas.
Under the proposal for the grocery store, the developers would pay $4,500 per year in property taxes for the first five years.
The payments would then increase each year through year 15, after which the properties will be fully assessed.
The property tax payments for years six through 15 will be:
• Year six: $6,250.
• Year seven: $8,000.
• Year eight: $9,750.
• Year nine: $11,500.
• Year 10: $13,250.
• Year 11: $15,000.
• Year 12: $16,750.
• Year 13: $18,500.
• Year 14: $20,250.
• Year 15: $22,000.
The payments on the condos will follow a similar arrangement.
The property taxes paid on the common areas will be $10,000 per year for the first five years.
From year five to 10, the tax for the common areas will be increased to $15,000 per year; in addition, there will be a payment of $2,000 per unsold unit of the 32 units built up to 32 units. The number of units eligible for taxes, would be increased to 64 starting in year 11.
Once a unit is sold, it will be fully assessed.
It will be much more likely that all 64 units will be sold at an average assessment of $100,000 or more, bringing in at least $366,912 per year in new income to the four districts.
PILOT payments will be split as follows: MCS, 55 percent; village, 15 percent; town, six percent, and county, 24 percent.
If all 64 units are sold, the district would get $200,334 in additional revenue, the village $56,504; the town $23,482; and the county $86,591.
Mr. Kuehl did note that if there was a big increase in enrollment due to the condos, the school budget would see a marked increase.
The village and town of Middleburgh had approved the original 20-year PILOT in April for the new store and condominiums but the county and school board never voted on the agreement.
Faced with an April 15 contract deadline on two properties, developers decided to halt the project.
According to the original proposal, for the first five years the developers would continue to pay a total of $2,200 a year, with no loss or gain to the school, village, town, and county.
For years six through 10, the owners would be paying the current $2,200 plus five percent of the assessed value of the buildings, which are still to be determined.
The payments for years 11 through 15 would be the current $2,200 plus 10 percent of the assessed value of the buildings and for years 16 through 20, the payments would be $2,200 plus 20 percent of the assessed value.
After the end of the 20-year agreement, the property would be assessed at 100 percent of the value.