New IDA Hearing To Be Held 

By Stephanie Mariel Petrellese

An announcement by the Town of Hempstead Industrial Development Agency that another public hearing will be held on the Alrose project has left many with unanswered questions.

“Why do they need a supplemental hearing?” asked Garden City resident Sonja Slattery. “We’re all confused by this.” 

The supplemental hearing is scheduled for Friday, August 1st at 9:30 a.m. at Garden City Village Hall. Slattery is among a group of Garden City residents who have been following this issue since the first hearing was held on May 6th. 

Residents, along with the Village of Garden City, Garden City School District and Nassau County Tax Assessor Harvey Levinson, have opposed the granting of tax breaks to Alrose, who they perceive to be a well-financed operation willing to spend a reported $91 million to purchase the hotel. 

The average homeowner will be forced to carry a heavier tax load as the developer’s burden is lessened. Over a 10-year period, the school district has estimated the district will experience a loss of $2.8 million in tax revenue. 

The IDA deal with Alrose freezes the property’s current $1.7 million total for school, county and village taxes for three years. The corporation will make payments in lieu of taxes, known as PILOTs, which will increase modestly over the next seven years. The agreement also includes sales tax exemptions for the hotel renovation and exemption from a one percent mortgage recording fee. Woodmere-based developer Allen Rosenberg, who heads Alrose, has said the tax breaks are needed to close the deal. 

Despite the opposition, the IDA approved the tax breaks on June 10th. However, the Village and school district commenced an article 78 proceeding on July 8th to halt the sale and block the benefits. In return, Alrose attorneys filed a $20-million notice of claim against them, contending that their client will lose a $6-million deposit if the deal with the current hotel owners does not close on time. The Village and school district have since dropped their pursuit of a permanent injunction against the sale of the hotel but still plan to challenge the IDA’s granting of tax assistance. 

The Village and school district have taken the legal position that the tax abatement should be applied to the hotel improvements, not the current assessment, according to the IDA’s Notice of Public Hearing and Uniform Tax Exemption Policy and Guidelines. According to Village Counsel Gerard Fishberg, the IDA believes that the two cited sources are broad enough to cover the approved abatement.

However, a paragraph in the new Notice of Supplemental Public Hearing issued by the IDA has different wording which may reveal that the agency is attempting to make a correction. The new notice deletes a clause which stated that the agency seeks abatement “on the increased assessment, resulting from improvements to” the hotel. How this new hearing and notice will affect the current legal proceedings, as well as the vote already taken by the IDA, has yet to be seen. According to Fishberg, it appears that the entire process is starting over from the beginning. 

John Ryan, counsel for the IDA, is on vacation and did not immediately return a phone call by the Garden City News. Nassau County Tax Assessor Harvey Levinson strongly encourages Garden City residents to attend the August 1st hearing. Even though the IDA has legally met the public notice requirements, Levinson claims they should have gone above and beyond the minimal notification to increase public awareness. He said the agency should have placed an advertisement in the local newspapers and mailed a postcard alerting residents to the fact that another hearing is going to be held.