Monday, December 2, 2024
Island Park residents, school district officials, and civic leaders are raising concerns over the 20-year payment in lieu of taxes, or PILOT, agreement with the developers of the Ocean Avenue Marina project, which was approved at the IDA meeting on Tuesday, Nov. 19 .
The plan to transform a 3.58-acre site on Waterfront Boulevard into a 117-unit luxury apartment complex is being touted by its developers as a much-needed boost to the local housing market. Opponents argue, however, that it will place an undue tax burden on residents.
John Vitale, a longtime developer in Island Park, plans to replace his now-closed Bridgeview Yacht Club and Loft catering hall with the waterfront complex. Vitale owns 10 acres of land at the southern tip of Island Park, just north of the Long Beach Bridge, where he once operated several restaurants, including Paddy McGee’s and Coyote Grill, which were decimated by Hurricane Sandy in 2012. Vitale also owns the Barnum Landing shopping center, and is a co-owner of the seafood restaurant Jordan Lobster Farms.
The proposed complex would comprise a four-story building with 74 one-bedroom and 43 two-bedroom apartments, as well as amenities including a pool, clubroom and garage parking. Vitale asserts that the project aligns with the community’s need for transit-oriented housing to attract young professionals and downsizing retirees.
His development company, Ocean Avenue Marina Inc., sought financial assistance from the Town of Hempstead Industrial Development Agency in the form of a 20-year PILOT agreement. The project will be exempted from standard property taxes, and instead make fixed payments over two decades. The approval deviates from the IDA’s usual 10-year tax-abatement policy, which has prompted additional scrutiny.
Island Park residents and institutions are still reeling from the financial fallout from the Long Island Power Authority tax settlement in 2022, which significantly reduced the assessed value of the E.F. Barrett Power Plant, forcing taxpayers to make up the shortfall in property tax revenue. Many residents, particularly seniors, say they are already struggling to pay their taxes. Island Park School District officials have also voiced concerns about depleting reserves to maintain educational programs.
The LIPA settlement has already reduced the district’s tax base by over 45 percent. Schools Superintendent Vincent Randazzo submitted a letter to the town IDA and attended an agency hearing on Oct. 30, along with other school officials and community members, to express his opposition to the tax break and to highlight the financial pressures on the district.
“The economic impact of the project and the proposed PILOT benefits cannot and must not be considered in a vacuum,” Randazzo said at the hearing. “Cost must be considered, but the impact of additional budgetary pressures arising from the project, in the context of the existing issues created by the LIPA-E.F. Barrett Power Plant settlement and other residential developments within the district, must also be considered.”
School officials emphasized that the additional tax exemption for the Ocean Avenue Marina project would further strain school funding and increase residents’ tax burden. Salvatore Carambia, the district’s business administrator, also highlighted its dire financial situation.
“A PILOT for the amount of time that they’re proposing is very detrimental to the district,” Carambia said. “I have received phone calls from our taxpayers. They no longer can afford to live in Island Park. I have seniors calling me, saying, ‘Sal, I can’t make these tax payments,’ and I don’t know what to tell them. These are people who love Island Park, and now we’re hurting them even more.”
The Island Park Public Library echoed these concerns, citing the increasing strain on its budget as well due to the LIPA settlement. The library is struggling to provide essential programs for children, and the effects of a PILOT for the new development would worsen the situation, officials said, requesting that the library be explicitly included as a beneficiary if a PILOT agreement is established.
The agency contends that the project would be impossible without the PILOT agreement. The Agency argues that financial assistance is necessary to offset high construction costs, rising interest rates, and the economic challenges of attracting tenants at competitive rents. The project’s proponents believe it will eventually generate more tax revenue than the underutilized property does today and add modern, desirable housing to Island Park.
Civic groups like the Island Park Civic Association have also opposed the proposed tax break. They argue that it will disproportionately benefit the developer while leaving taxpayers to shoulder the costs of maintaining schools, public services and village infrastructure.
“I don’t believe that he needs a 20-year tax abatement to have a successful project,” Civic Association member Richard Schurin said of Vitale. “He’s converting a successful catering hall to a rental development that’s going to be essentially identical to the rental development that’s right next door. So what’s the purpose of this? What you’re doing is you’re transferring money from me, a homeowner, to a successful developer.”
“I believe Mr. Vitale will develop that property without the PILOT,” Schurin said at the Oct.30 hearing. “It will be a successful rental development, and we want to be able to reap the benefits of that through the proper assessment of that property and the proper tax revenue that goes to the school district, which lessens my taxes, or at least keeps them the way they should be. It’d be an unfair burden that you’re passing on to us,” he told the IDA members.
