New Paltz resort seeks tax breaks

Steve Turk took the next step in pitching a resort for the former Plesser property in Ohioville on Monday, June 4 at a county Industrial Development Agency (IDA) hearing held at New Paltz High School. He explained why Wildberry Lodge & Spa can’t get off the ground without a tax-break package. Specifically, Turk is seeking to pay no sales tax during construction (estimated at about $1,225,000), a waiver of the mortgage recording tax of $225,000 and a net reduction in property tax of $9,743,071 over 15 years. The schedule for the payment in lieu of taxes (PILOT) would require paying only the tax on the undeveloped land for the first five years of operation, 25% of the additional tax for the next three years, 50% for two years and a gradual increase over the last five of the agreement until the tax on the full assessment is paid in the 16th year.

IDA chairman John Morrow noted that much of what is being sought could be obtained via state real property tax law § 485-b, which lays out business investment exemptions, but Turk said later that he was seeking relief through the IDA — which carries with it restrictions and requirements not found in state law — because he wants to show that he’s intending on investing in the community, as a local business owner.

The promise of jobs created is explicitly expected in these applications, and the Turks — Steve and his wife Shelley are equal partners in the project — expect to employ 145 people at the resort. Per the application, that includes ten managerial or professional positions paying in the range of $44,000 to $80,000 annually, 25 classified as “skilled” who will earn $36,000 to $40,000, 72 semi-skilled workers who will be paid anywhere from $25,000 to $30,000, and another 52 unskilled employees whose gross pay will range from $15,080 to $24,000. Steve Turk spoke about the number of high school and college students that get their start at Rocking Horse Ranch, a Turk property in the Town of Lloyd, and several speakers during the hearing spoke effusively about the opportunities this project would provide for younger workers.

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During the building phase, 182 construction workers will be kept busy, keeping them off unemployment for the two to three years the project takes to get completed.

Three-quarters of these jobs should be on the books during the first year of operation, with the remainder being hired during year two. IDA clawback provisions ensure that any tax breaks awarded are backed up by such promises bearing fruit; otherwise, the money must be paid back.

In its present iteration, Wildberry Lodge & Spa would have 140 hotel rooms, a fitness center, spa, restaurants, conference rooms, catering, a demonstration kitchen and outside amenities including a butterfly conservatory and open-air theater. Much of the 57.3-acre property would be left as open space, with the 138,000 square feet of building space being concentrated closer to the roads. To facilitate traffic, a roundabout would be installed at Paradies Lane, where county officials have been eyeing eliminating the left turn onto Route 299 for some time. While it’s not laid out specifically in the application, part of the project would involve upgrades to town sewer district #6, which has long been an expensive headache for Ohioville residents.

A number of people spoke in favor of the project, which is a departure both from PILOT discussions and deliberations about this particular parcel of land. They included Chamber of Commerce officials, the project architect, people with ties to the Turks and their businesses and New Paltz Town Supervisor Neil Bettez. Others raised questions, including more existential ones about why tax breaks should ever be awarded, but also queries specific to this project: what might these jobs pay, will there be sufficient mass transit for employees and how might new federal tax rules impact deals like these.

The hearing was closed, but written comments will be accepted until 5 p.m. on June 8, with IDA members deliberating on the application at their June 13 meeting. That will be back at their regular time and place, 8 a.m. in the county office building in Kingston.

There are 7 comments

  1. FunkieGunkie

    Welcome to the corporatization of New Paltz where the largest business in the Town get to pay the least in taxes. Mohonk Mountain House, a fortune 500 business and castle on top of a mountain, valued at only $2.5 million pays only $89,000 a year in taxes. Mohonk Preserve with no castle and a not for profit with assets worth $25.5 million pays no taxes. Open Space Institute (ie. Rockefeller family) leases Town land with no payments to the town (River to Ridge Parking lot). Now a $42 million dollar project and for profit hotel, fitness center, conference rooms, restaurants, etc. wants tax relief of $11.2 million so they can further clog the Town of new Platz with more tourism? Since the Town is already a tourist trap I can’t see how this will help anyone except the project owners. And since the outlying towns need tax revenue why wouldn’t they build in an area that needs their tourism. The taxes in New Paltz are some of the highest around and the infrastructure is deteriorating. So what do the taxpayers think they are getting for their money? I’m not really sure, glad I don’t have to pay their taxes and content I don’t have to visit very often.

  2. Alessandra K

    First – the headline of this article has a glaring typo with incorrect information. So, don’t always believe what you read on the internet.

    Second – To answer the tired and usually baseless complaint that people love to toss around about ‘what’s this doing for me / the town. I’ll tell you. Not because I have anything to do with this project, but more because it is tiring to see the pile on that people do…out of fear, out of misinformation, even out of ignorance. And…because New Paltz suffers dearly from a bizarre ‘keep out’ mentality that does nothing but hurt, well, New Paltz.

    So here we go. We’ll base it on the Powers of 10. (Google it if you must. Charles and Ray Eames – famous
    designers…it’s about getting out of your own little space and seeing the vast, bigger picture).

    Big picture: More than 1/3…and actually closer to 50% of all employment in New Paltz – Town + Village – are tied in one form or another to those horrible ‘tourists’ that you all seem to hate so much. (Top’s, gas, bank, movie theatre, coffee, food, lodging, culture, farms, tacos, car repair, wine shop, art store, sushi, Lola’s, Atavola,
    Ulster County Fair … you name it, they are the ones who make those places survive. Odd, this irrational dislike, because without them much of what is here ceases to exist. Beyond that, the dreaded nature-loving, money-spending, hard-working visitors who fall in love with New Paltz (much like we all have…which reminds me…very few people are “from” New Paltz…they came here for one reason or another, liked it, and stayed. Sounds like a tourist, or a student, doesn’t it?!?!?!?)

    Focusing in a little closer. In my 20-years here, I always make myself leave, because when I come back the ‘big things that I thought were ‘real’…let’s play with traffic for example…really aren’t that big, or bad, or despicable…folks try and try to make us feel as if they are, but they really, really, really are not. I mean, a locality with duplicate and overlapping services that fights against its school improvements as we have, that won’t let a new bus station be built…stuff like that is big.

    Zeroing in…well, the naysayers tried to kill that, Zero Place, but thank God level heads prevailed. We all say we want housing in town…but then we kill that when it’s time to stop talking and actually walk the walk. Which leads us to the issue at hand – building a new resort.

    Remember how the new Hampton Inn was going to destroy New Paltz forever with traffic and the use of police and fire services and ruin everything; some people even argued it would tax the school system…? It Did Not Happen. No new traffic. Not a single emergency call. No new kids in our schools. None of it. But it was an EPIC source of gloom-doom-drama for this town.

    The same applies now. The TRUTH about the area where the lodge is to be built is that LOCALS on
    Monday-Friday are the ones making normal rush-hour traffic at rush-hour. That’s you and me. The horrible tourists are gone or haven’t arrived, yet. That’s just us!!!

    As for comparing a lower tax rate in exchange for investing millions of dollars that WILL IN FACT ADD TO THE TAX COFFERS to something like Mohonk is comparing an apple to an orange. This new resort is a land-swap preserve; or a state preserve. It’s a commecial property that in addition to hiring local talent for construction, and I know those supplies will be coming from right down the road at Lowe’s and other Ulster County sources, and even with a “tax break” will still be paying money into the town coffers.

    It won’t put any kids in our schools, doubt you’ll have more than 5 annual calls for any sort of ambulance to take them to Poughkeepsie. It doesn’t put anything here but jobs and visitors who – oh darn them – will eat in our
    local restaurants, shop in our locals shops, attend our local attractions. Such a lousy thing!!! Supporting our town.

    All sarchasm aside, you can hate tourists, you can hate rich people, you can hate white people, you can hate government – hate whatever you want. But that really doesn’t mean you get to take a big stinking poo on every proposal that tries to come to town.

    I support it. Most of us support it. So I hope they get shovels in the ground and get this thing going already.
    Enough whining! Go do something meaningful like get them to pave Main Street or fix up the Shoprite Plaza.

  3. Les

    New Paltz would be better served by shifting the concept of ‘tax breaks’ into a concept of lower taxes for new projects that place part of the revenue earned into what cities like Philadelphia are starting to do – fund affordable housing for working families.

    Article Here:

    A bill that would levy a tax on new construction projects to provide funding for affordable housing has made a major step forward, and Philadelphians are torn over what it could mean for the city.

    The bill, which passed the City Finance Committee in a 6-3 vote Wednesday, proposes putting a one percent tax on all new constructions or major renovation projects in order to raise the money for affordable housing projects. A separate bill, which also passed the committee Wednesday, would allow the Housing Trust Fund to establish a sub-fund to determine how the money is spent; it could be accessed by both non and for-profit developers to build for households making up to $105,000 a year.

    Supporters of the bill, like the Philadelphia Association of Community Development Corporations (PACDC) have said the bill could raise $20 million per year or more for affordable homes.

    In a press conference on the bill in April, City Council President Darrell Clark said the construction tax would put Philadelphians first.

    He added that he knows Philadelphias are concerned about a “tale of two cities,” and expressed hope that the bill would help stimulate growth in neighborhoods outside of Center City.

    The Building Industry Association (BIA) even came out in support of the bill, with Leo Addimando, the BIA’s Vice President saying it could incentivize developers to build more mixed and affordable housing.

    “We as an industry group acknowledge that there’s growing need of affordable housing in this city,” Addimando said in April.

  4. Steven L Fornal

    My attempt to analyze the reality. I’m sure it’s more complicated. But, here’s at least a ballpark estimate:

    145 FTE jobs means 145 times 2080 (FullTimeEquivalent) hours per job equals 301,600 hours total. 301,600 hours times $10.40 (NYS minimum wage in Upstate NY as of 31 December 2017) equals $3,136,640 of taxable income. That’s $164,673.6 (at 5.25 percent NYS income tax rate for a single person making $21,632) per year. However, as the minimum wage is to move upwards to $15 an hour (31 December 2019) that income per job becomes $31,200 taxed at 5.25 percent equals $1638 per times 145 equals $237,510 per year.

    So, that’s going to theoretically bring in $3,562,650 over 15 years. Of course, the multiplier effect is always mentioned (like sales tax for instance). But, giving $11,000,000 for that kind of return (and we’re not sure if the IDA has updated their contract to include claw back clause in case the jobs promised aren’t provided) doesn’t really seem to be such a bargain.

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