The way Ulster town supervisor Jim Quigley tells it, he was sitting in his office a few weeks ago talking with deputy supervisor John Morrow when Efraim Steif dropped in unannounced. Steif’s NCRNC LLC currently subleases and operates the Northeast Center for Rehabilitation & Brain Injury in Lake Katrine. With his business partner, Uri Koenig (60 percent owner), Steif (40 percent owner) is in contract to buy the land and the building from an entity whose majority holder is the estate of Tony Salerno, the visionary healthcare entrepreneur who died nine years ago.
The purchasing corporation is named after the address of the former Edgewater IBM building, 300 Grant Avenue, LLC. With the change of ownership, Steif promises to assume the rights and responsibilities of the existing Pilot (Payment in Lieu of Taxes). There will be no modification of the Pilot, which is in the 18th year of a 30-year schedule.
There was only one problem. Steif said he needed to close on the deal by the end of the year.
Since the agreement is a deviated Pilot, that is, a deviation from the Industrial Development Agency’s uniform tax exemption policy, 300 Grant Avenue LLC will require not only the IDA’s approval but resolutions of support from the three taxing authorities affected by the Pilot: Ulster town government, the Kingston school district and Ulster County government.
The original deviated Pilot schedules, like most such arrangements, started out with smaller tax payments and ascend toward larger payments toward the end of their term. That was the case with this one, negotiated 18 years ago mainly between the late Orvil Norman, representing the Ulster town board, and Lorraine Salmon, representing Tony Salerno in that transaction and now executive director of Institutional advancement at SUNY Ulster.
Under that agreement, the 208,000-square-foot Northeast Center, situated on 39 acres, pays its current Pilot payment for 2017 property taxes of $690,000. The amount will be the same in 2018. But in the subsequent year, and for the next four after that, the owners will, under the Pilot, pay $345,000 more toward property taxes, an annual total of $1,035,000. In each of the final five years of the agreement ending in 2028, the owners will pay $1,330,000.
Quigley told Steif that Morrow was also chairman of Ulster County’s IDA. That was a useful coincidence for the unscheduled visitor.
The Ulster IDA held a special meeting at 8 a.m. Wednesday, November 23 on the sixth floor of the county office building in Kingston. The 300 Grant Avenue LLC application was the only significant item on the agenda. A public hearing on the application will probably be scheduled.
Kingston’s school board passed a resolution of support for the project Wednesday, November 15. Ulster’s town board passed its resolution on Thursday, November 16. Expect the Ulster County Legislature, which generally follows the lead of the more local jurisdictions in approving projects that require a deviated Pilot, to pass its resolution in the very near future.
The project Pilot deserves to be extended. It shouldn’t be jeopardized by misleading and inaccurate job numbers. In the present atmosphere of suspicion toward Pilot job promises, such a misstep would pose unacceptable risks to the integrity of the IDA, which doesn’t right now need a reputational black eye.
The part of the application devoted to the economic impact of the 300 Grant Avenue LLC is a puzzle. The application form lists the number of present full-time equivalent (FTE) employees as 330 and the number of workers representing newly created FTE positions in the first year at the project site as 104, in the second year as 24, and the third year as 21. None are noted as relocated “from other project sites financed by obligations previously issued by the agency.”
The job numbers are wrong. This section of the application requires amendment. Though it appears there have been discussions about workforce increases taking place under the new ownership — from initiatives such as patients being housed in nearby independent housing situations and the taking on of more ventilator-dependent patients — the new application makes no reference to them other than the table of economic impact promising a rapid increase in employment.
The employee totals may well have been lifted from the original application 18 years ago. If so, the application signed by Steif on November 15 of this year needs to be amended prior to agency passage. An application that shifts without warning from the present time to 18-year-old job promises is misleading at best. It’s ironic that the Ulster IDA held a public meeting in the legislative chambers in Kingston to explain Pilot agreements on the same day as Steif signed his application.
The Northeast Center for Rehabilitation & Brain Injury has had a checkered history, with customer complaints, serious conflicts with regulators from the state Department of Health, and rogue employees. The great enthusiasm initially shown this innovative New York State facility for the rehabilitation of patients with serious brain injuries almost two decades ago has given way to a more mixed picture. But the Northeast Center remains an important source of employment and a significant — and unique — part of the healthcare industry.
The facility’s mission statement has always been positive, hopeful and aspirational. “Our constant objective is community reentry, and we are national leaders in assisting people to return to their homes and loved ones,” said the local healthcare facility’s website. “But the ultimate treatment goal for a Northeast Center resident-neighbor is so much more. Our entire staff is committed to a mastery of a style of living that maintains the gains made in therapy, promotes mental and physical health, and enables a positive, hopeful outlook that continues to grow throughout an individual’s lifetime.”
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