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The Upstate Economy
Syracuse OK's 30-year tax break for university bookstore
Those for it say it has little resemblance to Destiny USA other than the length of the tax break. But those in opposition disagree strongly.
Months of debate about Syracuse's development strategy and negotiations culminated Monday with the city granting just its second-ever 30-year property tax exemption.
The recipient is a developer who will build a mixed-use off-campus bookstore and fitness center for Syracuse University. The property in question is a long sliver of land currently owned by the nonprofit university, so it's not taxable.
During a special session, the Common Council voted 5-4 to give developer Cameron Group a payment-in-lieu-of-taxes (PILOT) deal.
The deal is not so much an exemption, but a way to create some revenue off land that is currently not generating any, economic development advocated argued.
"We're talking about the creation of a new workable model for extracting taxes from otherwise untaxable property," said councilor Khalid Bey.
Councilor Kathleen Joy echoed those thoughts.
"With this type of a partnership between private institutions, the public, and private developers, we can harness that potential [and] get revenues that we can rely on year after year," she said.
Cameron Group will now construct and operate the complex for 30 years and pay 17 percent of the assessed property value, or about $64,000, each year. After the deal expires, the land will be transferred back to the university and go back off the tax rolls.
But some on the council still feel burned by the developer of the Destiny USA megamall, the other recipient of a 30-year tax break. The developer of that project failed to expand the mall as much as promised, but was able to keep the tax exemption through a loophole in its contract.
"We loved it so much the first time, we came back for more," said councilor Lance Denno.
The city shouldn't be exempting development projects on University Hill, the most economically viable part of the city, councilor Pat Hogan argued.
"It's a blatant giveaway," he said.
The language of the agreement was changed at the last minute to strengthen what councilors negotiated with the developer and university in order to win enough votes.
The city will audit Cameron Group in order to ensure they hire the promised 10 minority apprentices during construction. The university will also have to prove each year it is providing fitness programs for city youths, as it promised.
Politics and Government
Politics and Government