Jefferson County legislators were the first to approve a $1.5 million property tax abatement agreement for COR Development Co.s 296-unit Beaver Meadow Apartments on Tuesday afternoon.
The payment-in-lieu-of-taxes agreement will start with Jefferson County and the Watertown City School District receiving 17 percent of what the projects full taxation would be and, in the final year, receiving 84 percent of the projects full taxation. Over the 10-year term, the jurisdictions will get half of what the full taxes would have been.
It was a deal that was full of compromises, Legislator Scott A. Gray, R-Watertown, said. Thats how the system works. Thats how negotiations work. Would I have liked something better? Absolutely. Did we maintain our exposure in terms of dollars? Absolutely. At the end of the day, we are where we need to be and we maintained our exposure.
But COR, Fayetteville, actually will pay only a flat 10 percent of the full taxation amount, or $29,640. The rest of the PILOT payments will come from an escrow account using the developers repayment of a Community Rental Housing Program loan. COR will repay the $3 million loan from the program at 3 percent over the first 10 years, then drop to 1 percent. That money will go to an escrow account, which will fulfill the PILOT distribution requirements, to the tune of $1,185,866, over the 10 years. The Jefferson County Industrial Development Agency will contribute an additional $296,400 over 10 years to the escrow account as part of the payments, part of its $2 million contribution to housing development.
To alleviate concerns from the school district on upfront costs of busing and added students, the PILOT is weighted so that the district receives all of the PILOT payments in the first few years, but has smaller increases, so that the county catches up to what its 41 percent share would be over 10 years. The district, in total, will receive $873,955.82 while the county will receive $608,330.18.
At the end of the PILOT, at current rates, COR would pay $296,457.20 in school and county taxes. COR will continue to repay the program loan at $150,000 per year for the remaining 20 years of the loan, with a balloon payment of about $295,000 in the final year. Instead of 3 percent interest that the program loan was originally promised, the loan will be repaid at 1 percent over the full term.
The town of Watertown, which has no property taxes, will give the district $150,000 directly in addition to the PILOT payments.
We did that to offset the initial cost for the school district, Supervisor Joel R. Bartlett said. Its been a long process, its been a tedious process, but overall, we were able to reach an agreement amenable to the developer, town, county and, hopefully, the school district.
The county board approved it on a 15-0 vote after some discussion Tuesday afternoon.
I sincerely believe we couldve gotten here a lot quicker, Legislator Barry M. Ormsby, R-Belleville, said. This couldve been simplified if it werent for the commitments and agreements made a couple of months ahead of the involved agencies getting discussions.
Legislator Steven T. Harter, R-Watertown, also voiced some reservations.
Im not totally impressed with this legislation, he said. With my experience, this is the sort of thing that I would be afraid is going to come back and bite me.
Mr. Gray encouraged others to vote for the resolution and congratulated those who worked on the issue.
It is important to our area to continue to provide adequate housing for the people out there, and not just the military, he said.
The Watertown Town Council will consider the PILOT at 3 p.m. Thursday. The school district had a tentative meeting at 5 p.m. Tuesday.
Given the importance of this, I wanted to make sure everyone was there and everyone was counted, Board of Education President Michael R. Flick said. We did our best to be responsible for the taxpayers of the district and get the best deal we could on their behalf.