Friday, December 01, 2006
Settlement gives tax exemption for Ichud Satmar Bungalow Colony, Grocery Store
They gave away the store, says Sullivan County Treasurer Ira Cohen.
A 6,000-square-foot grocery store at a bungalow colony, to be exact.
Local governments settled in February with Ichud Foundation, a Satmar Hasidic group that owns the former Ideal Bungalow Colony on Route 42 near Monticello High School. Ichud filed to make the colony tax exempt in 2004.
The settlement gave Ichud that tax exemption, as well as approval for the grocery store.
In exchange, Ichud will pay the Town of Thompson, Sullivan County and Monticello School District a total of $20,000 per year. That's down from $74,000 a year.
Cohen says the agreement is "not only outrageous but improper overreaching, unfair to the rest of the community in Sullivan County."
"How can you have a tax-exempt grocery store?" he says. "This is a perfect example of the extreme extent to which the law is being abused."
As treasurer, Cohen has so far refused to cancel Ichud's 2006 tax lien. He hopes to work with Ichud in coming up with a new settlement.
"He's 100 percent wrong," said Moshe Katlowitz, lawyer for Ichud. "It's that simple. It's a contract. It's an agreement. It's a court-ordered settlement."
Ichud had significant leverage because courts have broadly interpreted state law on exemptions. Officials of the town, school district and county say they had no choice but to settle with the foundation.
"We were basically told they were going to get (exempt status)," says Thompson Supervisor Tony Cellini. "We never win any of these cases."
The town also signed a side agreement with Ichud that doesn't involve the school district and county. It will give Thompson another $20,000 per year for approving the tax-exempt grocery store, raising the town's annual revenue from Ichud to $25,000. When Ichud was paying taxes, the Town of Thompson was getting $15,000 a year.
"I think I did a hell of a job," Cellini said. "The town made out much better."
Cellini, though, agrees with Cohen and other local officials that the state's tax-exemption laws need to be revisited.
"Municipalities are too vulnerable to this kind of litigation," Cohen says. "This law needs to be changed, and it needs to be changed badly."
Who gains
• Ichud Foundation Inc.: Property taxes drop from $74,000 per year to a $20,000 annual payment in lieu of taxes
• Town of Thompson: Tax revenue climbs from $9,000 to $25,000 per year (if a side agreement that grants the town an extra $20,000 per year is considered)
Who loses
• Monticello School District: Tax revenue drops from $44,000 to $10,000 per year
• Sullivan County: Tax revenue drops from $15,000 to $5,000 per year
• Thompson Planning Board: Loses much of its power to nix grocery store
• Thompson tax assessor: Loses power to deny tax exempt status of bungalow colony and grocery store
http://www.recordonline.com/apps/pbcs.dll/article?AID=/20061201/NEWS/612010329
They gave away the store, says Sullivan County Treasurer Ira Cohen.
A 6,000-square-foot grocery store at a bungalow colony, to be exact.
Local governments settled in February with Ichud Foundation, a Satmar Hasidic group that owns the former Ideal Bungalow Colony on Route 42 near Monticello High School. Ichud filed to make the colony tax exempt in 2004.
The settlement gave Ichud that tax exemption, as well as approval for the grocery store.
In exchange, Ichud will pay the Town of Thompson, Sullivan County and Monticello School District a total of $20,000 per year. That's down from $74,000 a year.
Cohen says the agreement is "not only outrageous but improper overreaching, unfair to the rest of the community in Sullivan County."
"How can you have a tax-exempt grocery store?" he says. "This is a perfect example of the extreme extent to which the law is being abused."
As treasurer, Cohen has so far refused to cancel Ichud's 2006 tax lien. He hopes to work with Ichud in coming up with a new settlement.
"He's 100 percent wrong," said Moshe Katlowitz, lawyer for Ichud. "It's that simple. It's a contract. It's an agreement. It's a court-ordered settlement."
Ichud had significant leverage because courts have broadly interpreted state law on exemptions. Officials of the town, school district and county say they had no choice but to settle with the foundation.
"We were basically told they were going to get (exempt status)," says Thompson Supervisor Tony Cellini. "We never win any of these cases."
The town also signed a side agreement with Ichud that doesn't involve the school district and county. It will give Thompson another $20,000 per year for approving the tax-exempt grocery store, raising the town's annual revenue from Ichud to $25,000. When Ichud was paying taxes, the Town of Thompson was getting $15,000 a year.
"I think I did a hell of a job," Cellini said. "The town made out much better."
Cellini, though, agrees with Cohen and other local officials that the state's tax-exemption laws need to be revisited.
"Municipalities are too vulnerable to this kind of litigation," Cohen says. "This law needs to be changed, and it needs to be changed badly."
Who gains
• Ichud Foundation Inc.: Property taxes drop from $74,000 per year to a $20,000 annual payment in lieu of taxes
• Town of Thompson: Tax revenue climbs from $9,000 to $25,000 per year (if a side agreement that grants the town an extra $20,000 per year is considered)
Who loses
• Monticello School District: Tax revenue drops from $44,000 to $10,000 per year
• Sullivan County: Tax revenue drops from $15,000 to $5,000 per year
• Thompson Planning Board: Loses much of its power to nix grocery store
• Thompson tax assessor: Loses power to deny tax exempt status of bungalow colony and grocery store
http://www.recordonline.com/apps/pbcs.dll/article?AID=/20061201/NEWS/612010329
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