Resolution 16-160 entering into a CRA agreement with Hudson 21 LLC. The exemption is for 50% of the assessed value of the project for 15 years.
I voted “no” on this abatement, as I feel this deal hurts our school system in terms of lost revenue, lost opportunity and unnecessarily complicates the working relationship between the City of Hudson and the Hudson City School District.
The Community Reinvestment Area (CRA) Program is a direct incentive tax exemption program benefiting property owners constructing new buildings. This program permits municipalities or counties to designate areas where investment has been discouraged as a CRA to encourage the development of new structures.
City Councils are entrusted to make a judgment call on CRAs of this size and scope without an affirmative vote from the affected school boards. School systems receive most of the money from property taxes, so in essence we are voting as to whether or not to give away a portion of their future revenue. It is not a call we should make lightly, and not be given out to every developer as an opening bargaining position.
The size of this development, the type of development and the jobs created do not warrant this type of sacrifice from the schools. The projected payroll in the first year is less than $400,000, with 30 jobs. This is less than $14k a job. The square footage is 21,000 square feet of office and mixed use recreational and educational. Read about the development here.
I feel a CRA should be a tool reserved for signature projects. We should be weighing the benefits to our tax base, and to the community. We should consider the risk and reward if we turn down the abatement as to whether the project would still go forward. I don’t feel the City did any of these things, which is I voted no.
The initial vote for emergency legislation failed 4-2 for lack of a supermajority. (Councilman Hanink joined me in voting “no,” Councilman Weinstein was absent). It was only through some extra rounds of voting, with the “emergency” clause removed, that the vote passed by simple majority of 4-2. This means 30 days must pass before the legislation takes effect, rather than immediately.
I am in favor of competition, but only when the terms are fair. The principal tenant of this development is Goldfish Swim School. At an earlier Council meeting, Council heard from the owners of Life Center Plus, informing us of their new relationship with the Hudson Schools HCER swim program, and fact that this new swim school would be a direct competitor. They did not feel it was appropriate as a taxpaying business that a competitor be given a tax break. The developer has previously publicly stated he passes the tax breaks on to his tenants.
Not only will the Schools will be losing potential revenue that does not need to be abated, it will be helping underwrite a competitor to its own educational programming.