1969 New York State passed legislation providing for the creation of industrial development agencies (IDAs) to facilitate economic development in specific localities throughout the State. Today there is an IDA in every county in New York State, and many towns, cities and villages also have IDAs.
The County of Sullivan IDA was proposed by Sullivan County in 1970 and authorized into existence by the State of New York later that same year. Like all industrial development agencies, the
County of Sullivan IDA works to promote, encourage, attract, and develop job and recreational opportunities and economically sound commerce and industry. We do this by providing financial incentives to eligible companies seeking to locate and expand here in Sullivan County.
The County of Sullivan IDA’s Uniform Tax Exempt Policy describes the requirements a company must meet in order to be eligible for IDA assistance. We have an array of programs targeting various industries including tourism, agriculture, manufacturing, and others.
A business seeking assistance must submit an application and cost-benefit analysis, which are reviewed by the IDA’s Board of Directors before approval.
The IDA can provide three types of tax incentives to approved projects.
- We can offer property tax relief from county, school, and town or village taxes resulting from an increase in assessed value due to new construction or expansion.
- We can also offer a sales tax exemption on purchases, leases, and rentals of materials, furniture, fixtures, equipment, and supplies to be used for the company’s construction or expansion project.
- Finally, we can exempt mortgage recording taxes in instances where a mortgage is required to finance the company’s project.
Real Property Tax Abatements
Real property tax abatements are perhaps the best-known form of IDA assistance. When a company undertakes new construction or expands its existing facility, the assessed value of the property increases, and the taxes go up.If the company is approved for an IDA real property tax abatement, the property is removed from the tax rolls, and the company and the IDA enter into a Payment in Lieu of Taxation (PILOT) agreement.
Under the PILOT agreement, the new tax obligation resulting from the
increased assessment is phased in over a specified number of years. The company makes annual PILOT payments to the IDA, and the IDA distributes one hundred percent of those payments to the county, school district, town, and village, if applicable.Importantly, the IDA does not abate the taxes on the pre-construction assessed value of the property. A company’s PILOT payment includes the value of pre-construction taxes, as well as a portion of the new taxes based on the post-construction assessed value.
The annual PILOT payments increase over time, so that near the end of the PILOT term the company’s payment approaches the amount of full taxes that would be due without IDA assistance. After the end of the PILOT term, the property is returned to the tax rolls and
the company pays full taxes.By providing tax incentives during the startup and expansion phase, the IDA helps companies to improve their cash flow during this critical time of growth.
During 2017 we administered 48 PILOT projects, collecting over $4,600,000 in PILOT payments and disbursing those monies to the County of Sullivan and its towns, villages, and school districts.
These 48 companies reported over 2,100 full-time equivalent employees during 2017.
Currently our largest and best-known projects include the Resorts World Catskills Casino and the Yo1 Wellness Center in the Town of Thompson.
But we also assist dozens of smaller firms including law offices, food manufacturers, craft beverage producers, and many others.
We continue to adapt in response to the county’s changing business climate, and in recent years we have added two new tax incentive programs: one targeting commercial solar electricity generating facilities, and one targeting the arts industry.
As the county’s economy continues to change and develop, we look forward to working with its increasingly diverse business community. For more information on the County of Sullivan IDA’s mission and work, please contact us at 845-295-2603.
By Jennifer Flad
Executive Director, County Of Sullivan Industrial Development Agency