IDA OKs tax break for hotel, golf course

The Industrial Development Agency has accepted a revised cost estimate for a planned hotel and golf course renovation in the town of Rochester.

The Ulster County Industrial Development Agency has accepted a revised cost estimate of $17.27 million for a planned hotel and golf course renovation in the town of Rochester, which is expected to receive nearly $1.2 million in tax breaks.

The project, on the site of the former Rondout Golf Course, was discussed at an agency board meeting Wednesday. Officials said the project was previously expected to cost $20.17 million, but the golf course portion of the project was taken out of the calculations for tax benefits.

“The sales tax is where the ... only change was,” said Paul Hakim, a consultant for the developer. “We reduced the incentive ... from $480,000 to $422,000 as a result of taking the golf course improvements out.”

Developers had previously sought the larger sales tax waiver, but in June were told that work to clear an area of a former 18hole golf course should not have started until after agency approval had been given for the tax breaks.

The project is still expected to have a 9-hole course, but the application had to be revised.

Hakim said the $58,000 sales tax reduction is equivalent to the amount expected to be spent on improvements to the golf course.

“Although it’s approximately ($2.9 million) worth of work, very little of it is attributable and is sales taxable,” Hakim said. “Materials ... would be crushed stone, pipe, seed, fertilizer, those types of products. So we had that contractor go back and re-itemize all that.”

The IDA tax break comes with a 10-year agreement to pay $694,819 in property taxes, saving the developer $683,400 over the term of the agreement. The agreement will waive 100 percent of taxes on improvements for the first three years, then 75 percent in years four and five, and 50 percent the final five years.

Developers additionally will see $93,750 in mortgage taxes waived.

Inness NY LLC is seeking to reopen the former Rondout Golf Course, which closed in 2017, and add a 12-room hotel along with 28 cabins, a restaurant, spa and retail shops.

Agency board Chairman Randall Leverette said the developer could not use the tax breaks for any accessory buldings to the golf course.

“You usually have a club house for golfers to check into,” he said. “So the concern for me was to make sure that no benefit from this agency would be used to construct anything associated with operation of that golf course.”