IDA defends move that cleared path for tax deal

The agency has taken heat for changing a key policy just before approving a relief package for The Kingstonian.

KINGSTON, N.Y. » Members of the Ulster County Industrial Development Agency defended to county lawmakers their decision to change a key policy that allowed the agency board to approve millions of dollars in tax breaks for the proposed mixed-use development known as The Kingstonian.

At a meeting Tuesday of the county Legislature’s Economic Development, Tourism, Planning, Housing and Transit Committee, agency officials portrayed the change as little more than a routine move, though Rose Woodworth, the agency’s chief executive officer, conceded to lawmakers that the optics of the move weren’t the best.

In August, the IDA adopted a policy allowing it to consider granting tax breaks to housing projects, clearing the way for The Kingstonian to be given a payment-in-lieu-of-taxes, or PILOT, deal. That policy, however required that all affected taxing jurisdictions — in this case Ulster County, the city of Kingston and the Kingston school district — sign off on the payment-in-lieu-oftaxes agreement.

The county and city governments supported the PILOT deal for The Kingstonian, but the Kingston school board did not. But in January, moments before voting 6-1 to approve more than $26 million in tax breaks for The Kingstonian, the IDA board altered its policy to state the agency needed to get input from all the taxing authorities, but not their approval.

Joseph Scott, the IDA board’s attorney, said the change was made to put the agency’s housing policy in line with the Uniform Tax Exemption Policy.

Scott said the change was made just prior to the board’s approval of the PILOT deal for The Kingstonian project because the board typically adopts policy changes at its January meeting. The housing policy change “was just one of those matters that was addressed and approved at that meeting,” he said.

“We did go back and forth about putting them in the same meeting because we understood the optics,” Woodworth said. But in the end, she said, the board decided to take up both because “it didn’t really make sense to penalize an applicant because of our mistake.”

Some members of the legislative committee, though, said the move called into question the credibility of the agency.

“I think you have to understand the timing of the change raises huge questions ... and all the hard work you have done, [it] puts all of that into question,” said Legislator Lynn Archer, D-Accord.

“The timing of this, along with the decision on The Kingstonian, is somewhat suspect,” she said.

“This has been a reset on the trust with the public,” said Legislator Abe Uchitelle, a Democrat who represents the area of Kingston where The Kingstonian is to be built. “I have a really hard time looking my constituents in the eye and explaining to them how consistency, logic and rationality are the underpinning of this decision.”

Industrial Development Agency Chairman James Malcolm conceded the optics were poor, but he denied the board’s actions should be viewed as suspect.

“Things don’t look good, but sometimes things are not going to look good,” he said. “I stand behind each and every decision this board has made.”

Malcolm also said the IDA will do “everything we can” to regain the trust of county lawmakers.