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Medley Centre loses tax deal
Irondequoit, N.Y. - The owner of Medley Centre, Bersin Properties, has been decertified as an Empire Zone designee, according to New York State Assembly Majority Leader Joseph Morelle.
The designation entitled Bersin Properties to nearly $4 million in property tax credits since 2004. Creating and maintaining at least two full-time jobs on site was a requirement of the deal. Morelle and others question whether that requirement was met.
Tuesday afternoon Bersin Properties owner Scott Congel fired back stating that employees were on site from 2007 to 2013 "before we were forced to temporarily mothball the project." He also took issue with the claim that $4 million in tax benefits were received and called that claim, "flatly false and misleading" in a statement issued to the media.
Assemblyman Morelle announced the Empire State Development Corporation (ESD) concluded Bersin Properties no longer qualified as a designee and decertified it as of June 6. Bersin Properties will have to appeal within thirty days and Congel said he would.
The decertification is the latest step in the ongoing struggle between local leaders and Bersin Properties over the proposed development of the Medley Centre. Morelle called for the investigation in February and the ESD agreed to look into the dealings at the Medley Centre. Morelle added, "In addition, ESD's actions open the door for the State Department of Tax and Finance (DTF) to review whether in previous years Bersin Properties has failed to comply with the agreed upon parameters of their Empire Zone designation. This could inevitably lead to the clawback of state tax dollars received by Bersin in previous years."
This move from the state comes as local governments are in the process of revoking Congel's local tax break deals with Monroe County, COMIDA, the Town of Irondequoit, and the East Irondequoit School District. The governments claim he owes about $4 million in "penalty payments" for failing to meet certain investment goals for development at the Medley Centre property. Congel responded by filing a lawsuit against all those entities in May.
In his statement issued on Tuesday, Scott Congel said Assemblyman Morelle and the local governments "are well aware that we had a lender stop funding in 2009, in violation of their loan agreement, during the worst financial crisis since the depression." Congel claims that blocks his ability to move his development project forward. He sued that bank in April.
Congel reiterated his claim that Bersin Properties made local governments a $6.4 million offer to settle all claims of unpaid penalties and agreed to escrow the first $1.7 million as a sign of good faith.
That offer previously came with a request to restructure the current local tax break deal (PILOT or Payment In Lieu Of Taxes) and the governments have unanimously rejected the offer.
Irondequoit Town Supervisor Adam Bello released a statement Tuesday morning: "I want to thank Majority Leader Joe Morelle for his leadership in protecting taxpayers, and holding Bersin Properties accountable for the promises they made to our community. Today's decertification of Bersin Properties from the Empire Zone Program, and the actions the town has taken to terminate the PILOT agreement, will ensure Irondequoit's taxpayers are no longer subsidizing a failed development. The former Irondequoit Mall has the potential to be the largest economic development project in our region. In order to make that a reality, we need to stop throwing good money after bad, and we need a developer who will act in good faith. Bersin Properties has 30 days to appeal to the ESD ruling."