The Bethlehem Industrial Development Agency has opted to restructure its tax abatement policy after receiving pushback over tax breaks given to retail businesses.
IDA President Frank Venezia presented the new abatement overview to Town Board members on Wednesday, Oct. 10. The new structure is meant to be easier to understand and eliminated an abatement level that was rarely used.
The new policy has eliminated the use of tiers. New businesses applying for abatements can now apply for “standard” or “enhanced” policies. However, they can also still apply for a special abatement that is tailored to their specific needs. The standard abatement matches what a business could receive for a project happening within the town that does not go through the IDA, but was applied for through the Planning Board.
“Whether you like or don’t like abatements, we only want to give them when they are necessary to stimulate additional development, but under existing law this (standard) abatement would apply to any new commercial building or substantial renovation,” said Supervisor John Clarkson.
To qualify for the enhanced abatement the project must meet certain criteria, like reuse of an abandoned lot, extensive job creation or a promotion of economic diversity. Venezia said promoting diversity is one of the most important aspects of considering abatements because like with the Vista Technology Campus, sometimes a project needs to begin to attract other businesses. The IDA has been criticized by some for granting a tax abatement to the ShopRite grocery store there. The store will not have to pay any property taxes for two years and then will pay reduced taxes for another decade.
“We needed to kick it off somehow and this was the way we thought was the best way to kick it off, by giving an incentive to a retail organization who was willing to build in that park,” said Venezia. “Hopefully it is the catalyst for investment and more of the type of high-tech businesses we are looking for who will be long-term taxpayers for the town.”
Councilman Jeffrey Kuhn questioned how having a supermarket at Vista would attract a high-tech business.
Venezia said during IDA discussions with developers, it is important if high quality services are nearby for employee use.
“Was a supermarket the right idea? I don’t know, but we looked at it as, is this the right business to kick this project off?” he said. “We didn’t have many other options. There weren’t many other applicants that were banging on the door to locate here.”
Kuhn asked what kind of information the IDA looks at in making a decision. Venezia said IDA members use their individual backgrounds, look at other projects and hold discussions with developers. Eventually, the decisions are made based on the opinions of IDA members.
“Is it perfect science? Absolutely not,” said Venezia, adding that those with opinions on the matter should attend public hearings so members can hear feedback from the community. Venezia said the IDA is going for a “long-term approach” to development.
Kuhn later asked if additional retail businesses wishing to open within Vista would receive abatements since they are no longer needed as a force to jump start Vista. He said he is concerned because there is resistance to abatements and some already established businesses feel it is unfair.
Venezia said it would depend on what the applicant brings to the table and how compelling their case is.
“We’re hearing those complaints too,” sad Venezia.
