Southold Town board members are looking to breathe some life into the local economy by offering expanding businesses tax exemptions for up to 10 years.
On Wednesday, the board hosted a public hearing on the proposed Industrial/Commercial Incentive Plan, which would make local business eligible for tax breaks if they are making more $50,000 worth of construction, alteration, installation or other improvements to its facility.
While no one spoke during the hearing, town officials believe the plan would draw new industry to pre-existing buildings in Southold such as the vacant Capital One Building in Mattituck, Supervisor Scott Russell said.
More than two years after Capital One Bank announced it was closing the doors of its Mattituck operations center, the Main Road building is still on the market. Local officials have been dealing with the daunting task of trying to find new tenants for the commercial space. Mr. Russell has since floated the idea of a long-term pediatric care facility for the property. He said the town board is currently working with county officials to find a new occupant, but admits that may not happen anytime soon.
While the Capital One building is one of the town’s most visible vacant properties, it’s a town-wide problem, Mr. Russell said.
“We’ve had buildings that have gone unused for years,” Mr. Russell said after the hearing. “This will allow someone to go in and invest in that property. We hope this will get existing businesses not only to invest in themselves, but get new businesses to invest in existing inventory.”
The amount of the exemption would be based on a percentage calculated by taking the increase in the assessed value of such property after construction. The incentives would be offered on a declining scale during a ten-year period – starting with a 50 percent tax exemption during the first three years and dropping incrementally to a 5 percent tax exemption by year 10. School districts, according to the text of the proposed legislation, would have the authority to not apply the exemptions, should they so choose.
The supervisor said that the value of the exemption is justified by the need to provide employment opportunities and broaden the town’s tax base.
“What Southold lacks more than anything is meaningful employment. We’re trying to change that trend,” Mr. Russell said. “Affordable housing is a challenge, but you can put in all the affordable housing you want and if people don’t have a place to work, we’re going to have a hard time keeping people here and the local economy thriving.”
The draft law is inspired by Suffolk County’s Industrial Commercial Incentive Board, which falls under the purview of the county’s Economic Development and Workforce Housing Department. The board has been working with municipalities to create a Strategic Industries Property Tax Abatement Plan, which includes the town’s proposal.
Board members hope to vote on the proposal during their next regular meeting on Nov. 19 at 4:30 p.m. in the Southold Town Meeting Hall.