Nassau's Industrial Development Agency Tuesday unanimously granted developer Bruce Ratner nearly $4.5 million in tax breaks to renovate the Nassau Coliseum, but questions remain about the use of union labor for the entire development.
Ratner, who plans to begin renovating the arena next month, will receive $3.37 million in sales-tax exemptions to pay for equipment, construction materials and furnishings and a $1.1 million reduction in mortgage recording taxes. The IDA's board -- Timothy Williams, John Coumatos, Gary Weiss and Christopher Fusco -- voted 4-0; the fifth member, Michael Rodin, who was not there, said in a statement he supported the breaks.
Ratner also will receive an exemption from property taxes during his 34-year lease with the county, although the arena is already tax exempt because it is owned by Nassau and used primarily for public purposes.VideoResidents upset over tax breaks for Coliseum developerColumnBrown: Big questions for Nassau Coliseum renovation
"We are pleased to have moved through the next step in the development process and look forward to getting to work on the project Long Island deserves," Ratner spokeswoman Ashley Cotton said.
Nassau County Executive Edward Mangano added that "we are one step closer to transforming the Nassau Veterans Memorial Coliseum into a world-class arena for residents' enjoyment for generations to come."
Ratner wrote in his application that he would not continue with the $261 million project without the IDA's assistance.
Ratner already has spent $13.2 million on predevelopment work, according to the application.
Nassau IDA Executive Director Joseph Kearney called the project "a significant economic event" that will generate "net positive economic activity" for the county.
While the IDA application does not cover a planned 388,000-square-foot retail and entertainment complex set to be built in two phases beginning in October, agency officials expect Ratner to seek additional assistance for that work.
The IDA application indicates that sales-tax exemptions for the retail and entertainment complex would total $7.39 million, and $1.4 million in additional mortgage tax relief.
At a public hearing last week, Uniondale civic leaders said the tax breaks should be withheld until Ratner agrees to make $10 million in improvements to the community.
Ratner, the executive chairman of Forest City Ratner Cos. in Brooklyn, declined to fund any off-site projects.
Forest City's lease with Nassau requires Ratner to make annual payments to the county totaling at least $195 million.
At last week's hearing, labor officials called on the IDA to reject Ratner's application, citing the developer's insistence that union workers take a 20 percent salary reduction.
Ratner has pledged to use union labor on the project and has been negotiating a project labor agreement, which details the conditions of a collective bargaining pact between the developer and the unions.
Ratner's lease with the county stipulates that the arena work is subject to the PLA but not parts of the retail complex. A source familiar with the negotiations said Ratner agreed to sign a PLA for all phases of the project if labor unions reduce their price on the entire development by 20 percent.
James Lester, senior vice president of commercial and residential development for Forest City Ratner Cos., told the IDA board Tuesday, "We are confident we can come to a resolution. We are very close."
But Richard O'Kane, president of the Nassau-Suffolk Building and Construction Trades Council, disagreed, and in a heated discussion with Lester after the meeting said Forest City had "gone back on your word" to use all union labor.
"We are nowhere near being done," O'Kane said of the negotiations in an interview. "We are not compromising on our wages."
The arena is set to close for renovations after Tuesday's Billy Joel concert. It would reopen in December 2016.