Peconic preservation fund nets whopping $66.84M in 2012
The Peconic Bay Community Preservation Fund -- a land preservation fund that gets its money through a special tax on real estate sales and transfers in each of the East End towns -- had one of its best years in 2012, raising $66.84 million, a 13.6 percent increase over 2011.
The tax money raised in each of the five towns reached levels not seen since the overinflated real estate boom of 2004-07. But state Assemb. Fred Thiele Jr. (I-Sag Harbor) cautioned it could be a one-time increase, fueled by the desire of wealthy property owners to avoid a 2013 increase in the capital gains tax.
Thiele, who wrote the legislation to create the fund in 1990, predicted there would be a drop-off in high-end real estate closings in January because of the rush to close on real estate sales in December. The fund collects 2 percent from each real estate transaction.
There is an exemption for first-time home buyers -- each town sets its own limit -- so at least the first $150,000 is not taxed. The figure is $250,000 in East Hampton, Southampton and Shelter Island.
The money raised by the fund can be used only to acquire and manage open space properties in each of the towns. So far, the fund has raised $789.3 million, with well over half the money -- $457.52 million -- being raised in Southampton, the largest of the East End towns.
East Hampton's revenue from the fund grew from $13.86 million in 2011 to $21.86 million in 2012, a 57.7 percent increase. Shelter Island's fund revenue grew from $820,000 to $1.3 million over the same period, an increase of 58.5 percent.
Southampton's revenue actually dropped from $38.33 million to $37.82 million, while Riverhead's increased from $1.93 million to $2.21 million and Southold's went up to $3.65 million, from $3.35 million.
The tax, which does not increase the general tax rate, is popular on the East End. In 2006, residents in each town voted to extend the tax, which was to have ended in 2020, to 2030.