The taxpayers of Long Beach should understand how a proposed tax break to the Superblock beachfront apartment complex will affect their wallets.
Two 15-floor towers are planned, with 522 luxury apartments and 11,000 square feet of retail space. Developers AvalonBay and partner iStar Financial have asked for big breaks on property and sales taxes. In return they say they'll spend around $300 million and create 2,250 construction jobs and 450 permanent ones. The developers say they can't do the project without the breaks, but . . . everyone says that.
Taxes on the land are about $500,000. The developers' proposal would increase that payment by just 1.66 percent a year for 15 years, basically treating the property as if it remained an empty lot. Taxes would rise much faster for the final 10 years of the deal. It's estimated that by the final year of the abatement, the assessed taxes would be about $9 million but the owners would pay $5 million. The developers note if they can't build the project, the opportunity for higher tax revenue from the parcel will be lost.CartoonMatt Davies' latest cartoon: Bill and Donald's bindersCommentSubmit your letterReader essaysGet published in Newsday
When a business gets breaks from the local Industrial Development Agency, it doesn't cost the school district or municipality revenue. Their total taxes collected stay the same. The losers are other taxpayers, who could see their tax rates and bills go down if a new business or development kicked into the pot rather than get a big abatement.
The six-acre Superblock site has been plagued with troubles for decades. This project would bring people, money and bustle to the community. That might be a good trade-off. City officials support the deal. But taxpayers might wonder when they'll get a break from footing all the bills.