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Officials: Hempstead withheld $7.6M over 'unsettled issues' with county

Hempstead Town Hall.

Hempstead Town Hall. Credit: Newsday / Alejandra Villa

The Hempstead Town comptroller “withheld” about $7.6 million collected by the town Industrial Development Agency and owed to Nassau County because of “unsettled issues between the County and the Town,” Hempstead spokesman Mike Fricchione said Thursday.

Fricchione declined to say what those issues were, only that they were “financial issues regarding each municipality's obligations to pay for certain items.”

“Over the last few months, those issues have been resolved and therefore we are in process of releasing the PILOT payments before the end of this week,” he said.

Town board spokeswoman Susie Trenkle-Pokalsky said the withheld money was related to litigation between the town and county that has since been resolved. 

County representatives did not immediately respond to requests for comment.

The town’s statement came a day after the IDA announced that the town comptroller had not disbursed “millions of dollars” of property tax abatement payments called PILOTs – or payments in lieu of taxes – owed to the county.

The withheld payments were noted in a July 25 draft of the Nassau County comptroller’s audit of the IDA, according to the IDA’s Wednesday news release.

A spokesman for the county comptroller criticized the IDA Wednesday for discussing the audit in draft form.

On Thursday, Jeffrey R. Schoen, chief counsel to the county comptroller, sent a letter to IDA counsel John E. Ryan regarding “possible ethics violations” by the IDA in “revealing confidential information contained in a draft audit report via a news release.”

“It is troubling to the Nassau Comptroller’s Office, that the Town of Hempstead IDA’s public news release referenced these confidential preliminary findings as the basis for assigning blame to another entity, cutting short of Office’s independent confidential review.”

IDA executive director and CEO Fred Parola said Thursday: “We didn’t comment on the county comptroller's audit at all.”

“Our sole statement dealt with the fact that we learned after this audit started, and then confirmed by the town, that the town withheld general tax payments” from the county, he said.

Fricchione said the PILOT payments in question were from 2017 and early 2018.

The IDA grants the property tax abatements to local businesses to promote economic development. Recipients make the PILOT payments, which often are smaller than the property tax bills would be, to the town IDA, which sends them to the town comptroller to disburse to taxing jurisdictions such as the town, county and school district, an IDA spokesman said.

With Candice Ferrette

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