The Hempstead Town Board appointed five new members Tuesday to the town’s Industrial Development Agency, a day after the agency’s longtime members resigned after controversy over tax breaks granted to the Green Acres Mall in Valley Stream.
The IDA board has been criticized for its decision to grant the tax breaks, which taxpayers and politicians say caused tax hikes of up to 12.2 percent for village residents. But a report commissioned by the IDA and released Monday found that several factors may have led to the increases, including the school districts’ budgeting practices.
Hempstead Town Supervisor Anthony Santino said last month he intended to ask the Town Board to vote to remove the IDA board, but on Monday, six of the seven IDA board members quit instead.
Santino and five Town Board members voted to appoint to the IDA board four lawyers: Arthur Nastre, who will serve as chairman of the board, acting Nassau County Chief Deputy Clerk John Ferretti Jr., Lynbrook Mayor William Hendrick and Mineola attorney Steven Raiser; a pastor, Freeport Rev. Dr. Eric Mallette; and a small businessman and previous IDA board member, Florestano Girardi.
Ferretti declined to comment, while the others could not be reached for comment on Tuesday.
All of them are registered Republicans, as is the majority of the Town Board.
Girardi served on the previous IDA board and did not resign on Monday. He was not on the board in 2014 when the deal was made.
The IDA is a state-chartered, independent agency whose unpaid members grant tax incentives to entice businesses and developers to work in Hempstead Town. The Town Board cannot mandate that the new IDA board change the tax breaks.
The agency had come under fire after Valley Stream residents last month saw school tax increases of 4.6 percent to 12.2 percent — hikes they attributed to the mall’s tax breaks.
The IDA gave tax incentives to Macerich, the California-based owner of Green Acres, for the mall’s $79 million expansion and the construction of Green Acres Commons, a shopping area which is adjacent to the mall.
The incentives included a sales tax exemption and a payment-in-lieu-of-taxes, or PILOT, for each project. The PILOT payments are less than what the mall would be paying in property taxes. Macerich is challenging the mall’s tax assessments in court.
Michael Deery, a town spokesman, said the Town Board will add one more person to the IDA board, but he didn’t know when. Deery said Santino picked people who were “well-qualified.”
“The supervisor had discussions with staff and members of the business community and government,” Deery said. “These were names of folks brought to his attention and he developed a group of people best suited to the task.”
Brian McMahon, executive director of the New York State Economic Development Council, a trade group representing IDAs across the state, said his group recommends that IDA members have experience in commercial real estate, financial services, labor and sometimes politics.
McMahon said the previous board’s exodus could mean losing decades of experience.
“The Hempstead IDA board has served with distinction for a long period of time and carries a lot of knowledge of IDA financing,” McMahon said. “It’s not a simplistic endeavor and takes a good understanding of economic development [the new board will] be working to achieve for a significant period of time.”
Santino and five Town Board members voted to appoint the new members, though Senior Councilwoman Dorothy Goosby, the board’s only Democrat, abstained.
Goosby said she only received the new members’ names on the day of the vote and was not given enough time to review their backgrounds.
“We need to know that these people are there for us,” she said.
The vote came after more than an hour of public comment, during which residents expressed their opposition to the mall’s tax breaks, called for officials to overturn the deal and demanded IDA executive director Fred Parola’s resignation.
Parola, who is appointed by the IDA board and cannot be removed by the Town Board, said on Tuesday he expected to remain on staff.
Parola said the IDA did nothing wrong, and said the school districts miscalculated their budgets, which may have contributed to the tax hike.
“You replace the board, it’s never enough. You can cut everyone’s head off and people are reacting to the numbers they have to pay in their taxes,” he said. But the school districts maintain they were never told their portion of the PILOT they would receive, leading them to underbudget by nearly $3 million.
The new appointments will become official after they are filed with the New York secretary of state’s office, which town officials said should occur in the next few days.
Meanwhile, on Wednesday, the town and IDA must answer subpoenas from the Nassau County comptroller’s office for its audit into the tax breaks.
But in a strongly worded letter dated Monday, the IDA’s attorney, John Ryan, wrote the county comptroller has no jurisdiction to audit the IDA, and called the subpoenas an “abuse of process, waste of governmental resources and intentional interference with contractual rights.”
With James T. Madore
The new Hempstead Town Industrial Development Agency Board
IDA Chairman Arthur Nastre, 69, of North Bellmore, attorney and ex-counsel to Hempstead Town Board of Appeals
Steven Marc Raiser, 45, of Merrick, criminal-defense attorney
John R. Ferretti Jr., 33, of Levittown, attorney and Acting Chief Deputy Nassau County Clerk
William J. Hendrick, 63, of Lynbrook, Lynbrook mayor and attorney
Rev. Dr. Eric C. Mallette, 54, of Freeport, pastor at Greater Second Baptist Church of Freeport and former executive assistant to the Hempstead Town Board
Florestano Girardi, 59, of Syosset, owns dry cleaners and a laundromat and is the only remaining member from previous IDA board