The Babylon Industrial Development Agency is ending a tax break for an East Farmingdale company over failure to make payments.
The IDA entered into a 10-year payment in lieu of taxes, or PILOT, agreement with Orics Industries Inc. in 2008. The company, which produces food packaging machinery and equipment, relocated from College Point, Queens, to 240 Smith St., a 1.4-acre site with a 28,750-square-foot building.
According to the company’s application for assistance from the IDA, Orics was established in 1989 and was looking to expand the business, projecting to go from 48 employees to 102 employees within three years.
The abatement deal for the company started at 60 percent and increased by 4 percent each of the 10 years of the deal, said IDA special projects manager Brendan Murphy. This year would have been the last year of the tax abatement. According to the IDA, the company saved $181,795 over the nine years of the PILOT, and $33,930 in mortgage recording taxes.
The company missed the Oct. 31 deadline for payment and currently owes the agency $66,224 and Suffolk County $8,080.
Orics owner Ori Cohen said the failing economy in 2008 significantly impacted his business and workers from Brooklyn and Queens could not afford to relocate to Long Island so he was never able to reach his employee goals. He said he currently has 40 to 45 employees.
Cohen said the IDA refused to listen to his pleas for more time after some of his customers did not make payments.
“I owe them for 2018, granted, but the year is not over,” he said. “I’m here struggling and instead of helping me, they’re destroying me.”
Cohen said he’s considering moving his business out of state.
According to Murphy, Orics had a history of delayed payments and the IDA board voted in early 2015 to end the PILOT but payments were made and it was reinstated by the end of the year.
“At the IDA we understand the hardships that businesses can face, and we do our best to work through those issues,” IDA board chairman Justin Belkin said in a statement. “But at the end of the day, we have a fiduciary responsibility to the taxpayers that we are going to act on.”
The IDA has terminated eight other agreements with companies since 2014, three of which were for issues of nonpayment, Murphy said.