The Suffolk County Industrial Development Agency approved a compromise on Thursday that allows a culinary school that reneged on payments from a previous PILOT agreement to pay 25 percent of taxes annually on its school building to the town and other pertaining districts.
The agency’s seven-member board voted 5-0 on a proposal from Suffolk County Community College's culinary school, Culinary Arts Riverhead LLC. The school will pay $36,828 per year as part of a new PILOT — or payments in lieu of taxes — deal on the building to the town, Suffolk County, the Riverhead School District and special districts such as sewer and water, among other districts that the school would have to make PILOT payments to.
The payments will be for the remainder of the building’s lease, which expires in December 2028.
The school will also pay $19,418 in real property taxes to the town and local special districts, bringing the school’s total annual tax payments to $56,246. That is 43.52 percent less than the $129,231 in full taxes it would have paid without the tax abatements, according to IDA figures.
“We’re paying more than we were, but less than we could have been,” Ben Zwirn, the college’s director of legislative affairs, said after the meeting.
However, Zwirn said the school would likely consider relocating due to the taxes they had to pay.
“I think the college will start looking sooner or later for an alternative down the road . . . but for the next 10 years, we’re here,” Zwirn said.
Under the school’s approved proposal, it will pay the town $11,502, or 20.4 percent, of the $36,828 in annual PILOT payments. Zwirn said the offer was a compromise after the school in October asked the IDA for a 10-year, 100 percent tax reduction for the cooking school.
Riverhead Town Board officials said in November that they opposed giving the school such tax reductions. Board members were also concerned about the culinary school owing the town $77,330 in PILOT payments and $24,004 in late fees, which the school had not paid since entering into the PILOT agreement with the IDA in 2006.
The board authorized a settlement in November between the town, the school district and the school that town officials said would cover nearly all payments and fees owed.
Though town attorney Robert Kozakiewicz said the town wanted a plan allowing the cooking school to open on summer weekends, IDA officials said Thursday that it was time to make a decision.
“How much discussion do you need? We’ve talked about this for 60 days,” IDA board member Kevin Harvey told Kozakiewicz. “You understand our frustration. This has to get resolved, and the parties involved should have resolved this issue.”
Riverhead Supervisor Laura Jens-Smith said Thursday that while the town would have preferred it if the school had agreed to its proposal, they were fine with the decision.