Study: Heartland Town Square to cost Islip $3.7M over 5 years

Islip Town taxpayers would be on the hook for nearly $3.7 million over the first five years of development of the proposed Heartland Town Square project, according to a study released Thursday.

The costs are associated with the town having to hire new employees and obtain equipment for the project.

Islip’s Industrial Development Agency commissioned the analysis by Camoin Associates of Saratoga Springs in February 2016 to examine the economic and fiscal impacts of the proposed development that would add millions of square feet of retail and office space and thousands of residential units to land on the Pilgrim State Psychiatric Center property in Brentwood.

Heartland Developer Jerry Wolkoff, who purchased the 450-acre plot from the state in 2002 for $20 million, has spent the past 15 years going before the Islip Planning Board with his proposals for the development between Commack Road and the Sagtikos Parkway. The planning board in August recommended a 133-acre section of the site for the first phase of construction, which would allow the town to monitor traffic and infrastructure impacts before considering future phases.

Wolkoff’s entire proposal for the mixed-use development includes 9,000 apartments, 3.2 million square feet of office space and 1 million square feet of retail built over 32 years. It requires a zone change from residential to a newly established Pilgrim State Planned Redevelopment District before construction can start. The Islip Town Board will decide whether to grant the zone change in a vote likely to take place later this spring.

In the first year of development, town expenses related to Heartland will exceed revenues by $907,855, according to data in the study presented at a public informational meeting at Islip Town Hall Thursday. In the second year, that figure jumps to $933,017 before it starts to drop off in the third year at $855,261; then $622,536 in the fourth and, finally, a loss of $374,542 in the fifth year. The figures begin to show a positive financial impact for the town in the sixth year at $50,150 and grow from there to a peak of about $8 million nearly three decades into the project.

“There’s generally a few years’ lag when you incur these costs during construction,” IDA Executive Director Bill Mannix said. “We won’t realize enough fees from permits that will be pulled and we won’t have the taxable assessed value in early stages to cover the costs of all the activity that’s going to occur.”

Over the expected length of time to complete the full project — currently broken into four phases — the town would net a total of nearly $112 million, according to the report.

“Over the long haul . . . that should result in tax relief for all Town of Islip property owners,” Mannix said.

An estimated 23 new town employees — in seven departments including public safety, fire marshals, and buildings and planning — would need to be hired for the full build-out of the project, Mannix said. Most, but not all, of those employees would need to be hired within the first years of development, he said. Other costs to the town include equipment and vehicles.

“This is something the town board has to consider,” Mannix said of the increased costs.

The study concluded that the project would create the equivalent of 23,899 construction jobs for a length of one year each and 18,018 permanent on-site jobs.

The Islip Town Board is to hold a public hearing April 26, Islip Town Supervisor Angie Carpenter said at Thursday’s meeting, where no public questions or comments were allowed. Residents wishing to ask questions or make comments before the hearing can do so through the town’s website through April 25.