Riverhead officials decided against pursuing a lawsuit against the Suffolk County Industrial Development Agency related to a Main Street culinary school that had owed thousands of dollars in tax abatement payments.
The Riverhead Town Board voted 3-2 at its meeting Tuesday to not authorize any lawsuit. The suit would have sought to overturn the IDA’s Jan. 24 decision to amend and extend a PILOT agreement with Suffolk County Community College's culinary school, Culinary Arts Riverhead LLC.
Under the new IDA agreement, the culinary school will pay the town, the Riverhead School District and special districts annual payment in lieu of taxes — known as PILOT — that would allow it to remain in the building on Main Street. Town board members earlier opposed granting the culinary school tax abatements because the school previously owed the town $77,330 in PILOT payments and $24,004 in late fees dating to 2006. In November, the board authorized a settlement among the town, the school district and the culinary school that would cover nearly all payments and fees owed.
Riverhead Councilwoman Jodi Giglio proposed taking legal action at the board’s May 2 work session. Giglio said part of the reason a lawsuit was necessary was she felt it was a conflict of interest for the Suffolk IDA to give a tax abatement to the school.
She said the town attorney's office said the lease agreement between Suffolk County and property owner Ron Parr stated the county would pay the property taxes for the building.
Another reason, Giglio said, was that she felt yearslong tax breaks for businesses “should not become a habitual practice unless there are improvements and more jobs are going to be created, and there’s going to be a positive economic impact on our community here in Riverhead.”
Riverhead Councilman Tim Hubbard, who voted in favor of the lawsuit, said he thought town officials needed a plan that allowed the Riverhead’s own IDA to handle such situations.
“When we have our own IDA for the town, we should use our own IDA for the town," Hubbard said.
Suffolk IDA officials declined to comment.
Riverhead Councilman Jim Wooten , who voted against pursuing the lawsuit, calling it a “heavy-handed” measure and noted that the school had made efforts to come into compliance with outstanding PILOT payments.
Town Supervisor Laura Jens-Smith also voted against suing the IDA, saying the January agreement was “in good faith” and the board should invite the culinary school to a work session to discuss if it would keep the school open on weekends, a measure she said would help improve the downtown area.