Glen Cove tax breaks a complex, opaque IDA tale
A property on Glen Street in Glen Cove, seen in January, where a developer won tax breaks to build a 29-unit apartment complex. Credit: Newsday / John Paraskevas
The saga of a 29-unit Glen Cove apartment complex's efforts to obtain tax breaks illustrates the complexities surrounding the region's industrial development agencies.
Developer Alec Ornstein sought for more than a decade to build housing on the Glen Street site of a vacant auto body shop. Over time, he reduced the building's size until the Glen Cove City Council, in 2024, approved his plan, which includes four affordable units.
Last year, the city's Industrial Development Agency, chaired by Mayor Pamela Panzenbeck, declined to approve Ornstein's request for a 15-year abatement of property taxes, which would allow him to pay a smaller amount instead. So, Ornstein turned to the Nassau County IDA.
To move the project forward, Nassau IDA officials told the editorial board, the county IDA collaborated with the Glen Cove IDA. The solution: Nassau would provide the property tax break, while Glen Cove would provide the sales tax exemption.
Panzenbeck, who last year said the development wasn't "worthy" of a payment in lieu of taxes, declined to comment in a Newsday news story about whether the deal was coordinated.
Behind the messy situation is a convoluted maze of agencies responsible for encouraging regional economic development by defraying taxes. IDAs provide discounted or delayed property, sales or mortgage recording taxes for developers and businesses who promise to create jobs, add housing or expand their facilities and services. The agencies use the so-called "but for" test, giving breaks when jobs or housing wouldn't be created "but for" the IDA's help.
That process often fails, partly because the IDAs lack sufficient state guidelines and standards for how to divvy out such packages, and the terms they should include. What's more, all businesses and developers claim they'll leave or won't build without breaks. While some are necessary, IDAs are inclined to say yes to all comers. The result is often less revenue for government, which at times individual taxpayers must make up.
Eight Long Island industrial development agencies cover both counties, five towns and one city. The unnecessary overlaps and inconsistencies make little sense. And having so many agencies encourages "IDA shopping."
The Glen Cove application reveals an opaque process with little disclosure and not enough input from taxpayers. Nassau and Glen Cove IDA officials didn't have to sign any documents about their joint efforts, leaving no paper trail. There's no statewide or regionwide searchable database showing every developer and their applications. Even once you find Ornstein's application, listed under an LLC, you must scroll through 60 pages to find the details of the break he sought.
Tax breaks play an important role in allowing Long Island to grow, and especially in adding the housing we need, including truly affordable units. But the region's IDA structure needs an overhaul. Consolidation, which would require state legislation, may help.
Until then, IDAs must communicate — with each other and with taxpayers. The goal: a searchable statewide dashboard with details on finances and whether promises are kept.
Ornstein's development will move forward, with approved tax breaks. But it's Long Island taxpayers who really deserve the break.
MEMBERS OF THE EDITORIAL BOARD are experienced journalists who offer reasoned opinions, based on facts, to encourage informed debate about the issues facing our community.
