The state comptroller announced today that his office will audit the Hempstead Industrial Development Agency and District 30 in response to the controversy surrounding the Green Acres Mall tax breaks.
“The Green Acres project has drawn noticeable criticism in the community,” said DiNapoli. “Several local elected officials, including State Sen. Todd Kaminsky, Assemblywoman Michaelle Solages, Nassau County Comptroller George Maragos and Valley Stream Mayor Edwin Fare, have brought the concerns of their constituents to the attention of my office. As a result, our auditors determined there were sufficient questions about the project that warranted a closer examination.”
DiNapoli said letters were sent this week to the Hempstead IDA executive director and board of directors, and the Valley Stream superintendent and school board outlining the scope of the audits and when they will begin. There is no timeline for the completion of the audits.
The District 30 audit will focus on budgeting practices and the resulting property tax levy in relation to the property payments in lieu of taxes the IDA granted the mall in 2015, which went into effect in October.
The review of the Hempstead IDA will center on compliance with policies and procedures related to approval of the Green Acres Mall project.
The Hempstead IDA approved the 15-year tax break in 2015 to foster economic growth in tandem with the mall’s expansion. For the duration of the PILOT agreement, the mall is removed from the county’s tax rolls, effectively reducing the assessed valuation of property in School District 30 — the metric by which the Central High School District is required by law to determine how much it collects from each of its elementary districts.
The break shrunk the mall’s tax payments by about $6.5 million per year for 10 to 15 years, beginning in October, and shift the financial burden across the various classes of taxable properties in Valley Stream. On average, property tax bills increased between $322 and $758 in school districts 13, 24 and 30.
District 30 was criticized in an economic study commissioned by the IDA in November for underestimating its share of the $14 million PILOT, and thus levying more in property taxes than needed. Superintendent Nicholas Stirling previously said that, once received, any excess money would be applied to lowering next year’s tax levy. He said the district has not yet received the excess money.
“As with past routine audits, the district will fully comply throughout the process and will provide all necessary documentation to audit officials,” said District 30 Superintendent Nicholas Stirling. “The district takes the formation of its annual budget very seriously and works diligently to balance the instructional and programming needs of students while maintaining fiscal responsibility to taxpayers.”
Fred Parola, executive director of the Hempstead IDA, said he welcomed the audit.
“We are delighted — thrilled!” he said. “We already have everything ready for them. We’ve already had a conversation. All good.”
Sen. Todd Kaminsky and Assemblywoman Michaelle Solages applauded the announcement of the audit. They held a joint news conference in October calling for the comptroller to intervene — as did Fare at Village Hall in November.
“The lack of transparency around this agreement has caused unprecedented controversy and public outrage, and getting to the bottom of it should be our top priority,” Kaminsky said in a news release.
“The Town of Hempstead Industrial Development Agency’s minimal communications with the public was unacceptable,” Solages said. “The communities affected by this egregious tax increase deserve transparency and accountability.”