By Alex Costello and Dana Williams
And the good news keeps coming. Nassau County recently announced that it will sell 18 of its brownfield properties, including a vacant gas station on Hempstead Avenue in West Hempstead. The developer SDRJ bid about $3 million for all of the brownfields.
Brownfields are vacant industrial properties that once hosted warehouses, gas stations, factories and the like. Most developers steer clear of them because they must be cleaned of any contaminants before they can be developed, a process that can be costly and time-consuming.
Brownfields are a headache for the county as well. They are difficult to sell, and the county can only hold a tax lien - the back taxes owed on a property - for 15 1/2 years, according to a statute of limitations on such liens.
"There's no interest in the properties," said Tom Maher of the Nassau County Department of Real Estate. "And because there's perceived contamination, whether it's actual or not you don't know until you do some investigation, but developers just shy away from these properties. That's the whole problem with brownfields."
The county can sell the tax lien on a brownfield to a developer, which pays the county what it is owed, takes ownership of the property and can then develop it as it pleases. Few developers want to take on brownfields liens, however, because they also face the expense of cleaning up the property.
But the county has devised a way to make its brownfields more attractive to developers. "We came up with this idea, which has never been done before, as far as we know, where we're selling the liens and assigning the deeds," said Sean Rainey, the county's deputy director of real estate.
The county's plan, put simply, is to give the deed to a brownfield to a developer when it makes a down payment on the lien, instead of after the lien is paid off. In addition, the developer can deduct the costs of cleaning the property from the balance it owes the county on the lien.
Rainey gave an example of a developer who bids $300,000 on a tax lien. The county accepts, and the developer makes a down payment of $50,000. The developer then cleans the property, which costs $100,000. In the end, all it owes the county is an additional $150,000.
"It adds an incentive for them so they don't feel like they're bearing all the liability for these expenses," Rainey said. "And we get the property cleaned, it goes back on the tax rolls, and everyone benefits."
Though SDRJ's bid did not approach the properties' cumulative assessed market value - about $5 million, according to Maher - it nearly equaled the total of all their county tax liens, $3.2 million. "So we're really getting a pretty good deal here," Rainey said. "We're getting, dollar for dollar, a good deal of our money back."
Depending on the state of the properties and the extent of their contamination, explained Scott Yanuck, one of the developers, cleaning could be completed in a year or so. At that point, some of the properties - although Yanuck wasn't able to specify which ones - could begin to be developed.
SDRJ is in talks to redevelop the vacant gas station on Hempstead Avenue into a retail center or housing. "What's going to happen with the brownfield properties is that the contamination will be eliminated and it will become viable again, which is very important," explained county Legislator Vincent Muscarella, who represents West Hempstead. "What will go there is still being decided, but what's important here is that steps are being taken to put a vacant piece of property in West Hempstead into good use."
Some civic leaders said that a retail or mom-and-pop business would be a suitable replacement for the gas station, since the property is in West Hempstead's business district. "It's a small piece of property, but some kind of retail or small business is a good idea," said Rosalie Norton, president of the West Hempstead Civic Association. "We don't want to see another vacant property or building in our community, so we will definitely work with the parties involved to see that the gas station is redeveloped into something that will improve and contribute to the area."
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