Mayor Stephanie Miner finds herself once again at the center of a dispute over tax breaks for a Bob Congel-related building project, this time in the form of a proposed 252-room hotel adjacent to the expanded Destiny USA mall. But in this case, there is little the mayor can do to prevent the tax deal from going through.
Wednesday, Feb. 12, Miner declared her opposition to further tax breaks for Destiny, insisting that the 30-year tax break granted to the developer included a promise of a hotel which has not been delivered.
“Eighteen months ago,” she told the Syracuse New Times in a Feb. 12 telephone interview after announcing her decision, “I was told that the project was complete. They didn’t build the amenities that they promised, including a hotel, but they were going to keep the PILOT (payment in lieu of taxes agreement).
This time, however, the mall developer is circumventing the city by requesting the breaks through the Onondaga County Industrial Development Agency. OCIDA is authorized to grant tax concessions anywhere in Onondaga County, including in the city of Syracuse, even if the mayor and the common council object.”
“OCIDA,” said the mayor, “has authority to give a break on city taxes.”
This represents the second time in as many months that the city and the mayor have been left on the sidelines while development projects requesting public spending have been floated. A proposal for a sports stadium near downtown became public in December, but Miner was added to the conversation only after the idea became public.
Is the city being deliberately left out of these projects?
“Recently, there has been a different approach from some people,” Miner said. “Rather than going to the city, some people are using a different approach. It doesn’t benefit the public if you don’t involve the city. It’s better if you come to the city first, because the city has to be part of the project regardless.”
Asked who she meant by “some people,” Miner deferred. “I’d rather not,” she said, when asked to fill in the blanks.
But she said, “No, that would not be inaccurate” when asked if it would be inaccurate to fill in the blanks with “the university, the governor, Destiny.”
County Executive Joanie Mahoney has said publicly that she will wait for more details before deciding whether to support a tax deal for the proposed Destiny hotel.
Why didn’t Miner adopt a wait-and see attitude? Destiny has yet to put numbers to its request, but according to Miner, the developers told her counsel that they would be looking for an 18-year tax break totaling $20 million.
“She made the statement,” Alexander Marion, who speaks for the mayor, said in a phone interview Friday, Feb. 14, “because she had done her homework and she felt there had been public discussion and that was the appropriate time to comment.”
Miner confirmed that she has had no direct contact with Destiny officials.
“Their attorney reached out to my special representative to say they wanted a 252-room hotel on the northeast corner lot, and they were looking for benefits similar to other hotels: 18 years, like the Marriott downtown,” Miner said. “We ran an analysis based on a property value of $75 million. They would get a $750,000 mortgage filing tax waiver, save $4.5 million in sales tax, which is common. With a PILOT, they would be paying $3.2 million in taxes, compared to $17.4 million without a PILOT. That comes to $19.4 million, and we rounded up to $20 million.
“Where the evidence shows benefit to the public, we will provide benefits to developers,” Miner continued. “We’ve had record levels of economic development year after year. Look at the Inner Harbor, the Pike Block, downtown Marriott. People were saying five years ago that downtown was dead.”
Would a Destiny hotel ultimately bring in enough sales tax to offset a property tax break? “Let’s see the numbers,” Miner said. “Let’s see data, not just assume that there will be a benefit. I said the same about the stadium: I’m not for it or against it, I want to see the data.”
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