By BETHANY BUMP
SCHENECTADY COUNTY — Local governments in Schenectady County received $14.83 million in revenue last year from property owners who don’t pay taxes but have agreed to payments in lieu of taxes agreements instead.
The figure was up 4.6 percent from the year before, when 48 PILOT agreements generated $14.18 million in revenue. There were 53 PILOT agreements in place last year. The increase was smaller this year than last (revenue increased a hearty 53 percent from 2012 to 2013) because one of three sizeable agreements on General Electric’s Niskayuna property expired.
Locally, PILOTs are typically set to last 10 or 15 years, with payments increasing over the term. Once they expire, the property is placed on the assessment rolls and the owner pays the full taxes that result.
“These are good, solid revenue generators for the community,” said Ray Gillen, chairman of the Schenectady County Metroplex Development Authority, which administers the agreements. “Most of these projects were built at vacant sites that paid nothing or paid little, so we’re getting substantial new revenue.”
Critics are slow to cheer PILOT agreements. They’re often awarded to big developers known to have deep pockets, leaving many observers to wonder how much a property might have generated if the owner had to pay full taxes like anyone else. But in economic development, particularly in upstate New York communities seeking revitalization, the competition to land big projects is fierce. One of the ways to transform blighted, long-vacant sites that could very well go on standing vacant is to offer site-seeking developers an incentive in the form of temporary tax relief, Gillen said.
Read Reporter Bethany Bump’s full story at The Daily Gazette.