Almost a year ago, in March 2023, The Spark of Hudson announced an affordable housing initiative called HudsonDots. Today, there are twelve properties in the HudsonDots program--six previously owned by Phil Gellert and six additional properties. The renovation of six of the properties has been completed, and another is in progress.
At the Common Council meeting last Tuesday, a resolution was presented, for the first time, authorizing Mayor Kamal Johnson to enter into a regulatory agreement with HudsonDots based on New York State Real Property Tax Law Section 581-A. Section 581-A allows the assessed valuation of real property used for residential rental purposes, where at least 20 percent of the units are occupied by tenants "who qualify in accordance with an income test," to be based on net operating income rather than the market value of the property. Section 581-a typically applies to multi-unit apartment buildings, but HudsonDots is asking that it be applied to a group of seven separate properties: 341 State Street, 14 and 16 Jenkins Parkway, 526 and 528 Prospect Street, 308 Columbia Street, and 520 Columbia Street.
According to the agreement being proposed by HudsonDots, the rents for 50 percent of the units in these seven buildings will be limited to what is affordable for households with incomes that are up to 80 percent of the AMI (area median income). In exchange for this, the property taxes on these seven houses would be based on net operating income instead of market value. The agreement, as proposed, would continue for five years.
The deadline for entering into the agreement is March 1, and the resolution authorizing it came before the Council for the first time on February 20. During the discussion at Tuesday's meeting, it was mentioned the HudsonDots had been working on this for close to a year. It was also mentioned the information about the proposed agreement had been provided earlier to city assessor Cheryl Kaszluga and Council president Tom DePietro, but the full Council did not receive the resolution until Friday, February 16. At Tuesday's meeting, it was decided there would be a special meeting this Wednesday, February 28, at 6:00 p.m., to consider the resolution. The meeting is a hybrid, taking place in person at the Central Fire Station, 77 North Seventh Street, and on Microsoft Teams. Click here to find the link to join the meeting remotely.
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The Spark of Hudson is an interesting organization: it gives money away then asks the City to force the property owners and their tenants to pay for their "philanthropy." Is there a name for this particular type of private taxation?
ReplyDeleteThe Spark and their affiliate, Dots, are beyond interesting. They, and their names, are suspicious. Their websites remind me of Galvan's, full of platitudes, feel good words and questionable claims and pictures - "Look at us and all the wonderful things we do for "the Hudson community."
DeleteAs far as I can tell, all they have given us so far is never ending construction at 502 Union and the Big Towel Spa, with two $25 an hour saunas on Oakdale Beach. Where they post a NO SWIMMING sign but customers of theirs can regular be seen in the lake, just beyond the NO SWIMMING sign and in violation of one of Oakdale's well posted rules: Swimming is PROHIBITED when no lifeguard is on duty. They seem to play by a different set of rules on at least a few levels.
In the wake of my comment above, I heard from someone I know who is reliable and in a position to have information on the subject. According to this person, the Dot houses have often been used to house workers on a farm the Spark of Hudson either owns or has an interest in. I'd love to learn the truth of this matter: are the "philanthropists" asking the residents of Hudson to subsidize the Spark's businesses? The farm is in Hillsdale. The housing is in Hudson. So the community with the county's highest property tax burden is being asked to subsidize a business in a community with among the highest property values in the county? And the underlying business is a not-for-profit (and so pays no property taxes anywhere)? If this is indeed the case -- which I'd hope some alderman or woman might think to ask about before the City dumps an even larger tax burden on its residents -- I'm sure many of us would like to know.
ReplyDeleteSection 581-a of the NYS Real Property Tax Law was meant to encourage the development and rehabilitation of multi-family properties. HudsonDot is asking to have the City reduce the assessed values on five (5) single family residences and two (2) two-family residences. What's especially curious is that HudsonDots doesn't own any of the properties for which they are seeking this tax advantage. There are a lot of questions that should be asked at the special meeting.
ReplyDeleteJust pay your fair share of taxes.
ReplyDeleteI might be revealing my own ignorance here, but I'm genuinely asking— if the intention is to maximize the number of residential units within the city that are "affordable" (here defined as "up to 80 percent of the AMI"), why not extend the benefits of Section 581-a to any property owner that rents out units? I personally rent in a building with three residential units in it, so could one of those units be rented for an amount based on 80% of the AMI and my landlord then have this property assessed at their net operating income? Is the concern that if everyone did this, that it would decimate the amount of property taxes that the city collects?
ReplyDeleteIt's a state law, not a local (City) law. The City, like almost all municipalities in NYS, has no taxing authority except that granted by the state. The concept of "net operating income" only applies to commercial properties -- so is essentially nonsensical in the owner-occupied single-family housing context.
DeleteOh, so if I'm understanding correctly, any privately held commercial property (i.e. a building with a commercial unit, like a retail shop and ALSO some number of residential units OR a fully residential property with four or more units in it) can ALREADY enjoy the benefits of Section 581-a, but in this instance, HudsonDots is essentially 'bundling' a bunch of non-commercial properties and asking for the Section 581-a tax benefits to apply to them in aggregate?
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