The hotel proposed to be built at the Old Huntington Town Hall got final approval Thursday for an additional $1.2 million in property-tax savings.
The six-member board of the Suffolk County Industrial Development Agency gave a unanimous nod for 15 years of tax incentives for the Hampton Inn & Suites.
In February, the IDA granted preliminary approval for a package of tax breaks but then the coronavirus pandemic hit and developer Huntington Village Hotel Partners LLC requested more help.
Under the deal approved Thursday, the property-tax savings for the 80-room hotel increases to $2.3 million over 15 years. That equals 48% off its property taxes over the period instead of 33% under the previous deal.
About half of the savings, $610,000, will come from a change in the property’s assessment. The other half will be derived from significantly smaller payments-in-lieu-of-taxes, or PILOT payments, in the first five years of the IDA tax deal, records show.
Developer George Tsunis told the IDA board last month that he needs more aid because “there is zero new hotel-construction financing available today. The [hotel] industry has been more decimated than any other industry due to COVID.”
He said there’s still a vibrant market for a hotel in downtown Huntington that serves business travelers and tourists.
Besides the property-tax reduction, the IDA granted a sales-tax exemption of up to $825,814 on the purchase of construction materials and up to $90,881 off the mortgage recording tax.
IDA executive director Anthony J. Catapano said after Thursday’s virtual board meeting, “Updated studies of the project were done and determined additional assistance was warranted. The historic 1910 former town hall building has been sitting dormant for at least a decade. It is time for the building’s rebirth.”
No one from the public spoke during the meeting. But during last week’s public hearing, two town residents questioned why the $24 million hotel merits IDA help.
Karen Steinhaus of East Northport said the 14 jobs expected to be created by the hotel come with an average salary of $39,700 per year. “The employees won’t be able to afford the rent on an apartment in the town,” she said.