December 9, 2000
To the Editor:
Judging from testimony given at the hearing held by the Syracuse Common Council this past week, feelings run exceedingly high both for and against the granting of a 30-year tax exemption to subsidize the proposed Pyramid Mall expansion.
It is of overriding urgency that each member of the Common Council cast his or her vote, not based upon what is best for the developer, labor unions or other special interests, but rather in furtherance of the long term economic and environmental health of the City. Syracuse's financial plight is well known. Its real estate tax base has been decimated by the high percentage of properties within its borders that are already off the tax rolls.
In five years, the existing Pyramid building complex, which is assessed at 324 million dollars, is scheduled to come onto the City's tax rolls, bringing in over 10 million dollars in annual tax revenue, of which some 6 million will fall into the City treasury and 4.5 million will go to the County. Pyramid claims it is prepared to go to Court to protest this assessment but the appraisal it generated when it put the Mall on the market for sale belies this contention. The City should not relinquish its right to 6 million dollars a year unless it is absolutely certain it will receive enough additional sales tax revenue from the enlarged Mall to compensate for the loss of 30 years of real estate tax forgiveness.
Proponents of Mall expansion point to the understanding arrived at by Mayor Bernardi and County Executive Pirro, whereby the City will receive 30 percent and the County 70 percent of additional sales tax revenues attributable to the enlarged portion of the Mall. This allocation, were it to be finalized, would greatly enhance the City's financial position when compared with the sales tax formula set by the County legislature in June of this year.
But the devil is in the details. Assuming the County legislature is prepared to ratify the proposed 30/70 split of new sales tax revenues, because of provisions in the New York State Municipal Law, this arrangement can only be of five year duration, from 2002 to 2007. City officials are said to "hope" the County will agree to extend this distribution formula for another five years until 2012. But as of now the City has no assurance the County will agree to a 30/70 split for even the five-year period discussed by the Mayor and County Executive. Were the County legislature to approve five years but no more, the City would suffer greatly. The City will have waived its right to collect real estate taxes and its revenue will, at the conclusion of the five years, be limited to the harsh County sales tax allocation formula protested by the Mayor and community leaders earlier this year. Under such a turn of events, Syracuse would be in far worse predicament than if the expanded Mall had never been built and the City had chosen to insist on its right to collect real estate taxes on and after the year 2005.
It seems very clear that no member of the Common Council should vote to abandon 30 years of assured real property tax dollars in exchange for an illusory five year sales tax fix.
Very truly yours,
Vincent A. O'Neil