High taxes on new builds are stigmatizing Tuckahoe and deterring potential buyers, according to a handful of developers and real estate agents who voiced their concerns to the Southampton Town Board on January 8.
“You’re putting a burden on the people in Tuckahoe,” said Peter Calogrias, a Tuckahoe resident and local builder for 45 years. “We’re being taxed roughly 50 percent higher than other areas in the town. Between the high taxes and reassessment every two years, it’s very aggressive, and making homes less appealing to buyers. The board needs to think about the future.”
Douglas Elliman real estate agent Laura Nigro said homes being assessed at very high rates is only part of the problem, citing the 7.14 percent school tax. According to Nigro, taxes run roughly $29-30,000 on a half-acre property. To help solve the problem, she proposed amortization.
“Most of the people who buy these homes are second-home buyers who don’t have children going to school,” she said. “We can say they pay 2.16 percent Southampton Town rate and amortize the Tuckahoe rate to bring it up to the district rate over the next 10 years so that more houses and more people would be added to our rolls. And then maybe in that 10 years, our overall tax rate could come down a little bit with more people buying into the area.”
She and others felt having some sort of incentive for buyers of new construction is essential when there’s higher school taxes, especially because they’re seeing most potential purchasers deciding to forgo buying in Tuckahoe to live in other areas of the town where the rates are much lower.
Builder Frank DeVito said he’s lost two prospective buyers in the last few months because of taxes. He said he was charged $66,000 on a vacant piece of land, which was eventually grieved down to $39,000, and charged $88,000 on another.
“With 400 kids in the school, how do you get away with charging taxes like that?” he asked the board. “There’s tons of Community Preservation Fund-purchased parcels, places for parkland, golf courses . . . and everyone else is making up the difference for all the land taken off the tax roll. Lower taxes would bring in more business — taxes and work comes in — and will bring in more revenue.”
Tuckahoe’s total tax base, or market value, is $2.63 billion, compared to Southampton’s over $26 billion.
“Many districts east are subsidized by the second homeowners,” Councilman Tommy John Schiavoni said. “What you say makes a lot of sense to me, I agree with you, and I’m happy you’re here.”
Supervisor Jay Schneiderman said while there are some good ideas to explore, the idea of phasing in would have to be approved by the state, and difficult to do.
“I think we should continue to look at this,” Schneiderman said. “I understand it may be discouraging buyers, but the school isn’t losing out on taxes.”
Many developers cited hundreds of workers hired and millions of dollars spent to put up these homes, which broadens the tax base, and said being the largest local industry needs to be taken into consideration when coming up with a potential solution.
“Put the land aside for a second and save the people, save the culture, save the workers, save the students,” Calogrias said. “You’re losing quality people and you’re losing longtime residents — I’ve spoken to many people that aren’t planning on staying because their taxes are doubling every couple of years. Take a look at this situation just down the block and address it in any way you can.”