Kingston ceding lot called vital to project
KINGSTON, N.Y. » If the city does not agree to transfer ownership of an Uptown property currently used for municipal parking, the proposed mixed-use development known as The Kingstonian will not be able to move forward and generate public benefits for Kingston, supporters of the project told members of the Common Council.
Critics of the move, though, questioned the legality of transferring the property at 21 North Front St. to the Kingston Local Development Corp., arguing the proposed benefits from the development were not worth giving up a city asset.
The Common Council’s Finance and Audit Committee heard from more than two dozen speakers during an online public hearing Thursday evening regarding a proposal to transfer the property to the development corporation, which would turn it over to the developers of The Kingstonian. Part of The Kingstonian would occupy the site.
Nearly half of the speakers supported giving the city-owned land to the development corporation, while some, including members of that group, questioned the process.
“The transfer of the parking lot parcel in question is a threshold issue for this project,” said Daniel Ahouse, a representative of the developers. “Without the property transfer, the project simply could
not exist.”
Ahouse said the council understood that when a request seeking potential developers for the property was issued, and the city Planning Board understood that when it ruled the project would have no significant environmental impact.
Additionally, Ahouse said, transferring a property to a local development corporation is common and legal. He pointed to Ulster County recently transferring property on Golden Hill in Kingston to its local development corporation for an affordable housing project.
Ahouse also said an attorney for an “out-oftown businessman” who owns properties Uptown has made arguments that the transfer is illegal. He said that’s been a constant theme throughout The Kingstonian’s approval process — the businessman’s attorneys show up and offer opinions about state and local laws and ordinances with no legal basis.
Ahouse said the developers, Kingstonian Development LLC and Herzog Supply Co., submitted a letter to the council refuting the assertions made about the property transfer. He said the action enjoys “broad support” from the public, with more than 100 people submitting written comments asking the council to approve the property transfer.
The Kingstonian, estimated to cost $58 million, would straddle Fair Street Extension between North Front Street and Schwenk Drive and would comprise 143 residential units, including 14 considered “affordable”; 8,900 square feet of commercial space; a 32-room boutique hotel; and a 420-space parking garage, with 277 spaces available to the public, according to the developers. Part of the project is proposed to be built on the property at 21 North Front St.
Pat Courtney Strong, a member of the Kingston Local Development Corp., said she is not a supporter of The Kingstonian.
“At a time when so many are experiencing a housing crisis, I think this is the wrong time for public dollars to go toward luxury housing,” Strong said.
She also said she had questions regarding the process for the council to transfer the property to the local development corporation, such as whether there were any precedents for doing so other than Ulster County’s recent action.
Strong also said Kingston Mayor Steve Noble referred to the parcel at 21 North Front St. as a “burden” to the city, and she asked whether the council felt it met that criteria.
Miles Crittien, another member of the Kingston Local Development Corp., expressed his concern about the public’s lack of understanding about the transfer process, which he attributed to the lack of transparency from the city. He also asked what rules and regulations the city would have to follow to dispose of property if it were not transferring it to the development corporation.
Michael Murphy, a former director of the Kingston Local Development Corp., said the parcel at 21 North Front St. needs to be developed in the next few years or Uptown Kingston will suffer an economic decline.
Murphy said local development corporations are formed for many reasons, including for the transfer of property for economic benefits, such as that being proposed.
“I’ve seen many projects proposed in the city, and this is, by far, the best one I’ve seen in a long time,” Murphy said of The Kingstonian.
Patrick Logan, who spoke on behalf of several owners of properties in proximity to the North Front Street parcel, said they did not believe the proposed conveyance to the Kingston Local Development Corp. was permissible because the city can only sell or convey a property that is not needed for a public purpose. Logan said the parcel is needed for public parking, and that need will only be frustrated if The Kingstonian is built.
Logan added that city officials and Kingston’s own request for proposals to develop the property all pointed to a need for parking to be included in any project there.
The municipal parking lot currently has 144 spaces; The Kingstonian proposes to construct 420 spaces in a garage on the site, Logan said. He said that appears to be a significant gain, “but this gain is an illusion.”
He said the residents and other occupants of The Kingstonian would use up 285 parking spaces, leaving the public with less than the current amount.
Logan said if the city gives the property away, it effectively would be forfeiting an asset worth more than $1 million in exchange for a reduced number of public parking spaces.
“Moreover, the city will be doing so in order to benefit a developer that is already on the receiving end of tens of millions of dollars in aid in the form of grants and PILOTs (payments-in-lieu-of-taxes deals),” Logan said.
The developers initially asked the Ulster County Industrial Development Agency for a $28.2 million reduction in property taxes over 25 years, a $1.4 million waiver from local sales and use taxes, and a $325,000 exemption from mortgage recording taxes. But in a PILOT agreement brokered by the agency, the property tax savings for The Kingstonian were reduced to $26.15 million. Changes also were made that could reduce the savings based on revenues that exceed the developer’s expectations.
The agreement maintains the sales and use taxes and mortgage recording tax waivers.