Developer looks for tax abatement for proposed Kelly Road hotel
By John Kennedy
VERNON — A developer is seeking a multi-year tax abatement on a hotel it wants to build on Kelly Road, town officials say.
The Economic Development Commission will review the application at its Oct. 10 meeting, which will be held at 7:30 a.m. in the town council chambers, EDC Coordinator Shaun Gately said.
Gately is recommending a seven-year tax abatement as an incentive for the developer to build in town. According to state statute, that is the maximum length for an abatement on this type of project.
If the EDC approves the application, it will go to Mayor George F. Apel, who will decide whether or not to recommend it to the Town Council. If it’s not approved, Gately said the developer, True Hospitality Group, LLC, will likely take the project to a competing town.
The developer wants to build a 70-room, 31,000 square foot hotel on three lots at 355, 359 and 361 Kelly Rd. The properties are located between Tri-City Plaza and the Free Spirit Café, and across the street from a Holiday Inn Express.
Gately said the proposed hotel would eventually result in an estimated $74,154 taxes per year to the town. The properties would increase about $3.15 million in appraised value and about $2.2 million in assessment value, Gately said.
Currently, the town receives $5,606 in taxes from the three parcels.
If the hotel is built, the town would collect that amount in the first year of completion as the proposed abatement calls for a 100 percent reduction on its new assessed value.
For the next two years, it will be taxed on 25 percent of the new value, bringing the town about $18,538 in additional taxes each year. In year four and five, the property would be taxed at 50 percent, and for the sixth and seventh year, 75 percent. In year eight, it will be taxed on its full assessment value.
“Even with the abatement in place, the town still stands to see a sizable tax increase that it would fail to realize if this addition wasn’t constructed or was constructed in another community,” Gately said.
The hotel will be of the Candlewood Suites brand, which is part of the Holiday Inn family.
The managing partner of True Hospitality Group is Victor Antico from Holiday Inn Express and Antico Enterprises, Gately said, and Deb Javit from Tri-City Plaza, LLC, is also involved in the project. Tri-City Plaza currently owns the property.
The estimated cost of the project is $7 million, with $6.4 million in improvement costs, Gately said, and will provide 25 permanent jobs, as well as 50 construction positions while the hotel is being built.
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