Town gives tax exemption to Bethel Woods

By CHARLIE BUTERBAUGH

BETHEL, NY — The Gerry Foundation will not be required to pay taxes on 450 acres of property at the Bethel Woods Center for the Arts in 2005.

Town of Bethel Assessor Marguerite Brown said she based her decision to exempt 11 arts center district properties from taxation because the center, a $63 million project, is poised to benefit Sullivan County considerably.

“In my mind I think something of this nature is entitled to be exempt because it is for every person’s benefit,” said Brown, the town’s assessor since 1980. “I think you have to look at this in that light.”

But while a large part of the Gerry Foundation’s tax burden has been cleared for this year, the Liberty, NY-based non-profit will pay a monetary sum equal to the yearly tax bill it has paid for the past 10 years.

Last year the 11 properties were worth about $70,000 in taxes, revenue that was shared by the town, county and three school districts that serve Bethel. Brown said the foundation would probably make a contribution to the different entities.

“It won’t be part of the town’s anticipated revenue,” she said. “We haven’t worked this out yet.”

Foundation Executive Director Jonathan Drapkin said, “The Gerry Foundation will voluntarily pay the current level of taxes on these properties to ensure the school districts, county and town receive the same money they are currently getting in order to provide services to their constituents. These payments are something we’ve done since acquiring the properties on the list 10 years ago.”

“That’s true,” Brown said. “They’ve always paid taxes.”

But in March, Brown significantly increased the assessed value of two of the 11 properties she ultimately decided to exempt. This was done to account for improvements of the land, including construction of the performing arts pavilion. In the end, the overall value of the properties jumped $799,100.

So the current value of the exempt properties, $2,474,590, would actually bring in $86,6100 in revenue if the land was still taxable.

Of the Town of Bethel’s total assessed property value ($480 million), about $42 million is tax-exempt. This makes up about eight percent of the town’s lands.

The foundation originally filed an application for the exemption of 13 properties, identifying itself as a charitable organization. Brown denied two of the parcels because the use of these “small buffer” properties would not qualify them for exemption, she said.

“We’re pleased that the assessor’s office confirms that most of the parcels will be tax exempt. That will help ensure our ability to continue investing in the performing arts center and the county to create jobs and business, cultural and educational opportunities,” Drapkin said.

On its 420-a application for exemption under Real Property Tax Law, the foundation identified its purpose: “To preserve the quality of life for the residents of Sullivan County and to attract visitors to the region and to promote the general welfare of the county and surrounding area.”

There are three primary tests applied when an entity is applying for tax exemption: purpose, use and non-profit status. The foundation had to document its formation as a non-profit on its application.

Brown said Bethel Woods, which is set to open in July 2006, does not fit the mold of other tax-exempt performing arts centers in the state.

“Most entities like this are located on an already existing tax-exempt parcel, like a community college and are automatically exempt based on law,” she said. “This is unique because they are a foundation.”

Brown added, “I can’t see how we can expect somebody to pour $60 million into the community and expect that person to foot the bill when we’re all going to benefit from it.”

She said the tax-exempt status would likely remain in future years, unless the use of the property changes.

“I don’t see that happening with Bethel Woods,” she said.