Jehovah's Witnesses take tax exemption in Fishkill

Poughkeepsie Journal/May 12, 2015

By Craig Wolf

Fishkill -- The Jehovah's Witnesses have obtained a partial tax exemption for the Rivercrest luxury apartments that the religious group bought last year, and have now purchased an adjacent waterfront property, both in the Town of Fishkill.

The effect on taxpayers is a shift of the burden for the lost taxes to all other taxpaying shoulders, plus a probable increase in that shift next year. The loss so far to the town is about $55,000, with other sums snipped from the tax bases of the Beacon City School District, the Chelsea Fire District and Dutchess County.

And, it likely means that Jehovah's Witnesses will come forward with plans for how they'd like to develop the land that they acquired March 13.

The two properties sit next to each other in the Brockway section of the town, overlooking the Hudson River and west of Route 9D.

Rivercrest apartments is a 250-unit luxury rental complex that the town's assessor values at $31 million. The two waterfront parcels are 57.4 acres of land and empty industrial buildings that are valued at $1 million each that were bought from Chelsea Waterfront Development LLC.

Town Supervisor Bob LaColla said the Witnesses have a vision for the old industrial land. "They called to say they're still planning on coming in with a plan for the old Circle M site." That's the long-gone company that operated a wood-treatment plant there.

No comment was forthcoming from the Witnesses headquarters. The group's property dealings are under the name of Watchtower Bible & Tract Society of New York, Inc. LaColla said the group's representatives have spoken of building an assembly hall, a video production studio and three office buildings there.

Calculations based on the deed indicate a likely sale price of $6 million

Chelsea Waterfront Development was set up by AVR Realty, headed by Allan V. Rose, who signed the sale deed for Chelsea Waterfront. AVR bought extensive properties in the area and has been building it up or selling portions.

In December, Watchtower bought the 250-unit Rivercrest apartments. Tenants told the Poughkeepsie Journal that the new owner would not renew rental leases, leading to a surge of relocations. LaColla said the Witnesses then began moving their own members into units that were vacated.

By March 1, the date by which an owner must apply for exemptions, the society claimed a religious exemption for 44 percent of the property. LaColla explained that this was the proportion of units that had been reoccupied by members of Jehovah's Witnesses.

"They moved members into the units," he said. "Their model is along the lines of a monastery. They take a vow of poverty and are in full service to the church."

The complex, however, is hardly monastic. It has been one of the more deluxe rentals in southern Dutchess and has rented at some of the highest rates. Despite the assessment, the Watchtower apparently paid $57 million for it, based on calculations from the transfer tax on the deed.

The remainder of Rivercrest units are or were still under lease to non-members who had made their homes there when it was a standard, market-rate apartment complex.

LaColla said the town's assessor, Christian Harkins, has no choice in the matter, given the state laws that allow tax exemption for properties that are used for religious purposes and are owned by a qualified religious organization.

"He complies with state regulations on that," he said. The town, he said, is not quite standing still and officials are concerned. "We are promoting a conversation with our state representatives to look at state policy regarding tax-exempt properties, the exemption policy itself," LaColla said.

The exact amount of impact exemptions would have on taxes can't yet be calculated, LaColla said. A clearer picture should emerge after June 1. An official of the Beacon schools has previously said that a full exemption on the apartments could remove $800,000 in revenue from that source. But when that happens, the loss is made up by shifting it to all other taxpayers

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