During the time that the Agency holds title to or leasehold interest in the real property of a qualified project, that property is exempt from all real property taxes. However, IDAs require companies to make payments in lieu of taxes through a PILOT Agreement. The PILOT Agreement is made between the company and the IDA for the benefit of affected taxing jurisdictions (County, Town, Village, School District) where the project is located. PILOT payments usually consist of an agreed upon percentage of the improvements tax that would otherwise be due on the property if the project had been completed without Agency involvement.

Orange County IDA has adopted an aggressive PILOT (Payment In Lieu of Taxes) program aimed at the best of the best projects which will position the County to be most competitive in attracting business development. This innovative approach, will double the tax benefits of the New York State Standard 485-b program. The Agency’s program is a graduated schedule of abatement applicable to county, town, village and school district taxes. The schedule will result in increasing percentages of taxes due with a maximum initial abatement of one-hundred percent (100%) and annual increases of ten percent (10%) This is in addition to the other tax breaks on manufacturing equipment, bank loans and tax exempt bonds. The company will still be responsible for land and special district taxes.

See PILOT sample 10 year aging

Alternatively, a 485-b tax abatement is available from most municipalities and School Districts on the tax to be paid on improvements to the land or an existing building. 50% reduction in local taxes in Year 1, 45% reduction in Year 2, and so on until Year 11 when 100% of the taxes are paid by the company.

See 485-b sample 10 year aging