Dan Hust | Democrat
THIS IS THE religious learning center at the Ichud Bungalow Colony in Monticello. County Attorney Ira Cohen fought to have the original 2006 tax-exempt agreement amongst the colony, township, the county and Monticello School District changed.
Ichud Court Wrangle Finally Over
By Dan Hust
MONTICELLO December 18, 2007 The way Sullivan County Treasurer Ira Cohen describes it, the Ichud Bungalow Colony in Monticello was about to walk away with a precedent-setting deal.
Represented by New York City attorney Moshe Katlowitz, the 100-acre, 200-unit Hasidic bungalow colony had challenged the Town of Thompson’s 2005 decision to deny it tax-exempt status based on religious activities.
An agreement was crafted in 2006 amongst the colony, the township, the county and the Monticello Central School District that, according to Cohen, gave Ichud not only tax-exempt status in perpetuity but permission to build a grocery store on those tax-exempt premises, worth about $75,000 in taxes a year.
“The settlement was abhorrent,” he related.
Not really, said Thompson Town Attorney Michael Mednick, who explained that the original agreement simply didn’t address those items as clearly as a newly approved replacement.
“I think the differences [between the agreements] are more subtle than they are significant,” Mednick said, stating that Ichud would have had no choice but to reapply for the tax exemption each year and would have lost that designation if it had changed its use of the property.
Still, he said, “I think [the new settlement] is written better than it was before.”
No doubt about it, according to Cohen.
“We now have a rewritten, amended stipulation that in my opinion remedies all of the errors contained in the first one,” Cohen explained.
Just like in the February 2006 original, this month’s version of the settlement was approved by all parties.
How? According to Cohen, only because he refused to comply with the original court order.
Unlike Mednick (and the county and school, whose attorneys also signed off on the ’06 agreement), Cohen saw “a very bad precedent,” saying the stipulation did in fact grant an automatic renewal of the tax exemption every year and required the Thompson Planning Board to approve the construction of a grocery store on-site.
“They let the property owner’s lawyer prepare this,” he recalled.
(Katlowitz, County Attorney Sam Yasgur and MCS Superintendent Pat Michel could not be reached at press time.)
At first, there was little Cohen could do. He had been elected Treasurer after the settlement had been signed by all parties (though before Sullivan County Supreme Court Judge Robert Sackett had made it official).
In June, the court order arrived in his office. Cohen’s refusal to comply with Sackett’s determination simply resulted in additional litigation from Ichud, asking the court to compel him to obey.
That’s when Cohen discovered the fatal flaw in the original agreement it sought recompense for the already-paid 2005 tax lien, rather than the 2006 taxes that were now due.
“They didn’t realize you have to sue annually,” he related. “…I was able to find a technicality to challenge it on.”
It took more than a year, but eventually everyone realized what had happened (and was going to happen), and by that time Ichud was already successfully applying to renovate the old Sedlack’s Appliances store next door to turn it into the fully-taxed grocery store that now exists there.
The new agreement, just approved by Judge Sackett in November, obviously does not include the grocery store. But it does include the original 100-acre property along Route 42, which remains tax-exempt since it includes a synagogue and religious learning center (though Ichud is paying $20,000-a-year for the next seven years in lieu of taxes, to be split between the school, county and town).
What’s changed, said Cohen, is that (1) Ichud will have to pay its 2006 tax lien (though 2005 will be refunded), and (2) it will have to reapply annually for the tax exemption, letting the town assessor decide if they get it just like with any other individual and organization in Thompson.
Cohen, a noted statewide expert on tax-exempt issues, would have liked to argue Ichud’s entire tax-exempt status in court, considering it’s what he and former Thompson Assessor Tom Frey consider “a classic bungalow colony,” with most of the property not being utilized, in their estimation, for religious or educational purposes.
Though unable to account for his colleagues’ approval of what he viewed as a “totally improper” 2006 settlement, the county treasurer is pleased with how it all turned out in 2007.
“I’m very proud of what we’ve been able to accomplish in this,” said Cohen.