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Appeals court backs Ulster County agency’s decision to turn down tax relief application

Originally Posted on Daily Freeman

A state appellate court has ruled the Ulster County Industrial Development Agency was justified in rejecting tax relief requested by tower crane company 2-4 Kieffer Lane LLC.ADVERTISING

In a six-page decision dated May 9, the Appellate Division of state Supreme Court, Third Judicial Department, upheld a lower court’s February 2018 ruling that the agency acted properly in turning down Kieffer’s request for a $978,000 sales tax exemption on the $12.9 million purchase of eight large cranes.

Kieffer, owned by Thomas Auringer, also must pay the Industrial Development Agency’s court costs, the appellate court ruled.

“In denying [Kieffer’s request], the IDA reasonably concluded that the goods/services proposed by petitioner were not sufficiently unique or different from the cranes provided by an existing local crane company and that there was little or no demonstrated need for tower cranes within Ulster County,” the appellate ruling stated.

The decision stated that 2-4 Kieffer Lane LLC — named for the address in the town of Ulster where Auringer wanted to operate — was “unable to identify any existing or anticipated projects in the county that required tower cranes and did not provide any evidence to demonstrate that tower cranes had been recently used within the county.”

Also, the ruling stated:

• “The crane company that already existed in Ulster County at the time of petitioner’s application was willing to provide tower cranes if a need were ever to arise in the county,” and

• “Even if the IDA had found petitioner to be eligible for the … tax exemptions, the relevant statutory provision states only that the IDA may provide the requested financial assistance; the IDA is not required to do so.”

IDA board Chairman Randall Leverette said in a press release about the appellate court ruling that the decision supports the process used by the agency to determine the merits of applications.

“The agency is delighted … and was confident from the outset that it had acted in the best interest of Ulster County residents,” Leverette wrote. “It’s simply not enough for a proposed project to apply and qualify for exemptions and IDA benefits; inducements are discretionary, and a project must actually benefit residents of Ulster County as outlined in the IDA statute.”

The IDA rejected Kieffer’s tax relief application in August 2017. The company filed its lawsuit suit against the agency a month later.

Among Kieffer’s arguments in the suit was the IDA’s denial was the result of labor unions pressuring agency board members.

For several months during the IDA’s process of reviewing Kieffer’s application, union representatives urged agency officials to look into the bankruptcy and labor relations history of companies associated with Auringer.

Appeals court backs Ulster County agency’s decision to turn down tax relief application
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