The developers of the Syracuse Developmental Center received a 30-year tax break from the Syracuse Industrial Development Agency. Credit: Julie McMahon | mcmahon@centralcurent.org

City officials have proposed amending how Syracuse gives tax breaks to companies who want to do business inside the city. 

Broadly, the changes involve:

  • Reducing the size of the most lucrative tax breaks in the short-term
  • Lengthening the tax breaks for companies
  • Creating incentives for companies who want to bring business to particular neighborhoods and places

If Syracuse’s Industrial Development Agency approves the changes — they are set to vote Tuesday at 8 a.m. — it would be the first time since 2016 that the city amended how it gives tax breaks. 

The city attempted to change the policy, called a uniform tax exemption policy and referred to as a UTEP, in 2022. That UTEP was approved but never used by SIDA. The city wanted to hold off on updating the policy until it studied its housing stock and published its housing strategy. 

“We’ve had conversations with the development community, we’ve had conversations with community advocates and really within our board of directors to say, ‘What are ways that we can help with incentivizing the type of development that we want to see in Syracuse?’,” said Eric Ennis, the city’s deputy commissioner of Business Development. 

Ennis said the city is now changing its UTEP in part because of market changes over the last nine years. For instance, building costs have jumped since the beginning of the Covid-19 pandemic.  

Syracuse’s tax exemption policy has drawn fire in the past. Former city councilor Mike Greene chastised during his bid for mayor the city’s use of its UTEP. In a letter to syracuse.com | The Post-Standard, Greene wrote that the city’s tax break schedule “is uniquely generous to large corporations and developers.”

The city for the last nine years has been giving tax breaks that exempt 100% of a company’s property tax increases in the first seven to 10 years of developing a property. 

Under the proposed UTEP, that would stop. The lucrative 100% tax exemptions would be capped at five years — unless the project falls under an incentivized category. 

However, the city expanded the timelines for which it gives tax breaks. Ennis said that decision was made, at least in part, because of feedback it received from developers. Investors are more likely to finance a project that receives tax breaks over a longer period of time because it signals “greater certainty,” Ennis said. 

Projects that could get an enhanced tax break would have to fall in one of these categories:

  • Historic project: Qualifying projects include ones that restore and renovate a building designated as a local protected site by the Syracuse Landmark Preservation Board or that is listed on or part of a district on the National Register of Historic Places 
  • Infill project: Qualifying projects include ones on the development of vacant or unused land or the redevelopment of a structure that has been vacant for a minimum of five years. 
  • Bus Rapid Transit Route projects: These projects must happen around future bus rapid transit routes.
  • Brownfield site: Qualifying projects include sites designated by the New York State Department of Environmental Conservation or the United States Environmental Protection Agency.
  • Priority neighborhood: Qualifying projects must happen in neighborhoods that are included in the city’s housing strategy plan.

These boosted tax breaks extend the number of years a project could receive a 100% abatement beyond the five year cap and adds five years to the length of the tax break, creating the city’s first 20-year tax break schedule. 

The city’s current tax break schedule only additionally incentivizes “priority commercial and residential” projects. Projects that qualify for that designation either:

  • Fall inside one of the city’s Neighborhood Revitalization Strategy Areas or
  • Have residential units, with 20% of those units being affordable for people or families who earn up to 65% of the area’s median income.

See the proposed tax exemption schedules below:

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Chris Libonati is the managing editor of Central Current. He is a founding editorial member of the organization and was hired as Central Current's first reporter. He previously worked at the Syracuse Post-Standard...