The Ithaca City School District (ICSD) Board of Education has submitted the following letter to the Tompkins County Industrial Development Agency (TCIDA) regarding the proposed Beacon Communities LLC development at SouthWorks.
The Board is requesting that consideration of the project be paused until a comprehensive analysis of its potential fiscal impacts on the district is completed. The letter outlines the Board's concerns about the long-term effect of the proposed PILOT agreement on school funding and requests additional information to better understand the project's implications for ICSD students, taxpayers, and the district's financial sustainability.
A public hearing on the proposed project is scheduled for Wednesday, July 29, 2026, at 11:00 a.m. at the Tompkins County Industrial Development Agency offices, 119 E. Seneca Street, Suite 200, Ithaca, NY. The hearing will provide an opportunity for the public to offer comments on the financial assistance requested by Beacon Communities LLC. Community members may also submit written comments to the TCIDA in advance of the hearing.
The full letter submitted by the Board is available below.
Tompkins County Industrial Development Agency
119 East Seneca Street, Suite 200
Ithaca, New York 14850
Re: Proposed Beacon Communities LLC project at SouthWorks
Dear Board of Directors:
The Ithaca City School District Board of Education writes in reference to the proposed two-building project by Beacon Communities LLC at SouthWorks. In short, our position is that this project should be paused until the completion of a comprehensive study of its impact on the Ithaca City School District, the “District.” Our concerns are below:
As members of the Board of Education, we are stewards of the District’s fiscal health.
The District is responsible for providing every child residing in the District with a free, high-quality public education.
Approximately 70% of the District’s revenue comes from local property taxes.
Development that brings children but contributes little or no property tax revenue is a concern.
Based on the proposed configurations of the 230 units, we estimate that 150 children will attend District schools.
At our approximate marginal tuition cost of $25k per child, the total cost to the District could approach $4M per year if those children are new to the District.
We recognize that our revenue is based on development of the community as a whole, e.g., projects in Collegetown might pay property taxes with few or no children.
Nonetheless, even at its approximate assessed value of $12M, this project would generate about $180k in school taxes, the equivalent of about seven students.
The developers propose a PILOT payment of 12% of NOI, which would presumably result in school taxes well below the $180k.
The developer has significant control over the first-year NOI. E.g., the developer could increase operating costs, such as security patrols, and reduce revenue, such as parking fees, to ensure a first-year NOI close to zero.
This tax amount would increase by only 2% per year for 30 years, well below typical tax bill increases, ensuring a reduction in relative taxes over time.
Thus, whereas most TCIDA projects migrate to full tax bills after 7 or 10-year abatement, this project would pay little to no taxes for 30 years.
The District receives none of the sales tax revenue that this project could potentially generate.
It is our fiduciary duty to express caution and request a pause of this project pending the information requested below.
We are requesting a detailed year-by-year comparison showing:
Full school taxes at projected assessed value.
ICSD’s actual share of the proposed PILOT.
Estimated school taxes forgone each year.
Assumptions for net operating income, vacancy, rent growth, expenses, and management fees.
Expected number of school-age children by unit type.
Anticipated school assignments and transportation requirements.
Treatment of future assessments, refinancing, ownership changes, and expansion.
Audit rights and annual access to certified project financial statements.
Clawback or renegotiation provisions if affordability restrictions are reduced or project finances outperform projections.
Whether a minimum annual school payment or per-unit school impact payment is possible instead.
The loss of state education aid to Tompkins County, to the extent that children drawn from rural districts, which receive ~70% per-child state aid, are moved to ICSD, which receives only 30% per-child state aid.
The first sentence of the TCIDA “Programs and Policies” page states:
“The primary mission of the Tompkins County Industrial Development Agency (TCIDA) is to offer economic incentives to Tompkins County businesses in order to create and retain quality employment opportunities and strengthen the local tax base.”
The Board of Education of the Ithaca City School District does not believe that a project that will pay little to no taxes for 30 years is consistent with the TCIDA mission of “strengthening the local tax base.” We do believe, however, that a high-quality and fiscally sound school district will advance this mission. We ask that the TCIDA pause this project until the above questions can be investigated.
Sincerely,
Board of Education of the Ithaca City School District