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Nucor filed the challenge in New York State Supreme Court in June. According to the company’s petition, it believes its properties at 25 Quarry Road, 19 Quarry Road, 279-287 North St. and 33 York St. in Auburn should be assessed at a combined $2,649,600. That’s $12,714,200 lower than the city’s final 2023 combined assessment of $15,363,800 — a decrease of 83%.
Jason Curtis, general manager of Nucor Steel in Auburn, told The Citizen the company based its challenge on a review of comparable industrial facilities in the city by a consultant in 2021. The review led the company, which employs more than 250 people, to conclude that its assessments are “dramatically” higher than those comparable properties, Curtis said.
Though Nucor already received one reduction after challenging the city’s tentative 2023 assessments, the final assessments are still “excessive” and “illegal,” the company’s petition said.
“Because of these errors, (Nucor) will be required to pay significantly higher taxes than it would be required to pay if the assessment(s) had been made correctly,” the petition said.
Curtis said Nucor has been working with the city, provided its assessor’s office information about the company’s properties and the steel industry, and offered tours of the facility. The company has also discussed its assessments with representatives of Cayuga County and the Auburn Enlarged City School District, which receive tax revenue from Nucor’s properties as well.
“We value our relationship with the city and being part of the local business community,” Curtis said. “We are simply hoping that we can come to a fair and reasonable property value assessment.”
But assessor Jeanne Hering, with the city of Auburn’s Office of Real Property Assessment, told The Citizen on Thursday that she does believe Nucor’s assessment is fair.
The company’s assessments were based on “a lot of analysis,” Hering said, including the prices of other steel mills that have recently sold in the Northeast. She also provided The Citizen a spreadsheet of 32 city properties zoned for manufacturing and processing, and how much they’ve been assessed per square foot. Nucor is the 12th highest, at $32.66.
The company’s 2023 assessments are low historically, too. According to city records, Nucor’s main 25 Quarry Road property was assessed at about $30 million until 2021, when it dropped to $15.2 million.
“They really haven’t given us anything to prove that what they think their assessment should be is correct,” Hering said.
If Nucor’s assessment is lowered, the amount of taxes the company pays to the city, county and school district will probably lower as well. But that amount will vary over the next eight years due to Nucor’s payment-in-lieu-of-taxes agreement with the Auburn Industrial Development Authority. The 2007 agreement was extended in 2020, and continues through 2031.
The 2023-2024 tax year will see Nucor return to being taxed based on its assessed value. Under the PILOT, the company paid taxes based on a total value of $4.5 million in 2021-2022 and $5.25 million in 2022-2023. But Nucor will receive a 60% tax abatement in 2023-2024, and that figure will decrease incrementally every year until it’s 10% in 2030-2031.
Nonetheless, with the city’s current total tax rate at 35.4%, the amount of revenue at stake as Nucor challenges its assessment is indeed significant, said Michael Miller, executive director of the Cayuga Economic Development Agency. That’s why the agency, which staffs the Auburn Industrial Development Authority, is watching the challenge closely, he told The Citizen.
Depending on how the challenge plays out, AIDA could revise its PILOT agreement with Nucor, Miller said.
“All PILOTs are here to help induce economic activity. If it’s not assisting both the company and the community, then there’s a disconnect,” he said. “But I think Nucor has been a good employer for the city of Auburn for a long time. That’s part of the reason they’ve had a longstanding PILOT with AIDA. I don’t imagine that how this falls would be considered a contentious issue.”
