The Burton Towers building at 36 Cerone Place.
By Nancy Peckenham
The Newburgh Housing Authority took the first step Thursday towards approving the issuance of a $10 million tax-exempt bond for renovations at the troubled Burton Towers apartment house for low-income seniors and disabled residents.
In September, the city of Newburgh approved the sale of Burton Towers to Mountco Construction and Development Corporation after the previous owners went bankrupt. The deal was worked out after the city and the housing authority faced each other in court for control of the building’s future. (Read about the settlement here.)
At Thursday’s meeting, housing authority commissioner Gay Lee said the court fight put the housing authority in a bad light and led to the resignation of its executive director Marc Starling, who left the organization at the end of November. She added that the authority now wants to extend a hand to work together with Mountco and the company’s vice president John Madeo said he, too, looks forward to working with the authority as a partner at Burton Towers.
Madeo also wanted to clarify to the housing authority that when works starts next year on the major renovations at the building, Mountco will try to hire contractors from the City of Newburgh but cannot guarantee that all workers will be from the city. “We are very price conscious and will not hire just because they are from the City of Newburgh,” Madeo said, adding that he welcomes suggestions of local contracting firms.
Before the $10 million bond can be issued, the housing authority will hold a public hearing and Mountco will comply with an environmental review. Once the bond is issued, the housing authority will receive a $100,000 administrative fee that it can use at its discretion. The bond is expected to be at a low interest rate, with no tax on interest payments.
Also on Thursday, the city council discussed making an agreement with Mountco that would allow the developer to make payments in lieu of taxes, starting at $105,000 a year and increasing over time. The owners have already agreed to pay the back taxes owed to the city.
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