GUILDERLAND — After repeated attempts to reduce its $15.7 million assessed value by as much as 80 percent, Macy’s struck a deal with the town of Guilderland to lower its assessment by about a third. 

The Guilderland Town Board on March 7 voted unanimously on a settlement agreement with the retailer that would lower six years of assessments to around $11 million. 

Though located inside of Crossgates Mall, Macy’s owns the 12 acres on which it sits. For four years, Macy’s sought to lower its assessed value from $15.7 million to $5 million, then $3 million, and finally $2.7 million.

A memo from town Assessor Heather Weinhold to the town board explained this is the second settlement offer made to the town and to the Guilderland Central School District.

In August 2021, a proposal was made to lower Macy’s assessments for 2019 through 2021 from $15.7 million to $10.1 million and its 2022 assessed value to $5.8 million, Weinhold’s memo says. This offer was rejected by both the town and school district.

“At that time, we decided that it was best to go forth and get Trial ready appraisals for any further legal action on this parcel,” Weinhold’s memo to the board states. “After review of both parties’ appraisals and further settlement discussions,” a settlement was agreed upon. 

For 2019 through 2021, the town, school district, and retailer agreed to a $10.8 million assessed value for Macy’s 12 acres. For 2022, the agreed-upon assessment for the land would be $9.83 million, which is due to the town’s equalization rate, Supervisor Peter Barber said during Tuesday’s meeting. 

The settlement locks in an assessed value of $10.5 million for 2023 through 2025, according to Weinhold’s memo, “unless specific changes are made to the property.”

Finances  

The general decline of brick-and-mortar retail coupled with the effects of the pandemic have led to steadily downward revenues for Macy’s: Its Crossgates’ store sales in 2021 were approximately $16.75 million, doubling its 2020 sales of $8.3 million.

Before the pandemic, in 2019, Macy’s at Crossgates had $18.7 million in sales, down from 2018 sales of $19.3 million, which was a rebound from 2017 when sales were $17.8 million. In 2016, Macy’s sales were $19.8 million; in 2015, $21.9 million; and in 2014, Macy’s sales at Crossgates were $23.5 million. 

The settlement with the iconic retailer means a hit to Guilderland tax coffers. 

Macy’s pays into six town and two county tax buckets.

For the years 2020, 2021, and 2022, the retailer paid close to $298,000 in town and county taxes, according to Weinhold’s memo. 

The stipulated settlement between Guilderland and Macy’s states, “Full refunds shall be due from all taxing jurisdictions (including any overpayments for library taxes, fire district taxes, and any other ad valorem levies) shall be paid to the Petitioner as a result of all the reduced assessment set forth herein for all years at issue. Refund payments shall be paid within 30 days of the affected taxing jurisdictions receiving a demand for such refunds.” 

Under the agreement, Macy’s corrected town and county tax bill for 2020 through 2022 would be about $200,000.

The actual town taxes for which Macy’s would receive a refund totals about $86,000, and has a corrected amount of about $57,500, with Guilderland refunding the retailer about $28,500 in town taxes. The tax amounts for the Westmere Fire Department and town’s ambulance service were corrected as part of the agreement, but neither appear to be on the hook for a refund. 

Between 2019 and 2022, Macy’s had an annual median school tax bill of about $270,000; having paid the Guilderland Central School District about $1.1 million in taxes over the four-year period, according to public tax records.

In the wake of Guilderland’s 2019 town-wide property revaluation, the town has faced a series of assessment challenges, largely from commercial properties, that has left particularly the Guilderland school district vulnerable. Last summer, the district drained its roughly $932,000 Tax Certiorari Reserve, took another $430,000 from its unrestricted fund balance, and then had to borrow $1.5 million to refund tax payments.