GUILDERLAND — The school board here voted unanimously on Tuesday to refund Macy’s $373,623 in taxes because of a settlement on its assessed value.

“Most of that comes from the school district,” said Guilderland’s assistant superintendent for business, Andre Van Alstyne. “And then the rest will come from the library. We pay their share and they bill us.”

After repeated attempts to reduce its $15.7 million assessed value by as much as 80 percent, Macy’s at Crossgates Mall struck a deal with the town and school district 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. 

The settlement covers four years. For the first three years — for the 2019-20 school year through the 2022-23 school year — Macy’s original assessed value of $15,655,000 was reduced to $10,800,000.

For the school district, the refund for the first three years ranged from about $81,000 to about $84,000 as the district’s tax rate went from $16.76 per $1,000 of assessed value to $17.36.

For the fourth year, 2022-23, that same assessed value of $15,655,000 was revised to $9,828,000. The tax rate was $18.20 of assessed value. So the school district’s refund was $106,046.

For the Guilderland Public Library, which follows school district lines, the refund for the first three years ranged from about $4,320 to about $4,500 and was $5,646 for the fourth year.

Van Alsltyne said of the settlement, “This will also freeze the assessment going forward for the years 2024 and 2025. The assessment or the refund is much lower than what  Macy’s had originally sought in their claim.”

He concluded, “So the gap between the refund and what they had originally filed for is about $600,000.”

The general decline of brick-and-mortar retail coupled with the effects of the pandemic have led to steadily downward revenues for Macy’s.

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.

Later at the March 21 meeting, as the school board discussed its $120 million budget proposal for next year, board member Judy Slack asked, “How are we going to refill our cash reserves after being clobbered this year?”

Van Alstyne conceded that the tax refunds as well as “the legal expenses associated with defending the district’s interests” had been disruptive.

The proposed budget for next year includes $1.4 million in tax certiorari claims as well as $80,000 in increased legal expenses related to assessment challenges.

Van Alstyne went on, “The money that is in the budget for next year is when we have finality with sort of the totality of claims. We have the ability to bond but it doesn’t make sense, fiscally, to bond it until we know what that amount is.

But that will let us have leeway in sort of recouping what we’ve spent cash on this year for those reserves … We have to be prudent and plan for what our exposure is. But, if things are not as bad as the worst-case scenario, then that is additional flexibility there.”

The board also met in closed session, as allowed by law, to discuss proposed litigation strategy for three separate tax certiorari claims.