Court documents filed Tuesday show Riverhead officials agreed to reduce United Riverhead Terminal’s property tax assessments by more than $6.66 million over seven tax years, a settlement that could cost taxpayers an estimated $1.27 million for the tax years already billed.
The stipulations of settlement and proposed orders were filed in Suffolk County Supreme Court on Aug. 18 in multiple tax certiorari proceedings brought by United Riverhead Terminal Inc., owner of the petroleum storage terminal property in Northville.
The documents do not state a single refund amount. Instead, they reduce the assessed values of nine URT tax parcels for tax years 2020/21 through 2026/27 by a total of $6,662,856 in assessed value.
Based on the tax rates and levy lines in Riverhead’s online tax records, RiverheadLOCAL estimates the settlement will generate approximately $1.27 million in refunds or tax credits for the six tax years already billed, 2020/21 through 2025/26. The final refund amount will be calculated by Suffolk County.
RiverheadLOCAL did not include the 2026/27 reduction in its estimate because the 2026/27 tax bill has not yet been issued.
See: How we calculated the estimated refund amounts (below)
The settlement sets URT’s reduced 2026/27 assessment at $1,932,500, a $367,864 reduction from the original assessment. The stipulation further provides that URT will not file assessment challenges for the 2027/28, 2028/29 and 2029/30 tax years if the assessments for those years remain the same as the 2026/27 assessment, subject to the assessor’s rights under state law to change future assessments for permissible reasons.
Under the Suffolk County Tax Act, tax certiorari refunds are paid by Suffolk County and then charged back to taxpayers in the municipality where the property is located.
The proposed orders say the Suffolk County Comptroller must issue the refund within 90 days after service of the order and judgment and related documents. If the refund is not paid within that period, statutory interest will accrue.
The stipulations are signed by lawyers for URT and for the town, as well as by Laverne Tennenberg, chairman of the Riverhead Board of Assessors. The proposed orders had not yet been signed by a judge as of Aug. 19 at 9 a.m.
The Town Board voted Aug. 4 to authorize settlement of the URT litigation, but the resolution did not disclose the settlement terms or the estimated cost to taxpayers. Board members declined to answer questions about the amount of the settlement or what it would cost taxpayers before voting Aug. 4 to approve the resolution authorizing the settlement. The town attorney declined to provide the amount. Supervisor Jerry Halpin told a resident to speak to the assessors’ office.
Officials remained mum despite the resolution’s language stating that the board had reviewed the proposed settlement with the town attorney, the town assessors and special counsel representing the town in the litigation and authorizing the town attorney to sign the settlement agreement. The town attorney told one resident she could “FOIL for” the settlement.
RiverheadLOCAL filed a records access request under the State Freedom of Information Law on Aug. 6. That request has not yet received a response from the town other than the automatic reply notifying the requester that the town will respond within 20 business days to “either grant and/or deny access in whole or in part or to provide a date certain that a response will be provided.”
Officials again declined to provide a dollar amount at Tuesday night’s board meeting, when residents questioned the settlement with United Riverhead Terminal.
“I found it a little bizarre that we can’t get the numbers of how much was involved in the legal settlement that we’re all going to have to pay for, and exactly what it covers,” John McAuliff of Riverhead told the board. “I mean, that ought to have been in the first piece of paper, not hidden behind some kind of legal process that is not explained.”
Council Member Ken Rothwell said the town wants to have “full transparency throughout the whole process” and pledged to “work with the county to see if there’s a way to extend the payment schedule so that it is not a one-time hit.”
State law controls how the refund is paid and charged back. Under the Suffolk County Tax Act, the county pays the tax certiorari refund and charges the amount back to the town. The act also allows the county, with the town’s consent, to finance the chargeback under the Local Finance Law, spreading repayment over time. That would affect how Riverhead taxpayers repay the county, not necessarily when URT receives the refund. The proposed order directs the Suffolk County Comptroller to issue the refund within 90 days after service of the order and judgment, with statutory interest if it is not paid on time.
Rothwell said he’s gotten a number of phone calls from people concerned about what they will have to pay the county for property tax judgments and settlements in their next tax bill.
Last year, residents were surprised by an unusually large sum added to their property tax bills, mostly to cover a property tax refund due Traditional Links, owner of Friars Head Golf Club in Baiting Hollow, pursuant to a court judgment totaling roughly $6 million. Additional refunds to other taxpayers last year boosted the total tax refund liability to more than $7 million. Under state law, the county advances the cash and town taxpayers directly reimburse the county for the refund expense, bypassing the town budget.
“These are the court battles that we are seeing, where we potentially have agreed to settlements, and we just want to be fully transparent with everybody,” Rothwell said Tuesday night. “And once we have an idea of what that dollar amount is going to be, we’ll try to get a figure that will kind of give more of an average — what an average taxpayer in the Town of Riverhead will be assessed on that to make up for those assessments,” Rothwell said.
“So, once we have information to share, well, it’ll be forthcoming,” he said. “So, just letting everybody know that I hear your concerns, and we want to put that out as soon as possible, so everybody will be aware of how it affects each and every one of us.”
Rothwell did not acknowledge — or indicate he was aware of — the settlement documents and proposed orders being filed with the court earlier in the day on Tuesday, and posted publicly on the court’s website for public inspection.
How we calculated the estimated refund amounts
RiverheadLOCAL calculated the estimated refund by comparing the original taxes billed on each URT parcel with the taxes that would have been due under the reduced assessments in the court settlement.
The settlement documents list the original assessment, the agreed reduction and the final assessment for each parcel and tax year.
RiverheadLOCAL then reviewed the town’s online tax bill records for the nine URT parcels for tax years 2020/21 through 2025/26. Each bill lists individual levy lines, including town, county, school, library, ambulance, fire district and other charges, with the taxable value, tax rate and tax amount for each line.
For each levy line, RiverheadLOCAL applied the bill’s tax rate to the reduced taxable value and compared the result with the original amount billed. The difference is the estimated refund or credit for that line.
Those line-by-line differences were added across all nine parcels and six billed tax years. The calculation produced an estimated refund or credit of $1,270,122.22.
The estimate does not include the 2026/27 tax year because that bill has not yet been issued. The final refund amount will be calculated by Suffolk County and could include statutory interest or other adjustments.
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