Developer balks at paying Yonkers $400,000 to renew building permit

A Nassau developer is suing Yonkers for allegedly demanding nearly $400,000 to renew a building permit in what it claims is an illegal, hidden tax.

Miroza Tower LLC is asking Westchester Supreme Court to stop the city from collecting excessive fees, in a complaint filed on July 16.

“A renewal fee of $397,496 is not reasonably necessary to cover the costs for DHB [Department of Housing and Buildings] staff,” the complaint states “to revise the expiration date on the building permit and hit ‘print.'”

City attorney Matthew Gallagher stated in an email that Yonkers “is confident the court will determine the permit fees are reasonable and do not constitute an unlawful or unconstitutional tax.”

Miroza, a Hempstead affiliate of an Israeli real estate company, is building a $134 million, 25-story, 250-unit apartment building at 44 Hudson St. in downtown Yonkers.

The developer began the governmental approvals process in 2021 and has paid $1,014,134 for a variety of permits. The most expensive approval, the building permit, was issued a year ago and cost $794,492.

The building permit fee takes into account the size and complexity of the project, according to the developer, and is supposed to cover the city’s costs for reviewing plans, conducting inspections and enforcing regulations for the entirety of the project.

Miroza says it paid the building permit fee without objection.

It has built 13 of the 25 floors plus two below-ground floors, according to the complaint, and says it needs at least another year to complete the project.

Yonkers building permits are customarily issued for a year, the complaint states, “despite the obvious impossibility of completing construction of a 25-story tower in that time period.”

The building permit expired on July 18.

Yonkers allegedly advised Miroza that a renewal permit would cost $397,496, half the cost of the original permit.

Miroza claims the renewal fee is unconnected to the city’s actual costs, “particularly where no changes are proposed.”

The developer says state law requires building permit fees to cover reasonably necessary costs of issuance, inspection and enforcement, and may not be used to generate revenue for other governmental  functions. To do so would constitute an unauthorized tax.

Miroza is asking the court to declare that the renewal fee is illegal, bar Yonkers from collecting excessive fees and direct the city to renew the permit for 12 months.

Westchester Supreme Court Justice Thomas Quinones approved a temporary restraining order on July 18, and ordered a hearing for Aug. 23 to further consider Miroza’s demands.

The developer is represented by White Plains attorneys David S. Steinmetz and Jody T. Cross.

To read more from Bill Heltzel, click here.