Peekskill/Hen Hud School Districts Split RESCO; Win-Win Agreement

The Peekskill and Hendrick Hudson school districts have settled a two-year legal dispute over allocation of revenue from the Westchester RESCO garbage to energy plant on Charles Point in Peekskill.

The settlement, approved this week by the districts’ boards of education, will

a) clearly define the boundaries between the two school districts, b) reallocate the distribution of RESCO PILOT (Payment in Lieu of Taxes) payments and properties between the two districts in a manner consistent with the newly agreed upon boundary lines, and c) move several City parcels, formerly in Hendrick Hudson, to Peekskill.  

The agreement will result in an increase in revenues to the Hen Hud School District of over $12.5 million over the life of the PILOT (Payments in lieu of taxes) agreement, which runs through 2034. This is because the two school districts agree that revenues generated from the PILOT agreement should be divided 62/38 percent between Peekskill and Hendrick Hudson rather than 71/29 as previously existed. The settlement will also provide the Peekskill School District with additional potentially taxable properties within its boundaries and avoid what could have become very costly litigation. The revenues to the City will remain virtually unchanged.

The Peekskill and Hendrick Hudson school boards approved the settlement, formally known as a New York Civil Practice Law and Rules Article 78 proceeding, earlier this week.

The PILOT agreement dates from 1980 and provides revenue for both districts. The garbage plant, which straddles the boundary, does not pay regular taxes.

School officials described the settlement as a win-win situation.

“We are pleased to have this longstanding issue resolved,” said Hen Hud Superintendent of Schools Dr. Daniel McCann.  “This is a fair settlement that recognizes the appropriate boundaries and properties between the Peekskill School District and the Hendrick Hudson School District.  The agreement reflects an equitable distribution of properties and a fair distribution of revenues between the districts.”

The land transferred to Peekskill is expected to provide that district with additional tax revenue when it is developed, Superintendent of Schools James Willis said.

“This agreement benefits all parties and, most importantly, the children of both communities,” Willis said.