Riverhead tax bills spike after judge orders $6M refund for luxury golf course

Riverhead Town residents are seeing spikes in their property tax bills after the Friar’s Head golf course, a luxury club on Sound Avenue, won a $6 million tax refund.

Riverhead was required to pay a total of $7.2 million in tax refunds this year, which is passed on to town property owners through their tax bills, according to the Suffolk County Comptroller’s Office. Most of the figure — $6 million — covers tax refunds to Friar’s Head, county officials said. This year's refund liability is more than 2½ times what it was a year ago, records show.

The tax dispute dates back nearly two decades after the course's owner filed a lawsuit challenging the town’s assessment of the 350-acre property. The land includes an 18-hole championship golf course, clubhouse, three guest cottages and a helipad, according to court documents.

Some residents opening their tax envelopes this year were surprised to see a 160% jump in the “New York State Real Property Tax Law” line without any explanation. The line, featured on all Suffolk tax bills, is used to cover tax refunds across each of the county's 10 towns. 

“It was startling to see it on the bill,” said Bill Welsh, of Jamesport.

Welsh, 74, said his taxes on that line went from $162 to nearly $420 this year and recently raised the issue at a meeting of the Greater Jamesport Civic Association.

He said it’s concerning that the town’s failures to assess properties correctly have cost taxpayers.

“The residents seem to pick up the balance there,” Welsh said in an interview. “The residents become the payment of last resort.”

In the lawsuits, the golf course alleged the town assessor's office set “erroneous” and “excessive” assessments, valuing the property between $28 and $34 million from 2008 to 2015. In 2019, a Suffolk judge cut those values to a range of $10 million to $11.6 million during those years.

State Supreme Court Justice John J. Leo ruled in 2019 the town had erred by considering the potential for residential development on 85 acres of vacant land in the property's overall valuation. 

“It would be unfair to tax a property for a value that it does not have,” Leo wrote.

The judge’s ruling slashed the golf course’s assessed value by more than 60% for those tax years and kept the lower assessment in place through 2018. Leo ordered the Suffolk comptroller's office to refund the overpayments, along with accrued interest.

In Suffolk, refunds that stem from successful tax challenges are initially funded by the county government. Then, the county "charges back" the amount to taxpayers in the town where the property lies. The property owners reimburse the county through a line on their tax bills.

The town appealed. In February 2024, the Appellate Division's Second Judicial Department upheld the lower court’s ruling. 

Jacquelyn Mascetti, an attorney for Friar’s Head from the Melville firm Herman Katz LLP, declined to comment. She cited ongoing litigation with Riverhead Town. The club is also challenging tax years from 2018 to 2022.

Laverne Tennenberg, who chairs Riverhead’s board of assessors, acknowledged the chargeback is having an impact on tax bills this year. The town made its case for valuing the 85 acres, where there was potential for new housing, she said. Riverhead officials said a developer could subdivide that property to create up to 55 residential lots, a move that would significantly increase the property's overall value. But a judge rejected that argument since the golf course never sought to subdivide the land or build housing there.

“We presented a methodology about the excess land. The judge didn’t want to hear it,” she said in an interview. “There’s nothing we can do about it.”

Frozen for decades

Riverhead, like most towns in Suffolk, has not conducted a townwide reassessment since 1980, Tennenberg said. The North Fork town has a population of more than 36,000, according to recent U.S. Census data.

Just two Suffolk towns, Shelter Island and Southampton, have reassessed since 1980, according to the state Department of Taxation and Finance. Southampton's last reassessment was in 2019, while Shelter Island's was in 2025.

She did not say what the average impact will be on residents’ tax bills, noting it depends on individual property values.

“The higher your assessment, the more you pay back,” she said, adding it’s a one-time charge that fluctuates each year.

Though the concept is unpopular, residents like Welsh said the town should consider reassessing properties more frequently. Regular reassessments keep property values closer to market value and ensure that the tax burden is more equitably distributed. 

“But I know politically, it’s a hot potato,” he said. "Nobody wants to come out and say ‘let’s do this,’ because they won’t be there next November.”

'Specialized' cases

Experts said golf courses are “specialized” properties that are hard to assess. A business' revenue and income is part of the property's valuation.

“A lot of times, you don’t know what the competing properties are doing in terms of their revenue when they sell,” said Jeff Davis, managing director at Fairway Advisors, a golf course brokerage in Dallas. “And absent of knowing that information, you’re really guessing.”

In the Friar’s Head case, Davis said it's important to consider economic factors when they first challenged the assessments in 2008.

“That market was completely different than today. Golf is on fire now, but it was not back then, coming out of the Great Recession,” Davis said.

An analysis of current tax documents showed Friar's Head, the largest golf course in Riverhead, was billed $320,518 in town taxes this year. Other courses, including the 154-acre private Baiting Hollow Golf Club and the 149-acre Long Island National Golf Club, owe $194,994 and $197,819 in town taxes, respectively, town records show.

Larry Clark, the retired director of strategic initiatives at the International Association of Assessing Officers, said  municipalities should retain appraisers who specialize in golf courses and analyze national trends and data.

Clark said annual reassessments are a recommended industry standard, one he adopted as an assessor in Kansas.

“That allowed us to keep up with changes in the market,” he said.

Other taxes up, too

The chargeback comes as Riverhead taxpayers also contend with a 6.74% tax rate increase — the fourth consecutive year the town board opted to pierce the state's tax cap. Its budget this year is $121.1 million.

County finance officials said the payment to Friar’s Head includes nearly $4.4 million in refunded taxes and more than $1.6 million in interest.

Last year, Riverhead’s total chargeback was nearly $2.8 million. The figure did not include any payments to the golf course.

Other town residents noticed the increase and want more explanation from town officials.

“People deserve to understand what all of this means,” said Joan Cear, also of Jamesport. The refund line on Cear’s property tax bill jumped from $130 in 2025 to $341 this year.

“That’s a big increase,” she said. “It’s not fair to the residents to pay for such an egregious error by the town.”

The town could be on the hook for more refunds to the golf course. Several challenges are pending in court, covering the 2018 to 2022 tax years. Those challenges also claim that the town's assessments were “excessive and unequal,” according to court filings.