A state audit has cleared the Town of Hempstead Industrial Development Agency after some Valley Stream residents blamed it for surprise property tax increases.

"You have to give people notice that you're taking their money," says Mary Hansen-Sterger, of Valley Stream. "Don't just help yourself to our money."

She says she felt blindsided when her property taxes rose by about $1,000 last fall. She and others quickly blamed the Hempstead IDA for issuing a payment-in-lieu-of-taxes, or PILOT, tax break to the company that owns the Green Acres Mall.

But according to a report from the state comptroller, Valley Stream School District 30 is to blame for the hike.

Fred Parola, the IDA's executive director, says the findings come as no surprise.

"We knew that we'd be vindicated by the state audit," he says. "We knew who was responsible, that is, School District 30."

According to the audit, the district underestimated the amount of money it would get from the tax breaks by $1.8 million. That resulted in a tax hike of close to $315 per household.

In a statement, the district says it's now giving back that excess revenue. The average home will receive a tax cut of $382 this year. But it's also disputing the comptroller's report.

"The findings in this audit do not appear to have considered the detailed analysis of the PILOT agreements the district undertook in developing its estimates," the district says.

The Hempstead IDA has since taken away the PILOT break, Green Acres Mall filed a lawsuit shortly thereafter. The case is still pending in court.