Batavia Towne Center

Members of Genesee County's law enforcement community were at Batavia Towne Center Saturday for the annual Stuff the Cruiser event.

Shoppers are asked during the event to donate gifts that will be distributed for Christmas to families in Genesee County.

Last year, the event assisted 450 local families.

Officers said that by mid-afternoon, in sunny weather, this year appeared to be a banner year for donations.

At least one question that readers and The Batavian had about the new electric vehicle charging stations on the west side of town has been answered: they are open for business.

Two Teslas were captured in action this weekend at the station on Veterans Memorial Drive in Batavia. Emails and a phone call this past week to Lisa Appelbaum, project developer of Charging Infrastructure, were not returned, nor were emails to Tesla's Press Office returned for comment. 

Photo by Howard Owens.

 

Tesla, apparently, has installed 12 electric vehicle charging stations in the parking lot of Batavia Towne Center off Veterans Memorial Drive.

Neither Tesla, which makes electric cars, nor COR Development, owner of the shopping center, responded to requests for additional information.

The Tesla website lists Batavia as a future location for electric vehicle charging stations but says the stations won't open until the second quarter of 2023.

Photo by Howard Owens, taken on Thursday.

Update: March 19, 4:30 p.m.

A spokesperson for Gap Inc. told The Batavian that 30 to 50 employees are expected to be hired at this location.

The Batavia store adds to the company's Western New York footprint that currently has five stores in the Buffalo/Niagara Falls area and four in the Rochester area.

"Our brand offers on-trernd, affordable and high quality products that we now are excited to make available for families in the Batavia community," the spokesperson added.

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Two new stores – Old Navy and Ulta Beauty – will be coming to the Towne Center at Batavia on Veterans Memorial Drive within the next few months.

Town of Batavia Building Inspector Dan Lang confirmed at tonight’s Town Board meeting that the merchandising giants are expected to open at the retail hub this spring.

He said that the Old Navy clothing store at 4222 Veterans Memorial Drive will feature 14,588 square feet of retail space, while the Ulta Beauty cosmetics store at 4192 Veterans Memorial Drive will have 10,723 square feet of retail space.

The Old Navy store is taking space formerly used by Bed Bath and Beyond.

Searches on the companies’ websites reveal that Old Navy, part of Gap Inc., is advertising for part-time brand associates and Ulta Beauty is advertising for part-time beauty advisors at Towne Center at Batavia.

Founded in 1994 and headquartered in San Francisco, Old Navy has approximately 1,106 stores worldwide. Its total revenue in 2019 was $4 billion. The largest of the Old Navy stores are its flagship stores, located in New York City, Seattle, Chicago, San Francisco, Manila, and Mexico City.

In business for more than 30 years, Ulta Beauty has approximately 1,200 stores in all 50 states and, according to its website, has created more than 22,000 new jobs since 2015. Ninety-two percent of its 45,000 store, distribution center and corporate associates are women. Its headquarters are in Bolingbrook, Ill.

The Batavian has reached out via email to Old Navy and Ulta Beauty media relations for additional information.

Press release:

Marshalls, one of the nation’s largest off-price retailers with more than 900 stores currently operating in 43 states and Puerto Rico, will open a new store in Batavia on August 21, 2014. Marshalls shoppers in Batavia will find top-quality, on-trend fashions and the most sought-after designer brand names at unbelievable prices in ladies fashion, shoes, accessories, men’s apparel, home, juniors, kids apparel and accessories, luggage, beauty and more!

“The new Batavia store will be stocked with a new, fresh assortment of the designer and brand-name merchandise that shoppers love, every single week,” said Richard Sherr, president of Marshalls. “Our buyers are fashion experts with a keen sense of style and are passionate about finding the most coveted merchandise for our shoppers for so much less!”

GRAND OPENING

Join us on August 21st from 8 a.m. until 10 p.m. to be part of the grand opening excitement and find the amazing deals for the whole family. Enjoy the festivities including giveaways, gift card prizes, and more. 

STORE FACTS & FEATURES

·      Location: Towne Center at Batavia

·      24,479 square feet

·      Regular store hours:

o   9:30 a.m. to 9:30 p.m. Monday-Saturday

o   11 a.m. to 8 p.m. on Sundays

·      Designer fashion at unbelievable prices

·      THE CUBE: A hip, in-store boutique of contemporary fashions

·      Shoe Mega Shop: Featuring designer and brand-name shoes for the whole family

·      Bright and fresh in-store experience every time you shop

·      Single queue checkout for faster shopping

With over 10,000 new items arriving to the Batavia store every week, it’s like entering a whole new store with every visit. Unlike department store buyers who shop seasonally, our buyers are in the market weekly looking for merchandise opportunities. They work with more than 16,000 brands and designers annually in over 60 countries to offer a mix of top-quality, fashionable pieces from the most sought-after designer brands as well as unexpected treasures from around the world.

ECONOMIC IMPACT

In addition to providing a new shopping option for local residents, the new store will add approximately 60 full- and part-time jobs to the area.

COMMUNITY PARTNERSHIPS

In celebration of its new Batavia location, Marshalls will contribute to the local community by presenting a $5,000 donation to Catholic Charities at the ribbon-cutting ceremony on August 21st 7:30 a.m. Marshalls also has national and local partnerships with charitable organizations around the country including JDRF and St. Jude Children’s Research Hospital.

This morning contractors working on the former Lowe's location, getting the remaining space ready for new retail stores, apparently forgot to turn the water off to the sprinkler system before deciding to disconnect a pipe. The pipe needed to be relocated to make room for a new entrance to the new store. Workers undid two bolts and whoosh! An explosion of water. Perhaps as much as 1,000 gallons spilled out before the water was shut off. The break caused the water flow alarm to go off resulting in a response from the Town of Batavia Fire Department. Volunteer firefighters grabbed squeegees and brooms and helped clear the water out from inside the building.

Batavia's Bed, Bath & Beyond, damaged by fire Jan. 27, has been cleared of all its stock and today work crews were pulling from the store every last bit of fixture, shelving and even wall.

Smoke odor still permeated the entry way.

A manager said she doesn't know when the store will reopen. She said she didn't know when new stock would arrive. Asked if employees had been offered jobs at other locations, she said we would have to call the corporate office.

We called the corporate office this afternoon and have not yet gotten a response.

Within minutes of the fire call about a blaze in the bedding department of Bed, Bath & Beyond, in Batavia Towne Center, the store was filled with heavy black smoke that was roiling out of the front and back doors.

The visibility was low, making it difficult for the first firefighters on scene to get to the fire location.

"There was heavy smoke, but once the crew got in there they confirmed a working fire," said Town of Batavia Fire's 1st Assistant Chief Dan Coffey.

Much of the bedding department was destroyed by fire. The rest of the store's inventory and fixtures suffered heavy smoke and water damage.

The store's sprinkler system did activate, which Coffey said helped suppress the fire, but it took firefighters to actually knock down the flames. The rest of the next couple of hours on scene was spent clearing out smoke from Bed, Bath & Beyond and Petco.

"We got a quick knock down and then we were trying to clear smoke and improve the visibility of what we were doing," Coffey said.

There were employees -- Coffey didn't know how many -- who were evaluated for possible smoke inhalation.

Both stores remain closed.

"The fire investigation has already started and there's significant fire, smoke and water damage in there, so I imagine it's going to be some time (before Bed, Bath & Beyond reopens)," Coffey said.

Coffey described the bedding fire as pretty hot, with the material able to pack a heavy fire load.

"If you've been in there, you've seen, the bedding is stacked from floor to ceiling on those storage racks, so there's a tremendous amount of heat," Coffey said. "It's certainly a concern for us."

Adding to the fire-fighting difficulties was the icy weather. The air was biting and the fire hydrants frozen shut.

Three tankers from neighboring departments were requested to the scene, something that wouldn't have been necessary, Coffey said, if the hydrants hadn't frozen.

Assisting Town of Batavia at the scene were City of Batavia, Alexander, Elba, Oakfield, East Pembroke and Darien.

The cause of the fire has not yet been determined. Investigators are conducting interviews, examining the physical evidence and it's possible store surveillance tapes may provide a clue to the cause.

"It's way to early," Coffey said soon after the smoke had cleared. "We're trying to talk to employees who were in the area at the time and try to determine the cause."

UPDATE 11:47 p.m.: Investigators have been on scene through the evening and into the night. There is no definitive cause, officials say. The Sheriff's Office is leading the investigation.

(Initial Report)

The front door soon after the fire was pronounced knocked down with the store still filled with heavy black smoke. Normally, you would be able to see into the store from this angle. Pictured, East Pemborke's Stephen Smelski.

Heavy smoke at the back of the building.

A frozen fire hydrant.

A Town of Batavia volunteer, Mike Jones, prepares Ladder 25 for extension of the platform.

Firefighter Scott Maloy shortly after exiting the building.

A firefighter tries to get one of the frozen hydrants going.

Firefighters at the back of the building.

Smoke being cleared from the storage room.

A firefighter on the roof of Bed, Bath & Beyond. Pictured, Jason Holman.

Firefighter Andrew Mullen waiting by the back door for other crew members who will head back in to make further checks on the fire scene, with most of the smoke cleared from the store.

East Pembroke's engine in front of the store as crews begin to roll up hose.

A subdivision of Batavia Towne Center to make way for a Kohl's Department Store was approved by the Town of Batavia Planning Board on Tuesday night.

The subdivision is necessary, according to Kate Johnson, of COR Development (top photo) because Kohl's needs its building on its own parcel for financing, tax and insurance purposes.

Kohl's will own its building, but COR will continue to own the land.

A subdivision carves a parcel of land from an existing parcel to make a new parcel with its own tax ID number.

Kohl's is planning 56,883-square-foot building roughly in the area of the former Lowe's garden center.

Johnson also revealed that Marshall's is planning a store next to Dick's Sporting Goods and said a fourth store is planned for the former Lowe's space, but said she can't mention the name of the store.

Previously, it was reported that the discount chain 5 Below was planning a store for the location.

Town officials are also considering a sidewalk for pedestrians that would connect Batavia Towne Center and Batavia Downs as well as an extension of Richmond Avenue through to Veterans Memorial Drive.

The Town of Batavia Planning Board will hold a public hearing Jan. 7 to consider an application for a subdivision of property in Batavia Towne Center.

The subdivision would make it possible for Kohl's Department Store to own its own property inside the shopping center, much like Target does now.

Kohl's would be purchasing the parcel from COR Development.

In June, the Genesee County Economic Development Center Board approved $1.8 million in new tax abatements for COR (on top of the $4.6 million in tax breaks COR received from GCEDC in 2006), ostensibly to attract new businesses that provide goods or services not readily available in Genesee County.

Kohl's is a department store chain that sells furniture, clothing, bed and bath items and other general merchandise.

The store will be located where Lowe's once had its garden center, just south of the new Dick's Sporting Goods.

To the north of Dick's will be a Five Below and possibly Marshall's; both are discount retailers.

In order for Kohl's to own its own parcel, the property currently owned by COR must be subdivided.

All subdivisions must go through a public hearing, which is a chance for the public to learn the facts of the project relevant to the subdivision and comment on the issue.

The same process was used to subdivide Batavia Towne Center for Target. A portion of the tax breaks secured by COR in 2006 are now applied to the Target property.

While it's possible for Kohl's to apply to transfer tax abatements received by COR to the new parcel, Rachael Tabelski, director of marketing and communications for GCEDC, said the agency has yet to receive an application for the tax abatements from Kohl's.

The hearing will be held at Batavia Town Hall, 3833 W. Main Street Road, Batavia, at 7:30 p.m., Jan. 7. Written comments will be accepted prior to that date.

Today workers just about completed installing the Dick's Sporting Goods sign on the former Lowe's building.

Syracuse-based COR Development received $1.8 million in local tax breaks in order to retrofit the building so Dick's could come to town and compete against existing locally owned sporting goods stores.

One store, Fisher Sports, has already closed because of the preferential treatment given to COR by the Genesee County Economic Development Center.

Dick's is expected to open within a couple of months.

When we e-mailed a series of questions to Steve Hyde seeking more details on the process by which tax subsidies were approved for COR Development to redevelop a portion of Batavia Towne Center, we also e-mailed five questions to Mary Pat Hancock, chairwoman of the Genesee County Legislature.

Under state law, in order for state sales tax abatements to be awarded to a retail development project, a finding must be made that meets a specified requirement. The finding must be made by the Genesee County Economic Development Center Board and confirmed by the chief executive -- in this case, Hancock -- of the government agency overseeing the IDA. 

For the COR project, the GCEDC board passed a resolution finding that the proposed retail project would provide goods and services not readily available to Genesee County residents.  The only confirmed tenant for the space at the time was -- and still is -- Dick's Sporting Goods.

Hancock said she was not available to respond within the deadline set by The Batavian. We received her answer today. Below are the questions we e-mailed and her e-mailed response.

Questons:

1. Did you conduct any independent research to substantiate the board's decision?

2. At the time you wrote the letter, what did you know about the proposed tenants for the retail space? Were the names of all the businesses communicated to you, and if so, was it your understanding that contracts had been signed or whether these businesses were just proposals?

3. On what factual basis did you base your decision to confirm the finding? What is it about the proposed businesses that caused you to reach the conclusion that they would provide goods and services not readily available in Genesee County?

4. What do you say to a comment such as Mike Barrett's, that tax incentives for retail are like "using your own tax money to put yourself out of business"?

5. Should the existing businesses in Genesee County that must now compete against subsidized national chains receive any tax breaks or other mitigation to level the playing field for them?

Hancock's Response:

Dear Howard;

I do appreciate your forthright and direct manner. It is refreshing. Howard, I am going to frame my reply by indicating how I proceeded to educate myself regarding the proposed project. I hope it covers the intent of your request.

The Legislature does appoint the GCEDC Board. We believe they are a group of outstanding citizens with very strong business sense…as demonstrated by their own careers. They are also committed to the economic health of our community, or they wouldn’t be spending hours of their valuable time volunteering on the GCEDC Board.  Because they have a strong business sense, they also have a very strong respect for the law and carefully follow the latest and most accurate legislature and regulations guiding IDAs. I attended the meeting where they discussed the issue thoroughly. At a subsequent meeting they voted in favor of proceeding with the project.

The Legislature has an attorney. It would be foolhardy for me to sign an official letter without checking the legality of the document with our attorney. He is a careful attorney and checks out his information on many levels. He researched the law and provided me with a copy of the statute as recently amended. He also gave me his written opinion as to the requirements of the law and its application to this project. I was assured that we were acting within our legal rights.

The Genesee Economic Development Council (sic) was required to hold a public hearing and make specific findings of fact before awarding incentives, and did so on this matter.   I did attend the hearing and heard a positive presentation and only six persons spoke against the development.

Howard, I remember how that area looked before the development. It was sad. The lack of development in that area did not result in a healthy Batavia downtown. It looks, and is, more vibrant now, not only in that Town of Batavia area, but downtown as well. We hope to keep it that way…and better. I am most hopeful and confident that each step we take to attract new and suitable businesses to our area…will benefit all of us. Howard, I know you and I share the same desire for a successful, livable, and economically healthy community. We may not agree on everything, but our goals are surely the same.

The state law meant to curtail tax breaks by IDAs for retail developments should be defined as narrowly as possible, according to Comptroller Thomas DiNapoli.

If IDAs broadly interpret the law and push through subsidies for projects that should be outside its scope, then reforms may be necessary, DiNapoli said.

"They should certainly interpret it as narrowly as possible," DiNapoli said. "Having not been a Legislator at the time, I can't overly interpret on their behalf the intent. But what I think we'll do with IDAs that are too broadly interpreting that exception is, we'll make recommendations and work with legislators to tighten up that definition, if that seems necessary to curtail the use of IDA incentives for retail."

DiNapoli was in Batavia this afternoon for a meet-and-greet fundraiser hosted by the Genesee County Democrats at Larry's Steakhouse.

Throughout a six-minute conversation with The Batavian, DiNapoli made it clear he doesn't believe IDAs should be, as a general rule, handing out tax incentives to retail projects.

Asked whether retail chains really wouldn't come to a community unless they get tax breaks, DiNapoli said "that probably varies from community to community," but went on to explain the problem, as he sees it, with such IDA incentives.

"The kind of retail projects we've seen in recent years are the kind of projects that in the long term do not promote the kind of job creation and economic development that would really make a lasting difference in a community," DiNapoli said.

"I continue to have very healthy skepticism of the value of such incentives. As we always point out, there is a cost to the communities that isn't fully realized, so it underscores that the kinds of economic development (undertaken) should be of greater significance, more long lasting, have a transformational impact, and retail doesn't really provide that."

In early May, the Genesee County Economic Development Center Board approved $1.8 million in tax incentives for COR Development to remodel the vacant space at Batavia Towne Center formerly occupied by Lowe's Home Improvement.

The package includes a reduction in property taxes and forgiveness of state and local sales taxes on building material and store fixtures.

The state law prohibits IDAs from giving away state sales tax money unless certain findings are made (there is no law that prohibits other tax breaks for retail projects). The potential findings are that the project is in a highly distressed area, is a tourist destination or will provide goods and services not readily available to area residents.

It was on the last exception that the GCEDC board based its decision on. There was no evidence presented at any public meeting to substantiate the finding.

The only known tenant at the time of the vote was Dick's Sporting Goods.

Genesee County has five small retail outlets that sell sporting goods, four of which are locally owned.

Among the arguments put forward by GCEDC CEO Steve Hyde in support of tax breaks for COR is that he needs that Lowe's space filled in order to attract major corporations to projects such as WNY Stamp and the Genesee Valley Agri-Business Park.

"I'm not sure I buy that argument," DiNapoli said. "I'm not in a position to judge that, but that argument is a stretch."

DiNapoli acknowledged that interpretation of the law is largely left up to the local IDAs.

"Even the report we put out every year (on IDAs in NYS), even that is limited by the fact that it's self-reported information," DiNapoli said. "As people have pointed out, IDAs, as well as other authorities in New York, tend to operate with a level of autonomy that I think doesn't provide a maximum opportunity for accountability.

"As you point out," he added, "there are certain exceptions and there certainly there isn't any easy way to clamp down on an IDA that might be too generous in interpreting that exception."

During the "gaggle" (that's what reporters call it) with Gov. Andrew Cuomo following his speech at GCC yesterday, I asked him specifically about Genesee County Economic Development Center providing tax incentives to the retail project at Batavia Towne Center.

In these mini-press conferences, reporters are only given enough time to ask a few questions and it's difficult to ask follow-up questions, so I fumbled through my question (which really should have been a two- or three-parter), trying to cram in as much information into a short time as possible (and it was still a pretty long-winded question).

Another media outlet has reported that Cuomo was critical of the retail tax subsidies given to COR. The quote used: “It wasn’t the smartest investment of money."

The quote, in my view, is being taken out of context.

Here's Cuomo's full response to my question:

Your case is fact specific and I would have to look at the actual facts to see what they did. We had proposed IDA reforms. I believe there are economies that I can find there and I believe there are incidents where you can find it wasn't the smartest investment of money. That's why, that's one of the reasons I like the approach we're talking about here today. It's simple. It's clean. It doesn't have a lot of bureaucratic red tape. It's very easy to administer. Very few government officials required to administer it. So I think it's preferable to a lot of things we've done in the past.

Included in Cuomo's budget was a reenacted law meant to curtail IDAs providing tax breaks to retail projects. I asked Cuomo what the intent of that law was. He said, "Just improve the process and address the kind of abuses you've been talking about." He then said thank you and turned and left.

I didn't report any of this because I didn't find it particularly newsworthy. He couldn't address the specific local issue (hardly surprising, but I had to ask) and his answer to the more general "intent" question referenced my own question, which by his own admission, he didn't know much about. That seemed like a kind of circular logic that didn't make a lot of sense.

However, given that another media outlet used the quote, and though I don't mean to be critical of a fellow reporter, I feel obliged to put the quote in context.

Earlier this week, we e-mailed 10 questions to Steve Hyde about the approval of the COR Development Project. Below are the questions and his responses verbatum.

Q. According to the best available information, at the time the GCEDC board passed the resolution finding that COR's project would provide goods and services not readily available, only one of the proposed tenants was known and two others were in negotiations. How can such a finding be made without a certainty as to the exact tenants? What if COR were to change the tenants to include, say, a liquor store and/or a jewelry store (two business categories well represented in Batavia)?

A. We cannot comment on private negotiations between a developer and prospective tenants.  Like every project that is presented to our board, we have to rely on the information provided to us by the applicant which included a confidential disclosure of not only the known Dick’s project but two additional tenants as well. If the tenants that ultimately reach an agreement with the developer fail to fulfill the new criteria as defined by state law, we would ask our legal counsel for an opinion as to whether the applicant is living up to their end of the agreement and initiate appropriate claw backs. We are confident that COR will fulfill their obligations as they are a reputable developer.

Q. GCEDC has asserted that the COR project is bringing in retail with goods and services not readily available in Genesee County, but there's never been any specific information from GCEDC to substantiate this claim. What exactly is it about the known COR tenants that provides goods and services not readily available in Genesee County? Beyond the assertion, what are the facts to back up the assertion?

A. Again, we are relying on information provided by the applicant that the tenants both know and where private negotiations are occurring will provide goods and services that are not readily available in our community. We confident that COR will fulfill their commitments as it pertains to the GCEDC board’s finding which allows for GCEDC participation in the project under the retail exception as a part of the new state law.

Q. Does GCEDC have any obligation to provide mitigation for the tax breaks given to COR to the existing retailers, be they an independent business such as Batavia Marine or long-standing national chains such as Kmart (which also sells sporting goods)?

A. Any business in the community can submit an application for assistance to our agency and if they fulfill criteria such as the creation of new jobs and investment then they may be eligible for assistance. Our goal is to help businesses create jobs and bring new investment to our community and we stand ready to do everything we can to do that. We encourage businesses to learn more about the incentives provided by our agency. Information about these incentives as well as an application for assistance are available on our Web site at www.gcedc.com.

Q. Calculating from COR's own sales tax estimates, their tenants will generate somewhere in the neighborhood of $26 million in annual sales. On what basis are we to believe that Batavia is a marginal market in need of tax incentives in order to attract these retail businesses? The figures appear to be right in line with Dick's per store gross sales average, which means they should be able to project $500,000 in net annual profit. At that kind of return, do these retail stores really need tax breaks in order to come to Batavia? Aren't the things that make Batavia an attractive place to do business -- centrally located in a large rural area, Thruway proximity, promising economic growth -- sufficient for retail without tax breaks, and if it not, what will keep these business in town when the subsidies run out?

A. The fact that we do not have large retailers like Dick’s indicates that Batavia is a marginal market, however as we grow our economy through projects like Alpina and Muller Quaker and longer term STAMP, we will become a destination market. The fact remains, the developer applied for tax relief to conduct an adaptive reuse and expansion of the property at Batavia Towne Center that will create jobs and new investment in our community and just as important the application submitted fulfills the criteria for retail under the new state law.

Q. According to COR, the stores will invest a collective $11 million in opening their stores. If a retail business is willing to make that kind of financial comment to a community, how can we believe that tax incentives are critical to attracting national retail to Batavia?

A. Think about that for a moment. If you had an opportunity to make a $1.8 million investment over 10 years, which is essentially what our incentive package totals, and the return on that investment was $11 million worth of capital investment, who would not make that deal. On top of that, our investment of $1.8 million is going to be returned in the first year alone based on sales tax revenue generation which will benefit our community and help keep property tax rates down.  Without our assistance, there is no $11 million capital investment and no new sales tax revenue for our community thereby creating additional pressure to raise property taxes which hurt residents and businesses.

Q. GCEDC has asserted that it's bad for the community and bad for attracting business to have Lowe's vacant. In the time since it's been vacant, GCEDC has landed two major tenants and is about to land a third for the Genesee Valley Agri-Business Park. What evidence is there that a vacant Lowe's hurts business development?

A. When both Alpina and Muller Quaker were touring the area, the Lowe’s store was in fact still open which showed the companies that we did in fact have a vibrant retail center immediately located off of the I-90. Moreover, we are trying to take a holistic approach to economic development here in our community. You seemingly are taking the view that the Lowe’s vacancy does not “hurt” business development; we take the view, based on our years of experience in the company attraction business, that a vibrant retail center located at the gateway of our community enhances our ability to attract companies to our community in this very competitive world of economic development.

Q. GCEDC has asserted that it's bad to have a vacant Lowe's, but COR has said that it's bad for the rest of Batavia Towne Center to have a vacant Lowe's. Doesn't COR have a strong motivation to lease that space even without tax abatements?

A. I don’t want to single COR out; they are a prominent developer and like many developers they have options and choices as to where to lure their retail clients. Our decision was based on an application that our board believes fulfills the criteria under the new state law specific to retail projects. We believe the return on investment that will be generated through the tax assistance provided will create a vibrant towne center.

Q. What do you say to a comment such as Mike Barrett's, that tax incentives are like "using your own tax money to put yourself out of business"?

A. Alpina and Muller Quaker and the related economic benefits would not have occurred without the incentives being provided through the GCEDC. To the contrary, we are using incentives to create new jobs and new wealth and subsequently new tax revenues to make our community more prosperous and an even better place to work, live and play. I can assure you that Alpina and Muller Quaker are not putting local dairy farmers out of business.

Q. Based on our polls and nearly daily discussions with people in our community, it's difficult to find local residents who support tax breaks going to COR. Is it appropriate for GCEDC to go against the wishes of the vast majority of Genesee County residents on such an important issue?

A. Genesee County has a population of approximately 60,000 residents. A public hearing was held in the evening which was open to the public; about 30 residents attended and six spoke against the project during the hearing. One letter was received at the offices of the GCEDC opposing the project and was officially included in the transcripts of the hearing. The board was provided a written copy of the transcripts from the public hearing prior to voting to approve the adaptive reuse and expansion project at Batavia Towne Center. I think if we were to start relying on polling that admittedly in not statistically accurate and to use that data to make decisions about economic development, you would not see many businesses even contemplating coming to our community.

Q. Will GCEDC continue to have a policy of providing tax breaks to retail projects even though there is a significant body of research that shows tax incentives to retail have no tangible return to local communities and even though the vast majority of Genesee County residents oppose such tax breaks?

A. The GCEDC as a matter of practice does not pursue retail projects. This is evidenced to our not participating in the Tim Horton’s project locating at the west end of Batavia and the McDonald’s project planned for Aldi plaza in the City on the east end. We will continue to comply with state law while advancing our vision and mission to provide a positive place to do business for all companies. There is a significant body of evidence that shows there is a tangible return to local communities. To claim that the “vast majority” of residents oppose such tax breaks is subjective at best without any real statistically accurate information to substantiate such a claim.

Jim Rosenbeck, a member of the Genesee County Libertarian Committee who's planning a run for an at-large seat on the City Council, submitted this response to Steve Hawley's defense of the COR Development tax breaks:

I often agree with Steve Hawley, as Libertarians often do, when republicans champion fiscally responsible positions. But that wasn't the case on May 17th. That day, Mr. Hawley put out a press release lauding GCEDC's successful effort to offer abatement of taxes to COR Development. COR will in turn use those subsidies to offset costs of remodeling their property in the Batavia Towne Center in order to fit the needs of the next tenant, Dick's Sporting Goods. In exchange for tax abatements approaching 2 million dollars, we are promised new local jobs and additional sales tax revenue.

As I recall, we heard that same promise once before when COR received six million dollars in tax abatement to develop their property for among others, the long gone Lowes Corporation. So now, we double down on our bet, while we hope and pray that Dick's Sporting Goods delivers as COR has promised. But let's look a bit closer at these promises. Is COR or Dick's promising full-time jobs? Are they full-time jobs that also pay a living wage? No, of course they aren't. During their public hearing COR talked in terms of full-time job "equivalents." That is corporate double talk for part-time and low-wage jobs, the kind of jobs that are fine for students but don't work so well for single moms who need to pay the rent. That is the dirty little secret that COR won't tell you and Dick's won't tell you, and sadly on May 17th, Steve Hawley also neglected to tell you. To add insult to injury the most handsome job created by GCEDC goes to the guy with the greatest vested interest in perpetrating the illusion of quality jobs. Yes, the best job that GCEDC has created to date is the one that is held by its President and CEO Steve Hyde.

But let's not forget the promise of sales tax revenues. Are we significantly increasing the size of the sales tax pie by subsidizing the development of Dick's Sporting Goods? I wonder. I would like to know what portion of any sales tax revenue produced by Dick's would still have been realized from a similar sale at Olympia, T-Shirts Etc., Barrett's or perhaps Fisher Sports. No one knows. For COR to promise significant increases in tax revenues is at best speculative and certainly self-serving. We should remain skeptical whenever we are promised sales tax revenue and jobs with one hand while the other hand lobbies our County Legislature for nearly a quarter of a million dollars for its own funding next year.

Growing government through Economic Development Corporations (EDCs) in order to address the problems created by big government....high taxes, over regulation, cumbersome bureaucracy is simply counter intuitive. Our economic problems are systemic. They are symptomatic of a state government gone awry. I am unwilling to accept that the answer to big government is to create a whole new bureaucracy with a CEO making close to a quarter of a million dollars a year. We need to stop creating the good jobs on the backs of the taxpayers  while promising a small sliver of the pie to the people who pay the bills. I am not ready to pretend differently. I am not ready to concede hope that we can do better. What we need is more truth and transparency in our government, not more promises that may or may not be kept. I agree with Steve Hawley much of the time. This time, I don't.

Press release:

Assemblyman Steve Hawley (R,I,C-Batavia) recently voiced his support for the Genesee County Economic Development Center (GCEDC) and its successful efforts to attract a Dick’s Sporting Goods store to Towne Centre Mall in Batavia. The group was able to secure the store’s move through pro-business tax incentives, which will create local employment opportunities and increase sales tax revenue to support local programs and services. Hawley defended GCEDC against attacks from Buffalo-area Assemblyman Sean Ryan, who has publicly criticized the local economic development effort.

“Here in Batavia and across Genesee County, we deserve access to both consumer choice and employment opportunities. By attracting Dick’s to Towne Centre Mall, GCEDC has helped bolster both,” Hawley said. “Assemblyman Ryan’s attacks on our local economy are completely uncalled for. While he purports to be concerned with the use of state tax dollars, surely he would agree that one of the highest-taxed states in the nation has bigger fish to fry than Genesee County’s legal ability to strengthen its own economy. I believe it is in the best interests of all involved that assembly members focus on their own constituents and that he focuses on revitalizing Buffalo’s economy.”

“The GCEDC was created to help increase the tax base, create new jobs as well as bring new investment and revenues into our community. This project fulfills all of these criteria and without our assistance, these benefits would not be realized,” said Steve Hyde, president and CEO of the GCEDC. “The project will create jobs, increase sales tax revenue, bring new goods and services into the community, and reinvigorate what is currently a large, vacant space located at the gateway of our community off of I-90.”

Hawley noted the crucial role the GCEDC has played in attracting job creators to Genesee County and keeping them here long-term.

“Between the Genesee Valley Agri-business Park, Oakta Hills and countless other projects, GCEDC has long been at the forefront of job creation and economic development in our community,” Hawley said. “Throughout my time in the Assembly, we have worked diligently to revitalize our local economy, and GCEDC has my full support in its effort to bring jobs to our community.”

Press release:

“The Genesee County Economic Development Center requested and received a legal opinion regarding the approval of tax incentives for the COR Development project in the Town of Batavia as well as whether the project is legally exempt from new retail provisions recently passed into state law.

“We are pleased to announce that this opinion supports the recent vote by our board to approve these incentives as well as the exemption to the new law.

“The GCEDC strongly believes that this project will bring goods into the community that are not currently available to area residents. It should be noted that other tenants also will be opening in near future providing residents with other goods and services in what is currently a large vacant space located at the gateway of our community off of the I-90.”

“More importantly, the sales tax revenues that will be generated in just one year will be more than the incentives provided to the developer. The GCEDC was created to help create new jobs as well as bring new investment and revenues into our community. This project fulfills all of these criteria and without our assistance these benefits would not be realized.”

Downoad: PDF of Attorney's Letter.

Was the Genesee County Economic Development Center Board of Directors' decision to provide $1.7 million in tax abatements to COR Development legal?

That depends on who you ask.

A Buffalo assemblyman thinks the GCEDC board violated provisions of the 2013-14 budget act, which attempts to curtail state sales tax abatments for retail projects.

Assemblyman Sean Ryan is asking for an investigation by the state's tax commissioner, but when The Batavian contacted Taxation and Finance Department last week, it took awhile to get a response and when we did, the agency passed the buck to the state's Budget Office.

So far, no state agency has expressed much interest in taking a closer look at GCEDC's actions.

At issue is a resolution passed by the GCEDC board that found COR's proposal to redevelop the former Lowe's location in Batavia Towne Center meets the necessary legal requirements to receive state aid.

Specifically, under terms of the law, an IDA cannot provide relief on state sales tax without making certain findings. Among the possible findings are that the project will serve as a tourist destination or that it's in a highly distressed area.

The finding for the COR project by the GCEDC board was that the project provides goods and services that are not readily available to local residents from current retail stores.

At the time the board passed the resolution, the only publicly announced tenant for COR's project was Dick's Sporting Goods.

Last week, at a Town of Batavia Planning Board meeting, it came out that Kohl's is a likely tenant.

There may be at least one other, and possibly a fourth, tenant, but there's no reliable indication of who those tenants might be.

Today, GCEDC Chairman Charlie Cook said at the time of the vote, the board had been given two other names, but acknowledged negotiations were still under way between the retailers and COR at the time of the vote. There is no guarantee that those retailers will be the ones to eventually occupy the space.

The big question is whether Dick's meets the requirement under the law for providing goods and services not readily available in the local market.

Ryan has pointed out -- as most Genesee County residents know -- there are four sporting goods stores in Batavia. There are also three department stores that sell sporting goods.

Cook said he's not much of a sporting goods shopper and is largely unaware of the type of merchandise carried by Dick's or what local retailers might offer that is similar or different.

"I feel the input that I had from the people in the community was that having Dick's here would be a huge draw for the surrounding area, and I guess that's something people will always have a differing opinion about," Cook said.

Prior to approving the COR abatements, the GCEDC conducted a public hearing on the project, as required by law.

COR VP Joseph B. Gerardi made a presentation about the project at the hearing, but no GCEDC staff covered the agency's position on the project. 

The pending resolution, with its key finding about the uniqueness of the project, was not made available by GCEDC staff at the meeting or prior to the vote by the board the following Thursday.

In other words, the public had no opportunity to review specifically what the board would vote on and comment on it.

State law enacted in 2012 requires "to the extent practicable" that resolutions to be voted on be made available to the public prior to the meeting.

We requested an interview with GCEDC CEO Steve Hyde this afternoon, but he was tied up in meetings and unavailable.

After the May 2 vote approving package of incentives, The Batavian began making inquiries trying to find out who, if anyone, would enforce the IDA law if there was any question about its application for a retail project.

We found press offices with state agencies willing to provide information "on background," but nobody willing to provide on-the-record information about the law and how it's enforced, if at all.

One exception was the Comptroller's Office, where spokesman Bruce Butry was willing to be as helpful as he could be.

The Comptroller's Office could conceivably audit the GCEDC and even focus on this specific project, but an audit would merely result in a written report, leaving it up to the County Legislature to act, or not, on any findings.

"At the end of the day, it's up to the people in the local community," Butry said. "Some of these IDAs operate with very little accountability other than the pressure put on the boards by the public regarding the types of projects they're going to approve."

The Governor's Office had no on-the-record comment about the law or the local situation.

Butry suggested we try Taxation and Finance. Once we reached the right person, he was very friendly, but he said it was up to the state's Budget Office to answer any questions about the law.

In response to a long list of e-mailed questions, Morris Peters, spokesman for New York State Division of Budget, provided some information "on background," and this statement for publication:

“Under these reforms, grocery stores will no longer be given tax breaks to move across the street. Tax dollars will be focused on those industries that create jobs and companies who will move to New York to help build our economy.”

Assemblyman Steve Hawley, who represents Genesee County, isn't surprised that Albany is keeping this issue at arm's length. He believes the decisions to provide abatements is a local issue and should be considered beyond interference from state agencies.

"I try not to meddle in local decision-making because there are too many people who do, like Mr. Ryan," Hawley said.

In response to Ryan's making public statements about the COR abatements, Hawley and Sen. Mike Ranzenhofer, who also represents Genesee County, were trying to organize a press conference for tomorrow to highlight the successes of GCEDC and invite Ryan to take a closer look at the agency, with an eye toward how he might better help his own constituents in the City of Buffalo achieve greater economic prosperity.

Scheduling conflicts may prevent that press conference from taking place.

Earlier today, Ryan and Hawley had a brief phone conversation in which Hawley said he asked Ryan, "Have you moved to Genesee County?"

When Ryan returned a call to The Batavian, he said, "I understand some people there are upset with me."

But Ryan said it was legitimate for him to call into question the GCEDC giveaway of state tax money because it affects his constituents, too, as it does all taxpayers in the State of New York.

"It all goes back to this: whose tax dollars are they handing out?" Ryan said. "Those tax dollars belong to every taxpayer in the State of New York."

A cynic might think that Ryan's real motive is to keep Dick's Sporting Goods out of Batavia so that Genesee County residents continue to drive to Erie County to shop.

Ryan said, "You could say that, but you should say he wants high wage jobs so that people can raise families and that we should use our scarce revenue to bring in those high wage jobs, not low-paying retail jobs that require people to draw on Medicare and food stamps because the wages are so low. That's not good for our economy and that's not good economic development."

To Ryan's point, the Comptroller's Office has a long history of taking a critical look at IDAs, even before Thomas DiNapoli held the office, particularly in the area of tax abatements for retail projects.

The current law attempting to curtail tax breaks for retail projects is based on a similar law that the state Legislature allowed to expire in 2008.

In 2006, the Comptroller's Office issued a report looking at implementation of the law and found that IDAs found creative ways to skirt it.

(The) exceptions, all of which are applied at the discretion of local IDA boards, can make the retail prohibition ineffective.

Since the application of these exceptions is determined at the discretion of each IDA, these criteria are sometimes subject to expansive interpretations.

The examples given were out of Erie County and included "tourism destination" designation for projects because they were located near an airport or Thruway exit.

Last week, the office again issued a report on IDAs and included a discussion of why it's important to curtail tax breaks for retail projects.

Retail projects generally do not increase the level of jobs available in a region or economic activity, as project-related gains often come at the expense of other retail enterprises in the area, and the jobs associated with retail trade tend to pay significantly less than manufacturing or other professional jobs. The restriction on retail projects was reinstated in the 2013-14 State Fiscal Year Budget, indicating that State policymakers understand the limited usefulness of these projects for economic development.

And ...

Very few of the IDAs sponsoring retail projects reported the estimated salaries of the jobs to be created, but data from the New York State Department of Labor shows that the average starting salary for a retail salesperson is $17,250, while the average for first line retail supervisors is $28,720.

IDAs, Ryan said, have become "subsidy machines."

"COR gets these subsidies from Buffalo to Syracuse," Ryan said. "They've figured it out. They know they can come to these IDAs and have their project viewed favorably because they say, 'see what a great thing we're doing for the community,' and everybody can say they're a part of it. The politicians run for election and stand in front of the place and say, 'look at what we brought here.' "

Ryan doesn't even believe it's about the commission check GCEDC will get for the project, which could total $100,000. It's about looking good, he said.

Even if Ryan is successful -- and Hawley doubts anybody in Albany will take serious an out-of-district assembly member calling for an investigation -- in getting the tax commissioner to look at the project, it's unclear from the IDA law what power, if any, the commissioner has to overturn a local decision.

Here's the relevant section of the law:

The commissioner is hereby authorized to audit the records, actions, and proceedings of an IDA and of its agents and project operators to ensure that the IDA and its agents and project operators comply with all the requirements of this section. Any information the commissioner finds in the course of such audit may be used by the commissioner to assess and determine state and local taxes of the IDA's agent or project operator.

And even if the commissioner can recapture the tax revenue, Butry, from the Comptroller's Office, said it only applies to the state sales tax incentive.

COR received a tax break on state and local sales tax for the purchase of building material, as well as a revised PILOT (Payment in Lieu of Taxes) on the increased assessment and mortgage tax relief.

Ryan agrees that there is no provision in the law for anybody in Albany to overturn the PILOT, the local sales tax or mortgage tax abatement. Those are entirely local decisions.

At the public hearing, Gerardi said the local share of sales tax revenue from the project would be $1 million.

Using that as a base for calculation, that puts projected annual gross revenue at build out at about $26 million.

Gerardi said the retailers coming into the project would invest $11 million.

Those don't sound like numbers, Ryan said, of companies that need tax incentives to build retail projects and create a playing field that isn't level for existing retailers.

Charlie Cook said he truly believes that in a small market like Batavia, big retailers won't come here without a reduction in their operating costs.

"You hate to see that big empty building just sitting there," Cook said. "They are offering an opportuinty to fill it with something that is vibrant and exciting and has the potential to draw in outside people."

Mike Barrett of Batavia Marine and Kurt Fisher of Fisher Sports have said they believe they can compete with Dick's on quality and service and Cook said he is hoping that is true.

"As you pointed out, these businesses have proven to be resilient and able to find niches and services that continue to make them very successful," Cook said. "That's my hope, that everyone is going to be a winner in the long run."

Cook said he and the GCEDC board are just trying to do the best they can for the community and there's no intent to subvert the law.

"We're a board of volunteers and the one thing we're interested in is promoting business development in Genesee County," Cook said. "That's our only motivation to sit on the board and when those opportunities come up, we embrace them."

As to any legal concerns raised by Ryan, Cook said that GCEDC has asked its attorneys to review Ryan's assertions, but Cook also said that prior to the board's vote, legal counsel assured the board that the action it was about to take was legal and proper.

"We're not out to push anything through that is improper," Cook said. All the information we had said it was perfectly proper and I guess at this point, we'll defend that. If it turns out that it wasn't, we'll review our policies and not do that anymore."

All five members of the Genesee County Economic Development Center Board present for today's meeting voted yes on $1.8 million in tax breaks for COR Development to help the Syracuse-based company bring national retailers, such as Dick's Sporting Goods, to Batavia.

Legislator Shelly Stein, who sits on the GCEDC board, praised COR for all it's done for local schools and the community by generating new tax revenue.

While she said she agrees with much of what speakers said at Tuesday's public hearing on the proposed abatements, particularly about the current state of affairs in New York, she considered the proposed development a "great win for the county, the town and the city." 

New York's high tax rates, she said, makes such incentives necessary.

"I thank you for bringing this project forward," she said to COR VP Joseph B. Gerardi. "That 18 million of investment, and not asking for that PILOT to restart at zero and start at 40 percent, makes a lot of sense for us."

Board Member Jim Vincent said that clearly the public doesn't understand what GCEDC does.

"The public comments signify that we've still got a way to go to convince the populace of Genesee County about what we do and why we do it," Vincent said. "I appreciate projects like this coming forward because in my opinion just the sales-tax factor alone adds an annuity to reduce the tax burden on every business, farm and family that resides in Genesee County."

No other board members spoke.

After the vote, GCEDC CEO Steve Hyde thanked the board for approving the project.

"Just to remind everybody that inside the resolution, the predominate finding was that this was a unique facility project to meet the retail restrictions under the law," Hyde said. "This is the only 36-acre major shopping center inside this entire county. As the law states, this is the opportunity to bring more, varied shopping offerings and services to the community and without this particular project, as the law states, the availability of these broader services and offerings would not be readily accessible to the residents of the community.

"Hence, that was really the underlying basis of the retail restriction and the request for the board to consider, because at the end of the day, we're trying to attract large-scale, tech-driven manufacturing here. ... The last thing you want to do is have a large, empty building while we're showing our community."

John L. Rizzo and Mary Ann E. Wiater were not present at today's meeting.

Voting yes were Stein, Vincent, Charlie Cook, Wolcott T. Hinchey and John F. Andrews.

COR estimates that the four possible tenants -- which COR has previously confirmed includes Dick's Sporting Goods -- will generate more than $16 million in annual gross sales and the four tenants will likely invest $11 million to get their stores open.

After the meeting, walking down the hall, we tried to ask Gerardi why $1.7 million in tax breaks are necessary when the revenue estimates and total capital investment indicates there is market demand for the project. He said questions needed to be directed tomorrow to the company's CEO, Steve Aiello, and made a sharp left turn into the men's room.

Aiello has not previously returned calls nor answered e-mails from The Batavian.