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Friday, May 17, 2013 at 6:57 pm

Hawley defends GCEDC's tax breaks for COR Development

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.”

Friday, May 17, 2013 at 4:05 pm

GCEDC attorney says COR Development subsidies perfectly legal

post by Howard B. Owens in Batavia Towne Center, COR Development, GCEDC

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.

Thursday, May 16, 2013 at 11:52 pm

Questions linger about legality of GCEDC's approval of COR Development tax breaks

post by Howard B. Owens in Batavia Towne Center, COR Development, GCEDC

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."

Monday, May 13, 2013 at 11:55 pm

Video: Buffalo TV station airs lengthy piece on salary paid to GCEDC CEO Steve Hyde

post by Howard B. Owens in business, GCEDC
Here's WGRZ's report on the compensation paid to Steve Hyde, CEO of GCEDC.
Friday, May 10, 2013 at 11:33 am

GCEDC announces public information session

post by Howard B. Owens in business, GCEDC

Press release:

Genesee County Economic Development Center (GCEDC) officials will hold a public information session on June 4 from 7 to 9 p.m. at the MedTech Center Building, located across from Genesee Community College (GCC) in Room 214. GCEDC officials are encouraging residents to attend the meeting to learn more about how the GCEDC fosters economic development in Genesee County.

Mark Masse, senior vice president of operations for GCEDC, will provide an overview of the organization, the incentives they offer, and how a potential company can be attracted to our community. A question and answer period will follow the presentation.

“This is a great opportunity for residents as well as local businesses to learn more about  how our organization enhances economic growth in Genesee County,” Masse said.

Because the seating capacity is limited to about 100 persons, GCEDC is requesting that those interested in attending to please contact Rachael Tabelski, marketing and communications manager at GCEDC by calling 585-343-4866, ext. 12, or sending an e-mail to rtabelski@gcedc.com.

Friday, May 10, 2013 at 8:27 am

GCEDC paving way for possible medical device technology company at Med-Tech

post by Howard B. Owens in batavia, Alabama, bergen, business, Darien, GCEDC, Oakfield, Stafford

Genesee County Economic Development Center is trying to get initial permitting completed on a proposed expansion of the Upstate Med-Tech Center on R. Stephen Hawley Drive just in case a specific medical device technology company wants to lease the space.

Mark Masse, VP of operations for GCEDC, told the County Planning Board on Thursday that a contractor has a potential leasee and is in negotiations now. Getting certain regulatory hurdles cleared now would help the process.

"If they reach an agreement, the potential leasee is working on a tight time frame," Masse said.

Masse doesn't know yet how many new jobs could be created by the company.

"They haven't gone before the board yet for incentives from us," Masse said. "More information would be available at that point in time, if it gets to that point."

The planning board unanimously approved site plan review for proposed 60,000-square-foot facility.

The board also unanimously approved a site plan review for a proposed 60,000-square-foot cold storage facility at the Genesee Valley Agri-Business Park.

Masse said GCEDC still owns the property the unnamed company is considering for the facility and sales negotiations are ongoing.

That company also has yet to come to the GCEDC board seeking incentives, so Masse doesn't know yet how many new jobs will be created by the facility.

In other board action:

  • Did not approve variances for applicants to operate a gift and hobby shop on Knowlesville Road, Alabama, and a country store on Tesnow Road, Alabama. The board encouraged the applicants to seek a zoning change with the town rather than get a variance to existing zoning.
  • Approved a special use permit for a home welding business at 7460 Alleghany Road, Alabama.
  • Declared that a proposed boarding house at 316 E. Main St., Batavia, isn't subject to county planning review. Owner Terry Platt is looking to convert a single-family home into a 12-room boarding house.
  • Approved subdivision and site plan review for 7,015-square-foot building to house a gun store, laser engraving business and indoor shooting range at 8240 Buffalo Road, Bergen.
  • Approved site plan review to rebuild a fabrication business at 1606 Broadway Road, Darien.
  • Approved, with modifications, a site plan review and area variance for a new Dollar General at 111 N. Main St., Oakfield.
  • Approved a site plan review for conversion of a former restaurant and apartment complex at 6309 Clinton Street Road, Stafford, into a four two-bedroom apartment and a single one-bedroom apartment complex.
Thursday, May 2, 2013 at 6:17 pm

GCEDC board passes tax breaks for COR Development unanimously

post by Howard B. Owens in batavia, Batavia Towne Center, business, COR Development, GCEDC

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.

Tuesday, April 16, 2013 at 10:02 am

GCEDC reschedules COR public hearing to accommodate requests for evening meeting

post by Howard B. Owens in batavia, Batavia Towne Center, business, GCEDC

Press release:

The Genesee County Economic Development Center (GCEDC) announced today that the public hearing on the COR Development project application, originally scheduled for Tuesday, April 23rd at 4 p.m., has been rescheduled to April 30th at 7 p.m. to accommodate requests for the meeting to be conducted outside of normal business/working hours.

“The GCEDC strives to be a transparent and accommodating agency so when we get these types of requests we do everything we can to honor them,” said Charlie Cook, GCEDC board chairman. “It’s evident that this project has generated quite a bit of interest so we want to make sure that the community has the opportunity to learn more about the project and have their voices heard.” 

At the meeting, the GCEDC will provide a comprehensive overview of the project – including the benefits COR Development is applying for to develop the vacant Lowe's building – as well as a full disclosure of the fiscal and economic impacts the Batavia Towne Center has had on the surrounding community since it came to fruition. Following the presentation, the hearing will be open for public comment; the GCEDC also will read any written comments received by the agency prior to the public hearing.

Written comments can be sent to the GCEDC’s Marketing and Communications Director, Rachael Tabelski at Genesee County Economic Development Center, 99 MedTech Drive, Suite 106, Batavia, NY 14020.  Written comments must contain the individual’s contact information, including address and phone number, and should indicate if he or she would like the comment read at the hearing. All comments and public hearing testimony will be reviewed by the GCEDC board prior to a vote on the COR Development application for support.

Thursday, April 11, 2013 at 5:19 pm

Public hearing set on incentives for COR Development

post by Howard B. Owens in batavia, Batavia Towne Center, business, GCEDC

A public hearing has been set for COR Development's request to receive financial assistance to renovate the former Lowe's location in Batavia Towne Center.

UPDATE 7:40 p.m.: The hearing has been rescheduled. It is now at 4 p.m. April 23 at Batavia Town Hall. (It was previously set for April 22.)

COR is seeking nearly $1 million in tax incentives for the project.

Thursday, April 4, 2013 at 10:06 pm

Petition drive started to protest further tax incentives for COR and Dick's Sporting Goods

post by Howard B. Owens in batavia, Batavia Towne Center, business, GCEDC

Press Release from Phil Ricci, chairman of the Gensee County Libertarian Committee:

Dick's Sporting Goods also does not expect to win, or ask for, tax abatements to expand here. "Our goal is to deliver everything at the lowest price," Hennion said. "We really don't feel like we should be using customers' money to build our stores."

That was a direct quote from the VP of Dick's Sporting Goods!

The classification of the Batavia Towne Center as a "tourist destination" is laughable at best, and a complete deception regardless. More than $6 million dollars has already been promised to COR over a 10 year period. Yet even though the company did not complete many of the promises within the original project, they are asking for an additional $ 1 million in "tax incentives" to re-fit a previously failed space!

No tax payer should be asked to subsidize a multi-billion dollar retail chain, so they can do business in their town, but what's even worse is when that retailer is not asking for the help!

Stop the abuse! Tell Mary Pat Hancock and the GCEDC Board to not approve the additional funds!

Sign the petition: http://www.thepetitionsite.com/706/682/307/stop-the-additional-funding-of-tax-incentives-to-cor-for-dicks-sports/

About the Genesee County Libertarian Committee: Advocate. Educate. Choice. The Genesee County Libertarian Party. For more information, please join us on Facebook @ https://www.facebook.com/GCLP.NY.
Also Please join us for our first fundraiser, April 13th at Batavia Downs! http://thebatavian.com/lisa-ace/sponsored-post-celebrate-liberty-night/36799
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