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."

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.

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.

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.

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.

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.

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/

NOTE: There was a big mistake in the original headline of this post about the amount of property taxes that would be generated over 10 years.  The correct number is $4.3 million, not the significantly higher number previously quoted.

Batavia Towne Center, in the four years since the first stores opened there, has generated more than $500,000 in new property tax revenue for schools and county government.

It's also generated more than $500,000 in new fire tax revenue for the Town of Batavia.

We don't know how much sales tax it's generated because those figures are considered confidential. But COR Development estimated -- when it applied to GCEDC in 2006 for tax abatements for the project -- that at build-out, the center would add more than $4.5 million in annual sales tax to the state and county treasuries.

Under the current terms of the agreement between COR and the Genesee County Economic Development Center, Batavia Towne Center will generate an estimated $4.3 million in property tax and fire tax revenue by 2018.

COR is asking that the original agreement be modified to help the company attract Dick's Sporting Goods along with one or two other retailers to the former Lowe's location.

There are three tax abatements under consideration:

• $180,000 sales tax exemptions
• $43,750 mortgage tax exemption
• $828,390 property tax exemption

Before there was a Batavia Towne Center there was 47-acre parcel of land that didn't have much on it except for the Wood Hill Trailer Park off Park Road that -- according to a June 22, 2006 article in the Batavia Daily News -- was filled with aging trailers that once housed race jockeys from Batavia Downs.

The total assessed value in 2008 was $1.6 million.

After Batavia Towne Center opened, the assessed value jumped to $14.5 million.

Under the terms of the original agreement with GCEDC, COR received a $6 million tax incentive package:

• $2,078,400 sales tax exemption
• $312,500 mortgage tax exemption
• $3.6 million property tax exemption

COR was planning a 375,000-square-foot shopping plaza that would be anchored by Target and Lowe's with Bed, Bath & Beyond, PetCo and Michael's, as other key tenants.

It would cost COR an estimated $40 million to build the center.

COR estimated at build-out the stores would employ 364 full-time equivalents (FTEs), who would be paid $9.9 million in annual wages, and the stores would generate $4.6 million in annual sales tax on $667 million in gross annual sales.

In 2007, the project was split into two parts, because Target insist on owning the building and real estate of their own stores, so the benefits and liabilities of the project are now split between COR and Target.

For the life of the agreements, both COR and Target are required to submit an annual report to GCEDC on employment.

By the time all of the stores were open in 2009, COR and Target reported a combined 365 FTEs.

As the economy declined after 2009, so did employment, dropping to 341 FTEs in 2011.

After Lowe's closed, the number of FTEs dropped to 270 in 2012.

The bulk of the incentive package for COR (all numbers in this story roll up COR and Target as if it were still a single project) was the property tax abatement.

The abatement is known as a PILOT (payment in lieu of taxes). 

A PILOT is designed to forgive a portion of property taxes on the increased assessed value on a parcel of real estate that are the result of improvements.

In the case of Batavia Towne Center, as stated above, the property's assessment rose from $1.6 million to $14.5 million.

COR continued to pay property taxes on the original $1.6 million assessed value, but in 2010, when the assessed value jumped so dramatically, it paid no property taxes on that additional $12.9 million in assessed value.

Under state law, fire district taxes cannot be waived, so when the assessed value jumped, so did the amount COR pays for fire services in the Town of Batavia.  Currently, COR and Target pay more than $266,000 annually in fire protection taxes.

Starting in 2011, COR began paying taxes on 20 percent of the increased assessed value, or on $2.6 million of the new additional assessed value.

This year, COR's share jumps to 40 percent of the assessed value.

By 2017, COR will be paying 80 percent of the increase in assessed value and the PILOT expires in 2019, at which point, COR and Target will be paying property taxes on 100 percent of the increased assessed value, or about $4.1 annual in property taxes.

The bulk of those taxes go to the school district with the rest going to the county.  The Town of Batavia currently has a zero property tax rate.

The projected numbers are based on the current assessed value, which is subject to change annually.

For the exemption of the center to accommodate Dick's and other retailers, COR is asking for the PILOT to be amended to cut the taxes on the new assessed value of that portion of the project.

Currently, the portion of the property that contains Lowe's is assessed at $6.9 million.

The improvements will increase the assessment to an estimated $8.6 million.

COR is asking for an amended PILOT just for that parcel that will begin at the 40 percent of increased assessment value and extend the life of the PILOT (just for that parcel) through 2024.

Rather than going up 20 percent every two years, the 40 percent of assessed value would last for three years, then go up to 50 percent for two years, 60 percent for two years, 70 percent for two years and 80 percent for two years.

In 2007, as we reported earlier, the project was only eligible, as a retail project, for tax incentives, because it was declared a "tourist destination."

Under terms of IDA law, a tourist destination is defined as a location that will attract a significant amount of traffic from people living outside of the IDA's service area.

In this case, from outside Genesee County.

The agency also had to find that the project would offer a service not otherwise available to county residents.

In a June 8, 2007 letter, COR's VP and attorney Joseph B. Gerardi, wrote in a letter to Steve Hyde, CEO of GCEDC:

It is anticipated that the Towne Center will provide economic and/or tourism opportunities for commercial uses not otherwise readily available to residents of the Genesee County Economic Development Region. ... The Towne Center project is also anticipated to retain a significant percentage of the retail sales available in the Economic Development Region that is likely to be leaving the Region, and create additional economic development activity. This is a result of the potential for Towne Center to attract retail sales from counties that are in near proximity to the Region and/or development.

Legislature Chairwoman Mary Pat Hancock wrote in a letter dated Jan. 2, 2007:

In order to assist the Agency in making such a finding, the Company has represented that the Project is the sole comparably-sized shopping center available to residents of Genesee County and therefore provides a service that would otherwise be unavailable.

Hancock's letter did not address the "tourism destination" designation.

While the project was in development, GCEDC was apparently interested, according to a February, 2007 article in the Batavia Daily News, in adding a multi-screen theater to the project.

COR seemed less than thrilled with the idea, noting that adding theaters would mean less parking, and theater patrons would take up a lot of parking spaces that would otherwise be filled with store shoppers.

The original project proposal also promised restaurants, but none of have been built in the plaza.

COR also promised to plant $200,000 in trees in the parking area.

It's expected that if GCEDC is to grant new tax incentives to COR for Dick's Sporting Goods and other additional retail space, the project will need to be approved as a "tourism destination" and provide goods and services not otherwise available in Genesee County.

In 2005, while discussing sports retail outlets in Forth Worth, Jeff Hennion, then VP of strategic planning for Dick's Sporting Goods, told the Star-Telegram that Dick's wasn't interested in tax incentives for their stores.

"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."

UPDATE: Original site plan map added, courtesy COR Developerment.

Batavia Towne Center -- the location of Target, Bed Bath & Beyond, Michael's, Petco and Radio Shack -- is a tourist destination.

It became a tourist destination in 2007 when the board of the Genesee County Economic Development Center voted to proclaim it a tourist destination and Mary Pat Hancock, chair of the Genesee County Legislature, gave the designation her stamp of approval.

Without the designation, the GCEDC could not have awarded -- under state law at the time -- some $4.5 million in tax breaks for COR Development Company to build the retail shopping center.

The law lapsed in 2008, but is back in force this year, just in time for COR to request another $1 million in tax incentives to help lure Dick's Sporting Goods to Batavia.

The Buffalo News reported on the revival of the law last week, noting that it's the intention of the governor's office to crack down on tax incentives for purely retail projects.

Those retail projects were magnets for controversy because critics said they did not generate new wealth within the region, served a strictly local clientele and favored one business over others that were fighting for a piece of a shrinking local retail market.

Among the exceptions to the law banning tax incentives for retail projects is the declaration that the project is, or is part of, a "tourist destination."

The statute is pretty clear that Albany wants these incentives going only to retail projects that will likely "attract a significant number of visitors from outside the economic development region ... "

Who decides if a project is a tourist destination? According to the Govenor's Office, it's purely a local decision.

It's up to the GCEDC board to conduct a public hearing on the topic. After the public hearing, the board votes. If it votes to declare the project a "tourist destination," there's one last step, and that's for the chair of the governing agency -- in this case, Mary Pat Hancock of the County Legislature -- to approve the designation.

There's no other process to confirm the designation nor appeal the decision.  There's nothing in the statute that allows another authority to overrule the local decision.

For her part, Hancock seems quite convinced that Batavia Towne Center is a tourism destination.

Hancock noted that Batavia Towne Center is right next to the Clarion Hotel, with its new water park, conveniently located near the Thruway and there are lots of hotels in the area. Those hotels bring families to town for hockey tournaments and soccer tournaments, and business travelers might bring their families along these days.

And those people, she said, will want convenient shopping in the area.

"We would certainly like to see that empty building (the former Lowe's location) put to good use and see something there that brings people to the area," Hancock said. "It's conveniently located for people who come here and with the price of gas, it's wonderful that people can come here and mix business with pleasure."

Kelly Rapone, head of tourism for the Genesee County Chamber of Commerce, wanted to emphasize that she's supportive of the proposed project at Batavia Towne Center, but admitted that she's never considered the shopping center a tourism destination and the chamber has never promoted -- as far as she can recall -- the shopping center as a tourism location.

One measure in New York of whether a location is a tourism destination, as established by the promotion campaign "I Love NY," is whether a signficant number of people from more than 50 miles away will travel to the location.

That definition is used in awarding grants to tourism projects, Rapone said.

While the shopping center is good at pulling people from neighboring GLOW counties to Batavia, she isn't sure Batavia Towne Center would measure up to I Love NY's criteria.

"(Batavia Towne Center) is definately an asset to have when people are deciding where to stay while traveling," Rapone said. "They're not going to stay in a hotel when there's nothing around."

She doesn't think, though, that people are going to travel to Batavia and stay in a hotel just to shop at Dick's.

We asked Hancock about a remark by the owner of Barrett's Batavia Marine, Mike Barrett, that tax breaks to COR is like "using your own tax money to put yourself out of business," and Hancock said she certainly hopes that isn't the case.

She doesn't think that's GCEDC's purpose, she said.

"The GCEDC has done great work with our present businesses and works with our businesses to help them expand or move to different locations," Hancock said. "Part of the GCEDC's mission is to retain business and retain jobs and they've been doing a really good job."

LATER THIS WEEK (we hope): Details on the 2007 financial package that helped create Batavia Towne Center.

Press release:

Mostert, Manzanero & Scott, LLP, presented a summary of the audit process undertaken, the scope of their engagement, the findings, and various observations related to GCEDC’s financial position to an open meeting of the Genesse County Economic Development Center Board on March 28th.

The GCEDC Board engaged Mostert, Manzanero, & Scott, LLP, a certified public accounting firm, to perform the audit of 2012 financial statements.  The audit was designed to issue an opinion on the financial statements of the GCEDC for the year ended December 31, 2012; issue a management letter to the Board of Directors and management; and issue a report on internal control over financial reporting in accordance with Government Auditing Standards. 

Included in the management letter is a statement from Mostert, Manzanero, & Scott, LL,P affirming that no material deficiencies in internal controls were identified during their audit. They also affirmed that, in their opinion, the audited financial statements present fairly, in all material respects, the financial position of the GCEDC as of December 31, 2012 in accordance with accounting principles generally accepted in the United States of America.

“We are confident that the GCEDC internal control policies are functioning correctly and that our finance team monitors the GCEDC finances within the highest accounting principles,” said Shelley Stein, member of the GCEDC Finance Committee. “After reviewing the fiscal standing of the agency and the full audit results, I recommend approval of the 2012 audit and related material.”

The financial statements of the GCEDC are reported using the accrual basis of accounting. Revenues are recorded when earned and expenses are recorded at the time liabilities are incurred, regardless of when the related cash transaction takes place. For example, expenditures are recorded in the period that services are provided, even though corresponding payment for those services may not be made until a later date.

The GCEDC finished 2012 with $590,659 in net operating income. Total operating revenue was up 87 percent over 2011, which was mostly attributable to several noteworthy projects that closed in 2012, including Muller Quaker Dairy, LLC, Perry Vet and Lassister Properties/University Eye.

GCEDC’s year-end net non-operating income, which consists mostly of grant activity, totaled $508,892, up from $4,358 in 2011. Included here is the recognition of grant income from Empire State Development that supports a land purchase at the WNY Science, Technology and Advanced Manufacturing Park (STAMP) site. The corresponding expenditure has been capitalized as land held for development and resale on the GCEDC’s balance sheet.

It's no sure thing that Dick's Sporting Goods is coming to Batavia.

First, there's no official confirmation that Dick's is the client COR Development Company has secured for the former Lowe's location.

Second, Charlie Cook, chairman of the Genesee County Economic Development Center Board, said it's far from a done deal that COR will receive more than $1 million in tax incentives to prepare the 138,778-square-foot space for a new tenant, whoever that may be.

If Dick's is the new game in town, local sporting outlets say they're ready for the competition; they just hope it's a level playing field.

The GCEDC board has yet to officially approve a trio of tax incentives for COR. The only action yesterday was to approve a public hearing for the project, which hasn't even been scheduled yet.

The board has been given scant information about COR's plans, Cook said, and without more information, the board isn't ready to act on the proposal.

"There is no commitment from the EDC for any sort of tax breaks or funding and there won’t be until we have a lot more information," Cook said.

This is the first big retail project that has come before the GCEDC board since Cook's been a member, he said, so he wants to educate himself on what projects like this mean for existing businesses before making a decision.

"I’m still learning," Cook said. "I’ve learned some things on the fly here and have been educated a bit on the impacts that some retailers might have that I hadn’t thought of. I haven’t formed an opinion yet."

Two months ago, a source told The Batavian Dick's Sporting Goods was planning a store at the former Lowe's location; however, repeated phone calls and e-mails to Dick's corporate office since then have been ignored by the corporate giant.

Dick's is a publicly traded company founded in Binghamton and now has 511 stores in 44 states. Annual sales in 2011 (the most recent numbers available) were $5.2 billion with a net profit of $1.6 billion, for a profit margin of 30.6 percent.

Those big numbers mean local retailers selling outdoors equipment and sporting goods face competition from a well-financed behemoth with significant market power.

That isn't scaring at least two local retailers who sell some of the same merchandise as Dick's, but the local owners are unhappy that a giant corporation like Dick's could benefit from any tax incentives given to COR.

Mike Barrett likened the practice of using tax incentives going to corporate chains to "using your own tax money to put yourself out of business."

Still, Barrett's Batavia Marine -- founded in 1955 by his father and uncle -- has been in the same location for decades and Barrett has seen a lot of upstarts come and go.

"We can compete in a lot of different levels they can’t," Barrett said. "Price is one thing and service is another. I knew about this coming for about a year, but we’ve outlasted a lot of other people, so … (Barrett shrugged)"

Kurt Fisher, whose store Fisher Sports is less than two years old, thinks he's found a local niche to serve and his new location in the Court Plaza (off Court Street) is doing well.

He isn't even particularly worried about Dick's potential for offering lower prices.

"The bigger issue for us would be they have more opportunity to have more stock because they have more money to bring everything into the store from every company," Fisher said. "We don't have that opportunity. Olympia (on Lewiston Road) doesn't have that opportunity. They (Dick's) can fill the store with everything, but that doens't mean their prices are good. That's their story everywhere. They have full stores but that doesn't mean they have the best price."

Fisher is ready to compete head-to-head with Dick's, but he doesn't think tax incentives should be used to give a big chain an advantage over local businesses.

"For the town and city to do that, it tells me they're more worried about the Big Box people compared to the smaller business people, for sure," Fisher said. "We don't get tax breaks and we're already in business."

Before today, Charlie Cook said he had no idea that Dick's was the potential tenant for COR. He doesn't even know now if the information is true. He said the GCEDC board was told the confidentially agreement prohibited even the GCEDC board being told who the tenant might be at this stage, even in closed session.

Who the tenant is could be critical information for the board to consider before approving incentives for COR, Cook said.

"I am interested in protecting existing businesses," Cook said. "I think when the facts come out, and more names are divulged (there could be more than one retailer moving into the former Lowe's location), if something isn't going to have an impact on local retailers and actually has attributes that benefit the local economy, you have to look at that differently than a business that competes directly with somebody down the street. Until we know more, we can't make that judgement."

Cook also acknowledged that taxpayers may have legitimate concerns to consider about COR receiving new tax incentives after receiving tax incentives in 2007 to construct the curent building for Lowe's, but "what it comes down to is we're staring at a big empty building and how can we put it to the best use."

CLARIFICATION: Regarding the headline and the item below: The GCEDC board approved the COR project being set for a public hearing, but its project has not yet received final approval.

COR Development Company, owners of property at 4180 Veterans Memorial Drive, Batavia, is planning a $4.5 million investment in the former Lowe's location for renovation, adding space and retrofitting the existing structure. The renovations will pave the way for one or more retailers to lease the space. Total tax incentives: $1,052,104. The project is part of Town Center Batavia, which is 350,000-square-feet of "destination retail space," according to the Genesee County Economic Development Center's release. In 2007, COR received incentives to build the project. The former Lowe's location is currently 138,778 square feet. Under the proposal, COR will receive $180,000 in sales tax exemptions, a $43,750 mortgage tax exemption and a $828,390 property tax exemption on the increased assessment value of the property. COR projects 120 new retail jobs as a result of the project.

Batavia Showtime, 6 Alva Place, Batavia, is planning a $52,200 investment for the purchase and installing of a digital movie projector. Batavia Showtime is approved for a $4,176 sales tax exemption on purchase of the projector. GCEDC's release states that the board is looking to assist in the project because it qualifies as a tourism destination and provides a service to the area, being the only local movie theater, that would not otherwise be available. The theater was in danger of closing prior to Batavia Showtime purchasing the facility. The owner is planning upgrades beyond the purchase of the digital projector. An estimated three new jobs will be created and four jobs retained.

Le Roy Plastics, 59 Lake St., Le Roy, is planning a $885,000 investment for the consolidation of all operations and processes into one facility. The company plans to renovate portions of the new facility and purchase furniture, fixtures and equipment. The GCEDC board approved $43,931 in tax abatements for the project, including a $24,800 sales tax exemption, $9,063 mortgage tax exemption and a $10,068 exemption on property taxes above the current assessed value.

Press release from Empire State Development:

Western New York Science, Technology and Advanced Manufacturing Park – Priority Project (Finger Lakes Region – Genesee County) – Grant - $500,000; Loan $1,100,000

Designated a Priority Project by the Finger Lakes Regional Economic Development Council, the Western New York Science, Technology and Advanced Manufacturing Park (STAMP) will create significant opportunities for semiconductor, flat panel display, photovoltaic, and bio-manufacturing projects.

The Genesee Gateway Local Development Corporation (GGLDC), which serves as the recipient of ESD’s grant and loan, was established in 2004 to handle industrial park development and serves as a conduit for assistance to private companies. Since its inception, GGLDC has completed five park developments across Upstate New York – each of which have infrastructure completed and are able to accommodate new business developments.

In 2005, GGLDC identified a market need to develop a much larger park than those previously developed. Such a mega site, of at least 1,000 acres, would seek to attract a large-scale advanced manufacturing project. GGDLC identified a site in the Town of Alabama, and since 2008 has expended several million dollars for preliminary multifaceted feasibility studies, completed an Environmental Impact Statement, and conducted community outreach and began to acquire property. In order to continue developing STAMP as New York State’s third mega site, ESD is providing a grant of up to $500,000 and a loan of $1.1 million to assist in the purchase of 364 acres of land at the site for the next phase of development.

GGDLC currently owns 143 acres with the option to purchase another 1,073. This real estate transaction will allow for design, engineering and construction for the initial infrastructure at the site, which will be completed by the end of 2014.

This project will position Western New York State as a hub for advanced technology manufacturing and spur significant regional economic growth. There is potential for up to 1,200 jobs at the STAMP site by 2016, and over 9,300 projected jobs at full build-out in 2032.

Reed Batavia Properties, LLC, 39 Washington Ave., Batavia, has been approved for $140,861 in tax incentives for upgrades to its building. Reed purchased the building from Batavia City Schools. The 13,452-square-foot building is the former administration building. Reed will renovate the building for medical/office use. Genesee County is currently designated a Health Professional Shortage Area. The assessed value is $475,000. The property was formerly tax exempted and will become taxable at the current assessed value. Reed will receive a tax abatement PILOT on the increase in assessed value over the current assessed value, which is an anticipated tax savings for Reed of $76,361. Reed will also receive sales tax exemption on construction materials, furniture and fixtures of $52,000 along with a mortgage tax exemption of $12,500. Reed is investing $1.5 million in the project and expected to create six new jobs.

Yancey's Fancy, Inc./D&Y Cheeses, Inc., 857 Main Road, Pembroke, is planning a $10.2 million expansion. GCEDC has approved $980,000 in incentives. The expansion will increase capacity and create new flavors and cheese types. All packaging will be performed at the facility. The company will also build new offices. The current facility is 29,000 square feet. The expansion is 65,000 square feet plus a 25,000-square foot expansion of the second floor. The sales tax exemption is $320,000 with a mortgage tax exemption of $112,500 and PILOT of $547,533. Yancey's Fancy has pledged 50 new jobs within three years.

Darien Lake Theme Park, is investing $5.2 million in new rides and upgrades to the park and accommodations. The company will receive a $328,939 incentive package through GCEDC. The project includes construction of new cabins, a new "launch ride," and a laser light attraction. The upgrades are expected to take three years to complete. GCEDC has approved a sales tax exemption of $181,600 and a PILOT of $147,339. Darien Lake provides more 400 full-time equivalent jobs, including 2,000 seasonal workers. The expansion is expected to create six new jobs and retain 422 FTEs.

Fontrick Door, Inc., 9 Apollo Drive, Batavia, is expanding through acquisition of the building at 1 Treadeasy Ave., Batavia. Frontrick Door is investing $500,000 to purchase the $31,919-square-foot building, where it plans to develop a window manufacturing location in 2014. GCEDC has authorized a mortgage tax exemption of $6,250. 

Bonduelle is planning to make a $3.2 million capital investment in its plants in Oakfield, Bergen and Brockport. This is mainly a retention project to upgrade facilities, according to GCEDC. The majority of the investment will be made at the Oakfield plant, where a lima bean line will be installed. Bonduelle has secured contracts with farmers for 2,500 acres of lima bean production. The upgrades are expected to lead to 12 new seasonal -- five months -- jobs in Oakfield. Bonduelle is receiving a $250,000 grant for the project. Jobs retained: 305.

More than 200 people were at Genesee Community College this afternoon for the Genesee County Economic Development Center's annual meeting at which CEO Steve Hyde gave his annual report on the progress of the Industrial Development Agency.

Mary Pat Hancock (top photo), chairwoman of the Genesee County Legislature, was among the speakers and praised the agency for its contributions to the local economy.

"This agency has initiated, planned and implemented much of the successful economic growth in this county over the last 15 to 20 years," Hancock said. "They put their money where their mouth is, by loaning and backing potential investors who are willing and able to do business in New York and Genesee County, with a little help. Their success has sometimes made them a target, but none can deny their role in making this area flourish during a time of economic stagnation in much of this Upstate area."

Below is a press release from GCEDC about the meeting:

The Genesee County Economic Development Center (GCEDC) held its annual meeting at Genesee Community College to unveil the organization’s 2012 annual report to the community. During the meeting, National Grid was honored and recognized for its collaboration in the community as the company received the Economic Development Partner of the Year Award from the GCEDC.

Among the attendees at the annual meeting included U.S. Congressman Chris Collins, New York State Senator Michael Ranzenhofer, New York State Assemblyman Stephen Hawley and Genesee County Legislature Chair Mary Pat Hancock as well as other local government and business officials. 

“We have the most progressive economic development agency in New York State and that is attributable to everyone here today,” said Charlie Cook, GCEDC Chairman. “Through the leadership of the public and private sectors we have built a solid foundation for success now and in the future and in fact, the GCEDC board has already approved five major projects for 2013.”

Among the economic development highlights for the region as outlined in the 2012 annual report include.

• The attraction of 12 new businesses;
• The ground breaking of the Muller Quaker Dairy facility at the Genesee Valley Agri-Business Park, which helped exceed investment goals in 2012 by more than $205 million as well as a multiplier effect of $27 million of income across the region from direct, indirect, and induced wages annually and the creation of approximately 692 jobs across various support sector industries and construction wages of $10 million;
• The closing of 38 projects, with these companies contributing $225 million in capital investment and pledging the creation of more than 400 new jobs;
• Expansions and fulfillment of job creation at Alpina Foods LLC, which also is located in the Genesee Valley Agri-Business Park;
• Economic growth as a result of projects at O-AT-KA Milk Products, Yancey’s Fancy, Liberty Pumps, Perry Vet, and Darien Lake; and
• The unanimous vote by the Town of Alabama Board to rezone the Western New York Science, Technology and Advanced Manufacturing Park (WNY STAMP) site, which allows the GCEDC to proceed with land acquisition.

“It is imperative that we continue to maintain the momentum generated in 2012 for 2013 and as such among our goals this year is to bring the Buffalo East Technology Park to full shovel-ready status, bring $29 million of new capital investment to the County as well as finalize plans to bring a new middle-income housing development to the community,” said Steve Hyde, president and CEO of the GCEDC.

“Lastly, we will continue our efforts to make STAMP a reality as it has the potential to transform the Western New York and Finger Lakes region into a high-tech nano-manufacturing hub that over the next 20 years could create 30,000 jobs onsite and by supply chain companies,” Hyde concluded.

Press release:

Site Selection Magazine has once again recognized Batavia/Genesee County as one of the top micropolitans in the United States. For the ninth consecutive year, Batavia/Genesee County has made the Site Selection Governor’s Cup rankings for top micropolitans and is now ranked tied for fifth on its national list.

“It is very difficult to jump up so many spots, especially with the intense competition among the top micropolitans throughout the United States,” said Mike Glennon, regional marketing director of Site Selection Magazine. “Congratulations to all in economic development in Genesee County; this is a superb job and a testament of the strength of the business climate and assets Batavia and the region have to offer.”

The ranking of Top Micropolitans is based on cities of 10,000 to 50,000 people which cover at least one county.  There are approximately 576 micropolitans in the United States according to Site Selection Magazine.  Batavia tied Shelby, N.C., for fifth place in the national rankings.

“This is a great recognition in an extremely competitive industry and it once again reinforces that when the public and private sectors work together we can accomplish great things for the region,” said Steve Hyde, president and CEO of the Genesee County Economic Development Council. “We look forward to continuing the momentum of this collaboration in our economic development efforts for 2013.”

The GCEDC will unveil its 2012 Annual Report highlighting performance results at the organization’s annual meeting on Friday, March 8 at Noon at Genesee Community College.

Among those attending include Congressman Chris Collins, New York State Senator Michael Ranzenhofer, New York State Assemblyman Stephen Hawley, Genesee County Legislature Chair Mary Pat Hancock and other local government and business officials.

National Grid will be recognized by the GCEDC as economic development partner of the year. Tickets are $20 and can be purchased in advance by calling the GCEDC at 343-4866.

Press Release:

The Genesee County Economic Development Center (GCEDC) announced that applications to its Food Processing Training Program are available beginning March 4th. The deadline for submitting applications is April 15.

Applications will be available at the Genesee County Career Center, located at 587 E. Main St., Suite 100, Eastown Plaza in Batavia. Applicants will need to complete a Customer Registration Form at the Genesee County Career Center as well as submit an up-to-date resume, and, if required, participate in a math/reading test and a follow-up interview.

“This is a very exciting initiative because it is an integral component of our business operations, creating opportunities for employment for our residents,” said GCEDC Chairman Charlie Cook. “The program also continues our commitment of collaboration among various public and private sector partners throughout the community.”

In addition to receiving a non-credit certificate from the Genesee Community College (GCC), participants will have a permanent record and transcript for successful completion of the program. They will also receive certificates in Lean Systems Six Sigma Yellow Belt (Rochester Institute of Technology), Team Building (GCC), Basic Dairy Science & Sanitation Certificate (Cornell University), and an OSHA Certificate for Safety in a Manufacturing Environment (GCC).

The training program, developed by GCEDC, GCC, RIT and Cornell University, will benefit the area’s existing food-processing companies. It will also prepare a workforce for companies in the Genesee Valley Agri-Business Park.

The training program is being funded by an Area Development grant obtained by the GCEDC from the National Fuel Gas Corp. with additional financial support from the Finger Lakes Food Cluster Initiative — funded by the Department of Labor's Employment and Training Administration in the amount of $38,000 or 28 percent of the program. The program is expected to train approximately 120  people while creating a model for future food processing and technology training programs.

“If we are to continue to market and grow the food-processing industry we need skilled and educated workers,” said Steve Hyde, president and CEO of the GCEDC. “The investment we make to train and educate our workforce is just as important as the investment we make in bricks, mortar, water, and sewer infrastructure that makes our properties shovel-ready to bring business here.”

The Genesee County Economic Development Center Board of Directors has approved assistance with the following projects:

Darien Lake Theme Park. Darien Lake is planning new cabins and new rides for 2013. The total investment by Darien Lake is $5.2 million and theme park management sought assistance with $1.9 million of the investment. The board approved a PILOT (reduced property tax on the increase in assessed value due to the improvements) worth $147,339 over 10 years. The project will also save $132,000 on sales tax for construction materials. The project is expected to generate six additional full-time equivalent jobs. Darien Lake employees more than 400 FTEs.

Reed Batavia Properties, LLC. Reed is in the process of purchasing the former Batavia City Schools administration building at 39 Washington Ave., Batavia. The company is planning $1.525 million in improvements to the building, converting it to medical offices. The GCEDC board approved a $76,361 PILOT, $52,000 in sales tax exemption, and a $12,500 mortgage tax exemption. The project is expected to generate six new jobs.

Batavia Hospitality, Inc. (Days Inn / Super 8). The company is planning on investing $530,000 in building improvements, including a new pitched roof, exterior facelift and interior upgrades. GCEDC's board approved a PILOT worth $54,198 over 10 years and sales tax exemption of $28,000. The project is expected to create five new jobs and help retain 16 jobs.

A proposal by Gov. Andrew Cuomo to curtail sales tax exemptions on new development and redevelopment projects could hurt such projects locally, according to City Manager Jason Molino and Steve Hyde, CEO of the Genesee County Economic Development Center.

"Losing the ability to offer state portion of sales tax exemptions dilutes our financial assistance offerings at the local level," Hyde said. "That hurts since we remain the 49th most expensive state to do business in."

Nearly all projects that come to the Industrial Development Agency for assistance and the promise of job growth receive a sales tax exemption on building materials, plant expansion and/or new equipment.

The City of Batavia has been aggressively pursuing projects that redevelop commercial parts of the city -- called "brownfield redevelopment" -- and the loss of the sales tax exemption could be a setback for those plans.

While Molino is reserved in his judgement since the governor's budget is still in the early proposal phase, he said if the elimination of sales tax exemptions goes through, it won't be good for Batavia.

"I think it has the potential to negatively affect any economic development effort that would use sales tax exemptions as part of its model for development," Molino said.

Hyde said much of the redevelopment necessary in the city won't qualify for the state's "excelsior program," which provides tax credits for strategically targeted industries, so maintaining the sales tax exemption is critical.

"We can support some really exciting things developing in the city to the fullest extent possible," Hyde said.

The Buffalo News carried a story this morning about how the budget proposal will be a setback for redevelopment in Buffalo.

Hyde encouraged constituents to reach out to the governor's office and express concern about the proposal.

"This topic is important as community development projects will be negatively impacted considerably and those are the lifestyle projects important to our  residents," Hyde said.