The Niagara County Industrial Development Agency Wednesday accepted an application for upwards of $3.9 million in industrial development bonds from the potential landlord of the TeleTech Corp.
The Falls Street Leasing Corp. submitted the application, seeking the money to buy the empty Falls Street Station building in downtown Niagara Falls and to renovate it to suit TeleTech's operations.
The application noted that the actual amount of money to be borrowed through the bonds could be a low as $2.2 million, depending upon the approval of other funding sources supplied by the City of Niagara Falls, Niagara County and New York State.
The IDA made one change in a cover letter that accompanied the application in which the leasing corporation predicted that employment at the TeleTech operations would start at 500 and increase to 670 within three years.
Agency member David May noted that when the project was first outlined, the employment figures were 750 to start and a potential of 1,000.
"This project changed shape rather quickly," May said. "Why suddenly the change? That's a far cry from the 750 and 1,000 we were told originally."
The wording on the application was changed to 750 employees after the third year. Leo Nowak Jr., executive director of the IDA, said that if the employment fails to reach the 750 on the third year, the company's payments in lieu of taxes could be altered. As it stands, the payments in lieu of taxes to the city, the county and the school district will be frozen at $65,000 a year for the first 10 years of the bonding and $71,500 for the years 11 through 15.
The IDA said it will hold a public hearing on the leasing corporation's application at the Earl W. Brydges Library on Nov. 12 at 10 a.m..
As announced in July, the industrial revenue bonds will be used to help finance a $6,720,000 project. The balance will come from a $1.5 million loan from Niagara County, a $1 million loan from the New York Power Authority's Niagara Economic Development Fund, $700,000 from the State Jobs Now program, half of which will be an outright grant and half as 20-year loan; a state subsidy grant of $400,000; a $180,000 grant from the City of Niagara Falls and a $200,000 grant from the Niagara Falls Urban Renewal Agency; $40,000 grant from Nynex, and $500,000 cash investment by the landlord, Falls Street Leasing Corp.
The loans from the county, the Jobs Now program and the Power Authority fund are repayable in 20 years.
Falls Street Leasing said $3 million will be used to purchase the 65,000 square feet of Falls Street Station; $2.3 million will be spent on renovations; $700,000 on infrastructure costs; $460,000 on soft costs; $180,000 on equipment set-up, and $80,000 for a fiber optics line.
The leasing corporation said it signed a 20-year lease with TeleTech Holdings Inc. on Sept. 25. The lessee has an option to terminate the lease after the 15th year. The terms of the lease have TeleTech making an annual payment of $615,714 the first two years; $795,714 the third year; $822,714 years four and five; $836,108 the years six through 10, and $966,108 the years 11 through 15.