The chances of approval for the transfer of the Inducon Industrial Park to the Niagara County Industrial Development Agency appeared high after Tuesday's meeting of the County Legislature's Finance Committee.
After hearing a presentation from IDA Executive Director John R. Simon, all seven members of the Legislature's Republican majority who heard it expressed support for the plan.
Legislature Chairman Gerald E. Meal, R-Royalton, endorsed the notion of deeding the 151-acre site on Lockport Road in Wheatfield to the IDA, for the IDA to market to prospective businesses.
"I think it's the only way for the county to go," he said.
But the Finance Committee, at the request of Assistant County Attorney Richard C. Kloch Sr., voted to create a special five-member committee to look into the impact of the deal and report back next Tuesday.
Finance Chairwoman Shirley G. Urtel, R-Cambria, said her panel would hear the special committee's report and vote on the contract with the IDA. If it passes, it would go immediately to the floor for a vote by the Legislature the same night.
The contract is still being negotiated by Kloch and IDA attorney Ralph A. Boniello III. Kloch said the special five-member committee will both keep the lawmakers informed and provide information for him on the county's priorities.
The members will be Kloch, County Treasurer David S. Broderick, Real Property Tax Services Director William F. Budde Jr., and one legislator of each party. They have not been chosen yet.
Simon's plan calls for the IDA to make up nearly $4 million in back property taxes the county would otherwise never see. The county would receive a share of the price of parcels the IDA would sell to developers, and also benefit from payments in lieu of taxes those companies would make.
The county foreclosed on Inducon after the former owner, 2400 Lockport Inc., failed to pay property taxes for eight years. The property was included in the county tax foreclosure auction last week, but no one bid on it.
A private bidder would not have had to pay the back taxes, and Simon said the IDA didn't have to, either.
"I'm confident when (legislators) see that's a proposal that has only upside for the county, they'll realize that we're sincere in trying to recover nearly $4 million for the county," Simon said.
One key in the deal for the county, Simon said, is that it will no longer have to make up special assessments to the Town of Wheatfield. It has paid the town $1.1 million since 1992, since state law says the county is responsible for them if the private property owner defaults.
Simon said, "I suspect not many, if any, of the legislators knew they were paying this on an annual basis."
Legislator Robert L. Seger, D-North Tonawanda, expressed fears about competition between Inducon and other industrial sites, especially Witmer Industrial Estates nearby in the Town of Niagara.
That town's supervisor, Steven C. Richards, replied, "Don't worry about the Town of Niagara. We're filled. . . . My concern is the cities. All three cities in this county are in extreme distress."
He worried Simon might emphasize Inducon in his marketing pitches to new businesses because the IDA is committed to using its proceeds to pay off the county "while our cities are dying."
Simon repeatedly said that won't happen. "We don't tell the companies where to go. We market the whole county."
But he said contract negotiations are already under way with the prospective builders of two 120,000-square-foot warehouses and a 30,000-square-foot office building, all for Inducon.
"Those projects are dependent on the IDA having site control," Simon said. If the Legislature decides to try to re-auction Inducon or market it itself, Simon said not only will those companies walk away, but the IDA itself will look elsewhere for a $3.5 million building it wants to construct.
That structure, planned for Inducon, includes new offices for the IDA and space to rent to 17 businesses.
Besides the payments in lieu of taxes, which would be split with the town and the Niagara-Wheatfield School District, the county would receive two-thirds of the sale price for parcels in the half of the Inducon site closest to Lockport Road, and one-third of the price of parcels in the back half of the industrial park.
Simon estimated prices of $18,500 per acre in the front half, $15,000 per acre in the back. He estimated county proceeds from sales alone at $1.3 million, while the IDA would keep $1,175,000.
He estimated payments in lieu of taxes for the county at $6,450,000 over 15 years, based on an estimated $100 million in assessed valuation. But under questioning from legislators, Simon conceded that estimate "presumes everything (is sold) in year one, which is not a real-life situation."