Sorrento Cheese Co. wants Erie County and state incentives to help finance another major expansion at its South Buffalo plant, an $8 million project that will create an additional 60 jobs.
Sorrento, the nation's largest seller of Italian cheeses, recently acquired the dairy division of J.R. Simplot Co. Inc., an Idaho-based company.
Robert Woeppel, Sorrento's vice president for human resources, said some of the new products will be distributed from the company's East Coast center on South Park Avenue.
"The acquisition has allowed us to broaden our product line," Woeppel said. "We're distributing cheddar, Colby, blue cheese, cream cheese and other products."
The expansion involves construction of a 86,000-square-foot addition that will include anew cooler, warehouse space and new office facilities.
The Erie County Industrial Development Agency announced Wednesday that Sorrento has submitted an application for $7.9 million in bond financing. If the incentive package is approved, the company will save several hundred thousand dollars in property taxes over 15 years and another $93,000 in sales taxes.
ECIDA Executive Director Ronald W. Coan said the agency will hold a public hearing on the application next month, at which time the exact value of the proposed incentives will be disclosed.
Meanwhile, a spokeswoman for Gov. Pataki's main development agency announced Wednesday that Sorrento has been offered a $450,000 capital grant to help finance the expansion. Maura Gallucci of the Empire State Development Corp. said the grant is expected to be finalize soon.
"We've been working with Sorrento all year to make sure that this substantial investment was made in New York," Ms. Gallucci said. "Sorrento was seriously considering a California site for this expansion."
Sorrento is a subsidiary of Besnier SA., the largest dairy group in Europe. The division employs about 400 people in the Buffalo area and 1,500 nationwide.
In 1998, the South Park plant produced about 100 million pounds of cheese and consumed more than 60 percent of the milk produced in the western half of the state. The Buffalo facility is also the distribution center for the eastern half of the United States.
About 93 percent of Sorrento's sales are made outside Erie County, a fact that impresses IDA officials. Board members frequently underscore the importance of providing incentives to "wealth-creating companies," including producers that export substantial quantities of goods outside the region.
Eight months ago, Sorrento officially opened its new corporate headquarters on South Park, an expansion that also received government subsidies. Woeppel said about 40 new jobs have been created in previous expansions and an additional 60 jobs will be created over two years. ECIDA officials said that Sorrento will have invested more than $11.5 million in the local plant by the time the new expansion is completed in a year.
Two months ago, the Common Council cleared the way for the new expansion when it approved Sorrento's request to rezone eight residential lots on the Leland Drive side of the facility.
In other action Wednesday, the ECIDA voted 11-1 to approve incentives sought by organizers of the first new bank to set up in Buffalo in decades. Greater Buffalo Savings Bank will open a branch at 47 Court St., a building that will also serve as its headquarters until it renovates and moves into a landmark building at 2880 Main St. near Jewett.
The bond financing will save the bank about $80,000 in sales taxes on equipment and other office-related purchases.
The only dissenting vote was cast by Andrew J. Rudnick, president of the Buffalo Niagara Partnership. He said he has a difficult time justifying incentives for the creation of a branch bank.
While other ECIDA board members voted in favor of the tax breaks for Greater Buffalo Savings, some suggested that the incentives create a "double standard."
They noted the agency has been seriously eyeing a plan that would rule out tax breaks to any hotel located outside a downtown hospitality district. In previous debates, some directors balked at helping hotel owners buy new furniture, carpeting and other items.
Anthony N. Diina, an ECIDA director who intends to invest in Greater Buffalo Savings, agreed that sales tax abatements should be considered for any business that can make a case that it is fostering economic development. Diina voted in favor of the incentives, stating that because his stake in the bank will less than 5 percent, it poses no conflict of interest as stipulated by state law.
Coan said the ECIDA has a "long history" of providing incentives to banks, including the former Marine Midland, as well as Goldome and the Key Towers. He also reiterated the agency's position that it does not intend to provide additional incentives to the bank when it relocates to the former Braun Cadillac showroom at Main and Jewett.