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Mayor Anthony M. Masiello is asking the state to open its wallet a lot wider to convince the parent company of Blue Cross/Blue Shield to build its new headquarters on a downtown Buffalo brownfields site.

In a letter to Gov. George E. Pataki, the mayor said he and HealthNow are grateful for the $17 million inducement package the state has offered to aid the $90 million-plus project -- but it's not enough.

"This amount doesn't account for the additional costs that come with choosing an urban location over a brand new, built-to-suit location in the suburbs," Masiello wrote. "Given that the proposed parking facility alone will cost $22.5 million, we need additional assistance to encourage HealthNow's investment in our region's urban core and discourage further sprawl."

The state's incentive offer is said to include a mix of Empire Development Zone and Community Renewal benefits, brownfield reclamation funds and historic preservation credits, plus approximately $7 million in cash to be used toward construction of a parking garage.

The new headquarters would be built on a 5-acre site of the former Buffalo Gas Light Co. at 249 W. Genesee St., adjacent to the Niagara Thruway. It would be home to 1,200 workers, plus as many as 200 future hires as the insurer grows.

HealthNow spokeswoman Laura Perry said her company was not involved in the mayor's letter-writing effort.

"We were not aware of the letter," Perry said. "We appreciate the mayor's effort. He's certainly showing great commitment to keeping us in the city."

Perry reiterated the company's earlier statements that while it is interested in the former gas works site, it "has not made a final site selection."

The mayor said the state should consider reaching into its economic development fund or even tapping the fund set aside for the ill-fated Adelphia Communications operations center to provide more cash for the HealthNow project.

"I don't care what pot of money it comes out of, I just want to be able to close this deal as soon as possible," Masiello said in an interview.

The city is expected to aid the project by contributing two parcels of land it owns adjacent to the site, and to provide as-yet-undefined help through the Buffalo Economic Renaissance Corp.

Assembly Majority Leader Paul A. Tokasz, D-Cheektowaga, said he was surprised to learn of Masiello's call for more state aid for the project.

"I was under the impression the discussions between Empire State Development Corp. and HealthNow were virtually complete and that any open questions were between HealthNow and National Fuel," Tokasz said. "This is the first I've heard anybody suggest the state isn't doing all it should."

In late October, the health insurer confirmed it is interested in the site owned by National Fuel Gas Co., which is vacant except for the historic walls of the nearly 150-year-old gas plant.

It will require environmental remediation to remove or contain coal tars and benzene residual left from coal-to-gas production in the late 1800s.

The mayor said HealthNow's interest in reclaiming the brownfields parcel for productive use after sitting idle for nearly 20 years deserves additional public investment.

"The value of transforming a vacant brownfield into usable land again, combined with the dynamics of bringing so many people downtown to work every day, can hardly be overstated," the mayor said in the letter.

"We simply cannot afford to let this one get away."

The parent company of Blue Cross/Blue Shield, which is headquartered at 1901 Main St., has been evaluating relocation sites for nearly a year.

Its current home will become part of the Canisius College campus in 2007.


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