Uniland Development Co. must pay back $490,000 in federal aid the company received in 2003 to help develop a still-vacant industrial park in Lancaster, the U.S. Department of Housing and Urban Development has decided.
The company has failed to meet a job-creation target tied to the HUD grant and has received numerous extensions to its original, three-year deadline.
The most recent extension expired in March, and officials from Uniland, Erie County and the Town of Lancaster sought more time for the company to market the 128-acre Eastport Commerce Center site.
But HUD officials announced that Uniland hasn't shown enough progress at the site to merit another extension and that the money must be returned.
"Reassurances that the developer and other stakeholders are continuing their best efforts to bring a business into the industrial park are no longer sufficient," Joan K. Spilman, director of HUD's Buffalo field office, said in a May 23 letter to Rep. Kathleen C. Hochul, D-Amherst.
Hochul contacted HUD on behalf of Erie County and the Lancaster Industrial Development Agency, which had passed the community development block grant funds to Uniland.
"I certainly wish they would have given us more time," said Lancaster Supervisor Dino J. Fudoli, the IDA chairman.
Uniland is disappointed with HUD's decision, but the company remains optimistic for the park's future, a representative said Tuesday.
"We presented what we felt was a refreshed marketing plan for the site that we felt would garner even more interest than has already been shown," spokeswoman Therese J. Hickock said.
Uniland received the HUD funding in 2003, one year after the company purchased the parcel at the northwest corner of Walden Avenue and Pavement Road.
Counting the initial purchase price, Uniland has spent $7.8 million of its own money on the project, including property taxes and the cost to install utilities and roads at the site, Vice President Michael J. Montante wrote last month to Fudoli.
The $490,339 HUD grant required Uniland to create 25 low- to moderate-income jobs at the park within three years of receiving the aid.
Since 2003, the Eastport property has been the rumored future home of a CarQuest distribution center, a Yahoo data center and a National Veterans Cemetery, among other prospective projects, but none has come to fruition there.
Uniland has received a number of extensions on the job-creation requirement, granted by HUD at the request of county officials. But local HUD officials said the agency can't grant additional time for a project that hasn't produced results.
"To date, the county has not been able to provide HUD with any indication that further development leading to job creation is imminent, and there is no indication that the developer will be able to bring the project to completion within the next 12 months," Spilman wrote.
The returned grant money will be used to boost another eligible development project in the county, said Maria R. Whyte, the county's commissioner of environment and planning.
The county supported giving Uniland more time but, Whyte said, "At the end of the day it's not our call, and so HUD has spoken."
Fudoli said Tuesday he's disappointed HUD didn't grant another extension, given that he has only had since taking office in January to work on the project with the company.
Now his largest concern is that the next project funded by the returned HUD aid won't necessarily be in Lancaster.
Uniland had sought a two-year extension of its March deadline, but Hickock said the company would have been grateful for a one-year extension.
Hickock said HUD has not told Uniland when the repayment must be made, and the company is moving forward with its plans for the Eastport site.
"We're not giving up. We do feel there's a way we can still make this work, for everyone's benefit," Hickock said.