Committee approves Delaware North tax break request - The Buffalo News

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Committee approves Delaware North tax break request

Delaware North Companies’ request for sales tax breaks for its proposed new corporate headquarters moved closer to final approval Friday afternoon, after the policy committee of the Erie County Industrial Development Agency unanimously approved the company’s application.

With little debate and a 13-0 vote, the committee members forwarded the $807,000 sales tax abatement to the full board for consideration at its meeting Monday morning at the Central Library, where it is not expected to see much opposition.

Other than prepared remarks by Delaware North executive Dan Zimmer, who also fielded questions from committee members, there was no public comment Friday as the committee met in the auditorium of the Burchfield Penney Art Center, and about 20 people attended.

Zimmer noted that the company’s employment has grown from 270 a decade ago to its current size of 350, with an average annual salary of $97,000. And he said that half of employees are minorities, including one-fourth of management, and 44 percent are unionized.

“This project is important for the community. Delaware North has made a substantial commitment to this community,” said Buffalo Mayor Byron W. Brown, a member of the committee and ECIDA board, who previously joined with Rep. Chris Collins, R-Clarence, to write a letter of support for the Delaware North project.

Officials acknowledged that this is the second time that Delaware North has received ECIDA assistance, after it obtained $2.5 million in property and sales tax breaks in 2000 for its move to Key Center’s South Tower.

“The IDA tends to see a lot of companies who come back for repeat incentives, primarily because they’re the job creators, the risk-takers,” said ECIDA Vice Chairman Christopher Johnston, who also termed the company’s request “rather ordinary” at just $2,000 per job compared with what others have sought. “I don’t think we should do anything to alienate a company in Buffalo, especially a homegrown company.”

Friday’s vote concerned only Delaware North’s plan to spend $17 million to build out its portion of a proposed 12-story hotel and office tower. The abatement would apply only to its purchases of furniture, equipment and construction materials.

The vote does not affect the separate but parallel application by Uniland Development Co. for a mixture of more than $3.2 million in standard sales, mortgage and property tax breaks for the larger $81 million project. The project includes not only 200,000 square feet of office space – more than half for Delaware North – but also a 119-room hotel, four boutique retail stores and a parking ramp in the rear of the building.

That proposal, which was tabled nearly two weeks ago because of widespread uproar over part of the initial request, was revised on Tuesday to reduce the size of the ramp and take out the most controversial aspects, particularly a special financing arrangement for the garage.

It will now be the subject of a second public hearing at 8:30 a.m. Nov. 25 in the IDA’s 95 Perry St. office. It will then go to the policy committee on Dec. 2, and then to the full board on Dec. 16 at 9.

The developer is not seeking tax breaks for the hotel or retail portions of the project, which would violate ECIDA policy, but only for the shell of the building, the overall office space and the ramp.

Richard Tobe, deputy county executive and chairman of the policy committee, said Delaware North has also applied for and received benefits from the Empire State Development Corp., though he said he did not know the nature of the benefits or how much. Uniland also sought state help, he said, but Empire State Development has told the developer that it will not get anything more than brownfields tax credits that it is entitled to because the project site formerly housed a gas station.


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