Amherst senior housing project fails to win IDA tax breaks - The Buffalo News
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Amherst senior housing project fails to win IDA tax breaks

A proposed senior housing project near Maple Road and Niagara Falls Boulevard suffered a setback Friday, when the Amherst Industrial Development Agency failed to move the proposal forward after a spirited debate over the merits of subsidizing apartments for seniors.

Robert Savarino sought the agency’s backing for a $9.7 million plan to build a 101-unit, four-story apartment building for seniors at 70-80 Meyer Road, behind Sears Auto Center, and near the Tops International store and Boulevard Consumer Square.

The 118,835-square-foot, wood-framed building would have included 38 one-bedroom units, renting for $925 a month, and 63 two-bedroom apartments, with a monthly rent of $1,050 – all with one bathroom – geared for independent living.

But the IDA balked at providing tax breaks to the project, which never came up for a vote Friday after no board member was willing to second the motion to approve the project.

“We’re all in favor of senior housing,” said Town Supervisor Barry Weinstein. “My issue is the subsidy. I don’t believe in subsidizing projects of this nature.”

That doesn’t mean the project won’t come before the IDA board again, though.

Saying he was “really shocked” by the result, Savarino initially said he wouldn’t proceed with the project. But following subsequent discussions with his attorney and board members after the meeting, he said he would return in a few weeks with more information and clarifications to respond to some of the board’s questions and concerns.

“I do believe this is a benefit to seniors in this area,” he said. “It’s a $10 million private investment, and it has fiscal benefits to the Town of Amherst, and it adds quality of life to the citizens of Amherst.”

The inability of the board to even vote on the proposal indicates the difficulty that economic development officials are having with the issue of market rate senior housing.

The aborted vote comes just a few months after the Amherst IDA approved its modified policy on senior housing projects. That followed the expiration of a moratorium on all senior housing projects that it put in place for part of last year, stemming from criticism of prior tax breaks on such projects.

The Erie County Industrial Development Agency, for instance, generally will not provide subsidies to market-rate housing projects. Ongoing efforts to develop a countywide policy among the county’s IDAs for senior housing projects have failed to yield a consensus agreement.

While almost no one disputes that there’s a need and value in having more senior housing available locally, particularly for mid-range market-rate apartments, critics say taxpayers shouldn’t be helping a for-profit developer and giving one building a competitive edge over another. Instead, they say, such projects should go forward or fail on their own.

Further adding to the debate, a study by the University at Buffalo found that fewer than 1 percent of Erie County senior citizens move out of the county because they are unable to find suitable housing – a finding that contradicted a long-held belief that a housing shortage was driving elderly residents away.

Weinstein noted that a request for tax breaks for a senior housing complex at Maple and Ayer roads in Amherst was rejected by the Amherst IDA in May 2013, with the developer threatening that the project would not go forward because unsubsidized rents would be too high.

But a year later, construction on the Maple Road Senior Apartments is now ongoing.

“And he’s going to compete,” Weinstein said.

“I think there is a need for senior housing,” he said. “The issue comes down to should we be subsidizing it as part of adaptive reuse and economic development. This is market-rate rent being artificially lowered by a subsidy, which makes it problematic for the competitors. The proposed project would have had an unfair advantage.”

Savarino, in a presentation, cited market research data to justify the project, based on the demographics and finances of the population within eight surrounding census tracts.

But he claimed that he needed the IDA’s help to make the project viable because the rents he would have to charge to keep the units affordable would not be enough to offset projected expenses, including the property tax rate in the Sweet Home School District, which he said would represent two-thirds of his annual expenses.

“I can’t just raise the rents, given its location, to cover the annual debt service,” he said. “I can see how it would be politically incorrect to incentivize luxury senior housing, but this isn’t luxury. The project does not throw off any return. I can’t qualify for financing.”

Savarino said the project met three of the criteria included in the agency’s January 2014 resolution allowing for tax incentives for senior housing projects. That included one for encouraging walkability and ease of access to services, retail and transportation.

And while he acknowledged it was not a case of adaptive reuse, since he’d be knocking down the existing structures, he still called it a “redevelopment” and “in-fill” project in an area that “carries the characteristics” of an enhancement or redevelopment area, although it’s not actually in one.

But the board didn’t go along with him. Instead, it questioned whether the project truly met the criteria set in January – or was truly “walkable,” given the area around it – and whether taxpayer help was appropriate.

“I’m not sure I’d want to walk it in the dead of winter,” said board member Marshall Wood.


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