Editorial: State tries new strategy for failed Batavia plant - The Buffalo News

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Editorial: State tries new strategy for failed Batavia plant

State and local economic development officials have welcomed HP Hood, the latest company promising hundreds of jobs at the Genesee Valley Agri-Business Park in the Town of Batavia. Hopes are high that the second time will prove the charm.

The company is poised to succeed Muller Quaker Dairy, which made Greek yogurt at the plant for two years before closing. Hood is making a $200 million investment in the plant, including $50 million to buy it. The company expects to create 230 jobs over five years, significantly more than Muller Quaker.

Hood will repurpose the facility and build a warehouse, and plans to start production in the second quarter of 2019. There is every reason to be hopeful. As one high-level state official put it, HP Hood is not breaking new ground with its dairy products.

Officials of HP Hood, based in Lynnfield, Mass., would not give specifics of what will be made at the plant other than saying it will turn the site into a processing facility for “extended shelf-life beverages.”

It could work and, if not, then it’s on to the next idea. Economic development can be an uncertain venture, as the public has discovered.

Muller Quaker Dairy had big plans in 2013 for the newly built $200 million plant. Success seemed assured with the joint venture between beverage giant PepsiCo and German dairy company Theo Muller Group. It wasn’t. The company said the plant failed to meet expectations and, like that, 170 jobs were eliminated.

Muller received only a small portion of the $4 million originally allocated through the Excelsior tax credit program, collecting $800,000 based on employment and investment.

The Excelsior program doesn’t simply hand over those tax credits. Howard Zemsky, the state’s economic development chief, said the program allows companies to collect incentives only if they live up to their commitments.

The state puts a lot of money on the table to help attract companies. That worries some critics of incentives, but such breaks are necessary in high-tax New York.
Gov. Andrew M. Cuomo aptly described Empire State Development as “an investment banker for the State of New York,” helping the state compete with every other state putting cash on the table to tempt companies. He also recognizes that each deal involves some risk: “If you want to develop jobs and you’re going to partner with companies, you have to expect some of those companies to fail.”

Even with state and local support, Hood has a lot of skin in this game, so it must believe it can succeed where Muller Quaker failed. Success this time would be welcome.

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