The Amherst Industrial Development Agency board Friday debated the merits of granting tax abatements to not-for-profit organizations constructing facilities for the elderly.
The agency already has fielded calls and held meetings with potential developers of the facilities, which were made eligible for IDA financing under legislation signed into law by Gov. Pataki in August.
IDAs previously had been allowed to assist for-profit facilities for the aging and, in fact, three had been approved in Erie County. At their monthly meeting Friday, IDA directors discussed amending their 10-year payment-in-lieu-of-taxes, or PILOT, policy to include the not-for-profit facilities for the elderly.
But board member Ed Stachura was troubled that not-for-profits already may be reaping rewards over and above those of their for-profit competition, but also to the detriment to the Town of Amherst.
"When we're giving inducements, it's because we're expecting a payback in jobs and full taxes to be paid in the future," Stachura said. "That payback should be the same for non-profits who don't have to pay taxes. We have to insure there is a benefit to the project."
AIDA bond counsel Nathan Niell pointed out that the tax-exempt bonds issued for the not-for-profit facilities would be 20 or more years in length. Thus, when the PILOT ran out after 10 years, a PILOT equivalent to full taxes would be paid for as long as the agency held title to the property, as long as the bond was being repaid.
Executive Director James J. Allen said the not-for-profits will reap big benefits in terms of the interest rate paid on the bonds. Currently, the spread between tax-exempt and taxable bonds is about two percentage points. Spread over 20 or more years, that equals big money.
"The companies we're talking to are not objecting to paying PILOTs," Allen said.
The board voted to amend agency policy to include facilities for the aging, but Allen said he would attempt to set up a meeting with the town assessor to give his board a better understanding of what the PILOTs actually are based upon.
In other action, the Amherst IDA board approved four sub-lease tenants totaling 9,950 square feet.
The largest was PC Assistance Inc., which is relocating to 6,000 square feet of space at 430 Lawrence Bell Drive from 5,000 square feet at 4700 Genesee St. in Cheektowaga.
The computer sales and service firm expects its employee roster will climb to seven from the current five within two years of relocation.
The board also approved an amendment to its project inducement and subsequent bond sale for AirSep Corp.'s project at 401 Creekside Drive.
In June, AirSep was approved for a $2 million expansion, including renovation of an existing 30,000-square-foot facility. Five months later, the inducement was amended to $4.18 million.
On Friday, another $820,000 was added to the inducement and bond sale amount, bringing the total project to $5 million.
The additional request using the Amherst IDA's assistance will allow AirSep to realize $32,800 in additional sales tax savings, for a total of $200,000; and $8,200 in additional mortgage tax savings, for a total of $50,000.
AirSep also is adding 10 more jobs to its November projection of 40.