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AMHERST IDA DEADLOCKS ON REQUEST FOR TAX BREAK
BUFFALO ULTRASOUND'S COMPETITOR OBJECTED

A request by Buffalo Ultrasound for a sales tax break worth more than $70,000 on new imaging equipment it wants to purchase left the Amherst Industrial Development Agency deadlocked on Friday.

With one of Buffalo Ultrasound's competitors objecting to the proposed tax break on the grounds that it does not provide cutting edge technology or provide a service that is not generally available, the agency could not muster enough votes to either table the project or approve it.

Instead, after a lengthy debate, the board simply adjourned the meeting, with IDA officials holding out the possibility that it could hold a special meeting to take up the project again in a week or two, or consider it again at its next regular meeting on May 20.

At the crux of the discussion was the issue of whether the new imaging equipment, valued at $934,000, would meet the IDA's policy guidelines by offering a service that isn't readily available in the region.

Buffalo Ultrasound executives said the equipment is an essential part of a broader plan, in conjunction with a group of local nursing homes, physicians and other health services providers, to create a regional network that would allow widespread access to a patient's medical tests and imaging records.

Those records could be accessed from any health care facility or doctor's office that is part of the network, eliminating the need for costly, duplicate tests and allowing health care providers access to sharper, digital versions of the tests, said Michael Straeck, Buffalo Ultrasound's president.

"The equipment is the platform you need to build from," Straeck said. "The uniqueness of the project isn't so much the equipment as it is the regional approach to medical records."

But Dan McDonnell, the executive vice president of HealthTrac, an Amherst-based company that also provides portable diagnostic imaging services, said the new equipment is only marginally unique,likening it to comparing a Buick to a Chevrolet equipped with the OnStar global positioning service.

"They are merely reequipping the company to meet the technological standards currently used by other imaging providers in the area," McDonnell said, noting that HealthTrac currently uses systems that allow images to be shared digitally, although it is not part of the network Buffalo Ultrasound hopes to create.

"You need to segregate the project" between the equipment and the image delivery system, McDonnell said. "The machines are very similar to what we already have."

Some IDA board members said they were uncomfortable trying to judge the significance of the Buffalo Ultrasound proposal and suggested seeking an independent review from experts.

"Is this tweaking technology or more of a breakthrough," asked board member Frederick A. Vilonen, who failed in his efforts to table the proposal until a review could be done and voted against approving the project. "I'm not in a position to say."

James J. Allen, the IDA's executive director, said finding qualified local experts to review medical projects has been virtually impossible because of the close relationships within the region's medical community. Allen recommended that the project be approved because it would provide a unique service.

Board member Randall Clark suggested seeking experts from other areas, including Cleveland. "If 30 days is so critical as to whether this project goes forward or not, we really ought to be concerned," he said. "There are two good companies sitting here. One says yes. One says no . . . I don't know how to opine on that."

Clark later bowed out of the debate after realizing that one of the developers of the imaging network holds a position with Lifetime Health Systems, where Clark serves as a director.

Buffalo Ultrasound eventually hopes to move to a new facility, ideally in the area around Sheridan Drive and Harlem Road, and has been working with a developer, although that part of its expansion plans have not been solidified.

Delaying the tax break for the new equipment would make the project more costly, although Straeck said after the meeting that "we're going to move forward."

Board members Robert Miller and Barbara Batchen opposed efforts to table the project and voted in favor of approving the sales tax incentives. Board Chairman Paul A. Quebral supported the efforts to table the project. Neither effort succeeded because they failed to get the four votes required by the agency's rules.

The Amherst IDA has sparked controversy in the past with its aid to medical projects. The IDA in 2003 granted $1 million in tax breaks to Excelsior Orthopedics to build a new office and surgery center on Sheridan Drive in Amherst. That year, it also awarded more than $300,000 in tax breaks toProScan Imaging so it could open a center with the strongest magnetic resonance imaging equipment in the region.

Those tax breaks, and others, prompted County Executive Joel Giambra to propose eliminating the Amherst IDA in favor of a single, countywide development agency. Those efforts faltered, with the county's six IDAs instead forming a task force to revise and clarify eligibility guidelines.

e-mail: drobinson@buffnews.com

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