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Oil drilling machine maker gets tax breaks; Nearly $3 million set by ECIDA for Derrick

A Cheektowaga manufacturer that makes vibrating machines used by oil and natural gas drillers received nearly $3 million in tax breaks from the Erie County Industrial Development Agency on Monday to expand its factory by almost 50 percent.

Derrick Corp. is planning a $19.5 million project that is expected to create 36 new jobs over the next two years by building a 124,000-square-foot addition to its factory at 2185 Walden Ave.

The project will expand Derrick's manufacturing capacity at a 230,000-square-foot site that has been its home since 1954.

Derrick's high-frequency vibrating machines and screens can be used to filter out particles as small as 10 microns in width by customers, primarily in the oil and gas industry and the mining industry.

The company, which currently has 363 full-time employees and 76 part-time workers, also plans to purchase $7 million in new equipment as part of the expansion.

Derrick is receiving $2.9 million in property, sales and mortgage tax breaks through the IDA. The project is expected to generate about $595,000 in additional tax revenue during the 10-year period covered by the property tax breaks.

The IDA also approved incentives for several other projects:

*McGard was granted $482,000 in tax breaks for a $5 million project that will expand its Orchard Park factory by about 10 percent and add a new wastewater-treatment plant at the site.

McGard, which makes security products, wheel locks and chrome-plated lug nuts, is adding 24,500 square feet of space to its plant at 3875 California Road. The project is expected to generate about $85,000 in additional tax revenues during the abatement period.

*University Pediatric Dentistry received $90,000 in sales tax breaks for its $1.3 million project to move the 15-chair dental practice from Women & Children's Hospital to 1100 Main St. on the Buffalo Niagara Medical Campus.

The IDA deemed the project eligible for tax breaks because it provides medical services in an area that federal officials have designated as having a shortage of health care professionals, said Karen M. Fiala, the agency's assistant treasurer.

"It's an important addition to this portion of Main Street," said Buffalo Mayor Byron W. Brown. "The services they will provide are critically needed in this part of the city."

*Buffalo law firm Ricotta & Visco, in conjunction with developer Valledomo, was granted more than $230,000 in tax breaks for a $1.6 million project to renovate a building at 496 Main St. that previously housed the Happy Garden Chinese restaurant and whose top three floors have been vacant for more than 50 years.

The law firm will be the sole tenant in the renovated 11,440-square-foot building. The project is expected to add three jobs to the law firm's current work force of 13 employees, IDA officials said.

*I-Squared R Element Co., a Newstead manufacturer of silicon carbide heating elements owned by congressional candidate Jack Davis, received more than $675,000 in tax breaks for a $5.3 million project that will expand its factory by 40 percent.

The company plans to build a 36,000-square-foot addition to its 86,000-square-foot factory at 12600 Clarence Center Road. The project is expected to generate an additional $89,000 in tax revenues for local and county governments.

While the company told IDA officials that the project is not expected to add to its 70-person work force, Davis told The Buffalo News last week that he expects the expansion to create about 20 new jobs within three years.

*Sonwil Distribution Center was granted $175,000 in sales tax breaks for a $2 million project to purchase and install refrigeration equipment at the former Visteon plant at 4900 North American Drive in West Seneca, which is being converted into a dry and refrigerated warehouse facility.

A portion of the tax breaks also will be used to purchase computers and related equipment at the former Motorola plant in Elma, which is being converted into a multiple-tenant facility that will be marketed for back-office businesses.

IDA board member Michael H. Hoffert, who is president of the Buffalo AFL-CIO Council, said the agency should look into creating guidelines that would require companies receiving tax breaks to use locally based workers for their construction projects.

"Since it's local taxpayer dollars," he said, "I think we ought to keep the labor local."

e-mail: drobinson@buffnews.com

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