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Bigger tax credit for historic buildings awaits Cuomo Legislation will give such development an equal financial footing with new construction in the suburbs

Only the signature of Gov. Andrew M. Cuomo remains needed to enact an expanded tax credit for historic buildings that gained final legislative approval Tuesday by the Assembly.

And while the governor's office says only that he will "review" the new legislation, Albany supporters say they are confident of his approval and a renaissance for downtown buildings across upstate New York. Now, they say, the tax break will allow historic buildings to compete on an equal financial footing with new construction in the suburbs.

"It makes all these bigger projects more doable," said developer Rocco R. Termini, president of Signature Development Co. "If this bill is signed, I'm ready to close on AM&A'S tomorrow, and that's been an eyesore for 20 years in the central business district."

Termini should know. He used a recently passed law providing up to $5 million in historic tax credits to rejuvenate the now glitzy Hotel Lafayette in downtown Buffalo, which had deteriorated into a cheap lodging place a century after its construction. But the new legislation -- championed in the Assembly by Democrat Steve Englebright of East Setauket, Long Island, and in the Senate by Republican Mark J. Grisanti of Buffalo -- now raises the limit to $12 million.

As a result, Termini said, bigger and more complicated projects could be developed, including Women & Children's Hospital when it moves to the Buffalo Niagara Medical Campus in a few years. "In two years, what are we going to do with Children's Hospital?" he asked. "We're going to need all the help we can in converting that building into mixed use."

Termini has preliminarily agreed to renovate the old AM&A's department store on Main Street but has always maintained that the complexity of renovating the historic site depended on an expanded tax credit program.

Assemblywoman Crystal D. Peoples-Stokes, D-Buffalo, who along with Assemblyman Sean M. Ryan, D-Buffalo, emerged as a driving force for the new legislation, said a host of deteriorating edifices can be eligible for rehabilitation because the tax credit allows them to compete with new builds. "There will be almost immediate benefits for projects in downtown Buffalo," she said. "It even bodes well for development of Central Terminal, because success will breed success."

"It drives money toward buildings when previously it would not have been economically feasible," Ryan added. "We're going to see some big projects in downtown Buffalo."

The measure passed the Assembly with only one dissenting vote, Ryan said.

Backers say it will spur development of run-down buildings -- especially in older upstate cities -- into new uses, from residential spaces to mixed-used development of commercial and residential projects.

Englebright, the Long Island Democrat, said he was spurred into sponsoring the bill after viewing New York City sprawl engulf former farmland on Long Island.

"It was clear to me that disinvestment in New York City and all the large cities of the state was really driving sprawl," he said, adding that "chances are good" that Cuomo will sign the bill.

"While many eyes will look at this, the governor himself is clearly aware of the importance of historic preservation as an economic development tool," he said. "He is a patron of history and a 3-D thinker who also 'gets it.' " He added that visiting Buffalo put him "in awe of the city's architecture" and helped convince him of the special need for upstate.

The legislation, though, will have a fiscal impact on the state's budget, and Cuomo has publicly expressed a reluctance to add new cost items to the fiscal plan in the final days of the 2012 legislative session.

Still, Peoples-Stokes and Ryan said they are optimistic Cuomo will grant final approval because of the measure's potential to create construction jobs and permanent positions as well. "I'm very confident the governor will be supportive because he understands the imminent impact it will have on upstate city centers like Buffalo," Ryan said.

email: rmccarthy@buffnews.com