AMS Servicing could be adding 195 jobs at its mortgage servicing center when it moves from Depew to larger space in the old Motorola plant in Elma. The Erie County Industrial Development Agency granted the firm $219,000 in sales tax breaks Wednesday to help the move.
The $2.5 million project involves AMS leasing 35,000-square-feet in the former Motorola plant – more than double the size of its current site at 3374 Walden Ave. The company, which currently has 270 employees, also has an option to take another 30,000-square-feet if future growth requires it.
The company is growing following equity investments from GSO Partners and EGF Capital that will roughly double the number of mortgages that AMS is servicing from 18,000 today to between 35,000 to 40,000 by the beginning of March. It is also receiving $1.5 million in tax credits through the state’s Excelsior Jobs Program.
AMS, which was founded in 2008, also looked at sites in Dallas and Jacksonville, Fla.
The IDA also approved $1.35 million in tax breaks for North American Salt Co., which plans to build a facility to import, package and ship bulk salt from a six-acre site in the Gateway Trade Center in Lackawanna.
The $7.3 million project would mark the first time in roughly 20 years that new buildings have been added to the Gateway site, located on the former Bethlehem Steel property, said John Cappellino, the IDA’s executive vice president.
But because the company plans to create only eight jobs at the highly automated facility, some IDA board members questioned the value of providing incentives that amounted to almost $170,000 for each job that would be created.
“For the investment, that’s a low number of jobs that will be created,” said Betty Jean Grant, the Erie County Legislature’s minority leader.
Erie County Executive Mark C. Poloncarz, however, supported the tax breaks, calling the project ideally suited for the former steel plant site and an opportunity for the IDA to support smaller-scale projects that will create blue-collar jobs.
“This is a perfect location,” Poloncarz said. “It strengthens the community by taking advantage of an existing site, rather than going to a new site. So it’s smart growth.”
Kevin Thimmesch, senior director of global sourcing at North American Salt’s ultimate owner, Compass Minerals International, said the company selected the Lackawanna site after looking at other potential locations from Cleveland to Oswego.
The company plans to build a dome that can store 20,000 tons of salt on the property, alongside a separate 28,000-square-foot building that will house the company’s packaging, warehousing and distribution operations. The company will take advantage of the docking facilities on the site to bring in salt by lake freighter from its mine in Goderich, Ont.
The IDA also approved a clawback policy that outlines the process the agency will follow if a company receiving tax breaks fails to come within 85 percent of its promised job creation or investment.
The policy allows the IDA to recover all of the sales and mortgage tax breaks granted to that company, should the agency’s board of directors decide that the shortfall was not caused by a good reason, such as a weak economy or weakened markets. The policy also allows the IDA to recapture a portion of the property tax breaks granted to a company during the years that the firm has fallen out of compliance with its investment or job creation targets.
Property tax breaks would not be subject to a clawback during years when the company met its job and investment targets.
The policy also gives the agency’s board of directors “broad discretion” in determining whether to actually recapture tax breaks from companies that don’t meet their job creation or investment targets.
The five other IDAs in Erie County are not expected to adopt the same policy, said Richard Tobe, the deputy county executive who heads the agency’s policy committee. Officials from other IDAs have said the ECIDA policy is too heavy-handed and cumbersome, and could scare off potential development.