News flash: The Gates Circle area of North Buffalo, once thought of as one of the city’s better neighborhoods, is now a "slum or blighted" area that "constitutes a serious and growing menace." In fact, the neighborhood "contributes increasingly to the spread of crime, juvenile delinquency and disease."
At least that’s the criteria cited in a bailout program the city is invoking to grant financial incentives to a prominent developer.
And all this time you thought it was the East Side that needed tax giveaways to incentivize redevelopment and growth? Silly you.
Instead, the Common Council this week declared the former Millard Fillmore Hospital site at Gates Circle a slum, a bureaucratic sleight-of-hand that entitles TM Montante Development to the type of tax breaks that critics say were designed to rebuild truly blighted areas.
Of course, Brown administration and Montante officials have a different take on things and insist they’re just utilizing the law.
But the bailout seems like a bastardization of the state’s Urban Development Action Area Program, whose "policy and purposes" section makes clear that it was intended to give cities a tool to redevelop rundown areas, not to carve out a doughnut hole within a nice neighborhood to shower tax breaks on developers.
To even make Montante’s project eligible on paper, the city had to include Delaware, Lafayette and Linwood avenues around the site – and even Gates Circle itself – to reach the law’s requirement that at least 60 percent of the site be municipally owned. They even had to throw in the vacant and deteriorating hospital parking ramp, which the city owns but plans to sell to Montante.
Such fancy map-making is tantamount to gerrymandering – but for dollars rather than votes.
And given the pending sale, how can the ramp possibly count in the 60 percent?
It just has to be city-owned at the time the site is designated an "action area," said Brendan Mehaffy, executive director of the city’s Office of Strategic Planning. A subsequent sale doesn’t matter.
Such maneuvers have prompted critics like attorney Arthur J. Giacalone to warn Council members that the city is turning "the statute on its head" because the intent of the law "is not to bail out a financially strapped developer when its plans for an ambitious private project stalls."
Neighborhood resident Daniel Sack probably summed it up best at the same Council committee meeting.
"This is a welfare program that I think is a good idea for places that deserve it. But not at Gates Circle," he said, citing the nearby Park Lane Condominiums and high-end homes on Chapin Parkway.
He’s right. But the whole dispute may well end up in court; and it could come down to the definition of "area." In my dictionary, that means a neighborhood. But Mehaffy says the statute is much more flexible and was used once before – some think perhaps on the Market Arcade project downtown.
"The statute is as it's read: It could be a single building, it could an entire area, it could be Gates Circle," Mehaffy said.
No wonder we can’t take the Shakespearean character’s advice and kill all the lawyers.
But beyond the probable legal fight, there’s a more fundamental question to get to.
Montante President Christian Campos said the $150 million project, dubbed Lancaster Square, requires a public-private partnership to make the numbers work and that this was envisioned even before partner Morgan Management of Rochester ran into legal problems. He said that is "something we’ve been open about and discussed with the community for years."
The UDAA program allows for full tax abatements for the first 10 years, then a declining schedule of abatements the next 10 years. But Mehaffy said it’s impossible to estimate how much the city will give up in tax revenue because the abatements are applied to each individual project as Montante proceeds with plans for apartments, condos, a store, a fitness club and other amenities on the 6.7-acre site – once the giant debris pile neighbors sued over is removed.
The project is not without its pluses, including MWBE and minority and female hiring goals during construction, plus a local-labor mandate.
In return for the tax breaks, Campos noted, the community benefits agreement also calls for affordable housing to make up 20 percent of the residential units – the type of mandate community groups pushing "inclusionary zoning" have been calling for. Council President Darius Pridgen, whose Ellicott District contains the site, said "the affordable housing component is the only reason I’m supporting" the project at this point.
Pridgen also emphasized that each individual project must come back for a Council vote before tax breaks actually are awarded, even though the Council on Tuesday unanimously created the "action area."
Still, that designation came just a week after Gov. Andrew Cuomo was here saying it’s time for the private sector to step up now that the Buffalo Billion public infusion has laid the groundwork for revival. Apparently, somebody didn’t get the memo.
And that brings us back to the fundamental question, which was raised by neighborhood resident and former city development official James Smith: Why is development in Buffalo so tough, and why can it succeed in some areas with much less help but not in others?
If we can figure that out, maybe we can stop having these fights about stretching the law and giving away the store just to get something built.