A $40 million fund that will be used to pay for improvements in the area around Seneca One tower got the go-ahead Wednesday from the Erie County Industrial Development Agency.
The agency approved the creation of an Accelerator Buffalo Fund, funded by tax payments from the office tower over the next 25 years, will be used to pay for infrastructure projects, such as the return of vehicle traffic to more parts of Main Street and other initiatives.
As part of the agreement, developer Douglas Jemal agreed to pay full property taxes on the office tower, foregoing $15 million in tax incentives that he could have been eligible to receive – a step that is "somewhat unprecedented for this type of project," said John Cappellino, the IDA's executive vice president.
The infrastructure program could include funding for streetscape improvements, the city's smart city initiative and other projects, Mayor Byron Brown said.
"Even in these difficult times, the business of building Buffalo must continue," he said.
IDA approval of the fund was essential because the agency will administer the funds. The Common Council approved the arrangement last week. The fund will use money Jemal pays as part of a payment in lieu of taxes agreement with the IDA.
The idea behind the fund is to create a mechanism to pay for improvements that will help attract new businesses and workers to the area around Seneca One tower, which Jemal is renovating after the complex sat vacant for more than three years.
The improvements will be centered in an area bounded by Huron Street, Elmwood Avenue, Ellicott Street and Canalside.
M&T Bank plans to open a technology hub with as many as 1,500 workers on 11 floors in the tower, although the bank said Wednesday it was halting construction on the project temporarily because of the coronavirus outbreak. Other tenants, including 43North, also have moved into the tower, while Jemal has added 115 apartments and other new structures to the complex.
The IDA also agreed to grant Steuben Foods more than $967,000 in sales and property tax breaks for its $25.6 million project to expand its Elma food and beverage production plant.
The project will allow Steuben to receive and store more fluid milk that is used in its products. The company also plans to buy additional beverage and dairy processing equipment to process, along with storage equipment. The company completed an 87,000-square-foot addition to its warehouse earlier this year.
The latest project is expected to create 20 full-time positions, with an average salary of a little more than $45,000. The company currently has 604 full-time and 20 part-time workers.
The IDA also approved more than $380,000 in sales and mortgage tax breaks for a $12.5 million project by affiliates of the Montante Group to convert a former medical office building at 1275 Delaware Ave. in Buffalo to 33 apartments and 10,000-square-feet of office space.
The apartments will include 22 one-bedroom units that will rent for $1,100 to $1,500 a month and 11 two-bedroom units with expected rents of $1,650 to $2,500 a month.
The building, built in the late 1950s near the former Millard Fillmore Gates Hospital, has been vacant for the last three years.
A $725,000 project to expand the home of the Marathon Cos. roofing products manufacturing company was also granted $92,000 in sales and property tax breaks. The project includes the construction of a 10,000-square-foot addition to its 23,000-square-foot facility at 3310 Benzing Road in Orchard Park.