Reprinted from Dunkirk Observer 7/28/10
The Chautauqua County Industrial Development Agency is on its way to making development a more favorable proposition in the county. Meeting Tuesday morning at JCC North, the CCIDA Board of Directors approved a resolution to lessen the tax burden on improvements developers make to certain properties.
The change to the agency’s Universal Tax Exemption Policy will continue to go forward as the board approved notifying any affected taxing jurisdictions, along with scheduling a public hearing for those entities and members of the public to make comment, on the proposed changes.
If eventually approved, the plan, put together by a CCIDA committee, would provide similar benefits as those in other counties, according to CCIDA Counsel Jonathan P. Taber, who said an Oct. 1 effective date is proposed.
Meeting that date may be a little difficult.
“We have to seek input from all of the affected taxing jurisdictions in the county. That means input from every school district, the county itself, both cities, every town, village, every single taxing jurisdiction,” Taber said. “I don’t even know the exact count, I think there’s somewhere around 60. From a process standpoint, all this resolution does is authorize the staff of the agency to take the amended Uniform Tax Exemption Policy and to provide a copy of the proposed changes to all of those taxing jurisdictions.”
The second part of the process would be the public hearing on the proposed changes.
“What is contemplated is after those actions are taken we will probably receive some comment back from taxing jurisdictions,” Taber explained. “We may receive public comment from the public hearing. the staff will then report those comments back to the board and the board will then consider whether to approve, whether to make some changes to the proposal, or whether to approve it.”
Taber said there would be no changes to the board’s current policy on sales taxes and mortgage taxes which allow the IDA to waive them for certain projects.
The current policy UTEP and PILOT programs provide for qualifying projects to receive a 10-year real property tax abatement equal to 50 percent of the value of the improvements made to the property. Under certain circumstances, if a compelling justification exists, the agency may determine to grant a real property tax abatement that varies from the Agency’s uniform tax exemption policy.
Under the proposed plan, instead of the 50 percent abatement for 10 years, there will be a changing percentage as time passes. Years one and two would provide a 90 percent abatement on improvements. That would drop to 80 percent in years three and four; 70 percent in years five and six; 60 percent in years seven and eight; and 50 percent in years nine and ten.
Adaptive reuse (reusing blighted buildings) and tourism destination projects will also see a change in their abatement schedules, now the same as the improvement abatements.
The proposed adaptive re-use project abatement schedule provides a 90 percent abatement in years one through five; 70 percent in years six through 10; and 50 percent in years 11 through 15.
Tourism destination projects abatement rates would change to 100 percent for years one through five; 75 percent in years six through 10; and be set at 50 percent for years 11 through 15.
“I do want to point out it’s always been the policy of this IDA that the IDA’s involvement will not result in a reduction of the tax revenue received by the jurisdiction,” Taber stated. “In other words, even though the IDA is offering a real property benefit, it’s important to understand the jurisdictions are still getting at least the same amount of money they got the year before as they’re going to get under the program.”
The IDA also passed two other resolutions.
SolEpoxy, Inc. of Olean is seeking assistance in the asset purchase of Henkel Technologies of Olean which is headquartered in Dusseldorf, Germany.
According to the resolution, terms for the $75,000 Chautauqua Revolving Loan Fund working capital loan request include a five-year payback at 4 percent interest with payments made monthly.
The CCIDA’s interests will be secured by a second or third position with STEDO on the company’s real estate located at 211 Franklin St. in Olean. Offered as collateral to creditors are the company’s assets, machinery and equipment and the personal guarantee of Jeffrey Belt and key-man life insurance on Belt in an amount equal to what the CCIDA is owed.
The funding will be disbursed at the asset purchase and/or closing, according to the resolution, which passed 6-0, with member Doreen Sixbey abstaining.
Also approved was a request for an Al Tech Working Capital Loan for $55,590 that will go to Paradise Yacht Cruises, Inc. in Celeron.
The funding will assist in the purchase of a Y-40 Marine Hydraulic Yard Trailer that will allow for the inspection of the bottom of the hull for the Summer Wind. The purchase will also allow the company to provide service to other boats. The loan is for five years at 4 percent with monthly payments and will be secured by a first collateral position on the new equipment and the personal guarantee of, and life insurance policies on owners Richard Willman and Marilyn Brainard.
The next meeting of the CCIDA is set for 10 a.m. on Aug. 18 at CCIDA headquarters, 200 Harrison St. in Jamestown.
By GIB SNYDER OBSERVER