BOARD OF DIRECTORS MEETING
County of Chautauqua Industrial Development Agency
200 Harrison Street, Jamestown, NY
September 17, 2013
Michael Metzger Chairman
Kim Peterson Member
Doreen Sixbey Member
Hans Auer Member
Fred Croscut Member
Dennis Rak Member
Also in attendance:
William Daly Administrative Director/CEO
Rich Dixon CCIDA Chief Financial Officer
Jonathan Taber Counsel
George Cregg Bond Counsel
Carol Rasmussen CCIDA Staff
Lawrie Taylor CCIDA Staff
Kristine Morabito CCIDA Staff
Susan Casel CCIDA Staff
Jayesh Patel Boxwood Hotel
Satish Patel Boxwood Hotel
William Salter Boxwood Hotel – Longview Consulting
Vince DeJoy City of Jamestown
Bob Kenyon City of Jamestown
Gene Aversa Resident
Peter Lombardi Jamestown Renaissance Corporation
Dave Leathers Jamestown BPU
Jason Sample WRFA Radio
Dennis Phillips The Post Journal
Absent Board Member(s): David Bryant and Greg DeCinque
I will now call the County of Chautauqua Industrial Development Agency (CCIDA) Board of Director’s meeting to order. Today is September 17, 2013 (10:02 am). This meeting is being held at CCIDA, 200 Harrison Street, Jamestown, NY.
I will now have roll call.
Fred Croscut – Here, Doreen Sixbey – Here, Hans Auer – Here, Kim Peterson – Here, Dennis Rak – Here, and Michael Metzger – Here. We have a quorum and will begin the meeting.
We are now in regular session. I would like a motion to accept the August 22, 2013, minutes.
All in favor indicate by saying Aye.
The minutes are approved.
We want to recognize all of our guests here today. We appreciate you coming. We have received correspondence from some of you that has become part of our record either at the Public Hearing, or sent through email from Ray Fashano. Mr. Aversa was at the Public Hearing as was Mr. Leathers, Mr. DeJoy, and Mr. Kenyon. There is a letter in your packet from that.
What I would like to do is move to new business
Dennis, please read the first Resolution.
Resolution of the County of Chautauqua Industrial Development Agency Pursuant to the State Environmental Quality Review Act Concerning the Determination of Significance for Boxwood Hotel LLC.
This is a SEQR Resolution for the proposed hotel project out at Exit 12. It is a resolution stating that after review the project will not have a significant negative impact on the environment.
If there is no further discussion, I will take a roll call vote.
Fred Croscut – Aye, Doreen Sixbey – Aye, Hans Auer – Aye, Kim Peterson – Aye, Dennis Rak – Aye, and Michael Metzger – Aye.
The resolution is passed.
The next Resolution that we have is generated with everything that would be available to someone who has filed for benefits under the CCIDA. We are going to be amending that resolution and voting on the amended resolution.
Jon, I would like to ask you to explain.
The Resolution included in the Board packet is a Resolution approving the whole array of financial assistance for the proposed hotel project. That would include sales tax exemption for building materials in connection with the project; that would include mortgage tax exemption if they are financing the project; as well as real property tax abatement. The total uniform tax exemption policy. So, that is what is presented before the Board. I have had conversations with the board about the financial assistance proposed for this project, and the board has received input from the community as a result of the public hearing.
Ok. We’re looking to the resolution with only approved to mortgage, sales tax, recording fees.
Well, as I understand it total would be to amend the resolution to limit the financial assistance to only sales tax exemption with the project and mortgage tax exemption which will provide no real property tax abatement to that project. Which will mean that project would be privately owned and would pay the property tax owed at the full assessed value.
Just so the Board’s clear. Businesses, commercial developments, industrial developments by NYS statute, are entitled to under title 485b. Under 485b, it’s very similar to a PILOT, it’s not a PILOT. There is a 50% reduction in property taxes the first year, then 45%, 40%, 35%, 30% – down 5% a year – then the 11th year, it’s 100% full tax payments.
The discussion has been that the sales tax is very significant on new build. It’s also very significant to a hotel project, because anything in there with a useful life of over a year would also receive the sales tax exemption. You can imagine in a hotel all the furniture, phone systems, security systems – they all have a useful life of over a year. So, this in summary, with the sales tax exemption in construction materials, items with useful life of over a year, mortgage recording tax would be abated, and that’s it in this amendment. We would not be doing a PILOT in conjunction with this resolution.
Excuse me Mr. Chairman, is it possible to address the Board.
Unfortunately not because we are in open public session, there are no comments at this time.
Can the applicant ask any questions of the Board?
I would say that, certainly there have been opportunities for public comments with the public hearing and also through correspondence. I think it would be up to the Chairman if he wanted to permit additional comments at this time, but I don’t think it’s a requirement.
What is the feeling of the Board?
We just didn’t know, with the change in the resolution, if we could address it. That’s all. It’s not a problem.
Mr. Chairman, reading the letter last week, never really had a chance to address the Board. At the Public Hearing, there were not one Board member present, and would appreciate the opportunity to have the chance to address the Board on this upcoming resolution.
Just to clarify, the City did provide correspondence to the Board. The letter was read at the open public hearing. All of that information was collected, transcribed, along with verbal comments. We provided that to every Board member. So, despite the fact that Board members were not present at the public hearing, and frankly, Board members are almost never present at the public hearing. All of the information that was collected, not only during that time, but some came in since that time – there were some additional letters provided by interested parties after that meeting, were provided to the Board members. The Board members were given that well in advance of this meeting so they could review the information. So, all of those comments – I just want to be clear – have made it to the Board members. They were able to read and use that information to help them to form their opinions today on whether to approve the project.
Mr. Chairman, the one thing that we wanted to address, was the question that was posed by the City. Are these tax payer subsidies or abatements basically absolutely necessary for this development to go forward? We haven’t heard any type of response as of this point. That’s basically the question that I think should be posed in a public forum – are these tax abatement absolutely necessary but for this project would be going forward.
It was all up on the table when we met in Dunkirk. That was one of the things that was discussed with the whole Board. That was asked and answered by the applicant.
The answer Vince is yes. To have the project go through, they wanted the abatements. That was at the Dunkirk meeting.
They wanted or needed the abatements?
Yes, they said they need them or they will not do the project. Is that correct?
Is there anything more?
I’m all ears. I don’t want to exclude anyone from sharing their opinion. I think we’re very well informed, but if there’s anything else – personally – I don’t know if I have the right to be all ears on this – but I am. Where are we going Vince? Is that the main question, the only question, or is there more that you want to talk about?
Well, I honestly haven’t seen any of the documentation or necessary – what would make this absolutely necessary for this project to go forward without these tax payer, tax abatements. I know that the developers will have now three properties within about a two mile radius. There’s something called “complexing”, in this environment of hotels, where they will be using probably utilizing some of the same laundry facilities, same general manager, engineer, this isn’t a big job creator project. Perhaps they might need to hire some housekeeping staff, but I don’t see this as a job generator. And the fact I still believe that any project that comes in this well mature development site here at the Exit 12 interchange – two hotels, numerous restaurants – are they all going to be asking for and should they not all get some type of sales tax abatement, mortgage recording tax abatement, and so forth. It seems to open up the case for any new development there, and it’s already a mature development site, and it’s hard for us to believe that these subsidies are absolutely necessary for this project to go forward.
Well, as part of the record. We did receive and were petitioned by the Town of Ellicott to move this project forward. They thought it was essential to what they had planned on their three exits within the Town of Ellicott. They felt it wasn’t a mature site, and that it was essential for their economic development moving forward.
Who was that with the Town of Ellicott? Cecil Miller.
The school district also approved this unanimously.
Yes, that didn’t appear in our record – that was an article in The Post Journal – that they whole heartedly supported it, as was the Town Supervisor and the Town Council.
I think, the answer to the question, is that we would be open to providing assistance any way we could to further development or projects on that exit, or anywhere else.
As a matter of fact, Hans, we’ve had meetings with the Town of Ellicott for that exact purpose. They saw that, the three exits on I 86, some opportunity for more development, more jobs, and certainly more tax base in their community – attracting people off of I86 and into the Town of Ellicott and probably the City of Jamestown – just the community in general. That’s been the conversations we’ve had with them. They certainly came through and expressed this in their letter that they sent to us.
Are there any other comments?
Can we address that question as long as it was asked? Just a couple of things – we’re building a hotel in Niagara County right now. In Niagara County we have the full venue including the PILOT. They’re a community that has had a disastrous impact on manufacturing and they’ve jumped that on tourism, and that’s why they’re willing to do that.
I think Chautauqua County has had some issues with manufacturing and I think tourism is the next largest growth opportunity for the County. We’re looking at not only this location; I know the IDA is aware that we’re looking at a second location that could be coming in within a month. Quite frankly, we’re looking at a third location.
How we’re going to progress in the County, a lot is going to depend on the County’s attitude towards tourism and your willingness to work with us to grow it as an industry. We’re not saying we’re coming, we’re not coming, whatever. We know the job that you guys have is a very difficult job. But, I’m hearing questions here about how we’re going to manage our business? How we’re going to do our laundry. Are we going to consolidate our laundry with three hotels? I don’t know where that’s coming from. I don’t know what it even means.
It comes from an industry expert.
Each hotel is a stand-alone operation. Each new hotel will create anywhere from 22-24 jobs. Today’s operation in a hotel business you have to have your own laundry facility, you have to have your dedicated GM at the property.
Those days are gone – 10-15 years ago where one central management company used to manage all their labor power. Those days are gone.
In today’s time, we go through each facility. You are welcome to inspect any of them. They are all drawn on its own. It is like a separate entity running a separate business. We are common owner, that doesn’t mean that nothing.
Another thing is on how we think this business should be. It’s beneficiary to us – look at Genesee County – a Town called Batavia. This year they are up about 25% increase in collecting the bed tax. A couple of years ago, two hotels came in. A lot of local hotel owners came out against it. Still IDA approved the project, and now having two new hotels added, everybody, including the older existing hotels benefit from it. Batavia has probably one of the most increases in revenue this year. When you compare that with either Niagara Falls or Transit Road, which is the next closest exit, we found that Erie County does not do benefits, so all the growth stopped at Exit 49. Everything exploded in the last two or three years at the Batavia exit. They’re giving us the benefits. On the record – they have a 25% increase in the bed tax collection – last year versus this year.
I was at the Public Hearing. I was at the Public Hearing for two reasons. I adamantly disagree with the PILOT program being offered to the group. I see that this Board has changed, and I’m very pleased to see that. I agree that the offer of abatement is appropriate. As a small business, I received an abatement program which I very much appreciated, and it did help our business. They bring money in from outside the County. My little company does also. We bring over $4 million a year from outside the states. So, I understand that.
My biggest concern is that this Board and this County deal with the traffic issue. It is absolutely a bear. You need to travel north Main Street. I built a home off of West Oak Hill. So now I’m experiencing the new Tim Horton’s – by the way they did not receive an abatement – and other traffic issues. So, I would urge that this Board in discussion with the County or the State take a hard look at some long term strategy, if the goal is to develop retail on North Main Street – to deal with the traffic pattern. You can’t even get off I86 on North Main Street sometimes and turn left if you’re coming up from Falconer or whatever. It’s a huge issue. Take that money and focus on the traffic pattern and what’s going to happen, because the safety issue is going to be just phenomenal. Thank you.
Gene, those are great comments. I think as this develops more, there will be more development there because of the hotel. There is already development on the north side of the exit. That could even add more traffic. The comments are well taken. We certainly as a County will bring that up with George Spanos, Director of Public Facilities. That is a State highway – Route 60. We’ll look at all of this.
By the way, I get to compliment Mark Geise, from our Department of Planning and Economic Development. When the Tim Horton’s was being built there, the design came from a recommendation from our Planning Department when they got the notice of that building going there. They went and helped actually design that traffic flow.
There is another issue that’s developed – the topography of North Main Street. If you’re coming out West Oak Hill, you come up a little hill, if you’re traveling in to the City. Sometimes when that traffic is moving so fast, you don’t have time to get off of West Oak Hill on to North Main. So that’s my major concern. All up and down the road there is going to be issues. Thank you.
Mr. Chairman, just one last comment. I just wanted to make this absolutely clear that the City of Jamestown is not opposed to this project. As a matter of fact, we welcome this project. We think it’s great that they’re willing to invest the resources here. We just question whether any tax abatement subsidies is necessary for this project to go forward. That’s our position, and I’d just like to make it know that we are not in any way opposed to this project.
Thank you – any other comment or question? If none, I would entertain a motion for the amended Resolution.
I have a motion and a second. Is there any further discussion?
Hearing none, I will take a roll call vote.
Fred Croscut – Aye, Doreen Sixbey – Aye, Hans Auer – Aye, Kim Peterson – Aye, Dennis Rak – Aye, and Michael Metzger – Aye.
The motion is carried unanimously.
Next on the Agenda is the Treasurer’s Report.
An overview of the balance sheet was given.
*Guests left during the report.
Thank you – if there are no questions, may I have a motion to accept the Treasurers report?
I so move.
All in favor?
Ayes all around. The Treasurer’s report is accepted.
I would now like to move for a motion to conduct an executive session to discuss the financial and credit history of certain companies.
I so move.
All those in favor.
Ayes all around.
We are now in Executive Session.
Executive Session begins at 10:27 a.m.
Executive Session ends at 10:35 a.m.
We are now in Regular Session.
Is there any Old Business to come before the Board?
There was general discussion regarding the NYS Comptrollers Report. An article in the local paper referenced data from the report, and compared us to Cattaraugus IDA. A response will be made explaining the article.
It was suggested that the Board receive information prior to it being published so they are prepared to answer questions.
If there is nothing else, may I have a motion to adjourn?
All in favor indicate by saying Aye.
This meeting is adjourned. Meeting adjourned at 10:42 a.m.