CCIDA offering variety of incentives
Bill Daly often refers to industrial development ag-encies as economic development agencies.
“One of the biggest misconceptions about IDAs is that they’re industrial,” said the Chautauqua County Industrial Development Ag-ency administrative director. “In fact, IDAs should be economic development agencies.”
Through a variety of loans, tax-exemption policies, payments in lieu of tax agreements and bonds, the CCIDA is able to provide assistance to businesses in the county’s towns, villages and cities that otherwise isn’t always available.
According to the New York State Industrial Development Agency Act, “The purposes of the agency shall be to promote, develop, encourage and assist in the acquiring, constructing, reconstructing, improving, maintaining, equipping and furnishing industrial, manufacturing, warehousing, commercial, research and recreation facilities including industrial pollution control facilities, educational or cultural facilities, railroad facilities, horse racing facilities, automobile racing facilities and continuing care retirement communities … And thereby advance the job opportunities, health, general prosperity and economic welfare of the people in the state of New York and to improve their recreation opportunities, prosperity and standard of living…”
In the past, Daly said, the CCIDA has been very “vanilla” in the projects with which it has gotten involved. However, recently it has begun to branch out in its projects, to include incentives to retail businesses – for example – in the former Quality Markets plaza in Lakewood.
“For years, IDAs couldn’t do retail projects,” Daly said. “Then, there were a number of years we could. We wouldn’t have done that, but the village of Lakewood mayor asked us to do it. It was a very serious request.”
Daly said the CCIDA tries to reach out to industrial and commercial warehousing in order to see whether it is able to help with projects. However, there are cases – such as for a hotel project in the town of Ellicott – where developers approach the CCIDA.
When it comes to offering incentives, there are several routes the CCIDA is able to take.
According to Daly, all public authorities, not just IDAs, have to have a tax exemption policy called the Uniform Tax Exemption Policy.
“We never take away the existing property tax,” Daly said. “We only abate the increased, or new assessed value, based on whatever they’ve done to create a new value that would be taxed higher. The incentive is to get them to build.”
When it comes to property tax abatement, the CCIDA follows a standard abatement of 90 percent for the first two years, 80 percent for years three and four, 70 percent for years five and six, 60 percent for years seven and eight and 50 percent for years nine and 10. After the 10th year of abatement, the property owner must pay taxes in full.
“On a case-by-case basis, we can deviate the time – we can shorten it, we can make it longer – and also the PILOT percentage,” Daly said. “So, if there was some extraordinary project … Maybe we would only want to give them 50 percent for 10 years. We can change it.”
The CCIDA also has abatements in place for adaptive re-use projects, tourism destination projects and small alternate energy projects. Additionally, projects receiving an abatement, other than small alternate energy projects, will be eligible for a Payment in Lieu of Tax agreement.
For PILOT agreements, the CCIDA considers various factors of the project, in order to determine whether a PILOT will be issued and what amount will be paid.
The CCIDA is also able to grant sales and use tax exemptions, as well as mortgage recording tax exemptions to projects it sees fit.
The way the PILOT program works, Daly explained, is that the developer will make the payments directly to the CCIDA. The CCIDA then will break up the payments between the city, county and school district in the same proportions each would receive if being paid in full.
The policy of the CCIDA, according to Daly, has been not to change how PILOT payments are made to the municipality, school and county unless it is asked specifically to do so.
According a presentation made to the Chautauqua Count Legislature in February, since 2006, the CCIDA has made 54 Al Tech and Chautauqua County Revolving Loan Fund loans in the amount of $14,382,673. These loans leveraged an additional $56,688,764 of investment into the county. And, the loans were projected to retain 2,771 jobs and helped create 532 additional jobs.
The CCIDA has also closed 20 payment in lieu of tax agreements, which Daly said created 266 jobs as of the end of 2011. The agreements generated $10,919,643 in payments to the taxing jurisdictions in 2011.
Additionally, the CCIDA has issued five tax-exempt bonds in the amount of $103,206,000, which have created additional capital investment of $234,885,000 in Chautauqua County.