Local government agencies are enjoying an additional $4.84 million in new revenue derived from projects approved for assistance from the Genesee County Economic Development Center since 2006, according to a report by CEO Steve Hyde to the County Legislature yesterday.
A key tax abatement awarded to qualifying projects is Payment in Lieu of Taxes (PILOT). While PILOTS afford companies some temporary tax relief on the increase in the assessed value of a property, the company is making PILOT payments and as the PILOT matures, new tax revenue is also generated.
Hyde said once all of the current PILOT projects on the books mature, additional tax revenue will surpass $7.5 million.
IN 2017, school districts in Genesee County received an additional $2.93 million in revenue from GCEDC projects, the county an additional $1.26 million, and local governments, $640,000.
"For every dollar, the county invests in economic development, we're seeing about $25 coming back in property taxes," Hyde said.
While GCEDC generates revenue for itself from fees charged to businesses that it assists, Hyde said it also relies on the financial support of the county, which has been reduced by 33 percent in recent years.
Meanwhile, GCEDC's workload has increased and the agency is actively marketing WNY STAMP in Alabama, which Hyde said continues to generate interest among site selectors, but for that $50 million project the IDA has only been able to budget $50,000 for marketing.
"That’s a bit of challenge right now but we work it and we’ll continue to work it," Hyde said.
GCEDC's support for business projects, Hyde said, have added 2.38 million square feet in new construction and another 1.28 million square feet in renovated space.
The number of PILOT projects in Genesee County in 2002 was 38. The peak was 2010 with 99. The number has fallen off steadily since then to 71 in 2017.
"Just because the number of our PILOTs are trailing off the past few years doesn’t mean it’s a bad thing," Hyde said. "It’s a good thing. It means we're graduating projects."
GCEDC is also working to help to finalize financing for the Ellicott Station project in Batavia. Hyde said it's the most complicated financing scheme he's worked on, and bringing state and federal requirements into line is a challenge. He's meeting today with the chief financial officer for Savarino Companies to work on some of those details. The IDA may need to adjust its initial PILOT plan for the project to help bring the pieces together.
The project has been delayed for months because of the difficulties faced by Savarino, the city and GCEDC in putting the financing package together.
