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October 23, 2017 - 1:42pm

GCEDC board to consider three projects at Thursday's meeting

posted by Howard B. Owens in GCEDC, business.

Press release:

The Genesee County Economic Development Center (GCEDC) will consider final applications for three projects at the agency’s board meeting at 4 p.m. Thursday, Oct. 26, in the Innovation Zone board room at 99 Medtech Drive. All GCEDC Board meetings are open to the public.

The Board will consider final approval of incentives for a $450,000 capital investment by Manning Squires and Hennig in the Town of Batavia; a $4.5 million capital investment by Darien Lake Theme Park in the Town of Darien; and, a $4.3 million capital investment by O-AT-KA Milk Products in the City of Batavia.

Manning Squires and Henning is once again seeking to expand its footprint in the Town of Batavia. Earlier this year, the company invested $2.2 million for a 9,5000-square-foot expansion. The company is planning a Phase II component to expand to approximately 14,500 square feet, including a $450,000 investment for the purchase of construction related to equipment for which it is seeking approval of $36,000 is sales tax exemptions.

Darien Lake is seeking $360,000 in sales tax exemptions as part of a capital investment of $4.5 million for a new ride set to open in 2018. The tourism project will help retain 398 jobs at one of the Buffalo Niagara and Finger Lakes region’s most popular resorts.

The GCEDC board also will consider final approval of a 20,000-square-foot expansion project by O-AT-KA as part of a $4.3 million capital investment at the company’s plant on Ellicott Street. O-AT-KA is requesting approximately $370,000 for sales tax and property tax exemptions. The project, located in the City of Batavia, will help retain 308 jobs.

John Roach
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So, if O-AT-KA does not get the tax break, we are supposed to think 308 jobs are at risk? We could use that tax money to repair the bridges around here.

Howard B. Owens
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If a company can't remain competitive in a marketplace where their competitors in other markets are getting tax relief for moves and expansions, then, yes, jobs are at risk.

Here's an interesting podcast that includes a section on how both Boeing and Bombardier get tax subsidies from their respective governments (Boeing's comes in the form of lucrative no-bid military contracts) while pointing the finger at each other for using subsidies for unfair competitive advantages leading to the current trade dispute where the U.S. is threatening a 600 percent tariff against Bombardier, meaning Delta can't place a $5 billion order for new jets, meaning consumers get it with either older, less accommodating jets or higher ticket prices (my numbers may be off ... writing that from memory, but in that general ballpark).

https://itunes.apple.com/us/podcast/trade-talks-piie/id1270804213?mt=2#

that's the way the game is played these days ... counties against counties, states against states, countries against countries. If you want your community to have any hope of succeeding economically (even just to try and stay level), you play the game. Don't want to play? Accept economic decline.

It's been that way in this country since Alexander Hamilton used his incredible influence as Secretary of Treasury to help secure subsidies for a textile mill in Patterson, N.J., that he held shares in, including subsidies to help ferret away textile workers from Great Britain, overcoming their draconian protectionism, thereby creating both the textile industry in the U.S. and the city of Patterson (which wasn't even a dot on the map before Hamilton dreamed it up).

david spaulding
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If the people of Genesee co. really want to save some money hear me out.... first fire the smarter than thou GCEDC board. All of them Fired. Then hire me. I will work for an annual salary of 50 k with no other perks. I will need a p.o. and a cell phone for companies to contact me for tax breaks. I will also need a rubber stamp/ ink pad with the "approved" label.
If you own a company in Genesee co. I will approve your request for tax breaks, however please give me a reason why..... If nothing else please state " in order to retain jobs ".
Corporate people pay attention.. I am the man.. This can be the beginning to a nice friendship as I may seek higher office. With your support I can become Governor and bring you billions and billions of dollars in tax breaks, grants and low interest loans. That is billion with a B........ please show your support with a thumbs up vote.... Oh this is for corporate people only, the rest of you are taxpayers.... only poor people pay taxes... lmao

Ed Hartgrove
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John. I think you could've saved some time, if you had just typed, "Are we supposed to think there's a chance that O-AT-KA won't get the tax break?"

Dave Olsen
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There is no question that is how the game is played these days, Howard. But that doesn't mean we have to play too. Which is and has been the rationale for the GCEDC and their crony deals. I'll bet your mother told you the same thing mine told me about wanting to do what the other kids were doing.

Howard B. Owens
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If you're fine with Genesee County being mired in poverty and crime, good for you. I would rather see us pull out all the stops to try and grow economically, which means we compete by the rules the other teams are playing with, not tying both feet together with our hands behind our back and blindfolds over our eyes. Personally, I don't want to see Genesee County become a cesspool.

Dave Olsen
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That's a rather gloomy viewpoint on what would happen. I don't believe it. We have discussed in the past a couple of the high performing areas who have prospered without playing the game of giving out breaks to selected businesses. I'd like to see better support for existing businesses and finding ways to help them grow and succeed instead of great big flashy projects, that never seem to fulfill their promises. Let's empower and support individuals to do things on their own. Cottage industries, people each independently making something that when added together could be a product for us to market. No one is looking into these things, where's the innovations that put Genesee County on the map? our county government wants a grand savior to make it all ok again, so they can keep on growing government and have more money to spend, while people leave and local businesses fail. There has to be a breaking point and we have to be close to it. If we put too many of our eggs in one basket with some large company, they then start wanting to influence government policy. Happens all the time.

Dave Olsen
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And before anyone regurgitates the tired old stale biscuit "We only control 20% (or something around there) of the county budget, the rest are state mandates" May I remind us that last year, the county legislature said they would review each mandate and assess what would happen if they were ignored. I have never seen any evidence of that undertaking. I suggested last year one way to work on this. And I quote myself:

"I know this is the eleventh hour for this year, there only a few items left to debate and there is not enough time to address the wholesale changes which are likely needed in the scope of this county’s government, but there’s no better time to begin charting a new direction than right now. The day after the 2017 budget is finished is the day to begin working on 2018. I am greatly encouraged to read that you are interested in looking at each state mandated program and evaluating what would or may happen if ignored and state funding refused. I suggest that you break these down as far as you can and then set up a website listing them. Encourage citizens to take these on individually or in groups we form ourselves. Ask to have input and questions sent to the Legislators. There are some very bright and innovative people living here who would love the opportunity to help with the tough choices that need to be made. Especially if they can do so on their own schedule and their own terms and decide who they want to work with. I and some of you on the legislature have full time jobs and other obligations and time for this kind of thing is found sporadically. I think that inclusiveness of every Genesee County citizen shows respect. I believe that you will be highly impressed and intrigued with the responses you get. And your constituents will be glad you asked them.
Waiting for our state legislative representatives to get something done regarding unfunded mandates has proven to be mostly a waste of time. They can be helpful and I’m sure would like to be so. We need to tell them what we, the people of the county want. Hopefully they will stand up for us and not for their parties or leadership agendas. Let’s become pro-active instead of re-active or just subservient.
The key, in my very humble opinion to economic prosperity is lowering the cost and intrusiveness of government. We can’t do a lot about the federal and state governments, but we can set the example for other NY Counties, as we have throughout history. The best example is Genesee Justice, a successful program which was born from fiscal responsibility."

John Roach
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We have been giving out tax breaks for years and really have very little to show for it. We still have poverty and crime around here. But we seem to be told to give just a little bit more and all be good.

And Dave is right, we give tax breaks to businesses coming in that compete with the ones we already have. That just does not make sense.

Howard B. Owens
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Companies built with the aid of the government are far more common than most people realize. Most of Silicon Valley owes its existence to government aid in one form or another.

Our local retail businesses are asked to compete against the likes of Walmart, which has received billions over the years in subsidies.

The Internet wouldn't exist without the government.

My view is not gloomy. It's realistic. If your community doesn't compete on a level playing field, it will die.

The demographics are running against Genesee County. We have an aging population that is taking an exponentially growing portion of government assistance. Right now, these mandates take something like 80 percent of our local county tax dollars. At the current rate, in 10 or 15 years, it will be 100 percent.

Unless we have economic growth.

You think that can happen organically? Maybe it can. Maybe it can't. What evidence do you see of it happening organically? WNY has been in decline for 50 years. You can't blame that all on Albany. There are a lot of factors. Where are the entrepreneurs who will create organic growth? Entrepreneurs are the ones who built WNY but by and large, with exceptions, they've been AWOL for most of the 20th Century.

Hamstring the local economy by saying we shouldn't compete on the same level playing field as every other community is just nuts to me. Sure, I'd love to see all these incentives go away, along with a lot of the burdens placed on business by government. I'm sure we both agree on that. But that isn't going to happen in the next election cycle or the one after that. These are the cards we are dealt. I'd rather be a realist than an ideolog.

As for EDC, I look at it like a venture capital fund. VCs place a lot of bets. Many bets fail, a few succeed, but the whole fund needs at least one unicorn (a company with a billion valuation) to hit the kind of return investors expect. GCEDC has had some failures, a few successes, but has yet to find its unicorn. VCs know they will never find that unicorn if they stop placing bets.

You can argue that IDAs should make business gambles with taxpayer money. Perhaps that's correct, but that's just not realistic. Stop placing bets as a community and you lose. When the deck is already stacked against you, you lose big.

Dave Olsen
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We'll never know what might happen organically, if we don't just let things happen. Everything economics seems to have to be manipulated by someone who thinks they are smarter than everyone else. Yeah, it's reality the reality that was created through too much government at every level. So, if you want to be a cheerleader for people who steal your livelihood, and decide your future be my guest. I will not.

Howard B. Owens
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You can't really opt out of reality, no matter how hard you try.

And economics is all about competition for scarce resources and how people respond to incentives. And there are always incentives, whether they come from government, unions, or big businesses. No way around that. Again, reality.

Whatever tax policy the government pursues, it's picking winners and losers of somebody, providing incentives to one part of the equation or another.

The idea of some pristine laissez-faire economy of pure equilibrium is a fantasy. Free markets by their very nature are a force for creative destruction (see Joseph Schumpeter) so even in trying to achieve that sort of market is the government or society exercising control over your life and the lives of others. Unless you're a total hermit, you can't escape the forces of an economy that are beyond your control.

On the other hand, if you want control over your life, you recognize reality and play the game as the rules are written during your epoch.

david spaulding
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well folks are you ready to get rid of that gcedc ? hyde is getting quite a big buck and with the salary of his board (puppets) we are talking mega moolah.... They are going to give the tax breaks, there isn't too much you can do about that.. So fire the whole bunch of them, they can seek employment at one of the companies they gave a tax break to. Fire them and hire me.... I am cheap too.. 50 k/year and I can pound the "approved" rubber stamp just like they do. ...

Frank Bartholomew
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What was the hit to taxpayers for the mueller quaker disaster? And how much more are we going to give away to get that plant up and running again.How about Lowes,another waste.
These are things that sour people on these corporate welfare monies.How bout all those promised jobs,gone,just like our money.If the greed mongers need a bribe,we don't need them.We all know who opted out on those give aways.

Howard B. Owens
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Muller Quaker was a disaster?

Hmm ... company spends $206 million to build a state-of-art facility in a community. The largest such facility in the country. That company sells it for pennies on the dollar to another company that investing millions more, hiring hundreds of people, and expanding the facility, buying our oversupply of a local product, and this is a disaster?

Pepsi got relatively nothing in tax subsidies compared to what was promised because they didn't stick around long enough to realize the subsidies and didn't meet hiring quotas.

The same will apply to Hood if, on the off chance, they don't succeed. But it's a fraction of what they're investing and all tax abatements on taxes that would never be realized if the place had never been built in the first place. Would you rather there be no new business, no new jobs, just so there are no tax breaks that really cost you nothing?

Frank Bartholomew
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Just saying Howard,the promise of jobs is a falsehood that never reaches what was promised.I'm just tired of our money being used for these failed experiments.

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