savarino companies

Genesee County Economic Development Center officials have severed their ties with Savarino Companies and asked for more than $1 million of tax benefits back, Senior Director of Marketing and Communications Jim Krencik says. 

“This action includes cancellation of the lease leaseback agreement, the tax agreement (payment in lieu of taxes) and the sales tax exemption agreement, and have returned the three parcels involved back to the taxable side of the tax rolls,” Krencik said Tuesday. 

The EDC officials sent Ellicott Station LLC and Ellicott Station Commercial LLC related legal notices due to their “lack of curing of the default on our local tax agreement,” Krencik said. 

He referred The Batavian to an explanation CEO Steve Hyde gave The Batavian in an Aug. 23 article. 

“To clarify, the majority of the GCEDC financial agreements for the project are termed over 30 years that start following the completion of the project. These are structured as performance-based. Additionally, the project was notified in July that it is in default of its GCEDC financial agreements and is currently in a cure period to meet the goals of a workforce housing project,” Hyde said in the August article. “In light of the news yesterday, the project being in default to our financial agreements enables the GCEDC to have a greater role in ensuring a positive solution as we work with all parties involved. We continue to work with the City of Batavia towards this goal."

On Tuesday, Krencik said, “Additionally, we have issued a demand letter to Savarino Companies demanding repayment of the sales and mortgage tax benefits enjoyed by the project to this point, and we are attempting to claw back $1.1 million of those benefits.”

One of Savarino’s Ellicott Street properties was also fined for neglected property maintenance, along with a number of others, to the tune of an extra $30,000 for city cleanups of grass, weeds and debris, City Manager Rachael Tabelski said this week.

During Monday's City Council meeting, Tabelski asked council for a budget amendment to increase the expense line for “multiple grass, weed, and debris violations” this year. While 85 percent of the time, residents will take care of the issue once they’re cited, she said, other times, “we do have to go in and either cut the grass ourselves or remove debris.”

Tabelski gave The Batavian a list of citations for Savarino Companies earlier this year that included lack of property maintenance, including overgrown weeds, debris on the premises, and rank vegetation, for Ellicott Station and not securing the partially finished apartment complex on Ellicott Street. Savarino halted work on the project this summer after shutting down his company due to financial issues. 

Councilman Bob Bialkowski asked her if the city can recoup the expense of cleaning up these properties, which also included a larger site of the defunct Days Inn at 200 Oak St.

“We bill them at 30 days, we bill them at 60 days, and we bill them at 90 days. And we will bill them again until it's time to put it onto the tax bill. At that time, Heidi's office, the city clerk, will go ahead and levy that amount onto the tax bill,” Tabelski said. “And a lot of times, it'll get paid in conjunction with the late tax bill. So we need to increase the expense line this year by about $30,000. And we are done, with snow on the ground, for grass, weeds and debris. So I don't feel like this will go any higher than where it is this year.”

An email was sent out from Savarino Companies to those 55 tenants selected this past May for one of the Ellicott Station homes that had been in progress until a month or so ago. 

And, no, it was no longer congratulatory in nature about the tenants’ good luck in being chosen for one of the safe, quality, affordable rentals on the city’s Southside.

It was one of regret.

“You are receiving this email because you were chosen to be considered for an apartment in Ellicott Station Residential Apartments,” it began. 

“We are writing to inform you of the status of Ellicott Station Residential Apartments. Regrettably, we must convey that, as of today, there is no clear answer for when the Ellicott Station Residential Apartments may be ready for occupancy,” it stated. “Due to this unforeseen circumstance, we highly recommend that you begin exploring alternative housing solutions. We understand the uncertainty and inconvenience this situation may cause. We apologize for any inconvenience to you. 

“We will continue to monitor the situation and provide updates as they become available,” the company said. “Thank you for your understanding and your cooperation.”

Up to now, there have been few if any answers as to the plight of those tenants and the fate of the four-story apartment complex that now sits idle at 50 Ellicott St. 

City Manager Rachael Tabelski has said that developers have expressed interest in the property, but the city doesn’t own the property and has no say in how it proceeds from here.

The Batavian reached out to her Friday about this latest development and with additional questions. She said that “this week there has been multiple conversations with Savarino Companies, investors and lenders about how best to move forward.”

There are two main options, she said, one is to find a general contractor to complete the work and a new property manager, or pause the project completely and reboot with a new developer/operator.    

For any observant spectators passing by the apartment site this past week, you may have seen some people there — city inspectors — who will be issuing notices to the owners, construction lenders, and investors “to provide better site security, remove any grass, weeds and debris, and winterize the building,” Tabelski said.

“The construction lenders and investors have been extremely responsive to our requests and I look forward to working with them through this process,” she said.

Tabelski was aware that the letter went out to tenants but had no further information or comment about it. One of the tenants who has been communicating with The Batavian will remain in her current apartment and is hopeful that one of those new apartments will be hers one day.

For those looking for an apartment with similar income qualifications of Ellicott Station, Genesee County has a website with subsidized housing.

Pathstones also has resources for housing assistance and education, Tabelski said. 

The Batavian asked Tabelski if obtaining a new developer would mean starting all over with selecting new tenants, but since it was not a local lottery under Batavia’s control, “I cannot say how this will work,” she said. She referred The Batavian to Savarino and the state Office of Community Renewal for those answers.

HCR has stated that promised tax credits are tied to the project’s completion and that it will continue to oversee the project to ensure it reaches that end, similar to Genesee County Economic Development Center’s financial incentives. 

A bulk of the money promised to Savarino has a contingency that the project and/or stipulations within the project must be met in order to receive funding. This includes the $500,000 state grant from the Downtown Revitalization Initiative fund, which is attached to completion of rehabilitation of the electric building on the Ellicott Street property. 

Tabelski said that “the building was not completed and there has been no grant funds issues from New York State to Savarino Companies for the project that I am aware of.” It’s a similar scenario for a $250,000 National Grid grant for work to be done on Ellicott Trail.

“There are multiple grants supporting the project and they are all reimbursable upon completion. There was some Ellicott Trail work completed, however, the enhancements of lighting and benches have not been installed yet. The majority of the brownfield work has been completed, and more than 50 to 75 percent of the residential building work is complete,” she said.  “The work to the electric building, that was to become a brewery, was not as far along, and significant rehabilitation and restoration need to be completed.”

There are “several interested developers” working with Sam Savarino, president of the now-defunct Savarino Companies, after he announced closing about a month ago, City Manager Rachael Tabelski says.

In response to a request for an update, Tabelski said Tuesday that Savarino and banking institutions have been involved in talks with those developers, though she did not have or divulge anything “official.” 

“As of last week, the construction leading bank confirmed there were no liens on the project, meaning (subcontractors) were paid up to that point,” she said.  

When asked about the role of the state Office of Homes and Community Renewal, the agency that granted Savarino $5.7 million of low-income housing tax credits for the project, Tabelski said that “HCR is actively working with any/all developers interested in the project and has promised flexibility in their approach with AMI’s, etc.”

The city had hoped to negotiate the current AMI — area median income level — that had been set at a low to very low versus a higher workforce level, and it appears that it will fall to the next developer to take on that task.

Areas of concern for any construction project would include preserving the structural integrity so that nothing deteriorates or is damaged during the pause in work, and Tabelski said that “the City would like to see the investment winterized first and foremost and remain secured while the project is unwound.”

Savarino Companies celebrated a groundbreaking last year, and chose tenants for the 50 Ellicott St. site in May. It was to open up 55 homes between December of this year and February 2024.

Later this year, Savarino announced financial difficulties stemming from a deal gone wrong at Alfred State College, and shut down operations of his Savarino Companies, with the stipulation that Savarino Management would remain open. He did not contact city officials about the announcement or provide details about what that would mean for Ellicott Station, Tabelski said. Since then, the construction trailer was seen getting hauled off the property. 

Since the project is not merely a privately funded one, and involves county and state funding, the process will likely start over with a new developer, which will also likely delay the entire timeline. It’s not up to the city as to who and how it proceeds from here.

“We do not have a say as to who the developer will be to take on the project; it’s a private transaction,” Tabelski said. “This is a complex project and complex situation, and whoever takes on the project will need to be a seasoned and skilled developer who can make the project and finances work. The City remains encouraged by the interest.”

Suffice it to say that the name Savarino will be the word of the day for some time to come, as working through the recent company’s closure and what that means for Ellicott Station will be “a long process,” City Manager Rachael Tabelski said Thursday.

The Batavian had reached out to Tabelski late Tuesday about any updates on the closure of Savarino Companies and how that may impact the work-in-progress at the Southside apartment complex known as Ellicott Station. 

Tabelski responded on Thursday to say that company President Sam Savarino has not been in touch with the city since the publication of the news and that city officials are continuing to work on the situation. 

“There’s been no contact from the company,” Tabelski said. “We’re trying to gather as much information as we can. We don’t have answers yet, and we’ll be working on it. And looking to get those answers for everybody in the community, what next steps might be and what that might look like.”

She confirmed that prospective developers have contacted the city expressing interest in the project and that no vendors or subcontractors have called with concerns or complaints at this point.

City officials plan to meet with staff from the New York State Office of Homes and Community Renewal in September, which has been in the works since the city learned about lower-than-expected income requirements at Ellicott Station.

First promised as market rate, then workforce housing, the apartment complex's application surprised city officials earlier this year with low to very low-income levels, prompting them to reach out to HCR for assistance to see what could be done to raise those income levels to allow for workforce housing tenants. 

Apparently, in addition to the apartment complex, on-site work has also included preparation for a brewery, which had been discussed in original plans but had fallen through with the one company, Buffalo-based Resurgence Brewing. Savarino had later said that he still intended to follow through with the plan for a restaurant and/or brewery, whether it be another vendor or his own company. 

The developer owns the property at 30-50 Ellicott St. as part of a deal brokered by Batavia Development Corp. in an effort to throw a spark onto an underutilized piece of “brownfield” property that needed a remediation and economic boost.

New York State’s Office of Homes and Community Renewal promised $1.2 million per year for 10 years in low-income housing tax credits -- incentives that were tied to the developer securing an investor or investors to back the project.

He requested approximately $3.6 million in economic incentives, with a $2,105,792 property tax exemption, a $790,512 sales tax exemption, and a $180,792 mortgage tax exemption. The bulk of the incentives are only realized by the developer after the compilation of a project.

Genesee County Economic Development Center CEO Steve Hyde said Wednesday that the agency is working to determine the next steps to be taken and that the agency had already found the company to be in default of its financial agreement. 

Savarino was awarded $425,000 of the city’s Downtown Revitalization Initiative grant money and $5.7 million of HCR’s low-income housing tax credits.

In 2017 and 2018, the city also awarded his company two grants: one from Empire State Development called the Restore New York grant for $500,000 to rehab the old electric building that’s on the site and a $250,000 National Grid grant to enhance the Ellicott Trail on the property area right behind the Savarino campus. 

Savarino stated at the start of the project that the estimated construction costs at the time were more than $22.5 million.  The total of awarded grants, incentives, and tax credits is about $11.6 million. With the project incomplete, Savarino has not yet realized the full value of those incentives, grants, and tax credits.

The Batavian has reached out to Savarino for further details about the closure and future of Ellicott Station and its 55 previously confirmed tenants; and to HCR for comments about the agency's ongoing role and responsibility in this situation and will provide an update when/if a response is provided.

Previously:

• Apartment application reveals for first time, Section 8 vouchers accepted at Ellicott Station
• City leaders surprised by Ellicott Station's income levels, ask developer to raise them
• Ellicott Station developer, GCEDC excited about project for tenants to 'live, work and play'
• Ellicott Station is going up, city leaders ask for income levels to do likewise
• Lottery drawing selects 55 tenants for Ellicott Station, Savarino says
• One woman's dream comes true as first one chosen for Ellicott Station
• Savarino Companies going out of business, leave Ellicott Station up in the air
• Documents say Savarino defaulted on financial agreements, GCEDC and city work on 'next steps'
• Savarino explains reason for business closure

Sam Savarino cited a loss of more than $3.3 million that stemmed from a construction job at SUNY Alfred State College as reason for closing his Savarino Companies, and therefore leaving Batavia's Ellicott Station apartment complex in the lurch this week. 

Savarino sent The Batavian a four-page outline detailing what had transpired during that job, and we wanted to publish that explanation, albeit lengthy over the course of three years, here.

It began with DASNY
Savarino had a contract with the Dormitory Authority of the State of New York, known as DASNY, to perform the construction of a student housing project at Alfred. The project was called MacKenzie Hall Phase III renovation and associated asbestos abatement. It was broken down into three phases, and phase 3A was to be done before 3B and 3C were to begin, Savarino said, though there was some overlap between all three phases.

The pandemic plays a role
Soon after Savarino began the work in March 2020, it was suspended by DASNY due to COVID-19 and state executive orders. Savarino reserved its rights based on the project shutdown, and DASNY eventually determined that the work would resume on May 18, 2020, and the schedule would be reset. Phase 3A was then to be completed by July 23, 2021.

Phases 3B and 3C were to begin on May 17, 2021, and Savarino objected to the schedule that was being imposed and reserved all of its rights, he said. He moved toward completion of Phase 3A and also began certain work on the other two phases.

Alfred's change of plans
On April 30, 2021, more than two and a half months prior to the required substantial completion of Phase 3A work, DASNY informed Savarino that Phase 3B and 3C were being put on pause, Savarino said. Alfred College had determined that it needed to continue the use of dormitory rooms that would have been renovated as part of Phase 3B and 3C. No other reason was given at that time, Savarino said.

For a variety of reasons, including COVID-19, supply chain issues, shortage of labor issues, owner delay issues (e.g., late change order work and failure to require design professionals to timely respond to Savarino requests for information and assistance) and other issues that were not attributable to Savarino, the Phase 3A work was not substantially completed by DASNY’s imposed date of July 23, 2021, Savarino said. 

He was issued a temporary approval of occupancy by DASNY on or about Nov. 3, 2021, with respect to Phase 3A. Completion of “punch-list” items was still remaining.

Terminating services
Notwithstanding its approval of occupancy, DASNY provided notice to Savarino on Nov. 4, 2021, that it intended to terminate Savarino with respect to the Phase 3A work and the remainder of the project, being the Phase 3B and 3C work that DASNY had paused back on April 30, 2021. 

Savarino contested its termination in writing on Nov. 16, 2021, as well as during a conference call that was afforded to Savarino on that day, he said. By letter dated Nov. 19, 2021, DASNY terminated Savarino, purportedly for cause. Savarino has objected to its termination and has claimed that DASNY has breached the contract. Savarino has reserved all rights.

Good faith punch list
Notwithstanding the Nov. 19, 2021 termination, Savarino and its subcontractors continued to perform in good faith the “punch-list” items on the Project until DASNY terminated Savarino’s right to do that on or about Dec. 7, 2021. This punch-list work could have been completed within a short period of time, But DASNY required that it have in place a take-over agreement with Savarino’s surety, Endurance Assurance Corp., before any work could continue. This would prove to delay completion of the work, he said.

On DASNY’s demand, Endurance agreed to complete the work on the Project. Endurance requested that the surety be permitted to hire Savarino as its contractor to complete the work. This was a permitted alternative under the performance bond, but that alternative required the owner’s consent. DASNY flatly refused, Savarino said.

Completion/Takeover Agreement
Eventually, Endurance and DASNY entered into a Completion/Takeover Agreement that was executed on April 5, 2022. This allowed the completion of the Phase 3A “punch-list” work and set new dates for completion of the Phase 3B and 3C work. The surety hired Loewke–Brill Consulting Group as its representative and replacement contractor, all at great cost to Savarino, he said. 

While the agreement provided Savarino with the ability to assist Loewke–Brill, he was essentially barred from the site. Savarino assisted in scheduling, continuing subcontracts with subcontractors, payment applications and other matters to progress the work. DASNY’s own actions delayed the completion of the Project, he said. 

The “pause” on the Phase 3B and 3C work on April 30, 2021, for the convenience of Alfred State College, cannot be attributable to Savarino, he said, and its refusal to allow work on the Project to proceed until the Completion/Takeover Agreement was signed on April 5, 2022, further delayed the Project.

Building his case
Savarino denies that it was appropriate for DASNY to terminate his work on the Project. Savarino said he believes that the termination resulted from deteriorating relationship between Alfred State College and DASNY and DASNY’s attempt to “save face” by blaming Savarino for delays in the completion of the Project. 

Savarino further believes, according to his email, that, in any event, other causes contributed to the delay in completion of the Project. Savarino has engaged an expert to study the delays that he incurred that were outside of his control, and preliminary indications from that expert indicate that an extension of time in favor of Savarino for the Phase 3A work beyond DASNY’s imposed date of July 23, 2021, would be appropriate.

Moreover, the contract with DASNY provides for liquidated damages for a delay in project completion. If these are appropriate in amount and not unenforceable as a penalty, that would provide DASNY its remedy for delay in completion. 

Savarino believes that, in any event, Alfred State College was not materially impacted by the delay in completion of Phase 3A. The students that would have occupied Phase 3A were housed in other facilities on campus, he said.

Filing his lawsuit
On Nov. 15, 2022, Savarino filed a lawsuit against DASNY in the Supreme Court of the State of New York, with the venue in the County of Albany, to seek an adjudication of the respective claims of the parties. That lawsuit is now in the discovery stage.

It should be noted, he said, that Phase 3B of the Project achieved a temporary approval for occupancy as of Aug. 11, 2023, and is now being occupied. It is anticipated that Phase 3C will be completed by the anticipated date of Nov. 24, 2023, as set forth in the Completion/Takeover Agreement with Endurance.

Savarino claims that it has been severely impacted by DASNY’s actions on this Project. Savarino will be seeking damages from DASNY in the currently pending action, he said.

Savarino included an attachment that tallied estimated damages of $3,310,282.82 based on the increased costs and legal fees that Savarino incurred that were caused by DASNY’s actions.

The next steps are yet to be determined.

That seems to be the ongoing response from city and county officials in the aftermath of an announcement by CEO Samuel Savarino that his company will be ceasing operations and laying off its employees.

Savarino is the developer of Ellicott Station, the four-story apartment complex touted as an economic lifesaver for downtown Batavia and for working individuals and families in need of an affordable, quality and safe place to live.

That economic vision was blurred earlier this year when the online rental application indicated income requirements of very low to low ranges, seemingly squelching the notion that the units would indeed be for workforce individuals. The Batavian had reached out to Savarino requesting details about a lottery that awarded rentals to 55 tenants. He wasn’t privy to such information, he had said at the time.

Apparently, the Genesee County Economic Development Center had more luck. The agency had, according to its June 29 meeting minutes, “requested “blind” demographic information to ascertain 1) where the lottery winners are from and 2) what percentage of the lottery winners are gainfully employed.

“Despite numerous efforts, there has only been partial information received back from the developer.  On July 13th, a demand letter was issued to provide the information requested to assess if the project meets the requirements of Workforce Housing,” the minutes state.

Savarino finally responded on July 31. After careful analysis, GCEDC determined that the developer remained “in default for performance reasons.”

“There is an insufficient number of lottery winners that meet the GCEDC definition of workforce housing, which is aligned with the industry definition as well,” the minutes state.

When reached for comment about the company closure Wednesday, Steve Hyde, CEO of the agency, said that “next steps are yet to be determined.

“To clarify, the majority of the GCEDC financial agreements for the project are termed over 30 years that start following the completion of the project. These are structured as performance-based. Additionally, the project was notified in July that it is in default of its GCEDC financial agreements and is currently in a cure period to meet the goals of a workforce housing project,” he said. “In light of the news yesterday, the project being in default to our financial agreements enables the GCEDC to have a greater role in ensuring a positive solution as we work with all parties involved. We continue to work with the City of Batavia towards this goal."

Savarino issued an emailed statement Tuesday, and added that there would be no further comment at this time. The Batavian reached out to one confirmed future tenant of Ellicott Station, who did talk to a Savarino employee. Carla Laird was featured in The Batavian after the lottery happened this past spring, and her excitement hasn’t diminished about moving into Ellicott Station, though she is concerned.

Laird was told to continue planning for her new apartment, with a move-in sometime between December and February. The Batavian emailed Rachel Good of Savarino Companies to confirm this and has not received a response.

On Tuesday, City Manager Rachael Tabelski said that the city had not been contacted by Savarino Companies before the announcement and is, therefore, "reviewing and evaluating all information as it comes forward."

"Over the past month, the City has worked with the Genesee County Economic Development Center (GCEDC) to demand Savarino Companies provide workforce housing at Ellicott Station as promised in their applications to the State and City.  The City will be meeting with regional and state partners to seek assistance to move the Ellicott Station Project forward," Tabelski said Tuesday. "As more details become available, we will update the community.”

Back in February, city and county officials responded to the news that Ellicott Station was not going to be as workforce-friendly in diverging ways. City Council sent a letter to the state Home and Community Renewal agency seeking assistance to ensure that income levels could be increased to offer a better mix of rental opportunities.

Hyde focused on the longstanding and dilapidated defunct buildings at 30-50 Ellicott St., and how Ellicott Station was designed initially “and continues to contribute to helping achieve the goals of the Batavia Brownfield Opportunity Area (BOA) and the Downtown Revitalization Initiative (DRI),” he had said in February.

He pulled an excerpt from the DRI application for the Build Ellicott Station Project:

“The DRI program will be a comprehensive approach to boost Batavia’s economy by transforming the downtown into a vibrant neighborhood where the next generation will want to live, work and raise a family.  A key component of the DRI program is to advance strategic private and public investments that will provide catalytic impacts to facilitate downtown revitalization.”

“I believe the Ellicott Station Project, in its current form, continues on this path by making public/private investments, revitalizing a blighted parcel which is helping to transform our downtown into a vibrant neighborhood that offers opportunities for our young adults in the community to live, work, play and raise a family in a significantly upgraded area of downtown Batavia,” Hyde said. 

Savarino had said he wasn’t sure why city officials were upset, as income qualifications hadn’t changed according to his understanding. 

He said that those numbers were fixed in 2019 per 50 to 60 percent of the area median income at the time. The project will have to be up and operating before it can be adjusted, he had said at the time, but that is a possibility. 

“So if wages have gone up in that time, then the income restrictions will go up, and if they’re going down, the income restrictions will go down,” he said.

Previously:

• Apartment application reveals for first time, Section 8 vouchers accepted at Ellicott Station
• City leaders surprised by Ellicott Station's income levels, ask developer to raise them
• Ellicott Station developer, GCEDC excited about project for tenants to 'live, work and play'
• Ellicott Station is going up, city leaders ask for income levels to do likewise
• Lottery drawing selects 55 tenants for Ellicott Station, Savarino says
• One woman's dream comes true as first one chosen for Ellicott Station
• Savarino Companies going out of business, leave Ellicott Station up in the air

As Ellicott Station, the four-story apartment complex in Batavia’s downtown Southside, remains unfinished and behind schedule of what was previously announced for a summer opening, Samuel Savarino of Savarino Companies confirmed Tuesday that the 23-year-old company “will be winding down and ceasing operations,” according to The Buffalo News. 

Savarino said that the company would be laying off 30 employees after being unable to overcome significant financial losses following its dismissal from a state-funded SUNY construction project, the article states.

The Batavian called City Manager Rachael Tabelski and Samuel Savarino for comment and received an emailed response from Savarino confirming that the company will be "winding down and ceasing operations," however, it offered a thin promise for Ellicott Station's future completion.

UPDATED 4:12 p.m.: "The primary factors governing the firm’s decision are ongoing and increasing costs related to a project the company’s surety was forced to complete at Alfred State College, a recent termination of work and the company’s inability to obtain surety bonding or acceptance of alternative performance guarantees for $110 million of 2023 work which the company would otherwise have had underway at this time. Without that work, it would not be possible for the company to operate profitably," the email stated. "Savarino Properties, LLC, which is an independent company and provides property management services throughout Western New York, will not be impacted.

"Savarino Companies, LLC is actively working to achieve the best outcomes for its employees, clients and vendors. The firm is working with its clients, and in some cases, its surety to complete work on active projects and, where needed, is making arrangements with replacement contractors for upcoming work the company was slated to perform," the company stated. "The status of several initiatives and development projects that Savarino Companies was affiliated with has yet to be determined."

City Manager Rachael Tabelski said that the city had not been contacted by Savarino Companies before the announcement and is, therefore "reviewing and evaluating all information as it comes forward."

"Over the past month, the City has worked with the Genesee County Economic Development Center (GCEDC) to demand Savarino Companies provide workforce housing at Ellicott Station as promised in their applications to the State and City.  The City will be meeting with regional and state partners to seek assistance to move the Ellicott Station Project forward," Tabelski said Tuesday. "As more details become available, we will update the community.”

Savarino also emailed reports of the many charitable organizations that the company has supported over the years of its existence.

Photos by Howard Owens.

Tuesday’s lottery drawing was the next step in the process of filling Ellicott Station with tenants, the new housing complex in downtown Batavia.

The drawing happened in Savarino Companies’ Buffalo office, and The Batavian followed up with company President/CEO Sam Savarino for details about how it went.

More specifically, we asked how many people were chosen, and how many were singles and families, the income levels and if they were all employed, as Savarino had expressed they would be during a prior interview.

He was not sure what information would be “proper to divulge” about the 55 tenants chosen by lottery and on a waitlist, Savarino said Friday.

“So I have to politely decline your request at this time. It was announced at the event that there would be follow-up for qualifying/vetting pursuant to guidelines,” he said. “It was evident that nearly all 55 identified currently reside in Batavia or (in the) immediate environment.”

The lottery was part of an application and selection process for the new one- and two-bedroom housing complex on Ellicott Street. 

According to the application guidelines, income qualifications meet very low levels that, in some cases, are too high for minimum wage earners, making it seem likely that at least some applicants will fall within Section 8 parameters.

City of Batavia management and City Council members sent a letter to Housing and Community Renewal for reconsideration of current income levels set for Ellicott Station, so that higher salary earners (per the median area income) could be eligible to apply for apartments.

Both sides have talked, Council President Eugene Jankowski Jr. said, but no other details have been disclosed. City Manager Rachael Tabelski has not responded to requests for updates related to the issue.

File Photo of Ellicott Station in an earlier phase of construction, by Howard Owens.

All eight City Council members signed a letter Monday night requesting that state Homes and Community Renewal officials work with the city to bump up a portion of the current Area Median Income levels at Ellicott Station.

“The city of Batavia is requesting that HCR work with us to present a better mix of incomes on the property with apartments that rent for 80 percent and 120 percent AMI,” the letter states. “We feel that this will encapsulate the workforce housing that we were promised, better align with the city’s vision of the DRI strategy, and still provide affordable housing for residents.”

Earlier Monday, during council’s business meeting, City Manager Rachael Tabelski referred to a letter that she had provided for council members to review. Apparently, they reviewed and revised the letter after the meeting. The Batavian has asked for additional details about that process and will update this article once responses are received.

Since the first application went in for Ellicott Station, local folks were excited about the prospects of longtime vacant and toxic property along the south side street getting cleaned up, renovated and repurposed. But since its inception in 2016, as City Manager Rachael Tabelski has described it, the project became fairly fluid.

“Ellicott Station has been a moving target over the last several years as the developer made various and multiple overtures to funding entities with regards to making the project financially viable. In 2019, the City supported the project’s housing component as being mixed-income that would provide housing for residents that were employed in local manufacturing in an application submitted to New York State Homes and Community Renewal from the developer,” Tabelski had said. “Furthermore, in 2020, it was confirmed that people living at Ellicott Station must be employed and not receiving government assistance."

City leaders had expressed disappointment about the apartment project’s income levels after The Batavian’s exclusive coverage published on Feb. 18. Application materials made available at Ellicott Station’s website outlined the qualifications for one- and two-bedroom units, many of which had maximum annual salaries at or below minimum wage and seemingly requiring Section 8 assistance.

One example is that two people each earning minimum wage, $14.20 an hour, are not eligible for a two-bedroom apartment at Ellicott Station because they would be earning too much (the maximum household income for two people in a two-bedroom apartment is $34,600, and two people working full-time at $14.20 would gross $59,072).

Developer Sam Savarino has said, in a follow-up interview with The Batavian, that he expects the housing complex to be filled with gainfully employed people, though he had no thorough rationale for the low maximum income levels. He said that the numbers were set a couple of years ago and can be reset once everything is up and operational at Ellicott Station if current salaries have increased.

Here in Batavia, “we would like to be known for innovative housing that has a mix of incomes to preserve our most vulnerable neighborhoods, help citizens, and provide for housing for entry-level manufacturing, service workers, and students,” the city’s letter states. “The City of Batavia, New York State, Brownfield Opportunity Area, and the Downtown Revitalization Initiative (DRI) strategy both define the need for downtown housing, including infill construction, upper floor apartments, and a demand for higher income housing, including market-rate housing.”

“When Ellicott Station Project was proposed by Savarino Companies, it was originally a market-rate housing project, however, through several financing iterations, Savarino Companies worked with HCR to finance the project. The city discovered that at the time of application, Savarino Companies applied to HCR for a mixed-income housing model but was directed by local HCR representatives to only allow residents with 50 percent to 60 percent AMI,” the letter states. “While workforce housing is the goal for the Ellicott StationSavarino Development, that is not the type of tenants that this housing will attract.”

The letter further lays out the compounding issues of the capped 50 to 60 percent Area Median Income and  inflationary wage increases that will not allow working citizens to qualify to live at Ellicott Station, and “only vouchered Section 8 residents will now be able to access this property.”

“This is a fundamental change from the goals for the Ellicott Station project and does not match the BOA or DRI strategies for development of our downtown,” it states.

As a result of this fundamental change, city leaders said they are concerned that:

• Drastically increased wages for entry-level manufacturing and service jobs pay more than what would qualify for this housing complex;
• The project no longer aligns with the City’s DRI and BOA strategies, and it won’t fulfill the City’s need for market rate and workforce housing as determined from various studies;
• Low and very low-income housing — versus mixed-income housing — could set the project up for potential issues contrary to community objectives, including drug, gang, and criminal activity, per proven studies;
• Other DRI communities across the state have received HCR tax credits and rents were allowed to be 80 to 120 percent AMI in some cases — so why not here?

Photo of Ellicott Station in progress at 50 Ellicott St., Batavia, by Howard Owens. 

While city officials have expressed surprise and disappointment about the details of Ellicott Station, developer Samuel Savarino and Steve Hyde, CEO of the county’s Economic Development Center, remain enthusiastic about the possibilities to come along with the 55-unit, low-income apartment complex in Batavia.

During an interview with The Batavian, Savarino was steadfast about tenants being employed and able to pay their rents at the 50 Ellicott St. site.

“Our project is one- and two-bedroom, which I think could be said fits the profile of young workers or working couples,” he said.

The Batavian asked about the maximum income qualifications, per the Ellicott Station application, which in some cases means people making minimum wage wouldn’t qualify for a two-person apartment. Savarino said that those numbers were fixed in 2019, per 50 to 60 percent of the area median income at the time. And they’re not set in stone.

“When things change every year, the income restrictions are reset, just as there are changes in the area median income and what people earn. So, you know, that changes over time. But, I think it really does set at some are 50 and the majority are 60 percent of AMI, right? And that's back in 2019 numbers,” he said. “And the project has to be up and operating before it gets reset. So if wages have gone up in that time, then the income restrictions will go up, and if they’re going down, the income restrictions will go down.”

He isn’t sure why city officials are upset about the low-income qualifications and Section 8 availability, he said, since the project has been geared toward what’s affordable for the Batavia area per a market study from the project's inception. It is true, he said, that Home and Community Renewal’s involvement — which happened when the state entity granted him more than $5 million in tax credits to get the project going — also meant a market study review and conclusion about what would be considered affordable.

“I think we had a market study which looked at … I mean, everybody can maybe look around things and draw their own conclusions. And, you know, a market study is a little more detailed … it's a little more refined, and more scientific with determining what the achievable rents would be and whether there would be people to rent at certain levels. Any market study will do that,” he said. “And if you looked at the application that went in to the unified funding application to Home and Community Renewal, which provides the tax credits, which an investor purchases, and then they provide some financing for the projects, that it was workforce housing, affordable workforce housing.

“And that's consistent with what everybody was saying. It can be reset, but that's what we need to follow … at the suggestion of HCR after they examined the market study. My recollection was that they said, that's where the market was. And that was where the need was.

“I’m not quite sure if there's an Oxford dictionary definition of what is affordable as opposed to workforce, as opposed to low income. You know, it depends. And it may mean different things in different communities,” he said. 

Those terms are used interchangeably, he said. Above all, he envisions working singles and couples, or perhaps seniors on a fixed income, living at Ellicott Station. Given the low-income levels, what’s the chance that many would also require government assistance to make the rent if they qualified for those income levels? Savarino wasn’t familiar with how Section 8 works, he said, but it does work the same as with any other rental. It's illegal to discriminate against a tenant with Section 8 requirements, he said.

His management will be screening applicants to ensure they have a job and can pay rent, he said. Furthermore, he believes they will be “good tenants” living in a good, quality residence with plenty of security cameras, and secured access to the building. The Batavian asked him why the playground was built and promoted if he didn’t think the apartments had the space for children — which he had said during the interview — and it is a mandated requirement, he said.

As for the meanings of workforce, affordable and low income, The Batavian had previously published an article citing the definitions, per the Housing and Urban Development site. Though, in talking to various people regarding this project, those words did seem a bit murkier. Savarino disputed a statement in a prior Batavian article that he had quoted specific, ideal wages of $18 to $20, and also $20 and below. He didn’t recall having said that, though it was captured on a recorder. None of the maximum incomes allow for those wages or even $14 in some cases.

The calculations worked out to take 30 percent of one’s salary for rent and utilities, he said, and leave the remaining 70 percent for other expenses. That means tenants could potentially have disposable income to dine at downtown restaurants or do some shopping, which was one of the original goals of the project, he said.     

The other goals were to include commercial and retail projects at the site, and, due to the lengthy time it took to get going, Resurgence Brewing “timed out” and completed a project in its own neighborhood, Savarino said. He has some interested prospects and is committed to following through with a brewery/restaurant with either an outside company or Savarino Companies itself.

Steve Hyde, president and CEO of Genesee County's Economic Development Center, focused on another aspect of the project — the longstanding and dilapidated defunct buildings at 30-50 Ellicott St. Ellicott Station was designed initially “and continues to contribute to helping achieve the goals of the Batavia Brownfield Opportunity Area (BOA) and the Downtown Revitalization Initiative (DRI),” he said.

He pulled an excerpt from the DRI application for the Build Ellicott Station Project:

“The DRI program will be a comprehensive approach to boost Batavia’s economy by transforming the downtown into a vibrant neighborhood where the next generation will want to live, work and raise a family.  A key component of the DRI program is to advance strategic private and public investments that will provide catalytic impacts to facilitate downtown revitalization.”

“I believe the Ellicott Station Project, in its current form, continues on this path by making public/private investments, revitalizing a blighted parcel which is helping to transform our downtown into a vibrant neighborhood that offers opportunities for our young adults in the community to live, work, play and raise a family in a significantly upgraded area of downtown Batavia,” Hyde said. “We continue to work closely with Developer Sam Savarino and his team to deliver upon his commitment to construct new, modern, and affordable workforce housing for working residents who have modest incomes across our community.  This is a critical element to downtown revitalization efforts because not only does Ellicott Station renovate a blighted parcel in our downtown but it is building workforce housing units for working residents in the heart of our downtown many of whom would have the opportunity to work at our area businesses which are sorely needed.”

Hyde and Savarino also pointed to the benefit of having nearby housing for employees that businesses are seeking. Without local residents, it has been difficult at times for employers to fill vacancies, Savarino said. It also equips downtown with tenants within walking distance, Hyde said.

“This further strengthens the opportunity for greater success for our Main Street businesses and our local economy.  I confirmed with Developer Sam Savarino last week that his commitment to deliver workforce housing for working residents is priority #1.  The incentives provided by GCEDC to support the comprehensive re-development of this mixed use project did comprehend the 60 percent or less AMI and associated range of incomes contemplated for the workforce housing facility as reflected in our public hearing minutes, the board memoranda and final resolution from our March 2020 Board meeting,” he said. “The net of this is: The GCEDC Board of Directors trusted in Sam Savarino to deliver workforce housing for working residents in an effort to incentivize considerable investment and improvements to transform the biggest eyesore in our downtown into a new mixed-use development.  They continue steadfast in their expectation of Mr. Savarino to honor his commitment to provide high-quality workforce housing for working residents across our community.

He and Savarino look forward to the project’s completion, and neither seems to believe that the income qualifications are too low to bring prosperity to the city of Batavia, per questions asked by The Batavian and the focused answers.

“I personally continue to look forward to the positive benefits provided by the Ellicott Station project which includes offering new apartments to our working residents priced in an affordable fashion that would allow them to live, work and play downtown,” Hyde said. “This will, in my view, help to elevate the staffing availability and success of our area businesses – our Main Street businesses in particular.  That is the promise we continue to expect and the main premise why GCEDC has participated actively in this project over the course of the last eight years.”

Photo: File photo of Sam Savarino at the Ellicott Station groundbreaking by Howard Owens

Since the first application went in for Ellicott Station, local folks were excited about the prospects of longtime vacant and toxic property along the south side street getting cleaned up, renovated and repurposed.

Funding snags delayed the process from 2016 until it finally —literally — began to get off the ground in 2022. A 55-unit “workforce” apartment complex, alongside mixed-use properties of office, restaurant and brewery space, began to take shape at the site of the former electric and Soccio Della Penna buildings at 30-50 Ellicott St., Batavia.

As the apartments are coming to fruition, a bomb was dropped Friday with an online posting of the application, income requirements and related rents for one- and two-bedroom apartments for up to four people. What once was touted as workforce or affordable rentals were now low-income and Section 8.

City Council President Eugene Jankowski Jr. refrained from saying much about the issue before he obtained more information. But he wasn’t pleased by the news.

“I’m very disappointed,” he said.

“I’m disappointed that all the things that were promised didn’t come to fruition,” he said. “The DRI money would have been worth spending if it was built as promised.”

To clarify about that DRI (Downtown Revitalization Initiative) grant money. New York State doled out the grant money for several initiatives, including $425,000 to Sam Savarino of Savarino Companies, the contractor for Ellicott Station. The state granted a total of $10 million of DRI monies within the city of Batavia, but only a portion of that directly to the city, and the remainder of it directly to specific projects, including Ellicott Station.

During the groundbreaking ceremony last year, Savarino talked about the project at 50 Ellicott St. being for workforce people earning in the range of $18 to $20 an hour, and looking for quality housing at an affordable price.

Part of the Ellicott Station project is to include a restaurant and brewery, which Bialkowski doubts will ever get off the ground.  There haven’t been any takers yet, and Savarino has been advertising the opportunity on the Ellicott Station website.

One upside the Councilman-at-large does see with this new complex is that the old Della Penna site has been renovated and will be back on the tax rolls, he said.

They were the only council members to respond to requests for comment.

The project was “billed as mixed-income” and not strictly a low-income complex, City Manager Rachael Tabelski said.

Tabelski referred to a letter sent to HCR in 2019 by former City Manager Martin Moore, in which he confirms the city’s intent for what type of housing they expected Ellicott Station to provide.

It states, in part:

I am writing to express support for the Ellicott Station housing project in Batavia, which provides mixed-income/affordable living quarters, and cleans up a blighted site in the heart of the City. The Ellicott Station project phases include construction for 55 mixed-income/affordable housing units, and construction of commercial buildings. The housing project phase provides high quality, well maintained residential units within walking distance of employers, shopping, medical facilities, public transportation, and other amenities. We look forward to the brownfield remediation, and dilapidated building demolition that will occur prior to new construction. 

The Ellicott Station portion of the DRI grant was awarded as a high priority project to address housing and economic development needs. City planning documents also recognize the site as a major component of brownfield cleanup, increased workforce housing availability, and commercial revitalization. 

We request that the Division of Housing and Community Renewal approve the funding for the Ellicott Station housing project. The project aligns with your mission to build and support affordable housing, and supports our goals to increase housing availability and promote economic growth in Batavia. 

Tabelski believes that additional talks have shifted the tenor of the project’s income qualifications, and is pursuing further communication about the issue.

“Unfortunately, the City has not been included in various discussions since then as it pertains to the housing component of the project and is surprised to learn only recently about the (annual median income) and lack of mixed-income housing,” she said. “The City is requesting that the developer work with HCR and economic development agencies to raise the AMI to reflect current manufacturing wages in a good faith effort to remain true to the intent of the project that was originally proposed and subsequently supported by the City.”

She is not certain where exactly the city will go from here, but "we owe it to ourselves and our citizens" to try something and not just let it go. 

Savarino has announced that applications are being taken, and a lottery will be conducted on May 2 in Buffalo to select tenants for the apartment complex. For more information, go to Ellicott Station. 

See also: OPINION: Ellicott Station is not looking like a 'Pathway to Prosperity

Housing projects have various classifications, such as workforce, affordable and low income, all of which have certain definitions and income levels, and The Batavian wanted to clarify which words and parameters fit the Ellicott Station project in downtown Batavia.

First, a little housing definitions lesson:

Affordable Housing is generally defined as housing on which the occupant is paying no more than 30 percent of gross income for housing costs, including utilities.

Market Rate Housing is the prevailing monthly cost for rental housing. It is set by the landlord without restrictions.

Housing Authority Housing authorities are public corporations with boards appointed by the local government. Their mission is to provide affordable housing to low- and moderate-income people. In addition to public housing, housing authorities also provide other types of subsidized housing.

Subsidized Housing is a generic term covering all federal, state or local government programs that reduce the cost of housing for low- and moderate-income residents. Housing can be subsidized in numerous ways—giving tenants a rent voucher, helping homebuyers with downpayment assistance, reducing the interest on a mortgage, providing deferred loans to help developers acquire and develop property, giving tax credits to encourage investment in low- and moderate-income housing, authorizing tax-exempt bond authority to finance the housing, providing ongoing assistance to reduce the operating costs of housing and others. Public housing, project-based Section 8, Section 8 vouchers, tax credits, the State Housing Trust Fund, and Seattle Housing Levy programs are all examples of subsidized housing. Subsidized housing can range from apartments for families to senior housing high-rises. Subsidized simply means that rents are reduced because of a particular government program. It has nothing to do with the quality, location or type of housing. In fact, a number of Seattle's subsidized housing developments have received local and national design awards.

Workforce Housing is the industry standard definition for affordable housing that serves families that are at or below 60 percent of the median income.

When talking to local economic and project development folks, semantics seemed to really matter. Workforce was not much different than affordable, according to one person, and the term low income was freely bandied about until The Batavian tried to confirm that the housing was subsidized, and the comment was retracted. And nobody wanted to be quoted out of uncertainty.

The assets manager for Savarino Companies has not yet replied to email inquiries after The Batavian was referred to her last week.

At last, an answer came from Jim Krencik of the county’s Economic Development Center. Krencik confirmed that the buck stopped with him, per the last known income qualifications that EDC was aware of for the Ellicott Station project.

To back up a bit, why was this a question to begin with? Because, several years ago, in the infant stage of this project, there was talk of market-rate apartments to provide up-scale prices and amenities to feed the appetites of higher-paid workers and help to grow the city’s economy with an influx of well-to-do consumers.

That bubble was burst last year when Sam Savarino, owner of Savarino Companies, announced that it was a workforce apartment project going up on Ellicott Street. It was going to be for entry-level workers making around $20 an hour or less.

But then rumblings and murmurs took to the streets, combined with questions and fear and lack of details, and the possibility of this being a mixed project of affordable and low income, or subsidized only, emerged. So The Batavian tried to get an answer from economic and project development folks — to no avail.

So now, onto the answer. Krencik didn’t really give a classification label, but just an answer. Of the total of 55 units, 25 of them will go to tenants with 50 percent of the county’s current available median income, and 30 units will go to those with 60 percent of the median income.

As an example of what that could be, the latest median yearly income data from 2017 to 2021 was $63,734, 50 percent of that is $31,867 and 60 percent is $38,240. Krencik emphasized that if someone was approved based on that starting salary and then was promoted and earned a raise, he or she wouldn’t lose the apartment because of that increased figure.

The idea is to provide quality housing to people who may have just graduated from college and are starting out with a new job and career, and want to live in a decent place that they can also afford, he said.

What about all of those parents stating that their kids can’t find jobs to keep them here? Do you really think there will be enough entry level people to fill this complex?
Krencik was glad to get the question. He could then volley back information about a new program called Cornell Food Processing Bootcamp, which is specifically for 2023 graduates. Students can earn a free food processing certificate from Cornell University at Genesee Valley BOCES and connect with local food manufacturers that are hiring with average starting wages of $20/hour, according to a GCEDC flyer.

After doing some hard-hitting promotion of the program, there are 26 students signed up so far, Krencik said, all of whom could be viable candidates for Ellicott Station. While the housing complex won’t be for everyone, it can fill many needs, he said.

“A lot of folks in that cohort are saying, hey, you know, I want to live where I have a supermarket, that's a 20-second walk away, and there's restaurants a 30-second walk away,” he said. “And there's musical performances, of all the concerts that happen in that area, that is attracted to that group. And right now, we've been really marketing that program hard for about three days now.

“And we're hoping to address, with a lot of activity that's been happening, if there wasn't enough quality apartments or single-family homes, and having projects that are taking those on to help people out at all phases of their life when they're starting off in a career or ready to, you know, have that big single family home for their growing family, or they're on the other side of that, and they're looking for the type of housing where they don't need a big house anymore, having all those available is really the key to having viability in our housing market,” he said. “So I guess a single project doesn't doesn't solve it for every one of those scenarios, but it's a piece of solving it with many others.”

Savarino Companies has been taking names of interested tenants for the complex, which is to open this summer. For more information, go to ellicottstation.com.

File Photo of Ellicott Station's progress in January 2023, by Howard Owens.

Even though the end of summer is now upon us, construction marches on for as long as the weather permits.

Batavia Development Corporation Director Tammy Hathaway recently reviewed a list of projects — from completed and in progress to still in the design phase — throughout downtown.

Hunt Real Estate’s new home at 97 Main St. is set for its debut with a ribbon-cutting ceremony on Tuesday while architectural and design firms are working out details for a revamped Batavia City Centre and Jackson Square.

Ellicott Station — the $22.5 million project of 55 units within an apartment complex, office suites and a restaurant/brewery is coming along, Hathaway said, sharing that she and City Manager Rachael Tabelski had taken a tour of the south side construction zone.

Standing just outside of the four-story, naked wood complex, one can hear power tools and occasionally see workers on the top floor. Peeking through the window and door cut-outs, one can see traffic along Ellicott Street and businesses on the opposite side of the street.

The project is moving along swiftly, Hathaway said during the BDC meeting at City Hall.

“It’s a gorgeous building,” she said of the defunct Della Penna site that’s part of the project.

Theater 56 will be going into the next phase of construction at its new location in Batavia City Centre, she said. BDC member Pierluigi Cipollone asked if the project was still on course for year-end completion. “As far as I know,” Tabelski said.

Other projects are underway from 99 to 216 Main Street, including a $5.25 million "Carr's Reborn" renovation, and focus has been placed on 60 Evans St., known as Creek Park LLC, Hathaway said. The LLC company is a subdivision of Batavia Development Corporation: "BDC will take ownership of  Creek Park LLC for land development," she said. "To make the unknowns known."

For example, Savarino Companies went through Creek Park LLC for its Ellicott Station project, she said. There is also a piece of property called Creek Park that sits behind the ice arena on Evans Street.

“We’re working on getting that into Brownfield development,” she said.

Brownfields are identified for potentially needing remediation to remove toxic materials from those sites. There has been some interest in the site, so far, Hathaway said, and it's unknown right now whether remediation will be required, so that will need to be explored.

“It’s been extremely exciting lately,” she said. “I have a major crush on this job.”

Three different blocks of projects have so far tallied estimated investments of $2.4 million, $66 million, and $1.14 million, she said, for all of the above sites, plus the Healthy Living campus, which is also under construction, and Ellicott Place, which has been completed on top of the Save-A-Lot building at Ellicott and Jackson streets.

A majority of the $69.4 million investment has been from private developers, with the Downtown Revitalization Initiative, and New York Main Street grants providing about $10.8 million toward the cost.

“I would say to pack your hard hat and work boots because so much is going on with tours,” she said to the BDC members.

Top Photo: Creek Park on Evans Street, Batavia, has been identified as potential development property; Ellicott Station developer Savarino Companies continues to progress toward a 55-unit apartment complex with 52 balconies, nine units dedicated to meet Americans with Disabilities Act requirements, 37 garage parking spots and 44 surface parking spaces, a laundry room, elevator, community room, bicycle storage and an enclosed ADA playground on Ellicott Street. Photos by Joanne Beck.

Sessler Environmental Services of Rochester will be at the Ellicott Station project site for the next few weeks to tear down the former Soccio & Della Penna and Santy's Tire Sales buildings on Ellicott Street in the City of Batavia.

“This building (Soccio & Della Penna, photos at top) knockdown should take about a week to knock it down and load it out," John Christman said today. "And the Santy’s Tires will be probably another two weeks from today.”

Christman is Sessler's project manager for the Santy's portion of the demolition.

He said the demo of the Santy’s building won't start for a couple weeks – not until the Soccio & Della Penna structure comes down. The garage on the property has been razed.

The photo at the bottom shows a building that will remain -- earmarked for renovation as part of the $22.5 million Downtown Revitalization Initiative mixed-use venture being developed by Savarino Companies of Buffalo.

Plans call for construction of a five-story apartment building with 55 new, modern workforce housing units, as well as a brewery, restaurant/beer garden and potential further development on 3.31 acres. It is expected to create 20 jobs in the city’s downtown area.

Photos by Mike Pettinella.

Batavia City Council members and city management tonight exhibited varying degrees of trust in the Buffalo development company charged with turning the eyesore on Ellicott Street into the multi-million dollar Downtown Revitalization Initiative project known as Ellicott Station.

Council, during its Conference and Special Business Meetings at the City Hall Council Board Room, had the task of considering two resolutions in connection with the mixed-use endeavor on property that once was the home of Soccio & Della Penna Inc. construction and Santy’s Tire Sales:

• Whether to take receipt of a $500,000 Restore New Grant that would support Savarino Companies in its demolition, rehabilitation and adaptive re-use of the former National Grid electric building;

• Whether to approve a resolution requiring the developer to enter into an “undertaking agreement” that would protect the city by transferring all or a portion of the obligations of the grant to Savarino Companies.

Although City Manager Rachael Tabelski emphasized that if Savarino doesn’t perform the work, it won’t get the grant, some Council members were skeptical to the point of believing that the project will never get off the ground.

Rose Mary Christian called the Brownfield Opportunity Area in its current blighted condition as “disgusting and deplorable.”

“I don’t have any faith in this company,” she said, while voting “no” to both measures.

Fellow Council member Robert Bialkowski said he had “great concerns” as he voted yes, while Council President Eugene Jankowski agreed, but feared that squashing the grant proposal could jeopardize the start of demolition.

“It’s my opinion that there’s a lot of small, complicated parts to this project of that magnitude,” he said following the meeting. “You have a large project that’s a brownfield, and on top of it you’re trying to put together all of the funding for it. It’s not an easy task.”

Jankowski admitted that he “got his hopes up” early on when the project was submitted, but understands that outside factors such as working with New York State, COVID and cost overruns likely contributed to the delay.

“At this point, we need to give them the opportunity to start construction in November like they said, and I am going to be optimistic that that’s exactly what’s going to happen.”

During the meeting, Tabelski said that Sam Savarino, company president, told her that the final closing with the New York State Office of Community Renewal, which has jurisdiction over the project, is scheduled for the first week of November.

The Batavian received that same information when talking to Savarino prior to environmental testing that was conducted on the property last week.

“I have no doubt that when they start, they will finish (the project),” she said, noting that Savarino Companies has paid the Batavia Development Corp. for the transaction of creating a Limited Liability Company and paid the city for permit fees and extension fees. “The developer does projects all over the state and he doesn’t want to lose the trust of the OCR.”

Unfortunately, after five and a half years since the announcement of the Ellicott Station residential/commercial/entertainment venture, the same can’t be said for some of those serving on City Council.

For the record, Council did vote 7-1 to pass both resolutions related to the grant.

Also, tonight, the board approved a resolution to accept a $7,500 STOP-DWI grant from Genesee County to combat impaired driving through the utilization of specified high-visibility engagement campaigns.

The introduction of new computer software means that it’s time to say good-bye to an old -- and outdated -- permitting and licensing fee schedule for the City of Batavia, according to a memo from City Manager Rachael Tabelski dated Oct. 25 and sent out ahead of Monday’s City Council Conference Meeting.

Council will convene at 7 p.m. for the Conference Meeting, which features a full slate of agenda items. A Special Business Meeting set up to vote on three of those items will follow.

In the memo, Tabelski promotes Energov software, a program that creates digital files for permits and licensing that will make life easier for Inspection Bureau staff. However, some of the current fees are not articulated clearly enough to jive with that software.

Additionally, she reports that a review of the city’s current processes and procedures – along with permit fees – was conducted.

Noting that the fee schedule hasn’t been updated in at least 15 years and has resulted in varying, inaccurate cost calculations, she is proposing a new fee schedule – a revised list of charges for certain projects that was approved by the Inspections Bureau, Plumbing Board and Bureau of Maintenance.

“In order to ensure that permit fees can be calculated in Energov and to create a permit fee schedule that is fair to all, a new fee schedule is proposed,” Tabelski wrote. “Many permits are proposed to be a flat fee. Permits that are not a flat fee have been structured for easy calculation by staff, the public and will easily compute in Energov.”

The memo indicates that work performed by the property owner will be calculated by square foot. If the project is not included on the list of flat fee permits – such as a porch rebuild or removal of a load-bearing wall – then the value of the cost of the project would be multiplied by 1.2 percent to determine the fee. Also, the fee will triple if work is done without a permit.

If approved by Council, changes would take effect on Jan. 1, 2022.

Tabelski put together a chart showing items up for revision and compared the proposed new cost to fees in Canandaigua, Lockport, Rome and Glens Falls.

Items on the list for revision, followed by the current fee, proposed fee (in bold), and fees in the four cities listed above in order:

• Re-roof all 1-family dwelling (2,200 sq ft - $13,000) -- $52, $65, $100, $59, $75, $50.
• Re-roof porch only (350 sq ft - $1,800) -- $40, $35, $100, $51, $75, $50.
• Re-roof commercial (1,200 sq ft - $26,000) -- $113, $312, $100, $150, $200, $150.
• Six-foot vinyl fence ($15,000) -- $65, $65, $50, $20, $75, $25.
• Six-foot wood fence ($7,000) -- $43, $65, $50, $20, $75, $25.
• Entire house vinyl siding (1,600 sq ft - $14,000) -- $53.50, $65, $480, $47, $75, $400.
• 1-family (375 sq ft - $22,000) -- $115.50, $264, $300, $150, $100, $200.
• Commercial addition (1,400 sq ft-$105,000) -- $550, $1,260, $500, $350, $200, $350.

Other Conference Meeting agenda items are as follows:

• Agreements with the Town of Batavia for city personnel to repair and maintain 31 street lights the town is putting up on Park Road in the area of Batavia Downs Gaming and a traffic control device the town is installing at the intersection of Route 98 and Federal Drive, north of the city.

In both cases, the city would invoice the town for labor and material costs.

Currently, city employees maintain the traffic light for the town at Veterans Memorial Drive and the Towne Center.

• Acceptance of a $500,000 Restore New York Grant that was awarded to the city in 2017 to assist Savarino Companies for demolition, rehabilitation and adaptive re-use of the existing former National Grid electric building in connection with the Ellicott Station project.

As a condition of disbursing the funds to Savarino, the Buffalo developer is required to enter into an “Undertaking Agreement” with the city to assume a portion or all of the obligations of the city under the grant.

• Mid-fiscal year transfers due to expenses incurred in excess of budgeted amounts set in April.

These include $30,000 from the contingency fund into the legal services budget for increased litigation costs, $12,000 from contingency into the information technology budget for an increase in the number of monitored computer servers, and $25,000 from the public works administrative salary account to the DPW engineering account for expenses owed to LaBella Associates in light of the city’s ongoing search for a DPW director.

Pre-construction work and environmental testing is taking place today on the grounds of the former Soccio & Della Penna Construction Co. and Santy's Tire Sales locations on Ellicott Street in the city -- the future home of the Ellicott Station project that is part of Batavia's $10 million Downtown Revitalization Initiative program.

Two employees of Savarino Companies of Buffalo, the company that is behind the mixed-use development (apartments, office, retail and entertainment space), were on site. Indications are that demolition of the buildings will start in November. Photos by Mike Pettinella.

The concept was born five years ago when Julie Pacatte, coordinator of the Batavia Development Corp. at the time, introduced Samuel Savarino, chief executive officer of Savarino Cos. of Buffalo, to an excited group of municipal leaders who gathered at the site of the former Santy’s Tire Sales and Soccio & Della Penna construction company on Ellicott Street.

Savarino proceeded to announce that his firm was selected to repurpose the 3-acre parcel in the City of Batavia’s Brownfield Opportunity Area into a development featuring office, retail, residential and entertainment space.

Fast forward to today and one would assume that not much has happened since that March 2016 press conference. To passersby, the location looks the same -- run-down buildings with broken and boarded up windows; an eyesore, to say the least.

Behind the scenes, though, much has taken place. And Savarino, in a telephone interview today with The Batavian, said that the proverbial “light at the end of the tunnel” is in clear view.

Closing Could Happen in May

“I expect there will be a date in May when there will be a closing,” Savarino said.

What that statement means is Savarino believes that New York State Homes and Community Renewal, which is allocating around $5 million in low-income housing tax credits to the project, may be at a point where lawyers can sit down, pull together all of the financial pieces and set the stage for demolition and construction.

“The closing with HCR (is the next step). The day after that we will be out there working; maybe a little bit before that, actually,” he said.

Savarino said the parameters of the venture have not changed.

The $22.5 million project calls for construction of a five-story apartment building with 55 new, modern workforce housing units, as well as a brewery, restaurant/beer garden and potential further development on 3.31 acres. It is expected to create 20 jobs in the city’s downtown area.

Resurgence Not Part of the Brew

He did report, however, that Resurgence, a Buffalo-based brewery, is no longer part of the plan.

“They sort of timed out,” he said. “We’ve got another plan in there for a brewery, and we’ll probably have a hand in operating it.”

Savarino acknowledged that he has heard the grumblings from city officials and others about the time that has elapsed since the initial announcement, but he said he let people know from the beginning that “we had our work cut out for us.”

“I said that it would take quite a while because we had, by our initial calculations, between a $5 million and $8 million gap in funding to make the thing work. There was a lot of work that had to be done to close that,” he said.

“We had one path we were going on with new market tax credits and after a year and a half or two years of heading down a path toward closing, and we were informed by the state that that wouldn’t work.”

Housing Tax Credit a Big Factor

He said his company was able to pursue a different strategy involving the acquisition of low-income housing tax credits.

“We identified the funds and brought them in, and closed the gap and have done what we said -- that we would work hard to do (this) from the beginning. I know that it has taken a lot of time to do it, but we’re on the cusp of beginning construction over there and overcoming the challenges that we had.”

In September of last year, HCR announced an award of $5.7 million in low-income housing tax credits for the project, but since then, that amount has been reduced, Savarino said.

“Part of the delay beside COVID and HCR is that the market had changed. One of the things we needed to have is an investor for the low-income housing tax credits that we have. But because of COVID and other things, the market kind of fell out for things like that,” he advised.

He said the market has recovered to a certain extent – and he has lined up the necessary backing from financial institutions. But that $5.7 million figure is now closer to $5 million.

“We did not get as much in the sale of the credits as we had anticipated, so it’s costing us some money out of our pocket,” he said. “But we made the calculation that even though it is costing us many hundreds of thousands of dollars more, to delay this any further would cost us more still, and that we would be disappointing a lot of people by losing the season and we don’t want to wait any longer.”

Several Funding Sources

The Ellicott Station project will be getting $425,000 from Batavia’s $10 million Downtown Revitalization Initiative award and has been approved for $3.6 million in tax abatements from the Genesee County Economic Development Center. Back in December 2016, it was awarded a $1.9 million Consolidated Application Grant through the Finger Lakes Regional Development Council.

Savarino said that the entire deal closes at the same time.

“There’s funding coming in, there’s private financing that comes into it. So, there’s a lot of moving parts, but it all comes together at a project close. After that, you can start (construction),” he said.

He said that his company has done everything it could to prepare for the financial closing, including required remedial work connected to the Brownfield applications.

“There are literally hundreds of matters that have to be attended to … prior to the closing. The good thing is that we have been at this so long that a lot of those things have been taken care of,” he noted.

But as far as shovels in the ground, nothing yet.

“When we have been notified of any issues, we have done our best to attend to them over there,” he said. “And I think we boarded up some windows and secured the fence a couple of times. I will tell you that I know some people are impatient for some activity on that site.”

Savarino said he hopes to learn the actual closing date with HCR, but realizes that the agency is dealing with many other projects across the state.

“Although we have to seek the permission of HCR to do this, I have said to people in the city that once we know we have a closing date, we can do things like let contracts out for the work and actually have equipment on the site on the day of the closing,” he said.

HCR to Decide When Things Advance

He said his company may be allowed to demolish the old garage and the Santy’s building ahead of or right after closing, but emphasized that HCR is calling the shots.

“We don’t what to get ahead of the state in this – HCR – by announcing when we’re going to start and things like that,” he offered. “Every time we do, we hear from them. We have dealt with them on several other projects. We have done our part to reach the closing, and it’s just a matter of scheduling it.”

Locally, the Batavia Development Corp. continues to be a player in the project, and Andrew Maguire has been the director of economic development for the city-supported agency since November 2019.

“The BDC continues to work with the developer of Ellicott Station -- Savarino Companies,” Maguire said. “The proposed project aligns with Batavia DRI investment strategy and the Batavia Opportunity Area plan to advance redevelopment of strategic sites in the city. Ellicott Station is one of the key sites identified.”

File photo: Sam Savarino addresses City Council, November 2016.

Batavia City Council members are so hungry for news that the Ellicott Station project is moving forward that even budget amendments pertaining to a couple of grants approved two and three years ago are cause for celebration.

At tonight’s Conference Meeting at the City Centre Council Board Room, Interim City Manager Rachael Tabelski introduced a draft resolution amending the budget to reflect a National Grid Urban Corridor grant of $250,000 on behalf of Savarino Companies LLC of Buffalo. That's the developer of the $22.5 million mixed-use brownfield project on the site of the former Soccio & Della Penna construction company and Santy’s Tire Sales on Ellicott Street.

Ellicott Station is one of several city ventures that have been awarded funds from the state’s $10 million Downtown Revitalization Initiative program. Plans for the project were first announced more than four years ago.

Tabelski said the National Grid grant that was approved in 2018 along with a Restore New York grant for $500,000 approved in 2017 are “pass through” items that the City facilitates for the developer.

She said it was an oversight that the grants previously weren’t put into a resolution form and given expenditure and revenue account designations, and “will not affect our bottom line in any way.”

“The Ellicott Station project, which everyone has heard about for many years, was awarded two grants back in 2017 and 2018 – one from Empire State Development called the Restore New York grant and that is a $500,000 grant to rehab the old electric building that’s on that site,” she said following the meeting. “That will be rehabilitated to house a microbrewery business, and the city has had success with Restore New York grants in the past. That will come to Council at the next Conference meeting next month.”

She said tonight’s National Grid resolution recognizes the city as the applicant “but the work will be done by Savarino Companies.”

“The grant is for $250,000 to enhance the Ellicott Trail on the property area right behind the Savarino campus,” she said. “The trail will be enhanced with lighting, benches, (and) there will be parking areas there as well for people to utilize the trail starting in that area. The hope is that they will also use the restaurant and brewhouse that will be on that site.”

Tabelski said the grant funds won’t be turned over to Savarino Companies until the specific projects are completed.

Council Member Rose Mary Christian expressed that her patience (and apparently that of her colleagues) has been wearing a bit thin, waiting for some activity on the large parcel that is plagued by unsightly buildings with broken windows.

“We’re still up in the air (on this),” Christian said. “I just want to be sure it’s going to go through.”

Tabelski said that Samuel Savarino, the company’s chief executive officer, is looking to close on the entire project in November and December and will be required to have all of his ducks in a row at the closing.

On Sept. 16, The Batavian broke the story that Savarino Companies received nearly $5.7 million in low-income housing tax credits from New York State Homes and Community Renewal.

Savarino called the HCR award “a critical component, which all the other commitments of the project which are in place have been waiting for.”

He said he hoped to start construction “anywhere between the fourth quarter of this year and the first quarter of next year.”

Savarino’s plan is to construct a five-story apartment building with 55 new, modern workforce housing units, as well as a brewery, restaurant/beer garden and potential further development on 3.31 acres. It is expected to create 20 jobs in the city’s downtown area.

Cost Adjustment Necessary

Council also moved to its Nov. 9 Business Meeting a resolution approving a contract increase of $26,013 for the creation of Ellicott Trail, a 9.7-mile bike and walking route that snakes through the city and down from Williams Park to Seven Springs Road.

The $1.7 million project was mostly paid by state Department of Transportation funds, with the City of Batavia and Town of Batavia sharing about 10 percent of the cost.

A complete analysis of the final expense indicate that the city owes $196,763 -- $26,013 more than the budgeted amount. The resolution authorizes the city to use some of its Consolidated Local Street and Highway Improvement Program funding to make up the difference.

Public Works Director Matt Worth said the city has a large enough CHIPs balance to absorb the additional cost without affecting future scheduled projects. He also said that maintenance of the trail should be minimal – mostly labor to periodically regroom the trail (adding stone dust when necessary).

Council Member John Canale commented that Ellicott Trail is becoming “the gem of the community,” adding that its popularity has proved the “naysayers” wrong.

Other Items Move Forward

The board also advanced resolutions pertaining to the Jackson Square DRI project, Carolwood Drive Extension, natural gas commodity contract, amending the municipal code to include public garages in I-1 (Industrial) zones with a special use permit, acceptance of a STOP-DWI “crackdown” award and Rotary Club grant for kayaking activities at DeWitt Recreation Area on Cedar Street.

Watch for details on those projects on Tuesday on The Batavian.

Previous story: City Council set to receive update on Jackson Square project consultant selection process

Update: 1:30 p.m. with comments from Steve Hyde, president and chief executive officer of the Genesee County Economic Development Center:

"Through the support of New York State Governor Andrew Cuomo and the Downtown Revitalization Initiative, more than $60 million is being invested in Batavia through brownfield redevelopment, historic building renovation, and new construction.

"In this instance, we deeply appreciate the funding support by the New York State Homes and Community Renewal for Ellicott Station. The agency is a tremendous partner in helping to revitalize our community. HCR's support for transformational projects like the redevelopment of Ellicott Station is another significant step forward for our community's continued growth."

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Buffalo developer Samuel Savarino this morning said the allocation of nearly $5.7 million of low-income housing tax credits for the Ellicott Station project is the key to moving the project forward.

“This is the critical component and major milestone,” said Savarino, chief executive officer of the Savarino Companies of Buffalo.

Savarino said that the commitment from New York State Homes and Community Renewal will enable his company to “get the investment in for the tax credits, which we are working on right now.”

“Closing and commencement of construction could occur anywhere between fourth quarter of this year and the first quarter of next year,” he said. “That depends on a number of factors, including New York State being ready to close. We’re not the only transaction they have.”

The $22.5 million mixed-use brownfield development project on the site of the former Soccio & Della Penna construction company and Santy’s Tire Sales on Ellicott Street in the City of Batavia has attracted other funding streams and tax incentives since being announced more than four years ago.

Savarino said the HCR award -- reported first on The Batavian -- is a “critical component which all the other commitments of the project which are in place have been waiting for.”

“We’re very pleased to have gotten the award. There are an awful lot of projects and an awful lot of communities competing for these awards, so I think it speaks well (for) not only the project but (also) the efforts of everybody in Batavia. It certainly is good news,” he said.

It is anticipated that construction could last for up to a year and a half.

Andrew Maguire, director of economic development for the Batavia Development Corporation, expressed his thanks to HCR and the Housing Trust Fund Corporation for their continued support and investment into the City of Batavia and its downtown.

“HCR has also provided the city several New York Main Street grant programs in the past that were executed successfully,” he said. “Most recently, the City of Batavia was successful in obtaining an award for another round of New York Main Street grant funding in the tune of $300,000.”

Maguire said state funding sources “will continue to help building owners complete rehabilitation projects with a focus on additional residentials units, which is an identified need in our city and county.”

“As we continue to see increased economic development in our city with catalytic projects like Ellicott Station, and many other projects coming to fruition, HCR, Gov. Andrew Cuomo’s Downtown Revitalization Initiative, and many other state agency programs have been an integral part of that process,” he noted.

Previously: BREAKING: NYS Homes and Community Renewal approves $5,691,573 award for Ellicott Station​