Proposal to curtail sales tax exemptions could hamper job growth projects locally
A proposal by Gov. Andrew Cuomo to curtail sales tax exemptions on new development and redevelopment projects could hurt such projects locally, according to City Manager Jason Molino and Steve Hyde, CEO of the Genesee County Economic Development Center.
"Losing the ability to offer state portion of sales tax exemptions dilutes our financial assistance offerings at the local level," Hyde said. "That hurts since we remain the 49th most expensive state to do business in."
Nearly all projects that come to the Industrial Development Agency for assistance and the promise of job growth receive a sales tax exemption on building materials, plant expansion and/or new equipment.
The City of Batavia has been aggressively pursuing projects that redevelop commercial parts of the city -- called "brownfield redevelopment" -- and the loss of the sales tax exemption could be a setback for those plans.
While Molino is reserved in his judgement since the governor's budget is still in the early proposal phase, he said if the elimination of sales tax exemptions goes through, it won't be good for Batavia.
"I think it has the potential to negatively affect any economic development effort that would use sales tax exemptions as part of its model for development," Molino said.
Hyde said much of the redevelopment necessary in the city won't qualify for the state's "excelsior program," which provides tax credits for strategically targeted industries, so maintaining the sales tax exemption is critical.
"We can support some really exciting things developing in the city to the fullest extent possible," Hyde said.
The Buffalo News carried a story this morning about how the budget proposal will be a setback for redevelopment in Buffalo.
Hyde encouraged constituents to reach out to the governor's office and express concern about the proposal.
"This topic is important as community development projects will be negatively impacted considerably and those are the lifestyle projects important to our residents," Hyde said.