EDA approves nearly $600K in property tax breaks for former Chase site

By Tom Rivers, Editor Posted 17 January 2014 at 12:00 am

ALBION – The Orleans Economic Development Agency approved nearly $600,000 in property tax breaks for the new owner of the former JP Morgan Chase site in Albion, a 130,000-square-foot building that will soon be home to about 700 employees for Claims Recovery Financial Services.

A firm led by Roger Hungerford of Medina bought the building from Chase for $2.6 million and has invested at least $300,000 in upgrading the site for CRFS, EDA officials said this morning.

The EDA based the incentives on a $2.9 million value for the property. At that assessment, the annual tax bill would be $109,752 with the money going to the village of Albion, town of Albion, Albion Central School and Orleans County. The four municipalities have a combined tax rate of $45.73 per $1,000 of assessed property.

The owner, 231 East Avenue LLC, won’t pay any taxes the first year to the four municipalities, and will pay 10 percent of the $109,752 the second year, with another 10 percent added the following years until it’s at 100 percent after a decade. The deal will save 231 East Avenue LLC $592,661 in property taxes and also commits the entity to paying $504,859 to the four governments over the 10 years.

The library tax rate of $1.30 per $1,000 is not part of the PILOT (payment in lieu of taxes) agreement. The library will get its full $3,700 per year.

The EDA did a cost-benefit analysis and determined the building will generate $47,467,359 in benefit to the county over the 10 years, mostly through the salaries of the new employees as part of the company expansion.

Jim Whipple, EDA executive director, said the site will give back $80 for every $1 given up in the tax abatement. The EDA calculated the benefits based on 315 new jobs over three years as part of a CRFS expansion. Whipple said the EDA numbers are conservative because the company employs nearly 700 people in the county.

The company considered other sites for its expansion, including Atlanta, Ga.; Dallas, Texas; San Antonio, Texas; and Jacksonville, Fla., the EDA said.

The site at 213 East Ave. was owned by Chase, but that company shut down in Albion in September, eliminating about 400 jobs.

CRFS is experiencing exponential growth. It has outgrown 31,000 square feet next door at 227 East Ave. Hungerford and his firm, Talis Equity, spent about $1 million renovating about 15,000 square feet of the Olde Pickle Factory in Medina to accommodate about 200 CRFS employees last year.

The CRFS workers from Medina and Albion will all be moved into the former Chase site, which has room for the company to expand and keep the workforce under one roof.

Gabrielle Barone, vice president of business development for the EDA, said Hungerford has worked hard to accommodate CRFS so the company had space to grow in Orleans County.

“He did a huge renovation in Medina and he took on this building,” Barone said. “He wants to keep this company here.”

The EDA sees another benefit with CRFS moving into the former Chase site. The other CRFS locations – the Olde Pickle Factor and next door in Albion at 227 East Ave. – are good sites that can be aggressively marketed for new tenants.

CRFS will have a presence at 227 East Ave. until at least late February. It moved out of the Pickle Factory about two weeks ago. The EDA will work with the Greater Rochester Enterprise and the Buffalo Niagara Enterprise – big regional economic development agencies – to help market the Medina location.