Orleans EDA provided some help with Ace, other retail projects

By Tom Rivers, Editor Posted 3 June 2013 at 12:00 am

State tries to limit tax incentives for retail, but allows exceptions

Photo by Tom Rivers – The new Ace Hardware store at the former Jubilee in Medina received some assistance from the County of Orleans Economic Development Agency.

MEDINA – It sat empty for nearly seven years. The roof had started to cave in and vandals had free rein inside. The former Medina Jubilee hadn’t generated any tax revenue, either, for several years.

Clearly, it was a property in distress, said Jim Whipple, chief executive officer of the County of Orleans Economic Development Agency.

The Orleans EDA worked with Roger Andrews, owner of two Ace Hardware stores, to redevelop the site into a hardware store and lumber yard. The agency approved a $140,000 loan for the $1.2 million project. The EDA also established a 10-year tax plan that freezes the tax payments at $5,386 annually. That money is divvied up for the village, town, county and school district.

Tax incentives for retail operations have come under fire in the state. They are no longer allowed, as of April 1, unless the property is in a highly distressed area or if it is a tourism project. The Ace incentives were approved before the new law took effect, but Whipple said the incentives would pass muster under the new state policy.

“If you look at that property before, the roof was falling in, and look at the difference now,” Whipple said. “It’s made a huge difference in that area of the village. It’s right across from a park. It’s cleaned up that whole area of the town.”

Although the IDA provided some assistance with the project, Whipple noted that Andrews bore the vast majority of the expense. The site was owned by the county because the taxes were delinquent for several years. Andrews paid the county $100,000 upfront to offset the back taxes and part of the penalties.

The county agreed to take down a small drive-through structure by the building, remove two petroleum tanks and pave the parking lot after Andrews bought the materials for the project. Whipple noted the county was technically the property’s owner before Andrews acquired it.

Andrews also received a sales tax exemption of about $50,000 for building materials and other store improvements as part of the project. The new store opened in April.

Andrews said the project is now generating tax revenue for the community, as well as complementing the village’s historic downtown a few blocks away. Andrews owns an Ace near Hamburg and bought the former Hahn Hardware in Medina about two years ago.

“We paid the back taxes and the property is back on the tax rolls,” Andrews said. “We put the right project in this spot. It would have been a shame to let this building sit.”

Tom Snyder, owner of Medina Lumber and Hardware, has decried the IDA assistance for the Ace project. Some other community members also didn’t think it was fair to Snyder.

But Whipple said the property, which was certified as part of a distressed Census tract by state officials, is now a community asset. He praised Andrews for stepping up and tackling the ambitious renovation of a 26,000-square-foot building.

“A guy like that comes around once in a lifetime,” Whipple said about Andrews. “He took a major structure that was destined for the wrecking ball and totally renovated it.”

The IDA has provided some help to two other recent retail projects. The owners of The Village Inn in Gaines spent about $325,000 on a renovation last year. The IDA approved a sales tax exemption for the project that saved Mark Tillman, the restaurant owner, about $3,000. Whipple said the restaurant is a draw to people outside the county.

The Save-A-Lot in Holley, which also targeted a former Jubilee store, was approved for a loan and property tax abatement for the remodeled portion of the building. Those incentives were offered before the retail law took effect, but Whipple said the project would qualify under the new rules because the federal government classified Holley as a “food desert,” a community without a grocery store.