B U F F A L O N E W S
New Erie County Executive Chris Collins sent a message Thursday to businesses in the county: if you want a tax break, you’d better justify it.
Collins flexed his economic development muscles and showed some of his views Thursday by questioning the need for sales tax incentives for an expansion by Martin’s Fantasy Island.
The Grand Island amusement park had asked the Erie County Industrial Development Agency for $87,000 in tax breaks to help it buy new equipment for two new rides slated to open this spring. The equipment is valued at more than $850,000.
The park, owned by Martin Di- Pietro, has received similar benefits to install rides in 2006 and 2007, with no challenge. But this time it ran into opposition from an administrator who has stated his intent to apply a business approach to government.
Collins, a member of the ECIDA board, said at the agency’s monthly meeting that the park would probably go ahead with the expansion anyway because it needs to remain competitive. So, there’s no need for the county to give them an incentive to go forward, he argued.
In fact, the Fantasy Island Web site already has the two rides listed as coming attractions.
“I really think the taxpayers are giving in this case a subsidy to Martin’s Fantasy Island that isn’t necessary,” Collins said in an interview. “They’re going to buy that piece of equipment anyway regardless of whether they get the sales tax exemption.”
The question sparked a discussion among board members and agency staff about whether they had enough information to make a decision, and about the appropriateness of providing tax breaks to tourism, entertainment and quality- of-life “destinations.”
The proposal was eventually tabled until the Feb. 11 meeting so that Fantasy Island can provide more information about how the project would benefit Erie County. And the board adopted a moratorium on approving any other such retail or tourism projects until its policy committee can review the issues.
“At this point in time, it was sent back for further discussion to analyze the exact reasons why this facility needs this help,” said Alfred D. Culliton, ECIDA’s chief financial and chief lending officer. “No one said we wouldn’t do it. It’s just a matter of . . . [getting] some greater detail. Tourism destination projects are pretty uncommon around here.”
Collins’ question marked one of the few times a board member has raised a challenge to an incentive package after the proposal has already been vetted by the agency’s staff. It also demonstrated that he plans to take a tougher line on some projects.
“My job is to protect the taxpayers of Erie County, to make sure we’re helping businesses stay competitive and giving them incentives where needed. But the important thing is ‘where needed,’ ” he said. “If they’re justified, I’m going to definitely be on board.”
In this case, Collins said the company had not proven its case. Fantasy Island argued the project would help it remain competitive, and ECIDA officials noted that Genesee County provides similar benefits to Darien Lake.
Fantasy Island also cited research that 27 percent of its visitors are from Canada, justifying its designation as a tourist destination. But it didn’t say how it would create or retain any jobs.
“When someone asks for $87,000 and they’re not creating any jobs, a red flag goes up. At what point in time is it proper for a public sector entity to partner with an individual business where they’re not creating any jobs?” Collins said.
He and others on the board, including Buffalo Niagara Partnership President Andrew J. Rudnick, said they just didn’t have the answers they needed to make a decision, because agency staff hadn’t asked all the questions. And Collins cautioned that, in his new role, he’s not going to just approve proposals without reading them and considering them.
“I don’t rubber-stamp them,” he said. “This one raised some red flags for me.”
ECIDA Chairman Dennis Penman said the county executive may “want to raise the bar” on how much background work is done in evaluating proposals.
“The county executive is protecting taxpayers dollars, by making sure that there’s going to be a real return on our investment,” he said. “He’s doing it from a business perspective.”