Niagara Gazette

May 13, 2014

City council OKs Housing Vision tax agreement

By Justin Sondel justin.sondel@niagara-gazette.com
Niagara Gazette

The Niagara Falls City Council has approved a tax agreement on a downtown housing project that was voted down last fall.

The council agreed to a 15-year tax agreement that will see Housing Visions, Inc., a Syracuse-based not-for-profit, pay 6 percent of rents collected on its project for the for the duration of the deal.

Seth Piccirillo, the city's Community Development director, urged the council to approve the agreement before it voted 4-1 in favor of the measure from Mayor Paul Dyster's desk.

Piccirillo described the deal a "payment-in-lieu-of-nothing" agreement, arguing that unlike traditional payment-in-lieu-of-taxes, or PILOT, agreements the city will be taking in payments on otherwise vacant and worthless property.

"This is not a PILOT," Piccirillo said.

The not-for-profit will take over eight vacant properties — five from the city and three from the school district — for the project, which will put up 41 rental units for low- and moderate-income Falls residents on Walnut Avenue and 5th,6th and 7th streets.

The city estimates the it will see a total of $261,000 over the course of the agreement.

In addition, the city will divest itself of all liability tied to the vacant lots and buildings and will avoid demolition costs for the houses and the former school administration building that the agency plans to renovate, Piccirillo said.

"The agenda item actually produces general fund revenue year over year, but does not request general fund revenue in return," Piccirillo said. "That's rare."

Housing Visions was awarded $2.9 million in low-interest loans and tax credits for the project by the state's Homes and Community Renewal office last month.

Voters supported the project in a school district referendum vote last fall, supporting the sale of the Walnut Avenue property and the sale of the frowner South Junior High School building to EB Emmanuel Realty, another developer by a measure of more than five to one.

Piccirillo said the not-for-profit needs the long-term deal to offer stability for the group's financing projections.

"Just like anybody who is looking to purchase and renovate they have to put equity in and finance," Piccirillo said.

In the November vote the original measure, which had a 20-year term, was defeated with one no vote, a rare circumstance.

Councilman Robert Anderson Jr. was absent, home ill. Former Councilman Sam Fruscione abstained, citing his employment with the school district, while Chairman Charles Walker and Councilwoman Kristen Grandinetti provided the only votes in the affirmative, failing to draw the three-member majority needed for passage.

Councilman Glenn Choolokian provided the only no vote in both November and at Monday's meeting.

"Everyone knows I have not supported this project in the past and I still don't support it," Choolokian said before casting his vote.

Councilman Andrew Touma, who began serving on the council in January, said he has met with Housing Visions officials and has toured a similar project the agency completed in Lockport.

"I obviously believe it's going to improve the quality of life for citizens in that area," he said.

In other news;

• Mayor Paul Dyster pulled his proposal to enter the city into the the state's Financial Restructuring Board for Local Governments during the work session of Monday's meeting. Dyster, along with Touma and Anderson, have met with city unions in recent weeks to discuss the advisory program, but the mayor said he wished to wait for the recommendations the board is set to issue in Fulton, N.Y. later this month, so they might use those recommendations as a discussion point before asking the council to vote again on the matter. The council unanimously defeated a measure from Dyster's desk last year asking to join the newly created program.

• The council unanimously approved a measure that will allow the city to execute a deal with the owners of the Sheraton at the Falls hotel downtown to set up a police substation for the department's new rangers program. The department will hire college-age people to help tourists downtown and create a larger police presence during the tourist season.

•The council defeated a resolution asking for the allocation of $40,000 to put on a concert on Old Falls Street this August in conjunction with the Hard Rock Cafe. Anderson abstained from the vote while Choolokian and Touma voted no and Walker and Grandinetti voted yes.