Strictly Business

A contingent including representatives from 12 area life-sciences companies and the major institutions on the Buffalo Niagara Medical Campus is in Chicago this week for the BIO International Convention.

The delegation is attending the convention for the first time under the “Buffalo Niagara BIO” brand after taking part for the past five or six years as a member of the larger “New York Loves BIO” group.

The convention, which began Monday and runs through Thursday, is the largest international event for the biotech industry and typically draws 20,000 people and company representatives, offering important networking and business opportunities, according to Buffalo Niagara Enterprise, one of this year’s participants.

In addition to the BNE, local convention attendees include representatives of the New York State Center of Excellence in Bioinformatics and Life Sciences, the Hauptman-Woodward Medical Research Institute and companies such as Empire Genomics, QuaDPharma and Immco Diagnostics.

-- Stephen T. Watson

Back in March, the Erie County Industrial Development Agency slammed the brakes on giving tax breaks to hotel projects following the uproar sparked by its handouts for a remodeling of the Millennium Hotel in Cheektowaga.

The critics rightly questioned the economic value of doling out tax incentives for what should be the normal cost of doing business for an existing hotel - replacing furnishings, carpeting and the like.

So the IDA went back to the drawing board to revise its policy on hotel tax breaks. In July, working on its own and without consulting the five other suburban IDAs in Erie County, the Erie County IDA came up with a new proposal. That proposed policy would that would limit incentives to only hotels that are built or renovated in conjunction with a convention center, conference center or a major regional attraction. It also would permit aid to hotel projects that meet the IDA's adaptive-reuse policy, which encourages renovation of vacant buildings.

The adaptive reuse clause was a significant loophole, because it opens the door to hotels in any site that reuses an existing building that's been vacant for a few years.

But that didn't satisfy the suburban IDAs, who within the last month met with IDA officials. They wanted more flexibility, and they managed to get an extra phrase added into the policy the Erie County IDA approved on Wednesday that allowed projects that were part of a neighborhood enhancement area.

Now that's a loophole! In Amherst, much of the town's prime commercial property is part of an enhancement zone. Want to build or renovate a hotel on Sheridan Drive between Niagara Falls Boulevard and the Youngmann Expressway? You're in, because it's part of an enhancement zone.

Want to build a hotel or renovate one on the west side of Transit Road, between the Thruway and Main Street? There likely will be some tax breaks waiting for you, because it's part of an enhancement zone.

Think there's a market for another hotel along Main Street. Pick the right spot and you'll be in line for some hefty tax savings, because wide swatches of Main Street are part of an enhancement zone.

So much for the crackdown.

- David Robinson

Developer Rocco Termini has an interesting article today on the News' editorial page, pitching a plan to finance the $200 million or so it will take to finance the improvements the Buffalo Bills want at Ralph Wilson Stadium.

The linchpin of Termini's plan is to take the roughly $13 million in payroll taxes that the Bills pay each year and setting it aside to pay off the bonds that will be issued to pay for the stadium improvements. By Termini's calculations, setting those tax payments aside over a 15-year period (assuming the Bills sign a 15-year lease) would cover about three-quarters ($150 million) of the improvement costs.

The second part of Termini's plan is to sell the naming rights on Ralph Wilson stadium and use those proceeds to pay off more of the stadium improvement debt. If those rights sell for $4 million a year, that would provide enough money to pay off another $45 million of the stadium debt (plus interest at 4 percent a year).

Selling the naming rights would be a blow to Bills owner Ralph Wilson's ego, but it's the least the Bills owner can do if he's trying to shake down the state and the Buffalo Niagara region for $200 million in upgrades. It's always run pretty hollow that Wilson has complained about how limiting the Buffalo market is financially, while leaving several million dollars a year on the table so he can have a stadium named after himself.

Put those two together, and you've managed to finance $195 million of the $200 million in upgade costs, Termini argues.

Does Termini's proposal have a chance. Probably not. It's too simple and it makes too much sense. But it sure is an interesting thought.

- David Robinson

No one is really getting their hopes up, but the latest buzz is the idea that Buffalo could team up with Toronto to make a joint bid to host the 2024 summer Olympics.

 But it does bring up the fascinating topic of what goes into hosting the global games.

Hosting this year's Olympics hasn't done much to pull London out of its recession. In fact, they are further in the hole after going over their $14.7 billion budget. This article from CBC News takes a look at how astronomically the tab has grown to host the games and with what kind of debt the games can saddle its host city.

This article from Bloomberg Businessweek says Greece's current fiscal crisis can be traced back to its hosting of the Olympics in 2004:

Hosting the event cost almost €9 billion ($11 billion at today’s exchange rate), making the 2004 Games the most expensive ever at that point. Greek taxpayers were on the hook for €7 billion, which did not include the cost of extra projects such as a new airport and metro system.

Within days of the closing ceremony, Greece warned the euro area that its public debt and deficit figures would be worse than expected. 

And this article from the Atlantic spells out "3 Reasons Why Hosting the Olympics is a loser's game."

---Samantha Maziarz Christmann

Gov. Andrew M. Cuomo's $50 million advertising campaign to attract businesses to New York State is set to launch next week. The money will pay for ads around the country letting business owners know that New York is "open for business."

There is debate over whether that is money well spent.

The Manhattan-based agency that landed the contract to handle the campaign, BBDO, is certainly happy about the launch, as are many economic development agencies and other groups.

But not everyone is singing the project's praises.

"If Governor Cuomo really wanted to make New York "open for business," he could do it without spending a dime," writes the Suffolk County Liberal Report. "Just focus on cutting the three New York State business killers--taxes, regulations and eco insanity."

Cuomo has also vowed to pump $1 billion directly into the Buffalo economy in the form of incentives offered to companies willing to build or expand here. In his keynote address at The Buffalo News' Prospectus launch, M&T Bank CEO John R. Koelmel said the money presents the opportunity of a lifetime.

"We as a region need to get behind and help--and be part of what will be and must be a real success. We finally have a road map for sustainable success, and we just need to get after it," he said.

 What do you think? Is this influx of money a good investment in Buffalo and New York State?

From Business Today:

 Retailers in Western New York know what a boon Canadian shoppers are to their bottom line, but businesses in other industries apparently don't, according to new market research. Visiting Canadians spent $933 million here last year, but just 13 percent of it was spent on sightseeing and recreation. That's an untapped audience with huge potential and spending clout. Executives from Visit Buffalo Niagara and the Niagara Tourism and Convention Corp. shared ideas for how local businesses could better take advantage of the opportunity at two seminars Monday.

A public authority oversight agency has determined that, according to current laws, a company that eliminated workers here committed no job piracy. After taking 15 years of tax breaks from the ECIDA, VWR Education eliminated 41 jobs at its warehouse in the Town of Tonawanda. At the same time, it added seven jobs at its facility near Rochester, and received tax breaks from the Monroe County IDA for doing so. Politicians and activists filed a complaint, saying the company was shifting jobs around New York State at taxpayer expense, but the New York State Authorities Budget Office disagreed, according to a report resulting from its investigation.

Profits were up during the first quarter at a Buffalo-based information technology staffing and services company. Computer Task Group saw an 18.8 percent increase in profits. It reported net income of $3.36 million, or 20 cents per share, up from 42.83 million, or 17 cents per share, compared to the same period a year ago. The increase is attributed to higher revenues, especially from electronic medical records and other health care technology solutions.

After being ordered by state regulators to check their insurance records against federal death data, life insurance companies found that hundreds of millions of dollars in insurance policy claims have gone unpaid. More than 30,000 policies and $262.2 million in benefits went unpaid because insurers failed to check whether their policyholders had died. In New York State, 7,525 policyholders have received $95.9 million in unpaid benefits. The results came after an investigation was launched by the state Department of Financial Services. To search for a lost policy, click here.

Who is getting hired, promoted and honored?

Looks like another lovely spring day:

From Business Today:

The job-growth rate in the Buffalo Niagara region accelerated in March. The region saw a one percent annual growth rate compared to the same month last year, adding 5,400 jobs. It's the strongest growth rate in six months. The labor department attributes the improvement to strong growth in construction work and a rebound in manufacturing.

Sprint Nextel Corp. has been purposely dodging taxes since 2005, according to Attorney General Eric Schneiderman. The cell phone company failed to collect $100 million in state sales tax from customers, ducking out of its obligation to pay New York State $200,000 per week. Schneiderman called the failure to pay a "deliberate" plan to keep the cell phone company's prices more competitive.  

  The blast that killed a welder and injured an Angola man two years ago was partly caused by procedures followed at the DuPont plant on River Road in the Town of Tonawanda. According to a report released Thursday by the U.S. Chemical Safety and Hazard Investigation Board, technicians should have tested the tank the welders were working on to be sure they weren't flammable.  

 The Clarence Industrial Development Agency will consider tax breaks for a new office park on Sheridan Drive near the Eastern Hills Mall. The IDA will hold a public hearing next month in consideration of granting tax breaks to the $2.1 million project. The Rockledge Professional Office Park is being proposed for vacant land at 8175 Sheridan Drive, on the south side of the street, just east of Transit Road.

Profits soared at First Niagara Financial Group during the first quarter. First-quarter profits were up 22 percent from a year ago, thanks to higher loan and fee revenues offsetting higher expenses from an acquisition in Connecticut. The company reported net income available to common shareholders of $54.8 million, up from $44.9 million.

 Who is getting hired, promoted and honored?

I'll bet Grant Cardone is glad it's Friday. The motivational speaker who appeared in Buffalo this week was on the Delta flight that had to make an emergency landing after striking birds. Here is a video from Cardone after it happened:

From Business Today:

Seven sheriff's deputies stood sentinel at the Erie County Industrial Development Agency's board meeting Monday. The board had requested security to discourage outbursts from members of the Occupy Buffalo movement, who have attended and disrupted two previous meetings. Erie County Executive Mark C. Poloncarz said the show of force was "overkill." But the sheriff's office said it received an anonymous call saying Occupy Buffalo had planned to create a disturbance, so it sent more deputies in response to the call.

Developer Carl P. Paladino will receive tax breaks on a $5.3 million project to convert the Graystone Building into 42 apartments. The Erie County Industrial Development Agency agreed Monday to approve nearly $213,000 in sales and mortgage tax breaks for the project. Paladino has received a host of financial incentives to restore the vacant building, including including $1.2 million in historic tax credits from the state.

Compared to a year ago, profits were flat for the first quarter at M & T Bank Corp, the Buffalo-based parent of M&T Bank. Per-share earnings fell. Despite higher loan and fee revenues and lower credit costs, the purchase of Wilmington Trust Corp. resulted in higher operating expenses. The company had net income of $206 million. Per-share profits fell by 5.7 percent, to $1.50, from $1.59 a year ago.

 Rep. Kathleen C. Hochul, D-Amherst is proposing the Workforce-Ready Educate America Act, which would give employers a $1,000 tax credit for each student placed in qualified training program. The legislation is intended to bridge the gap between unemployed graduates and companies with unfilled positions.

Who is getting hired, promoted and honored?

 Esperanza Spalding will perform at UB tomorrow night:

From Business Today:

Ford Motor Co. uses virtual reality technology to test automobile design years before the protoypes are ever even made. Company representatives brought that technology to Erie Community College Tuesday to give about 50 automotive technology students a taste of how it works. Students got to virtually test out a 2013 Ford Fusion, the makers of which relied heavily on the virtual technology when designing it.

API Heat Transfer has gotten its fourth new owner since 2002. Wellspring Capital Management, a New York City private equity firm, acquired the business from another private equity firm, Industrial Growth Partners in San Francisco, Calif. The company employs 178 workers at its Arcade plant and has plants in Germany and China. The Cheektowaga-based company makes industrial heat exchangers.

Penora's Pizza, a Depew pizzeria, and Bella Vista Group, the owner of an office and warehouse facility at Transit Road and Genesee Street, came seeking tax breaks from the Lancaster Industrial Development Agency Tuesday. But with IDAs under increased scrutiny for giving aid to projects of questionable value to economic development, those requests were tabled for further review.

First Niagara Financial Group board member and co-director Carl A. Florio has stepped down from the bank board's audit committee. Florio's decision to leave came after Institutional Shareholder Services and Glass, Lewis & Co recommended shareholders vote against re-electing him, questioning his independence from management. The two independent proxy advisory firms did not consider Florio an "independent director" by their standards.

A 127-year-old Jamestown company is nearing its final end. Crawford Furniture, which filed for Chapter 11 bankruptcy protection in August and ran going-out-of-business sales at its retail locations, has been granted approval by the bankruptcy court to liquidate its remaining assets, including its property and equipment. The hardwood furniture maker's assets will be up for sale through April 19. Whatever is left will go to auction April 21.

Who is getting hired, promoted and honored?

Here's a closer look at Ford's virtual reality technology:

 

From Business Today:

Gary Hydock is taking another shot at the radiant heat business. He has acquired an East Side building, on Northampton Street near Genesee Street, and brought in some investors. Modular Radiant Technologies will market the panels to businesses, which Hydock believes are ready to drastically cut their heating costs. Hydock bet on radiant heat in the past with GCS Radiant, but that company folded in 2009 when customers began cutting back home-improvement spending.

A vacant former food plant in Wilson has a new owner. The former Pfeiffer Foods plant on Lake Street has been sold to Lawta Properties LLC for $419,000. Lawta owns and leases several parcels in Wilson, on most of which it grows corn. It did not respond for comment as to what the new site would be used for. Pfeiffer Foods was Wilson's largest private employer, employing 150 people to make salad dressing. Those jobs were consolidated to another facility in 2009 and the building has sat empty for three years. 

Businesses in Cheektowaga may be eligible for a low-rate loan from the Cheektowaga Economic Development Corp. The agency is offering five-year loans with a 0.5 percent interest rate to manufacturing, warehousing and wholesale distribution companies in the town to help them create jobs. Retail and service trade companies might also be considered. According to the job creation requirements, at least half of the jobs must go to workers who currently have low to moderate incomes. For more information, call 897-7200, Ext. 6, or visit Cheektowagadevelopment.com. 

Who is getting hired, promoted and honored?

The weather forecast calls for a high of 57 degrees and mostly sun: