Assemblyman Sean M. Ryan is urging the Clarence Industrial Development Agency to put the brakes on considering tax breaks for Towne Automotive's planned new Mini car dealership.
The Buffalo Democrat, who has urged IDAs to be more selective in awarding incentives, weighed in after the Clarence IDA last week was asked by Towne Automotive to reconsider its request for tax breaks.
The Clarence IDA in October informally decided not to review Towne's request, believing the $1.9 million project on Main Street would go forward anyway. But last week, a Towne official told the Clarence IDA board there was no guarantee the project would happen without incentives.
Ryan, in a letter to Clarence IDA Chairman David C. Hartzell Jr., urged the agency to stick with its original position: "I am making a simple request to the CIDA: don't give in to more corporate welfare."
Hartzell said in response to Ryan's comments on Tuesday: "While Towne has requested a second look at their proposal, no decision has been made."
Towne Mini shares space with a Towne BMW dealership on Main just east of Transit. The new stand-alone location would be built on vacant land across the street. The dealer group has received development plan approval for the project from the town. Towne has the only Mini franchise in Western New York; the next closest location in the state is in Rochester.
Ryan in his letter noted there are a number of other car dealerships around the Main-Transit area. "Not only is it inherently unfair to subsidize one car dealership over the others, it does not meet the definition of the type of businesses industrial development agencies should be supporting," he wrote.
David M. Downing, vice president of Towne Automotive, told the Clarence IDA last week that building a new dealership would allow Towne to double its allocation of Minis to 600 per year. He estimated that selling an additional 300 Minis would generate $650,000 in sales tax revenue, and he said the new dealership would create 11 new jobs – nine at the Mini location and two at the BMW dealership.
Ryan, in his letter to Hartzell, acknowledged the project would generate more sales tax revenue. "However, this project will move forward even without taxpayer-funded subsidies," he said. "If Towne Mini wants to expand, good for them, that is what capitalism is all about. If they see an opportunity to improve their business, then they should put the risk and investment into making it happen. The taxpayers of Erie County shouldn't be expected to subsidize their venture."
Ryan has called for reforming the IDA system in Erie County, arguing that property and sales tax breaks reduce the amount of new revenues generated for municipalities and school districts across the county, not just in the community where the project occurs.