The Lancaster Industrial Development Agency on Tuesday approved $281,000 in tax breaks to support the move of a company from Cheektowaga to a vacant building in a Depew industrial park.
Xpedx, a division of International Paper, plans to invest $1.15 million and add 14 jobs as it consolidates operations now performed at facilities in Cheektowaga, Rochester and Erie, Pa.
The IDA board approved the tax-break package over objections from one Depew resident, who argued that the property owner, Uniland Development Co., already received a payment-in-lieu-of taxes, or PILOT, agreement on the building.
"The positives outweighed the negatives to bring these people in," said Depew Mayor Steven P. Hoffman, an IDA board member.
Xpedx employs 32 people at 75 Allied Drive in Cheektowaga, where it leases a 48,000-square-foot facility, according to the IDA. The company informed the agency that it plans to hire 14 more people at its new, 122,000-square-foot building in the portion of Depew within the Town of Lancaster. Uniland got a PILOT for the building, at 3344 Walden Ave., that expired in 2009.
While resident Daniel E. Beutler complained at Tuesday morning's IDA meeting that Uniland received tax breaks to construct a "spec" building, Peter A. Sayadoff, director of Uniland's capital markets group, replied that the building was constructed on behalf of a tenant.
Construction began in 1999, but the tenant, Skulogix, vacated in 2006, Therese J. Hickok, a Uniland spokeswoman, told The Buffalo News.
Sayadoff defended the request for tax breaks. Exemptions include $246,072 on property taxes, $30,744 on sales taxes and $4,390 on mortgage recording taxes. "Uniland is not getting the tax breaks. … We're passing them on to the client," he told Beutler.
The property tax exemptions are limited to five years because the building already received a PILOT, said Paul R. Leone, an IDA consultant. He said IDA representatives met with Cheektowaga officials, who endorsed the company's move.
Xpedx, a supplier of packaging products, facility maintenance products and printing supplies, plans to spend $1.15 million on the move, including $702,732 on renovations to the warehouse and office space.
All of its Cheektowaga operations, and some work performed in Rochester and Erie, will be moved to the facility. Leone pointed out that Lancaster was competing with Batavia, Rochester and Syracuse for the new facility.
Lee Chowaniec, a Lancaster resident who closely follows the operations of local government, asked why "two financial titans," International Paper and Uniland, need a tax break. "Both companies have money," Chowaniec said.
But the board, with William D. Tate Sr. absent, voted, 6-0, to approve the tax-break package.