Kittinger Furniture Co. is seeking tax breaks to renovate and expand a Clarence property where it plans to relocate its manufacturing plant.
The furniture maker is requesting sales, mortgage recording and property tax breaks from the Clarence Industrial Development Agency. The company intends to move from its current home, in the Tri-Main Building in Buffalo, to a roller rink facility behind Eastern Hills Mall.
Kittinger's application for financial benefits estimates the project's cost at $1.36 million. The total includes $575,000 for land and building acquisition costs, $350,000 for a planned 10,000-square-foot addition, and $125,000 for renovating an existing 22,000 square feet.
Kittinger says it plans to move in during May 2013. The company projects its number of employees would rise from the current 16 to a total of 24 two years after completion of the project. The eight new jobs would have an estimated salary range of $25,000 to $40,000, according to the application. The company says it generates 82 percent of its sales from outside Erie County and 56 percent of its sales outside of New York State.
The Clarence IDA's application asks if a project was "reasonably necessary" to prevent the company from moving out of the state. Kittinger answered yes, saying "a major North Carolina casegood and upholstery company has expressed a major interest in the relocation of Kittinger."
Kittinger also said IDA support for the project is essential because of the "unbalanced competition that the furniture industry has experienced over the last 12 years," and because the economic situation over the past four years "has affected our cash flow."
Raymond Bialkowski, Kittinger's president, called the IDA incentives "a big factor."
"This industry (has) very tight margins," Bialkowski said. "In order for this [project] to happen, this has to be part of the package."
Tax breaks for a business moving from one community to another within New York state has been controversial in some cases. But Bialkowski said he reviewed a number of potential sites within in the city during his search for a new location. "Really nothing was able to fit the bill. Based on that, it makes the transition a little easier."
"It's not like Clarence or anybody else is trying to steal Kittinger from the city," he added.
Bialkowski said he has been scouting for a new location for the business for some time. As conceived, the Clarence site would be more convenient, located near Kittinger's retail store on Transit Road, and would be laid out according to its preferences, allowing things to run more efficiently, he said. Kittinger now operates from leased space on the sixth floor of the Tri-Main Building.
The exact dollar value of the incentives sought by Kittinger was not available Thursday. Kittinger's application will first go before the Erie County Industrial Development Agency for approval, under an intermunicipal agreement covering the ECIDA and the Clarence IDA, said David C. Hartzell Jr., the Clarence IDA's chairman.
Hartzell said the ECIDA plans to put the Kittinger incentives on its February meeting agenda. If the ECIDA does not approve the benefits, the Clarence IDA would have an opportunity to vote on the package at its own meeting later that month, Hartzell said.
Earlier this month, the Town Board approved a special-exception use permit that Kittinger needed in order for its project to go forward. Kittinger is known for producing high-end furniture, including pieces that are used in the White House.?