A proposed $100 million building on the Buffalo Niagara Medical Campus hit a roadblock Tuesday when Erie County Executive Mark C. Poloncarz and three other community leaders objected to tax breaks for what they called a “glorified medical office” unworthy of taxpayer help.
But advocates and tenants of the proposed building say the medical office, research and clinical facility is crucial for the Medical Campus, including construction of a new children’s hospital and University at Buffalo medical school.
“It’s a critical piece to the growth here and what we’re trying to do,” said Matthew K. Enstice, president and CEO of Buffalo Niagara Medical Campus Inc., the umbrella entity created in 2001. “I’m surprised by the criticism. … It seems like a no-brainer.”
The $4.24 million in tax breaks for the facility are not dead, as the Erie County Industrial Development Agency delayed a vote Tuesday until next month after failing to garner the necessary support to pass the resolution. But Poloncarz and three other board members criticized the plan, saying the development and growth of the Medical Campus should serve as enough of a draw and an incentive to ensure that such projects happen, anyway.
“We have invested millions of dollars on the Buffalo Niagara Medical Campus under the premise that private developers will invest their money and we don’t have to,” Poloncarz said.
The delay caught many at the meeting by surprise, especially the project’s developer, Paul Ciminelli. After the meeting, a visibly angry Ciminelli denounced the delay and the criticism.
“Clearly, the county executive has to get a better understanding of what’s going to happen in the building,” he said. “Anyone who thinks that this is just another doctor’s office is not understanding what this is all about.”
The developer’s project – called Conventus, which is Latin for “coming together” – calls for construction of a 287,000-square-foot, six-story medical office building that would be physically linked to the planned new pediatric hospital and UB School of Medicine and Biomedical Sciences. Construction alone would cost $82 million, and Ciminelli already has spent $10 million on environmental cleanup.
Most of the building would be devoted to clinical, practical and research space, with key tenants including Kaleida Health and the UB medical practice known as UBMD occupying four floors. Both are nonprofits that would not pay taxes if they built a facility on their own, ECIDA officials noted.
Plans are also in the works for a medical research collaboration on the upper two floors between UB and Elma-based aerospace company Moog, which also has a medical devices division.
“It’s not like we’re going to go out and lease to Cellino & Barnes or something,” said Ciminelli Executive Vice President Dennis M. Penman. “It’s for medical research.”
The first floor would include retail space to support the Medical Campus, such as a First Niagara Bank branch, a pharmacy and limited food service, while the building also would have two levels of below-ground parking for 332 vehicles. About 100 new jobs would be created, but more than 1,100 jobs would simply move from elsewhere.
At the ECIDA meeting, Poloncarz was joined in opposition by World Trade Center Buffalo Niagara President Christopher Johnston, Amherst Supervisor Barry A. Weinstein and Buffalo Urban League President Brenda W. McDuffie.
Poloncarz described the project as another example of local industrial development agencies “moving pieces of the chessboard around” because the jobs already exist elsewhere in the county and are being moved downtown. He and others argued that doctors’ offices are not eligible for incentives under county policy, while research and back-office would be.
“This is a good project,” Weinstein said. “I hope it gets built, but I am opposed to giving tax incentives to medical offices.”
Frank B. Mesiah, president of the Buffalo branch of the NAACP, abstained because of inadequate information, after criticizing the lack of assurance of jobs and opportunities for residents of surrounding neighborhoods and even the city overall. As a result, supporters mustered only nine votes in favor, one short of what was needed to approve the incentives.
Advocates defended the project, citing opportunities for research collaboration and noting that it fits with the regional economic-development focus on health care. “It’s going to have a major impact,” said Buffalo Mayor Byron W. Brown. “This will also provide greater access to people in the City of Buffalo that are medically underserved. … Without these incentives, we put this project at risk.”
Officials for Kaleida said the Ciminelli building is essential for the new children’s hospital, as Women & Children’s is moving from its longtime Bryant Street location in Elmwood Village to the downtown Medical Campus.
“This building is the linchpin for bringing Women & Children’s downtown and for linking it with the other projects on the Medical Campus,” said Michael P. Hughes, spokesman for Kaleida Health, whose umbrella includes the children’s hospital. “It’s not a typical office project.”
Groundbreaking for the new hospital, to be renamed John R. Oishei Children’s Hospital, is expected in the spring, with completion in early 2016.
As planned, the pediatric outpatient surgery center in the new children’s hospital would use space in Conventus, which would act as the “front door” of the surgery center. The second and third floors of the Conventus building would connect to the pediatric hospital, which will connect to Buffalo General Medical Center.
The idea is that the Ciminelli building, with its convenient location at Main and High streets, would be where patients and families check in, receive outpatient care and make a transition to the main hospital for surgery or overnight stays, if needed, Hughes said.
“The opposition is surprising and a bit troublesome when you consider the importance of the Women & Children’s Hospital piece. It’s a big initiative for us,” Hughes said. “Hopefully with time and more education, people will see the unique nature of the project.”
UBMD is the practice plan that includes about 500 physicians who are also professors at UB who teach doctors-in-training and perform research.
Its plans for the Ciminelli building include space for doctors now based at Women & Children’s, as well as space for dozens of new physician-researchers UB intends to recruit in the next few years, said Renee A. Filip, chief operating officer.
However, there is a larger goal than new space, she said. UB plans to relocate the medical school from its South Campus to the Medical Campus starting this fall, in a project estimated at $375 million. The move presents UB with a chance to bring more physician-teachers to a central location. “It’s an opportunity for the doctors to be in the middle of the medical hub where they can see patients and teach medicine. It’s about more than bricks and mortar. It’s about having a connectivity between buildings and organizations. It’s about an investment in intellectual capacity downtown,” Filip said.
ECIDA Chairman John J. LaFalce moved to table the proposal for the $4.24 million in tax breaks until the next meeting in March, allowing more time for Ciminelli officials to address the concerns of critics. The package includes $3.5 million in sales tax breaks and $740,000 in mortgage tax relief, but no city or county property tax cuts.
“I’m absolutely shocked … that a $100 million private-sector investment had its back turned to it,” Penman said. “It sends the wrong message to Albany with $1 billion committed.”
The Medical Campus has seen major construction in recent years, with the Gates Vascular Institute, UB’s Clinical and Translational Research Center and Kaleida’s nursing home, HighPointe on Michigan.
In addition, UB is building a new Educational Opportunity Center, which will connect with UB’s Downtown Gateway building, formerly known as the M. Wile Building, and Roswell Park Cancer Institute is preparing to build an 11-story Clinical Sciences Center at the northwest corner of Michigan Avenue and Carlton Street, abutting the cancer center’s main building.
There are now about 12,000 people working on the Medical Campus. By 2016, officials expect employment to grow to 17,000.