The Erie County Industrial Development Agency on Monday approved a total of just over $1 million in tax breaks for two projects – a new manufacturing operation at the former American Axle plant in Buffalo and a major renovation at Calspan Corp. in Cheektowaga.
The agency’s board approved $355,135 in tax incentives for Ontario Specialty Contracting Group, which is spinning off a new “green machine” division to make mini-excavators that run on electricity instead of gas or diesel fuel. The machines were designed by Noah Podolefsky, son of Aaron Podolefsky, the former SUNY Buffalo State president, who died this month.
Ontario is a specialty contracting firm, focused on environmental cleanup, demolition, brownfield redevelopment and groundwater treatment. The company has customers in Pennsylvania, West Virginia, Ohio and Southern Ontario but operates throughout North America, with facilities in Toronto and Winnipeg, Manitoba.
Its equipment services division designs and makes specialized equipment for its work and has developed small excavators that are run by a lithium-ion battery instead of fossil fuels. That reduces emissions, and the so-called “green machines” are also less noisy, while providing 15 hours of battery power.
The machines were tested by National Grid workers, said Dennis Elsenbeck, the utility’s vice president of business services. “The safety element is big. You have crew members talking to each other, not yelling at each other,” he said. “We deal with city streets. We deal with backyards. If it’s quiet, you’re not disrupting people.”
But the 16-year-old company can’t do any more work at its current 25,000-square-foot location at 333 Ganson St. It wants to move the new production line, as well as heavy metal fabricating and manufacturing, heavy equipment, repair services and industrial rentals and sales, to the former American Axle & Manufacturing complex.
OSC, which acquired the sprawling plant at 1001 E. Delavan Ave. for $1.5 million in 2008, plans to spend $17.54 million to renovate and upgrade a 106,000-square-foot facility in the southwestern corner of the 55-acre property. About 20,000 square feet of the building will be used for the new electric machine. The company’s office operations will stay at Ganson.
Eleven new mechanic and welder jobs will be created over two years, bringing employment to 31 and generating $753,009 in payroll. Those jobs will contribute $165,260 in sales taxes and $208,790 in property taxes over the next 10 years.
The city will separate the affected parcel from the rest of the American Axle property, which will not receive tax benefits from the project. Another firm, Galvstar Manufacturing Inc., is already operating in another building on the property, and Niagara Lubricants has signed a contract to move to another building on the site, officials said.
ECIDA directors also overwhelmingly backed $700,000 in sales tax breaks to support Calspan’s planned $10 million upgrade of its 80,000-square-foot facility at 4455 Genesee St.
In all, the aerospace and safety testing company plans to spend $4 million on renovations and $6 million on nonmanufacturing equipment. That includes installation of new HVAC systems, plumbing, boilers, roofing, security systems, windows, and computer and network infrastructure such as wiring, hardware and software. It also includes structural repairs and aesthetic upgrades.
The two-phase project entails significant work for both Calspan and a tenant, Harper International, which will occupy 36,000 square feet in the building. Harper is relocating its office and lab functions, with 75 employees, from its current location in Lancaster, and the thermal processing and advanced materials company also will add 15 jobs.
Harper, which will also keep its existing manufacturing facility with 30 jobs, had received ECIDA approval in January for tax incentives to move from Lancaster into the former Quebecor building in Cheektowaga. But negotiations broke down, so Harper withdrew the project.
The second phase of the work involves the Calspan portion of the complex, including equipment purchases and infrastructure so that the testing and technology company can better compete nationally. The 60-year-old Calspan expects to retain 90 jobs and add five.
The two firms’ 20 new jobs will generate $835,233 in direct payroll, on top of $1.5 million in construction payroll for 29 workers. The new permanent jobs will contribute $18,514 in sales taxes and $23,391 in property taxes each year; the construction jobs will support $32,790 in sales taxes and $41,428 in property taxes.
The ECIDA board also backed the sale of two small parcels of land, totaling 1.3 acres, to Permclip Products Corp. for at least the appraised value of $7,000. The parcels at 1132 Military Road and 900 Ontario St., which are already surrounded and “land-locked” by Permclip, became ECIDA property after the demolition of abandoned grain elevators.
Separately, the ECIDA will move by Sept. 30 to its new office at 95 Perry St. in the Cobblestone District, where it will share space on one floor with the New York Power Authority, Erie Canal Harbor Development Corp., Buffalo Urban Development Corp. and Arts Services Initiative of Western New York. Empire State Development will be one floor up. CBRE is marketing the agency’s Oak Street office for lease.