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TOWN OF NIAGARA – The town Industrial Development Agency this week granted a 15-year tax break to Fashion Outlets for its latest expansion, saving the mall’s owner about $6 million. The expansion will add about 50 stores to the Military Road mall.

Construction is to begin before the end of this month, said Douglas H. Morrow, vice president of development for Maceridge Co., the California company that owns the mall.

Morrow said, “We’re crossing our fingers for a good winter and hope to open in the fall of 2014.”

The company is investing well over $80 million in the project, which will turn a 526,000-square-foot, 150-store mall into a 759,000-square-foot, 200-store mall.

About 600 new jobs will be created in the stores, with 450 of them being part time, Morrow said. That will bring the total workforce at Fashion Outlets above 2,500.

There are expected to be 450 construction jobs and another 475 jobs indirectly provided among suppliers, Morrow said. A general contractor has not yet been chosen.

The expansion was Maceridge’s response to plans for two major outlet malls in Southern Ontario. Fashion Outlets’ clientele is overwhelmingly Canadian.

“If we didn’t do something, the Canadian competition is going to kill us,” Morrow said. “It’s a good thing for New York State. It’s a good thing for Niagara County.”

The project will include what Gabriele said was a $9 million cleanup of the former Sabre Park mobile home park, where most of the addition will be built. The site was a former Union Carbide Corp. dump that contained a wide assortment of buried chemicals.

Morrow said Mark Cerrone Inc. of Niagara Falls is performing the cleanup as part of site preparation.

The addition will include about 175,000 square feet of leasable space, and about 80 percent of that is already leased or under negotiation, Morrow said. The names of the new retailers will begin to be announced in the first quarter of 2014.

Gabriele said the addition will be taxed at 40 percent of full value for 15 years. He said the town IDA usually employs a sliding scale where the tax abatement gradually decreases, but Maceridge wanted a constant figure because the expense will be rolled into the retailers’ lease payments.

Also, Maceridge receives a 15-year exemption from paying sales taxes on building materials, equipment or furnishings for the addition, and it won’t have to pay mortgage recording taxes.

Maceridge said the company’s $6 million in savings is the same with the fixed payment as it would have been with a sliding scale.

Maceridge also will increase its payments under a host community agreement. Gabriele said the mall owners now pay $200,000 a year directly to the town and $50,000 that is donated to charitable organizations in the town.

The IDA attorney said a $100,000 increase in the direct town payment is expected. Morrow said that agreement is “to be worked out over the next several months.”

email: tprohaska@buffnews.com