County IDA to set hearing on Great Lakes Cheese plant application

Proposed site for a $500 million Great Lakes Cheese Co. plant along Route 16 in the towns of Franklinville and Farmersville. The Cattaraugus County IDA will vote on setting a public hearing for the project today.

ELLICOTTVILLE — Local development officials are expected to move forward on an application for tax breaks for Great Lakes Cheese Co.’s proposed $500 million cheese plant in Franklinville.

The Cattaraugus County IDA board is set to meet at at 11:15 a.m. at its Ellicottville offices to vote on setting a public hearing for tax breaks for the proposed project.

The proposed 486,000 square-foot state-of-the-art cheese plant would replace the current cheese plant in Cuba, which is said to be near the end of its useful life with limited room for expansion due to terrain at the site.

The new cheese plant would employ the 230 currently working at the Cuba plant plus an additional 200. Great Lakes Cheese worked with the Allegany County Industrial Development Agency for two years before pulling the plug on a proposed site in the towns of Amity and Angelica.

The 200-acre Franklinville-Farmersville site is about 16 miles from the Cuba plant, officials said. The company wants to retain its current employees and maintain and expand Southern Tier milk purchases.

The Cattaraugus County site is in competition with a site in Genesee County.

A proposed payment in lieu of taxes agreement, which deviates from the IDA’s normal abatements, calls for waiving property taxes for 20 years. In year 21, the exemption would be 70% and end at 30% exemption in year 25 — with the site seeing a full tax assessment 26 years after completion.

The sales tax exemption is estimated at $23 million, the mortgage recording fee exemption about $5.6 million and the PILOT about $125 million over 25 years. The IDA’s normal 25-year PILOT, has a 100% exemption for 15 years. The deviation will be the subject of a public hearing.

In a letter to county, town and school officials, the IDA said total tax exemptions would total $153 million, while producing about $350 million a year in economic benefits.

The company would continue to pay the current taxes levied on the vacant land over the term of the PILOT. Special districts like fire districts, which are not bound by the PILOT, will receive tax revenue based on the property plus the improvements.

Average salary for plant workers is about $52,000 plus benefits. There will be a more than a dozen firms and 500 construction workers building the plant. In addition, company officials claim hundreds more jobs will be created for the regional production supply chain.

IDA Executive Director Corey Wiktor credits a Freedom farmer with going to Great Lakes Cheese Co., with the offer of selling his 200 acres along Route 16 in the towns of Franklinville and Farmersville after he saw the Allegany County cheese plant site deal fall through.

In June, the Cattaraugus County Legislature voted to provide $150,000 to the IDA for site studies now underway to encourage Great Lakes Cheese to select the site.

Wiktor said the inducements will keep the Cattaraugus County project competitive. The incentives need to recognize this. Great Lakes Cheese will probably pay $20 million to extend utilities into the site, Wiktor added.

“The loss of this plant to the region would be too great,” Wiktor said. “The impact of the payback will outweigh the incentives.”

(Contact reporter Rick Miller at rmiller@oleantimesherald.com. Follow him on Twitter, @RMillerOTH)

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