BUFFALO, N.Y. (WKBW) - Occupy Buffalo Protesters are rallying against the Erie County Industrial Development Agency approval of $212 thousand in sales and mortgage tax cuts to aid in the renovation of the Graystone Hotel on South Johnson Park. It's a building owned by private developer Carl Paladino and his company Ellicott Development Corporation.
"The Ellicott Development Corporation has a net worth in the billions and they can afford to spend five million dollars to this? They won't do it unless we give them tax money to subsidize Carl Paladino," Protester David Gears said.
Paladino said that's not how it works.
"The building pays a low tax base, based on its value which is almost nothing. We're not getting something from the government. We're going to improve a piece of property and we're asking that would otherwise be taxes in the future based on its value when it's finished that those taxes be deferred for 10 years so that money can be used for debt service to cover improvements to the property," Paladino said.
The protesters also are upset that with the tax break, the 42 apartments going into the building will be for middle to high-income tenants. There will not be low-income housing provided. In addition to the ECIDA tax reduction, this project is also part of a pending Historic Tax Credit because the Graystone is on the National Historic registry. It is not required to have low-income housing options with that particular tax credit.
During the meeting Mayor Byron Brown voted for the measure, eager to fix up the building he calls an eyesore in the community.
"I thought it was important to support this project to support downtown and support the entire community where we are building a range of housing for low, moderate and high income," Mayor Brown said.
Even with the vote, the project is still not a go. Paladino is waiting on the Historic Tax Credit to be approved.
Erie County Executive Mark Poloncarz said he had mixed feelings about the vote but ultimately decided against it.
"If they don't get a historic tax credit for this we may as well tear it down and do a new build," Poloncarz said.
A decision regarding the historic tax credit should be made within two months and Paladino hopes to start the project by July.