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We hear threats all the time from businesses wanting tax incentives from government. They threaten to move out of town. They threaten to not spend money on improvements. They threaten to close up shop.

Wilmorite, owner of Greece Ridge Mall, threatened to walk away from a redevelopment project if it didn’t get a PILOT agreement. The $12 million to $14 million project involved tearing down the Bon-Ton and replacing it with nice restaurants. The County of Monroe Industrial Development Agency said Wilmorite needed the PILOT to get bank financing.

Worried the mall would deteriorate, a tentative deal was reached among the town, county and school district.

Was the threat real?

A government official who didn’t want me to use his name said yes. One need only look at Irondequoit Mall, now named Medley Centre. Wilmorite built the mall and when it declined, gave up and sold it. The mall is still awaiting redevelopment. One could say Wilmorite gave up on Sibley, though that’s a bit more complicated.

Judy Seil, head of COMIDA, doesn’t like calling the Greece Ridge incentive plan a “tax break.” She said the mall is reducing its square footage by knocking down the BonTon, so it’s actually not taking advantage of what would likely have been a property tax reduction. I’m skeptical of that explanation, because if this wasn’t a tax break, why would Wilmorite need it in the first place?

Aside from serious questions about whether tax breaks for retail projects are wise, this entire episode begs other questions about malls in general and Greece Ridge in particular. America is discovering it built too many malls. People are shopping more on the Internet. In Rochester, we knocked down Midtown. Medley is almost empty. What’s the long term plan for Greece Ridge? Will restaurants keep it afloat or will it need more taxpayer support in the future?

26 Responses to Wilmorite’s Threat

  1. July 17, 2012 at 4:56 pm Ben Campanelli responds:

    pick a dead mall, any dead mall by state @

    deadmalls.com

  2. July 17, 2012 at 5:18 pm Ginny B responds:

    I still think PILOTs for retail and restaurants are terrible policy, but I am glad the school district stood up to this threat, if only a little.

    • July 17, 2012 at 5:20 pm Ginny B responds:

      Or, as I meant to add…this is evidence that principled opposition leads to an improvement in public policy. Taxpayers need to help these elective officials make the right decisions by standing up for equity.

  3. July 17, 2012 at 5:27 pm theodore kumlander responds:

    this is why i moved to ontario county 8 years ago. taxs are to high in monroe county and they give to many tax breaks to to many profitable bussines.

    • July 17, 2012 at 8:25 pm James Simons responds:

      You do know that Ontario County gave tax breaks to Wilmorite for the Eastview expansions right?

  4. will restaurants already established in greece qualify for PILOT due to loss of business to PILOT restaurants in the mall…greece has plenty of restuarants…locally owned…why do we promote out of town folks over our own? Shame on Monroe County and the town of Greece…their loyalty is so misplaced.

  5. Wilmorite corp is a billion dollar company the threat is just so they donot have to use their money, I f theywere losing money they would have ulled the same crap as they did with sibley building

  6. July 17, 2012 at 8:21 pm Dave Garretson responds:

    Local government has no control over whether the mall dies or thrives, nor should they. Success of the mall is the 24/7 concern of its owner. If the developer believes additional investment in makes sense, they’ll invest. If they think it’s hopeless, they’ll sell. Delivering an ultimatum was an opportunity to milk more money from a business decision they’d already made. In this case, the school district objected loudly and the developer agreed (seemingly) to a greatly reduced tax break. Bottom line — the mall is a money-maker and they don’t really plan to walk away from it. If the school district hadn’t called their bluff, the developer would’ve pocketed millions and taxpayers would be left holding the bag.

  7. Agreed Dave. They also gave Bryant and Stratton a deal too.

  8. Regarding “Wilmorite’s Threat”: okay, I’ll take the opposing view (since my grandfather, his brothers, my father, and my uncle built this company from nothing, over 60 years ago). While I am no longer a part owner of Wilmorite, or any of its subsidiary companies, I am, understandably loyal to my family, and thus obliged to present the other side of this argument.

    Briefly: No school district, town board, city council, or IDA is required to grant the wishes of any developer, manufacturer, or other business operator. The examples of the Sibley Bldg. (RochWil), Medley Center (Iron. Mall) and Greece Ridge Center Mall are easy targets, for the uninformed.

    I challenge Rachel, or any of her readers, to find major employers in the U.S. that do not solicit, and typically garner tax breaks in order to operate successful businesses, that employ real human beings. And if you dislike this particular process in this country, in this community, try wading through the graft and corruption of most other nations.

    Finally, only an idiot would attempt to own/run a business without looking at all cost sectors, before determining whether to move forward on a project, or not. The fact is government is a quite willing partner in making sure that malls like Greece Ridge Center do not slowly empty themselves of retailers and restaurants.

    If the average person reading this article/comment could build a mall or plaza, perhaps they would. But let’s face it: Very few have the talent, intelligence, or moxie to wade through the myriad zoning issues, bank financing, construction period, leasing negotiations, and mall operation to pull something off as difficult as the building of a mall. That doesn’t make developers or business owners better people than anyone else: It simply means that someone has to build the structures that consumers seem to still desire.

    Thank you!

    Christopher J. Wilmot
    Pittsford, NY

    • Mr. Wilmot,

      Your defense of your family’s business is an embarassing mix of nonsense and special pleading that misrepresents the motives those ciritical of tax breaks and corporate welfare for retail while failing to rebut their arguments.

      I understand the complexities and difficulties of financing and running a business. I want businesses to succeed. My livelihood is dependent on businesses succeeding and repaying the financing I help them obtain. And I understand why Wilmorite wants to lower their taxes and guarantee their future costs. Everyone does. I want to drive with fewer stop signs and no unexpected delays. Would it be fair for the government to build me a special road with right of way that makes you stop for me? Inconveniencing you for my personal benefit? It’s just as unfair for other businesses that don’t have Wlmorite’s clout and connections to pay more taxes and have to compete on a tilted playing field. Would it be fair for the government to regulate the rent the malls can charge locally owned businesses in the name of giving small businesses a break? No. I have observed several clients negotiating leases with Wilmorite and I can assure you that when it comes to their tenants they are committed free market capitalists regarding their income. They shouldn’t get to turn around and become socialists when it comes to their expenses.

      What I want is lower taxes for everyone with a commitment to restraining spending growth and regulations to enhance the economic climate for everyone. Not keeping the same broken high cost, high regulation system and adding more cost and complexity for the majority of business owners by giving special breaks to a few politically connected businesses like Wilmorite.

      Finally – yes America is better than most countries and open, documented bribery and tax breaks are better than what goes on in Third World dictatorships. That doesn’t mean it’s right or can’t be approved. I hold the U.S. to a higher standard and I’m sorry to hear that a former elected official doesn’t.

  9. Wilmorite has been holding Monroe county hostage for years. Why should our tac dollars be giving multimillionaires breaks. So much for a since of community.

  10. July 18, 2012 at 6:40 am lynn e responds:

    The plan is for 5 restaurants so how many does the community need in one spot? The mall is already home to Greece central school district’s Bridges program where kids put into GED programs and long term suspension kids attend tutoring. So that indicates mall space that wasn’t needed for store space. DMV is there too. Good indications of a mall that is dying and not as popular as before. Greece Town Mall was already dying when Long Ridge combined with it and the good times didn’t last all that long. The most popular thing is the movie theater. It just won’t last.

  11. lynn e: Imagine slamming in 5 more restaurants in a town that has to have less discretionary earnings due to the evaporation of Kodak salaries and wages and the trickledown effect into other Kodak related support job losses.

    Imagine if you owned a place like Golden Ponds up the road from the Mall on Long Pond and you hear this giant sucking sound. Think the town or C.O.M.I.D.A. will cut them a deal to expand and save jobs?

    Malls are a shakey proposition due to the discounting of America. Just take a spin further west of the Mall on the Ridge and you’ll see what the discounting of America has brought – stand alone discount box stores and modern strip malls unwilling to share common doors with others to dilute a customer base tied to their strong brand and the excitement of getting a price break on cheap Chinese goods.

    That’s where we’re at, less money, less profit margin, less quality. The old enclosed retail mall just doesn’t fit that reality anymore, except maybe for ther affluent who have to dress-down and wear large sunglasses when they shop at the discount box stores:

    The Vanishing Shopping Mall – The Week March 26, 2009.

    So, why not invest our money in malls when you live in a cocooned parallel universe?

  12. July 18, 2012 at 7:56 am Ginny B responds:

    Mr. Wilmorite,

    The problem with your argument that “everybody does it” is that these special property tax breaks are not availlable to every business owner in an equitable manner. I doubt that COMIDA has negotiated PILOT deals with any owner of a diner or independent restaurant – and even if they have, it would have been their standard deal, 10 years during which the property tax bill increases gradually so that by the end of the decade, they are paying full taxes on the full assessment. I don’t necessarily oppose these deals, as long as they are available to everyone.

    However, what COMIDA does is provide tax relief to large, and let’s face it, politically well connected developers who will compete directly for market share with small business owners paying full taxes. Essentially, home owners are asked to shoulder a larger portion of the tax bill in order to give one developer in their community a competitive advantage over smaller business owners. Especially when we are talking about restaurants or retail. This is basically a zero sum game in which traffic moving to the new restaurants diminishes traffic at the established ones, especially in a community that it not growing. This is not creating new jobs, it’s just shifting them from one place to the other. I’m not uneducated. I’ve actually read these studies.

    And with all due respect to your grandfather, please spare us the argument that developers are just that much smarter and hard-working than the rest of us. If that were the case, they’d develop business plans that didn’t rely on selfishly shifting their property tax responsibilities to others. Somehow, all the other restaurant owners on Ridge Road in Greece have managed to do so. And you do Wilmorite up for criticism on this point – if the principles there are so good at this, how do you explain the bad decisions to invest in the Irondequoit Mall and the Sibley building, neither of which have made it despite multiple government subsidies? Why did COMIDA commit to a 25 year tax abatement to a company with a proven record of failure?

    • GB: talkin’ to the Mall’s Wall here.

      What’s the difference between a mall going belly up and Kodak? Did not Kodak ask for lower assessments in Greece and the City? Did they not demolish defunct facilities to reduce tax burden? Same for Webster re Xerox.

      What happened to the crass harshness of raw Darwinian capitalism? Instead what you get is an arguement that mimics why folks climb Mt. Everest: because it’s there.

      How slick can you get: we take public subsidies from laid-off Kodak homeowners because they’re there.

      Isn’t that like saying I came up from Georgia to NYS to get welfare because it’s there. Who wouldn’t check out all the economic angles before making a business decision like that?

  13. July 18, 2012 at 9:18 am Pete Tonery responds:

    Oh God, Chris Wilmot has once again dragged out all the tired old excuses and mythologies to defend what is clearly a SOP tax rip off.
    Thanks Ginny for pointing out one fallacy of Wilmot’s argument: the “Two Wrongs Make a Right.” Just because everybody is doing it doesn’t make it good, right or admirable. And a GREAT point about fairness.
    And this is the central issue in discussion about COMIDA and tax grants to business. They are both legal and immoral. The dedicated capitalist dismisses questions of morality appealing to a high power, the god of the Free Market, as justification. They argue that the rules of the marketplace tie their hands when it comes to soaking the taxpayer. Wilmot says, “only an idiot would attempt to own/run a business without looking at all cost sectors.” More plainly, “Only an idiot would skip trying to screw the taxpayer.” I know you are articulate Chris, don’t be afraid to say it precisely.
    This gets us to the heart of the matter: the despicable quid pro quo that exists between the Monroe County Republican Party/COMIDA and the power to influence legislation that heavy campaign funding delivers. Any perusal of the top donors to the MCRC has construction companies and developers at the top of the list. It’s been this way for decades, and became an institution under Jack Doyle.
    If a law exists that encumbers a corporation’s “freedom” to soak the public, or one is needed, then careful and generous campaign financing that results in the election of your champion will eventually remedy that. Corporations, if they are people as they aspire to be, are sociopaths in the mold of Tony Soprano. Morality is shapeable to their personal gains; laws are to be ignored or warped as they apply to personal wealth and power. Later, devise a shabby illogical “argument” to justify the behaviors.
    My favorite part of Mr. Wilmot’s claims however is his summoning up of the ghosts of his pioneer ancestors. He raises the specter of John Gault, resplendent in deco suit, poised like a Soviet statue, staring confidently into the onrushing future. “If the average person reading this article/comment could build a mall or plaza, perhaps they would. But let’s face it: Very few have the talent, intelligence, or moxie to wade through the myriad zoning issues, bank financing, construction period, leasing negotiations, and mall operation to pull something off as difficult as the building of a mall.” Sheesh! Chris, read Michael Lewis’s commencement speech to Princeton grads from June. Yeah, yeah, your family built Wilmorite but it’s not like they had to survive a winter up in Donner Pass (wading through the myriad zoning issues!) They succeeded with a lot of luck, political financing and immoral soaking of taxpayers…a tradition that continues today.

    • July 19, 2012 at 10:24 am Orielly responds:

      Nice to bring the Republicans in on it. DO some, just a little bit of research and you will find the Wilmots are DEMS… major Democrats. They fund Democrats.

      Two family members ran for local offices as DEMs.

      On a small scale a retail business, the owner renting from a landlord has to cover the tax on the property. We see lots of small retail business go out of business. Look at the villages of Pittsford or Fairport. Many people think its because of poor business ideas/management. Truth is that in many cases the business can’t support the rent due to the high taxes and mis-guided (greedy) land lords.
      A 2000 per month rent (with triple net)
      means a retailer has to do 8000 a month to break even. Do the math thats hard to do selling most items.

      The Wilmots want the tax break to reduce their costs. That reduction will not find its way to the renter.

      College town and the UR is a worse example. They get tax breaks, free city land, are a non-profit and work it all through a Cleveland developer. But they (UR) want more of our tax dollars for their private school every year.

      Get rid of it all. No tax breaks for malls none for Non-Profits. Make Universities pay taxes on profits and property. Church’s get one church building tax free. The pastor has to pay property tax on his house, so too the UR and RIT president.

      You want tax reform start there. If they threaten to leave let them. Its a free market and someone will figure it out and open a business, where they left one.

      • Oreilly, you know your poops.

        Only major nationally branded, high margin retail businesses can afford space in malls. Mom & pop local brand retails, what’s left of them, need not apply.

        The triple net formula can not be afforded by the low-margined, high volume discount box stores, so they go to stand-alone parcels where they need not share their loyal cutomer base with anyone else.

        The replacement of shakey retail space with faux neighborhood facaded eateries might work for a while untill they start banning quarter-pounders, salty chemically- tenderized steaks and sulfide-sprayed salad bars.

        • July 19, 2012 at 1:21 pm Orielly responds:

          Yes I would like to know why the BonTon going out of business in this ares, means we, the taxpayer, have to give a 30 yr tax break to Wilmots to develop that space?

          If they want to develop it go for it. If they want to leave it and pay the current tax on it good. If they want to abandon it all, they can do that too.

          It’s far cheaper for the Town of Greece to knock down the Mall and put the property up for sale, and sell it, than give tax breaks for 30yrs.

          Let them walk away. There are a lot of other pretty girls at the dance who would buy that property.

  14. PT: And they wonder why there’s an Occupy Movement afoot in Rochester.

  15. July 18, 2012 at 10:04 am Peking Humonculous responds:

    Wilmot’s response here is just as out of touch as I expected. Of course, someone who comes from that kind of wealth can’t understand how or why us plebians don’t like seeing the rich in our area score tax break after tax break while those of us who pay taxes are left holding the bag. They’ve already ruined their reputation after what they did with the Sibley building (in everyone’s but COMIDA’s eyes, obviously) and now he offers excuses and put-downs because we taxpayers simply are too dumb to understand how big business works. We know how big business works, Mr. Wilmot. You have the money which gives you a voice and we don’t. Excuse me if I think that’s B.S.

    • Peking: been around here long? What comes to mind when you think about the Genesee X-Roads urban renewal project developed back in the 1960’s?

      And, here’s a take from the recent the left-leaning Atlantic Cities – Place Matters – Mark Byrnes – Jan 24, 2012, on our current state of economic affairs in our post-Kodak solvency era:

      Rochester, New York: Then and Now, Through Video (1963 to 2012)

      Gotta stop listening to those ROC Alliance folks on Sunday morning WHAM Radio:

      “It’s a recession if it affects someone else. It’s a depression if it affects you.”

  16. July 18, 2012 at 11:23 am Peking Humonculous responds:

    I wasn’t even born yet in the 60s and I don’t listen to WHAM so your point is unclear to me.

  17. In response to Mr. Chris Wilmot – the reality of your statement – “Very few have the talent, intelligence, or moxie to wade through the myriad zoning issues, bank financing, construction period, leasing negotiations, and mall operation to pull something off as difficult as the building of a mall.”
    Did you hear about the inner city kids in west philly that built a car for the project X contest? Some of these kids were at the bottom of their class in a inner city school environment. Although they didn’t win, they beat out some of the wealthy corporations that were in it to win the $10 million dollar prize (and subsequent business deals) – so much for your “talent, intelligence, or moxie”. Is it just possible they didn’t get the opportunities you did? Another classic case of the sense of entitlement. If they are not making the money they want – then leave! I live in greece and would welcome the idea of that company leaving. I hope they do us all a favor and go. OR – perhaps they could influence the federal government to outlaw the internet also – that would certainly help their sales. Even your family that founded that company would be stunned at the perks companies like that are receiving from the government. As far as your “very few who have the talent…..” you imply that the pay just isn’t enough for their specialist skills or whatever – maybe they should find another profession. Companies like that will threaten our city, state, and federal governments with leaving each time they no longer like their margins – but they don’t have the stones to admit it to their own customer base.

    PS – Why don’t you tell wilmorite to leave the place the way they found it before they leave – us taxpayers don’t want to “fit the bill” for the mess they leave behind on the way out.

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