ECONOMIC RE-DEVELOPMENT AT EPCAL -- AN INTRODUCTION Jan 28. 2013 | Comments (0)
The engineering consultants, VHB, hired by Riverhead Town seem to suggest a desire to replicate the blueprint for economic development used at Fort Devens, Massachusetts.
Riverhead needs to look at this in a local historical and geographical context. What does Fort Devens have in common with the former Grumman site in Calverton, NY? Nothing. Fort Devens is a former Army Base that housed an overflow of university students in the 1950’s. Fast forward to 1991, Fort Devens was used as a deployment center for Operation Desert Storm and Shield. Once it was shut down by the military, the Massachusetts Development Finance Agency took over.
Fort Devens had a large residential housing component; Grumman does not. The base had existing infrastructure, roads, water, electric, mass transit, retail centers, commercial buildings, schools and park/play areas where Grumman lacks most. In 1996 Massachusetts Development Agency paid the state $17MM for the 4400 acre site. The agency attracted Bristol-Myers Squibb who started to manufacture arthritis medicine there. According to Bristol-Myers Squibb’s website, they invested there because of “the existing infrastructure, the tax incentives and the educated workforce.” The state gave them an estimated $60MM in total incentives to date. VHB was the engineering consultant group that oversaw this project.
What makes Fort Devens a unique community is its location, just 35 miles northwest of Boston. Boston and Cambridge, home to Harvard and MIT, are metropolitan areas with extensive commuter bedroom suburbs that draw the nation’s best and brightest talent. There is a rich cultural and social diversity that boosts its economy and creates technical innovation.
So back to the East End of Long Island where …. Southampton College couldn’t stay open and the Stony Brook Incubator located at EpCal is half empty. Many of the arts and cultural venues (and restaurants) shut down for five months out of the year. The East End has an enormous retiree and senior community and a disappearing younger work-force. American global multi-international corporations are outsourcing jobs, people, production, merchandising and sales to India, China, and Romania.
So while our national deficient is teetering towards default, our shuttle programs are shutting down, our military is scaling back and the future is becoming more virtual and viral – we believe we can bring Biotechnology, Defense Contractors and Manufacturing out to the former Grumman site?
In the past three years, there have been very few start-up companies on Long Island primarily because of the inability to obtain bank or equity loans. Even established companies have a difficult time getting new credit and new ones have no incentive to transfer here due to corporate and personal tax rates. Demand for high-technology jobs greatly diminished with the shut-down of the defense industry in the 1990s. This, in stark contrast to the late 1980’s, when Long Island industry was 33% dependent on the defense industry for its high-tech jobs. With the transition of business in the last twenty years, we now have a diversified economy where no single industry makes up more than 3% of our total economy.
In 1998, EPCAL (Enterprise Park at Calverton ) was transferred from the US Navy to the Town of Riverhead for the sole purpose of economic redevelopment not as a real estate pawn. The federal disposition of property process includes the Comprehensive Reuse Plan which was conducted in 1999 over 18 months of extensive participation and input from regional agencies, environmental groups, Long Island Association (LIA), LIPA/Keyspan and Verizon. The plan was a mix of industrial and recreational uses and was formalized by the Town of Riverhead’s adoption of new zoning districts. The reason the plan incorporated this mix of industrial, commercial, recreational and open space uses was to replace the 3000 jobs and $1,000,000 in annual property tax revenues generated during Grumman’s tenure for the town and eastern Suffolk region.
Later, the Town sold a 500 acre portion of the site to an industrial developer, Jan Burman, in 2001. The property was then subdivided and sold to approximately 30 manufacturers and distributors. Jobs at the site currently exceed 700 and real estate taxes generated roughly $2.5 million dollars per year.
In 2010, Rechler Equities submitted a revised plan for a 300 acre industrial park that had been under contract with the Town that included a mixture of workforce housing and accessory retail for the park. The Riverhead Town Board rejected the proposal because they didn’t want any residential component. Ironically, a recent recommendation of VHB proposed exactly that same zoning mixture aligning it with the Fort Devens plan.
Rechler went to Gabreski Airport and now, several years into the Hamptons Business District, they have one tenant, Hampton Jitney, who has a bus stop there. I know this because I worked with Mitchell and Gregg on the project.
Under the forthcoming plan outlined by VHB, and Walter’s new Industrial Sub-Division Map, residents of Riverhead Town will have to wait for the next 5-7 year cycle before we see anything new at Epcal in terms of commercial/industrial growth.
Riverhead has a golden opportunity right now with the Calverton Horse Park and Stadium. The Neuss Fund and International Polo Organization (IPO) will create an Equestrian Village grounded by a 10,000 seat stadium, a surround hotel, spa, retail spaces, restaurants, cafes, gardens, riding trails, steeplechase course, polo fields, jumping arenas, dressage rings, and stables. The equestrian events are only a part of the overall activities at the Village.
The stadium will be used in the off-season for local events, concerts, trade shows, conventions, and other sports including soccer and lacrosse. Neuss Fund and IPO do not need financing, bank loans or outside investors. They have offered $38MM to Riverhead Town. They have offered to give discounted tickets, parking, memberships to the stadium for events, restaurants and shopping for residents of Riverhead.
Most importantly, IPO is not asking for any IDA tax breaks or incentives. They are open to profit-sharing with the Town or a Gate Tax payable to the Town. There is no negative burden on the school districts at all.
The Horse Park is a completely green, eco-friendly project that will work in concert with the DEC and the local environmental groups for a clean, sustainable habitat.
The project will create a variety of seasonal and year-round jobs that range from labor to management level positions. (A preliminary roster is attached.)
There will be an Equine Veterinary Clinic and Surgical Center offering horses and large animals on the East End the very best in state-of-the-art vet technology and care. There will be a Sports Rehabilitation & Therapy Center within the spa.
The American Horse Council in Washington, D.C. and the private accounting firm of Deloitte conducted a report on the Economic Impact of the New York State Horse Industry. Total amount of revenue generated exclusively from horse sports for the State of New York is $2.4 billion a year, of which $418 million is produced from Polo and $400 million from Show Jumping. In annual taxes, the industry generates $124 million of which $88 million is paid to the state and $13 million to local government.
The employment figures are equally impressive. Roughly 152,000 New Yorkers are directly employed in horse-related jobs.
It’s not just the super-rich who own horses and play polo … in NYS only 8% of horse owners have a Household Income of $150,000+ while 23% of horse owners have a Household Income between $50,000-74,999. So you can see that the appeal of the industry does indeed trickle down to regular folks.