Yahoo to Reward Buffalo Foundation For Niagara County Tax Breaks

Credit is due: Richard Updegrove was the only Niagara County elected official to challenge the Buffalo/Albany grab of Yahoo gift.

Last week Niagara County Legislature Majority Leader Rick Updegrove questioned the contribution of $3.5 million by Yahoo to the Community Foundation of Greater Buffalo as part of Yahoo's incentive package to expand the company's data center in Lockport.

Updegrove made it clear that he had no problem with requiring Yahoo to donate to the community. After all, Yahoo is receiving an 18-year property and sales tax break for their $169 million Lockport expansion.

But Updegrove questioned the deal that requires Yahoo to send the $3.5 million to a Buffalo non-profit when it was Niagara County and the Town of Lockport that provided the bulk of the incentives provided to Yahoo.

The plan, misleadingly called the "Community Benefit Agreement," directs all the money to the Community Foundation for Greater Buffalo and - and this is interesting - is "subject to review and approval by ESD (Empire State Development) and NYPA (New York Power State Authority)."

In other words, Yahoo gives $500,000 a year to a Buffalo Foundation and two state agencies under the thumb of the governor, will decide where it goes.

This distorted mechanism for the distribution of the funds is so questionable that it appears to some observers to be little more than an Empire State Development slush fund to throw some money around through its Buffalo political connections without oversight or transparency.

In essence, the Community Foundation for Greater Buffalo will act as a laundering agent for the ESD, critics say.

The community benefits concept is a mere joke orchestrated by ESD political operatives, according to those same critics.

Niagara County and the Town of Lockport made the local site attractive enough to Yahoo to locate its worldwide data center in this community and if there was a local benefit payment, it should have been used in this town and in Niagara County Updegrove argued.

While it is true that the New York Power Authority contributed a small amount of low-cost power to Yahoo, it is not justification enough to take the comparatively small community benefit contribution Yahoo will make out of Niagara County. It's not as if NYPA stepped up with an incentive that's depriving another county or company. It's using our low cost power, which we see very little of, for a business in Niagara County, according to several observers.

Niagara hydropower is the source of most of NYPA's profits, while the people in Niagara County pay almost the highest electrical rates in America. Most of the hydropower generated at the Lewiston power plant heads to New York City, via Albany.

Meantime, the governor has set his heavy hand on the Yahoo deal, and Niagara County and the Town of Lockport, while playing host to Yahoo, will act in large part a little like a whore prise under the management of a pimp. Kind of like the state helped itself to a heaping helping of hospitality in the suite deal with the Buffalo Bills. Niagara County puts out and Albany takes the money.

While having the diplomacy to articulate his appreciation of the value of having an organization like Yahoo coming here, Updegrove should be commended for calling the state out on giving away our assets while taking the benefits under their control.

Meantime, like the old joke about whores, Niagara County remains flat on her back.