AMSTERDAM -- The $34 million Chalmers Mill Lofts apartment project passed another milestone, an indication developers say keeps the plan on schedule.
KCG Development and DEW Ventures, of Saratoga Springs, submitted their application for federal tax credits and gap loan funding from the state Division of Housing and Community Renewal on Wednesday.
"We are locked and loaded," said Bill Teator, of DEW Ventures.
The Chalmers project's application details a 30-year payment-in-lieu-of-taxes agreement for the 120-unit apartment building, restaurant and banquet hall. The PILOT has now been approved by all three taxing jurisdictions affected by the project, located at a former knitting mill site.
The Amsterdam Common Council and the Montgomery County Legislature both unanimously approved the PILOT. On Wednesday night, the Greater Amsterdam School Board gave it the greenlight, with only school board member Gavin Murdoch voting against it. The Montgomery County Industrial Development Agency is expected to grant the final approval on Jan. 10.
"All of that support for the 30-year PILOT is exactly what the state likes to see," Teator said. "Having public, private, local, state, federal support — this is how these projects get done."
The PILOT estimates the three municipalities will collect approximately $2.97 million over the 30-year term of the agreement. In the first year, the project would pay $30,655, with about 44 percent of that going to the school district and the rest split between the city and county.
The amount increases to $59,963 in the second year. It would subsequently increase gradually every year until reaching approximately $149,912 in the final year of the 30-year deal. Those estimates are based on the current tax rates and the current median income levels, which will control rents for about 95 of the new apartment units.
If median incomes rise, rents can rise with them, increasing the revenue to the building and increasing the taxes paid. The split between the municipalities could also vary, depending on tax rate changes between the three municipalities.
In October, the Amsterdam Common Council passed a five-month extension for the purchase agreement between the city and KCG Development and DEW Ventures, after the discovery of 15-foot-deep area of oil contamination on the parcel. The purchase agreement requires the city to sell the 3.3-acre property on the south side of Amsterdam for $300,000.
KCG and DEW Ventures were required to deposit $30,000 in an escrow account as part of the purchase option. The city waived an extension fee in light of the cleanup costs.
Teator said the developers have spent "a couple of hundred thousand dollars" at the site so far, but he did not have an exact figure on the cleanup costs. He said the developers hired engineering firm C.T. Male, which was the firm the city originally hired to do a surface remediation of the site, to extract the contaminated soil, seal it in drums and remove it from the parcel.
"We had been incurring costs for what was really the city's cleanup agreement -- and the city's dirt -- to comply with the brownfields cleanup protocol. So, the city agreed to extend the purchase agreement," Teator said. "The costs to us greatly exceeded what the fee would have been for the extension agreement."
The Chalmers project has also received a boost from a $150,000 state grant awarded last week as part of the New York State Regional Economic Development Council awards. The grant is earmarked for a waterfront boardwalk and community space near where the apartment building will be built.
"The grant won't be used for the residential or commercial project. But there is a 40-foot easement on the site from the flood wall, and along that ... will be very intentionally, publicly-available space that will really add to the space available on the (Mohawk Valley Gateway Overlook pedestrian bridge)," Teator said.
Another integral aspect of the project has been the Lanzi's Southside restaurant, to be leased by the Lanzi Brothers, a family business that operates multiple restaurants in Fulton County.
Company owner Luigi Lanzi said his family is excited about the project and provided input with the inclusion of a rooftop deck over the restaurant as part of the design.
"Our thinking is, the sooner we get going, the better," Luigi Lanzi said. "It's going to be a neat place."
Teator said project principals expect to know by April if the project has been approved for the tax credits and gap funding it needs.