Nano Deal Evaporates
Citing "misinformation in the media" that led to a "misunderstanding of the intent of the application," the Albany College of Nanoscale Science and Engineering withdrew its application to the Albany County Industrial Development Agency for financing for a new building at the Washington Avenue complex.
The under-construction $200 million ZEN building will house renewable energy and clean-tech research. It is designed to operate as a zero-energy building — or ZEN — that generates its own power. Although located in the Albany city limits, it will generate zero tax dollars.
The nano college intended to use Albany's economic development arm, the Capital Resource Corporation, to borrow money to fund the ZEN building.
Times Union reporter Jordan Carleo-Evangelist explains CNSE would use the city as a middleman to get access to $186 million in low-interest bonds to foot the bill for construction. "The city, being the middleman, can extract a 'we help you out fee' of 1 percent, which on this project, added up to almost $1.9 million."
The project had been in the works for months. "If there was a controversial element to it, it was that the nanocollege was also asking for a exemption from mortgage tax, which is $23 million on this loan."
The process was moving along as expected until last week, when CRC's finance committee was ready to send a positive recommendation endorsing the deal on to the full board. "One of the board members, Dominick Calsolaro, had raised questions about the potential reduction in the fee that the nano college would pay the city. That potential reduction to about $1.4 million, sort of set off this whole chain of events that eventually blew the deal up."
Calsolaro has no problem with the not-for-profit nanoschool. But he has questions, as well as concerns. "The issue is the for-profit businesses that locate in nano-tech buildings and don't pay taxes." He gave an example: a commercial barbershop renting space in a church would be expected to pay taxes. He applies that logic to nanotech: "Why do we have these multi-billion dollar for-profit corporations there, making money, using not-for-profit buildings, using Albany police services, Albany fire services, Albany EMS services, and not paying the city one thin dime in property taxes."
When push came to shove, CNSE spokesman Jerry Gretzinger emailed the media early Saturday morning, announcing the ZEN funding application had been withdrawn.
Carleo-Evangelist reports Tuesday that Mayor Kathy Sheehan, who was unavailable to speak with WAMC Tuesday, hopes to "resuscitate the deal." CNSE's Gretzinger casts doubt. "We look at what's gone on as water under the bridge at this point. We are moving on, we are moving forward. We don't have any issue with the city or the mayor or the county executive, they've always been very supportive of everything we do."
Gretzinger says the nanocollege remains committed to pursuing opportunities beneficial for city and county, and adds construction of the ZEN building will spur significant economic development in the region and is scheduled for completion in 2015.