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Council Approves Jamestown Brewing Company Loan Extension

The Jamestown Brewing Company is pictured on the corner of West Third and Washington streets. P-J photo by Dennis Phillips

Despite opposition from one member of the Jamestown City Council, a loan extension has been granted to the Jamestown Brewing Company.

On Monday, prior to the council voting to revise the terms of the $180,000 Jamestown Local Development Corporation loan to the developers of the Jamestown Brewing Company, Andrew Liuzzo, At-Large councilman, said a regular private business person would be given the same loan extension the council approved. He said because the project is being subsidized, the developers – Jon McLellan and Jon McLellan II — are being given additional assistance.

Vince DeJoy, city development director, said the extension of the JLDC loan is “somewhat routine” and the developers are receiving the same type of assistance from the commercial Five Star Bank. He said the JLDC loan is not from taxpayer money, but is from urban development grants city officials received in the 1970s and 1980s, which was transformed into a loan fund to help businesses in the city. He added that interest is still be accrued on the loan and the developers will end up paying more for the loan because of the extension that under the original terms of the contract.

“We’re not doing anything out of the ordinary,” DeJoy said.

DeJoy said the McLellans have used their own property as collateral for the loan to start the business, which will employee 30 to 40 people once it opens.

Anthony Dolce, Ward 2 councilman, said the extension is because the developers have had to push back the opening of the business because of environmental issues and delays in receiving building plan approval from the State Historic Preservation Office. He said, just like with the other loans approved by the JLDC, city officials have loan protection for worst-case scenarios.

Sam Teresi, Jamestown mayor, said the developers have had to secure 10-15 percent cash equity for the project and they are on the responsible for every “penny” they’ve borrowed, including using their property as collateral.

On the recommendation from DeJoy, the $180,000 loan the Jamestown Local Development Corporation approved, along with the council, in March 2017 would have no payments for the fist six months after disbursement, interest only payments for the first six months, term repayment extended from seven to eight years and $22,418 in cash flow relief.

The other creditors involved in the project include the Greater Jamestown Zone Capital Corporation, County of Chautauqua Industrial Development Agency, Southern Tier Regional Economic Development Council and Five Star Bank.

The council approved the loan revisement, with Liuzzo being the only “No” vote.

In other business, the council approved accepting a $100,000 grant through the State and Municipal Facilities Program to tear down two downtown buildings — 24 N. Main St. and 8 E. Second St. — that have been a source of concern since emergency situations.

In June 2017, a fire occurred at 24 N. Main St., which is next to the railroad overpass in downtown Jamestown. Since the fire, city officials have researched ways to either stabilize the structure, which is next to the Arcade Building, or tear it down. Last summer, C&S Engineers Inc. was hired by the Gebbie Foundation to create a condition assessment report.

As for 8 N. Main St., the building has needed to be torn down since the emergency demolition of 10-12 E. Second St. in November 2016. On Oct. 20, 2016, the building located at 10-12 E. Second St. had a partial roof collapse, which necessitated the emergency demolition.

In June, DeJoy said city officials received the grant with assistance from state Assemblyman Andy Goodell, R-Jamestown. He said even with the $100,000 grant, they will still need to use some funds from the city’s demolition budget to tear down the buildings.

On Monday, DeJoy said he would like to have the building demolished by the end of the year, but city officials are still working out the logistics.

The council approved four change orders for the Tracy Project Phase 2 renovation project. The total cost increase of the change orders is $18,973.

In December 2016, city officials received $1.48 million from the state through the Green Innovation Grant for the Tracy Plaza Phase 2 redevelopment project. The redesign work for Tracy Plaza will add more landscaping to make the structure more environmentally friendly, energy efficient and aesthetically pleasing. Plans for the redesign include relocating the Veterans Memorial to be closer to the wall of the firefighters’ area that is visible on southwest corner of the plaza. On the wall, the plan is for a mural to be painted depicting U.S. soldiers.

Since 2013, city officials have been renovating the deck area surrounding City Hall. The deck covers the city’s police and fire departments, a parking garage and storage areas. The first phase of the renovation project was to remove the parapet wall surrounding the building.

Last month, Jeff Lehman, city public works director, said the current phase of construction to Tracy Plaza should be completed by Dec. 1.

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