NCIDA pulls Stavatti Aerospace incentives

Mar. 27—SANBORN — After nearly three and a half years of promises to build aircraft at a former U.S. Army Reserve Station, the Niagara County Industrial Development Agency's patience with Stavatti Aerospace has run out.

The agency voted to terminate $2.15 million in tax incentives it awarded Stavatti, as its members cited a lack of progress to justify an extension.

"The fact there hasn't been any progress is concerning," said Vice Chairperson Jason Krempa.

Two IDA members, Krempa and Mark Berube, were given a tour of a 47,000-square-foot hanger where plane prototypes were due to be built. While they felt the meeting was productive and the site had potential, very little activity was currently happening there.

Agency Counsel Mark Gabriele noted that 20 to 40 employees work at the site from companies renting space there rather than Stavatti.

The IDA granted the incentives in October 2020, which were originally going to expire on Dec. 31, 2023. A 90-day extension was granted in December.

Original project documents state it would cost $25.875 million, with costs having risen since. Stavatti promised that 363 new jobs would be created in Niagara County within three years of completion.

As of March 2024, Gabriele said that Stavatti only used $4,000 of sales tax benefits, with a little over $50,000 spent on eligible expenses at the site. Stavatti requested a two-year extension to those benefits, but the IDA never grants such extensions beyond one year.

Speaking before the IDA, John Simon, a former NCIDA executive director, said Stavatti received a letter of intent on March 20 from an unnamed U.S. ally to retrofit 16 older planes with more modern American parts, with the contract claimed to be $600 million. He added they had between $1.3 million and $1.5 million worth of renovations so far, nowhere near ready for their plans but enough to get the aircraft in the main hanger for upgrades.

Despite having futuristic plane designs on their website and claiming to hold patents on their aircraft, Stavatti has reportedly yet to build one of these planes.

Previous reasons given for this delay were the pandemic and that the Department of Defense's attention was on the wars in Ukraine and Israel.

IDA members expressed concern about how much of the project would be completed in the timeframe of a given extension, resulting in Stavatti repeatedly asking for more extensions.

"I think what's important here is setting a precedent or not setting a precedent," said IDA member Cliff Scott, with Chairperson Mark Onesi sharing the sentiment that granting an extension would set that precedent for other businesses.

Simon said that Stavatti plans on reapplying for these incentives as soon as possible, which would restart the same three-year period of using these incentives if approved. It would take them at least 45 days to do so.