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Empire Outlets Mall Gets Another $20M in State Cash After Donating to Cuomo

By Nicholas Rizzi | January 27, 2017 1:51pm | Updated on January 30, 2017 9:46am
 Empire Outlets got another $20 million in grants from the state, weeks after its developers donated money to Gov. Andrew Cuomo.
Empire Outlets got another $20 million in grants from the state, weeks after its developers donated money to Gov. Andrew Cuomo.
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BFC Partners

ST. GEORGE — An outlet mall that will be home to Nike, H&M and Toys R Us stores has been handed another $20 million in taxpayer money — just weeks after its developer donated to Gov. Andrew Cuomo's re-election campaign, Politico New York first reported.

That's in addition to $47 million in public funds already secured by the for-profit project.

Empire Outlets had the latest grant approved by the Empire State Development Corporation (ESD) on Monday. The money is intended to improve storm resiliency at the building, according to the ESD.

So far, $66 million of the $350 million project has been paid for with state funds.

The latest grant comes weeks after one of the heads of developers BFC Partners donated $3,500 to Cuomo's 2018 re-election campaign. The governor has previously been criticized for doling out grants to his biggest donors, which includes BFC.

Between 2011 and 2014, the three partners of BFC — Brendan Baron, Joseph Ferrara and Donald Capoccia — donated more than $85,000 to Cuomo, according to state Board of Elections records.

The most recent $3,500 payment was made by Ferrara in two checks on Jan. 4.

"It's a clear example that this approach to economic development is about helping those politically connected folks first and coming up with excuses later," said Doug Kellogg of the nonprofit group Reclaim New York who's been critical of the project.

"This is a mall, this is not pitched as some kind of public safety project. Taxpayers are not going to get some return on this money, it's just a handout," he added. "It's not working for everyday Staten Islanders and there’s no effort here to improve the business environment for everybody else."

While Capoccia and Baron haven't kicked any money into the governor's campaign since 2014, Capoccia has donated a combined $15,400 since 2015 to several state senator and assembly runs.

These donations include a combined $2,000 in 2015 and 2016 to Staten Island Assemblyman Michael Cusick and $2,500 in 2015 to Assemblyman Matthew Titone, who's district Empire Outlets is in.

The governor's office did not respond to a request for comment.

Developers of the project and the ESD said the state funds are being used to improve the infrastructure around the project — not the actual outlet building or hotel.

“We are building new flood barriers, better roadways and Staten Island Railway improvements that will benefit all Staten Islanders and make commuting easier," said Sam Spokony, a spokesman for BFC, in a statement. 

"And we are doing it faster and at a lower cost to taxpayers than if the state had done the work itself.”

Hurricane Sandy brought five feet of water into areas surrounding the project, damaging piers, sidewalks and nearby MTA structures for the Staten Island Railway, ESD officials said.

"These types of improvements are not fully financeable through traditional methods and therefore require additional investment by the State," Howard Zemsky, CEO of the ESD, wrote in an outline of the grant.

The new money will go towards the three-level parking garage, new flood barriers and surge walls, a deck to protect the nearby Staten Island Railway tracks, new sidewalks, traffic lights and crosswalks, Spokony said.

Spokony added that BFC is kicking in $17.2 million and taking on $43 million in commercial debt for the improvements.

Last year, the project was awarded $47 million from two state agencies and $13.7 million in loans from the city's Economic Development Corporation.

The mall and the nearby New York Wheel was also allocated $3 million from then Borough President James Molinaro in 2013.

In 2015, Empire Outlets paid consultant firm Pitta Bishop Del Giorno & Giblin LLC — where Molinaro works a senior managing director —  $67,500 to lobby on their behalf with Borough President James Oddo, according to Office of the City Clerk records.

Molinaro is listed as one of the lobbyists for the project in city records.

A 2014 report from the New York Daily News found that companies run by Cuomo's largest donors got $15.2 million in grants from the state.

The Empire Outlets complex will bring 100 outlet stores, a 190-room hotel and a parking garage to a former parking lot adjacent to the St. George Ferry Terminal. Developers expect it to open this year.