WARWICK—The Town of Warwick has made lemonade from the lemon of a closing prison. Gov. Cuomo decided to close the Mid-Orange Correctional Facility, a medium-security prison, in Warwick in 2011 and the town saw an opportunity to develop a corporate office and technology park.
When the state announced the prison’s closing in 2011, the town worked hard to have it stay. “We were happy to have them as a prison. They were good neighbors,” said Michael Sweeton, Warwick’s town supervisor.
The state was firm in its decision to close, so Sweeton approached the town board. The property was too valuable to let it sit. He did not want the state to put it out to bid “and somebody buys it that has plans for some crazy stuff.” The board authorized the supervisor to negotiate a sale.
Sweeton got all land allocated for public and recreational use for one dollar. During the negotiations for the rest, the state and the town had their own appraisals done, haggled over its value, and settled on a price. “Then I had to figure out how we were going to pay that,” he said.
Although the public spaces would be given to the town for $1, state law required that the commercial sections had to be sold at market value.
After all the preparatory planning, the town was ready to buy. That’s when an angel investor stepped in. The potential corporate site caught the interest of Warwick resident Robert Schluter. Schluter offered the town a $3.5 million mortgage with very generous terms.
The philanthropist investor considered the loan good for the town. “It was a short window of opportunity for the town to take advantage of a very good deal.”
The town now owned the site and planned infrastructure improvements. The town laid in new electric and natural gas lines, an investment close to $2 million. Another investor stepped in—the Orange County Industrial Development Agency.
Laurie Villasuso, the IDA’s chief operations officer, says it was a very good investment. “Michael Sweeton and the whole town did such a great job of securing the land and they had such a great plan to develop it, market it, and turn it in to what it is now.”
Villasuso calls the IDA’s almost $1 million investment a project expenditure. As the town made improvements, they forwarded the bills to the IDA, which paid the vendors directly. “The intent then was to give [the town] time to get the construction underway and ultimately to be completed,” she said.
Residents on Board
Sweeton got residents involved every step of the way. Just after the prison closed, he called on a group of local citizens to evaluate the site and deliver their findings to the town. The report was discussed at a public hearing and resoundingly approved.
An informal group of business leaders and municipal officials next formed the Warwick Development Corporation, which soon formalized as a nonprofit. “We had this core and when it became evident that the state was going to make us buy this, we said, ‘we need to formalize a mechanism to do this.'”
The town formed an LDC, or nonprofit local development corporation. Respected leaders in the county—Lou Heimbach, Maureen Halahan, former chamber president Bob Krahulic—as well as Sweeton and the Village of Warwick Mayor Michael Newhard serve on the board.
Schluter serves as an advisor to the LDC. He says he offers the common-sense advice of a resident as well as professional advice. He was especially concerned with environmental issues and having an uncontaminated site was a pre-condition to his investment. “Neither me as a lender nor the town as purchaser should get involved in something that could be toxic.”
No one on the board is paid. The LDC’s one purpose is to redevelop the site to benefit Warwick.
A traffic study was done during the pre-approval process. The town was already used to previous traffic to the prison. On a 24/7 basis about 450 guards entered the premises every day. “People are not going to notice this tremendous influx of vehicle traffic in the near future,” Sweeton said.
“There is a threshold capacity shown on the traffic study that, once it’s triggered, would require additional improvements to the site, for instance, a turning lane on Kings Highway,” he said.
The supervisor says the town will monitor traffic levels and has the bonding authority to make improvements.
Sites for Sale
The site has much to offer. “It’s a beautiful, scenic location,” Sweeton said. “I think that’s part of the attractiveness of it that we are hoping to sell.”
The town would like to have companies that use employees who work from home or at remote locations. Firms that do software development or research can expect a quiet, isolated environment free of commotion or distraction.
With new infrastructure and other improvements, the site has already welcomed The Yard Sports Village, a venue for soccer, lacrosse, baseball, softball, and football athletes, and an adaptive sports organization, Beautiful People.
The Yard’s owner, Anthony Abbatine, paid $1.7 million for his 38-acre site and said the town was “tremendously cooperative in allowing us to move as quickly as we did and at the same time to benefit from having all these additional fields and sporting venues right in their backyard.”
The town entered into a 15-year agreement with Beautiful People, a nonprofit that offers adaptive sports for children with handicaps. Executive Director Jan Brunkhorst says they will share a field with Little League. They are now trying to raise $350,000 for a safe surface accessible field and a smaller t-ball field. She calls the park “a wonderful, wonderful effort of repurposing.”
A newly-renovated building called Wickham Woodlands Manor has been set aside as a venue hall for residents. The space has a kitchen and space for about 100 people for parties, christenings, or weddings.
Ten shovel-ready pads are available for office or light industrial use. Three of the pads are under contract and Sweeton says they may close within two months.
The move-in is almost painless, he says. “The pre-approved pad sites truly are shovel ready because everything has been approved on them.” Sewer and water is already allocated, all utility connections are in, including natural gas and fiber optics.
Once a buyer closes on a pad lot and submits plans to the building department, Sweeton says they can begin construction within 10 days. “Everything is in, stubbed right to the lots.”
Along with aesthetic value, there are also financial incentives which the IDA can deliver to approved companies. A company can be exempted from 1) sales taxes on construction materials when they build and 2) a state mortgage tax.
Companies can also apply for a PILOT, or payment in lieu of taxes once a building is constructed, usually over a ten-year period. Companies continue to pay taxes on vacant land as assessed.
Once a building is constructed and assessed, companies are taxed at a gradual rate. “The first year they would pay based on $1 million assessment, the second year $2 million, and so on. That gives a company an opportunity for the company to get off the ground,” Sweeton said.
A town park, called Wickham Woodlands, was created around the 120-acre lake on the perimeter of the corporate site. A road winds along the lake where locals can launch boats, picnic, or watch a pair of nesting bald eagles. Company employees can enjoy the lake shore. “It’s a nice little loop they can make around the property.”
Sweeton said when the commercial pads are all sold and debts are paid, any monies above that get returned to the community for infrastructure improvements or other capital investment. “It was a win-win for the town.”
The former prison, now an attractive site for potential corporate clients, is a real value for Warwick, Sweeton says. “This will be a real benefit for generations to come. It was a great project and it was the right one for Warwick.”
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