Letter to President Alphonso O'Neil-White, HealthNow

February 12, 2004

Mr. Alphonso O'Neil-White
President
HealthNow.
1901 Main St.
Buffalo, NY 14240

Dear Mr. White:

I write today to urge you to consider moving the HealthNow headquarters currently in Buffalo to the downtown central business district in Buffalo when Canisius College takes over the current facility. I know your company has shown a preference toward relocating in the City of Buffalo, and I thank you for your commitment to Western New York.
There are several federal incentives that I believe make relocation to downtown an attractive option for companies like HealthNow. I recently helped secure a Renewal Community designation for downtown Buffalo from the U.S. Department of Housing and Urban Development that offers massive tax incentives for companies that build or rehabilitate buildings within this economic development zone. Companies that build or renovate within the Renewal Community can deduct a substantial portion of their renovation or building replacement expenses much faster than they would normally be allowed.

While it typically takes up to 39 years to recoup renovation expenses under existing federal law, in the Buffalo Renewal Community companies can deduct those costs over 10 years or elect to deduct the first $5 million in the first year. Under the Renewal Community legislation, the costs of cleanup and remediation in the development of brownfields sites can also be expended under more favorable terms than current law.

Companies may also be able to take advantage of the New Markets Tax Credit, which permits investors to take a 5 percent tax credit on investments made in the Buffalo Renewal Community. Yet another Renewal Community incentive would enable companies to forgo paying capital gains taxes on any assets purchased within the Renewal Community. Finally, if they remain in the Renewal Community, companies will be able to claim substantial federal wage tax credits for a variety of their employees.

Even though HealthNow, as a 501©(4) company under the Internal Revenue Code, is exempt from most federal taxes, a developer or redeveloper of the project can take advantage of these tax incentives and pass on part of the savings to HealthNow in the form of reduced rent and other favorable arrangements.

I am currently working in the Senate to pass legislation that will expand Buffalo's Renewal Community and give HealthNow even more options for a downtown location. I commend your commitment to Buffalo and am ready to do whatever I can to make this a win-win situation for HealthNow and for downtown Buffalo.

Please do not hesitate to contact me if I may be of assistance.

Sincerely,

Charles E. Schumer
United States Senate