Clock ticking, Butternuts seeking tax-free status, would help Guilford deal


By Jim Poole

Butternuts Beer and Ale is seeking tax-free status, a move that makes its potential purchase of the former Guilford Mills plant far more attractive.
But even as Butternuts attempts to become tax free, the county-imposed deadline to buy the old factory is just 10 days away.
Butternuts has been trying to buy county-owned Guilford since late 2011 for $2.5 million, but delays in funding have slowed the deal.
Tax-free status may not affect the purchase, but it's a step forward for the brewery.
The status would come under the state's new Start Up New York program, part of which links new businesses to SUNY campuses.
Although regulations for Start Up New York won't be out until January--and Butternuts must still apply--the brewery would have not state income tax and employees would have no personal income tax for 10 years.
"We're pretty excited," said Butternuts rep John Lorence, adding that he's already received a letter of support from SUNY Cobleskill.
Under the program, students would do field work and have internships at the brewery, according to SUNY Cobleskill acting President Deb Thatcher.
"They'd have opportunities they otherwise would not have," Dr. Thatcher said. "They'd be involved in everything from making it to marketing."
Alicia Terry, Schoharie County's planning director who's been involved with the Butternuts-Guilford sale from the beginning, agreed that the tax-free program would be a huge boost.
"To me, does it make the project more attractive? Absolutely," Ms. Terry said.
"From a regional economic perspective, it makes every bit of sense."
Although Board of Supervisors Chairman Phil Skowfoe said "it would be great" if Butternuts attained tax-free status, it doesn't change the October 18 deadline.
At that point, next Friday, the county would open Guilford up to other potential buyers.
Mr. Lorence doesn't believe the contract, signed in December 2011, designates a firm deadline.
Butternuts is still seeking financing and couldn't close the deal by the 18th, Mr. Lorence said.
"We're working on options," he said Friday. "Even if we pulled the trigger today, we couldn't do it."
The brewery is working with the Schoharie County Industrial Development Agency on a payment-in-lieu-of-taxes (PILOT) arrangement that would cover property taxes, Mr. Lorence said.
The PILOT won't be ready by next Friday, Mr. Lorence said.
But even if the county holds firm with the deadline and opens the sale up to other companies, Butternuts remains a potential buyer.
"It's open to whoever's interested and can come up with the money," Mr. Skowfoe said.
"It's still open to them [Butternuts] just like anyone else. I don't see where it's a problem."