By Ashley M. Casey

Staff Writer

Thanks to a $10 million grant from the Empire State Development Corp. and $3.5 million in tax credits, Tessy Plastics has completed the expansion of its production facility in Van Buren.

“At this stage of the game, we’re finalizing the construction of the facility,” Ed Pietruniak, Tessy’s vice president of finance and administration, said at a July 17 ESD hearing held at Van Buren Town Hall.

Last summer, Lt. Gov. Kathy Hochul announced that the state would provide roughly $13.5 million for the 248,000-square-foot expansion, which has a total project cost of $31,667,621.

Tessy officials said last year that if it weren’t for state tax credits and grants, the company may have taken up South Carolina on an offer to move production down south, where two of Tessy’s primary customers had asked the company to build a factory. New York state offered a $10 million ESD grant and $3.49 million in Excelsior Jobs Program tax credits.

“Being the host community, we’re glad Tessy is here,” Van Buren Supervisor Claude Sykes said at the hearing. “We hope this will lead to future development [in Van Buren] and Central New York.”

Per the grant agreement, Tessy is required to pay a 1 percent commitment fee of $100,000 and pay at least 10 percent of the total project cost. According to the general project plan provided by the New York State Urban Development Corp., Tessy has contributed $19,667,621 toward the project, accounting for 62 percent of the funding.

(Editor’s note: We received a clarification on the way this funding works from Jason Conwall, ESD senior director of communications: 

We require companies to pay for far more than 10 percent of a total project cost. In fact, the company is required to pay the full project cost in order to receive the entire $10 million grant, which is performance-based and provided as a reimbursement after commitments are met and confirmed by ESD.

Per the agreement, Tessy was required to spend $22 million and retain 808 full-time employees before they could receive 50 percent of the grant, and then the remaining 25 percent would be issued once the company spent another $2.5 million and added new jobs, and then a final $2.5 million and achieving the full job commitment. The 10 percent general requirement is part of every grant deal and is a way to show NYS that the grantee will indeed move forward with the project because it’s in the form of equity, which we define as cash injected into the project by the grant recipient.

The Messenger apologizes for the confusion.)

The expansion, which included a 248,000-square-foot addition to the 270,000-square-foot warehouse on State Fair Boulevard, features high-volume injection molding manufacturing and a high-speed post-molding assembly operation.

Tessy has retained 808 jobs and created 163 new jobs as a result of the expansion.

The state projects the following economic impacts of the ESD grant for the expansion:

• • Fiscal benefits to state and local governments of $27,503,459, with a cost of $10 million to state and local governments
• • 145 direct job years and 85 indirect job years as a result of construction
• • Creation of 1.24 indirect jobs for each direct job created
• • $209,537,180 in economic benefits (fiscal and total resident disposable income from project employment), or $397,230 per job

Henry Beck, father of Tessy President Roland Beck, founded the company in Elbridge in 1973. Tessy now has facilities in Elbridge, Van Buren and Auburn with additional locations in China and Lynchburg, Virginia. About half of Tessy’s business comes from the production of underarm deodorant containers.