By Steve Hughes
December 17, 2012
When the state’s regional economic development competition was announced in 2011, officials hailed it as a job creator and a game changer. And one year later, the Mohawk Valley already has seen some results from the $60.2 million it received for 59 projects. Large-scale projects such as a biomass energy plant in Rome are under construction, and smaller initiatives such as the environmental technician training program at Mohawk Valley Community College have helped some workers find new jobs. The Mohawk Valley Regional Economic Development Council praised its own efforts in its 2012 action plan, citing the creation of 730 jobs and retention of 840 through those projects over a five-year period. Yet, only 25 to 60 jobs have been created so far, and seven of the projects have been completed, according to the state. Another 27 projects are projected to be completed by the end of 2013 and three are on hold.
As the state prepares to announce the next round of funding this week, economic development officials say they have made progress and these efforts will take time. “We’re not just buying jobs,” said Bjong Wolf Yeigh, Mohawk Valley council co-chairman and SUNYIT president. “We’re putting the infrastructure in place that this region has needed for a very long time.” Fiscal watchdogs, however, say the spending must be monitored closely to ensure the program creates the quality jobs it promised. The competition is meant to create jobs, but it’s also designed to set each region up for further development by investing in infrastructure and redevelopment projects, according to state and local officials.
The larger projects — such as the Fage Yogurt plant in Johnstown, which would create 150 jobs over four years — take time, said Jason Conwall, a spokesman for Empire State Development Corp. “Many awards are investments in major projects that are on track to be completed within five years,” he said. “The council endorsed these long-term investments because they are critical to increasing the region’s capacity to capitalize on higher-value industry and jobs in the future.” Gov. Andrew Cuomo announced the statewide competition soon after he took office. He dangled millions in tax credits and capital to 10 regional councils in exchange for a strategic five-year plan and regionally important projects. These projects were supposed to revitalize crumbling sewers and roadways as well as create new jobs across the state through public and private investment. But about two-thirds of the funds would be handed out anyway by state agencies such as the Department of Transportation. Cuomo’s process just consolidated and streamlined the application process.
In December 2011, the governor announced the results of the first competition. The top four winners received significantly more money, around $100 million each, while the bottom six regions received significantly less. “It’s a big change to New York’s approach to doing business,” Larry Gilroy III, co-chairman of the Mohawk Valley Regional Economic Development Council and president at Gilroy, Kernan and Gilroy, said recently. The process “puts the decision-making process closer to the ground,” he said. The Mohawk Valley includes Oneida, Herkimer, Schoharie, Montgomery, Fulton and Otsego counties.
Locally, three projects received a combined $25 million — about 40 percent of the region’s award — to help spur the development of the Computer Chip Commercialization Center at SUNYIT in Marcy.
Only one of the three, a $15 million grant that went to Fort Schuyler Management to build the facility, will create permanent jobs. The other $10 million was split between two infrastructure projects for the site: a 9,350-foot sewer upgrade and an 8,800-foot access road with bike paths and underground utilities. Those two projects, though not large and flashy, are key to the site’s future success, Gilroy said. “They’re not sexy projects,” he said. “But it puts us in position to bring high-tech jobs to the area.” Fiber Instruments Sales of Oriskany received a $200,000 grant that will create up to 10 full-time jobs and help the company complete a new piece of fiber optic equipment. The grant helped make a larger project possible for the company, said President Frank Giotto.“We’ll be showing our product at a national trade show next spring,” he said.
While the awards were announced last December, some of the projects did not finalize their contracts until months later. Those contracts laid out the expectations for the state and the recipient. That means some projects are only a few months into their progress. Ground was broken in August on a 15-megawatt biomass power plant at Griffiss Utilities Services Corp. in Rome. The $20 million plant received a $1.5 million grant, but as with all of the state’s grants, will not receive the money until it meets project benchmarks. Everything is on schedule and the plant will be operational by next October, said President and CEO Daniel Maneen. “The plant is going to help make the Griffiss Park tenants more competitive,” he said. “Most green energy actually costs more than normal energy sources but this will cut their energy costs.”
The next round of awards will be announced Wednesday in Albany. This time, the Mohawk Valley council submitted 32 priority projects they say could create up to 1,190 new permanent jobs and retain 3,130 more. The regional council approach is a step in the right direction but the state has to closely track the projects’ success or failures as well as the effect on surrounding communities, said Matt Ryan, executive director of the Alliance for a Greater New York, a watchdog group that has criticized the state’s use of tax breaks and subsidies. The state also needs to do a better job of making the projects’ results transparent and ensuring that underperforming projects lose their funds.“There should be a money-back guarantee,” Ryan said.The state does maintain an online database with each project’s funding amount and anticipated completion date but it is not 100 percent accurate.
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Article also appeared in The Little Falls Times