NIAGARA FALLS – The state is signing on with the city’s plan to draw young people downtown by paying off their student loans.

State officials have announced a $450,000 grant to help clear blight and revitalize vacant storefronts in a targeted area near the falls.

City officials say the grant will help them prepare for an influx of recent graduates by attracting the type of businesses the young people will desire as places to work.

“This grant will help us make concrete improvements to downtown Niagara Falls,” Mayor Paul A. Dyster said. “We will demolish blight and increase investment in storefronts to help our local business people.”

Community development officials plan to revitalize residential and commercial properties in the Park Place area using the funds, which include:

• $200,000 for property acquisition.

• $160,000 for demolition of blighted structures.

• $60,000 for administrative costs, which officials said would not be used for salaries.

• $30,000 in matching grants for local business storefront improvements.

Downtown housing has become a new priority for the city with hundreds of students attending the Culinary Institute Niagara Falls.

The new cooking school has brought more young people downtown for classes and on-the-job training in the institute’s public restaurants.

Niagara County Community College has rented out hotel rooms for those students to live in temporarily, but city officials say those students – and workers from the Seneca Niagara Casino – would benefit from more downtown housing options.

The student loan program has attracted hundreds of applicants, some from local colleges and others from as far away as Hawaii.

The city will use federal urban renewal funds to pay the graduates’ student loans for two years if they agree to live in the Park Place area.

That area – which runs along Main Street – is dotted with historic, well-kept homes but also dilapidated houses that have fallen into disrepair.

The city hopes to use the new state money to shore up or demolish those properties and to make improvements to businesses along the Main Street-Third Street corridor.

They aim to turn the vacant storefronts into the type of businesses that cater to young people: coffee shops, bookstores and boutiques you might see along Elmwood Avenue in Buffalo.

“By helping a local business person with renovations, we help him or her be profitable and potentially hire more employees,” said Community Development Director Seth A. Piccirillo.

“By helping people stay or move into the city, we can reduce taxes for our neighbors. This all helps us compete with other places for new residents, employers and small businesses.”

The plan was opposed by members of the City Council but appears ready to move forward.

Officials are finishing their review of applicants and plan to move the new residents into downtown homes or apartments next year.