LEWISTON – A not-for-profit entity that intends to hold a contest among upstate New York entrepreneurs was staked to more than $6 million on Monday.
A new Buffalo company with a patented means to keep people cool in hot weather, and a longstanding Lockport company planning to expand were the other recipients of money recommended by the board that passes out the proceeds from the sale of Niagara Power Project electricity.
Meeting at the Power Vista here, the Western New York Power Proceeds Allocation Board smiled on $6.2 million worth of funding requests from LaunchNY, Coolture and Diversified Manufacturing.
The board’s choices, which are expected to be ratified at next Tuesday’s meeting of the New York Power Authority’s board of trustees, came from $23.2 million obtained through the sale of Niagara hydropower earmarked for local industries but not actually allocated because of a lack of applicants.
The “loose juice” then is sold on the open market. Michael Huvane, NYPA vice president for marketing, said 100 megawatts is currently unallocated.
LaunchNY, the not-for-profit venture capital organization, was recommended for $5.4 million. Its president and CEO, John Seman, said he intends to hold a competition for the best business plans by startups and small businesses looking to expand.
The judging criteria and the exact rules are still be to determined in conjunction with Empire State Development at a meeting next week, Seman said.
Although applicants don’t have to be located within 30 miles of the power plant, the normal limit for its low-cost power programs, Seman said the winners have to move their businesses into that radius and stay for up to a year.
The purpose of the effort, he said, is “to foster a change in culture in the greater Buffalo area so entrepreneurship is seen as viable.”
A lack of venture capital in the region is one of the main drawbacks to such a shift in attitudes, Seman said.
Christina Orsi, regional director of Empire State Development, said the contest “strongly aligns with the Regional Economic Development Council’s focus on stimulating the economy through increased entrepreneurship.”
LaunchNY was started with a $635,000 grant from the U.S. Economic Development Administration, lined up by U.S. Sen. Charles E. Schumer, D-N.Y. It was matched by the John R. Oishei and Margaret L. Wendt foundations.
“I am excited to see the money we secured last year is already paying dividends,” Schumer said in a statement. “LaunchNY will now use both the state and federal resources it has secured to help bring innovative, job-creating businesses to our region.”
Coolture, a West Side Buffalo business that started producing special cooling vests 10 months ago, was recommended for $300,000. The vests, which sell for $279 through the company’s website, were initially intended for helping those afflicted with multiple sclerosis and other autoimmune diseases, since heat worsens the symptoms.
Luanne DiBernardo, vice president of marketing, said the idea came from her brother Van, an MS patient. The vests also have sports applications.
Company president and CEO Thomas P. Stewart, an adjunct engineering instructor at the University at Buffalo, said as many as 10 drivers in this month’s Indy 500 race will be wearing Coolture vests.
Diversified Manufacturing, a metal fabricating firm that plans a 45,000-square-foot addition to its Lockport plant, was recommended for $500,000 toward infrastructure costs.
The project will allow the company to shift 46 workers from an Amherst plant also owned by Diversified President Brian Costello. That will bring total employment at the Lockport facility to 145.
The Amherst plant has been sold to another company. “The funding would be in jeopardy if that backfilling would not have occurred,” said board member Dennis W. Elsenbeck of National Grid.
There were 18 applicants for the first round of funding, Orsi said. Several withdrew from contention and seven applicants were turned down, including the Buffalo Zoo, which sought $1 million toward a new polar bear habitat; Graycliff Conservancy of Derby; Content Savvy, a Snyder software firm; NBT Solutions, a Buffalo web mapping and GIS company; Niagara Hospice; the Roycroft Campus Corp. of East Aurora; and Twin Cities Community Outreach of the City of Tonawanda.
Two applicants were deemed ineligible because of an impermissible retail component, including Buffalo’s Market Arcade Cinema and Niagara Falls Memorial Medical Center, which seeks to turn the former South Junior High School into a health services and assisted-living facility.