ALBANY – Gov. Andrew M. Cuomo made repairing the upstate economy a theme in his latest State of the State message last week, yet his administration has been slow to implement a job-creation program designed specifically for the Buffalo area.
It is a program he signed into law last March.
More than $20 million in economic-development funds is on hand in a New York Power Authority account, but slothlike disbursement of the money is being criticized by state legislators and the region’s largest business advocacy group.
“This is a big deal for Western New York,” said Assemblyman Robin L. Schimminger, D-Kenmore, who last week wrote a letter to Cuomo on the matter. Cheektowaga Assemblyman Dennis H. Gabryszak, who sponsored the legislation creating the fund, also signed the letter.
“We’ve been concerned and have been constantly trying to get this thing moved along since the end of March 2012,” said Andrew J. Rudnick, president of the Buffalo Niagara Partnership, which spent a decade lobbying for the creation of the special Power Authority funding source.
What has his group been told about the reason for the delay?
“I don’t know,” Rudnick said. “We’ve been told they just haven’t gotten to it.”
The Cuomo administration said Sunday that the program is close to getting under way.
Besides the Power Authority program, business groups and lawmakers say the Cuomo administration also has been slow to adopt rules for a $25 million tax break program targeting manufacturers located in high-unemployment areas. That tax incentive was approved 13 months ago – December 8, 2011 – during a special session that also saw passage of income tax hikes on wealthy New Yorkers and tax breaks for middle-class residents.
But it took the Cuomo administration until Tuesday to issue formal guidelines describing what kinds of manufacturing companies will be eligible to apply for the tax breaks being offered to firms with 100 or fewer employees.
Cuomo administration officials dismissed the criticism, saying that the rules and guidelines for the program are now in place in plenty of time for companies to apply for the incentives in the upcoming tax-return season. Administration officials stressed that publication of the guidelines last week will not prevent any company eligible for the credits in the 2012 tax year – the first year of the program – from receiving them.
But companies were only able to tell last week whether they might qualify for the $25 million program.
Insiders say the delay was, in part, due to the vagueness of the December 2011 legislation that did not more clearly set parameters for the program.
The issue in the Power Authority funding involves a program that provides low-cost hydropower to companies within a 30-mile radius of the Niagara Power Project in Lewiston. Not all of the available power is used by local companies in a year, so the new program – passed with the state budget last March – calls for translating any unused power into a cash-grant program for job creation in the area instead of funneling the power’s proceeds into the Power Authority’s general budget.
The money can go to those projects that “support the growth of business”and can include investments in buildings, equipment, land purchases, research and development, and tourism ad campaigns.
The money cannot go to certain establishments, such as sports venues, certain retail outlets as determined by the local board or entertainment-related ventures.
The fund now has $20 million waiting to be distributed, and Schimminger and Gabryszak estimated that as much as $17 million a year could be available once the program is under way.
The problem is that the law requires creation of a five-member Western New York Power Proceeds Allocation Board to distribute the money. The Assembly and the Senate each gets an appointment, and the governor gets three, including the panel’s chairman.
Assembly Speaker Sheldon Silver, D-Manhattan, named the Assembly’s choice last year, and Senate co-leader Dean G. Skelos, R-Rockville Centre, has submitted a nominee to the governor on the Senate’s behalf.
But Cuomo has yet to appoint his three selections, so the board, 10 months after the law’s approval, is still not created.
“We’ve identified several individuals for these positions, all of which are undergoing the same rigorous background checks that all gubernatorial appointees are subject to, and we anticipate appointments to be made soon,” Richard Azzopardi, a Cuomo spokesman, said in a statement Saturday.
“The significance is the amount of money that can come back to Western New York to help in the economic-development process, be it jobs, infrastructure or whatever,” Gabryszak said. “So we want to get the board in place so we can begin the process so we can try to get money flowing.”
Schimminger and Gabryszak, both Democrats, praised the Democratic governor for focusing efforts on the Buffalo area.
“We’re seeing some good things. This is an added step to help,” Gabryszak said of the still-dormant power proceeds board.
The $20 million that has accumulated has been kept in an escrow account by the Power Authority, lawmakers say. Still, it is money that could have been spent to help create job opportunities in one of the economically hardest-hit areas of New York, they say.
“As we say in the business,” Rudnick said, “that’s real money, and it’s cash.”