By Tom Precious and Aaron Besecker

Gov. Andrew M. Cuomo said he gave Western New York economic and political leaders a simple message Thursday: Get to work now to find companies interested in a share of a $1 billion incentive package.

“We’re not doing the work for them. They have to do that,” Cuomo said was his message to the co-chairmen of the regional economic-development council, as well as Buffalo Mayor Byron W. Brown and Erie County Executive Mark C. Poloncarz.

“They have to produce. They can go out and now solicit and market, and they have some credibility, and they have a big backer, but they still have to go out and identify the businesses,” the governor said in an interview with The Buffalo News.

Cuomo’s comments came a day after he unveiled a $1 billion economic-development package for Buffalo and possibly some area communities over the next five years. The money and tax breaks are to be spent on companies willing to invest $5 billion in expansion or relocation efforts.

The Cuomo administration has not specifically identified how it did its arithmetic to reach $1 billion — which would come through various grants, tax breaks, possible transfer of government lands, job-training money and an assumption of some level of federal matching funds. The program is being kept intentionally vague as a show of flexibility to meet the diverse needs of potential future employers in Buffalo, state officials say.

Cuomo said he discussed the plan Thursday with Buffalo developer Howard A. Zemsky and University at Buffalo President Satish K. Tripathi, co-chairmen of the regional economic-development council, along with Brown and Poloncarz.

“I told everyone today this is not a blank check. We want jobs. We want leverage, and this is for new business opportunities,” Cuomo said.

If the local regional council does not find businesses willing to locate, the money won’t be spent, the governor said.

The Cuomo administration initially said Wednesday said that the money would only go to projects within the City of Buffalo. It later expanded that statement and said the effort is “targeting” Buffalo and that funds could go outside the city limits.

Brown confirmed the talk with Cuomo and said the billion-dollar pledge to spur Buffalo’s economy must be used on “new projects.”

“The governor was able to clarify for me that this money is for new development, new projects, new jobs in the community,” Brown said.

Nonetheless, Brown said, he believes that the overall package is expected to be city-focused.

State Sen. George D. Maziarz, R-Newfane, was among lawmakers who have called for the money to be spent beyond the city.

Brown said he expects the decision-making framework for how the money is spent to be similar to the recent process — through the Western New York Regional Development Council — that resulted in $100 million for various projects in the region.

Zemsky said he, too, believes there will be a “strong focus” on Buffalo when deciding how the money is spent.

The council will hold an “emergency meeting” — “emergency” in a good way — next week to begin talking about what comes next, Zemsky said.

The governor’s pledge carries an obligation to make sure the funds are used properly, placing “an important and positive burden on us to deliver results,” Zemsky emphasized, adding, “I would call it a once-in-a-lifetime opportunity.”

The governor’s plan does not promise $1 billion in direct state cash subsidies for companies expanding in Buffalo, but envisions moving money from a variety of pots of money that already exist in state economic-development accounts. Cuomo cannot make binding fiscal promises that would be binding on future State Legislatures, or even future governors. The program is envisioned to last for five years — two years after Cuomo’s first term would be over.

 The governor said in the interview that the $1 billion number was chosen as a “first installment” that could grow if successful. “It’s a step that will get the attention of the businesses we need to court. You need to attract one or two very large businesses that are significant employers, or you need to generate a cluster economy,” he said.

Why the $1 billion level?

“It’s a serious number, a significant effort. I think it’s going to be taken seriously by the marketplace,” Cuomo said. “We’re saying we’re serious and this is a serious effort and we’re real competitors.”

The governor likened the Buffalo effort to the state focus on Albany over the last 15 years that has seen billions of dollars in public money spent to lure high-tech companies involved in nanotechnology and chip manufacturing.

Past administrations in Albany have offered jobs packages for Western New York; the expiring Empire Zones program has helped hundreds of area firms operate nearly tax-free.

“We offered enormous incentives — basically, tax-free avenues to do business in Western New York — yet we still found it incredibly difficult to attract investment, period. It has to be about more than just money,” said David M. Catalfamo, who held a number of top posts in the administration of Gov. George E. Pataki, including a stint in the state’s economic-development office.

Catalfamo said the Cuomo administration should offer more than just cash incentives and consider unique regulatory and other breaks for businesses moving to the area.

Cuomo said that such an idea “makes total sense.”

“We also understand that we need to be creative and innovative,” he said.

The governor said he told local officials Thursday to be “flexible” in talks with prospective companies. “If they say, ‘I need a building, or regulations changed, or these approvals, or a joint venture’ — whatever it is, we’re open,” he said.

A generations-old issue at the State Capitol is geographic politics: when governors propose something, whether economic-development money or a new baseball stadium, all regions want in. How does he get around that with this new plan?

“You don’t. You don’t. You pay the price. You look at newspapers today, and you’ll see I’m criticized by other parts of the state for focusing on Buffalo,” the governor responded.

“I say, ‘You’re right. I’m focusing on Buffalo because I believe Buffalo has a great need and I believe Buffalo’s needs have been ignored for a long time,” the governor added. “If this is unique attention for Buffalo, it’s because Buffalo has unique needs.”

As jobs and population have declined upstate, politicians have made a steady stream of promises over the years. Hillary Rodham Clinton, in her successful run for the U.S. Senate from New York, for instance, vowed creation of 200,000 upstate jobs; the region lost jobs during the eight years she was in office before becoming secretary of state.

But Cuomo said politicians have delivered for upstate, noting the money poured into the Albany area that is transforming part of its economy.

“You can say government hasn’t delivered for Buffalo in modern political history. You can’t say government has been ineffective and there are no areas of success in upstate New York,” Cuomo said.

There have been several high-profile, state-subsidized investments in Western New York companies, which critics deride as corporate welfare, and the Buffalo school system gets the vast majority of its budget each year from the state.

But Cuomo said Buffalo has been “neglected,” compared with other areas.

“When government invests — and when they want to — and over a sustained period of time, it has made a drastic difference,” Cuomo said of the state’s help for the Albany area.

“How do you do that without offending the rest of the state?” Cuomo asked.

“I think the rest of the state gets or should get the sense of community and mutuality and that we’re stronger when we’re all strong.”

http://www.buffalonews.com/incoming/article697339.ece

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