Does the Regional Council system really boost jobs?

Sitting in the Hart Theater yesterday in Albany, I felt the regional pride that comes with the $90.2 million dollar grant and incentive award that will go to the North Country.

It’s a huge win for the region, and a major signal of praise to economic development planners — most of them volunteers — who crafted a winning plan for the second year in a row.

A lot of the projects on the list for funding appear to make a lot of sense.  There will be new capital for starting tourism businesses in the region, and dollars to boost apartment and home construction around Fort Drum.

I’ve also heard nearly universal support for the idea of shifting more of the decision-making to regional leaders, meaning fewer decisions being made by bureaucrats in Albany.

But I’m a journalist, and part of my job is to be skeptical.  So without detracting from the kudos and jubilation, here are the questions that still need answering as this effort goes forward.

1.  Does it work?  Governor Cuomo cleverly repackaged a lot of already existing tax-incentive and grant money into this statewide competition.  In theory, that’s meant new regional focus, bottom-up thinking, and creativity.

But everyone I spoke to yesterday acknowledged that there’s no clear evidence yet that the effort is actually boosting jobs.

Governor Cuomo said that it will take time to measure the impact of this effort on business start-ups and private investment.

North Country council co-chair Tony Collins suggested that only as we approach the end of the first five-year plan will we have clear data about what’s working and what’s not.

Fair enough.  But I think it would be a healthy thing for a neutral third party — maybe the Comptroller’s office — to audit these efforts and offer independent scorecards.

Are the dollars being spent wisely?  Is there clear evidence that these taxpayer investments are leveraging new economic energy?  Right now, it’s still hard to tell.

In the past, economic development programs that looked good on paper were allowed to churn forward for years without proper evaluation.  The governor should avoid that mistake.

2.  Is it fair?  I did the math and it appears that in this round of funding, people in the North Country will receive approximately $180 per person in economic development funding.

People in New York City, by contrast, will receive around $6 per person.  that’s a huge disparity.

The problem here isn’t that the North Country’s plan won extra money, while New York City’s plan — for the second year in a row — failed to win one of the top prizes.

The questionable approach is that the pools of money — between $50 and $95 million — are divvied up by region, regardless of population.

Which means that even if planners in New York City win one of the bonus grant awards, their per capita spending will still lag far behind that of other low-population regions, including the North Country.

I suspect that over time that will raise eyebrows and doubts among planners downstate and in urban communities.

3.  What do we do with controversial initiatives?  So far, the North Country Regional Economic Council has steered clear of the most controversial issues — which is probably wise.

But there are good arguments to be made for (and against) funding for projects like the Rooftop Highway in the St. Lawrence Valley and the Adirondack Scenic Railroad from Old Forge to Lake Placid.

State agencies, including the Department of Transportation, have signaled that they want guidance from the councils on these thorny issues.

But how does the Council adjudicate these questions, especially given that many of the council’s members and leaders are fierce partisans in the debate over those causes?

So far, Governor Cuomo’s project hasn’t offered any clear guidance for that kind of refereeing.  On the contrary, there seems to be strong incentives for avoiding controversy.   So it’s a bit of a Catch-22.

4.  Can volunteers keep this program going? Governor Cuomo has pulled off a truly Tom Sawyeresque feat with his Council initiative, convincing hundreds of economic development professionals and business people to work long hours without pay.

Yesterday in Albany, there was a lot of celebration and high-fiving.  But behind the scenes, there’s a lot of fatigue and uncertainty about how to keep enough people in the room deliberating over these complex priorities.

It’s also worth thinking about whether asking people to volunteer on this effort limits or self-selects the kind of folks who can be involved.

It would be great to have grassroots level farmers, independent business owners and blue collar working folks collaborating on these decisions, or at least offering a lot of input.  But it’s hard to imagine them sparing them time.

These aren’t condemnations of the Council approach.  To be clear, I hear more hopeful and creative conversation around this effort than around any jobs-and-development push in my 13 years in New York.

But as Governor Cuomo’s bottom-up effort takes more shape, there may be a bit more top-down thinking needed to make sure the program is sustainable.

 

25 Comments on “Does the Regional Council system really boost jobs?”

  1. Newt says:

    On the Time-Warner news channel yesterday when covering this the reporter, or someone interviewed by her, suggested that these awards were really based on regional need, not their ability to put on a dynamite plan. The example of the Capital District was given. It has a strong economy, and it apparently didn’t get much. How this correlates to the NYC area per Brian’s comparison, I don’t know. Especially in view of the Sandy factor.

    In spite of what many say here, I think the North Country often gets special treatment from Albany.

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  2. TomL says:

    Well, the Regional Councils are smart to avoid the interstate / highway issue. The average cost of a rural limited access 4 lane divided-highway is about 5.5 million dollars per mile – not including bridges or off-ramps. With the regional council’s 90 million dollars, at best you can build about 16 miles of Rooftop Highway.

    I like the many small, local projects that are the focus of the local Regional Council’s plan. If anything is going to generate jobs, it is small businesses and local economic development efforts. We won’t know until a few years whether it does work or not, but it IS more transparent than the old political patronage method of allocating economic development funds.

    Brian Mann, instead of looking at the $$/citizen allocation among the Regional Councils, what would be interesting to hear is what did the unsuccessful proposals, say those of NYC, propose? From what I read this morning, New York City (and some of the other unsuccessful ones) were about putting a lot of funding in a few Big Initiatives. The question may be reframed as ‘what is better – lots of small or few big economic development projects?’. Like, apparently, the people who decided in the last two rounds, I would go with many small. New York has repeatedly done few big, and spent a lot of money with little to show.

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  3. Brian Mann says:

    I think these are good points. There are lot of complicating factors here.

    But I do think it warrants a long think whether it makes sense that some regions having half a million people should be competing for the same pots of money with regions with 8 million people.

    It’s also worth noting that while here in the North Country the average citizen can have fairly up-close access to the process, people in NYC just won’t.

    Maybe one solution would be to have two parallel efforts, one with competing economic plans for each of the five boroughs of NYC, and another competition for the nine economic regions that make up the rest of New York state.

    –Brian, NCPR

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  4. Mervel says:

    Large sections of the North Country are the poorest regions of the entire state, it would make sense to look at boosting economic development in areas of high need.

    I do think it is a great point to really look at this money and its outcomes, it is a LOT of money for one area. We have gotten this money before so it would make sense that we should be able to analyze the impact of the previous years awards.

    I think it should be targeted and focused rather than dispersed and absorbed. For example I question building apartments in Watertown, there is a housing demand around the base and that demand should be met by the private market. Bases come and go and rise and fall, in addition the armed forces have a lot of money, I am not sure why we would use precious state dollars to help the military relieve a housing shortage? That is just an example, but maybe there is a case to be made that I am not seeing?

    Anyway good points and I hope we get some good results.

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  5. John Warren says:

    “I did the math and it appears that in this round of funding, people in the North Country will receive approximately $180 per person in economic development funding.”

    I’ll be looking forward to my check.

    These economic development schemes ought to be called by their proper name – corporate welfare.

    Like/Dislike this comment: Thumb up 5 Thumb down 1

  6. Pete Klein says:

    While I am happy to see the amount of money coming to the North Country and Hamilton County in particular, the disparity pointed out by Brian does remind me a bit of the disparity that takes place at the federal level with where tax dollars go – the poorer and mostly red states getting more than the larger and mostly blue states getting less.
    Whatever!
    I guess this “leveling of the playing field” would be okay if those getting more than they put in (in taxes) would at least be grateful.

    Like/Dislike this comment: Thumb up 3 Thumb down 2

  7. Peter Hahn says:

    One of the “rules” that it would be good to keep pointing out over and over is that the regional council is looking for “consensus” projects. That would seem to rule out money for either the rails to trails project or extending the train to Tupper Lake. This should concern people who live in Tupper Lake.

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  8. Mervel says:

    90 million would hire a lot of teachers.

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  9. The Original Larry says:

    Over $700 million spent state-wide on commercial projects of marginal viability, corporate bribery, make-work projects and unneeded “development” schemes. If any of these projects made economic sense they would have been developed by private enterprise. Only the government blows money on things that won’t work.

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  10. Walker says:

    Interstates, Larry, Interstates. (And the Internet, too.)

    And then from the private side, there’s the Edsel, and the other whale-size cars of its era, and an endless list of private industry blowing money on things that don’t work; Google “corporate miscalculations.” Take Google’s $12.5 Billion Miscalculation as a current example.

    It is decidedly untrue that “Only the government blows money on things that won’t work.”

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  11. Walker says:

    Though admittedly, it would be hard to find a private industry miscalculation as vast as the Iraq War.

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  12. scratchy says:

    Newt:
    “In spite of what many say here, I think the North Country often gets special treatment from Albany.”

    Certainly, the north country is the only region that Albany has tried to deny access to reliable cell phone (APA regulations restricting cell phone towers). So, I suppose you are correct in a way, just a different kind of “special treatment.”

    Brian Mann,

    But shouldn’t the state redistribute wealth from prosperous regions (such as NYC) to poor regions (of which the north country is one). Or are you against redistribution?

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  13. Mervel says:

    To me I would like to see some specific long term capital projects completed.

    Thus I am thrown into wanting some of the controversial things. What often happens is that at the end of the period there is no outcome you can point to, no long term capital asset created. You have spent the money on studies, salaries to do the studies, tax relief for the area, marketing of the area and so forth. The rooftop highway would not qualify as the rooftop highway is a multi-billion dollar investment, 90 million would not do anything except study and market the project. You could build some really cool trails with 90 million though.

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  14. Mervel says:

    You could also evenly divide the 90 million up into 20 4.5 million dollar projects that would employ many project staff for about three years, than that would be it.

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  15. Walker says:

    You know, if the $90 mil could build a parallel trail from Saranac Lake to Old Forge, you’d have a consensus project. Win-win. (As long as you didn’t waste it on planning.)

    Like/Dislike this comment: Thumb up 1 Thumb down 0

  16. The Original Larry says:

    How much of the $90M is going to help maintain hospitals and health care facilities across the North Country? If we stopped wasting money on idiotic projects we would have plenty for hospitals, schools, etc.

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  17. Jim says:

    $738M makes headlines and political hay for Cuomo; $90M for our region is impressive but it has a cost. Much of this funding, through the REDC/CFA process has been redirected toward high profile projects that perhaps will prove successful in the long term, but only time will tell. The North Country has always been on the plus side of the ledger regarding grant funding, but for all the hoopla over $90M it seems that smaller municipalities and projects aren’t doing as well as they once did.

    Look at just one funding source, CDBG, in St Lawrence County. The St. Lawrence County Planning Office has, for years, written successful CDBG housing applications for small Towns and Villages as well as a county wide homebuyer program. In a typical year these awards would total $1M-$2M. In addition, Massena, Gouverneur, Potsdam and Ogdensburg would usually, between the four, bring in another million or two. Net total of $3-$4M a year into the St. Lawrence County economy supporting suppliers, a multitude of small contractors, stabilizing the tax base and helping struggling homeowners. This year the State gave the NCREDC $1M to divy up across the entire 7 county region.

    The same thing has happened with Main Street, HOME, Parks & Rec, etc. ACCESS to Home and RESTORE, programs for disabled and elderly homeowners, appear to have been eliminated altogether.

    Just say’n

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  18. mervel says:

    Larry,

    Health care would certainly be part of economic development, I would think it would be very reasonable to use the money to efficiently support critical health care needs in the North Country.

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  19. mervel says:

    I assume however that the money is already specifically allocated for projects that was part of the original proposal to win the grant.

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  20. Newt says:

    scratchy-

    I agree that some of the money that comes our way is to compensate for the restrictions of being the Empire State’s big, beautiful, back yard in a relative state of nature for both the common folk and the Nouveau Gilded Age Great Camp crowd.
    But I’ve noticed that cell service on the Northway is quite a bit better these days.

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  21. knuckleheadedliberal says:

    Someday everyone will have cell phone access everywhere. If we hold out we can be the last place on Earth that you can be un-plugged. Should be worth something.

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  22. knuckleheadedliberal says:

    I went to one of the local meetings of this new economic development deal last time around and it didnt seem all that different to me. Same old blowhards scratching for pork as always. Though I admit it was in the Capital District region. I like some of the things the NC region did like the slaughter houses.

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  23. The Original Larry says:

    Mervel,
    I agree that it would be wise to use this money on projects that are needed, like health care and schools, etc. However, as long as we keep funding private industry, building minor league baseball parks and developing supermarkets there won’t be enough.

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  24. Ann Melious says:

    Since upstate New York, the Adirondacks especially, is (arguably, of course) the worst economy in the nation, I would be happy if NCREDC funding SUSTAINS jobs. The number of small businesses I have seen leave this region in the past several years is not encouraging. More government funding for schools or healthcare becomes in issue of diminishing returns if people cannot work in a community (or within a reasonable radius). Retirees alone cannot sustain our communities. A single year is a little early to start determining whether or not jobs have been created since most NCREDC projects have not been completed or have just been completed. Some are multi-year projects.

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  25. Brian Mann says:

    Ann –

    Fair points – and this is essentially what Tony Collins and Governor Cuomo are saying, that the new system needs time to prove itself. But it still seems like a good, independent metric for studying success/failure would be helpful to determine what sorts of regional plans are working and which approaches aren’t.

    Also, I think your argument that this region has “the worst economy in the nation” isn’t, well, even remotely arguable.

    We do have a deeply stressed economy, to be sure. But by any factual metric we’re not even on the radar screen for deeply depressed.

    Yuma, Arizona has unemployment of nearly 30%. In Nevada, one in every 300 homes is in active foreclosure. Many parts of rural America are losing population at a prodigious rate, while the Adirondack-North Country is merely (depending on your word choice) stable or stagnant.

    While many of the Adirondack Park’s important communities face frightening challenges, many others — Lake George, Old Forge, Saranac Lake, Lake Placid, Essex — face various forms of growth and reinvention.

    That’s not good enough, to be sure. But it’s a lot better than parts of rural Kansas, or Nebraska, or Oklahoma.

    –Brian, NCPR

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