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Koelmel picked for Power Authority Cuomo recommends banker as chairman

A leading Buffalo banker has been be tapped to run the New York Power Authority, the state's big hydropower producing agency that is also a major supplier of cheaper energy to upstate businesses.

John Koelmel, president and chief executive officer of First Niagara Financial Group, was nominated Tuesday by Gov. Andrew M. Cuomo to the Power Authority's board of trustees. The governor will recommend Koelmel be the board's new chairman.

Pending State Senate approval, Koelmel will replace Michael Townsend, originally appointed to the board in 1994 by then-Gov. George E. Pataki, as board chairman.

The Power Authority, whose holdings include the sprawling Niagara Power Project, has more than 1,400 miles of transmission lines and is exploring new options in solar and wind power generation.

Koelmel, of East Amherst, has been at the helm of a dramatic expansion of First Niagara.

"With decades of experience in key leadership and management positions with major private sector organizations, John Koelmel has the expertise needed to be a strong and effective voice on the NYPA board of trustees," Cuomo said in a statement.

Local politicians and business leaders congratulated the governor on the appointment.

"He will be confirmed in a breeze. I think it's a great appointment," said Sen. George Maziarz, a Newfane Republican and chairman of the Senate Energy Committee.

The nomination came a day before Cuomo is due in town today for a fundraiser for his 2014 re-election campaign account.

Koelmel declined an interview request, but in a written statement, he said he looks forward to working "to ensure the state's businesses -- which are our engines for economic growth -- have the power they need to invest, grow and create jobs."

The authority says its low-cost power supports 370,000 jobs in New York, many of them upstate.

Howard Zemsky, a Buffalo developer who is close to both Koelmel and the Cuomo administration, said the banker will bring his experience running a large corporation to a large state authority.

"This is a large, sprawling, vitally important entity, and John is accustomed to dealing with large organizations," Zemsky said.

Zemsky is chairman of the state economic development council appointed by Cuomo and whose panel members include Koelmel.

"John is somebody who does not speak to hear himself. When John talks, the room gets very quiet. He offers a lot of wisdom and insight at really important times. He's extremely well-respected in the community and extremely engaged in the community," Zemsky said.

"He wears responsibility very heavily, so John will take this job very seriously," the developer added.

Andrew Rudnick, president of the Buffalo Niagara Partnership, said the Power Authority in the past appeared to have a weaker board of trustees that let staff more directly dictate policy. He noted it took the area four years until this spring, without help from the Power Authority, to get a bill passed in Albany that keeps allocated but unused hydropower allotments for economic development within a 30-mile radius of the Niagara Power Project.

"John Koelmel is not going to be the NYPA [chairman] if it's a figurehead. So I assume there is going to be board strength associated with his appointment," Rudnick said.

Rudnick said the Cuomo administration grew comfortable with Koelmel during his work on the regional council.

"Getting someone from the region where NYPA has such an influence by what it does and the power it generates is a really good thing," Rudnick added.

Koelmel will not collect the board chairman's salary, administration officials said. Townsend, the current chairman and a Monroe County resident, has been making $90,000 annually.

An accountant by trade for more than two decades, including a post as managing partner at KPMG LLP, Koelmel began spreading First Niagara branches across the state a decade ago.

More recently, the bank has sharply grown into other states, including Pennsylvania and Massachusetts. It has acquired HSBC branches and bought the naming rights to the arena in downtown Buffalo.

Koelmel has led the bank since 2006. During his tenure, First Niagara's assets have increased from $8 billion to almost $40 billion, and its holdings include more than 400 branches in four states.

The American Banker publication three years ago named him "Community Banker of the Year," according to his bank biography.

Koelmel, 59, is also chairman of the board at Kaleida Health, and he earned an accounting degree in 1974 from the College of Holy Cross. He is a member of the regional economic development council put together to guide job creation efforts in the area.

It was not immediately certain what financial benefits First Niagara may be getting, or has gotten in the past, from deals with the Power Authority. Cuomo administration officials said Koelmel would recuse himself from any company dealings that might go before the agency.

The last Power Authority chairman from the Buffalo area was businessman Louis Ciminelli during the Pataki administration.