The Erie County Legislature has approved a measure that can reverse one of its most hotly contested actions from 2009 while opening job-creation projects to special financing offered by the federal stimulus program.
The Legislature this week approved a bill championed by County Executive Chris Collins and the county Industrial Development Agency. It allows local governments and private developers arranging projects throughout Erie County to compete for a pool of federally allowed financing by selling "Revenue Zone Facility Bonds" and "Revenue Zone Economic Development Bonds."
With Revenue Zone Economic Development Bonds, the federal government will supplement up to 45 percent of a municipality's interest costs for its public works projects, while requiring that the developer pay construction workers the prevailing wage.
Revenue Zone Facility Bonds provide tax-exempt financing for certain types of private-sector expansions involving large factories, distribution centers, hotels, research parks and similar-scale undertakings.
Erie County can access up to $17.1 million in financing involving Revenue Zone Facility Bonds and $11.4 million in Revenue Zone Economic Development Bonds.
According to the legislation, the City of Buffalo also has a pool: $7.2 million in facility bonds and $4.8 million in economic development bonds. So does Amherst: $3.7 million in facility bonds and $2.5 million of economic development bonds.
The local governments are creating a committee to steer the award. It includes Legislature Chairwoman Barbara Miller-Williams, D-Buffalo; Economic Development Committee Chairman Timothy M. Kennedy, D-Buffalo; County Environment and Planning Commissioner Kathy Konst; a member to be appointed by Buffalo Mayor Byron W. Brown; and a member to represent the Amherst Industrial Development Agency.
Lawmakers enthusiastically approved the bill after hearing that at least two projects are ready to request facility bonds.
One is Mark Croce's redevelopment of a long-dormant building at Huron and Franklin streets. The other is a steel galvanizing operation, called Galvstar LLC, planned for the old American Axle plant on East Delavan Avenue.
Within the legislation is a paragraph that can undo requirements that the Legislature forced on an arm of the county IDA last year when it rewrote a Collins-requested measure.
Collins had wanted the Industrial Land Development Corp. to be able to step in and arrange low-cost, tax-exempt financing for nonprofit groups planning expansion projects since state-authorization for IDAs to do so had expired.
The Legislature approved the request but required that any organization also pay the prevailing wage to its construction workers.
Collins fumed that Legislature Democrats had again sold out to organized labor, and he used the issue to bludgeon Democrats on the campaign trail last year. Now, he may have reversed the requirement altogether, at least until the end of this year. The clause lets the ILDC's seven-member board waive the requirements that the County Legislature imposed on July 24 on a case by case basis, between now and Dec. 31.
Three of the ILDC's board members -- Kennedy, Miller-Williams and local AFL-CIO leader Michael Hoffert -- advocated the prevailing wage requirement last year. But Collins appoints the remaining four members and maintains control of the ILDC.
"We think the ILDC can be an important component of economic development going forward," said Collins chief of staff, Christopher M. Grant. "This is a major economic development win for the taxpayers. We believe there will be significant success with this program."