Three years after it was announced with great fanfare, Gov. Andrew M. Cuomo’s Buffalo Billion is almost completely committed to a range of projects across the region and will be mostly spent this year.
And it’s already paying dividends – economically and psychologically – even before all the actual dollars are spent, one of the state’s top economic development officials told a gathering of developers Wednesday in Buffalo.
In the past two years, local confidence has risen, private investment has risen, wages and average annual earnings have increased, the number of new businesses spiked, and the population between ages 20 and 34 has increased for the first time in 30 years, said Christina Orsi, regional director for Western New York at Empire State Development.
“There’s a lot going on. Hopefully, you’re feeling it,” Orsi said. “The buzz has been fantastic, both locally and nationally. We’re really starting to get a lot more interest. People are saying there’s a lot more good stuff happening in Buffalo.”
The economic development initiative got off to a slow start, as significant planning was required at first by the Regional Economic Development Council with help from University at Buffalo, Brookings Institution and McKinsey & Co. But when a blueprint was unveiled, much of the money was quickly allocated to one project after another just in the last 18 months, including the largest amount to the solar panel factory being built at the RiverBend site on South Park Avenue in Buffalo.
But not all of the region’s recent progress stems from the Buffalo Billion. The growth of the Buffalo Niagara Medical Campus was in the works already. The rise of Canalside is more due to funds secured by U.S. Rep. Brian Higgins, D-South Buffalo, from the New York Power Authority, and private investment by Terry and Kim Pegula.
“I don’t know if I would chalk up all of those improvements to the Billion,” said M&T Bank Corp. Chief Economist Gary Keith. “There’s a lot of things happening to the economy that are positive. The thing that’s most remarkable to me about what’s happening in Buffalo is the real estate activity. Money follows money.”
Still, he said, the Buffalo Billion initiative has changed the region’s outlook. “Attitude is an important element to any investment decision, and the Billion to me is an attitude-changer at this point,” he said. “We’ve had too little investment in Western New York, not just the state thing but from the private sector, too. And these are the kinds of eye-opening investments that give other investors confidence.”
Cuomo’s surprise pledge to Buffalo – announced during his State of the State address three years ago – put the spotlight on Buffalo and put the governor’s political might behind the effort.
“In all my years of economic development, I’ve never seen anyone so focused, from a state perspective, on Western New York and Buffalo,” said Orsi, who has worked under three governors at ESD. “He followed up that commitment. It’s real. I’ve been living it every day, working on implementing the many projects to really catalyze and continue the transformation of our economy.”
So far, only $174 million is actually “out the door” and spent on economic development projects, Orsi told a group of developers and other real estate executives at the Buffalo Club.
Most of the rest – $842.2 million out of $1 billion – has been committed to the various initiatives and it will all ultimately be invested, she said. But “the major spend” will occur this year with the construction of facilities and acquisition of equipment and machinery for the high-tech hub at RiverBend, the information technology hub at KeyCenter, and other medical, educational and tourism projects, she added. The tenant at RiverBend, SolarCity, has said it plans to invest another $5 billion, including the payroll of approximately 1,500 people expected to work at the factory.
The physical work of building RiverBend and other projects has started and is tangible, Orsi said, adding to the region’s economic upswing. Private-sector projects are moving forward. New companies are being launched with seed money. Job training programs are kicking off. Tourism efforts are underway around new parks and Niagara Falls. And the impact is already apparent, Orsi said, with 3,773 new jobs, $987 million more in total annual wages – up $676 a year in average wage – and 812 new businesses started in Western New York from 2011 to 2013.
“There is no question that the Buffalo Billion plan and committed funds are already having an impact,” said Dottie Gallagher-Cohen, president and CEO of Buffalo Niagara Partnership. “The narrative around the Buffalo Billion plan and the governor’s promotion of the region is generating some outside investment.”
In turn, that’s changing the mind set of the community, and driving even more. “Even though most of the Billion hasn’t been spent, everyone can feel the tremendous amount of energy and development and renewal,” Orsi said.
“When you start to think about what you can do and what you can be, and you have confidence, people start to invest. And we’re seeing that. We’re seeing unprecedented private-sector investment outside of the billion-dollar projects. And that’s really exciting.”
The state is now turning its attention – and $1.5 billion – to other upstate communities to try to duplicate in places like Rochester, Syracuse and Utica what it has done in Buffalo, and before that in Albany, she said.
“Other cities, they are just so envious of the Billion. They feel like it’s done some good things for Buffalo and they want a piece of it, too,” Keith said. “It’s more refreshing. Rochester would like to be Buffalo. That’s really a change in attitude.”