NYPA to Canal Side: Have (A Lot) More Money!

13 Jul

A multiperson news conference was held today at Canal Side to announce the signing of an historic new deal between the New York Power Authority and the Erie Canal Harbor Development Corporation. Under NYPA’s relicensing agreement, ECHDC was to receive payouts over 50 years to help fund the development of Buffalo’s waterfront. Under today’s agreement, the same net aggregate amount will instead be paid out over 20 years, thus increasing the annual amount to $8.5 million per year.

On that basis, ECHDC will be able to issue $105 million in bonding to fund major infrastructure initiatives at Canal Side. The Canal Side project is slated to cost about $315 million, and is expected to generate $9.5 million in sales taxes, and $1.2 million in annual property taxes to the city.

Congressman Brian Higgins (NY-27) used strong language to explain that, in his view, this deal helps right a 50-year old wrong. Local politicians compromised with NYPA too much during the last agreement, and with this change the immediate benefits are much more helpful to the overall project.

The money will lead to additional street restoration, sewer work, and other work worth millions of dollars, and create jobs. Higgins added that the community can change its future when it stands up to itself, and repeated that Canal Side will “be what we make of it”. He added that this refinancing will help Buffalo’s waterfront evolve into a place of “youthfulness, vibrancy” and a variety of mixed uses.

NYPA CEO Richie Kessel admitted that the power authority hadn’t lived up to its responsibilities in the past, including the recent relicensing. He said that the “time has come for NYPA” to give some payback to Erie County and the City of Buffalo. Kessel said that Governor Paterson had urged him to reach out to Rep. Higgins, who then urged Kessel to reach out to Erie County Executive Chris Collins and Buffalo Mayor Byron Brown. Kessel stressed repeatedly that NYPA isn’t just cutting a check and “walking away”. He pledged that the authority would make sure that the project is done and done right. Making a joke about ways in which he could personally persuade Bass Pro to sign a final agreement, he was the first to bring up the elephant in the proverbial room. Kessel concluded by pledging to do something similar in Niagara County, adding, “we’re here…to the end”

County Executive Chris Collins waxed poetic, stating that this announcement was about progress and collaboration, and that “we are living the renaissance of Erie County and the City of Buffalo right now”, adding that Erie County was a “shining light of success” as compared with other New York State counties. Mayor Brown echoed Collins’ collaboration theme, lauding the fact that $105 million would soon be available for this historic project, which he called “vital to city/county revitalization”, and that the “resources are now here; the money is in the bank.”

Notably absent from this announcement was a single, solitary state-level politician. With the exception of Governor Paterson and NYPA, the state legislature was left completely out of the loop. Notably present, however, was Erie County Legislator Tim Kennedy, whose district includes South Buffalo and who is running for the State Senate against incumbent Bill Stachowski (SD-58).

7 Responses to “NYPA to Canal Side: Have (A Lot) More Money!”

  1. Brian Castner July 13, 2010 at 3:11 pm #

    An honest question, that perhaps a finance person much smarter than me can answer: What is the total dollar amount provided by NYPA if we had gotten the money over 50 years, instead of 20 years with a costly bond conversion. Are we taking $105M now over a much bigger payout over the long run? Or does inflation really make this a good deal. 2057 is a long way away to renegotiate.

    BTW, on a side note – why do we keep having conferences about how this is getting paid for? I thought Canalside was paid for years ago, out of primarily state dollars.

    • Alan Bedenko July 13, 2010 at 3:32 pm #

      My understanding is that the overall figure is identical – that the same amount that would have been paid over 50 years will now be paid over 20, resulting in the bonding opportunity, and what Higgins called $55 million in net new funding.

      To me, it all smelled a lot like a set of preconditions laid by Bass Pro being met by the state. I asked that question, and Jordan Levy denied it, trying hard to go between being excited about Bass Pro, but in the next breath stressing that Bass Pro isn’t the sine qua non of this project.

  2. Jennifer Diagostino July 13, 2010 at 3:38 pm #

    Just a note, I attended the press conference as a representative for Sam Hoyt, and Senator Thompson’s office had two representatives present. We were there but not acknowledged by the panel.

  3. Colin Eager July 13, 2010 at 4:25 pm #

    So NYPA takes a regional asset that could potentially produce good paying local jobs, sends it around the state, and in return we get some money to throw at retail? Forget about canal side or bass pro for the moment — is that a good deal?

  4. Mike in WNY July 14, 2010 at 12:45 pm #

    Higgins has made sure that 50 years of fail will now turn into 100 years of fail.

Trackbacks/Pingbacks

  1. Insert “Fish or Cut Bait” Joke Here | WNYmedia.net - July 16, 2010

    […] Accountability Initiative issued a report critical of the incentives being offered to Bass Pro. Earlier this week, the New York Power Authority cut a deal with the Erie Canal Harbor Development Co…, enabling the ECHDC to raise $105MM for the project through […]

  2. A Bad Week | WNYmedia.net - August 4, 2010

    […] a difference three weeks makes. On July 14th, Chris Collins was talking up the renaissance of Buffalo that is happening right now in front of us, that we can see with our own […]

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