With All Due Respect

[A version of this post appears in the March 19, 2015 weekly edition of ArtVoice under the title “The Boom, Busted” at http://artvoice.com/issues/v14n11/news_feature.]

We are repeatedly told that Buffalo is undergoing “a dramatic transformation” and experiencing an “economic rebirth” and “building boom” not seen in decades. These self-serving pronouncements are premature and overblown, whether made by the local press, Gov. Andrew Cuomo, or his legion of yes-men (and women) such as Howard Zemsky, CEO of the Empire State Development Corp.

As veteran reporter and Investigative Post founder Jim Heaney observed recently: while Buffalo was in the midst of its “building boom” last summer, the Queen City had 4 construction cranes piercing the sky; Toronto had 154.

More troubling than the Cuomo administration’s hyperbole is the campaign suggesting that the governor’s “Buffalo Billion” tactics should be used as a role model for all of upstate New York. According to Mr. Zemsky, communities need to “learn the lesson of the Buffalo Billion” and transform their economies to be self-sustaining through “real investments that actually create jobs.”

Unfortunately, the true lesson that the public should take from Buffalo’s so-called “economic rebirth” is profoundly troubling and anything but exemplary.

Western New York’s “building boom” rests on a dubious foundation. Three symbols of Buffalo’s “turnaround” – RiverBend’s Innovation Hub at the Outer Harbor:

Model of “Innovation Hub” at RiverBend

Uniland Development/Delaware North’s mixed-use tower at 250 Delaware Avenue:

and Terry and Kim Pegula’s HarborCenter project on the former Webster Block in downtown Buffalo:

share two troubling traits:

(1) The government decision-makers “fast-tracked” their approvals by circumventing SEQRA’s Environmental Impact Statement (EIS) process. The EIS is “the heart” of SEQRA (the State Environmental Quality Review Act). When done correctly, the EIS provides a “hard look” at the potential significant adverse impacts of a proposed action, and a detailed description and evaluation of reasonable alternatives and mitigation measures. Importantly, it offers the public a meaningful vehicle for input by mandating a minimum 30-day “public comment period” at an early enough stage in the planning process that true flexibility exists.

[Graph prepared by Arthur J. Giacalone and James A. Giacalone]

(2) Large sums of taxpayer money and “corporate welfare” have been allocated to the three projects. The State of New York intends to invest $225 million in the Innovation Hub project to provide roads and infrastructure at the site, construct the first two of six buildings, and purchase and own expensive scientific equipment. The Erie County Industrial Development Agency (ECIDA) has agreed to provide billionaires Terry and Kim Pegula an incentive package of nearly $37 million for the HarborCenter development, a 19-story, 650,000-square-foot project, including $28 million in property tax breaks over ten years, $7.5 million in sales tax relief, and $1.2 million in mortgage tax breaks. Additionally, the HarborCenter developers can anticipate receiving $20 million in brownfield-related tax credits for spending $8.7 million to clean up the former parking lot site. Not surprisingly [see the note below], Gov. Cuomo used his influence to make certain that the Jacobs – another billionaire family – obtained a controversial $807,000 in sales tax relief from the ECIDA to subsidize the two-and-a-half block move of the Delaware North Companies’ headquarters from the Key Center in the 500 block of Buffalo’s Main Street to 250 Delaware Avenue. Uniland Development, Delaware North’s partner in constructing the 12-story, 472,320-square-foot mixed use development (with 4-story parking ramp) at the corner of Delaware Ave. and Chippewa Street, obtained $3.2 million in real estate tax relief from the ECIDA.

Note: The Buffalo News reported in 2013 that Gov. Cuomo had received political donations totaling $105,026 since 2006 “from either Delaware North or members of the Jacobs family.”  

The most prominent example of an economic development process that should not be replicated is the Innovation Hub at RiverBend. The governor has promised $225 million – nearly one-quarter of the so-called Buffalo Billion – to this one project. In order to ensure a quick, pre-election start to the centerpiece of Mr. Cuomo’s redevelopment campaign, the College of Nanoscale Science and Engineering (CSNE) – an arm of the State University of New York – allowed construction to proceed on the 90-acre, nearly 1 million square-foot manufacturing and research-and-development complex without preparation of an Environment Impact Statement.

SUNY’s CNSE disregarded SEQRA’s presumption that the comprehensive environment assessment mandated by the EIS process is required whenever a proposed project meets any one of the thresholds for what SEQRA calls a “Type 1 action.” Two of those thresholds are particularly relevant here. The Innovation Hub project involves the physical alteration of 90 acres of land, which is nine times the 10-acre threshold for a “Type 1” action. It also entails the construction of nearly one million square feet of buildings – more than four times SEQRA’s 240,000-square-foot threshold triggering the presumption that an EIS be prepared.

The Cuomo Administration sidestepped its role as steward of our environment despite the RiverBend project’s location along the Buffalo River’s highly sensitive “Area of Concern” [AOC], one of the most toxic hotspots in the Great Lakes region. Buffalo Niagara Riverkeeper, the current AOC coordinator, diplomatically expressed the following concern last May when identifying potential policy “barriers” to accomplishing the goals of the Buffalo River’s Remedial Action Plan [RAP]:

        “Redevelopment planned along the Buffalo River corridor needs to be better integrated at all planning levels with the restoration investments made through the RAP process to date. This will ensure that adequate site-level policies and protections are in place for long-term RAP delisting goals. “

In November 2013, when Gov. Cuomo announced the State’s plan to invest $225 million in the Innovation Hub project, Howard Zemsky, in his capacity as co-chair of the Western New York Regional Economic Development Council, made the following proclamation: “The Buffalo Billion is intended to be transformative. We’re the capital of clean energy in New York State.”

It is rather ironic – if not perverse – that Cuomo and Zemsky have chosen to transform Buffalo into “the capital of clean energy” by ignoring SEQRA’s comprehensive environmental review process. SEQRA was enacted in the mid-1970s to prevent future development from repeating the environmental devastation that eventually led to designation of the Buffalo River’s “Area of Concern” and decades-long remedial action. The decision to place RiverBend’s Innovation Hub in a highly sensitive area along the Buffalo River prior to conducting the proper environmental review to determine if the site is appropriate for such activities is, at a minimum, indefensible and irresponsible. We cannot rationally and responsibly research, develop, and manufacture “clean energy” products if the process of doing so harms the surrounding environs, which includes the Lake Erie shoreline.

Neither the environment, nor New York’s taxpayers, can afford to use the Buffalo Billion or the Queen City’s “economic rebirth” as a role model for future development.

With All Due Respect,

Art Giacalone