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Legislature passes development corporation in 9-5 vote

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    The county legislature approved the formation of a nonprofit local development corporation in a 9-5 vote Wednesday.
  • Empty
    The county legislature approved the formation of a nonprofit local development corporation in a a9-5 vote Wednesday.
November 8, 2018 02:17 pm

CATSKILL — A proposed nonprofit local development corporation designed to secure state funding was approved by the full Greene County Legislature in a 9-5 vote Wednesday.

The vote was postponed at the legislature’s Oct. 17 meeting.

Proposed formation of the corporation comes in response to the county having to use $850,000 in state Community Development Block Grant funds by March 31, 2019.

The state is requiring all municipalities that use Community Development Block Grant funds to convert the loans to cash and use the money for eligible projects by the end of March.

Revolving loans are awarded to businesses and paid back to the county, so that the funds can be distributed to future developments.

“If we don’t use the money or transfer it to the development corporation, it goes back to New York State Community Renewal,” Tourism and Economic Development Planning Director Warren Hart said Oct. 16. “If we don’t create the corporation, we won’t have access to block grants in the future.”

Before Wednesday’s vote, Legislator Lee Palmateer, D-Athens, opened the floor to discussion.

“We’re creating a powerful real estate development corporation and we’ve made no case that we need one,” Palmateer said. “If we make one, we should create one with specific purposes. It should only operate the loan fund, not buy properties.”

The corporation would allow the county to continue using revolving loans, apply for grants as a nonprofit, and rent and develop properties, Tourism and Economic Planning Director Warren Hart said Oct. 15.

“These are common tools for the county to use,” Hart said.

“Is there any way to keep the money in the county?” Legislator Aidan O’Connor Jr., D-Durham, said.

“No,” Hart said. “We have to liquidate the funding by giving out grants by April first… We have to have it [the corporation] to apply for new funding. It is the only way to stay in the state revolving loan fund. ”

Bulich shared Palmateer’s concerns about the corporation’s powers.

“I think it should be a simple corporation with one purpose,” Bulich said. “It should meet the minimum standards and be a see-through company. It should satisfy the state requirements and that’s it.”

Hart named some of the projects that the Block Grant Program has made possible in the community, such as Crossroads Brewery, New York Zipline Adventure and the rebuilding of the Blackthorne Resort in Durham after part of it was destroyed by fire.

“The corporation would allow uses for activities consistent with the scope of the county,” Hart said.

A rigorous review process lies ahead for the legislature, Hart said.

“The next step would be bringing the bylaws before the legislature and then you get to pick the board,” he said. “It’s not a stand-alone entity. It functions in tandem with us. We’re putting in many checks and balances.”

Any changes made to the bylaws by the corporation’s board will have to come back to the legislature for review, Hart said.

“That’s easy for you to say and give us a sense of security,” Palmateer said. “I think we’re trying to have our cake and eat it, too. We’re putting blinders on and not taking responsibility for creating a corporation.”

Palmateer inquired about the manpower necessary to run the property development aspect of the corporation.

“At what point does it start sucking away the county’s resources?” he said.

Hart did not see the county getting significantly involved in that portion.

“If we develop one or two properties a year on top of handling the loans, that’s a good year,” he said. “I don’t see us as property managers.”

Bulich had reservations about the concept of the government loaning money for development at all, he said.

“Why is the government loaning economic money?” he said. “That’s the bank’s job. We need to limit the scope right now.”

“I would not suggest limiting it to only loans,” Hart said. “The corporation can be used in other capacities.”

Legislator Kevin Lennon, D-Catskill, expressed concern over which businesses would receive funding.

“You mention Blackthorne, and Ms. Handel was a sitting legislator,” Lennon said. “There are other businesses that burned down that we could have helped.”

“No, she wasn’t,” Legislature Chairman Kevin Lewis said. “Get your facts straight.”

Legislator Harry Lennon, D-Cairo, did not appreciate the insinuation.

“I don’t like what you’re saying,” he said. “I’m not going to sit here and be accused. You should be ashamed.”

“The funding is open and available to anybody,” Hart said.

Legislator William Lawrence, R-Cairo, asserted his faith in the corporation.

“I trust Warren and [Greene County Administrator] Shaun [Groden] to keep track of it and I support it 100 percent,” Lawrence said.

Legislators Lawrence, Harry Lennon, Patrick Linger, R-New Baltimore, Matthew Luvera, R-Catskill, Charles Martinez, R-Coxsackie, O’Connor, Linda Overbaugh, R-Catskill, Lori Torgersen, D-Windham, and Lewis, voted in favor of the corporation.

Lawmakers Bulich, Thomas Hobart, R-Coxsackie, Kevin Lennon and Palmateer voted against the formation of the corporation. Legislator Larry Gardner, D-Hunter, was absent. Absences are counted as no votes.