In 2003, a colleague, Patrick Lakamp, and I did an investigation of the state Empire Zone program, the state's major economic development program. We found that a program intended to promote investment and job creation in distressed areas, including inner-city neighborhoods, had instead been used in Buffalo largely as a tax-abatement program for downtown business interests.
One could make an argument that the misuse of the Empire Zone program has helped make Buffalo the second-poorest city in America.
The list of companies cashing in reads like a who's who of corporate Buffalo. Rich Products. HSBC Bank. Delaware North. The biggest beneficiary was M&T Bank, which, by our calculations back in 2003, was scheduled to enjoy some $17 million in assorted tax breaks and tax credits over a 10-year period. According to more-recent data, the bank enjoyed $1.3 in Empire Zone benefits in 2006, the last year for which data is available.
I bring all this up because Bob Wilmers, M&T chairman and CEO, was announced Thursday as the new chairman of the Empire State Development Corp.
On one hand, this is good news, to have someone from the region heading up the state's economic development arm. And make no mistake, Wilmers and M&T have been strong advocates for the region and, in many ways, good corporate citizens.
Wilmers and his bank added hundreds of jobs downtown, bolstering confidence at an important time. They've given money to worthy community causes, from the Westminster Charter School to Shea's Buffalo. And Wilmers has been a leading spokesman for changes in the state's tax and business climate, many of which are on target. Not everyone is thrilled with him - municipal unions, in particular - but you can't say he hasn't hasn't been civically engaged.
But the appointment begs some questions:
-- Does his appointment pose a conflict of interest, as he will now head the agency that dispenses tax breaks to his company? For that matter, do his business and political entanglements with business executives and politicains permit him to be an honest broker among the many interests competing for state assistance?
-- He's been a major power in the Buffalo Niagara Partnership for years, an organization whose mission includes promoting economic growth in the region. Given the state of the local economy, does the Partnership's track record make Wilmers worthy of a promotion to oversee the entire state economy?
-- Are we better off with a banker or a seasoned economic development professional like the departed Dan Gundersen?
People, weigh in.
taggedEconomic Development | State government | Subsidies