News roundup: City could tap into stimulus package for $4.5 million
Batavia's City Council voted in favor of a measure last night that would use $425,000 to "design work for a half dozen" infrastructure projects, WBTA's Dan Fischer reports. That investment of $425,000 is supposed to yield $4.5 million worth of construction, on projects such as: undersized water mains, waterline break history, inoperable valves, sanitary sewer line conditions and road conditions.
Fischer explains that the $425,000 would be part of the aid received by the city from the Video Lottery Terminal Aid that was received earlier this year.
Councilman Frank Ferrando is quoted in the Daily News this morning as saying: "If we can get $4.5 million to get jobs that we have to do and can get it for an investment of $425,000, I think we have to do it,” he said. “There’s going to be a lot of money out there."
No one, however, explains how any of this would work. In fact, rather than explaining it, the article today in the Daily has only this to say:
It is a gamble. Assistant Manager Sally Kuzon said there’s no guarantee of the city actually getting the money from the state Economic Facility Corp. But spending $425,000 to design those six projects is a move toward it, she said.
It's a gamble!? So the city plans to gamble with gambling money. A little irony, perhaps. Furthermore, where did the state Economic Facility Corp. come from? No one is explaining this to us, folks. All we hear is Frank Ferrando saying: 'Hey, we can turn $425,000 into $4.5 million. Poof! We're rich and we have jobs. How can we not do this?'
What everyone has failed to note is that the hoped-for millions that would magically be available if only the city spent this $425,000 are part of the proposed economic stimulus package that just last night was the subject of a national news conference.
From a letter drafted by Assistant City Manager Sally Kuzon:
I have been monitoring the progress of the President's proposed Economic Stimulus Package over the last several weeks in an attempt to place the city in a competitive position to receive funding for infrastructure improvements.
Kuzon goes on to say that while there has been "tremendous debate" over just what will happen with the stimulus, she believes that "infrastructure improvements nationwide will have a prominent position within this initiative." In other words, the city should get it on it. We should submit "shovel ready projects" to the state's Economic Facility Corp., which will adminster the federal funds allocated to New York.
Although there is a certain amount of uncertainty as to whether or not the programs will include loans or grants or whether the program will extend to projects not currently listed on the (Intended Use Plan); it is clear that only shovel ready projects submitted to the EFC will be considered for the current or future funding rounds. Based on this premise, I am recommending several projects for Council to consider submitting tothe EFC for economic stimulus funding.
We mentioned some of those projects above. The $425,000 requested by Kuzon would be used to design the projects and submit the designs to the state so that they would be eligible to receive the funding if and when it became available. However...
It is unknown at this time if the design phase or only construction cost will be eligible for reimbursement. If for some reason the city does not receive economic stimulus funding the projects will be designed and ready for construction as funds or grants become available in the future.
In a letter drafted to the City Council on Kuzon's proposal, City Manager Jason Molino writes: "The crux of this stimulus package is to get people back to work receiving pay checks; with $4,500,000 of infrastructure improvements that goal will be acheived."
Nowhere does anyone explain how these infrastructure improvements will acheive the goal of "getting people back to work." Kuzon never once takes up this issue in her letter, and nothing from Council addresses this either. We only hear people tell us: It will happen.
Molino justifies this use of these funds in this way:
Utilizing a portion of this years (sic) VLT aid to support the project design costs is both appropriate and realistic considering the City did not budget for this one-time revenue and these costs are one-time capital costs.
Council President Charlie Mallow can be heard in an audio quote on WBTA as saying that Batavia needs to do this. Otherwise, the jobs will go to New York City. He wrote to us in an e-mail this morning:
The action council took last night was about job creation right here in Genesee County, instead of New York City. Regardless of how we feel about the spending on the national level, we owe it to our residents to secure our share of this huge stimulus package. We are all going to pay for it whether we have enough foresight to act or not on a local level.
We're waiting to hear back on how this will create jobs. See below.
Click here to download the letters by Molino and Kuzon, along with descriptions of the infrastructure projects noted in the proposal.
Councilmen Sam Barone and Bob Bialkowski were the only two members of Council who voted against the measure, saying that the state aid could be used instead to reduce the city's deficit or for "future needs."
Updated (8:28 a.m.): Council President Charlie Mallow responded to our question of how this stimulus money would create jobs.
Any aid we receive needs to be spent on projects that are shovel ready and can break ground in 180 days. That means putting people to work this summer. Local construction workers would be the first ones to work or to keep on working. Then there is the trickle down affect with people who work driving trucks, making concrete, selling building supplies, laying pipe, and even restaurants the workers, etc. We as a local government decided to do what we needed to do so that our people would feel the benefits of these make work projects that will be going on around the country. I believe this depression era type projects will boost our economy up and out of the slump we find ourselves in.
If fully funded, these projects will rebuild parts of 11 streets in the city this year. These projects are for sewer, water, road surface and sidewalks, and most call for complete reconstruction. This work will be on top of the work being done on Walnut, Oak and the $150,000 of sidewalk repair already budgeted this year. There will be a lot of activity going on this summer to rebuild the city from the ground up.
Update (8:35 a.m.): A very timely headline in the Buffalo News this morning reads: New York loses millions in revised Senate stimulus bill. From the article:
Gone entirely is funding for higher education construction, which, under the House-passed version, could have meant up to $242 million for the University at Buffalo.
Similarly, the Senate eliminated funding for school construction. The House bill would have provided $31.9 million for the district of Rep. Brian Higgins, D-Buffalo.
Senators also halved a $79 billion fiscal stabilization fund for the states. While much of the aid to local school districts remains intact, the cuts included a $25 billion fund aimed at helping governors balance their budgets.
Will we see even more funds cut from the stimulus by the time it is passed?