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January 21, 2011 - 3:45pm

GCEDC releases consultant's salary survey

posted by Howard B. Owens in GCEDC.

At the request of The Batavian, the Genesee County Economic Development Center sent over a one-page summary of a compensation survey completed in 2008.

The survey gathered compensation information from 26 IDAs from across the United States, comparing budget, staffing and executive compensation.

Handwritten notes on the summary indicate GCEDC CEO Steve Hyde earned a base salary of $134,550 and the average salary of the 26 agencies was $148,000, with his total compensation set at $171,600 compared to an average of $166,600.

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Chris Charvella
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Ames, Iowa: M Median household income: $47,330 Home Value: $173,619 Bismarck, ND: Median Household income $48,961 Median home value: $169,227 Corpus Christi, TX Median household Income $65,512 Median Home value: $149,900 (even the foreclosures in Corpus Christi go for 116K) Batavia, NY: Median household Income: $33,484 Median home value: $81,600 You guys starting to get the picture? I'm not going to muck through all 25 on the list (some of which are not public IDA's but private companies) but for some reason, Genesee County is being compared to IDA's in areas with ten times our population, a huge tax base and a populace that doesn't vomit when they find out that the IDA director's bonus was twice what their family makes in a year.
James T. Hansen
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At least those other towns got something for those high salaries. Naperville was one of the fastest growing towns in the country.
Mark Potwora
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you make a great point Chris...
Mark Potwora
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Chris you make a great point...It is issues like this that have caused the TEA PARTY to grow in numbers..People have had enough of these government officals taking tax money and living an elitist life style..Were is the accountability..Why does the county just keep handing money over to them never questioning the pay that those at the GCEDC get..But yet we have to cut jobs at Genessee Justice...
Ken Rumble
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Very good post Chris. What I really think is JUSTIFY all of the pay and bonus for all of the people in this organization. With the economy and the fact that if a BONUS is given why isn't it based on performance? How many good jobs have been created? Not minimum or just above minimum wages. All these "shovel ready" sites in the county can be created, doesn't mean anybody will build in them. Show me these good paying large number of jobs. They don't exist.
Daniel Jones
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Mark and Chris - Speaking analytically, this event is causing some very strange allies. It's really so outrageous that progressive Democrats like you Chris and Tea Party Republicans like you Mark are rallying together. I think that this could drive the conversation towards transparency as a relevant local issue, which is something that I think that progressives and tea partiers can agree on. I hope to see candidates run on that issue this year.
Chris Charvella
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Dan, I think you're half-right. It may be uncommon for guys like Mark and I to be on the same side of an issue, but I think we both have the capacity to recognize when something is just wrong at its core.
JoAnne Rock
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I definitely get the picture Chris! I decided to "muck" through the list, which is actually only 17 respondents, and this is what I found: First, a couple of definitions are necessary...as determined and defined by the OMB: MICROpolitan Statistical Area...must have an urbanized area (city) with a population of at least 10,000 but fewer than 50,000. They must be at least one county and most are. The OMB has identified 576 MICROS in the United States for 2010. METROpolitan Statistical Areas...must have at least one urbanized area with a population of at least 50,000, plus adjacent territory (counties) which have a high degree of social and economic integration with the core as measured by commuting ties. They must have at minimum one county but most often include several counties. The OMB has identified 366 METROS in the United States for 2010. Batavia is a MICRO. Of the 17 respondents to the survey: *2 are private corporations and 2 are non-profits *EVERY SINGLE ONE of the remaining respondents are METROS Their method of compensation comparison is the occupational equivalent of a line cook surveying the salaries of executive chefs throughout the US in order to determine what he/she should be earning...apples and oranges. Wouldn't it have made more sense to compare the compensation of other MICRO entities? Then, there is GCEDC's claim: "The Agency has consistently received national acclaim for strong performance helping Genesee County and the Batavia Micropolitan area achieve Top 10 Micropolitan status in the nation for economic development activity for the last 6 years in a row as measured by Site Selection Magazine." There are several problems with this claim. 1. Site Selection Magazine ONLY ranks MICROS by "total number of projects". The ratings have nothing to do with economic results, good or bad, realized or not. That's kind of like trying to judge the quality of a race horse by how many races he has entered with no regard as to it's performance in those races. http://www.siteselection.com/issues/2009/mar/top-micros/ http://www.siteselection.com/issues/2010/mar/top-micros/ 2. Site Selection Magazine is a tool for those looking for a site for their business and for economic development agencies to promote their communities. Yet in the community detail for Batavia, the GCEDC is not even listed as an agency for Batavia. Instead, Rochester and Buffalo agencies are listed. If you click on the link looking for available business properties in Batavia...it takes you to Buffalo. 3. The site lists Batavia's Job Growth Rate as -4.7% and our unemployment rate as 8.4%. Kind of hard to believe for a community that supposedly ranks in the top 10 in the nation! I found another site that ranks the economic strength of all the MICROS in the US by compiling relevant economic data. http://www.policom.com/PDFs/EconomicStrength2010.pdf None of the MICROS on Site Selection Magazine's list were in the Policom top 10. According to Policom, Batavia's 2010 economic strength rank is 164 (out of 576). In 2009: 134, 2008: 120, 2007: 137, 2006: 149, 2005: 157, 2004: 222 Did anyone really believe we ranked in the top 10?
Chris Charvella
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Thanks JoAnne, I got so disgusted after doing the first four on the list that I couldn't justify getting my blood pressure up over the rest.
JoAnne Rock
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Your welcome Chris. I find transparency to be very therapeutic...:)
Sean Valdes
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Can someone explain, or link to a site that explains, how GCEDC is funded? I understand the public funding aspect, but I don't get the private side? Isn't all the money that comes through the GCEDC public money? What income would it have that isn't generated by some sort of government subsidy. Thanks for your help!
Lorie Longhany
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delete
Howard B. Owens
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County, grants & fees (the companies that get tax breaks, as I understand it, pay some percentage of their capital investment as a fee). I'm not entirely 100 percent clear on that.
JoAnne Rock
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That is a good question Sean. Even if some of the income is from private sources, wouldn't all of the funds, once received by the GCEDC, be considered taxpayer dollars?
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I thought it was interesting that this report was compiled by a company (Jorgenson Consulting) that advertises itself primarily as an executive 'headhunter' for IDAs and chambers of commerce.
Howard B. Owens
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A reader sent this in: "I wanted to clarify how the GCEDC receives "private" funding. The EDC uses all their "tools" to reduce the cost of business for a company. After doing this they give an estimated savings figure such as $500,000 to the company. The company then pays a percentage of that to the EDC as a consulting fee. The problem is that the EDC is one of the only entities that can eliminate sales tax, property tax, and just about every other type of tax. So the more of the tax base they take away from the federal, state, and local governments the bigger their payment from the company is."
Bea McManis
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The plot thickens!
Terry Cotler
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The Nixon "I'm not a crook" You Tube clip... So hilarious! I can,t help but wonder if this is not the 1st time that Mr. Hyde has been in this situation... Hopefully it will be the last for him in Genesee County... These people and those who protect them need to be swiftly removed from their positions...
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To echo Chris, yes, thanks JoAnn for your research. You make some great points, it seems you and I don't often agree either, but I believe your research a lot more than anyone's who is complicit in this. You ask: "Did anyone really believe we ranked in the top 10?" I scratched my head every time that has been bandied about. So, I suppose we are all a little to blame for not asking questions and shining a light on this a long time ago. I, as do i think most folks, try to trust in our elected representatives to do the right things and time and time again we get suckered. Also, thanks to the reader who clarified the so-called private funding shell game for us.
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I can't imagine anyone not being outraged by this. You are right, Dave, no one who has any ounce of awareness could see we aren't getting the bang for the bucks shelled out to those entrusted with the responibility to entice business to Genesee Co. Sadly, this will only put another nail in the coffin for support to find a qualified, proven person who will shine the spotlight on Batavia and Genesee Co. Our elected official didn't see the need for oversight? WTH is with that?
Daniel Jones
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All that I hear from our current crop of legislators is passing the buck, they let out a cry of 'not my responsibility', well, when our tax money is involved it is their responsibility. They should have been pressing Hollis Upson for information and Hollis should have been more forthright about that information. Legalities aside, that amount of money is too much for the economic development done and for the income of this area. I do not see enough economic development to justify that kind of salary. I think that given the responses of the people who comment here from across the political spectrum, it's easy to say that I am not alone in this position. In the past (a few years ago) I had supported the GCEDC, however, given the information that I have learned over the past few years that support has ended. The GCEDC, as a public entity, has failed the public and in the process so has the county legislature. It's time for each and every county legislator to man and woman up and admit responsibility. Next they need to take corrective action and replace Mr. Upson as their representative on the board. As long as tax dollars are involved oversight is needed.
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Howard, So if I understand what you posted from a "reader", The GCEDC helps a company to not have to pay taxes? The more taxes that the GCEDC helps the company to avoid, the bigger the payment that the company pays to them as a consulting fee? So what I would like to know is how exactly is the GCEDC helping Genesee county out?
Jennifer Keys
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I’ve been debating all day as to whether to comment during the first GCEDC discussion. I was concerned because what if as an elected official I had made such mistakes. But then I logged on again this evening to find two more blogs about this issue and was astounded by the remarks and actions of those involved. We all make mistakes; after all “to err is human,” in my estimation, though, it is what we do with those mistakes that counts the most. Mr. Upson made some reference to the overwhelming majority of the top paid public officials in the county are in education. Yes, they are. It is their job(s) to ensure the education of our children/grandchildren. In other words, they help to ensure our future is bright! Unless you’d like to return to feudal times when education was not public and you were not able to better yourself beyond the class you were born into, then we will need to pay for education. In addition and more importantly, this debate is not about the salaries of the educational administrators in our county. This debate is about government accountability, such as the accountability of our elected officials to tax payers in this county even when they are serving as liaison to boards. At a time when the director of Genesee Justice, a nationally recognized program, decided it was better to resign than to see the program shut down due to economic difficulties in the county, it is unconscionable for others receiving the same county funds to take bonuses that would be enough to keep some of the unemployed in our county afloat without using unemployment benefits. This is a time of economic hardship when many are not receiving performance based raises, but are happy to still be employed; this is true of the private sector as well as the public. Is it true that GCEDC has created only 50 jobs in our county? While that is 50 jobs more than we used to have, I do not see where that puts enough money back into our coffers to make up for the bonuses given in this agency. Didn’t I also read that these bonuses were given based strictly on the availability of extra revenue? Why wasn’t that revenue given back to the tax payers who helped to fund this venture to begin with? If I understood her correctly, Ms. Hancock made a reference to the GCEDC board not being accountable to the County Legislature until (re)appointment time. If that is so, then the county has no recourse to replace members who are not performing their duty or who engage in misconduct? How can we not be responsible for those we appoint? It sounds to me like buck passing, rather than stepping up and admitting that mistakes were made and discussing the corrective action that will take place. We live in a public world. It is easy to get access to anything, especially issues of government. Why not admit mistakes and make plans to correct them? It seems to me, and do correct me if I'm wrong, that there has not been much change in the make-up of the legislature for some time. The legislature comes up for re-election this fall. If you are not happy with the decisions that have been made lately or the responses when poor decisions are outed, please, please, please throw your hat in the ring or encourage someone who’s qualified to do so. As eluded to in an earlier comment, I am sure that there are many qualified people out there who do not run for public office because our county is overwhelmingly registered Republican and they feel they do not have a chance. To that I say, what is democracy without debate! Thanks for reading.
Daniel Jones
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Jennifer - Great post.
Bea McManis
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Jennifer, You laid it on the line. Put on your armor because you are sure to get a few arrows headed in your direction. That said, you are absolutely spot on. You mentioned Genesee Justice. The money spent on bonus to GCEDC might have made the difference in keeping that agency whole with a good person at the helm. Thanks again for a great post.
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What $60,000.00 can REALLY do for economic development in western NY: http://thedailynewsonline.com/news/article_d7e98c60-25e5-11e0-8bc0-001cc...
Kevin Squire
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I would like to hear what our other elected legislators have to say about this "situation".
Sean Valdes
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I agree Kevin. I would also like to hear from Mr. Hyde and Mr. Andrews at GCEDC. I admire and respect both Legislators Hancock and Upson, but if the quotes in The Batavian's previous story does in fact represent their views on this issue, then they are wrong. The GCEDC system, as it has been described over the last few days on the Batavian, makes me concerned about our County government.
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It seems that excessive bonus payments and vaguely defined guidelines regarding bonus payments is not restricted to Genesee County. I found an article about the Greene County IDA executive and his $175,000 bonus pay. http://www.thedailymail.net/articles/2010/10/06/news/doc4cabfe26dcb97484... The State ABO report for Greene reads like a copy of the one for Genesee. I wonder how many other counties received similar reports. It might be that there is a state-wide problem with local legislatures failing to monitor their respective IDAs. Basically, a county legislature is a county legislature is a county legislature.
Peter O'Brien
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I'm not outraged and I'll tell you why. Its too small to make a major difference. I think there are far more important issues to me then the salaries of the GCEDC board. Those salaries get spent and if I am not mistaken thats why we needed to extend unemployment benefits, right Ms. Pelosi? What were the board members doing before they were on the board? What were there salaries then? People won't just come to the a board like this and not expect to at least make the same money. So if you want the most prominent business men in the county, you need to pay them for their time. You can compare their salaries to other IDAs but thats apples and oranges. The correct comparison is are they making significantly more then they are worth. And their worth (at least to them) is not defined by they have accomplished It is defined by what they would be worth to a private business. I'm not saying that I agree with their salaries, I just want point out how I look at this which seems to be far more related to logic then the emotional cry of "That Rich Guy is Screwing US!" Let me ask you one thing. What will you get out of lowering their wage? Nothing. You might feel good about it but in the end it will not do anything to boost you up, it will only tear someone down. And it may cost you a future job. Edit: I fully support complete dismantling of the Agency. If a small business has to work through all the taxes of this state, then larger businesses with lobbying power should also.
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I would support full dismantling of the agency, except that every other county and metro area has one. Maybe that could be a selling point for Genesee County. Unfortunately, unless all EDC's in NY state are shut down, I think the reality is that we will have one too. For the record, i'm for all EDC's being closed down.
Howard B. Owens
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The board members are not paid. They are volunteers. The staff is paid.
Peter O'Brien
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Well same applies for the top end of the staff
Marie Smith
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Peter, I could see paying that salary for Mr. Hyde if we were getting great results in Genesee County. But as I have said before show us the results. And doesn't anyone else find it EXTREMELY disturbing that the survey that was looked at for comparison for Hydes salary was PAID for by the GCEDC. Hmmm if a company is paying for a survey, of course you are going to get the numbers you want, AND WE paid for a survey to justify the negotiation of his salary. It seems to me like there should be some checks and balances put into place over at the GCEDC. If Genesee County was booming with business and the unemployment rate was non existent then we wouldn't be having this conversation. BUT guess what I do not see booming business and an over abundance of available jobs. Maybe his bonus should be based on that!
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Marie, My point was only that people want the best but are never willing to pay for it. Someone had to think he was worth it in order to give him the money. That someone more than likely has a lot more information than we do. We don't know how crucial Mr. Hyde was in bringing the business here that has come. Knowing that this agency is in the public spotlight only makes me think that those who approved the bonus were smart enough to know how it would be viewed (I would hope). To me this is like a salesman getting a commission. He made the GCEDC lots of money so he gets a cut as a thank you. When it comes right down to it he is a highly paid used car salesman. He wants to get the biggest perceived tax cuts for his car buyer in order to have that buyer walk out with the car. In doing so he get a portion of what is paid to the dealership. Its how business has been done for centuries and frankly I don't think it needs to be changed (the business model that is). But the GCEDC exists. In so doing it creates an unlevel playing field for businesses fighting for dollars that are harder to entice out of peoples pockets. Do you think Walmart would not have come to the area if it got no incentive? No it would have awyways. But the Town of Batavia saw an opportunity to make money if it gave Walmart a break and said "Build Here!". That mentality isn't wrong in the private sector. But it is in government. Government is in place to provide equity to all. I'm sure that Adam Miller Toys would like the same tax breaks but my bet is they won't get it.
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I understand the business model very clearly becuase I was in sales. And I remember if I didn't meet my sales goal guess what, no bonus, and lower commission. What I am saying is they said the bonus was not based on the company successes. So where are the millions of dollars that Mr. Hyde has brought into Genesee County to deserve that bonus. If he has then more power to him, I am willing to bet he hasn't, as a matter of fact I know he hasn't. All I am saying is maybe instead of saying oh people that know more than us made those decisions and hopefully made the right decisions. Maybe we need to make sure that people are held accountable for the job they are supposed to do. And if that job isn't met at the end of the year I don't feel a $60,000 bonus should be awarded "becuase the funds were there".

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