Tech park dreams not quite reality
Inside the Luther Forest Technology Campus, miles of new road are as wide as an interstate, neatly striped and nearly pristine. But their unblemished condition masks a troubled future for the LFTC.
The LFTC Economic Development Corp. is supposed to pay the town of Malta nearly $400,000 a year to maintain those 5.5 miles of road, but the troubled nonprofit corporation is two years behind on those payments.
Malta’s leaders want someone besides taxpayers to pick up the road maintenance bill, but beyond that, they disagree. Town Supervisor Paul Sausville thinks future road bills should go to GlobalFoundries, the park’s only tenant — though a big tenant, building the biggest factory complex upstate has seen in decades.
“What’s happening at the campus is they are consuming all the oxygen in the room,” Sausville said.
GlobalFoundries, which is contemplating whether to spend nearly $15 billion on a second semiconductor plant, doesn’t want responsibility for the roads, and most of the Town Board agrees with the company.
“I oppose it on the basis of fairness to GlobalFoundries,” said Town Board member Peter Klotz.
There’s some support within the Town Board for taking the LFTC corporation to court — though that might drive the corporation into bankruptcy, which wouldn’t be good for anyone.
“I think we need to consult more with legal counsel to understand what our options are and what the consequences might be of our action,” said Town Board member John Hartzell, himself an attorney.
And that’s where things stand. There are no signs of a resolution,
The road funding dispute adds another point of uncertainty to what has become a precarious situation for the technology campus, less than four years after most of the infrastructure construction for what is supposed to be a world-class place to do business.
With Gov. Andrew M. Cuomo criss-crossing the state, touting his “Tax-Free New York” proposal as a new way to aid upstate economies, it’s worth looking at how the technology campus is faring: A decade ago, it was the shining dream of two other men who brooded over the upstate economy, former state Senate leader Joe Bruno and former Gov. George Pataki.
The enormous 1,414-acre industrial park in the Luther Forest woods was the brainchild of the Saratoga Economic Development Corp., and the plans were then pumped full of money by Bruno and Pataki. More than $100 million of state money went directly into buying land and building the park, to say nothing of the $1.4 billion incentive deal that lured the computer chip plant.
But all of the planning seems to have been done on the assumption that the state’s financial support would be endless. It hasn’t been. State cash dried up when Democrats took over the governorship and Bruno left office in 2008.
The LFTC corporation, hampered by the Great Recession and a town law prohibiting the use of property tax breaks to lure new business, has been unable to sell any more land since the state’s Empire Zone incentive program ended in 2010. It has no other sources of revenue, which is why the road maintenance bills haven’t been paid.
GlobalFoundries is currently going through the Saratoga County Industrial Development Agency to finance $70 million in off-site infrastructure work backers originally thought state funds would pay for.
“The system that originally brought [GlobalFoundries predecessor] AMD to the area is broken,” said Steve Groseclose, GlobalFoundries’ director of risk management, sustainability and real estate.
GlobalFoundries will have spent about $8.5 billion by the time its Fab 8 plant and a technology research center, now under construction, are finished late next year. But the previous investments are no guarantee of future spending, especially when you’re talking about $15 billion.
“Uncertainty is not the friend of major investment decisions,” Groseclose told the Town Board last week. “There’s tremendous, tremendous investment risk there.”
The company has repeatedly emphasized that it’s made no final commitment to build, even as the towns of Malta and Stillwater review GlobalFoundries’ zoning application.
If the second fab is built, the GlobalFoundries workforce would rise from today’s 2,000 to nearly 6,700 — not even counting thousands of construction workers who will have years of work.
That means more traffic, more housing demand, more pressure on farmers to sell their land — all things worth having mixed feelings about, even if you support economic growth.
As Cuomo pumps up new dreams for the upstate economy, it’s worth remembering that reality looks and feels very different from a dream.