Paterson chooses banker as new economic development head

PHOTOGRAPHER: The Associated Press

Gov. David Paterson has chosen a prominent Western New York banker and longtime advocate for upstate revitalization as his statewide head of economic development.

Paterson nominated Robert Wilmers, chairman and CEO of M&T Bank Corp. based in Buffalo, to be chairman of New York State’s economic development agency, the Empire State Development Corp. Wilmers, a millionaire, will serve without pay pending Senate confirmation.

Known for being outspoken against New York government, Wilmers said in Rochester Thursday: “The biggest impediment to doing business in upstate New York is … Albany.

“We have the highest taxes in the country,” said Wilmers, who plans a new structure for the agency. “I believe that 99.9 percent of all government employees are honest, but in having such a huge budget we have a huge bureaucracy, and bureaucracies, by definition, are never friendly.”

The 74-year old executive is a founder of the Unshackle Upstate group and a board member of the state Business Council who has been critical of Albany dating back to the Pataki administration. Wilmers has chastised Albany for regularly spending at twice the inflation rate.

Paterson said Wilmers will be based in Buffalo and will choose an upstate and downstate leader who will report to him.

“Not only is he a successful banker, but he also has a long and impressive record of civic engagement,” Paterson said in a prepared statement. “I’m pleased that an executive of Bob Wilmers’ caliber will be at the helm as we establish a new, unified leadership team that will strengthen the Empire State Development Corporation and bolster the state’s efforts to attract business and spur local development.”

Wilmers plans a new management structure for New York economic development, long criticized as insufficient in creating the jobs promised while providing tax breaks to politically connected businesses.

“With the right business plan and the right support in Albany, we can make New York a leader in attracting new investment and creating new jobs” Wilmers said.

Wilmers will replace Dan Gundersen and Patrick J. Foye, appointed by former governor Eliot Spitzer to run economic development upstate and in New York City, respectively.

Paterson has wanted to return to a system in which one official coordinates economic development statewide instead of the two-leader system Spitzer created. The offices use tax credits and tax breaks to keep employers who are considering moving out of state and to entice other employers into New York. The tax incentives are supposed to create jobs, a measure where much of the state outside New York City and its suburbs has been in decline for decades.

Gundersen resigned Thursday, two months after Foye resigned. Gundersen had been widely praises by upstate officials for his work that attracted several employers and helped some New York businesses expand. Paterson credited Gundersen for attracting 12,963 job commitments and retaining more than 30,400 jobs. He also increased international trade and brought greater accountability to programs such as Empire Zones, Paterson said.

Paterson says one person in charge could avoid counterproductive competition and unnecessary cost. His strategy was at first met with strong opposition upstate, especially from long troubled Buffalo, but was tempered after his latest tour with upstate officials. The visits included one with Wilmers in Buffalo.

“Whoever takes the job has to be ready to make fundamental change,” said Assemblyman Richard Brodsky, a Westchester Democrat critical of economic development during the Pataki administration. “The programs have become enormous giveaways to powerful interests unrelated to any public benefit.”

There was no immediate comment from Senate Majority Leader Joseph Bruno, but Bruno has a record of supporting Paterson’s appointments and Bruno has wanted an upstater in charge of economic development.

The Partnership for New York City immediately supported the choice.

“Wilmers has the experience and relationships to be an effective advocate for encouraging business investment and job creation across the entire state,” said Kathryn S. Wylde, the partnership’s president and CEO. “He knows the issues and can help bring the diverse sectors of the state economy together in a united effort to grow the revenue base of the state.”

Wilmers stepped down as a founding member of Buffalo’s fiscal control board last summer, after the board created to right the city’s finances helped Buffalo generate $186 million in budget savings, improve its Wall Street bond rating and increase its surplus to more than $100 million, according to Buffalo Business First magazine. He had been a member since 2003.

M&T was ranked 496th on the Fortune 500 company list as of 2007.

In 2004, Wilmers offered to finance Buffalo’s search for a new school superintendent and to sweeten the salary so that the best candidates were not lost to higher-paying districts. Wilmers said he would try to raise money from businesses, but would pay on his own if that fell short. He declined to put a dollar figure on the offer. The district declined.

The Buffalo News reported that Wilmers collected $9 million by exercising some of his stock options at M&T in 2007.

Wilmers, a Harvard Business School graduate who worked for former New York City Mayor John Lindsay, also is a big contributor to local and statewide campaigns for Democrats and Republicans, according to state Board of Elections filings. He gave the Spitzer-Paterson campaign $40,000 in 2006 when Paterson ran for lieutenant governor with Spitzer, who Paterson succeeded March 17 after Spitzer’s resignation.

In the last decade, Wilmers contributed more than $200,000 to campaigns including $25,000 to George Pataki, the records showed.