Saratoga County

Economic development groups make case to Saratoga County IDA

The competition between two organizations to be the county’s main economic development marketer will
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The competition between two organizations to be the county’s main economic development marketer will continue.

The newer Saratoga County Prosperity Partnership established by the county Board of Supervisors wants to become the county’s exclusive marketer, supplanting the 38-year-old Saratoga Economic Development Corp.

But on Wednesday members of the county Industrial Development Agency board raised numerous questions about the partnership’s proposed contract to work “exclusively” with the IDA, and postponed a decision.

SEDC is says it’s been successful in marketing the county and helping businesses create jobs, and shouldn’t be frozen out from doing a job it’s done well.

“After 38 years, it would be distressing to us if you gave the exclusive relationship to an organization that hasn’t been around very long and doesn’t have a track record,” SEDC President Dennis Brobston said.

The competition between the two organizations is creating uncertainty, but IDA Chairman Rod Sutton said he doesn’t think the county’s marketing efforts are being hurt.

“I think the county is strong, and this is a nice problem to have, two entities competing to market us,” Sutton said.

But during the meeting, he said the current dispute needs to be resolved.

“It’s time to let economic development take its course,” Sutton told Prosperity Partnership leaders. “You gave a great team, but we’re stagnant right now. Nobody knows where we’re going.”

The IDA plays a critical roll because it has the authority to grant tax breaks to attract new businesses, but generally has applicants work with a marketing organization to guide it through the process.

The Prosperity Partnership wants the exclusive right to do that.

“We want to establish ourselves as the point of contact for people looking at Saratoga County,” said partnership board Chairman John E. Lawler, the Waterford supervisor.

SEDC, which is a private non-profit organization that appoints its own directors, has played that role since 1978. Companies it has worked with include GlobalFoundries, Target, Ace Hardware and Quad/Graphics.

SEDC marketed the county for 35 years, but the county broke with it in 2013 when SEDC refused to appoint a county supervisor to its board of directors. SEDC leaders said they wanted to avoid bringing politics onto its board.

In 2014, the Board of Supervisors completed a strategic economic development plan and created the Prosperity Partnership, whose board is appointed by supervisors and includes several supervisors.

“My frustration when I got on the [county board’s] Economic Development Committee was who does what, and who are there?” said Stillwater Supervisor Ed Kinowski, who is on the Prosperity Partnership board. “What is boils down to is, who is responsible for economic development in the county? To me, it’s the Board of Supervisors.”

SEDC is supported primarily by about 300 business members. Brobston said it has had a role in bringing $13 billion in private investment to the county, and the creation of 17,500 new jobs since 1978.

“We think it makes sense for the county IDA to work with both organizations to create and retain jobs,” Brobston said at the meeting. “We have a proven 38-year track record of success.”

During the meeting in Ballston Spa, the Prosperity Partnership made a dramatic offer: President Marty Vanags said it is willing to waive all fees it would receive for bringing a project successfully to the IDA. Those fees are paid by applicants.

“One of the things we have to do is constantly lower the cost of economic development,” Vanags said.

That proposal raises a number of questions, including whether it would be an illegal gift of government services under the state Constitution, said IDA board member Andrea DiDomenico.

Under the SEDC’s contract with the IDA, SEDC receives half the application fee, up to a maximum of $50,000. Changing that would be up to SEDC’s board, Brobston said.

“Realistically, SEDC is not unhappy with how we have operated and our function and process has a value, and that has a fee attached to it,” Brobston said.

While SEDC is only paid if an application is approved and revenue varies widely from year to year, Brobston said on average the fee brings in $35,000 to $40,000 per year.

The IDA members asked the Prosperity Partnership to redraft the contract to clarify it. Sutton said a decision may not be made until May.

In the meantime, any business that contacts the IDA will continue to be referred to both organizations to chose between them.

It is almost unheard of for two economic development organizations to be working in a single community, those involved said.

Reach Gazette reporter Stephen Williams at 395-3086, [email protected] or @gazettesteve on Twitter.

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