Wednesday’s Gazette featured a story that could easily have been titled: “How not to do economic development.” It involved money — specifically, how much two economic development officials in Fulton County received in compensation and the way they received it, not only with hefty salaries but huge bonuses.
First, those bonuses — on the eye-popping order of $400,000 for at least two years — given to Jeff Bray, executive vice president of the Fulton County Economic Development Corp., and Peter Sciocchetti, executive vice president of its sister agency, the Crossroads Incubator Corp. The bonuses, according to Bray, were based on performance — i.e. how many businesses and jobs these men brought in. And they do have a decent record, helping land (with big state incentives) the Wal-Mart distribution center, among other projects, and mostly filling up the industrial parks.
The trouble is, nobody knew how generously they were being paid. That’s because the two agencies are run like private companies (funded mostly from fees and interest payments on loans), even though they are quasi-public (receiving some public money and using government tax breaks and other incentives).
Now we find out (thanks to a check of the two agencies’ federal tax forms by Gazette reporter Jim McGuire) that in addition to salaries in the $100,000, $200,000 and $300,000 range, Bray and Sciocchetti were receiving bonuses. Their biggest haul came in 2007 and 2008, after Crossroads Incubator Corp. sold many industrial park properties, and they each got bonuses topping $400,000.
In all, their total compensation of $1.13 million that year was more than a third of the $3 million in annual local taxes they claim to have brought in from all the businesses they lured. Looks like Schenectady Metroplex Authority Chairman Ray Gillen, who has done at least as much as Bray and Sciocchetti, and arguably more (if you consider downtown Schenectady’s renaissance), for a straight salary of $160,000 paid by the county, works in the wrong county.
More seriously, it’s clear that these guys are paid way too much, especially in a poor county like Fulton, and that the private model isn’t the only way, or necessarily the best way, to do economic development.