Schumer-Poloncarz deal sparks outrage among East Side activists

Senator Chuck Schumer and Erie County Executive Mark Poloncarz announced today that $17 million in economic development funding will be made available for Western New York, following the resolution of a longstanding disagreement between the County and two federal agencies: the Department of Housing and Urban Development (HUD), and the Commerce Department’s Economic Development Administration (EDA). 

That money includes $3 million in direct federal grant funding and $14 million in revolving loan funds.

Activists on Buffalo’s East Side are outraged following the announcement — which includes a slew of government giveaways to wealthy developers and patronage allies of the County Executive — while entirely ignoring the Black community and the East Side of Buffalo.

Schumer said the Poloncarz administration has plans for the funds, which are intended to help Erie County “jump-start critical local economic development projects.” 

Activists say that none of those projects proactively includes the Black community or does anything to address the longstanding structural racism of Western New York’s unwritten economic order.

The Schumer-Poloncarz plan includes $500,000 to remediate part of the former Bethlehem Steel Plant in Lackawanna, Poloncarz’s hometown. Following Poloncarz’s moved to the City of Buffalo, grumblings of discontent among his political base in Lackawanna had ensued. Some say the move was seen as arrogant and out of touch. Operatives interpret the funding as intending to help Poloncarz placate his old political base.

The plan includes $325,000 for the Town of Evans’ Kennedy Avenue Greenway Improvements; $872,000 for Community Revitalization Projects to be selected during an application process in fall 2016; and $470,000 for Local Municipal Plan Assistance Program, which could help six to eight communities in updating their existing comprehensive or master plans; among other projects.

Nothing for the East Side.

TM Montante will benefit from the increased allocation of funding for the revolving loan fund, which they are expected to use on the firm’s current project: the redevelopment of the former Millard Fillmore Gates Circle Hospital, a 500-unit high end retirement community complete with retail. The project has received ECIDA revolving loan support even during the dispute between HUD and the EDA.

The interagency dispute was over whose rules should apply to the money that Erie County had placed in the Revolving Loan Fund, HUD or the Commerce Department. Experts familiar with the talks say that HUD rules would have required the County to be inclusive of minorities in its spending plans. 

Established in 1979, the county created the revolving loan fund to make loans to businesses in support of job creation. The fund includes both federal and local dollars, from the Erie County and the City of Buffalo. According to Schumer, in 2005 HUD modified its rules, asserting that local monies commingled with the fund are subject to HUD rules. 

Schumer claims that he stepped in to negotiate in July 2014. He asked the EDA to allow Erie County to take out the HUD funds it had contributed, to be used for specific projects, while the federal agencies worked out their differences regarding the revolving loan funds.

“After a decade-long bureaucratic tug-of-war, I’m thrilled to announce that we have succeeded in bringing HUD and the EDA to the table so we could develop a plan to unfreeze these critical funds. Unlocking nearly $17 million in federal funds means we can finally energize potential job-creating development projects in Erie County once again,” Schumer said in a press release published by The Buffalo News. 

Prominent Black activists want the revolving loan fund to be accessible to minority and women owned businesses that often are unable to work on government projects because of their lack of access to revolving lines of credit that would allow them to make payroll until the firm receives payment for work rendered. This is a particularly pronounced problem on publicly funded construction projects.

Small minority and women owned businesses are often left at the whims of general contractors, many unable to finish jobs because of delays in the government’s payment for performed work. For years larger government contractors have liked it that way, because their early stage competitors would be perpetually starved out of the industry.

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Katrinna Martin-Bordeaux, the Chairperson of Young Democrats of Western New York and the region’s most high profile Black Lives Matter advocate, is in the process of planning a “summit that brings the community together to discuss equity objectives in development, job creation, organized labor, housing, healthcare, law enforcement, education, the environment, and governance.”

The summit will be held in January of 2017.

It is rumored that Marc Croce is considering donating space at his Statler Building to host the summit. A source close to the situation says that Croce would like to provide civic leadership on the issue, particularly in light of the $5 million gift that he received from City of Buffalo taxpayers.

Croce is a close friend of Mayor Byron Brown.

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