ALBANY — Backers of legislation to reauthorize the ability of industrial development agencies to issue bonds to finance construction projects at hospitals, colleges and other nonprofit organizations say the current situation threatens dozens of projects across the state.
A state law allowing local IDAs to issue civic facility bonds to raise capital for nonprofit construction projects lapsed Jan. 31. Several pro-business and economic development advocates met Tuesday in Albany to urge its renewal. The original legislation expired in June 2007, and was extended through January.
One ongoing project in Jefferson County could likely have benefited from the issuance of civic facility bonds, which carry a lower cost than other financing vehicles. Donald C. Alexander, interim chief executive officer of the Jefferson County IDA, said the expansion project at Samaritan Medical Center in Watertown would have been "a perfect project" to finance with civic facility bonds.
"We could have helped and ameliorated costs associated with this project," Mr. Alexander said. "But we can't right now offer this type of service."
Raymond H. Fountain, CEO of the St. Lawrence County Industrial Development Agency, said that civic facility bonds have been used on many hospital and college-related projects in the past. He cited hospital projects in Potsdam and Ogdensburg, as well as construction at SUNY Potsdam and St. Lawrence and Clarkson universities as examples.
"Civic facility bonds are a quality-of-life issue — the general community is a beneficiary of having good educational and health care facilities," Mr. Fountain said. "It's a funding mechanism we've used quite often that is no longer available."
A $12 million expansion of E.J. Noble Hospital in Gouverneur has been delayed by the inability of the St. Lawrence County IDA to issue bonds.
"We've been working on that project for several years and are trying to move forward," Mr. Fountain said. "We're looking at other mechanisms, but this makes it that much more difficult."
He said a potential project at SUNY Canton is on hold because of financing issues.
Franklin County's IDA director, Brad Jackson, said that no projects in his county are under direct threat. In particular, he said, the southern part of the county would be helped if his IDA could issue civic facility bonds and cited a five-year, $50 million project at the Trudeau Institute, a biomedical research center in Saranac Lake, as one example of a future endeavor that could be affected by the lack of authorizing legislation.
"There's nothing currently pending, but we have substantial lead activity — one, two and three years down the road — that could benefit from this type of financing that could be threatened," Mr. Jackson said. "It would be useful going forward."
Legislation to re-establish the bonding authority of IDAs to finance civic facility construction projects has been introduced in both houses of the state Legislature. The Assembly bill, A.2557, is sponsored by Assemblyman Joseph D. Morelle, D-Irondequoit, while the Senate's companion bill, S.2684, is sponsored by Sen. Elizabeth O'C. Little, R-Queensbury.
Two local government advocates insisted that this legislation is critical for local economic development.
"Low-cost IDA financing is one of the few economic development tools available to local officials," said Peter A. Baynes, executive director of the New York State Conference of Mayors. "Without it, many non-for-profit construction projects would never get off the ground. New York must do all it can to promote such construction, since these institutions and the jobs they create are essential to the quality of life and economic vitality of our cities and villages."
Stephen J. Acquario, executive director of the New York State Association of Counties, was more direct: "Albany needs to pass new legislation as soon as possible."
