Chad Arnold

ALBANY – Since 2016, New York has set aside $400 million for its Downtown Revitalization Initiative – a program aimed at rejuvenating blighted communities in the hopes of sparking economic activity and attracting new residents.

Forty communities have each received a $10 million grant under the program, which Gov. Andrew Cuomo has repeatedly touted as “transformative” while traveling across the state to announce the grants in person.

The program, however, has been slow in developing.

A review by USA TODAY Network New York found most of the money that lawmakers have committed to the program in the last four years has yet to be disbursed – and construction on just over a dozen projects has actually been completed.

About 140 projects have received funding in the program’s first two years, but only 14 are complete, totaling $15.6 million, according to state data.

Construction on dozens more projects will be wrapped in the months ahead while state and local officials work toward completing plans and acquiring key permits needed to advance the work.

Cuomo has vowed the money will be well spent.

“This critical program completely transforms downtown communities, resulting in unprecedented growth and development that leads to a renewed sense of pride in our cities, towns and villages,” Cuomo said earlier this year when it was announced another $100 million would be set aside for the program for the fourth consecutive year.

But with construction taking years to complete, critics of the program argue the state would be better served using the money to address regional infrastructure concerns or paying down the state’s debt.

The program, they charged, is nothing more than a way for the governor to enjoy the spotlight.

“It’s a way for the governor to maximize his political gain,” said E.J. McMahon, research director for the Empire Center, a fiscally conservative think tank based in Albany.

State money is ‘big boost’ But for places like Elmira, a Southern Tier city that has seen its population decline and and its economy stagnant over the last decade, the Downtown Revitalization Initiative program has been a “big boost,” said Daniel Mandell, the city’s mayor.

“We’re finding developers wanting to come in now and do private investment. I think a lot of that has to do with the DRI,” he said.

Similar scenes are playing out across the state – from New Rochelle in the Hudson Valley, to Plattsburgh in the North Country – where DRI grants have been awarded.

The grants have generated a 3-to-1 return on the state’s investment, including private grants, according to the Department of State, which monitors the program.

Such return is indicative of the state’s investment in communities across New York, said Howard Zemsky, who helped implement the program as the former head of Empire State Development, the state’s economic development arm.

“Having a vital downtown is the most important part of economic development,” he said.

A ‘growth spurt’ For Elmira, the DRI program has proven to be an economic spark in a city that has fallen on difficult times.

The city’s population has fallen 7% in the last decade as manufacturers that once drove the Southern Tier community’s economy ceased operations or relocated overseas to save on costs.

Of the 27,000 people who remain, 31% live in poverty, according to Census data.

“We were an industrial city … a lot of manufacturing,” said Mandell, the city’s mayor.

Since the DRI grant was announced in 2016, Mandell said the city has been on the upswing. Construction of a mixed-use building on West Water Street opened last year and has all 47 of its apartments rented out.

Eight other projects receiving DRI funds should be completed by next year, including the restoration of the Lake Street bridge into a pedestrian walkway, Mandell said.

“We’re seeing a growth spurt in the city of Elmira like we’ve never seen before,” he added.

Lake Erie College of Osteopathic Medicine announced plans to open a new campus in Elmira, and there’s been talk of private developers refurbishing blighted buildings throughout the city.

“We’ve got developers that want to take former buildings that were department stores and turn it in to housing and commercial use facilities,” Mandell said.

While Elmira still has a long way to recovery, Mandell said he views the DRI program as a turning point the city can build on.

“The DRI definitely gave us a jump start,” he said.

How the DRI program works Cuomo announced the DRI program as a way to create a regional competition between municipalities looking to revitalize their downtowns in 2016, setting aside $100 million in that year’s budget as incentive.

The prize: One $10 million grant for a single municipality chosen by each of the state’s 10 regional economic councils, which is made of business, political and community leaders.

Lawmakers have allocated an additional $100 million to the program in each of the last three years since.

Competition for the money has been fierce, with more than 300 cities, towns and villages applying for grant money since the program’s inception.

In order to qualify, communities must first draft a detailed proposal on how they will utilize the funds and further advance economic development.

It’s a lengthy process, but one that will give each community vying for grant money a path moving forward, even if a grant is not awarded.

“There’s no silver bullet to transform a downtown,” Zemsky said of the process. Awards are handed out based on the regional counsels’ evaluation of each plan.

Breaking ground The timeline to develop and complete a DRI plan once a grant is awarded varies depending on the scope of each project.

“The goal is to select ready projects that can move quickly to provide an infusion of capital into the selected communities and foster visible change within the area,” said Sarah Crowell, director of planning, development and community infrastructure with the Department of State.

In New Rochelle, the process took six months.

“I never worked so hard in my life,” said Luiz Aragon, the city’s commissioner of development. The city has experienced a boom in economic activity in recent years, Aragon said.

There are currently 11 active construction sites across the city and permits to advance 30 more projects in the coming months.

Aragon said he is “hopeful” construction can begin on some of the nine projects that have received DRI funding later this year, but said it was uncertain which ones.

“Some of these projects are easier to build, and others will take much longer,” he said.

Most the money – $6 million – will be used to repurpose parts of the Route 5 corridor to create more outdoor recreational space, which, according to Aragon, will help further spark economic activity by creating an “experience” within the city’s downtown.

“This is an incredible transformative project here in New Rochelle,” he said.

A more regional approach

But critics like McMahon argue tying up millions in state funding in order to serve a few municipalities does little to benefit the state as a whole.

The money, he said, would be better used addressing regional infrastructure concerns that will make larger swaths of the state more appealing, ultimately leading to greater outside economic investment.

The state also could use the funds to pay off debt or simply not spend the money at all, he said.

“Slicing and dicing it into literally dozens of $10 million pieces maximizes the political value for (Cuomo), but is not the best use of the money,” McMahon said.

A spokesman of the governor said New York has invested $40 billion in infrastructure across upstate and refuted any claims that the program has been politicized, pointing to Republican leaders in cities that have received funding under the program.

“The program’s success speaks for itself, with downtowns across the state getting a major boost from transformative plans and projects supported by the DRI,” said Jason Conwall, a spokesman for the governor, in a statement.

One such city is Plattsburgh in the North Country, which was awarded a DRI grant in 2016 under then Republican-endorsed Mayor James Calnon.

Calnon has since lost a re-election bid to Democrat Colin Read, a lifelong resident of Plattsburgh who has advanced the dozen projects that were awarded DRI money.

Read said he participated in public forums related to the project before he was elected and said he was skeptical given the projects’ scale.

Most of the money will be used to transform rezone parts of the city, creating greater access to the riverfront.

“I was skeptical on whether we’d actually be able to pull it off,” Read said. Construction, he added, is expected to wrap up next year.

In addition to the DRI grant, Plattsburgh invested an additional $3 million, making the city eligible for grants to upgrade its wastewater treatment center.

Combined with private investment, Read estimates $50 million has been invested in the city since the DRI grant was awarded.

“This is probably the single biggest investment the city of Plattsburgh has ever seen at one time,” he said.

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