Jefferson IDA eyes separate loan agency
In the face of criticism from Industrial Development Agencies at the state level, Jefferson County's may separate its loan-making opportunities from its real estate responsibilities.
Attorney W. James Heary asked the board, meeting Tuesday morning, to consider creating a local development corporation which would take on the loan-making abilities of the agency's three loan funds.
"It will protect the loan funds from liability," he said. "If the IDA is the subject of a judgment, these assets will be protected from the judgment."
The concept is a corporation that acts as a subsidiary of JCIDA with the same board members in oversight.
Members of the board agreed real estate actions — including sale-leasebacks and development of the Jefferson County Corporate Park — would be more likely targets of lawsuits.
JCIDA would still have the authority for sale-leaseback and payment-in-lieu-of-taxes agreements. But it is not clear what arm would develop the corporate park and property near Watertown International Airport, Dexter.
"It may defeat the purpose by transferring the loan funds and real estate to the same entity because that would transfer the liability with the loan funds," Mr. Heary said.
Mr. Heary said it may also protect JCIDA from criticism from Albany. IDAs have been accused by the state comptroller's office and others of not delivering on promised jobs and providing tax breaks to politically connected companies.
Attorney Justin S. Miller of Harris Beach PLLC, Albany, said state law is changing on industrial development agencies and it's unclear whether they will have the authority to operate in the same way.
"An LDC has a provision to loan under state law," he said. "In IDA law, that provision is conspicuously absent. There are conflicting opinions on whether they have that authority."
After a lengthy discussion, board member Michelle D. Pfaff asked for a draft of a certificate of incorporation, which must be filed with the state, and a plan for implementing the LDC. The board agreed to allow the two attorneys to draw up the documents. The members will consider it in a month's time.
In a confirmed change, the board agreed to hire Harris Beach as its law firm in working through policy changes due to state law and on a uniform tax-exempt policy for commercial wind development. Those duties previously belonged to Menter, Rudin and Trivelpiece, Syracuse.
The local office of Menter, Rudin and Trivelpiece remains Mr. Heary's back-up on local matters.
"It is a reflection of the changing environment and the need for people who specialize," said JCIDA CEO Donald C. Alexander.
Mr. Miller's work will build on what has already been developed, Mr. Alexander said.
Harris Beach, a statewide firm with an office in Syracuse, works for about 40 IDAs across the state and has worked on wind development issues, Mr. Miller said. JCIDA will pay $250 per hour for the law firm's services.
