EDITORIAL: Open up the CEDC

WANT A REFUGE from global warming? How about a 65,000-square foot freezer? You could stuff a lot of popsicles in a place that big.

A structure that size is what Ginsberg’s Institutional Foods, Inc. plans to build just south of the county airport on Route 66, with major support from the Columbia Economic Development Corporation (CEDC) in the form of a donation of sorts: 33 acres in the towns of Ghent and Claverack. And, in conjunction with the CEDC’s companion agency, the county Industrial Development Agency, there will likely be significant breaks in property and sales taxes over the initial years of the project.

As often happens with proposals for industrial project incentives, the rationale is that if the county doesn’t offer enticements to companies to expand here, they will go somewhere else. At least one member of the CEDC board said David Ginsberg, owner of Ginsberg’s, mentioned that possibility. Why wouldn’t a business follow the money?

Ginsberg’s was founded in the county over a century ago and the offices and plant of this regional food distribution company are less than a mile from the site for the new cold food storage facility, which makes sense for the company. Some neighbors have raised concerns about the size and impact of the new facility across the highway from the county industrial park.

In the last few months, as the CEDC worked out the details, the project has attracted an increasing amount of criticism on other grounds. It started with the decision by the CEDC to transfer the property, assessed at over $280,000, to Ginsberg’s for $1. There are conditions on the deal that require Ginsberg’s to complete its project or face paying for the property. Also, the estimated costs to prepare the site will be steep and the CEDC says no one else expressed interest in that property. But such a big a price break has struck some observers as too generous.

The plan generated even more heat when opponents learned that the county had purchased the land in 1997 for $109,950. CEDC officials say that figure was discussed at board meetings regarding the Ginsberg’s project. But the minutes since late 2013 do not refer to the original cost of the site.

Mr. Ginsberg resigned from his post as a member of the volunteer CEDC board before the CEDC formally decided to support his project. But the current CEDC board president, David Crawford, heads the engineering company working for Ginsberg’s on the project. Mr. Crawford readily acknowledges that he has a conflict of interest in this regard, and he does not vote on CEDC matters related to the project nor, he says, does he participate in discussions of the project at CEDC meetings.

But that assertion is contradicted by the minutes of recent CEDC meetings. The minutes report that during the August 2014 meeting the board heard an update on the request by Hillsdale town Supervisor Art Baer for a legal opinion on the handling of the land transfer and whether there was any conflict of interest involved. The minutes say: “Mr. Crawford stated this was all due to politics.” If that isn’t participation in discussion of the Ginsberg’s project, it’s hard to imagine what is.

Two years ago The New York Times conducted a major review of the incentives state and local governments gave to businesses nationwide, finding that in many cases what the public got for its investment in giveaways and tax breaks wasn’t worth the lost revenue. Statewide the Times said New York was handing out $4.06 billion annually in subsidies to private companies. So the CEDC is not some renegade bunch. It’s local businesspeople trying to achieve the agency’s goals of attracting and retaining business in a competitive market.

But the way the Ginsberg’s project has been presented to the public has fed public skepticism that this is an insider deal, the product of favoritism and conflicts of interest. It has damaged the reputation of an agency the county unquestionably needs to support smart business development with subsidized loans and, yes, with other incentives too.
The CEDC board must agree to the request for a legal opinion on its actions. It’s a firstĀ  step toward clearing away the smoke of reasonable suspicion. At the same time the agency needs to make the public more aware of the data it uses to make its decisions and tell the public what rules it uses for choosing which businesses benefit and by how much.

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