Not all North Country Regional Economic Development Council ‘priority projects’ in St. Lawrence County come to fruition
Saturday, December 2, 2017 - 8:12 am

St. Lawrence County was awarded 26.3 percent of North Country Regional Economic Development Council ‘priority’ projects, but has the highest rate of projects canceled or ‘with concerns,’ 41.7 percent. Our county has only 18.8 percent of completed projects

By ANDY GARDNER

New York State through the North Country Regional Economic Development Council (NCREDC) has awarded millions of dollars in the past six years to economic development projects in St. Lawrence County, but a number of them have failed and the money will be moved elsewhere in the region.

St. Lawrence County is in the eight-county North Country council, made up of representatives from businesses, academia, government officials and non-governmental agencies.

Of 21 St. Lawrence County priority projects for which NCREDC promised funding, 13 are listed as “on schedule.”

Another three are finished – an expansion at Ogdensburg International Airport, an expansion at Currant Renewable Energy in Massena and phase one of rehabilitating 46 miles of the Newton Falls Railroad line.

But a radar manufacturing facility in Potsdam, a mobile chicken processor, a mixed-use housing and arts complex in Potsdam and grain bins in Ogdensburg are not expected to receive funding they were awarded through the NCREDC.

Also, another expansion at Curran Renewable Energy in Massena is indefinitely stalled with an uncertain future and United Helpers says it is postponing a proposed “food hub” in Canton. Both were among NCREDC approved projects.

Projects ‘On Schedule’

Other major St. Lawrence County projects still underway but described by NCREDC as being “on schedule” include a Hemo Medica pharmaceutical lab in Massena; a Hoosier Magnetics kiln replacement and dust collection system upgrade in Ogdensburg; an Agbotic commercial-scale robotic greenhouse in Potsdam; an LC Drives motor production prototype testing facility with hopes for eventual production, and a second award for LC Drives phase two upgrades; an expansion at Jeffords Steel in Potsdam; renovations for a permanent North Country Children’s Museum site in Potsdam; a Canton municipal water system expansion to the Maple Hill neighborhood; and three separate awards for revolving loan funds for North Country community redevelopment, agribusiness and North Country tourism development capital projects, all to be administered by the Development Authority of the North Country (DANC).

The United Helpers food hub is listed as “on schedule” in the NCREDC’s 2017 progress report, even though United Helpers in July released a statement saying that are putting the project on hold.

No Radar Facility

The company C Speed in 2011 was awarded $1.8 million to build a manufacturing facility in Potsdam to make a new radar system and other product lines, according to ESD.

“The company wasn’t ready to move forward with the project and ultimately decided not to open the Potsdam facility. They have another facility in Liverpool, NY (CNY Region),” Empire State Development spokesman Jason Conwall wrote via email.

The same year, C Speed sought a separate $2 million Central New York Regional Economic Development Council grant toward a $4.325 million project “to purchase, renovate, and equip a 33,200 sq. ft. facility located at 7481 Henry Clay Boulevard in Liverpool,” according to state records. That was also canceled, according to the Central New York Economic Development Council’s 2017-18 progress report.

C Speed President Dave Lysack did not return phone calls seeking comment.

Mobile Chicken Processor

A second 2011 project that failed was the North Country Pastured mobile chicken processor. The company was awarded $130,000 through the NCREDC, on top of a $50,000 grant from the St. Lawrence River Valley Redevelopment Agency and $30,000 from Canton’s Regional Business Enterprise Grant Program. Private investors, including three partial owners, also contributed to the business.

North Country Pastured celebrated its ribbon cutting in July 2013 after it received approval from the U.S. Department of Agriculture, but less than a year later, customers who were looking to have chickens slaughtered reported they could not reach anyone at the business.

Matt Draper, executive director of the Shipley Center at Clarkson University, said the unit wasn’t built the way it should have been.

“The unit was never made properly,” Draper said in a phone interview. “We worked with them to come up with a news business model … and salvage what we could in terms of value from that.”

He said Clarkson “never took ownership” of the processor, but tried to help NCP get it working.

“(Clarkson) President (Tony) Collins asked us to step in and see if we could come up with a feasible business model,” Draper said. Collins is a North Country Regional Economic Development Council co-chair.

“They (NCP) never matched their employment numbers,” Draper said, which was two full-time positions. “From the perspective [of] in order to break even and be sustainable and employ two people and bring value to the North Country, it would have had to process more than it was designed to process.”

Renee Smith, who operates North Country Pastured, could not be reached by phone and did not respond to several emails seeking comment.

Wood Pellet Expansion Stalled

Although not canceled, a priority project in Massena is stalled with an uncertain future. An expansion at Curran Renewable Energy in Massena was awarded $2 million in 2015.

Curran Renewable owner Pat Curran said because of a downturn in the forest products industry, he isn’t able to get the financing he needs to start the expansion. He said a Nov. 3 fire that destroyed a company storage facility won’t affect future production.

He wants to spend $15 million on two new facilities, and can’t get his grant until he spends the money. One would expand on his wood pellet plant and make wood shavings and briquettes that could be a substitute for firewood. The other would be a sawmill and pallet manufacturing plant.

“I would go forward with it if I could get the funding. But the forest products business has been weak for the last couple of years. It’s pretty hard,” Curran said. “The economic council is good and they come up with a couple million dollars to go and a tax credit once you get going, but you can’t use it to start a project. I need to borrow $15 million and I don’t see anybody eager to jump on that.”

He said a fluctuating Canadian dollar is part of the problem.

“It had gained strength over the summer, but it’s lost most of its gains in the last five weeks,” Curran said. “If the economics could work, the market is there. But if the economics don’t work, we can’t play in it.

“In a bright day, if the Canadian dollar ends up in the right place, this could end up getting the pellet plant to 100 percent capacity.”

Curran says he is not giving up on the expansion, since there is no deadline to accept or decline Regional Economic Development Council money.

“Do I think it’s viable? Absolutely,” he said.

Curran was successful with a 2012 project that received $168,000 in REDC money. The project called for the company to invest $1.6 million for a wood fire combustion chamber to enable green residual wood fiber burning, providing heat for the drying process of its wood pellet production operation. Ten jobs were expected to be created as a result.

Congdon, Old Snell Halls

In 2014, Omni Development Company was awarded $1,185,000 to work with Clarkson University on turning Congdon and Old Snell halls into mixed-use buildings, but Omni pulled out at the last minute.

Clarkson University CFO Jim Fish said it would have been “primarily residential, for both buildings … with some space on the ground floor for the SLC Arts Council as well as Clarkson for their entrepreneur programs and innovation program.”

Fish said he’s not really sure why Omni backed away from the $26 million project. Omni Development, based in Albany, deferred comment to Duncan Barrett, their former employee who now works for Beacon Communities LLC. Barrett did not return phone calls seeking comment.

“They were not entirely clear as to why. I’m guessing they got cold feet and couldn’t make the numbers work. They never really were forthright in saying why. They just said they were not interested in the project,” Fish said.

Duncan Barrett, former employee of Omni Development who was in charge of their end of the project, tells a different story.

He says Clarkson decided to remove Omni from the project because he believes the college was frustrated with Omni’s pace.

“It was Clarkson’s decision, not ours,” Barrett said. “I don’t believe we abandoned the project, I believe Clarkson grew frustrated with us.”

Barrett did not want to comment on the contradiction between his version of what happened and Fish’s explanation.

“I have no comment,” Barrett said. “I have immense respect for Clarkson as an institution.

“I’m not interested in arguing with them publically.”

He says the more Omni and Clarkson looked into existing conditions at the buildings, the higher rehabilitation cost climbed.

Citing one example among several problem areas, Barrett said the Congdon Hall roof needed to be replaced, but needed a specific, and expensive, type of replacement.

“We found out that the replacement of the original roof with a roof that was going to be acceptable to National Park Service was going to be more than we expected,” Barrett said. “The building has a standing metal seam roof, beautiful roof, needs to be replaced.

“Because of the space between the existing standing seams, it’s a copper roof … it would come with a different spacing between the seams, so that wasn’t going to be acceptable to the Parks Service … There were a number of pieces of it. I am not blaming Clarkson for what it cost to renovate this building.”

Fish says Clarkson is still moving forward with the project using a new developer, the Vecino Group out of St. Louis, Mo.

“We’re hopeful we can pull this off over the next two years, that’s what our timeline is,” Fish said. “We’re cautiously optimistic to still get this thing done.”

Draper said Clarkson has not applied for funding towards the project through the NCREDC, but the Vecino Group may. Officials with the company did not return phone calls seeking comment.

The Potsdam village Board of Trustees on Nov. 20 tabled a motion that would signal preliminary approval of the project proposed by Vecino for renovation and restructuring the space in several buildings on Clarkson University’s old downtown campus.

Questions about the plan’s effects on existing local housing prompted the trustees to delay a vote until Mayor Ron Tischler, who was absent from the meeting, can publicly provide his input.

OBPA Grain Bins

In 2013, the Ogdensburg Bridge and Port Authority was not able to make a project work, but it was completed several years later without REDC money.

OBPA that year wanted to build grain storage bins, for which they were awarded $225,000.

OBPA Executive Director Wade Davis said they were not able to get a contractor to match their initial project estimate.

“The initial project came in way over budget, like twice as much … it was not even close in terms of the funding. It was so far out of the realm,” Davis said.

He said the money was put back into the region and reallocated for the Ogdensburg airport expansion grant in 2015.

“The (grain bin) bids came in $1.3 million over budget after being bid twice, so we declined the funding and requested it be rolled over to … the baggage claim project at the airport,” Davis said. “The $225,000 was added to another project we had at the airport with the baggage claim, so it was $725,000.”

“In this case, the grant stayed within the North Country and was reallocated to support the Ogdensburg International Airport expansion project through ESD’s standard grant review process, and with approval from the North Country Regional Economic Development Council,” ESD spokesman Adam Ostrowski said.

Davis said OBPA has since gone ahead and built the grain bins.

“We revisited the grain bin project, put it back out to bid when the market was more competitive and we were able to pursue and complete the grain bin project at the Port of Ogdensburg as envisioned,” he said.

Food Hub Stalled

A July 6 press release from United Helpers says they are postponing the food hub project, which in 2012 received $350,000 in funding through the NCREDC.

“Health Care Reform, and the many initiatives that are connected with Health Care Reform, call for an ‘All Hands-On Deck’ effort and require United Helpers to focus on our long-term health care strategy. While disappointing for many reasons, continued exploration into the food HUB and processing center have been postponed while we address Health Care Reform,” Cinnamon Alberto, United Helpers director of marketing and communications wrote in the statement.

United Helpers had purchased the Sparx building in Canton and had 30 employees working there.

“Sparx has focused on providing a unique package of back office services to small businesses and community organizations (human resources, information technology, payroll and accounting), renting professional office space, and researching job opportunities that play to our County’s strengths,” Alberto said in the July 6 statement. “One of the opportunities Sparx investigated is a food HUB and meat-processing center. The idea being that St. Lawrence County produces the ‘raw material’, but does not reap the value-added benefits (jobs) of processing. Significant time and resources were devoted to researching the HUB and we have concluded that the idea does present a ‘transformational’ opportunity for our community’s economy.”

What are ‘Priority Projects’?

The Regional Economic Development Council program divides New York into 10 regions tasked with coming up with “long-term strategic plans for economic growth for their regions.”

The NCREDC is co-chaired by Clarkson University Pres. Tony Collins and Garry Douglas, president of the Plattsburgh-based North Country Chamber of Commerce.

Each council finds or takes applications from projects within its respective area, ranks them and forwards them to the state for final approval.

Some projects are considered “transformative and transformational” for a region and are granted priority status, which is what this story deals with.