Paterson launches economic development deal to bring jobs and investment to WNY

Governor David Paterson launched the first critical step to bring Steel Development Co., a steel recycling firm, to WNY. The New York Power Authority (NYPA) board of trustees approved an allocation of low-cost hydropower for the company, which is looking to create 200 permanent jobs in WNY and invest $200 million in a new manufacturing facility. New York was competing with several other states and Mexico for Steel Development's new facility. "This announcement demonstrates the efforts my administration is making to bring business to New York State and specifically the Buffalo-Niagara region. This year alone, we have enticed nationally recognized companies like Yahoo! and Geico to come to WNY, creating new jobs and leveraging millions in private investment," Paterson said. "We will continue to work with Steel Development, Empire State Development and local and regional officials to finalize this deal. We recognize that the prospect of attracting this company was a tremendous opportunity for economic development and applied our best efforts to make this happen, with low-cost hydropower absolutely vital to our success." Steel Development will receive an allocation of 18.7 megawatts of hydropower from the Power Authority's Niagara Power Project, which provides some of the lowest cost electricity in the country to WNY businesses, municipal electric systems and rural cooperatives. Under NYS law, businesses benefiting from the hydropower must be within a 30-mile radius of the Niagara project. Steel Development, whose allocation will come from NYPA's Replacement Power Program, will work with local and state economic development agencies and other officials in deciding where to build the steel plant. Once the economic development package is finalized, Steel Development's new plant will use state-of-the-art equipment to turn recycled steel into rebar, a material used to reinforce concrete in the construction industry. It will have a total payroll of $10 million, providing average annual compensation of about $50,000 per year. In addition to the 200 permanent jobs, the Steel Development project is expected to create 600 to 1,000 construction jobs for the new facility, which is expected to be completed by the first half of 2011. Michael Townsend, chairman of the NYPA, said, "The efforts made to bring Steel Development to WNY exemplify how the strategic use of NYPA's hydropower can help to transform the economic landscape of a community. The Power Authority is committed to using its resources to help revitalize the WNY economy and, in particular, attract companies that can be the catalyst for long-term and sustained growth." Richard Kessel, NYPA president and CEO, said, "Governor Paterson's announcement is wonderful news, reflecting the singular attention he has given to spurring economic development in WNY and other regions of the state. The Power Authority and other members of the governor's administration had a number of meetings with Steel Development over the last year as part of a process for assigning hydropower and other incentives in a way that brings the greatest value to the State. We've achieved that goal and are looking forward to the significant contributions Steel Development will make to WNY's economy." Niagara hydropower, which supports tens of thousands of jobs on the Niagara Frontier, is provided at rates typically 75 percent less than market prices. Over the last year, NYPA has made allocations to nearly a dozen companies in the region for the creation of hundreds of jobs and capital investments of more than a half a billion dollars. Among the companies receiving recent allocations was Yahoo!, for a new data center in Lockport; GEICO, for creating a new operation in Amherst; and Sunworks Solar, for the construction and operation of a high-tech solar panel manufacturing facility in the region. Dennis Mullen, Empire State Development chairman and CEO designate, said, "Steel Development's selection of WNY for its steel recycling plant validates the substantial efforts taken under governor Paterson's direction to partner with the company to bring it to the region. We recognize the tremendous direct and indirect benefits, including demand for goods and services, the steel recycling facility and its 200-employee work force would have on WNY's economy. We look forward to continuing to work with Steel Development in their efforts to secure a location and begin operations in Western New York." Tom King, president of National Grid in the U.S., said, "National Grid is pleased to be adding its economic development resources and energy management expertise to the state and local efforts to attract Steel Development. This project is an example of the leadership and collaboration so essential to Upstate New York's economic vitality." The NYPA allocation of hydropower to Steel Development was undertaken in consultation with the Western New York Advisory Group (WNAG). In addition to NYPA and ESDC, it includes the Buffalo Niagara Enterprise, the Niagara County Department of Economic Development and National Grid. The WNAG was established in 2003 to help identify companies for available amounts of Replacement Power and Expansion Power.