Caution advised as Long Beach forms agency

The Long Beach City Council has given the go-ahead to start laying groundwork for a local development corporation, even as some residents urged the city to proceed carefully.

City Manager Jack Schnirman explained at last week's council meeting that a local development corporation -- a separate nonprofit entity -- spurs economic growth by providing incentives and financial assistance to local businesses.

Uniondale-based law firm Harris Beach will consult with the city on setting up the corporation. Noting the city's ongoing fiscal crisis, some residents expressed hesitation about costs. Schnirman said retaining Harris Beach would cost from $10,000 to $15,000, and said the money is already budgeted.

Former councilman Dennis Kelly offered cautious support, but pointed to a recent state comptroller's audit that found the village of Cornwall-on-Hudson used a local development corporation to skirt state procurement laws and fund a public works garage that built on unsuitable land, failed to meet building codes and cost taxpayers $929,000. He also noted a recent state attorney general's investigation into local development corporations found potential for nepotism and self-dealing.

"I'm asking you to perhaps give this some more consideration and put in some safeguards," Kelly said.

Schnirman promised to make the process transparent. Local development corporations are standard good government practice, he said.

"Our local business needs the support, and we need to bring more business to Long Beach to help grow our economy and create jobs," Schnirman said, adding that development corporations exist in such local municipalities as Glen Cove, Riverhead, Islip and North Hempstead.