LI scrambling to create projects to use federal aid

DEVELOPMENT

The Obama administration has allocated about $161.2 million in tax-exempt bonds to Long Island's two counties and towns, part of a multibillion-dollar nationwide effort to stimulate economic development and create jobs.

But so far, what has been stimulated is mostly agita among public officials scrambling to come up with projects that must be substantially done with the environmental review and permitting process to gain issuance of the bonds by year's end. If the bonds are not issued by then, the bonding authority, and the funding, are gone.

The U.S. Treasury said that about $25 billion in bonding authority is available under the American Recovery and Reinvestment Act. The bonds are targeted to areas affected by job losses. Long Island's towns and two counties are each allocated different amounts, depending on population and unemployment rates.

But some town officials are complain that guidelines were released only this past June and that they are still studying them. Oyster Bay Town, whose bonding allocation is about $16.9 million, has asked its departments of economic development and planning to come up with projects that may qualify, said spokeswoman Phyllis Barry.

"We've taken the steps to get the ball rolling," Barry said. "All the other municipalities are scrambling too. This was announced last June. Everyone was trying to find out who's on first."

Brookhaven Town Supervisor Mark Lesko acknowledged some anxiety over getting projects up and running in time for the program.

"We have put in place a mechanism to fast-track projects that would comply," Lesko said. The bonds can be used to finance almost any commercial use, with the exception of most residential rental property.

Last week, about 80 people turned out at a meeting at Brookhaven Town Hall to learn about the program, said Jim Morgo, who is consulting with the town on economic development programs. "We had our first applicants come in" on Monday morning, Morgo said.

The Empire State Development Corp., which is overseeing the program for the federal government, gave the counties and towns a deadline of Feb. 1 to state what they plan to do with the bonding authority. If the municipalities decide they don't want the bonds, they can sign a waiver, turning them over to the state.

The deadline is soft. But Andrea Lohneiss, Empire State's Long Island director, said it serves a purpose: "In order to be effective, you've got to hold peoples' feet to the fire," she said.

Can anyone say s-t-r-e-s-s?

Where the tax-exempt bond money is allocated for Long Island:

NASSAU COUNTY: $3.5 million

Hempstead: $42 million

North Hempstead: $12.5 million

Oyster Bay: $17 million

SUFFOLK COUNTY: $7.7 million

Babylon: $12 million

Brookhaven: $29 million

Huntington: $11.5 million

Islip: $19 million

Smithtown: $7 million