Looking for bright spots, in a tough economy
SCHUYLER COUNTY—It can be hard to know where you’re going and how you’re going to get there if you don’t know where you’re starting from. Confusing, though generally gloomy economic news can make investors and would-be entrepreneurs cautious. But Schuyler County is determined to be a sunny spot, from the top down.
“The legislature made a proactive decision, implemented this year, that this is absolutely the wrong time to cut back on economic development,” says Schuyler County Administrator Tim O’Hearn. “We’ve dedicated a portion of sales tax revenue to economic development and this has provided some stability and insulation from the downturn.”
While no one would claim Schuyler County is immune from the effects of the larger economic picture, this summer paints an optimistic image. “Sales tax is positive. We’re experiencing record sales-tax collections,” O’Hearn says. “Our tourism economy continues to grow, approaching a million dollars in gains from the year before at this time. Room tax continues to grow in double digits as well. We have a tremendous advantage as we are a destination and tend to be an area that’s attractive to visitors.” But, he cautions, “We need to continue to focus on creating employment opportunities and stability within our work force.”
The seasonal influx of tourists has also inspired several business owners and wannabes to consider expansions and new startups. J. Kelsey Jones, Executive Director of Schuyler County Partnership For Economic Development (SCOPED) says that although there may be a lot of people on hold due to continued economic uncertainties, “We are suddenly very busy,” he says. “Was it the rainy spring? If all the projects in the docket went forward, we’re looking at about 35 jobs, which for Schuyler County is significant. A lot of these are start-ups. They’re mostly tourism/culinary based. Hopefully some of them will come to fruition. I think some of them will.”
Getting from inspiration to actuality is a rockier road than it used to be. “In terms of incentives on a state or federal level, we don’t have that much to offer,” Jones says. “Programs that existed a few short years ago simply don’t exist. It’s tough. And we continue to be perceived as an unfriendly state to do business in due to high taxes, the high cost of energy and other regulatory hurdles.”
Additionally, he notes, the banking world has changed. “Banks are much more cautious. The bank might say, ‘I love your project,’ but then fund only 60 percent.”
Filling the gap calls on a business owner’s ingenuity, perseverance and preparation. Business plans need to be as solid as possible. There’s a lot of professional help available. “Any project, you do is going to have to have a business plan—if you want to open a restaurant, a winery, you’re going to need a business plan for the bank and other sources of funding,” says Jones. “If someone’s reading this article and thinking of doing a business or a sideline business, there’s all kinds of free help in assistance with business plans. Of the seven or eight, projects that have just walked in the door in the past few weeks, most of them have been assisted with business plans.
“This is a free service, an excellent service,” he continues, explaining that Corning Community College offers one-on-one help at the SCOPED office. “Business plans are daunting for some people—you may have the best idea in the world, but taking a look at revenue and cash flow is hard for some people.”
After all one’s ducks are in a row, there remains the question of funding. Many start-ups and expansions are now funded through a patchwork of sources. “We have two loan funds locally at our disposal,” Jones explains. “One was originally capitalized by the USDA and the other by the state office for community renewal. Since our inception, we’ve done 32 loans to small businesses that could not secure traditional financing, or where there was a gap. We’ve had a good track record with those loans. And besides those we have the Regional Economic Development and Energy Corporation (REDEC) covering Steuben, Schuyler and Chemung. Lately we’re finding many of the projects are a combination of several sources of funding.”
In the big picture not all is rosy. Jones says the nonprofit sector is being hit very hard, as state and federal funding sources they’ve previously depended on have evaporated. Many have had to cut back on staff.
O’Hearn’s experienced similar constraints in a difficult economic climate. “Our biggest impacts have been on actual operations,” O’Hearn says. “Our revenues are traditionally late anyway, but as the state’s situation has gotten worse, delays in reimbursement are extended. These make it more difficult to operate.”
When things will get better is anyone’s guess. As anyone who listens closely to the news can attest, economic forecasts seem to change hourly, with many economic indicators in contradiction to each other. But Jones sees at least one highly promising local sign of robust economic health. His office shares parking facilities with the Harbor Hotel and when he returns there after a mid-day meeting, he recently began experiencing a new problem, due to the influx of tourists and downtown business. “It’s hard to find a place to park. And that’s a good thing!” he says.