3.1 Capital Improvement Program
The key to implementation of the Comprehensive Plan is the City’s Capital Improvement Program (CIP), which prioritizes and schedules all capital investments to be made with City resources and with those from any other source. This section outlines how Buffalo’s base CIP should be combined with the proposed special Buffalo Development Program over the initial ten-year implementation period of the plan, 2010-2020.
| Base City Capital Improvement Program |
Annual Allocation | 10 Year Total |
| Federal Entitlement – HUD Program | $28,516,000 | $285,160,000 |
| City Capital Budget | $25,000,000 | $250,000,000 |
| Water Authority | $15,000,000 | $150,000,000 |
| Sewer Authority | $8,000,000 | $80,000,000 |
| GBNRTC* | $37,800,000 | $378,000,000 |
| JSCB Capital School Building Program | $95,000,000 | $950,000,000 |
| Private Investment Leverage | $6,000,000 | $60,000,000 |
| Total | $203,094,000 | $2,030,940,000 |
| * GBNRTC funding estimate based on historical analysis | ||
The base CIP includes resources already available to the City. The Buffalo Development Program includes the additional resources from County, State and federal sources needed to fulfill the goal of the plan. The elements of the base CIP include:
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Investments of $25 million per year over the ten year period out of annual municipal operating budgets and capital borrowing already available to it.
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Other capital funds that support the Comprehensive Plan, including funds to the Joint Schools Construction Board, the Water and Sewer Authorities, and the Greater Buffalo Niagara Transportation Council.
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Capital funding from existing State and federal programs at levels for which it already qualifies, including those from the federal Department of Housing and Urban Development, Empire State Development Corporation, and other transportation and education programs.
All of this together will bring the City close to its borrowing limit under the New York State constitution. Yet the total remains inadequate to fully implement the Comprehensive Plan. A special Buffalo Development Program (See Table 17) is required to bridge the gap. This program would provide an additional public investment of $35 million annually over ten years, for a total of $350 million.
| Special Buffalo Development Program | Annual Allocation | 10 Year Total | |
| Community Preservation Goals | $2,500,000 | $25,000,000 | |
| Housing Restoration Goals | $7,500,000 | $75,000,000 | |
| Ellicott/Olmsted/Waterfront | $5,000,000 | $50,000,000 | |
| Economic Development Goals | $2,500,000 | $25,000,000 | |
| Street Infrastructure Goals | $10,000,000 | $100,000,000 | |
| Water & Sewer Goals | $5,000,000 | $50,000,000 | |
| Non- Olmsted Park Goals | $2,500,000 | $25,000,000 | |
| Subtotal | $35,000,000 | $350,000,000 | |
| Private Leverage | Ratios | ||
| Community Preservation | 2:1 | $5,000,000 | $50,000,000 |
| Housing Restoration - Neighborhoods | $7,057,500 | $70,575,000 | |
| Housing Restoration - Downtown | $14,115,000 | $141,150,000 | |
| Ellicott/Olmsted/ Waterfront | $15,000,000 | $150,000,000 | |
| Economic Development | $15,510,000 | $155,100,000 | |
| Non- Olmsted Park | $5,000,000 | $50,000,000 | |
| Subtotal | $61,682,500 | $616,825,000 | |
| Total of Public & Private | $96,682,500 | $966,825,000 |
Federal and State contributions to the special Buffalo Development Program could be drawn from the full array of government agencies. Based on a long-term U.S. bond rate of five percent and a ten year schedule of roughly even expenditure of these funds, the program would have a net present value of $257.4 million.
When the special Buffalo Development Program is combined with the City’s base Capital Improvement Program, the total annual public investment made would be $253 million dollars. Over the implementation period 2010-2020, the total public investment would exceed $2.5 billion.
This plan assumes that investments of this magnitude carefully targeted to economic development, basic infrastructure, transportation, housing, education, parks and public amenities are substantial enough to change the investment environment of the city and stimulate an increased level of private investment. Therefore, the implementation program assumes that leverage of private capital by public investment will increase, ranging from 1.5 to 1 to 3 to 1 (See Table 17).
This plan also projects that the assessed valuation of all Buffalo real estate will begin to grow again as a result of the combined impact of the base CIP and special Buffalo Development Program. It is estimated that annual local property tax revenues will have increased by $1.9 million annually by the end of the ten year investment program in 2020. By the fifteenth year of the program annual tax revenues will have increased $9.45 million annually over the current year (See Table 18).
All of these funds would be directed according to the key principles of sustainable development, smart growth, “fix the basics” and “build on assets.” All would be targeted to seven policy areas – improving public services, rebuilding public infrastructure, transforming the economy, rebuilding schools, revitalizing housing and neighborhoods, reinvesting in the Ellicott- Olmsted-waterfront structure of the city, and working to protect and repair the fabric of the city. (See Table 18 for a conceptual annual and 10-year allocation).
Well-targeted public investments can spur a virtuous cycle of improvement in the urban environment, increasing private investor confidence, growing tax revenues, promoting further public investment, attracting more private investment, and so on. The improvement in the climate for private investment will have a double benefit for public finances: growing tax revenues and a decreasing need to provide property tax exemptions as investment incentives.
The returns on the full Capital Improvement Program including the special Buffalo Development Program will be substantial, not just for the City but also for the Buffalo- Niagara region, the State, and the U.S. government. For the City and Erie County, the returns will be particularly significant.
State legislation setting up the Buffalo Control Board acknowledged that the City of Buffalo has been more severely impacted by economic misfortune than other New York communities. The additional assistance proposed in the form of the special Buffalo Development Program is a companion initiative to the establishment of the Control Board that would materially assist the City to overcome its adverse economic circumstances and build a more prosperous future.
The redevelopment strategy at the heart of the Buffalo Comprehensive Plan will still be valid if there is no special Buffalo Development Program. It outlines a sensible way to invest in Buffalo. But if it is impossible to reach an agreement on the special Buffalo Development Program, progress toward achieving the goal of the Comprehensive Plan will be much slower and the possibility of achieving the goal within the time frame of the plan will be more remote. The special Buffalo Development Program is indispensable.