Mar 5


Buffalo Billion: $50 million of waste

Cuomo administration belatedly and reluctantly acknowledges it spent $50 million for equipment Tesla will not use
Reporting, analysis and commentary
by Jim Heaney, editor of Investigative Post

Fifty million dollars is a lot of money. To most of us, anyway. Andrew Cuomo, not so much.

At a time the state is grappling with a deficit you can count in the B as in Billions, taxpayers have been greeted with the news that Tesla’s plant in South Buffalo has scrapped some $50 million of equipment purchased with state tax dollars. It turns out Tesla didn’t need the equipment after all, what with its constantly changing plans to produce solar power products at the plant.

Steve Brown of WGRZ broke the story last week — not that you would know it by reading today’s Buffalo News — reporting that trucks were hauling crates of equipment from the South Buffalo plant to a warehouse in Wheatfield. Officials at Empire State Development, the state’s primary economic development agency headed by Howard Zemsky, refused to answer questions when Brown came calling.


Cuomo, Zemsky and company have routinely stonewalled reporters when they call with questions about state economic development projects, or just about anything else for that matter. At the same time they were giving Brown the silent treatment, state officials across an array of offices were refusing to answer my questions about the apparently stalled, if not dead, IBM project in downtown Buffalo. 

The Cuomo crowd still isn’t answering my questions, but late Tuesday it relented and provided Brown and The News a brief statement that confirmed equipment worth $50 million has been shipped from the plant to the Wheatfield warehouse. In its statement,  the state maintained the equipment isn’t obsolete and could be sold to other manufacturers. In other words, taxpayers might not have to eat the whole $50 million.

I’m skeptical. Let’s all keep our eyes on Craigslist.

Let’s put the $50 million in context. The Buffalo Billion’s two big-ticket projects, aside from the Tesla fiasco, involve the $55 million earmarked for IBM and the $50 million spent to build and equip office and research space for Albany Molecular Research Inc. The cost of the unused Tesla equipment is right up there with them.

(Further perspective: City Hall recently had to scrape to come up with $2.5 million to buy and lease 50 badly needed patrol cars. For some $9 million, the city could double the amount of money it’s spending this year to repair its Third World quality streets. You get the picture.)

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Did Cuomo know the state would have to potentially eat $50 million in equipment when it signed the deal to buy the plant? Of course not. But his people, starting with prison-bound Alain Kaloyeros, negotiated such a bad deal that they exposed taxpayers to such an outcome.

Of course, there’s been nary a peep about this waste from our local politicians. There probably won’t be. They were all in when there were press conferences and groundbreakings to attend. Holding Cuomo accountable for wasting so much money that could have been put to so much better use in our community isn’t in their DNA. 

The governor and his people can’t undo their mistakes. But they could be more forthcoming about them. After all, it involves our money. They could start by fessing up about IBM.

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