>> Coming up on "Need to Know," we talk to the man picked by Governor Paterson.
We will learn what Dennis Mullen, the incoming President of Empire State Development, has in mind.
And Karen DeWitt reports from the Democratic National Convention in Denver.
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>> Rochester's newsmagazines in 1997, this is -- newsmagazine since 1997, this is "Need to Know."
for the last three years, Dennis Mullen has served as the CEO of amped --
Last week, Mr. Mullen's responsibilities were greatly expanded.
Governor Paterson chose him to lead the state efforts to revitalize upstate New York's economy.
He will become a state president of the newly realigned Empire State Corp.
What is your job develop -- what is your job description.
Let's start there.
>> That is an interesting question.
My job description is expand on what we started to do in the Rochester area, covering seven regions, similar to the rate -- to the Greater Rochester area from Albany all the way across to Buffalo, the northern tier, the southern tier.
I think the job description is simply defined as my responsibility to assure the retention of businesses within the upstate region, and it is my task to recruit new businesses and jobs to the region, defined earlier.
The other thing that would be encompassed in my job description would be to bring new capital investment, new dollars into the upstate region.
The trickle-down effect -- we used Brillo as an example.
It came from outside the region, outside the country.
Invested almost $100 million into our Greater Rochester region economy.
Those capital dollars are critically important because they have a trickle-down effect in stabilizing the need to existing jobs -- in stabilizing the existing jobs in the community.
The retention and recruitment of new jobs and bringing capital dollars to the upstate economy.
>> I was looking at statistics this morning.
Describe your challenge.
>> You know, we know what went on in the past.
The challenge that I have and was clearly laid out by the governor, my conversations and with him as well as Mr. Wilmers, the chair of the Empire State Corp. in Buffalo -- the challenge is to move the economy forward.
The Greater Rochester area -- what is going on in the Greater Rochester area similar to what is going on in all of upstate New York.
We have gone from a manufacturing based economy to a knowledge based economy, and our region here as well as all of upstate New York, has been primarily in manufacturing based economy.
With that change, we need to move this economy into more of a -- what is being required right now, and that is one that is more knowledge based.
Even the barilla plant is an example.
I spent 30 years into the -- in the food industry prior to taking on these challenges I have now.
In the old days, you would build the plant $25 million, and he would fill it with labor.
He would fill it with several hundred people.
Barilla comes in, and I think the plant of the future is going to be based on knowledge based economy.
Technology for production in any area today has advanced so far that you will spend $100 million to put in a manufacturing plant, but the number of people to manage that technology to put in is only probably 100.
Those are the differences, those are the subtle changes.
So we need more barillas more manufacturing opportunities because we are hiring less people.
>> The picture is not pretty.
Prices are skyrocketing.
Construction costs are skyrocketing.
Unemployment is up, employment is down.
Why do you want this job?
>> That is a great question.
A couple of reasons, I think.
The first is, Kathy and I have been very lucky in our lives.
We have been successful, and it is time to give back.
We thought that way 10 years ago, and with this opportunity, I had the opportunity with the governor, for an extended period of time, and I believe what he is saying.
He understands upstate New York, he understands all the statistics that you have just alluded to, and he wants to make sure that we do everything possible to make the plight of the residents of upstate New York better.
I think the biggest challenge that we have is managing those expectations because, just like anything else, we did not get here overnight.
We are not going to get out of this overnight.
I have had the opportunity to travel across the country, and in many areas of the country I see very similar challenges.
What we need to do here is to understand, what do we have that differentiates us from other areas of the country, and how do we maximize those core competency is to be able to be successful, and that is what we are going to look to do.
>> What tools do you have your disposal to get the job done?
>> That is pretty interesting.
Right now I need a 60-day, 90-day assessment of exactly that question.
When do we have, what are the core competencies for the entire region?
Let me talk a little bit of how we broke down in the Greater Rochester area.
We think in the Greater Rochester area that some of our core competencies were food and beverages.
We have 100 or more food and beverage companies in the region, and there is a reason for that.
One of the requirements is water.
We have water.
You know, we wear our winters like a badge of honor here in our community and throughout upstate New York and Buffalo.
That snow that falls every year is a tremendous resource than many other areas of the country would covet.
>> They do covet that.
>> And they do.
Exactly.
What we need to understand is that, and we talk to food and beverage manufacturers, they are not necessarily interested in doing anything more than perpetuating their business plan, making their stakeholders and stockholders happy.
In order to do that, they need certain things that we have.
So is that kind of matchmaking that we need to do, matching resources with businesses.
We have a very educated work force in the Greater Rochester area.
80% of our population has a high school degree or more.
We have 19 colleges and universities.
We have research being done at the University of Rochester and RIT and places like that.
Those types of things are assets that we would like to match and promote with companies that we are looking to attract.
>> Before it was realigned, it was the UDC, and his recent realignment followed in very short order when we had it upstate, downstate.
Is there pressure to show that this is the right realignment?
Is there pressure to show results soon so that people maintain faith in your agency?
>> I think you are talking about two questions.
Let's talk about the London first.
It is crystal clear -- -- let's talk about the alignment first.
It is crystal clear -- it was crystal clear to Eliot Spitzer and now give it can't -- David Paterson that you need to have could comprehension and understanding.
You have various corporations that -- the Empire State Development Corp. that are doing things like building Yankee Stadium, building Shea stadium.
It is very project driven.
In upstate New York, we are a job retention and job recruitment driven.
The dynamics are different.
Downstate, the financial district, in the tourist capital of the world, almost literally, and upstate is agriculture driven.
People want to see progress being made, and one of the challenges I have is managing expectations.
Again, to recruit businesses to this community and across upstate New York, we are committed -- we're competing with every other state in the union, and we are competing on an international basis.
That is why it is so critical that we understand what our core assets that are meaningful and match those assets to the businesses.
Because no president is going to consider moving to any other place than that exist in today without having an upside to its stake holders and shareholders.
And having a real business reason for doing it.
The old days, CO's would say I want to move my -- CEO's would say I want to move my headquarters.
That does not happen today.
The government's over CEO's in corporate America today is much tighter.
Sarbanes-Oxley is much tighter.
That is not going to happen.
There has to be a real business reason, and that is where we have to look to get to.
>> How do you keep from pitting one region against another?
Everyone will want those development dollars.
>> I don't think you can.
I do not think it is my responsibility or Empire State Development Corp.'s responsibility to necessarily pick one region or the other.
We need to understand what are the core competencies of each region, and then we will fit the businesses to the core competencies.
Then we will look across the entire region to where the core competencies match.
You know, many times businesses are looking to hire a significant number of people that may fit.
We may position a business in between two major metropolitan areas, whether it be between Buffalo and Rochester or Rochester and Syracuse, to be able to draw an employeebased that as much broader.
-- An employee base that is much broader.
>> Everybody talks about the high taxes, the high utility rates.
Do you get involved in legislative priorities at all?
>> I am trying not to.
The legislature -- personal taxes would be issues that we deal with.
Our corporate tax rate is from a competitive, and most people have cited that.
When you look at the states that we compete with and the surrounding states in the Northeast, our corporate tax rates are not disproportionate.
It is our personal tax rates that lead the country.
A lot of those tax dollars go to education.
When we look at our competitors across the country, where do we rank as a stake in education?
We rate very high.
So some of the dollars that we are paying -- and I would be the first to say that I would like us to pay less in dollars in taxes -- however, we cannot lose sight that there is a direct price value relationship with some of those dollars, because when we are entertaining companies, moving toward a knowledge-based economy who won an educated workforce, that is one of the components that our tax dollars -- who want an educated workforce, that is one of the components that I talked dollars work toward now.
-- that our tax dollars work toward now.
our goal is to have that pay off in the real return on that investment.
>> Per yourself in the in that -- in the shoes of a typical New Yorker right now.
State leaders, state officials, economic developers talking about creating jobs, doing things.
What is it that you can actually do for that person to create a job?
Is it funneling, helping distribute grants?
Is it using your negotiating skills?
What can you actually do to bring jobs to this area?
>> I think I can speak like a president because I was a president in the private sector.
I ran at 1.8 $5.1 billion business that competed nationally and internationally and had -- I ran a $5.1 billion business that competed nationally and internationally.
I have some idea of what CEO's are thinking.
Number two, I will readily admit, no one person can do this in isolation.
We need to have a community effort across all of upstate New York to help us be matchmakers and rainmakers, to be about to use the connectivity, the existing business community, to their suppliers.
To their contacts outside the region, to help us understand -- most recently, present at Kodak did a great service.
He brought in the economic development professionals of the great Rochester region, the state in GRE -- we had an opportunity to present to the supplier base that he had in based-in place over 250 suppliers.
We came away with that with real needs of businesses that would look to move their business to the Greater Rochester area because Kodak is such a large supplier.
Given what is going on in the economy right now, they need to be taking costs out of their system -- inventory, capital cost -- as well as transportation costs, getting them closer to where their customer is.
Things like that that can really help us.
And everyone that is sitting out there with business or running businesses or connected to business can be a part of the solution.
>> Congratulations on your new responsibility and your new job.
Thanks for being here.
You can go to wxxi.org/ntk and click on the link for audio podcast.
WXXI's State Capitol reporter, Karen DeWitt, was following events at the Democratic National Convention mopping close attention to the --
>> Prior to the convention committee big news was about the tension building between the Hillary Clinton supporters and the Obama supporters.
Has any of that tension been defused by party leaders?
>> Well, they claimed that it has been, and they are working really hard to try to diffuse that.
Hillary Clinton in her first appearance at the convention back on Monday spoke to the New York state delegation, and she really pretty much said everything she needed to say about calling for unity, trying to get supporters --
They kept saying you have more in common with Obama than you do with John McCain.
Then on the other hand she left the door open to them to vote their conscience when they vote on the floor.
>> How would you characterize Governor Paterson's speech?
>> Well, he is sort of spending -- sending a message of doom and gloom around the country.
He seems to want to get this message out to the nation about New York's financial problems and how the nation, he thinks it is a bellwether for the nation, and the nation is having problems that will segue into Barack Obama being the best person to get us out of these hard times ahead.
It is very interesting because, as we know, he was a liberal Democrat in the New York State Senate in 20 years.
Now he is the fiscal conservative, taking the message of fiscal conservatism all around the country now and hoping to get that message out and, you know, being a political analyst, you have to wonder why.
He thinks that is the way to go, or is it that he has hung around state government for so long he has seen the light and, so to speak, things you have to focus on the spending cuts and tax increases.
>> So how is Governor Paterson been received in Denver by Democratic bigwigs?
>> Well, I sought him -- I saw him speak at the California convention, and he seemed to win them over with his humor.
At first they did not seem to know how to take him, and then he got them laughing.
After all, he was a Hillary supporter, and his speech was not on any big prime-time spot.
But the fact that he got a spot at all is --
Them a pretty big deal.
>> --
>> A pretty big deal.
>> Patterson was kind of overlooked because Hillary Clinton came in.
U.S. cent -- U.S. Senator Chuck Schumer, in cash came in and introduced her.
He is a little bit lucky, kind of self-effacing, and it shows where that might be a problem.
He did not make a big deal about it, but some people felt a little bit badly after out that.
Here is the governor, after all.
>> Last week we were talking about how the Senate Republicans were getting along.
With Governor Paterson, a Democrat, this week at the convention he said some not very nice things about the Senate Republicans.
Is there any black about that at the convention?
>> Well, mostly he -- is there any blowbacl about that at the convention?
>> Probably it did not make things -- it did not making very happy to hear something like that.
I guess some of the Senate Republicans say that is not quite how it went.
But I think they have to expect a political bent like this.
Even though he had tried to be neutral and even friendly to the Senate Republicans.
We will see if they can put that aside once he gets back and it gets into the fall and they have got to deal with the property tax issue.
That is one thing the governor is not mention to his crowd, the property tax issue.
Most Democrats really do not want to do that.
>> And I would think that some of the union representatives would be pretty upset with Governor Paterson because they certainly were not getting a positive read from him over the last two weeks.
You spoke to the President of the largest public employees' union in Denver.
>> That is right.
They are upset about the budget cuts that have come out in the cuts that Governor Paterson made internally into the budget, and disagree.
I think what they're hoping is that being here in a freer atmosphere, they can get their message across to Governor Paterson that they want to go into a different direction.
Underneath the surface, the day are still kind of in a war, actually.
>> How are the New York State delegates dealing with Hillary not being the nominee?
>> Well, you know, a lot of them are trying to be troopers about it.
At least when I pull my microphone out, they are.
They say we have to move on.
>> What are they telling you?
>> As soon as I turn off the tape recorder, they say, you know, we are sad.
I think it was very poignant to hear her speech, and I think they do feel sad about it.
It is hitting them that she is not on to be the nominee and that this is not her convention.
I think that, you know, there are maybe not hard feelings but sad feelings about it, that this is a chance -- she went so far and she almost got there and then she did not make it.
>> Susan is host of public television's "New York now."
she talked to Karen DeWitt earlier this week.
Time now for the Business Section with the "Democrat & Chronicle."
>> Welcome mat down from the "Democrat & Chronicle."
-- Matt Daneman.
How good was the news for tourism?
>> For Monroe County, it was a rare bit of surprising good economic news.
The State Commission report, the impact of tourism statewide.
Tourism, spending, coming here and getting hotel rooms, buying a soda, that type of thing -- 967 million.
That was about a 7% increase from 2006 numbers.
Tourism is a growing part of the local economy.
>> Why were they coming?
>> You know, once again, you would have to know the minds of every single tourist that came here.
But the indication seems to be that you have got actually the nation's economy, the slow national economy, instead of working to our favor, people are not going to Las Vegas or far away trips.
They are doing shorter trips and we are right in the nexus of a big population area.
You have the eastern seaboard, Toronto, succumbing to the attractions here.
>> Eastridge Rowling is still trying to buy Energy East.
What is the -- --
>> It has been 14 months since the Spanish energy company has acted.
The meeting was supposed to take place this week for the voting on it.
Two members did not show up.
One was sick, one was not there for some reason.
They did not have enough members to vote on it.
We will have to turn on tomorrow and see -- who knows where this is going or how much it is going to take?
The issue for individual consumers is that we pay some of the highest residential rates in the country.
The company is saying we want to cut your residential rates.
The state is saying we want to cut even more.
The rates might just stay the same and nobody wins.
>> The upstate President of Empire State Development, Dennis Mullen.
What should he build on?
>> They have always pointed to a handful of key assets.
When you have natural resources -- we have tons of water out here, something the Southwest is dying for Renault.
We also have the educated workforce, a lot of -- is dying for right now.
We also have the educated workforce, a lot of college-educated residents.
The university system has been a drop and an attraction, and you cannot sort of ShortLine or pay little attention to the fact that -- like I said earlier, with optics, there is such a huge optics industry.
Rochester is known worldwide as the cloister of optics people.
>> Upstate, Greater Rochester Enterprises lost.
There has now been a host of GRE is.
What you think about that.
>> Mark knows the organization, he knows the projects they have going now.
Now comes the sort of search to see who becomes sort of the permanent president.
GRE's whole job been to attract businesses that are looking to expand or move somewhere, and hopefully they come here.
>> As always, Matt, thank you for being with us today.
That is it for this week's edition of "Need to Know."
thank you for joining us.
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