New York Gov. David Paterson plans to reunify the state's main economic development agency under a single chairman, undoing a key strategy of his predecessor that many observers said had not been effective.

Former Gov. Eliot Spitzer appointed two co-chairs to the Empire State Development Corp. last year, splitting responsibility between the upstate and downstate regions.

"We've come to the conclusion in our discussions that the bifurcated system of taking economic development and dividing it up between two people around the state wasn't working," Paterson said on Sunday. "I'm sure one person can be sensitive to the issues all around the state."

Paterson said that a committee had been meeting to find a new chairperson but left it open whether or not that new person could be current upstate chairman Daniel Gundersen. Gundersen would not be leaving the ESDC, Paterson said.

Gundersen, who was recruited from Pennsylvania's Department of Community and Economic Development, has worked on the state's $700 million upstate revitalization program that will be funded primarily through bonds sold by the ESDC and the Dormitory Authority of the State of New York.

Last year Spitzer said appointing an upstate chairman would signal New York's commitment to revitalizing the depressed upstate region. Under the split system, downstate chairman Patrick Foye had overseen the corporation's activities in New York City, Long Island, and the Hudson Valley up to the Albany capital region, and Gundersen oversaw the rest of the state from an office in Buffalo. The ESDC continued to have a single board and shared staff. Foye resigned several days after Spitzer left office on March 12 following a prostitution scandal.

The split system has been "chaotic for external customers as well as for the staff of the agency," said Brian McMahon, executive director of the New York State Economic Development Council, a trade organization representing economic development professionals, organizations, and industrial development agencies.

"While we're recommending a unified management structure for ESDC, for one commissioner to lead it, it doesn't mean you can't have very strong, capable senior people leading economic development for upstate and economic development for downstate," McMahon said. "It's just that when decisions have to be made for allocating resources, there [should be] one person responsible for economic development for the whole state to make those decisions."

In a letter sent to Paterson in late March, McMahon urged the governor to appoint Gundersen to lead a unified ESDC.

"Once again Gov. Paterson is undoing one of Gov. Spitzer's foolish ideas," said Mitchell Moss, New York University professor of urban policy and planning. "Gov. Paterson is demonstrating that he knows more about economic development than Gov. Spitzer ever did. It made no sense to have two heads of the ESDC."

James Allen, executive director of the Amherst Industrial Development Authority in Erie County, said the split approach was good because the upstate economy has more in common with neighboring areas in Pennsylvania, Ohio, and Ontario, Canada, than with New York City.

"I'm a little disappointed because I believe there are two economies in New York," Allen said. "The idea of having two chairs, an upstate and downstate chair, made a tremendous amount of sense."

David Weprin, who chairs the New York City Council's Finance Committee, said he hoped Paterson would revisit the Javits Convention Center expansion that Spitzer had axed and added that whether the ESDC was split or unified was not the most important thing.

"The key is the emphasis on the projects," he said "There no reason to believe that that's going to change."


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