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Ogdensburg Growth Fund eyes housing market as a platform for economic development

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The Ogdensburg Growth Fund Development Corp. is shifting its focus from primarily a small business lending agency to an economic development organization.

The agency, a nonprofit local development corporation, is working to distance itself from city government to be in a better position to develop the housing and business sectors.

“We want to grow [the fund],” said Mayor William D. Nelson, who sits on the Growth Fund Board of Directors.

To do that, the fund plans to purchase homes the city acquired for delinquent taxes, repairing and selling them.

City Manager and Growth Fund board member John M. Pinkerton said the fund has “the opportunity to preserve the neighborhood and preserve the tax base.”

Mr. Pinkerton said homes that fall into the city’s hands through unpaid taxes “are usually in disrepair. By the time the city gets it, it’s 18 months to two years after the person paid their taxes. You get something that really needs a lot of tender loving care.”

At a meeting Jan. 8 the Growth Fund began exploring the possibility of purchasing 611 Rensselaer Ave. from the city as a trial run of its new strategy. The fund will discuss the house further at future meetings.

“I think it’s our focus not to have any buildings go under that we can possibly save,” Mr. Pinkerton said.

Growth Fund Chief Financial Officer Philip A. Cosmo estimated that at any given time the city owns two to three homes acquired for back taxes.

Rather than paying to demolish the homes, Mr. Pinkerton said, the city could sell them to the newly repurposed Growth Fund.

“We’d be able to renovate them, sell them and get them back on the market,” Mr. Nelson said.

As soon as the Growth Fund takes ownership, the property would also return to the city’s tax roll, as the fund would be required to pay taxes on any home it owns, Mr. Pinkerton said. The funds revamped bylaws adopted last year will also see it reimbursing the city for services it uses and electing its own membership.

Previously the City Council appointed members to the Growth Fund board.

But there are lots of questions that need answering before the fund begins buying up homes.

Mr. Pinkerton said it’s still unclear who would be the property manager, who will monitor sales and who will do the necessary clerking.

The fund also wants to steer clear of becoming a land owner, Mr. Pinkerton said, though he noted that it may be necessary for them to hire staff as their role in economic development increases.

The “worst-case scenario,” Mr. Pinkerton said, is that the fund rents out homes that have been refurbished.

Mr. Cosmo said the fund is in an exploratory phase.

“Right now they’re just testing the waters,” he said.

With an adopted 2014 budget of $61,500, the fund is starting small and looking to expand slowly over several years.

“They’re trying to just be a proactive player,” Mr. Cosmo said. “[They’re] trying to see if they can do something to keep properties on the tax roll.”

Mr. Nelson said the Growth Fund is ideal for this sort of development because there is less red tape for a nonprofit than the city government when it comes to expanding the housing market.

“You want to expand the tax base, expand job opportunities,” Mr. Nelson said. “We have the vehicle to do that for the city.”

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