Western New York and the Finger Lakes region secured more than $70 million in state funding as part of Governor Kathy Hochul's announcement of $463 million in statewide economic development awards through the 2025 Regional Economic Development Council initiative, according to reporting by Rochester First published December 25, 2025.
The funding represents a significant boost for regional construction, infrastructure, and housing development projects across Upstate New York. The awards include more than $313 million allocated to 381 projects across the state, plus an additional $100 million from the inaugural Pro-Housing Supply Fund designed to support infrastructure upgrades that accelerate housing construction.
The Finger Lakes region was awarded $42.6 million to support 48 projects aligned with regional economic and housing priorities. Among the largest awards is a $2.8 million grant to the Village of Phelps to extend water and sewer infrastructure, which will directly enable a 144-unit housing development that would increase the village's housing stock by approximately 25 percent.
The Phelps water and sewer infrastructure project exemplifies how targeted utility investments unlock significant residential development. By removing the infrastructure barrier to housing construction, the state investment enables private sector development that substantially increases housing supply in a smaller Upstate community.
Additional Finger Lakes projects supported through this funding cycle focus on strengthening community infrastructure, expanding workforce development programs, supporting mixed-use development designed to address housing shortages, and encouraging private investment in underutilized downtown areas and corridors.
Western New York received $28.5 million to support 41 projects across the region, including significant awards for cultural preservation, workforce training, and community redevelopment. Among the most visible projects, the Niagara Orleans Regional Land Improvement Corporation received a $1 million award for restoration work at Rapid's Theatre in Niagara Falls, a historic venue expected to bolster downtown revitalization, tourism, and cultural programming.
The Rapids Theatre restoration project demonstrates the state's commitment to preserving historic architecture while catalyzing downtown revitalization. The restored theater will serve as an anchor for Niagara Falls' downtown entertainment district, attracting visitors and supporting related retail and hospitality development.
Beyond the Rapids Theatre, Western New York awards support workforce training programs aligned with regional industry demands, infrastructure improvements critical to business operations and residential development, community redevelopment efforts, downtown revitalization initiatives, and small business development programs.
A critical component of this funding announcement is the inaugural $100 million Pro-Housing Supply Fund, which specifically targets infrastructure improvements necessary to unlock new housing development. The fund prioritizes capital investments for sewer system upgrades, water infrastructure improvements, electrical system upgrades, and other critical infrastructure that enables housing development.
This infrastructure-focused funding approach recognizes that housing development often faces bottlenecks related to utility capacity and infrastructure readiness. By front-loading infrastructure investment, the state removes barriers to private residential development and accelerates the pace of housing construction.
The funding was distributed through the state's Consolidated Funding Application process, which aligns multiple state agency programs to support regionally driven economic strategies. This bottom-up approach allows local leaders and development organizations to shape funding priorities based on regional needs and opportunities.
Since the Regional Economic Development Council initiative launched, the program has awarded more than $8 billion to over 10,000 projects statewide, establishing itself as a major driver of regional economic development across New York State.
For construction professionals and development firms in Western NY and the Finger Lakes, these funding awards represent both current project opportunities and signals of sustained state investment in regional economic development. The combination of housing development projects, infrastructure improvements, and community revitalization work creates a robust pipeline of construction activity across multiple project types and scales.
The Pro-Housing Supply Fund allocation is particularly significant for construction professionals, as it prioritizes infrastructure work — site development, utility extensions, and system upgrades — that typically precedes and enables residential construction. This suggests sustained demand for both infrastructure contractors and residential construction companies in the region.
State officials emphasized that the investments are designed to address housing shortages, strengthen local economies, and support sustainable, long-term growth across both regions. The funding reflects recognition that housing availability and quality directly influence regional competitiveness for attracting and retaining both workers and employers.
By combining infrastructure investment, workforce development, and community revitalization support, the state is creating conditions for comprehensive regional growth rather than isolated development projects. This approach positions Western NY and the Finger Lakes for sustained economic development aligned with regional priorities and community needs.
Projects selected through this funding cycle will now move into implementation phases. Municipalities and organizations will secure final funding approvals, design engineering, permitting, and procurement processes over the coming months. Construction activity on infrastructure and development projects is expected to ramp up through 2026 and 2027.
For more on Rochester and Upstate New York construction news, see our coverage of the Rochester Convention Center $59.6M renovation project and the Buffalo Larkin District commercial development.
Additional information on the Regional Economic Development Council initiative is available from the New York State Governor's Office and regional economic development organizations.
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