From the Morning Memo:

There’s been good news and bad news over the last week when it comes to Rochester’s role in the emerging photonics industry, and state and local leaders are working to reassure the community that the future for the industry still looks bright.

Friday, Empire State Development announced California-based Photonica and the 400 jobs it promised would not be coming to Rochester. The company, with subsidies from the state, was supposed to be one of the anchor tenants of an industry hub.

The project was originally under the supervision of the SUNY Polytechnic Institute, but was transferred to Empire State Development following allegations that former SUNY Poly President Alain Kaloyeros was involved in a bid-rigging scandal. The photonics project was not directly connected to those claims.

“ESD from the time it got involved with some of these SUNY Poly projects has had to do its own independent review and analysis,” said ESD President Howard Zemsky. “Not everyone of those companies is going to make it through that process. That’s all I’ll say about Photonica. We will designate those dollars for other photonics companies.”

ESD found that Photonica was too small to move forward with a project of this scale at this point, Zemsky said. But he insisted that losing the company at this early juncture shouldn’t have any long-term impact on the larger goal.

“Rochester is a significant sized economy and it leads in photonics,” Zemsky said. “We’ve got this national manufacturing institute literally hundreds of millions of dollars of federal money and state money. You’ve got tremendous research assets and a plethora of private sector employers who really deploy photonics as part of their technology.”

One of the governor’s State of the State proposals doubles down on that theory. Gov. Andrew Cuomo announced the state will establish a new Photonics Venture Challenge in Rochester.

It’s based on Buffalo’s 43North competition, but is aimed specifically at identifying and awarding start-ups in the photonics industry. The idea came from the Finger Lakes Regional Economic Development Council.

Greater Rochester Enterprise President and CEO Mark Peterson said this program was the council’s top priority for state funding. Peterson said it makes sense to base the competition in the region.

“We have a great strength; we have a historic strength,” he said. “Fifty percent of all the degrees ever given in optics and photonics were given through the University of Rochester.”

Peterson said despite the peaks and valleys, he’s pleased with how things are developing. He said 2017 will likely be a building year, but soon after the area will begin to see companies moving in and jobs created.