OGDENSBURG — City officials are wary of rumors that the St. Lawrence Psychiatric Center could be closed as part of a state effort to reorganize the mental health system.

At issue is a proposal by Gov. Andrew M. Cuomo to establish regional “centers of excellence,” placing greater emphasis on outpatient care — which could result in closing some psychiatric hospitals.

If the St. Lawrence Psychiatric Center were targeted for closure, it would have deep repercussions for Ogdensburg’s rebuilding economy, Deputy Mayor Michael D. Morley said.

“It would be like the impact of General Motors shutting down in Massena,” he said. “It is a big thing. I just can’t imagine that the state would even consider closing the psych center.”

The center employs about 500 people.

“You’re looking at 500 good-paying jobs in the north country, in Ogdensburg,” Councilor Daniel E. Skamperle said. “It would be devastating, quite a blow.”

Many regional businesses benefit from the center’s presence in town.

“It would affect all the businesses that do business with those people,” Mr. Morley said.

Council members also expressed concern about the continued deinstitutionalization of the mentally ill in St. Lawrence County.

During a period in the 1980s when the psychiatric hospital was radically downsized, many of its residents became outpatients.

“Most of the people there are deinstitutionalized now. They’re walking the streets at all hours of night — and the ones that are out are not being watched,” Mr. Morley said.

The facility hosts an adult inpatient unit, a children’s unit and a separate facility for sex offenders.

Councilor Wayne L. Ashley said the center’s largest impacts on the city go beyond its inpatient units.

“They provide home care. They’ve established rehabilitation programs so clients can adjust to a normal lifestyle and get on their own,” he said. “It is an invaluable source. It would be quite amazing if they decided to close it. They do a little bit more than house clients here.”

A closure could open a large geographical gap in state mental health care, Mr. Ashley said. The closest psychiatric hospitals then would become Mohawk Valley Psychiatric Center in Utica and Hutchings Psychiatric Center in Syracuse.

“I think Ogdensburg can justify having a mental health facility here,” he said. “We’re the closest treatment center north of Syracuse.”

Mr. Skamperle said that restoring power generation at the cogeneration plant could ensure the center’s longevity by providing cheap electricity and heat.

“For the last three years now I have been trying to push to get that cogenerator back online, and I think that could be a big part in keeping the psych center, if we could get the cogenerator supplying heat to the state facilities,” he said.

City Manager John M. Pinkerton agreed.

“There is a resource there for combined heat and power. We have to put things together and make it work,” he said.

Mr. Pinkerton said the state might be better off naming Ogdensburg’s hospital a “center of excellence” and shuttering other facilities.

“If the governor is truly looking for ‘centers of excellence,’ the facility we have here in Ogdensburg is a ‘center of excellence’ based on client care and maintaining good programs,” he said. “I want to emphasize that if we already are a place that is doing exceptional work, let’s not talk about reduction; let’s talk about increases. This is an opportunity to grow. It is an opportunity to grow in an area that is pulling itself up by its bootstraps.”

City leaders are taking a “wait-and-see” approach.

“This is all brand new, and right now we’re trying to find out what is real and what is not real,” Mr. Pinkerton said. “Once we find out what’s real, we’ll either celebrate or we’ll collaborate.”

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