Bit in Schenectady (3)
I believe the answer is:
tad
'bit' is the definition.
(both can mean a small amount)
'in schenectady' is the wordplay.
'in' says the answer is hidden in the clue.
'TAD' is hidden within 'schenectady'.
(Other definitions for tad that I've seen before include "(A) bit, touch" , "Slight amount" , "Small bit" , "Modest amount" , "A small amount (colloq.)" .)