Watchdog Seeks Cuts to Opportunity Zones and
Weaning from Film Tax Credit
Proposes More Funding for ABO;
Accountability & Transparency for State and Local Authorities
Reinvent Albany called for sharp reductions to the $10 billion in annual business subsidies provided by New York State and local governments in testimony to the legislature’s Joint Legislative Hearing on Economic Development. The watchdog group cited evidence from researchers across the political spectrum that government subsidies to businesses largely do not work. Reinvent Albany says it is absurd New York State is providing $4.5 billion in subsidies to businesses while the state government is running a $6 billion budget deficit.
The government watchdog called on the state to not provide capital gains tax credits to the Trump Administration’s deeply flawed Opportunity Zones program.
Reinvent Albany also wants to wean Hollywood from New York taxpayers by reducing by 5 percent annually the total outlays for the $420 million Film Tax Credit. Thirteen states have eliminated their film tax credits in the last decade.
Reinvent Albany also requested the legislature hold a hearing on business subsidies and outdated tax expenditures like the over $1 billion subsidizing the use of oil and gas. The groups says the legislature should invite independent experts from across the nation to testify on the failure of business subsidies to change corporate decision-making and provide a meaningful return on investment by the state in most cases.
The Governor and legislature should also raise the Authorities Budget Office’s fiscal allocation to over $3 million, as it falls short of what the legislature called for in 2009 when it renewed the law establishing the Office.
The ABO is a critical watchdog of authorities, including Industrial Development Agencies (IDAs) and Local Development Corporations (LDCs), both of which the Senate and Assembly have shown an interest in reforming. Reinvent Albany supports 10 reforms in the Senate committee report investigating IDAs, including authorizing county comptrollers to audit IDAs and requiring IDAs to respond to ABO investigative reports.
Reinvent Albany also called on the legislature to refuse to renew the Economic Development Corporation’s authority to provide loans or administer the Empire State Economic Development Fund, as proposed in the Executive Budget, unless ESD promulgates rules on criteria for giving out the funds, and posts MOUs and project applications online.