Subsidy Sheet: Plug Power requests $1.7M per job in government subsidies
Plug Power Inc Wants Whopping $1.7M Government Subsidy Per Job for Upstate Plant
Last week, Governor Cuomo announced in a press release that the Genesee County Economic Development Center (GCEDC) would provide “additional local tax incentives” for Plug Power to build a green hydrogen plant at an industrial park between Buffalo and Rochester. What the release didn’t mention is that Plug Power’s requested tax incentives would cost $1.73 million per job.
GCEDC revealed Plug Power’s application details in a blog post this morning: Plug Power requested GCEDC provide $118.2M in various sales and property tax incentives for the creation of 68 jobs. The Governor’s press release only highlights the $2 million in state Excelsior tax credits plus low-cost energy from the New York Power Authority.
GCEDC will decide whether to consider Plug Power’s initial application at an upcoming meeting on March 4th. Coverage in the Investigative Post has revealed concerns with GCEDC’s handling of the proposed site, such as its distance from the potential workforce, the lack of interest from companies, and the $50,000 cost of a sign at the site’s entrance.
Developers Get Census Tracts Expanded for Govt Opportunity Zone Subsidies (They Can Do That?)
Incredible reporting in Bloomberg last week revealed yet another way that the Opportunity Zone program has been exploited: Developers have tried to get the Census Bureau to expand census tracts to include certain properties in Opportunity Zones.
Unfortunately, the process is completely legal: Under the Participant Statistical Areas Program, regional planning groups and civic governments can ask the Census Bureau to redraw certain tracts for reasons such as changes in population or infrastructure. But in 2020, some developers asked local governments for changes to the tracts that could make properties eligible for the Opportunity Zones tax break. In Baltimore, due to the merger of two tracts, a previously ineligible 3,300-acre logistics facility may now qualify for the tax break.
One of the foremost criticisms of Opportunity Zones, which are supposedly intended to benefit low-income communities, is that Opportunity Zones are frequently not even in low-income communities. Beneficiary projects are often high-end real estate, are in the high-income neighborhoods of low-income tracts, or are in college towns whose “low-income” residents are students.
OZ Tax Break-Qualifying Towers Would Cast a Shadow Over Brooklyn Botanical Garden
Two buildings, 34 stories, and the ability to block out the sun and kill thousands of plants? Sounds like the perfect property to receive an Opportunity Zone tax break.
The City reported last week on a proposed development from Continuum Company that would be eligible for the Opportunity Zone tax break. The developer has received pushback not only for the property’s 34-story height, which would threaten plant life at the Brooklyn Botanical Garden, but also for the fact that it would receive the Opportunity Zone tax break with virtually no support from the community. As local Senator Zellnor Myrie put it, “Herein lies the problem with Opportunity Zone giveaways — developers see a financial opportunity that purports to benefit the immediate community, even when that community is in staunch opposition to that development.”
The developer recently submitted alternate proposals for the zone that would lower the buildings’ height but include no affordable housing.
Other subsidy news
- Pew reports on research finding that Opportunity Zones don’t boost economic activity.
What we’re reading
- At Boondoggle, subsidy whiz Pat Garofalo breaks down the effort by lawmakers in 11 states – including New York – to end subsidy competition across states.
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