The Comptroller’s just-published annual report on New York’s host of 107 Industrial Development Agencies (IDAs) is a snapshot of 2021 data disclosed to the Public Authorities Reporting Information System (PARIS). This was the year of complete COVID lockdown, so we won’t be drawing any big conclusions about IDA subsidies and the economy. However, we remain extremely skeptical about the benefit of IDAs and strongly suspect most places would be better off without them.
According to OSC’s reading of PARIS data, there are 107 active IDAs in the state running 2,324 projects. In 2021, those IDAs handed out a total of $1.9 billion tax exemptions which took $1.1 billion in new net tax exemptions away from the revenues of local governments. This is a 10.4% increase over 2020. From 2011 to 2021, the average IDA project’s value increased a whopping 76%. The report does not say why, but it might be partly due to the mega-subsidy deals for Yankee Stadium in the Bronx and Citifield in Queens.
The Comptroller also spotlights county IDA audits. In 2022, the Comptroller audited six IDAs. All those audits found significant deficiencies in project approval and monitoring practices. This leads us to a bigger question: How many more IDAs aren’t adequately tracking project approval and progress? If the Comptroller audits only six IDAs a year, it could take more than 17 years for the Comptroller to audit all IDAs in the state! So, what else is going on with these unaccountable IDAs?
New York Corporate Giveaway News:
- We know Opportunity Zones don’t help poor communities, but Timothy Weaver digs into the details and history, and also provides some possible solutions.
- The Community Benefits Agreement (CBA) negotiated as part of a deal to give the Buffalo Bills a taxpayer-funded stadium relies on the good faith of an oversight committee and doesn’t clearly lay out how county residents can benefit from the new stadium.
- The plan to revamp NYS Thruway rest stops – a plan that wasn’t supposed to cost taxpayers a dime – isn’t working out, and now the contractors want a $260 million taxpayer bailout.
- New York shelling out cash for Micron was part of a larger trend; states are giving away more and more taxpayer money to multibillion dollar corporations, igniting a “subsidy war” between states.
- Local news is struggling, and NY lawmakers think tax credits – direct payments from taxpayers – are the best way to save it.
Fun Fact: IDAs fund themselves with fees on the businesses getting handouts. This creates a conflict of interest; instead of putting taxpayers first, IDAs have an incentive to hand out more and more subsidies.
If you got this from a friend, sign up here. Subsidy Sheet is written by Elizabeth Marcello and edited by John Kaehny.