Four Subsidy Stories You Might Have Missed This Week
1. New York State taxpayers may have to spend $1 billion for a new Buffalo Bills stadium versus only $200m from the billionaire owners, the Pegulas, and $150m from the NFL (Buffalo News). The state’s own analysis last year said the new stadium would do next to nothing for the Buffalo region’s economy.
“We’ll be able to find the resources in the budget,” Hochul said Friday. “There’s unrestricted money, there’s money for economic development, there’s money for infrastructure. So there are various sources. We’ll be able to identify what is needed to ensure that the Buffalo Bills stay here in Western New York.”
2. Vornado has sought to build a massive development around Penn Station for decades and is pushing Governor Hochul’s proposal to build ten new tax-free towers (The Real Deal). Last week, Reinvent Albany and six other watchdogs called on the state to pause the project until its cost to the taxpayer, impact on NYC revenue and subsidy to Vornado are fully revealed.
On the seventh floor of Vornado Realty Trust’s office building Penn One is a 12,000-square-foot showroom dedicated to CEO Steven Roth’s dream: to create a grand office campus surrounding Penn Station. Over the decades, Roth has given it pet names including “Vornadoland,” “the promised land” and “the big kahuna.” He has called it Vornado’s “moonshot,” its “bullseye.” “All this will take time but will be enormously rewarding to the patient investor,” Roth wrote to shareholders in 2018.
3. NY State may finally be cracking down on businesses falsely claiming to be owned by women. An analysis by the Buffalo News found the number of WBE applications being rejected is now double that for minority-owned businesses.
It has been whispered at construction sites across New York for decades. Want access to lucrative government contracts? Put your business in your wife’s name. But lately, New York State has been booting from its programs companies it says are not authentic woman-owned business enterprises, or WBEs, because the husband, father or brother of the female owner controls the company.
4. Tim Bartik and Kathleen Bolter at the Upjohn Institute for Employment explain how states can bring more jobs to distressed regions including focusing on public services over business subsidies, and reducing existing business subsidies (Governing).
State governments, even if they don’t remain flush with cash from the COVID-19 recovery funding and new infrastructure money, have the power with their own resources to adequately target distressed communities. States already devote around $50 billion per year to costly business tax incentives that mainly go to booming communities. That budget is sufficiently large that if cost-effectively targeted at distressed communities, states could cut in half the employment-rate gap between distressed communities and the U.S. average.
If you got this from a friend, sign up here. Subsidy Sheet is written by Tom Speaker, Policy Analyst at Reinvent Albany. Please send questions and tips to tom@reinventalbany.org. We look forward to hearing from you!