With IDAs the Issue is Accountability

Written By: Talk of the Sound News

During these trying times it was disheartening to read the second annual report on Industrial Development Agencies (IDAs) released by Comptroller Thomas P. DiNapoli.  He has promised to increase oversight of IDAs and suspended nine in 2008.  He now feels, “more needs to be done to increase transparency and accountability and to measure the value of IDAs.”

The total amount of projects, tax exemptions and average cost per job “have all increased, while the estimated number of jobs created has declined by approximately 2000 jobs” according to the report.  Yonkers has had a significant increase in IDA activities amounting to over two billion dollars with a cost per job of $12,290.  With nearly $57 million in projects, New Rochelle’s rank in cost per job was virtually unchanged, third highest in the state at $26,077 for an estimated 310 job gain.  This cost per job is about six times higher than the state average of $4,527 and many more times the median cost per job in the state of $1,288.

DiNapoli’s report states that job figures are “based upon estimates made by the IDAs” and often are not verified.  An improvement has been made to address some of these issues.  IDAs will not be able to revise employment goal data.  A project must report if it has multiphases with gains and losses of jobs.  For example, when construction jobs phase out, new jobs may be created as the project is completed.  IDAs will now be able to recoup benefits given if the project does not create the promised number of  jobs and  maintain its retention goals. 

Amounts of PILOT (payments in lieu of taxes) actually paid and how much the developer had agreed to pay will be required to determine if the terms of the financial agreement are being met.  IDAs must now also report “estimated salary” for all jobs, whether newly created or retained.  Assemblyman George Latimer stated, “I support making IDAs more accountable for the benefits they grant and more accountable to the taxpayers who underwrite these benefits.” 
In New Rochelle Councilman Lou Trangucci, District l, has been strongly in favor of modifying IDA rules to make then more accountable to the residents.  He said that presently after the City Council has approved the plans, the developer can go directly to the Planning Board and the IDA for PILOTs. This leaves the people with no accountability.  The City Council should have the final decisions.  In that way the Council would be responsible and residents can hold them accountable.  At present, “the public has no one that is accountable,” Trangucci stated.

Residents of New Rochelle can remember how skeptical they were when one developer was claiming that he would bring the now defunct Circuit City to one of his downtown projects which sought IDA benefits.  Bob Petrucci is a research product management consultant.  He felt “a lot of harm has been done by IDAs.  From whatever polling I’ve done, most people seem to feel the same way.  Therefore, the only logical conclusion would be that the City Council should have control and there should be a referendum on these projects.”

One thought on “With IDAs the Issue is Accountability”

  1. The role and creation of the
    The role and creation of the IDA’s within NY State was to give a economic boost to rural NY State area’s. IDA stands for Industrial Development.
    The concept was to create manufacturing jobs where they would attract out of State Manufacturers to set up shop. As our Country Changed over from Rust Belt to Service Orientation some modifications were made to the process. Never was the intention to create corporate welfare. There has not been an update of Policy for IDA’s and frankly the NY State Senate and Assembly can’t agree on what rules and proceedures should be enacted into law. It is a mess. Only when something crosses over the line to illegality does NY State even open one eye. The PILOTS and Tax incentives currently come with zero oversight. Giving New Rochelle City Council control does nothing it only furthers Mayor Bramsons position of Cappellitization becasue the Mayor owns the majority. It nice that Trangucci wants Council Oversight but unfortunately as a minority it will be PILOTS as Usuall. I am for New Rochelle’s IDA being disbanded and prefer a Regional approach thus eliminating the deals. Unfortunately Trangucci does not have the power in votes to stop the madness. It will only produce the same results.

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