July 12, 2011
DiNapoli: Effectiveness of IDAs Still Questionable
Comprehensive Review of State and Local Economic Development Efforts Needed
Industrial Development Agencies (IDAs) reported they supported 4,577 projects and provided nearly half a billion dollars in net tax exemptions in 2009, for a cumulative gain of 204,000 jobs over the life of the projects assisted, according to a report examining the performance of IDAs released today by State Comptroller Thomas P. DiNapoli.
"For four years, I've called on IDAs to improve the accuracy of the jobs data," DiNapoli said. "Taxpayers should know if the projects they're paying for are creating the jobs that were promised. Year after year, we've had serious questions about the effectiveness of IDAs. We need to make sure that the tax breaks given for these projects are promoting job retention and growth.
"New York has a lot of local economic development entities; developing a regional, coordinated approach is very difficult. We have to fix that."
This is the fourth annual DiNapoli report examining the performance of the state's IDAs.The report analyzes the aggregate net tax exemptions provided by IDAs in each county compared to the aggregate property tax levy for each county and the total job gains or losses by county. The report found no apparent connection between higher tax exemptions and job growth.
DiNapoli noted that while there has been some improvement in the quality of the reports submitted by IDAs, shortfalls on the job data continue to impede the ability to evaluate the effectiveness of these economic development agencies. DiNapoli's report includes four recommendations for making IDAs more effective:
In addition to the 115 IDAs operating in the state in 2009, there are also 279 local economic development corporations, many of which were also created for economic development purposes. Some areas in the state have multiple IDAs and LDCs, including 40 such entities in New York City, 21 in Erie County, 19 each in Monroe and Westchester counties, and 14 each in Albany and Orange counties.
DiNapoli also announced the release of comprehensive financial and debt data for IDAs for 2009 and, for the first time, comprehensive financial and debt data for LDCs. The availability of LDC data is the result of reporting requirements under the 2005 Public Authority Accountability Act, as amended by the 2009 Public Authorities Reform Act.
Other findings of the IDA report include:
For a copy of the report, visit: http://www.osc.state.ny.us/localgov/pubs/research/idaperformance2011.pdf
Comprehensive 2009 financial and debt information reported by IDAs and LDCs is now available on the Comptroller's Web site at: http://www.osc.state.ny.us/localgov/datanstat/findata/index_choice.htm