FOR RELEASE:

DiNapoli IDA Report: Jobs Data Still Needs Improvement

Calls for Additional Reforms to Enhance Transparency and Accountability

Industrial Development Agencies (IDAs) reported $66 billion in total project amounts in 2008, an 8 percent increase from 2007, and $645 million in net tax exemptions in 2008, a 9 percent increase from 2007, according to an annual report examining the performance of IDAs released today by State Comptroller Thomas P. DiNapoli. Because the most critical project performance metric – job creation and retention – still suffers from poor tracking and verification, DiNapoli is again advancing legislation to increase IDA transparency and accountability and minimize reporting discrepancies.

This is the third annual report released by DiNapoli examining the performance of the state’s IDAs.

“New York is slowly emerging from the Great Recession,” DiNapoli said. “It’s more imperative than ever that tax dollars are spent efficiently and effectively, especially when those dollars are being used to create jobs. The reporting requirements implemented by my office have helped paint a clearer picture of what IDAs are doing, and we’ve penalized IDAs that fail to report. But there’s still a lot of shadow surrounding IDAs. We need to spread a little more sunlight and transparency to make sure tax dollars are being spent in the most efficient way possible and that projects supported by those dollars are creating the most jobs possible.”

Fiscal year 2008 was the first year that the New York City IDA reported its data through the Public Authorities Reporting Information System (PARIS) – a standardized electronic financial reporting system. Inconsistent reporting by the New York City IDA resulted in significant changes in the numbers reported in 2008.

In 2008, DiNapoli suspended ten IDAs for failure to file complete reports. Five IDAs have since come into compliance: Town of Wallkill IDA, Town of Montgomery IDA, Town of Sidney IDA, Town of Southeast IDA and Village of Groton IDA. The remaining IDAs whose authority to offer state tax exemptions is suspended include: Town of Erwin IDA, City of Newburgh IDA, Town of North Greenbush IDA, City of Oneida IDA and Town of Waterford IDA.

DiNapoli said the 2009 Public Authorities Reform Act expands the reporting requirements for all state and local authorities, including IDAs. Financial reports will now include grant and subsidy programs administered by the authority, operating and financial risks, information on bond rating and long-term liabilities (such as employee benefits).

Other findings of the report include:

• Total Project Amounts Increased: In 2008, IDAs reported 4,471 projects worth nearly $66 billion, an increase of 8 percent from the 4,130 projects totaling nearly $61 billion reported in 2007. The largest IDA projects were in the cities of New York, Yonkers and Syracuse as well as in the counties of Oswego, Greene and Dutchess.
• Total Jobs Down, Cost per Job Up: Total estimated job gains in 2008 were 195,466 compared to 226,602 in 2007, a decrease of nearly 14 percent. The number of jobs reported by projects assisted by the New York City IDA reflects a loss of approximately 30,000 from reported jobs gained in 2007. However, this reduction is largely attributable to incomplete project reporting. The New York City IDA assisted 17 new projects in 2008, valued at $113 million, which were estimated to create 332 new jobs and retain 2,080 jobs.
• Total Tax Exemptions Increased: Net tax exemptions were $645 million in 2008 compared to $593 million in 2007 (after payments in lieu of taxes – PILOTs – were factored in).
• Debt Decreased: Outstanding debt was $21.6 billion, a small decrease from the $22.1 billion in 2007. Nearly half of this debt – $9.3 billion – was issued by the New York City IDA. The largest bond issue for any IDA project was $943 million for the new Yankee Stadium in New York City.
• IDA Projects Concentrated in Few Regions: The vast majority of project activity continues to be concentrated in a small number of IDAs. The ten largest IDAs had 2,186 projects or 49 percent of all IDA-assisted projects in the state. These ten IDAs, including New York City, supported $34 billion worth of projects, or 52 percent of the total projects statewide. In contrast, 27 IDAs reported fewer than 10 projects in 2008, three IDAs reported just a single project, and four IDAs reported no active projects at all.

IDAs are independent public authorities that offer real property tax, sales and mortgage recording tax exemptions, and low interest rate bonds to attract, retain and expand businesses. In 2008, there were 115 active IDAs.

For a copy of the report, visit: http://www.osc.state.ny.us/localgov/pubs/research/idareport2010.pdf

For project by project data, visit: http://www.osc.state.ny.us/localgov/pubs/research/idaprojects2008.xls

Comprehensive 2008 financial and debt information reported by IDAs is now available on the Comptroller’s Web site at: http://www.osc.state.ny.us/localgov/datanstat/findata/index_choice.htm.

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