Purpose of Audit
The purpose of our audit was to review the Agency’s process for evaluating, approving and monitoring projects and to determine whether the Board was effectively administering the Development Fund for the period January 1, 2014 through March 31, 2015.
The Syracuse Industrial Development Agency is an independent public benefit corporation established by a special act of the New York State Legislature in 1979 for the benefit of the City of Syracuse and its residents. The Agency, which is governed by an appointed five-member Board of Directors, reported a total of 67 active projects which received approximately $12.5 million in tax exemptions during 2014. The Agency also administers a Development Fund on behalf of the City for the purpose of financing commercial and neighborhood development projects.
- The Uniform Tax Exemption Policy (UTEP) does not contain all of the criteria the Board purportedly uses when evaluating proposed projects.
- Cost-benefit analyses do not adequately compare the community costs against expected benefits.
- The Board has no procedures in place to compare employment and capital expenditure goals, as stated in project applications, against actual results.
- The Agency’s audited financial statements show that over $2 million is due to the City from the Development Fund.
- Review and update the UTEP to ensure that it includes guidelines for claiming mortgage recording or sales tax exemptions and all applicable criteria necessary to make project evaluation decisions.
- Ensure that cost-benefit analyses compare the community costs of proposed projects to the expected benefits.
- Develop procedures to monitor and evaluate job creation and retention and capital investments to determine if projects are meeting the goals stated in their applications.
- Coordinate with the City to determine the extent to which the $2 million liability related to the Development Fund should be repaid to the City.