One Sunset and IDA Reform

IDA RallyEarlier today I attended a press conference to support reforming Industrial Development Agencies statewide.  These agencies play the lead role in economic development in NYS, granting some $400 million in subsidies and incentives to businesses who promise to provide increased employment and opportunity for state residents.  The rally was organized by the good folks at the Coalition for Economic Justice, as part of a statewide campaign.

So what’s wrong with giving away tax  breaks and subsidies to create jobs?  Nothing, unless you’re a strict libertarian.  The problem is that so few of these deals actually produce the benefits they promise.  In fact, a 2006 audit found that only 1/3 of these projects met the job creation targets on which they were premised, and another 1/3 actually ended up losing jobs.

On top of that, the state has 115 different IDAs while Western New York has 6 of its own.  The result is that, in typical NYS fashion, services are duplicated and agencies fight amongst themselves to protect turf rather than working for the greater good.

Just recently, the One Sunset scandal has shed some light on how the Erie County IDA makes its decisions.  It ain’t pretty:

City officials, including Barron, urged the Erie County Industrial Development Agency to loan the restaurant $50,000 without disclosing the restaurant was on the brink of closing. The IDA made the loan without checking financial statements or public documents showing One Sunset was in trouble.

Wow.  Maybe I can get IDA money to start my own business — say, a blog — without submitting financial information or having a sound business plan.  Never mind — I’m not connected to Byron Brown.

An IDA reform bill recently passed in the State Senate, and our own Sam Hoyt is sponsoring a similar bill in the Assembly.  The business community is up in arms, of course, because the free market demands that private businesses should receive taxpayers dollars with no guarantee of actual public benefit.  Sam spoke at the press conference.

That's an activist podium, nothing fancy like the mayor's . . .

That's an activist podium, nothing fancy like the mayor's . . .

Advertisements

Tags: , , , ,

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s


%d bloggers like this: