ALBANY – New York Comptroller Tom DiNapoli is taking aim at Industrial Development Agencies that give out tax breaks to lure in businesses. The state’s top financial officer says there is room for improvement in how IDAs operate, specifically when it comes to creating job in exchange for the tax breaks. DiNapoli claims that the tax giveaways, which can lead to government job cuts, aren’t balanced by the new jobs brought in. Supporters of IDAs fear companies would simply leave for less costly states or regions if not for the tax breaks.
According to DiNapoli’s office, in 2010, New York’s IDAs supported over 4400 projects and provided nearly $500 million in net tax exemptions, but projects were down and cumulative job gains decreased by 22,000 from the prior year. The report noted for the second straight year that there appears to be limited correlation between higher tax exemptions and job creation.
DiNapolis is proposing legislation that calls on IDAs to do a better job of highlighting the economic benefits of the projects that receive tax breaks. He says his legislative reform package would improve the effectiveness of IDAs while also enhancing their accountability.