We all want to live in just, sustainable and prosperous communities. Our local and state governments have a responsibility to build a better future for all – that means making smart investments that revitalize the economy, create good jobs, and meet the needs of communities as a whole.
Each year New York State’s economic development programs give out more than $7 billion in corporate subsidies in the name of job creation. Too much of this money is wasted on corporations that fail to create good jobs and community benefits. That’s $7 billion taken out of our communities, schools, roads, public transit and services that we all rely on.
Dozens of disconnected agencies and job creation programs give public money to private businesses in exchange for businesses committing to create and retain jobs, make new investments such as expanding a business or purchasing equipment, or cleaning up polluted land. As a result of the decisions these programs make, corporations pay fewer taxes and communities are faced with reduced services and higher tax rates.
Industrial Development Agencies (IDAs) are the state’s largest job creation program. IDAs were created to foster local economic development by providing state and local tax exemptions and issuing tax exempt bonds to private businesses, often in return for creating or retaining jobs. Many IDA-subsidized projects receive tax exemptions for ten, twenty, or more years.
There are 115 IDAs in New York State. In Western New York alone, there are 14 separate IDAs: Allegany, Amherst, Cattaraugus, Chautauqua, Clarence, Concord, Dunkirk, Erie County, Hamburg, Lancaster, Niagara County, Niagara Town, Salamanca, and Town of Lockport.
Corporate subsidies from these IDAs take much-needed tax revenues from our local communities. In 2009 alone, Western New York’s 14 IDAs financed 702 projects, giving away $48.5 million in next tax exemptions. With that money we could:
> Fund the education of over 2,600 students for one year, or
> Retrofit over 3,700 small businesses for energy efficiency, save millions of dollars in energy costs and employ nearly 800 workers in the construction industry.
Far too often, IDAs give public subsidies to companies that fail to jobs. One half of all IDA-subsidized projects whose subsidy deals ended in 2010 failed to create a single job. The 14 IDAs in Erie County have subsidized hotels, dollar stores, car dealerships, office space, and other projects that fail to create quality jobs for local residents or grow the regional economy.
View our Western New York Industrial Development Agencies Case Study document to view a few of the most egregious examples of corporate subsidy abuse and learn about solutions.
It’s time to stop corporate subsidies form hurting our communities and stealing funding for schools, infrastructure, and other vital services. We must transform the way public investment is done in New York so that corporate subsidies create good jobs that provide a family-sustaining wage and real community benefits.
Get involved. Contact Andy at firstname.lastname@example.org for more information.