Getting Our Money’s Worth: The Case for IDA Reform in New York State

Getting Our Money’s Worth: The Case for IDA Reform in New York State What Is An IDA? ► I D A = Industrial Development Agency ► Created by the NYS Government in 1969 to “advance job opportunities, health, general prosperity and the economic welfare of the people of the State of New York.” ► IDA Boards consist of mostly appointed (not elected) business people who are given the authority to provide companies a break on their state and local taxes or to help them get loans with low interest rates ► Originally intended to attract & retain industrial & manufacturing jobs

Getting Our Money’s Worth: The Case for IDA Reform in New York State Why Should We Care About IDAs? ► IDAs play a big role in our local economy and in the kinds of jobs that are available to us -- they drive economic development in most communities, providing over a half billion dollars worth of incentives ($584 million) to businesses in 2008 ► When IDAs provide tax breaks to companies, it means those companies don’t pay their property, sales, and other taxes or pay them at a very reduced rate—and not just for one year: they get year after year of breaks, often as many as 25 years

Getting Our Money’s Worth: The Case for IDA Reform in New York State Why Should We Care About IDAs? ► When companies aren’t paying their share of state and local taxes, there’s a greater burden on average people because our own property and other taxes rise to offset what the companies aren’t paying ► It also means there’s less money available to our local governments for our school boards to pay teachers and educate our students, to maintain our local infrastructure, and to attend other community needs ►Established in counties, cities, and towns across the state, there are 24 right here in the immediate counties of the Capital District, all of which are drawing on the local county and municipal governments as well as the state government

Getting Our Money’s Worth: The Case for IDA Reform in New York State What’s Wrong With IDAs? ► IDAs Have No Standards for the Jobs They Create. IDAs consistently award subsidies to profitable businesses that pay their workers low wages and/or contract with out-of-state construction contractors that don’t benefit our communities. For example, the Beechnut plant received $107 million from the Montgomery IDA last year and contracted its construction work to a North Carolina company that has severely undercut the area prevailing wage. ► Capital District IDAs Spent $3.4 million Last Year on Failing Projects that either failed to create or maintain jobs or actually cut jobs. With the amount of money wasted on these projects, 684 students could have been educated or 161 elementary school teacher salaries could have been paid rather than cut due to state and local budget crises.

Getting Our Money’s Worth: The Case for IDA Reform in New York State What’s Wrong With IDAs? ► More than half (56%) of Capital District IDA projects failed to provide full information to the NYS Comptroller on their job creation performance in 2007 as mandated by law. This means we don’t even know if they’re creating the jobs they said they would, much less if they’re quality jobs you can support a family on. ► Spending by Capital District IDAs has increased 23% in just three years, but it’s unclear what we have to show for it. For example, the Saratoga IDA had the worst job ratio in the state in 2007, projecting it would create 465 jobs through the projects it sponsored and instead those businesses actually cut 1,380 jobs in that one year alone. Nearly all 24 of those projects continue to receive tax breaks despite failing to live up to their end of the deal.

Getting Our Money’s Worth: The Case for IDA Reform in New York State What Can We Do About It? ► Option #1: The Deal by Deal Approach. Watch for notices buried in the back of the local paper and go to the hearings to keep an eye on what the IDA is doing, pick a fight over particularly important deals and hopefully win one every once in a while. ► Option #2: The IDA by IDA Approach. Work our way onto the IDA board and get information about deals earlier than the public so we can try to organize around more projects. Our rep can also push for policies or best practices to be established within the IDA which will create greater accountability and transparency and maybe even standards that dictate what types of projects the IDA will give breaks to.

Getting Our Money’s Worth: The Case for IDA Reform in New York State What Can We Do About It? ► Option #3: Statewide Reform. Change the rules of the game by establishing standards, accountability and transparency for all 115 IDAs at one time through state law. ► Standards: prevailing wages on construction work, living wages on permanent jobs, regional hiring requirements & apprenticeship programs, environmental & sustainability requirements all of which will ensure we’re supporting responsible businesses ► Accountability: clawbacks to take back subsidies when businesses don’t live up to their end of the deal, diverse IDA board representation, anti-raiding measures and enforcement mechanisms ► Transparency: increased monitoring and reporting to make sure IDAs and the projects they subsidize are doing the job right

Getting Our Money’s Worth: The Case for IDA Reform in New York State How Do We Win? ► Build a Statewide Coalition. State, regional and local labor organizations have joined with concerned advocates and community members from Western New York to Long Island, the North Country to the Southern Tier. There’s a strong local coalition here led by the Capital District ALF and working closely with the NYS AFL- CIO and other state coalition partners on a coordinated strategy. ► Educate Decision-Makers. Our coalition has been working together since 2005—and for some, decades prior—to educate state and local elected officials, doing hundreds of lobby meetings, forums, hearings, and other events. Legislation consistent with our coalition’s platform has been passed by the NYS Assembly in 2006, 2007, and 2008 and has been introduced in both houses this year and is moving in the Senate.

Getting Our Money’s Worth: The Case for IDA Reform in New York State How Do We Win? ► Shift the Public Debate. Not just any job is a good job—New York needs good jobs. In the last three years, we’ve gotten dozens of stories, opinion pieces, and letters to the editor published in papers across the state including the Albany Times- Union, Schenectady Gazette and Troy Record. We also released a full report in 2007 “Getting Our Money’s Worth: The Case for IDA Reform in New York State,” the findings of which have been emphasized and updated by the NYS Comptroller in both 2008 and ► MOBILIZE & ESCALATE! Hundreds of people have worked locally and in Albany to win statewide IDA reform—just earlier this week, nearly 1,500 members of the Building Trades were here advocating for prevailing wages and talking to their legislators about the best way to expand prevailing wage jobs this year: by securing IDA reform statewide.

Getting Our Money’s Worth: The Case for IDA Reform in New York State How Can You Be Involved? ► INDIVIDUALS 1. Write Letters to the Editor for Your Local Paper. 2.Contact Your Local and State Elected Officials. 3.Come Out for Coalition Events & Educate Others! ► ORGANIZATIONS 1.Send a Memo of Support on Thompson/Hoyt (S1241/A3659). 2.Get Senate Sponsors Signed On. 3.Fund the Fight. 4.Mobilize!

Getting Our Money’s Worth: The Case for IDA Reform in New York State