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Legislative Memo

Ken Pokalsky
Senior Director Government Affairs
T 518.465.7517 x205
www.bcnys.org

BILL:

S.1241 (Thompson) / A.3659 (Hoyt)

Support

SUBJECT:

Industrial Development Agencies

 

DATE:

April 6, 2009

 

The Business Council of New York State strongly opposes S.1241 (Thompson)/A.3659 (Hoyt), legislation that would significantly change requirements for providing economic development incentives through industrial development agencies.

It is hard to imagine that the legislature could send out a less positive message to prospective investors in New York than by adopting the excessive standards and compliance burdens proposed in this legislation.

On the heels of a budget agreement that adds substantially to the cost of employer-provided health care and electric power - two key competitiveness factors for in-state business – and that limits the availability and value of Empire Zone incentives, this legislation sends the absolutely wrong message to businesses and investors, and will impair the ability of New York State to participate in the national economic recovery.

We agree that the state should require “transparency” in the use of public resources, demand a reasonable return on its investments in economic development, and impose reasonable performance and compliance criteria on recipients of economic development incentives.

However, in provision after provision, this legislation goes well beyond the “reasonableness” test, and imposes excessive, and in some cases unachievable, requirements.
Provisions of greatest concern to The Business Council include:

While the bill includes several reasonable new procedural, administrative and reporting requirements, its excessive performance requirements would render IDA financing an unviable option for many potential investment and reinvestment projects.

We believe this legislation would take New York in a direction opposite that of other states, which are taking steps to enhance their economic development incentives and business attraction efforts.

The Business Council welcomes to opportunity to work with the Legislature and the Administration in re-crafting the state economic development programs to make them more effective, more efficient, and more transparent.  Despite some positive proposals, we believe the overwhelming negative nature of this bill makes it a poor starting point for such negotiations.

For these reasons, The Business Council strongly opposes approval of S.1241/A.3659.