IDAs set the bar for accountability and transparency

IDAs are an important resource in efforts to revitalize New York's economy, especially the Upstate economy. Nearly every private project that the NY Governor's Office has announced in the last 18 months has been an IDA-assisted project. Some of these include: * General Electric * Buffalo Inner Harbor * Sikorsky Helicopter * General Motors * Corning Inc. * Beechnut * Pactiv * BAE Systems * Care stream IDAs assist projects for a number of reasons. Often it is to create new jobs. Other times however, it is to retain jobs. This is especially true with manufacturing projects. The General Motors plant in Tonawanda is a good example. By helping the facility reduce purchasing costs for re-tooling purposes, the Tonawanda GM plant was able to successfully compete against other GM plants that were vying to remain open. While not a lot of new jobs will be created as a result of this $300 million investment, the jobs that are there will stay, and the facility will remain in operation for the foreseeable future. And, when IDAs assist not-for-profit charitable entities, the benefit is not always new jobs. Often, the benefit is enhanced quality of life for residences of a community who have access to expanded recreational opportunities and after school programs at a YMCA for example, or mentally or physically disabled individuals who live in group homes or receive services at Cerebral Palsy Centers, such as those provided by Aspire in Western New York. The value of these projects cannot always be easily quantified in a standard cost-benefit analysis. Importantly, the IDA project approval process includes several steps that insure accountability and transparency. These steps include: * IDAs must conduct a cost/benefit assessment for all projects. * Those cost/benefit analysis and project descriptions must be made readily available to the general public. * An environmental review, including SEQRA review, must be completed for all applicable projects. * A public hearing must be held in the municipality where the project will be located. * 30 days notice must be provided to the public and to the chief executive officer of the affected municipalities and school districts of a public hearing. * All meetings of the IDA board are public and notice of those meetings must be provided to the public. * Tax exemption policies must be adopted with input from local taxing jurisdictions * Deviations from those policies must include notification to local taxing jurisdictions. * IDA budgets must be provided to the chief elected officer and legislative body prior to adoption. * Contractors of IDA projects must file annual reports with the NYS Department of Taxation and Finance detailing the value of sales tax exemptions claimed during the year. * New employment opportunities created as a result of IDA projects must be listed with NYS DOL community services division. * IDA directors serve at the pleasure of the chief elected officer and/or the governing body. * IDAs must have investment and procurement policies that comply with the Public Authorities Law. * All IDAs must file comprehensive annual financial statements and supplemental reports with the OSC. While these steps insure public input and a comprehensive assessment of the project, the public and others are demanding even more. That is why an important factor in our efforts to help New York's economy grow will be the degree to which businesses, the media, elected officials, and taxpayers have confidence that state and local economic development agencies operate transparently and effectively. NYSEDC takes this responsibility seriously. That is why we have developed a number of "best practice" recommendations that several IDAs throughout the state have already adopted. These include: 1. Posting all public documents and notices on the IDA's web site. 2. Information related to any project the IDA has assisted should be available on the IDAs web site, including type of project; project purpose; stimated jobs to be created and/or retained at time of application and actual jobs at time of report; value of IDA incentives provided cumulatively at time of report (i.e. Value of Real Property Tax, Sales Tax, and Mortgage Recording Tax abatements); project closing date; standard cost-benefit data; and value of estimated total project investment 3. All IDAs should request certain specific information on their applications. Additional information pertaining to the unique economic development conditions and goals of the region may be added to this base line of information. 4. IDAs should develop their own project selection criteria to guide decisions regarding which projects to assist. 5. IDAs should adopt "clawback/suspension" policies which would be included in the project application. Likewise, IDAs should develop job monitoring procedures to insure that businesses they help finance are providing accurate, up to date jobs information on an annual basis. And, 6. IDAs should re-authorize their Uniform Tax Exemption Policies every five years. Such reauthorization should include public notice and a public hearing. IDAs are powerful tools to encourage private sector investment and job creation. These "best practice" recommendations make IDAs leaders in New York in establishing open and transparent operating procedures. This will benefit the public, businesses that IDAs assist, and the communities they serve. Brian McMahon is president of the NYS Economic Development Council, Albany, N.Y.