State lawmakers push to end subsidies for industrial development agencies

Fiscal Policy Institute’s Ron Deutsch speaks about ending subsidies for IDAs at a press conference at the state Capitol Tuesday. (Ashley Hupfl/The Recorder)

Fiscal Policy Institute’s Ron Deutsch speaks about ending subsidies for IDAs at a press conference at the state Capitol Tuesday. (Ashley Hupfl/The Recorder)

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An earlier version of this story incorrectly stated that the bill would require industrial development agencies to pay property taxes on the land they lease. The bill would instead require the private companies that lease the land owned by industrial development companies to pay property taxes.

ALBANY – State lawmakers are raising awareness about a bill that would require private businesses that lease property owned by industrial development agencies to pay property taxes.

In New York, IDAs are allowed to acquire properties and lease them to private companies in exchange for payments in lieu of taxes (PILOTs). Because the properties are owned by a public agency, they pay no property taxes. School districts in New York get a large percentage of their funding from property taxes. 

At a press conference at the state Capitol Tuesday, good government groups, education advocates and the chairs of both the Assembly and state Senate Committees on Economic Development, Job Creation, Commerce and Industry pushed for a bill that would end that practice. 

“We are here today because schools in New York state are losing about $1.8 billion annually,” said Ron Deutsch, executive director of New Yorkers for Fiscal Fairness. “This legislation may not make it into the final package, obviously, as we wind down the legislative session over the next couple of days, but we want leadership to know and others to know that we are not going away.”

Similar legislation has already gone into effect in Florida, Louisiana and Alabama.

Deutsch joked, “Can we please just catch up — I never thought I’d say this in my life — to Florida, Alabama and Louisiana on this important new critical policy issue?” 

A report from Good Jobs First released last year analyzes how much school funding was lost due to IDAs in 2021 — the last year data was made available. The report estimates school districts in Schenectady County lost between $5 million and $10 million in 2021 due to IDAs. School districts in Saratoga and Schoharie counties lost an estimated $1 million to $5 million. Montgomery County lost an estimated $500,000 to $1 million, and Fulton County lost, at most, an estimated $500,000. 

Assemblyman Harry Bronson, D-Rochester, called education the great equalizer in our society and argued all funding that can, should go toward schools. 

“I grew up in a home, when I was young, with no indoor plumbing, and we heated the home with wood-burning stoves. Education was the way for me,” Bronson said. “Education today is the way for many of our marginalized communities to help quality of life and to be able, through education, to advance as individuals.”

State Sen. Sean Ryan, D-Buffalo, said he believes one reason the bill has not gotten more traction is due to the lobbying efforts by IDAs.

“There’s over 160 IDAs in the state. So, you can also look at that as there’s 160 groups lobbying against us, and they also pooled their money together,” Ryan said. “They can give away the public’s money with no accountability and pay massive salaries. Who wouldn’t fight against change if you’re in that position?”

By Ashley Hupfl

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