Economic development agencies faulted in report

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ALBANY — A state watchdog has released its annual report on the hundreds of state and local authorities that promote economic development at taxpayer expense in New York.

The Authorities Budget Office noted that its report was flawed because the data is self-reported, incomplete and in some cases inaccurate. The ABO said dozens of the authorities that are legally required to submit reports did not; also, when it reviewed a sample of 25 projects, it discovered data errors in three quarters of them.

Some of the authorities subject to ABO oversight run airports or water systems or perform other administrative roles, but most are economic development organizations such as industrial development agencies. The ABO offered familiar criticism of these economic developers, noting that the return on investment of taxpayer dollars is sometimes light.

“The report recommends that the role of IDAs in the State’s economic development program needs to be thoroughly reviewed and re-evaluated,” it reads. “IDA boards need to adhere to their fiduciary duty and ensure that projects they approve are in line with the mission and purpose, that appropriate results are obtained, and that accurate data needs to be reported to ensure that the IDAs are transparent to the public and accountable for their decisions.”

The 2018 report repeats an observation made in previous years’ reports: That the rate of job growth in a county may have little corelation to the economic development efforts in that county.

In 2013 to 2017, counties in New York state averaged 7.9 percent private-sector job growth, the report said, citing the U.S. Bureau of Labor Statistics. But the great majority of jobs created were in New York City, inflating the average — the rest of the counties averaged only 4.1 percent.

The highest-performing county in the Capital Region from 2013-2017 was Saratoga County, which saw 9.2 percent job growth while IDAs there assisted 21 projects. But second-highest was Schoharie County, which had 7.6 percent job growth while only two projects got IDA assistance.

Fulton County managed only 1.8 percent job growth with one IDA project but neighboring Montgomery County saw 6.5 percent growth with three IDA projects.

Lowest in the Capital Region was Schenectady County, which had 1.4 percent job growth amid 15 IDA-assisted projects, plus the continued work of the Schenectady County Metroplex Development Authority, a well-funded agency that is the envy of many other counties.

Metroplex Chairman Ray Gillen said his agency’s record of economic development and job creation is strong in projects great and small, but he conceded previously existing jobs may have been shed even as new ones were being created, lowering the net workforce increase. 

The goal is to develop the community as a whole, he said, to add not just the light industrial company with 300 workers but the new storefront merchant with five workers, or a new attractive residential building with only two on-site jobs. This brings people into the community and generates tax revenue that didn’t previously exist.

“We’re rebuilding the capital stock of the community, especially the city,” Gillen said.

Meanwhile, the Schenectady County IDA (which is administered by Metroplex) made one of the self-reporting errors about which the Authorities Budget Office budget office warned. It reported awarding $327,050 worth of incentives for a $7.3 million construction project but actually provided only $93,347. 

That was human error, Gillen said.

DETAILS OF REPORT

Here are some Capital Region statistics from “Annual Report on Public Authorities in New York State,” the July 1 report by the state Authorities Budget Office:

2017 PROJECTS 

The following are Capital Region industrial development agencies, the number of new projects in 2017, the net value of tax incentives granted, and the number of jobs expected to be created:

• Albany City IDA 3 $1.38 million 9
• Clifton Park IDA 1 $214,944 30
• Fulton County IDA 1 $964,763 27
• Guilderland IDA 2 $709,230 152
• Rensselaer County IDA 3 $1,14 million 162
• Saratoga County IDA 3 $0 117
• Schenectady County IDA 1 $327,050* 2
• Schoharie County IDA 1 $0 30
• Warren/Washington Counties IDA 3 $271,861 59

(*Reporting error: The Schenectady County IDA incentives actually totaled only $93,347.)

THE WORKFORCE

The following statistics are private-sector job totals by county and state in 2017, the percentage change from 2013, and the number of projects approved by IDAs in those counties from 2013 to 2017:

• Albany 172,685 6.9% 39
• Fulton 13,535 1.8% 1
• Montgomery 16,972 6.5% 3
• Rensselaer 41,302 4.6% 37
• Saratoga 74,083 9.2% 21
• Schenectady 53,451 1.4% 15
• Schoharie 6,243 7.6% 2
• New York state 7.74 million 7.9% 1,704
• State outside NYC 4.03 million 4.1% 1,558

OPERATING EXPENSES

The following are budgets of various Capital Region authorities in 2017 and the percentage change from 2013:

• Amsterdam IDA $450,000 39.3%
• Clifton Park IDA $20,000 -10.5%
• Fulton County IDA $110,000 181.8%
• Metroplex Authority $1.22 million 19.2%
• Montgomery County $660,000 499.2%
• Saratoga County IDA $111,000 -32.0%
• Schenectady City IDA $70,000 155.1%
• Schenectady County IDA $30,000 -17.3%
• Schoharie County IDA $70,000 2.6%

PAYROLL NUMBERS

Below are listed the number of staff members employed at local authorities in 2017 and their combined total compensation:

• Albany County Land Bank Corporation 5 $261,096
• Amsterdam IDA 3 $120,791
• Amsterdam Urban Renewal Agency 1 $11,579
• Fulton County Center for Regional Growth 5 $223,410
• Fulton County IDA 1 $20,352
• Mechanicville-Stillwater IDA 2 $2,000
• Metroplex Authority 6 $ 532,378
• Montgomery County IDA 3 $33,000
• Saratoga County Prosperity Partnership 4, $273,280
• Schenectady City IDA 2 $0
• Schenectady County IDA 2 $0
• Schoharie County IDA 4 $25,031

DEBT CARRIED

The following is the total outstanding debt in 2017 of Capital Region authorities and the percentage change at each from 2013:

• Amsterdam IDA $12.72 million 833.5%
• Clifton Park IDA $0 -100%
• Colonie IDA $5.16 million -21.7%
• Colonie Local Development Corporation $34.27 million 55.8%
• Fulton County IDA $2.33 million -70.9%
• Metroplex Authority $56.57 million 23.7%
• Montgomery County IDA $0 -100%
• Saratoga County Capital Resource Corporation $109.37 million 387.6%
• Saratoga County IDA $49.43 million -58.5%
• Schenectady City IDA $4.64 million -89.9%
• Schenectady County Capital Resource Corporation $103.6 million 63.0%
• Schenectady County IDA $8.64 million -53.7%
• Schoharie County IDA $0 100%

THE HOLDOUTS

The following obligated entities failed to file reports in the Public Authorities Reporting Information System as of July 1, 2018:

• Albany Community Development Agency
• Albany Municipal Water Finance Authority
• Albany Water Board
• Amsterdam Industrial Development Agency
• Corinth Industrial Development Agency
• Crossroads Incubator Corp.
• Fulton County Economic Development Corp.
• Glenville Local Development Corp.n
• Mechanicville Community Development Agency
• Saratoga Springs City Center Authority
• Schoharie Community Development Corp.
• Town of Waterford Capital Resource Corp.
• Village of South Glens Falls Local Development Corp.

The following have indicated their intention to dissolve but have not; they are required to submit reports until they dissolve but did not:

• Castleton-Schodack Local Development Corp.
• Johnstown Economic Development Corp.
• Village of Waterford Local Development Corp.

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Categories: -News, Business, Schenectady County