How much longer should economic development organizations be able to get away with irresponsible and ineffective use of billions of dollars of taxpayer money while failing meet criteria for filing reports, accuracy and transparency?
The answer, apparently, is forever, given the way many industrial development agencies and public authorities continue to flounder in their mission to boost local economies and create jobs.
The Authorities Budget Office released its annual report last week that once again pointed to incomplete and inaccurate data reported by authorities — if the authorities bothered to file reports to the state at all, as required.
In addition, the watchdog group reviewed a sampling of projects and found numerous data errors, indicating that even when reports are filed, the public can’t always trust the information.
These issues are costing us all plenty.
In 2017, the state spent more than $8.6 billion through direct spending and tax incentives for economic development, according to the nonpartisan, nonprofit Citizens Budget Commission. IDAs and Local Development Corporations (LDCs) make up more than a quarter of the cost of economic development statewide.
The return on the taxpayers’ investment has been spotty at best, as been compliance with rules.
Yet state legislators — despite years of evidence demonstrating the ineffectiveness of the state’s economic development system — are doing little to provide solutions that could make the state’s efforts more efficient, effective and accountable to the public.
Since these economic development initiatives are designed to improve state and local economies and create jobs and revenue in their respective legislative districts, we wonder what the holdup is.
We’ve already recommended the state create a Database of Deals that would show the public exactly how much the state spends and whether economic development entities are fulfilling their promises to create business and jobs in exchange for taxpayer money.
But the Citizens Budget Commission also recommends other reforms, including that the state establish a comprehensive, unified economic development budget that shows the cost of economic development for the past year and the projected cost of all economic development programs for the coming fiscal year. It also recommends the state use a standardized measure of performance for all economic development efforts; pay benefits retroactively, after a company has produced results; regular review of economic development projects and administrative reforms to the system.
If insanity is doing the same thing over and over again and expecting different results, then the way in which the state invests in and oversees economic development is nuttier than a fruitcake.
Lawmakers can continue to do nothing to fix the system, and therefore continue to waste taxpayer money. Or they can fix it.
What’s it going to be?