When Governor Andrew Cuomo proposed a series of reforms for the state's industrial development agencies, IDA representatives and local elected officials protested. Cuomo essentially wanted to restrict the agencies' ability to grant exemptions on state sales tax, but local officials said that would rob them of a useful economic development incentive.
Well, perhaps predictably, Cuomo's proposal didn't stick; lawmakers negotiated and passed a compromise reform package last week.
In his 2013 to 2014 budget proposal, the governor said that the state doesn't currently have input when IDA's award state sales tax exemptions. He proposed limiting the industries that could receive the exemptions: housing and retail would no longer have been eligible. He also wanted the regional economic development councils and the state economic development commissioner to sign off on the exemptions.
But the final legislation is quite different from that proposal: IDA's will still be able to award state sales tax exemptions and no additional approvals will be required. The agencies will have some additional reporting requirements, but they won't face much in the way of restrictions on which industries can receive tax benefits. Some analyses of the legislation say it prevents IDA's from giving state sales tax exemptions to some retail projects.
IDA representatives and many local elected officials — though not all — are counting the outcome as a victory. But Brighton Supervisor Bill Moehle says he's disappointed that the governor's proposed reforms didn't stick. Brighton officials have been critical of the Monroe County IDA in the past, saying it awards tax breaks to inappropriate projects.
"I like the idea of having the state oversight on the sales tax," Moehle says.