State report: More than 46,000 people hired on LI because of IDA tax breaks

Long Island's industrial development agencies helped create more jobs than IDAs in any other region of the state, according to a new report. 

In its annual review of IDAs, the office of state Comptroller Thomas P. DiNapoli found 46,860 people had been hired locally as of the end of 2017 by businesses, housing developments and other projects backed by one of the Island’s eight IDAs. That represents nearly 24 percent of the 198,522 jobs created statewide by IDA projects.

The hiring took place over multiple years because IDAs award tax breaks for 10, 15 or 20 years, depending on the project's size and the number of jobs to be created and retained in return for the aid. Companies' failure to keep employment promises can result in tax breaks being clawed back.

Long Island led the state's 10 regions in IDA-related job creation in 2017 for the third year in a row.

In recent years, IDAs in Nassau and Suffolk counties have come under fire for aiding automobile dealerships, self-storage facilities and housing projects that create few permanent jobs and, in some instances, pay low salaries.

DiNapoli said Wednesday, “The need for close scrutiny of economic development efforts has never been higher.” He urged taxpayers to “examine if incentives given out to create and retain jobs in their communities are worth it.”

The comptroller noted that among the dozens of bills introduced into the State Legislature this year to increase IDA transparency, only two have passed both houses: a bill requiring IDAs to stream their meetings over the internet and another to suspend IDA board members and staff who fail to submit required state reports.

Long Island’s IDAs awarded breaks to 809 projects on their property, sales and mortgage recording taxes during the period reviewed  by DiNapoli. The tax incentives are often spread over many years, so the time period in which jobs are created varies by project.

He calculated the "net jobs gained" at each project by comparing employment figures for 2017 with those for the year before the project got IDA help.

Locally, the largest number of new jobs — 15,836 — were created by 132 projects receiving aid from the Suffolk County IDA. The projects as a group got $12 million in tax breaks in 2017, according to the comptroller.

The Suffolk IDA ranked No. 2 behind the New York City IDA in terms of net jobs gained. The Nassau County IDA was No. 3 with 11,828 jobs at 170 projects.

Suffolk IDA board chair Theresa Ward said the report shows “our innovation economy continues to get stronger as companies locally, regionally and globally realize the benefits of doing business and investing here, and the quality of life this region provides to their employees.” She also serves as economic development commissioner in the administration of Suffolk County Executive Steve Bellone.

The Nassau projects, as a group, got about $49 million in tax breaks in 2017. That's the second-highest amount after the New York City IDA, which awarded $99 million in tax incentives to 393 building projects for 2017.

Officials on Thursday attributed the fourfold difference in tax breaks between the Nassau and Suffolk IDAs to an electrical cable project, which accounted for about 30 percent of the breaks Nassau awarded.

Among Long Island's eight IDAs, Suffolk projects had the lowest tax incentives per job, $758, while Glen Cove had the highest, $23,858. 

Anne LaMorte, chief financial officer of the Glen Cove IDA, said Thursday its high tax-breaks-per-job figure is due to the types of projects getting help: housing developments, which are needed by the city but create fewer permanent jobs than factories, professional services and other types of businesses.

CORRECTION: IDA projects created 46,860 jobs as of 2017. The figure was incorrect in an earlier version of this article because of  erroneous information in the comptroller's report.

By James T. Madore

james.madore@newsday.comJamesTMadore

James T. Madore writes about Long Island business news including the economy, development, and the relationship between government and business. He previously served as Albany bureau chief.