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EDITORIAL: LI needs unified voice for economic development

At the risk of sounding like scolds and prophets of doom - and ruining your weekend - we return again to Long Island's dismal prospects for keeping jobs here and attracting new ones from elsewhere. It's depressing, but please read on.

Our point is simple: The region's economic development structure is inadequate for competition with other states and regions. What we don't have, and what we desperately need, is one economic development voice that speaks persuasively for Nassau-Suffolk as a region.

The state lists eight industrial development agencies here: the two counties, five towns - Babylon, Brookhaven, Hempstead, Islip and Riverhead - and the City of Glen Cove. But we don't have a unifying force to promote and market the region as a whole, to act as Switzerland, focusing neutrally on the needs of the whole Island. Our eight IDAs do cooperate, but they also compete. They don't harmonize as one voice, repeating loudly: Think of Long Island as a great place to do business.

"If you can get a single one for both counties, you could be a very potent force in economic development circles," says Gerald Gordon, a New York City native who runs the Fairfax County Economic Development Authority in Virginia.

In fact, Gordon's agency is exactly the sort of powerhouse that we need. There's a lot about Fairfax County that's very different from the Island, but it's an excellent example of how to do economic development well.


From cows to corporate HQs

As Fairfax grew from a dairy center to a bedroom community for Washington, it was clear that the taxes produced by homes were not going to be enough to fund the increasing need for government services. So the county created the agency that Gordon runs. It began in the 1960s, but it didn't start to get adequate funding until the mid-1970s. The results have been impressive.

In the mid-1970s, the property tax rate was $1.74 per $100 of assessed value. Now, with four times the population, but 700,000 more jobs, the rate is down to $1.04 per $100. And Fairfax County officials appreciate that the agency has brought in jobs and lowered taxes; in a recent budget crisis, they cut other county functions, but not the authority. It continues to have a budget of $7 million, 45 employees and offices in foreign countries and San Francisco.

In other words, it's a big-league player. And, with one tiny exception, it's the only economic development player in Fairfax, unlike our situation here on Long Island.

Another sharp difference is that Fairfax has only one school district. Let's be realistic. This page has favored some small level of school-district consolidation, but even that seems out of reach. So there's no prospect of countywide districts here.


Spreading property-tax revenue

But we raise the school issue because a regional economic development agency would make no sense without a better method of sharing commercial property-tax wealth among districts. Commercial property pays a lot of taxes, but it doesn't send kids to school. Districts that don't have enough of it must rely on residential property taxes. That's a key factor in the ever-rising tax burden on homeowners.

Right now, Business A in School District B pays all its taxes to that district, and none to nearby districts. Even if we had a regional economic development agency bringing in lots of new businesses, we'd need a new structure that would let all districts in the region - or even within subdivisions of the region - share some of that vital new tax revenue going forward.

But first things first. Let's think seriously about creating a regional voice here. And let's not let our successes in job creation or retention blind us to the structural weakness that makes us vulnerable to future failures.

The failure that got us thinking about a regional voice was the departure of OSI Pharmaceuticals for Westchester. It's true that OSI left for reasons not typical of other fleeing firms, but it still hurts.

Suffolk County Executive Steve Levy complains about all the focus on OSI, rather than on the county's successful attraction of firms such as Leviton and Canon. And to be fair, Suffolk's Industrial Development Agency had by far the best cost-per-job-created number among the eight IDAs on the Island, according to a report this year by Comptroller Tom DiNapoli. But Levy and other officials need to be more open to the need for a single voice.

Yes, we have to improve the product we're selling - by cutting the taxes, the high housing and energy costs, and the red tape that scare away business. But we also have to start selling ourselves as a region.

That brings us to the IDAs. The one-agency model seems to make more sense for us here than multiple agencies. But should that one agency even be an IDA? Maybe not. In his report this year, DiNapoli showed that the jobs created had declined statewide, and the cost per job had gone up. Not good. But there's hope: One small IDA upstate dissolved.

Should we do some dissolving here? Can't we at least talk seriously about what we can do to turn our babel of small, too-often-competing economic-development voices into one powerful one? It's a conversation that we have to begin. hN