Total existing-home sales—completed transactions that include single-family homes, townhomes, condominiums and co-ops—rose 3.1% from December to a seasonally adjusted annual rate of 4.00 million in January.
Report: New York State IDAs Generated $141 Billion in Wages; Created, Retained 1.3-Million Jobs in 2021
ALBANY—In light of some criticism being leveled against Industrial Development Agencies in New York State, particularly the need and financial returns of incentives granted to development projects by IDAs, a newly released report commissioned by The New York State Economic Development Council calculates the benefits of IDA incentives in 2021 in the billions of dollars and more than 1 million jobs retained or created.
Recently, New York State Senator James Skoufis, the Chairman of the New York State Senate Investigations and Government Operations Committee, has criticized Industrial Development Agencies particularly the Orange County Industrial Development Agency over some of the incentives it has awarded to development projects, charging that those incentives were not necessary. He also had a law passed that will have the Orange County IDA’s operations overseen by a state-appointed monitor.
On Oct. 30, The New York Economic Development Council released its report by Camoin Associates that found in 2021, IDAs helped create and retain 1.3 million jobs representing $141 billion in annual wages. Those wages helped generate $12.4 billion in annual New York State tax revenue.
The report calculated that for every dollar of taxes abated via IDA incentives, IDA projects generated $6.57 in new tax revenue for New York State. In addition, for every one dollar of exemptions issued, $74.89 in employee earnings was generated in the state and $237.46 in sales was generated in the state.
Also in 2021, IDA projects created $830 million in new tax revenue for local taxing jurisdictions including $338.9 million in payments to school districts across the state. This is new revenue to the schools that otherwise would not have occurred without IDA involvement. The total amount of school taxes abated by IDAs represents less than .5% of total school spending in 2021, the report stated.
The report calculated that active IDA-approved projects in the Mid-Hudson region in 2021 generated 80,308 direct jobs, 33,287 indirect jobs and another 49,793 induced jobs, bringing the 2021 jobs grand total to 163,388. The total earnings combining direct, indirect and induced earnings totaled $15.34 billion and IDA-induced projects in the region generated sales of approximately $55.63 billion.
The study reviewed the impacts of IDA projects specifically for the year 2021 as well as their broader economic impacts from 2018-2022. Data for this report was collected from the 2021 public authorities reporting information system (PARIS) overseen by the Office of State Comptroller, Lightcast, a global leader in labor market analytics, and survey data collected from 80 IDAS on housing and renewable energy.
“The sheer scale of the cumulative impact of IDAs on New York State’s economy is impressive,” said Rachel Selsky, Vice President at Camoin Associates. “The findings in the report demonstrate the positive outcome of the hard work done by these critical economic development organizations across the state in terms of jobs created, earnings generated, housing units developed, downtowns revitalized, renewable energy produced, and tax revenue generated.”
In terms of residential development projects, a total of 425 projects with a residential component have been approved statewide since 2018. The report stated that IDA projects were responsible for the construction of 39,625 new housing units—more than 10,000 of which were classified as affordable units.
Green projects also have secured benefits from IDA incentives. The report noted that since 2018, there have been 332 approved IDA projects statewide that include wind and solar infrastructure. These projects generate 4,809 megawatts of clean, renewable energy.
The study was conducted over the past 10 months and provided a host of policy recommendations for the upcoming 2024 state budget and legislative session, including: formally authorizing IDAs to support the state’s housing goals, formally authorizing IDAs to support housing in accordance with the states housing goals; authorize IDAs to utilize their funds generated from fees to issue loans and grants to small businesses, and updating the Public Authorities Reporting Information System (PARIS) to ensure that the public has access to information about how these investments are performing.
The New York State Economic Development Council also calls for the reauthorization of $200 million in funding for the Fast New York Program to fund shovel-ready sites; reauthorization of $100 million for the RESTORE New York Program; reauthorization of $200 million for the DRI and the NY Forward Programs; the allocation $50 million for the prison redevelopment fund and the creation of a Master Plan Matching Grant Fund Program for municipalities (towns, cities, and counties) who want to update their master plan or the zoning plan. For any municipality that commits to increasing its housing stock by 5% over the next five years, the state would provide up to 50% of the matching funds needed to develop the master plan that will increase the community’s housing stock. Using this method, the state and locality are partners in the process, and the public will have the opportunity to partner with the state and their local elected leaders to determine where and how additional housing will be brought to their community.
A host of economic development and government officials across the state, including the Hudson Valley, praised the report’s findings and stressed the importance of IDAs in retaining and attracting business to New York.
Maureen Halahan, President and Chief Executive Officer of The Orange County Partnership, told Real Estate In-Depth, “Every state in the country is chasing jobs and new companies to land in their state. The fact that we have incentive programs in place to compete with other states is critical. These incentive programs are what we have to combat the high cost of living, the high taxes and the significant regulation that exist in New York. In fact, New York State has programs in place, such as Consolidated Funding Applications and other grant programs, to try and stay competitive. So, every one of these incentive programs are of critical importance if we are to stay competitive and keep people and workers in the State of New York.”
The Business Council of New York State President and CEO Heather Mulligan said upon the release of the report: “IDAs have long served an invaluable role in New York’s overall economic development efforts and in addressing key regional needs, and have promoted billions in private sector investments, including most recently on emerging priority issues including clean energy, affordable housing and the revitalization of our urban centers. Recent statutory amendments, developed with input from all stakeholders including IDAs and developers, are helping assure that IDA supported projects return significant economic benefits to the state and its municipalities. This study illustrates both the breadth and depth of the positive impacts achieved through IDA-supported investments.
Partnership for New York City President and CEO Kathryn Wylde said, “At a time when conventional project financing is expensive and difficult to secure, the role of IDAs is particularly important to sustain economic growth.”
The Business Council of Westchester President Marsha Gordon said, “I have seen firsthand the fact that IDAs in Westchester play a critical role in the growth of our economy. From Regeneron Pharmaceuticals to multi- residential housing across the county, IDAs remain the best local economic development tool to attract and retain private sector investment. This report not only highlights the broad economic impact of Westchester’s IDAs but highlights their important role in bringing much needed housing to our community. Without their support, these projects could not move forward.”
New Rochelle City Manager and IDA Board Chair Kathleen Gill said, “New Rochelle has undergone a tremendous transformation in the past few years as more than $2 billion in private sector investment has led to a revival of our urban core with more than 10,000 new homes authorized, and well underway. This transformation wouldn’t have been possible without the support of the city’s IDA and the tools it deploys. Thanks to our collective efforts, New Rochelle is among the fastest growing cities in New York State and has become a model community for creating new, high-quality housing that’s affordable.”