(WNY) NYS recently shined a spotlight [pdf] on the state-sponsored industrial development agencies (IDAs), seeking to deliver a minimum of oversight and transparency as the IDAs dole out tax exemptions and other public goodies to business. There is previous WNY-WJ content about this here, and the table from that content is now updated (see table at bottom left) to show more data and analysis.
Depending on how a project sponsored by an IDA is structured, there may be both tax exemptions granted to a business and a requirement for the business to make payments in lieu of tax (PILOT), where PILOT serve in the project agreement to partially offset government revenues given away through tax exemption. PILOT are monitored by the IDA as part of its responsibility for each ongoing project.
PILOT are expected to be uniformly treated by an IDA, and projects negotiated by an IDA are not meant to promote “piracy” – where an IDA uses financial assistance to lure companies already located within NYS. High ratios of net exemptions – where net exemptions are tax exemptions granted minus PILOT received, to tax exemptions demonstrate that PILOT are low relative to tax give-aways, and could raise eyebrows. The chart at top left shows the ratio of net exemptions to tax exemptions. So, how does your local IDA compare?
The updated table (at bottom left) shows tax exemptions and net exemptions measured on both an absolute and per-capita basis for the combined years 2008-11. The table in previous WNY-WJ content showed only the tax exemptions. The ratio (presented as a percent) of net exemptions to tax exemptions is provided as well, where a higher percentage indicates less PILOT relative to the tax exemptions.