Skoufis Launches Orange County IDA Probe, Calls for Legislative Action to Reign in IDA Malfeasance

Senator James Skoufis (D-Orange County), as chair of the Senate’s Investigations & Government Operations Committee, announced Wednesday that he has launched a new Senate probe into recently approved property tax breaks by the Orange County IDA. The 15-year corporate subsidy for a forthcoming expansion of Mack Bros/Milmar Foods in Goshen will cost the local community more than $2.25 million over the life of the giveaway.

While not at all surprising given the IDA’s well-documented record of granting overly wasteful corporate handouts, this decision was particularly confounding: the applicant stated clearly in its application that, yes, the project would indeed move forward if the IDA didn’t grant the requested incentives. This question, sometimes referred to as the ‘but for’ principle, should serve as an unequivocal filter for any application. If a need for incentives doesn’t exist, why grant them at all?

“Let me be clear: some development projects are worth incentivizing, and not all deals are bad deals,” said Skoufis. “But in a scenario such as this, when the applicant has very clearly and publicly raised their hand to say, ‘actually, we don’t need your help,’ why on earth would we turn our backs on millions in tax revenue? I’ve said it before and I’ll say it again–the Orange County IDA has got to be one of the worst negotiators on the planet.”

Skoufis’ office will soon issue information and document requests to the IDA about this agreement, in particular, and will be surveying the applications of other county-level IDAs across the state to gauge their treatment of such responses. Flanked by advocates for smarter economic development from the Strong Economy For All Coalition, New Yorkers for Fiscal Fairness, and Reinvent Albany, Skoufis also called for commonsense legislative and budgetary reforms. As the Senator begins state budget negotiations, he’s pushing to mandate that all IDAs within Orange County submit their proposed tax breaks for a given project to each impacted taxing jurisdiction, and that IDAs cannot proceed with awarding tax breaks unless the governing bodies of these jurisdictions approve them. Such safeguards to protect taxing jurisdictions and their taxpayers are already being successfully–and voluntarily–applied by the neighboring Rockland County IDA.

"For far too long we have been engaged in an economic development 'race to the bottom' where the winners are wealthy corporations and the losers are workers, property tax payers, and our school children,” said Ron Deutsch, Director of New Yorkers for Fiscal Fairness. “IDAs are giving away school revenue like candy across New York State, apparently whether these businesses need them or not. We should freeze all of these corporate giveaways this year and reform this broken system before we spend another dime. I am proud to stand with Senator Skoufis who has been a constant voice of reason when it comes to reforming these programs to protect taxpayers.”

"We recommend a hard freeze on all corporate subsidy giveaways in New York, both by local IDAs and by the state government," said Michael Kink, Executive Director of the Strong Economy For All Coalition, "and we commend Senator Skoufis for his leadership and his hard work in this area. IDA giveaways defund local schools and raise taxes for everyone else -- it's the worst of both worlds. Public funds should pay for public goods: great public schools, solid infrastructure, clean affordable energy, and housing are the things that really build prosperity and strong communities. We'll work with Senator Skoufis to freeze the giveaways in this year's state budget and pass real reforms that will benefit all of us."

"Reinvent Albany thanks Senator Skoufis for energetically spotlighting the massive wastefulness and dysfunction larded in the $10 billion a year in business subsidies doled out by New York State and local governments,” said Elizabeth Marcello, Senior Research Analyst, Reinvent Albany. “New York State needs to freeze corporate handouts, say no to the billions in new giveaways proposed by Governor Hochul, and corral the IDAs destroying local tax bases and jacking up property taxes."

Skoufis also sponsors a handful of legislative solutions to sideline bad-acting IDAs across New York State: