IDA Report Shows Tax Break Growth Slows Job Creation Remains Higher Downstate
Real Estate In-Depth | June 5, 2018
ALBANY—New York State’s Industrial Development Agencies reported $715 million in net tax exemptions in 2016, up almost 3% from 2015, according to a report issued on June 1st by New York State Comptroller Thomas P. DiNapoli.
The report also showed that downstate regions accounted for 57% of the total net jobs gained through IDA projects in 2016, with Long Island achieving nearly 25% of the statewide total. IDAs in upstate regions accounted for 43% of the total net jobs gained.
“IDA projects continue to produce new jobs across the state, but the pace has slowed in several upstate areas,” said DiNapoli. “Across New York there are nearly 4,500 IDA projects valued at $96 billion currently underway. In today’s economy, it is important communities benefit when offering tax breaks. Our report can help determine if the incentives supporting local economic development efforts are worth it.”
DiNapoli’s annual report found the state’s 109 active IDAs provided approximately $1.3 billion in total tax exemptions in 2016. These exemptions were partially offset by $606 million in payments in lieu of taxes. Both total exemptions and PILOTs increased, resulting in net exemptions of $715 million—$20 million (2.9%) over the prior year. In 2015, net tax exemptions were up $63.2 million, or 10%, from 2014 levels.
Two-thirds, or 2,967, of all the projects resulted in net jobs gains in 2016. All IDA projects together produced a net total of 208,707 jobs. Service industry positions accounted for 47,732, or 23%, of the total net jobs gained, closely followed by manufacturing (21%), and finance, insurance and real estate (18%). Temporary construction jobs totaled 40,516 in 2016. In 2015, cumulative job gains for projects active in that year equaled 224,734.
Outside of New York City, the Comptroller’s report also found that in 2016:
Six of the seven upstate regions reported net job gains, with the Capital District adding the most (23,900). Long Island led the downstate regions with 51,632 jobs;
The Finger Lakes, Western New York, Southern Tier and Mohawk Valley regions experienced job gains, but the growth was smaller in 2016 than in 2015. The North Country region suffered a decline in job creation for the fourth straight year;
The Long Island (812), Finger Lakes (750) and Western New York (736) regions had the largest number of projects;
The Mid-Hudson ($134 million) and Long Island ($125 million) regions had the highest net tax exemptions;
The Mohawk Valley ($17 million) and North Country ($5 million) had the lowest net tax exemptions; and
The Capital District ($81) and Mid-Hudson ($58) regions had the highest net tax exemptions per capita.