The answer is extremely simple:
Without tax abatement, most employers can make a lot more money moving elsewhere.
States like NC are, literally, giving manufacturers free buildings. And, here, we complain when they get a tax break.
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THey have to stop.
By allowing IDA's to continue you are just enabling what is wrong with NYS.
HIGH TAXATION and uncontrolled spending.
You are also allowing for the politically connected/supporters to operate their businesses at an advantage. YES anyone can apply but that is not an answer. IT's a an excuse to justify IDA's.
States like NC, Texas etc don't straddle an onerous yoke over the head of free enterprise.
We fight for scraps and each other while other areas attract business.
The answer as to why it is so out of whack starts with Rockefeller in my opinion. We have cultivated a government monster suckling folks on each side of the nipple...
IDA's are a waste unless it is regional... then again that would go against the fragmentation so necessary for government to exist here.
IDA's are necessary to compete against other states because like therising said, they are all trying to lure them so we have to play the game somehow. Even if NYS was more competetive overall regarding taxes, we'd still need some sort of IDA.
I'm totally against the way we have an IDA for every freakin town around here though. We should have only 1 IDA for the entire Buffalo Metro. Local towns and cities should not be competing against each other when it's all the same workforce.
Here's some background I found:
Tennessee offered about 500 Million Dollars worth of incentives to lure Volkswagen to Chattenooga. A record high for incentives! That beat out the previous high of $420 million given by Georgia to Kia Motors.
http://www.timesfreepress.com/news/2...largest-state/
But unfortunately, they'll be losing Saturn.
IMO- All of the IDAs prolong the attitude of helplessness in WNY. Building new buildings and leaving the old vacant costs the tax payers more money but developers still make a profit. It's a lot like the banking industry, which took care of itself at the expense of those who owed them money. WNY won't change until the community stops waiting for someone else to create prosperity. That means stopping the give aways.
IDA's should only be used to lure businesses into our area from out of state. but then again no. Why? I don't need my competitor coming into the area being able to run their business with an unfair tax advantage I don't get. Know what mean? I could see for a large scale manufacturing plant because your really not competing with someone at that level like a chain restaurant would against a local restaurant.
You want a level playing field and that's totally understandable. And ideally, no govt from any state should offer any incentives. But that is not the reality. With other states offering massive incentives to lure thousands of jobs, new york HAS to play the game as well. We're already at a disadvantage with our taxes, but even if our taxes were average we would still be competing against these incentives.
My points are better than the "state" needs to do this to compete. The "state" doesn't give me anything and doesn't give any non government worker/non government business much of anything either.
The "State" just wants to keep their friends/family/political groups going at our expense.
It depends on the big picture and what is offered.
Let's say you have a computer shop and you employ 30 people...
Now let's say some mega-chain computer company is looking to setup shop somewhere in the northeast and is considering buffalo. Is it fair to give them a tax break that you don't receive? Of course not. But let's say this big company would employ 1,000 people. Is it fair to you if we give them a tax break? Still, no. But would it help our economy?
Hell yes.
But past history shows this doesn't happen often. It happens so far and few between that they don't even have claw backs they enforce. So right now it's just a program to get a lower cost of doing business for the politically connected and developers who profit off of it.
IT doesn't help "our" economy. IT's enabling government spending to continue. It's not correcting the main issue that is hurting our economy... over spending by the people who worked to get elected to get their hands into the tax payers revenue stream. Get in and cash out.
You're probably right about that. So instead of getting rid of the IDA's (and still not getting any new businesses), maybe we should fix how the IDA's function?
with your assessment. I also do agree with WNY res that with the original intent on IDA's it was to lure businesses from out of state. Add it up you are right, if we continue to give too much, where will it stop.
Therising is out of touch with reality, if IDA's worked here in WNY, why are we the 4th poorest in the country?
My grip is tax abatement for doctors offices, senior housing, small airports, local projects. Also it is wrong to give tax abatements to lure businesses from Hamburg to Tonawanda..
All these projects would happen no matter what.
Yes.. I believe we can give those incentives to attract them from out of state or out of the country..
I haven't really thought this through yet, but I'm ok with some sort of help for companies already established here IF they will add substantial jobs (or in some instances, job retention), but not to the extent they now seem to get and certainly not to move from one local town to the other. Looking at the ECIDA site, it looks like all projects get pretty much the same mortage filing fee, sales and property tax abatements. That needs reforming. More low cost loans, ok, SOME property or sales tax help, ok, but not total abatement like they seem to get under the current setup. Out of towners should definitely get higher bennies to help draw them in and offset the higher cost of doing business in NYS (yes, that should change but chances of that changing is about slim to none IMO)
Various out of towners not all. No local business needs an out of towner opening up here with an unfair tax advantage to skim their business away.
When you give incentives to a large manufacturing company to move in they are really not competing locally with established businesses.
Example... bass pro will compete with local fishing bait/tackle shops..it's retail... delphi on the other hand really doesn't complete with too many people here at all... thier parts are shipped all over the place.
YOu know exactly what I have been stating over the years here...
No one should get a tax break at all... either we all get it or no one does...
I always said if you can pull a real manufacturing company from out of state I could see that. TO pull a bass pro to create part time retail jobs while competing against local guys is stupid.
So you want only certain businesses that don't compete with anyone to move in? That severely limits the choices don't you think? The problem is businesses are not beating down our doors to set up shop here. If not incentives (tax breaks) how else to bring business here? Or keep business expansions here rather than opening up another facility in another state?
I gave this example earlier..... what if the new company offers more jobs?
Local company "A" has 10 employees, but New Company "B" will hire 200 employees. I don't see why we shouldn't consider some tax break for a company willing to hire more employees. It's not fair to company A, but then they're not really helping the economy as much either.
I agree but problem with current system is lack of accountability. Too many cases where a company may promise (on application) to hire a certain number of employees but never does. Not to beat a dead horse but look at Lancaster Airport. I have a copy of application whereas they state "0" for question regarding how many employees they plan on hiring. Now why would Lancaster offer IDA's (yes more than one) to Lancaster Airport when they do not plan on hiring? Perfect example of rubber stamping an application without doing some homework. In addition, most pilots housed out of Lancaster Airport are NOT from Lancaster but enjoy cheap hanger rental due to IDA's!!! Bottom line... if we must have IDA's in Erie County, system needs serious overhaul.
yes iching, you are right. And there needs to be much better "due diligence" beforehand to be able to decide if the project can yield the number of jobs claimed on the application. I can't speak to the good or bad of the airport deal, but I can see where there may be times to help a company that will not expand jobs, for instance if a company needs to replace major capital equipment or close shop. Better to help them upgrade than to lose jobs and preferably with low cost loans than abatements. Again though, there needs to be some due diligence to decide if the investment is worth the jobs that are being saved. Otherwise why not just give those employees $80,000 each and call it a day! (No, I don't really mean anyone should do that)
Res, I know you see it as unfair competition, but if you want to expand or create more jobs, you should have the same chance at some sort of help as any other IDA recipient. If you don't want or need the help, that would be your call, but if others do, it's not really unfair competition then, as you would have had the same opportunity (as per 300's example)
and IDA must produce something by giving it back to the community inwhich the IDA came from. Example, the airport, employes 2 full time ~2 part time, not of which live in Lancaster. The airplanes are from other towns, the hangar rates and the fuel is so low it lures business away from surrounding airports. Does the IDA benefit the town? No, our taxes are skyrocking because of subsidizing businesses that should not need to be subsidized already by the FAA monies that came out of our pockets. I mean come on, the airport gets 13 million dollars, do you t hink they need three IDA's too?
Point in case, I do believe smaller businesses should qualify for IDA's just like the bigger business. But I don't think that dentists and law firms should get them, they would move in that area anyways.
I still think you're alright in my books.