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Cuts eyed for incentives

Projects to be evaluated on case-by-case basis

John Golden

Apr-22-07, 07:00 PM

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Topics: Economic Development, Government

Gov. Eliot Spitzer’s downstate economic development chief has said the state will curb its financial incentive packages for project developers throughout the state as part of the administration’s goal to ease the cost burden on taxpayers.

The state’s tougher negotiating stance with developers should not affect projects in Westchester, a county economic development official said last week.

Patrick Foye, downstate chairman of the Empire State Development Corp. (ESDC), told the New York Sun this month that the state plans to lower the amount of subsidies and tax breaks commonly offered project developers. Those incentives often include tax-free bonds for construction and payment-in-lieu-of-tax agreements for startup businesses.

While keeping a tighter grip on the state’s economic development dollars, Foye reportedly said state officials will be “passionate advocates for the advantages of doing business in the city and state.”

The planned cuts in development incentives will not be across the board for proposed projects, said an Empire State Development Corp. (ESDC) spokeswoman.

“We are going to evaluate each deal on a case-by-case basis to make sure that taxpayers are getting the most for their dollars,” Anna Maria Mannino said. “It’s not a specific formula; it’s more of a strategic goal. We want to lower the bar to make it more fair for taxpayers.”

That goal is in line with Spitzer’s campaign pledge last year to reform the state’s economic development strategy, which he called “fragmented, politically driven and unaccountable.” In particular, he criticized the agenda of the ESDC under Gov. George Pataki as “too often driven by political considerations rather than economic merit.”

“Decisions must be based on merit, not on politics, with the public interest, not the special interests, in mind,” he said.

Theresa Waivada, deputy director of the Westchester County Office of Economic Development, said she expects to see no change in the county’s working partnership with ESDC under the Spitzer administration.

“We have been fortunate to have state support on some major projects, but it’s never been comparable to the grants that have been given to New York City and on Wall Street,” she said.

In the wake of the Sept. 11 terrorist attacks, Goldman Sachs, the Wall Street investment banking firm, reportedly received $115 million from the city and state and $1.6 billion in tax-free federal bonds to build its headquarters in lower Manhattan. Its banking rival, JPMorgan Chase & Co., reportedly is seeking a large incentive package from city and state officials to build a 50-story office tower near Ground Zero.

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