by Michael Stamm
Between now and January 31st the Tompkins County\'s Industrial Development Agency will issue just slightly more than $112 million of tax-exempt bonds to five local not-for-profit employers. We are racing against the clock because the State law that allows IDAs to issue these types of bonds is almost certainly going to expire after January.
Even those with the most cynical view of Albany wonder why our State legislator could let this happen, could allow a law to expire that authorizes a local agency to assist local not-for-profit employers. The bonds IDAs issue are not a financial obligation of the State nor are they a potential burden for local taxpayers. Simply put, IDA bonds allow not-for-profit employers to borrow money at lower interest rates for important expansion projects.
Here are the five projects our IDA hopes to assist in the next thirty days:
- Cayuga Medical Center for new equipment
- Longview for an expansion and refinancing of old debt
- Family & Children\'s Services for the acquisition of a building
- Cornell for their combined heating and power project
- TC3 Foundation for two new dormitories
So, what is going on in Albany? As is often the case, the Senate and the Assembly are divided. Most in the Senate not only want this important IDA legislation to be made permanent but also to be expanded so local IDAs can assist more projects. The Assembly, on the other hand, is apparently being influenced by the forces of big organized labor, especially from downstate. The majority of the Assembly is supporting legislation that would require all IDA projects to be built with prevailing wage labor. In addition, the permanent employees of the projects would be required to be paid the "median wage" for the specific occupation.
Now most IDAs, and certainly the Tompkins County IDA, place a premium on good jobs. That is, after all, the primary reason IDAs were created back in the early 1970s. At any of our local IDA meetings wages, benefits and room for advancement for entry-level employees are hot topics. Local incentives delivered have been tied to construction labor requirements and to a specific number of quality, permanent new jobs created.
The Tompkins County IDA carefully reviews each project. It understands that every company and every project is different, and some have the ability to pay, for example, prevailing wages to contractors, and some don\'t. A recent approval of a $19 million new construction project, in fact, requires prevailing wages to be paid to all construction labor. A similar requirement was not placed on a different project because of obvious financial constraints.
The overarching question here is clear: should IDAs be, as they have been for decades, allowed to create and implement economic development strategies that best meet the needs of their communities and businesses? Or should New York State politicians, influenced by special interest groups, be allowed to dictate the terms and conditions of incentives local agencies deliver to local employers? And even if the State\'s proposals are well intended and reasonable (hard to imagine, I know), it is inconceivable these complex requirements would be administered in a way that would achieve the desired outcome.
And finally, a bit of inescapable irony: if the State allows the legislation to expire and local IDAs cannot help local not-for-profits employers, our not-for-profits do have an alternative. They can turn to a massive State authority, the Dormitory Authority of the State of New York, commonly called DASNY. There is no movement in Albany to compel its own authority to require prevailing wages or median wages.
Since 1973, the Tompkins County Industrial Development Agency has delivered local incentives to over ninety projects. Those projects, both private sector and not-for-profit, have invested over $750 million dollars in our community and created thousands of new, quality jobs. Our community can simply not afford to allow Albany to cripple IDAs with inaction or, worse case, bad legislation.
So if you happen upon one of our elected officials that represent us in Albany, tell them to place the needs of their constituents above then needs of downstate special interest groups.
Michael Stamm
President
TCAD
Originally appeared in the Ithaca Journal's Business Journal