State Economic Development Changes? Not From Albany

ALBANY, N.Y. (AP) — It appears no one outside Gov. Andrew Cuomo's administration is pleased with the Democrat's economic development policies, except for the recipients of some of the billions of dollars in taxpayer funds awarded each year to boost employment.

The criticism comes from the left and the right, from conservative think tanks and liberal fiscal watchdogs, and from Republican and Democratic lawmakers in Albany.

"It's questionable if we're getting a good return on our investment," said Ron Deutsch, director of the Fiscal Policy Institute.

New York's 2018 legislative session ended June 21, with the Legislature failing to pass two bills viewed as key for changes to various economic development programs. One would have restored oversight of certain state procurement contracts to the comptroller's office. The other would have created a searchable database of deals for publicly tracking online where economic development dollars are going and whether the recipients are creating the number of jobs promised.

The Republican-led Senate passed both bills, but the Democrat-controlled Assembly didn't bring them to the floor for a vote, despite having the backing of many Democratic members.

"We want to get to a three-way agreement on the issue," Michael Whyland, a spokesman for Assembly Speaker Carl Heastie, said about Cuomo not being on board yet with Assembly legislation.

Critics of Cuomo's economic development programs point to two high-profile trials as evidence that his policies are in dire need of reforms. One involved a former top aide, Joseph Percoco, who was convicted this year of bribery and fraud. The other, currently underway in federal court in Manhattan, has Cuomo's former economic development guru, Alain Kaloyeros, charged in a bid-rigging scheme.

The charges against both men stemmed from dealings they had with major economic development projects in upstate New York, where the economies in many areas continue to lag the rest of the state, despite hundreds of millions in state funds Cuomo has steered their way.

Cuomo was not accused of wrongdoing at either trial.

His administration has said that during Cuomo's two terms in office, his programs have boosted regional economies across the state, attracting billions of dollars in investment and creating thousands of jobs.

But government watchdog groups and many Albany lawmakers say New York taxpayers are getting shortchanged on the billions in tax breaks, incentives and other corporate subsidies the state doles out annually. And, they add, there's not enough transparency for how up to $4 billion in taxpayer money is allocated each year.

"It's almost impossible to prove any of this is cost-effective," said E.J. McMahon, founder of the conservative Empire Center for Public Policy.

The year got off to a shaky start for Empire State Development, the state's main economic development agency, when it was 36 days late in releasing its first comprehensive annual report, a document required by the Legislature. Critics on the left and right panned the report, with John Kaehny, of Reinvent Albany, a good-government group, calling it "totally vague and useless."

The 127-page report is filled with charts, tables and graphs, but Kaehny and other critics say it offers no clear way to compare the state funds invested to the number of jobs supposedly created by individual companies.

"The definition of a job is different for every (economic development) program," he said. "There's no apples-to-apples way to compare" job creation claims in the report.

The report also featured a photo of several cranes at a construction site turned out to have been taken in South Africa during the construction of a soccer stadium for the 2010 World Cup. The gaffe left Albany observers already critical of Cuomo's economic development policies shaking their heads.

"When they try to hype things so relentlessly," McMahon said, "it undercuts their credibility."