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November 11, 2011

Using the Northtown Lexus Dealership on Sheridan Drive in the Buffalo Suburb of Amherst as a backdrop to underscore the misuse of public dollars given out by Industrial Development Agencies (IDAs) that fail to create good jobs or promote broad community benefits, Organized Labor, Community Activists and members of Occupy Buffalo called for a number of reforms to ensure IDAs do not waste taxpayer dollars.

The rally in Amherst was one of several coordinated actions that occurred across New York State on Thursday (November 10th) that called for economic development reform. The action also included a teach-in with Occupy Buffalo activists on the impact of economic development subsidies, which took place earlier in the afternoon at Niagara Square in Downtown Buffalo.

The Getting Our Money’s Worth Coalition is a broad group of Public Policy Experts, Government Watchdogs, Labor Unions, Community and Religious Organizations, as well as concerned small business owners, Workers and taxpayers. The statewide coalition is anchored by ALIGN: The Alliance for a Greater New York and the Buffalo-based Coalition for Economic Justice (CEJ).

The event was the second such held in Western New York in recent weeks. In mid October, the Niagara-Orleans AFL-CIO Central Labor Council held a news conference in Niagara Falls to unveil a new 75-page IDA Report entitled, Generating Waste:Problems With NYPA And The IDAs And How To Solve Them, which called attention to IDAs that use taxpayer dollars to fund construction of auto dealerships, hotels and supermarkets that work to create low-paying jobs and fail to adhere to safety standards that have caused on-the-job deaths and injuries. At that press conference, Niagara-Orleans Labor Council President James Briggs said elected representatives must also be held accountable in order to bring about needed change.

In Amherst, Northtown Automotive Companies was singled out for receiving a subsidy of $536,000 from the Amherst IDA to move its Lexus dealership from 3930 Sheridan Drive from across the street to 3845 Sheridan Drive. Despite guidelines for IDAs in Erie County making auto dealerships ineligible for tax breaks, the Amherst IDA granted $245,000 in sales tax breaks, $213,968 in property tax breaks and $77,000 in mortgage recording tax breaks.

“We could be using our economic development subsidies to create quality jobs and other opportunities so our region can thrive,” Western New York AFL-CIO Area Labor Federation (WNYALF) Field Coordinator Patty DeVinney said at the news conference.

“Western New York’s 14 IDAs have ‘given away’ $48.5 million in net tax exemptions in 2009 alone, said DeVinney, who added: “With that money we could fund the education of over twenty-six-hundred students for one year or retrofit over thirty-seven-hundred small businesses for energy efficiency, save millions of dollars in energy costs and employ nearly eight-hundred Workers in the construction industry.”

Meanwhile, CEJ Executive Director Allison Duwe cited a new report, Regional Review: Job Creation and New York’s Industrial Development Agencies, which highlights consistent problems with economic development activities across New York State.

“The Amherst IDA, along with IDAs in Western New York and across the State, consistently hand-out tax breaks to companies that don’t promote real economic growth. All Erie County residents are impacted by this deal because the IDA gave this Lexus Dealership a break on its county property taxes. We need performance standards, accountability measures and transparency reforms to ensure that IDAs do not waste taxpayer dollars. We’re not opposed to subsidies if they support companies that are helping to build a better future, but this deal is ludicrous,” Duwe said.

Lynn Diagostino, a Buffalo-area school Teacher, also spoke at the news conference and said: “Reckless spending by IDAs on projects like this Lexus Dealership has a tremendous impact on our communities in Western New York and throughout the State that lose out on tax revenues and struggle with job cuts and public service cuts. What’s more important, educating our children and retaining good jobs in education or supporting a luxury car dealership?”