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Suffolk County IDA, Long Island

In 2005, OSI bought a 60,000-square-foot building in Melville for $11.5 million, and also added $8.5 million in renovations. The site became the OSI headquarters. OSI received $600,000 in Empire State Development Corp. capital grants in addition to $1.6 million in sales tax exemptions from the Suffolk County IDA to complete the project. To get the state grant, OSI committed to adding 250 local jobs to their 160 in the following three years but only reached 200.

In 2009, OSI toyed with expanding its operations on Long Island and tried to get sweatheart leasing deals from their facilities located on state property. Ultimately, the company was lured away from Long Island by $3 million in sales tax breaks from New York State and Westchester County governments to help pay for a $100 million consolidation and expansion of its headquarters in Greenburg. The state is continuing to pay OSI’s $1.8 million/year rent in Long Island, and the departure of OSI Pharmaceuticals has left the Suffolk County Industrial Development Agency trying to claw back the $1.6 million in sales tax exemption that OSI got to do work done on its building in Melville.

Instead of IDA subsidies being leveraged to create new jobs in the state, OSI shows how jobs are often just shifted to other parts of the state, and taxpayers are left paying the price.