BILL NUMBER: S4868REVISED 3/31/23

SPONSOR: RYAN
 
TITLE OF BILL:

An act to amend the general municipal law, in relation to financial
assistance from an industrial development agency; and to repeal certain
provisions of such law relating thereto

 
PURPOSE OR GENERAL IDEA OF BILL:

This bill would prevent retail establishments from utilizing the "highly
distressed area" exemption to the retail ban for industrial development
agencies.

 
SUMMARY OF SPECIFIC PROVISIONS:

Section 1 repeals subdivision 18 of section 854 of the general municipal
law.

Section 2 removes references to "high distressed areas" from paragraph
(b) of subdivision 2 of section 862 of the general municipal law.
              

Section 3 is the effective date.

 
JUSTIFICATION:

Industrial development agencies, or IDAs, are public benefit corpo-
rations created under the general municipal law and the public authori-
ties law. Since their creation in 1969, they have offered billions of
dollars of incentives large multi-national corporations.  The only data
the state receives regarding job creation and economic benefits as a
result of IDA activity is self-reported by the corporations, and their
exact effectiveness in this area is unknown.

In the 2013-2014 budget, language was added to the general municipal law
to prohibit IDAs from providing incentives to projects where the facili-
ties or property would be primarily used for retail sales of goods or
services. Exceptions to this retail ban were carved out as well. Per the
budget briefing book, the goal of these changes was to "make IDAs more
accountable by limiting the industries to which IDAs can offer State
sales and other use benefits to...key sectors."

Despite this ban, many IDAs continue to offer incentives to retail and
food service establishments. According to the U.S. Bureau of Labor
Statistics, the median wage for a food service worker nationwide in 2021
was $28,780 per year. The reason for the "highly distressed area"
exemption to the retail ban is ostensibly to improve the conditions in
the area by creating more jobs that will lift residents out of poverty.
$28,780 per year is not enough to lift an individual out of poverty,
never mind a family. Providing incentives to retail and food service
entities does not benefit highly distressed communities. We need prior-
itize high-wage jobs that have a proven record of lifting people out of
poverty.

 
LEGISLATIVE HISTORY:

New bill.

 
FISCAL IMPLICATIONS:

None.

 
EFFECTIVE DATE:
This act shall take effect immediately and shall be deemed to have been
in full force and effect on and after February 28, 2023.