New York state has a long history of squandering huge amounts of taxpayer money on economic development projects that yield little to no returns.
A new report highlighting the state’s “Dirtiest Dozen” economic development deals ranked four Western New York projects at the top of the list.
The report, developed by the American Economics Liberties Project, a nonprofit organization that advocates for corporate accountability, singled out the subsidy package offered to Plug Power to locate a facility in Genesee County – at a public cost of $4 million per job – as the worst of the worst.
“The most expensive economic development deal in New York history on a per-job basis, the clean energy corporation Plug Power received nearly $270 million to create just 68 jobs at a plant at the Science and Technology Advanced Manufacturing Park site in Genesee County – and that amount doesn’t factor in the costs of local infrastructure to service the plant,” the report notes.
No. 2 on the list references the 1,250-acre industrial site in the Town of Alabama where Plug Power is building a $290-million hydrogen production facility. Formally known as the Science and Technology Advanced Manufacturing Park, or STAMP for short, soft costs for the site’s development total $26 million and counting. The bulk of the funds come from former Gov. Andrew Cuomo’s Buffalo Billion program.
The “Dirtiest Dozen” report describes the site as part of a “much larger failed push to attract a semiconductor manufacturer to New York. The effort includes $3.2 million in public funds spent on an Onondanga County commerce park which has had no tenants for 20 years.
“State officials have proposed massive subsidy packages for semiconductor corporations to come to one of those two largely empty sites, including $1.9 billion for a Samsung plant that ultimately went to Austin, Texas,” the report notes.
Rounding out the four worst projects: the state’s $950 million investment in the Tesla plant in South Buffalo and the Buffalo Billion program in general.
Under a tag line that reads “Billions for a billionaire don’t pay for New Yorkers,” the report notes that the much-ballyhooed Tesla solar panel manufacturing plant employs far fewer than the 3,000-plus workers Cuomo predicted when he announced the deal in 2015. The report notes that the state has sold off more than $200 million in manufacturing equipment that it bought for the Tesla and Panasonic manufacturing facilities.
“A state audit found the state’s investment has produced only 54 cents on the dollar for the public,” the report notes.
As for the rest of the Buffalo Billion, the report points out that tech jobs declined in the region despite the program, which was marred by a bid-rigging scandal that resulted in multiple convictions on public corruption charges.
Quoting U.S. Attorney Preet Bharara, whose office prosecuted the case, the report notes: “The bids were rigged and the results were preordained. Companies got rich and the public got bamboozled.”
The remainder of the list highlights a $15 million film studio “flop” outside Syracuse, public incentives provided to the online retail giant Amazon, lucrative subsidies for the horse racing industry and tax breaks for the developers of Penn Station in Manhattan.
“New York State is one of the most prolific users of so-called ‘economic development’ incentives in the country, spending some $10 billion annually at the state and local level on subsidies to select businesses,” the report notes. “For all that, New York has very little to show other than empty factories, underwhelming job-creation numbers, and a slew of corruption scandals.”