New York’s broken corporate subsidy system comes at a huge cost to local communities: state and local economic development programs give out over $7 billion to corporations in the name of job creation every year.
New Yorkers should get their money’s worth from job creation dollars. We must transform the way public investment is done in New York so that subsidies create good jobs, not giveaways. We must change the economic development process from one of backroom deals, big announcements, and poor reporting to one that prioritizes performance, and is transparent and accountable to the people. Keeping in mind best practices and proven solutions from around the country, we recommend economic development happens in these stages:
- Prioritize Performance. Economic development programs should prioritize a set of performance metrics that can be used to evaluate and monitor the success of spending in relation to key goals, including local job creation and carbon emissions benchmarks.
- Set Goals. More streamlined and consistent subsidy applications and financial assistance agreements, with clear benchmarks for job creation, local hiring and environmental sustainability.
- Protect Local Jobs. Strengthen anti-piracy provisions to prevent companies from gaming the system by shifting jobs within the state instead of creating new jobs. Require local hiring and apprenticeship programs in return for large subsidies.
- Increase Accountability. New Yorkers need increased accountability to ensure that subsidy recipients deliver on their promises and actually create jobs and community benefits.
- Involve Community Stakeholders. Improved public notice and comment periods, more diverse labor and community representation on economic development decision-making bodies, and approval by local taxing jurisdictions.
- Money-back guarantee. All subsidy deals must have provisions to recapture public money when companies fail to live up to agreed-upon performance goals.
- Show Us the Jobs. Communities must be able to easily monitor and assess the performance of their investments.
- Online Reporting. Website with detailed annual reporting on companies that receive subsidies, including how well they are measuring up to their agreements and how they are benefiting communities in terms of job quality and greenhouse gas emissions.
- Show Subsidy Spending in the Budget. A yearly accounting of economic development spending by program that will shed light on our economic development system and inform decision-makers during the budget process.
To learn more about Getting Our Money’s Worth and how you can help, contact us.