Forum Calls for Oversight of COMIDA

(September 14, 2007) — Companies that don't create the jobs that are promised in exchange for tax breaks should be made to pay for not meeting their obligations.

That was one of the calls for more accountability for the County of Monroe Industrial Development Agency expressed at Thursday evening's public forum on the agency.

The forum, held by the Democratic caucus of the County Legislature in the legislative chambers, heard concerns from 23 speakers. The meeting came on the heels of a state comptroller audit that criticized the county for funneling through COMIDA $2.5 million in state funds earmarked for airport improvements that went to a low-cost airline the county was trying to lure here.

The speakers also questioned whether the tax breaks and other COMIDA incentives were going to businesses that need the benefits.

They also said that the public and government officials affected by COMIDA tax breaks are cut out of the decision-making process while developers are given special treatment at the expense of labor.

More oversight is needed for COMIDA, said many of the speakers.

"Our local residents are doing the policing that COMIDA is not doing for itself," said Jon Greenbaum, organizer for Metro Justice, a community group that has urged COMIDA reform.

Sixty-four companies that received COMIDA benefits lost jobs, while 40 others showed no job growth or did not meet their job-creation goals, according to a recent report by the New York City affiliate of Jobs with Justice, which used 2005 data submitted by COMIDA to the state Comptroller's Office.

Eighty-six companies met their job-creation goals, the report said. In addition, localities and the state lost $24.7 million in sales, property and other tax revenue because of tax breaks given by COMIDA from 2002 through 2005, according to another Jobs with Justice report.

Greenbaum presented some of the information at Thursday night's forum.

Aron Reina, lead field organizer for the Rochester & Genesee Valley Area Labor Federation, AFL-CIO, was one of a half dozen labor representatives who spoke about the need for reforms.

"What happens if a company fails to grow the promised jobs? In these circumstances we firmly believe our public dollars need to be recouped," said Reina to the approximately 60 people who attended the forum.

COMIDA is one of 115 state-created industrial development agencies in New York. The agency provides tax incentives and other benefits to companies, often in exchange for job-creation commitments.

The seven-member board is appointed by the County Legislature. COMIDA's acting director, Judy Seil, is also acting director of the county Department of Planning and Development.

John Durso, spokesman for County Executive Maggie Brooks, declined to comment on Thursday's meeting.

But Seil said COMIDA is accountable, having to hold monthly board meetings and hearings on large projects.

"I feel that we are very open," Seil said.

Seil also presented a picture of COMIDA that has created jobs. In 2006, COMIDA had 502 projects. The companies receiving benefits employed 35,551 people when they applied for COMIDA benefits and were supposed to create 2,695 jobs, Seil said. They ended up creating 13,587 jobs.

Benefits were revoked for six or seven of the 10 or 11 companies that had not met their job-creation goals over the past two or three years, Seil said.

But a 2006 Democrat and Chronicle analysis of comptroller data from 2001 through 2005 showed that job creation was an elusive goal. Thirty-one projects lost jobs and 13 had incomplete employment data.

An audit by the state Comptroller's Office, released Monday, showed additional problems with COMIDA.

The report says the county improperly used $2.5 million in state grants intended for airport improvements to attract AirTran Airways to Rochester.

The money, says the report, was given to the airline by COMIDA, even though documents show that was not the stated purposed of these grants.

County officials say that all along the $2.5 million was meant to go to the airline.

Democratic county lawmakers have since called for a criminal investigation and introduced legislation to increase COMIDA accountability by, for example, requiring a clear statement of purpose whenever COMIDA transfers funds to another recipient.

On Wednesday, Legislature President Wayne Zyra, R-Sweden, returned the proposal to the Democrats, saying the County Legislature "does not have jurisdictional authority" to take the actions requested.

COMIDA is supposed to generate local jobs. Frank Wirt, president of the Rochester Building and Construction Trades Council, said at the forum that while there's a 100 percent local labor policy attached to much of the construction work that COMIDA produces, a waiver provision has created a loophole.

Waivers, he said, are permitted if no local labor is available to provide a particular needed skill, but waivers have been granted even when the labor representative on the three-member board that grants these exceptions has told the board that a local labor pool is available, Wirt said.

Jeannette Mitchell, an associate professor of economics at Rochester Institute of Technology, called for economic impact studies to be done about the possible effects of granting a tax break to a business.

"COMIDA, in my opinion, is corporate welfare," she said.

Other speakers questioned whether in helping some businesses COMIDA was hurting other companies.

Rome Celli, vice president of the Monroe County School Boards Association, added, "When you grant a tax abatement to one property owner, you increase the tax burden upon all others."

He said COMIDA should have discussions with any school district that might be affected by a tax break under its consideration.

County Legislator Carla Palumbo, D-Rochester, who is minority leader, said her caucus will come up with an action plan for reform of COMIDA.

JGOODMAN@DemocratandChronicle.com