Since 2007, the state Authorities Budget Office each year has issued an annual report on the finances and activities of New York’s 574 state and local authorities. But for the first time the ABO this week broadened the scope of its report to include a five-year look at authorities’ costs, debt, staffing and compensation practices.
The numbers this longer-term examination produced were interesting, to say the least. Some examples:
- At the end of 2012, state authorities had $151.1 billion in outstanding debt, an 18.6 percent increase since 2008.
- Debt issued by the state authorities for their own public purposes declined as a percentage of total outstanding debt to 27.3 percent from 40.8 percent. By contrast, the percentage of outstanding debt issued by state authorities "at the direction of state government for purposes unrelated to the mission of these authorities" climbed to 38.9 percent from 34.9 percent, and "conduit debt" on behalf of third parties also increased.
- Outstanding industrial development agency debt fell from $21.7 billion in 2008 to $16.4 billion in 2012. But, the ABO noted, since 2008 IDAs have not been allowed to issue debt for civic facilities. Since then, a dramatic increase in debt outstanding reported by not-profit local authorities-which increasingly are used to finance such projects-has occurred.
The 280 IDA projects first approved in 2008 and still active in 2012 received nearly $183 million in financial assistance based on commitments to create 9,100 jobs. As of 2012, however, they had generated only 7,458 new jobs.
The ABO report is long on such numbers, but short on analysis. Others rushed to fill that gap. Some IDA officials said the data on jobs created are wrong or misleading because they are pulled from a period when the economy was throttled by a severe recession. The opposing view is that tax breaks are just giveaways to companies.
Our own take is this: Overall, state and local authorities continue to add debt to an already hefty total. Regarding IDA tax incentives, yes, they do help create jobs-but at nearly $25,000 per job, the price is steep.
The ABO report is a useful starting point for a much-needed discussion about the operations of public authorities in this state.
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