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Clever brake on IDAs; State Legislature should back effort to trim the ability to offer tax breaks

Critics who are frustrated with the functioning of Erie County's municipal industrial development agencies should have a close look at what Assemblyman Sean Ryan is proposing. The Buffalo Democrat has drafted a bill that would help end some of the abuses of the local IDAs. The solution would be both effective and fair, though we suspect the local IDAs, themselves, won't see it that way.

The problem with local IDAs was placed in sharp relief by the recent deal that saw Premier Liquors move from Tonawanda to Amherst, with Erie County taxpayers helping to foot the bill. The Amherst IDA offered tax breaks to the company, which wanted to move. Because of state laws governing IDAs, the town IDA was able to offer tax breaks that were paid for by taxpayers all across Erie County.

Thus, not only did residents of the Town of Colden pay for the privilege of helping Premier Liquors make its move from Tonawanda to Amherst but, compounding Tonawanda's injury, its residents also paid to help underwrite their own loss. And still, leaders of local IDAs defend their existence.

Many observers have called for abolishing the local IDAs, leaving only the Erie County agency to offer county-wide incentives and, thus, discouraging awards for intra-county moves such as the one by Premier Liquors. It's a sensible idea, but one appears to have little chance of becoming reality. While moving a liquor store a few miles can hardly be called industrial development, the local IDAs are their own jobs program and they have their supporters, though we hope that Senate Republicans are not among them.

Ryan is taking a different approach. Rather than seeking to abolish the local IDAs, his bill proposes to restrict their authority to grant local tax breaks, unless they are given permission to offer county or state incentives. Thus, in the case of Premier Liquors, Amherst would have been limited to offering incentives whose costs would have been borne exclusively by Amherst taxpayers, not Tonawanda's or Colden's or the rest of Erie County.

The fairness of this legislation is beyond dispute. If local IDAs truly need to exist — they don't, but never mind — their ability to commit taxpayers' money should be restricted to the taxpayers of its municipality. That still leaves the Erie County IDA to offer incentives on a countywide basis in cases that it deems appropriate (though its own decisions have been suspect often enough).

Ryan's legislation is, thus far, a one-house bill. No member of the Senate has sponsored it. Perhaps it hasn't grabbed enough attention in that chamber yet, or maybe the Republicans who are clinging to a thin majority simply don't want to take on the local IDAs, especially in an election year. Neither answer is sufficient.

Republicans got into trouble in New York in part because they decided that to survive, they had to act like Democrats. They bowed to the unions, imposed unfunded mandates and generally helped to drive state taxes to unsustainable heights. In a crazy twist, though, Democrat Ryan is the conservative here, looking out for taxpayers, while Republicans are thus far content to let local IDAs continue to pilfer taxpayers' bank accounts for no good reason.

Ryan has proposed a clever and unanswerable solution to a real and ongoing problem. The Assembly should be eager to approve it while Senate Republicans look around for someone who gives a hoot.