Maybe this will be the straw that breaks the IDAs’ backs. The Amherst Industrial Development Agency last week granted nearly $550,000 worth of tax breaks to personal injury attorney William Mattar for a $4 million expansion adjacent to his current office in the town.
The nature of the expansion seems mysterious and is definitely relevant. While Mattar’s original request was to fund a national practice and provide back office and support services for it, by the time last week’s vote was taken, it was being described by Mattar as “an advocacy group, not a law firm.” Its purpose, he said, will be to advocate for veterans and it will be staffed by advocates accredited through the Department of Veterans Affairs, along with support staff.
It was with that understanding that the Amherst IDA board voted to grant the tax breaks, but even then it’s a poor use of taxpayers’ money. Mattar says that the project will conservatively create 20 new jobs and that the new building will be able to handle up to 80 employees.
The question is whether this project would have been undertaken without the incentive. And Amherst Supervisor Barry Weinstein, a board member who voted against granting the request, also worried about commingling of the expenses of the law firm and the advocacy group. He also worried, appropriately, that the approval could set off a spate of other law firms following suit and asking taxpayers to support their business expansions.
There is at least one favorable aspect of the Mattar deal: With it, a tax-exempt property, once used as a church, will move onto the tax rolls. But would it have happened anyway, and if not, would someone else have come along at some point with a better plan for the property?
The Amherst IDA has become notorious for granting tax breaks to questionable projects, and with this one, state officials ought to wake up and institute reforms that protect taxpayers by insisting on common sense. Mainly, that means restricting IDAs to no more than one per county. There is no reason this project could not have come before the Erie County Industrial Development Agency, an organization that has a countywide perspective on economic development and the costs of the tax breaks it confers.
Erie County has six IDAs, including the county’s, and each can compel taxpayers countywide to cough up dollars to support projects that too often lack sufficient merit. Sometimes, a business simply moves from one town to another. Regardless, it’s a pernicious form of taxation – and without representation.
New York needs industrial development agencies or, lacking them, something to perform their critical role. Because New York’s tax structure is so far out of line with other states – which themselves may offer incentives – New York needs to offer financial carrots to lure businesses here and to keep existing ones from decamping to friendlier environs.
For that very reason, though, IDAs need to operate in an efficient and at least somewhat accountable manner. One way to do that is to eliminate municipal IDAs and concentrate that authority at the county level.
The vote to grant the tax break to Mattar was 5-2, but opposition also came from Erie County Executive Mark C. Poloncarz and Assemblyman Sean Ryan, D-Buffalo. Maybe this deal will be the one that will give them the ammunition to get the State Legislature to act.