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Vanishing promise of hundreds of FedEx jobs calls town IDA practices into question

The huge discrepancy in the number of jobs to be created by the new FedEx facility in Hamburg puts the spotlight on the town’s Industrial Development Agency, which granted the company millions of dollars in tax incentives.

Moreover, it supports the argument for a single, countywide IDA.

Four hundred or more jobs were supposedly to have been created at the FedEx Ground Transport project. The number had gone as high as 600 and was mentioned both by the town supervisor and a U.S. senator.

There was only one problem. It was not the number FedEx used when it applied for $8 million in tax breaks. Hamburg IDA Executive Director Michael Bartlett claims not to know if the 400 to 600 numbers were ever documented.

As has been reported, the shipping giant is building a $54 million plant off Route 5 in Hamburg. The company projects 32½ jobs would be created by 2020 – a far cry from 400, much less 600. Officials say outside contractors might employ another 175, although there’s no word whether those would be full- or part-time jobs.

Sen. Charles E. Schumer’s staff pointed out that the figure of 400 to 600 jobs “has been in the public realm for months.” A press release from the senator’s office boasted about the project’s jobs potential. Hamburg Supervisor Steven Walters, who is chairman of the town IDA, told reporters within the last few weeks that the project “will create 400 to 600 jobs.”

The reality is not even close to that. What is real is that FedEx is getting a pretty good deal – $8 million in tax breaks in return for a few dozen jobs. The Hamburg IDA, which stays in business by taking a cut of projects it approves, is presumably also coming out ahead.

Bartlett, the Hamburg IDA chief, defends the subsidy for the small number of jobs, pointing out that FedEx was also considering a site in Erie, Pa.

It may be that spending $8 million for 32½ jobs is better than watching those jobs go elsewhere, but the deal is just the latest questionable decision by the many municipal IDAs in Erie County.

Rather than criticize these deals as they come up, Albany should limit each county to a single, countywide IDA with increased accountability and tighter rules. That will help determine which projects are truly worthy of public support.