The Amherst Industrial Development Agency is considering changes to its policies for dealing with companies that get tax breaks but don’t create the jobs or make the investments they promised.
The agency has long had a policy to clawback tax breaks that it granted to companies that obtained them through fraudulent means. The IDA’s directors on Friday approved a new recapture policy that continues that mandate, but also allows the agency to add provisions that would allow it to claw back subsidies from companies that failed to comply with a “material factor” considered when the agency approved the tax breaks.
Exactly what those factors are still hasn’t been determined, but they could include job creation and investment. The IDA board is likely to set those factors in the coming months. The policy also allows clawbacks if a company closes its Amherst location or moves it elsewhere.
“It gives the board the ability to define material factors,” said David Mingoia, the agency’s interim executive director.
For now, the Amherst IDA’s recapture policy is less severe than the one in place at the Erie County Industrial Development Agency, which allows clawbacks if a company fails to come within 80 percent of its job creation or investment promises.
The IDA has never recaptured tax breaks from a company for violating the agency’s recapture policy, Mingoia said. The policy also gives a company the opportunity to explain why it failed to meet the agency’s compliance terms.