Lupardo: Empire Zones Need Reform

BINGHAMTON – Assemblywoman Donna A. Lupardo (D-Endwell) said today the only way to truly fix the state’s broken Empire Zones program is to pass the Assembly’s reform plan she has sponsored (A.6). "Before we extend the program which expires at the end of March, serious reforms must be enacted."

"The Empire Zones program – designed to entice businesses to create jobs by reducing their taxes – has come under heavy criticism because of mismanagement and loopholes that allow businesses to receive tax credits without adding jobs," Lupardo said. "The Empire Zone program was created to encourage economic development, business investment and job creation. But in many areas it is not being run properly and there are serious questions about mismanagement and wasted taxpayer dollars."

The Assembly’s proposal reforms the Empire Zone program by:

  • replacing the ESD-controlled Empire Zones Designation Board with a three-member control board;
  • requiring each zone to reconfigure its boundaries to better address the needs of distressed communities and prevent the zones from sprawling into undeveloped space or more desirable suburban locations;
  • requiring the state Department of Taxation and Finance to certify that businesses receiving tax benefits through the program are legitimate; and
  • mandating annual reports to inform policymakers about the program’s job creation record.

Lupardo said that a 2004 report by the State Comptroller’s office cited inefficiencies with the Broome County Empire Zone. Just 13 local businesses studied met their job creation goals under the program, and 14 of the 39 businesses surveyed increased jobs but did not meet their goals by a total of 306 jobs. Eight of the 39 businesses did not meet goals and reduced staffing by a total of 221 jobs.

"If the program is to continue offering generous tax benefits, it must be reformed so that each zone maximizes its economic potential and taxpayers get a good return on their money," Lupardo said. "The Assembly’s reforms will help Empire Zones get back to the business of creating jobs and revitalizing struggling communities. I call on the Senate and the governor to support this legislation which will bring true reform to the Empire Zone program."