No Bang for the Buck

No Bang for the Buck

New York State spent $2.8 billion on state and local tax breaks for businesses in the five years 2007 through 2011, State Comptroller Thomas DiNapoli said Tuesday in a new report.

DiNapoli says that money generated more than a million jobs at an average cost of about $2,700.

That sounds like a pretty good deal for taxpayers. If only it were true.

But the fact is that New York State did not add a million jobs during those years. It lost jobs.

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DiNapoli gets his "performance" data from reports filed by the 113 local Industrial Development Agencies, or IDAs, that hand out tax breaks. These agencies generally charge applicants a 1% fee on the value of their deals, which provides them with a continuing stream of income -- so long as they keep approving more tax break deals to generate more fees.

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View David Cay Johnston's opinion in its entirety on the taxanalysts® Blog.

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