Upstate Job Growth Slow Despite Generous Taxpayer Subsidies

"The policies Cuomo says are focused on upstate and he claims have improved upstate were not the right policies and have not worked," said E.J. McMahon, research director of the Empire Center for Public Policy, a fiscally conservative watchdog group. Investigative Post, ProPublica, and the Columbia University Graduate School of Journalism teamed up to assess the state's economic development efforts since Cuomo took office in 2011. The work included developing a database to track nearly 16,000 subsidy deals involving 12 of the state's largest economic development programs and local industrial development agencies. An analysis of employment data, interviews with dozens of public officials and others, and a review of reports and audits of subsidy programs conducted by the state comptroller and watchdog organizations indicate the state's substantial investment in the upstate economy has not generated many jobs. Some companies have also used their influence to tap into a variety of subsidy programs, or placed executives on decision-making bodies that help determine how tax breaks and other forms of assistance are awarded. In the last fiscal year the total subsidies hit a record $8.6 billion, according to a calculation by the Citizens Budget Commission, a nonpartisan group that tracks state spending. The Start-Up New York program, which Cuomo said would "supercharge" the upstate economy by creating tax-free zones for businesses locating near college campuses, has been widely criticized for meager job creation despite heavy state spending to advertise it. [...] no state in the nation has helped finance more of these megadeals. Empire State Development, the state's primary economic development agency, declined requests for an interview with ESD President and CEO Howard Zemsky or another senior official. Cuomo's proposed state budget for the upcoming fiscal year calls for $644 million in additional economic development spending and $1.5 billion in tax credits. The government can never hope to recoup its investment through increased tax revenues, he said, shifting the tax burden for public services to other taxpayers. State officials said the program, which allows companies to operate tax-free for 10 years by locating near university campuses, would lure businesses to upstate. In the coming budget year, the governor proposes rebranding the program, reducing the number of jobs companies must promise to create and revising the eligibility criteria to focus more on genuine startups. Another of Cuomo's new initiatives, a system of 10 regional economic development councils that compete for state funding, has played to mixed reviews.