Long Island ranks No. 2 behind New York City in the number of jobs created by industrial development agencies, according to a new report.
The office of state Comptroller Thomas P. DiNapoli found 40,697 people had been added to local payrolls as of Dec. 31, 2020, by expanding businesses, housing developments and other projects that were awarded tax breaks by the Island’s eight IDAs in recent years. That’s 24% of the 167,984 jobs created statewide by IDA projects.
In New York City, IDA projects had added 43,314 jobs as of the end of 2020. It was the first time in five years that the city edged out Long Island in terms of IDA-related job growth.
Locally, Suffolk County IDA projects hired the most people, 14,246, followed by Nassau County IDA projects with 9,909. The two trailed only the New York City IDA in terms of job creation across the state.
The comptroller calculated the “net jobs gained” at each project by comparing its 2020 employment with that for the year before the project received IDA help.
DiNapoli’s annual IDA report card looked at hiring that took place over multiple years because IDAs confer tax breaks for 10, 15, 20, and in a few cases, 40 years. The duration of the aid depends on the project’s size and the number of jobs to be created and retained. Companies failing to keep their employment promises can have their tax breaks rescinded.
“IDAs can play an important role in helping local economies and businesses expand and recover after the pandemic,” DiNapoli said on Friday. “The tax breaks they provide do impact local taxes and should be looked at closely.”
On Long Island, the Suffolk IDA’s 139 projects had the lowest tax incentives per new job, $720, while the Glen Cove IDA’s 10 projects had the highest, $60,437 per job, according to the report card.
Islandwide, the 2020 tax savings received by 820 projects totaled $210.4 million off their property, sales and mortgage recording taxes. That translates to $5,170 in tax breaks per job gained and $72 per Long Island resident.
The Suffolk IDA “is focused on identifying projects that strike the right balance in aiding business retention and expansion while also maximizing employment opportunities for residents,” said executive director Anthony J. Catapano.
In Glen Cove, Ann S. Fangmann, executive director of the city’s IDA, said it “has a higher percentage of residential projects than most other IDAs and these projects produce fewer jobs per dollar of benefit.” Glen Cove IDA projects had created 233 jobs as of the end of 2020.
She said the Garvies Point and Village Square housing projects in the city’s downtown “will spur spinoff economic development that does not show up in the state-generated statistics.”
The report card consists of data from all active IDA projects, whether they’ve been receiving tax savings for many years or just one year.
Among the Island’s new projects, Hempstead Town IDA’s support for the Selby apartment complex at 695 Merrick Ave. in Westbury had the highest investment by a developer — $127 million — and the largest total tax exemption — $2.2 million in 2020. The luxury apartments that overlook Eisenhower Park are to rent for between $2,700 and $8,000 per month, according to the developer, Beechwood Organization.
“Housing is absolutely necessary on Long Island and our board considered that the project was deserving of benefits,” said Fred Parola, CEO of the Hempstead IDA. “The property was lying vacant and dormant and this project, when completed, will provide an economic boost to the area with residents who are in a position to help the local economy.”
The Nassau IDA provided $75.6 million in tax breaks while the Suffolk IDA provided $10.3 million in tax savings in 2020. The large disparity is due in part to the Neptune electrical cable project that accounts for an outsized amount of Nassau’s tax breaks.
Nassau IDA chairman Richard Kessel said the agency is fulfilling its mission “to pump up the Nassau County economy and to create jobs and opportunities for people” through the support of proposed apartment buildings on the long-vacant Superblock site in Long Beach and an Amazon warehouse at the former Cerro Wire site in Syosset.
“I totally respect the report card, but I think that statistics don’t tell the story,” he said.