New York City "corporate retention" deals

---------- Forwarded Message ----------
From: Greg LeRoy <goodjobs@xxxxxxxxxxxxxxxxx>  
To: goodjobs@xxxxxxxxxxxxxxxxx 
Subject:    NYC Deals Failing 
Date:    Feb 9, 2004 12:36 PM 


For Release Thursday, February 5, 2004 
Contact:  Bettina Damiani 212-414-9394 or cell 347-432-0315 

Study: NYC Corporate Retention Deals Lose Jobs 

New York City -- Good Jobs New York today released a report that finds New York 
City's costly corporate retention policy is failing to retain or create jobs.  

The report -- Know When to Fold 'Em: Time to Walk Away From NYC's "Corporate 
Retention" Game -- is based upon an analysis of contracts never before 
disclosed between the city and 13 large corporations; it is available at 
www.goodjobsny.org.

Despite the failed policy, the City is considering $42 million in tax breaks 
for Bank of America; a public hearing on the deal will take place 10 a.m. 
Thursday, February 5 at the New York City Industrial Development Agency (IDA), 
110 William Street in Manhattan. 

Analyzing 13 of the biggest -- and heretofore secret -- deals, GJNY found that 
the agreements actually allow firms to lay off up to 20% of their workers 
before triggering any real penalties.

"Our report finally sheds light on a process that allows some of the world's 
wealthiest corporations to take money from taxpayers and then pay back 
residents and employees with layoffs," said Bettina Damiani, Project Director 
of GJNY. 

Report highlights include: 

** All agreements GJNY examined had "employment cushions" allowing companies to 
lay off workers without having the subsidy cancelled.

** Many agreements contain "low-balled" job retention targets set below the 
number of jobs companies had at the time they signed their deals. 

** Only one subsidized company that GJNY studied paid the city back when it 
moved its operations out of New York City. 

** Public reporting on the outcomes of these deals provides data that is 
inconsistent with internal IDA reporting documents, making it impossible to 
evaluate the success or failure of individual deals.

Massive economic development tax breaks to corporations and developers under 
the guise of creating jobs must be re-examined, the report states.  The study 
details reforms the city can adopt to do a better job of ensuring that 
taxpayers get the best bang for the buck. 

  
Editor's note: GJNY is a joint project of the Fiscal Policy Institute (FPI) and 
Good Jobs First (GJF).  FPI is a nonpartisan research and education 
organization based in Albany and New York City.  GJF is a non-profit, 
non-partisan research center promoting best practices in economic development; 
it is based in Washington, DC. 

# # # 
 


- - - - -
John Lacny

People of the US, unite and defeat the Bush regime and all its running dogs!


"[C]apital comes dripping from head to foot, from every pore, with blood and 
dirt."
--Marx, Capital, Vol. 1, Chapter 31

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