The New York City Economic Development Corporation is the city's primary agency responsible for fostering economic growth through infrastructure investment, business support, and the management of city-owned assets. This page covers CBC’s work on the NYC Ferry system’s finances, the use of discretionary tax incentives, the management of economic development contracts, the effectiveness of regional economic development councils, and strategies for promoting job creation.
This page was created with AICBC Insights uses AI to group, analyze and present data and recommendations from CBC's publications. Always reference the cited sources to verify important details..
The Economic Development Corporation should eliminate the lowest-ridership routes to reduce the ferry subsidy.
The Economic Development Corporation should target subsidies to those in the greatest need of affordable transit options.
The Economic Development Corporation should increase fares for other riders to match those of comparable premium transit services, like the $7 per trip charged for the MTA’s express bus system.
The Economic Development Corporation should continue to hold the line on service expansions absent rigorous analysis that they would be financially feasible.
The EDC should eliminate the lowest-ridership routes to reduce the total subsidy.
The EDC should avoid money-losing expansions to reduce the total subsidy.
The EDC should target subsidies to those in the greatest need of affordable transit options.
The EDC should increase fares for other riders to match those of comparable premium transit services, like the MTA’s express bus system.
The EDC should structure the discounted 10-ticket package so that it can only be used by individual commuters and not by groups.
The EDC should include the cost of debt service on City capital spending related to the ferry system in its supplementary financial data.
Key Data
As of September 2024, NYC Ferry remains one of the most heavily subsidized transit options, with a per-ride subsidy of $8.55 in fiscal year 2023 and a total annual subsidy of $56.5 million.
As of November 2021, City-funded spending grew by more than 6 percent annually in fiscal years 2018 and 2019, with fiscal year 2022 expenditures expected to be $18 billion, which is 34 percent higher than in fiscal year 2014.
As of June 2020, EDC's finances showed that between 2015 and 2019, operating revenue increased 10 percent to $382.7 million, while operating expenses grew 36 percent to $384.2 million, resulting in a 2019 operating loss of $1.8 million.
As of December 2019, since the inception of the Regional Economic Development Councils (REDCs) in 2011, the State has allocated $6.2 billion in grants and tax credits, averaging $773 million per year.
48,000 is the number of new homes to be created when we add together the 40,000 that should be enabled by 5 neighborhood rezonings and the current proposed plan to redevelop the Brooklyn Marine Terminal. New York must dramatically increase housing production if it is going reduce its affordability problems…
CBC's Andrew Rein was joined by NYC Director of City Planning Dan Garodnick and NYCEDC President & CEO Andrew Kimball for a wide-ranging discussion on job and population trends, housing affordability, and economic development in a time of uncertainty. Dan Garodnick is Director of the New York City Department of…
The NYC Ferry system, while improved by recent fare increases and operational efficiencies, remains heavily subsidized, with a per-ride cost of $8.55 and a total annual subsidy of $56.5 million. These ongoing costs divert significant resources from the Economic Development Corporation's core mission of fostering citywide economic growth, necessitating further reforms to ensure financial sustainability.
Recommendations related to Economic Development Corporation (EDC)
The Economic Development Corporation should eliminate the lowest-ridership routes to reduce the ferry subsidy.
The Economic Development Corporation should target subsidies to those in the greatest need of affordable transit options.
The Economic Development Corporation should increase fares for other riders to match those of comparable premium transit services, like the $7 per trip charged for the MTA’s express bus system.
The Economic Development Corporation should continue to hold the line on service expansions absent rigorous analysis that they would be financially feasible.
Key Data
$8.55
— Per-ride operating subsidy in fiscal year 2023.
$56.5 million
— Annual total subsidy for NYC Ferry.
$429.2 million
— Capital committed by the City of New York through fiscal year 2023 for NYC Ferry to acquire ferry boats, improve docks and piers, and build two homeports.
$26.4 million
— Estimated annual debt service on NYC Ferry capital commitments.
$12.54
— The full per-ride subsidy when accounting for debt service.
$73.8 million
— Retained rental payments from the 42nd Street Development Project in fiscal year 2023.
4.67 million is the total number of jobs in New York City, just shy of employment pre-pandemic. Though the economy is stable and employment generally strong, challenges remain. The economy is undergoing longer term transformation including remote work, which will affect our labor market and commercial real estate, and the…
Prior to his appointment in 2022, Andrew served as the CEO of Industry City, where he directed the transformation of the long-underutilized industrial facility in Sunset Park, Brooklyn. Under his leadership, Industry City invested over $450 million in infrastructure and place-making initiatives, and grew thousands of jobs and hundreds of…
The NYC Ferry system requires significant subsidies, with an average per-trip cost of $9.85 in fiscal year 2021, which forces the diversion of tens of millions of dollars from other economic development initiatives. To protect the agency's core mission, the ferry system must reduce costs by eliminating low-ridership routes, increasing fares to match comparable transit services, and better targeting subsidies to those in need.
Recommendations related to Economic Development Corporation (EDC)
The EDC should eliminate the lowest-ridership routes to reduce the total subsidy.
The EDC should avoid money-losing expansions to reduce the total subsidy.
The EDC should target subsidies to those in the greatest need of affordable transit options.
The EDC should increase fares for other riders to match those of comparable premium transit services, like the MTA’s express bus system.
The EDC should structure the discounted 10-ticket package so that it can only be used by individual commuters and not by groups.
The EDC should include the cost of debt service on City capital spending related to the ferry system in its supplementary financial data.
Key Data
$9.85
— Average per-trip subsidy for NYC Ferry in fiscal year 2021.
$25
— Potential subsidy per trip for the proposed Coney Island ferry expansion.
$40 million
— Revenue diverted by the EDC in fiscal year 2019 to cover ferry operating gaps.
$25 million
— Cash reserves diverted by the EDC in fiscal year 2019 to cover ferry operating gaps.
$30 million
— Federal COVID-related aid used in fiscal year 2022 to support ferry operations.
20 percent
— Portion of operating expenses covered by fare revenues in fiscal year 2019.
The New York City Economic Development Corporation is implementing variable pricing and improved financial reporting for the ferry system, which has historically been highly subsidized. Future success depends on reducing these subsidies and ensuring that remaining funds are targeted toward those with the greatest need for affordable transit options.
Recommendations related to Economic Development Corporation (EDC)
The Economic Development Corporation should strongly consider a single-ride ticket price closer to the MTA’s express bus fare to better align ferry costs with other transit options.
The Economic Development Corporation should implement higher fares on weekends and for the longer, more expensive routes to better reflect the cost of service.
The Economic Development Corporation should reassess the most subsidized routes to determine if they provide the broad-based value and effectiveness the public deserves from its resources.
The Economic Development Corporation should evaluate the impact of the new fare system on NYC Ferry’s ridership and finances, and if appropriate, increase fares or change routes and timetables.
To properly calculate the per-ride subsidy, the Economic Development Corporation should include all direct and indirect spending on ferry operations, as well as City spending including debt service for all capital expenditures, in its financial reports.
Maria Torres-Springer is New York City's Deputy Mayor for Economic and Workforce Development, charged with spearheading the Administration’s efforts to strengthen and diversify the City's economy, invest in emerging industries, bolster small business, connect New Yorkers to family-sustaining jobs and expand access to arts and culture. Previously, Maria served as…
The New York City Economic Development Corporation should refocus its efforts on its primary economic development mission rather than managing ferry operations or capital procurement. This shift is part of a broader strategy to rationalize economic development incentives and ensure the city's recovery is broad and sustainable.
Recommendations related to Economic Development Corporation (EDC)
The City should also focus the Economic Development Corporation (EDC) on its core economic development mission rather than ferry operation or capital procurement.
The incoming Administration should increase transparency by publishing a comprehensive database of economic development incentives, including benefits paid, jobs created, and economic impact.
The Administration should assess the impact and return on investment of as-of-right economic development programs, including the Industrial and Commercial Abatement Program (ICAP), the Relocation and Employment Assistance Program (REAP), and Lower Manhattan incentives.
The Economic Development Corporation has faced increasing financial strain as operating expenses, driven largely by the NYC Ferry system, have outpaced revenue growth, leading to an operating loss in 2019. To address these fiscal pressures, the agency must implement further efficiencies, such as modifying ferry fare policies and halting costly expansions, to preserve its core economic development mission.
Recommendations related to Economic Development Corporation (EDC)
The Economic Development Corporation should continue to identify ways to make its ferry operations more efficient, such as implementing dynamic fare pricing and delaying the launch of costly planned expansions.
The Economic Development Corporation should modify the ferry system’s fare policy and planned expansions to generate additional recurring savings.
The Economic Development Corporation should charge higher fares on weekends and for noncommuters and not run or expand routes to Coney Island and Ferry Point that will require extraordinarily high subsidies.
Key Data
$53 million
— The amount the Economic Development Corporation spent to subsidize the NYC Ferry system in 2019.
$1.8 million
— The operating loss the Economic Development Corporation closed with in 2019.
$10 million
— The estimated reduction in operating costs for fiscal year 2021 resulting from service cuts and route recalibrations.
$9.34
— The subsidy cost per ferry ride.
$382.7 million
— The total operating revenue for the Economic Development Corporation in 2019.
$384.2 million
— The total operating expenses for the Economic Development Corporation in 2019.
New York State's Regional Economic Development Councils (REDCs) have received $6.2 billion in funding since 2011, yet the program suffers from a lack of strategic alignment, dispersed investment, and inadequate performance reporting. To improve effectiveness, the state should mandate standardized metrics, prioritize projects that align with long-term economic strategies, and increase the weight of regional assessments in funding decisions.
Recommendations related to Economic Development Corporation (EDC)
All projects funded through the REDC process should align with the long-term economic development strategies with the greatest likelihood of spurring job growth in regional population centers.
REDCs’ project assessments should be a greater factor in funding decisions in order to increase adherence to regional strategies.
REDCs should use uniform metrics to report the progress of individual projects and overall regional performance, with an aggregated report of all statewide activity.
The State should establish standardized metrics for regional performance and require project-level reporting on progress, employment, and spending.
The REDCs’ project scores should count as a greater proportion of the total assessment.
Key Data
$6.2 billion
— Total state grants, tax credits, and other funding allocated to businesses and localities since the REDCs' 2011 inception.
$773 million
— Average annual funding allocated to businesses and localities through REDCs since 2011.
$4.4 billion
— Total state spending on economic development in 2018, including direct expenditures and forgone tax revenue.
$2.5 billion
— Total state economic development-related tax expenditures in 2018.
$1.8 billion
— Total state economic development direct spending in 2018.
$863 million
— Total REDC funding awarded in 2018.
New York City's economic development efforts cost $3.2 billion in 2016, with a significant portion of these funds allocated through discretionary tax benefits that lack standardized criteria and sufficient transparency. To improve outcomes, the City should prioritize infrastructure investments in underdeveloped neighborhoods, standardize tax benefit awards, and focus the Economic Development Corporation's mandate on job creation rather than managing unrelated transportation projects.
Recommendations related to Economic Development Corporation (EDC)
The City should establish more detailed standards for awarding discretionary tax expenditures.
The City should improve transparency and reporting on EDC projects.
The City should make capital investments in infrastructure to support job growth in underdeveloped neighborhoods.
The City should use conduit financing to support growth in the arts, health, and educational sectors.
The City should keep the Economic Development Corporation's focus on job creation.
Key Data
$3.2 billion
— The annual cost of the City’s economic development efforts in 2016.
$548 million
— The value of substantial discretionary tax benefits awarded by the City in 2016.
$30,000
— The threshold below which most projects received benefits per job created.
$100,000
— The threshold above which three projects received benefits per job created.
87%
— The portion of conduit debt issued since 2016 for the cultural, educational, and health sectors.
16.2%
— The share of private employment in New York City located in Brooklyn as of 2016.
$3.2 billion -- how much New York City spent on economic development in 2016, including tax expenditures, operating costs, and capital spending. NYCEDC President and CEO James Patchett joins the podcast to discuss the City's development strategy, tax breaks, NYC Ferry and the BQX project.
New York City invests billions annually in economic development programs, yet these efforts require more rigorous management and cost-effectiveness to ensure they truly benefit the city's economy. While some progress has been made in areas like conduit financing and evaluating tax expenditures, further reforms are needed regarding discretionary tax benefit standards and the transparency of the Economic Development Corporation's operations.
Recommendations related to Economic Development Corporation (EDC)
Make as-of-right tax expenditures more cost-effective with continued reform.
Create more detailed standards for awarding discretionary tax expenditures.
Make capital investments in infrastructure to support job growth in underdeveloped neighborhoods.
Manage EDC programs with a focus on job creation and improving transparency.
Use conduit financing to support growth in the arts, health, and educational sectors.
Key Data
$3.2 billion
— The annual cost of the City's economic development efforts in 2016.
$622 million
— Total capital spending on economic development in 2016.
$534 million
— Operating costs for the Department of Small Business Services, the Economic Development Corporation, and various local development corporations in 2016.
$8.9 billion
— The collective amount of conduit debt outstanding in 2016.
$2.072 billion
— The total amount of tax expenditures in 2016.
$446 million
— The amount of capital spending undertaken by the Economic Development Corporation in 2016.
CBC Breakfast Series NYCED President and CEO James Patchett joined the CBC to discuss the role of NYCEDC during a period of economic growth in New York City.
Responsibility for awarding economic development awards should be transferred to the Empire State Development Corporation to centralize oversight and eliminate awards by state non-profits and SUNY. Furthermore, transparency should be improved by creating a public database of business subsidies, similar to those implemented in six other states.
Recommendations related to Economic Development Corporation (EDC)
Transfer responsibility for awarding all economic development awards to the Empire State Development Corporation (ESDC), and end awards by state non-profits and SUNY.
Create a ‘Database of Deals’ that allows the public to see the total value of all forms of subsidies awarded to a business.
Key Data
$250k
— The threshold for state contracts that the comptroller should be empowered to review and approve.
6
— The number of states that have already created a 'Database of Deals' to allow the public to see the total value of subsidies awarded to a business.
The state's reliance on non-profits and the university system to award economic development contracts has created a system prone to corruption, as evidenced by a scandal involving over $1 billion in public funds. To restore public trust, the state should consolidate procurement authority under the Empire State Development Corporation, implement transparent contracting standards, and establish a public database to track business subsidies.
Recommendations related to Economic Development Corporation (EDC)
Require competitive and transparent contracting for the award of state funds regardless of the contracting entity.
Transfer responsibility for awarding all business subsidy awards to the Empire State Development Corporation and end the use of state non-profits and SUNY in awarding these subsidies.
Empower the Comptroller to review and approve all state contracts to ensure independent oversight.
Create a Database of Deals that allows the public to see the total value of all forms of subsidies awarded to a business.
Limit campaign contributions from anyone who has or is seeking a state contract to reduce the potential for conflicts of interest.
Key Data
$750 million
— The estimated value of the bid-rigging scandal involving state-controlled non-profits and SUNY Polytechnic.
$1 billion
— The amount of public funds affected by the scandal involving systemic problems in how the state awards large contracts.
6
— The number of states that currently have a 'Database of Deals' to track subsidies awarded to businesses.
19
— The number of states that have implemented 'pay to play' laws to limit campaign contributions from those seeking state contracts.
A recent bid-rigging scandal involving New York's upstate economic development program has exposed systemic flaws in how the state awards large contracts and subsidies. To prevent future abuse, watchdog groups are calling for reforms that include centralizing subsidy awards under the Empire State Development Corporation, increasing transparency through a public database, and strengthening oversight of state contracts.
Recommendations related to Economic Development Corporation (EDC)
Require competitive and transparent contracting for the award of state funds, regardless of the contracting entity.
Transfer responsibility for awarding all business subsidy awards to ESDC, and end the use of state non-profits and SUNY in awarding these subsidies.
Empower the Comptroller to review and approve all state contracts.
Create a Database of Deals that allows the public to see the total value of all forms of subsidies awarded to a business.
Explore options to limit campaign contributions from anyone who has or is seeking a state contract.
Key Data
$1 billion
— The amount of public funds affected by the scandal involving the state's economic development program.
6
— The number of states that currently have a Database of Deals to track subsidies awarded to businesses.
19
— The number of states that have "pay to play" laws to limit campaign contributions from those seeking state contracts.
The state has committed nearly $3 billion to projects reviewed by Regional Economic Development Councils, yet a widespread lack of reporting on project outcomes has limited the ability to track performance at both the regional and project levels. To improve accountability, the state must collect and publish standardized, project-level data on total costs, jobs created, and jobs retained for all funded initiatives.
Recommendations related to Economic Development Corporation (EDC)
ESD should collect more information for its centralized CFA Data Table to allow for comparisons across year of award, industry sectors, state agencies, and project types.
Actual project-level information on total costs, jobs created, and jobs retained for all projects should be collected and published annually.
Better monitoring and performance evaluation is necessary for analyzing the use of limited state resources for economic development and assessing which projects are successful in leveraging private funds.
Key Data
$3 billion
— The total amount the State has committed to projects reviewed by Regional Economic Development Councils through 2014.
$1.5 billion
— The amount to be distributed to three upstate regions based on the competition entitled the “Upstate Revitalization Initiative.”
3,323
— The total number of projects which have been awarded funding since the initiative’s inception.
385
— The subset of Priority Projects begun in 2012 that were selected for detailed performance analysis.
New York City spends nearly $3 billion annually on economic development, yet many tax subsidies support projects that would be profitable without government assistance. To improve effectiveness, the city should prioritize infrastructure investments in neighborhoods with growth potential over direct subsidies to individual firms and implement stricter monitoring of job creation promises.
Recommendations related to Economic Development Corporation (EDC)
The city should reduce the length of benefits provided and exclude projects that clearly will be profitable without subsidies.
The city should monitor economic development deals more closely and structure them to provide benefits only after firms provide proof they have met their job creation promises.
The city should narrow economic development investments to those that enhance infrastructure in neighborhoods with growth potential.
The beneficiaries of city capital dollars should be neighborhoods, not individual firms.
Key Data
$3 Billion
— Annual spending by New York City to cultivate industries, attract and keep businesses, and stimulate development.
New York City's economic development strategy has relied on a mix of tax expenditures, capital spending, conduit financing, and zoning, with the Economic Development Corporation serving as the lead agency. While these tools have supported growth in specific sectors and neighborhoods, the city should improve transparency, establish clearer standards for discretionary benefits, and reform as-of-right tax programs to ensure cost-effectiveness.
Recommendations related to Economic Development Corporation (EDC)
Use capital investments to enhance infrastructure in neighborhoods with job growth potential.
Encourage growth in the cultural, medical and educational sectors by enhancing access to capital through conduit financing.
Continue reform of as-of-right tax expenditure programs to make them more cost-effective.
Establish clearer standards for awarding discretionary tax expenditure benefits.
Continue rezoning and expand special mixed use districts to facilitate diversified job growth in areas currently limited to industrial use.
Better manage the Economic Development Corporation by focusing on job creation and enhancing transparency.
Key Data
$1.6 billion
— Annual tax expenditures for economic development in 2012.
$751 million
— Annual capital spending for economic development in 2012.
$9.7 billion
— Total conduit debt outstanding for economic development projects.
$9.2 billion
— Total face value of conduit bond issues supported by the New York City IDA, Trust for Cultural Resources, and Build NYC between 2002 and 2012.
$2,000 to $398,000
— Range of discretionary benefit amounts awarded per job in fiscal years 2010 and 2011.
$368 million
— Relevant operating expenditures for economic development in 2012.
New York State and its local governments spend nearly $7 billion annually on economic development, yet many programs lack transparency and accountability. To improve the effectiveness of these investments, the state should standardize performance metrics, eliminate ineffective programs, improve project scoring consistency, and create a unified economic development budget.
Recommendations related to Economic Development Corporation (EDC)
ESD should facilitate the development and reporting of meaningful and consistent metrics across all Councils and programs.
New York’s leaders should consider using the cap mechanism more widely to foster a more disciplined approach.
ESD should facilitate the convergence and standardization of the multiple criteria and scoring methods, making them more useful for decision making.
The CFA should be expanded and should serve as the platform for a unified economic development budget, or UEDB.
The State should draw from best practices in the regions to improve and standardize performance information.
Key Data
$7 billion
— New York State and its local governments will spend close to $7 billion this fiscal year in the name of economic development.
$762 million
— New York will allocate $762 million in economic development funds through the recently created Regional Economic Development Councils.
$781 million
— New York City’s Economic Development Corporation spent $781 million in city fiscal year 2011.
$100 million
— The new Excelsior program will cost $100 million in tax year 2012.
$359 million
— The state film tax credit grew from $130 million in 2010 to $359 million in 2012.
New York City's economic development reporting often fails to capture the full scope of spending, as evidenced by the FreshDirect incentive package where significant portions of the total cost are excluded from official cost-benefit analyses. To improve transparency and accountability, the Economic Development Corporation should incorporate debt service for capital commitments into its analyses and finally convene the methodology recommendation committee mandated by local law.
Recommendations related to Economic Development Corporation (EDC)
The Economic Development Corporation should include in its cost-benefit analysis the debt service associated with project-related capital commitments, in the same way it includes the costs of PILOTs, sales tax exemptions, and other incentives.
The methodology recommendation committee, created as part of Local Law 48, should be appointed and convened to discuss necessary changes and adjustments to reporting measures.
Key Data
$125 million
— Total incentive package provided to FreshDirect for its relocation and expansion into the Bronx.
$1.4 billion
— Total assistance provided to more than 620 development projects over their lifespans as of 2011.
$265 million
— Average annual capital commitments made by the Economic Development Corporation over the past decade.
$8,000
— Cost per job created based on the nearly $700 million in assistance provided through 2011.
$71.5 million
— Portion of the FreshDirect incentive package included in the official cost-benefit analysis.
$33.9 million
— Amount of state assistance for the FreshDirect project that is excluded from city reporting.
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