Major economic development projects in New York encompass the large-scale infrastructure investments, stadium subsidies, and corporate incentive packages used by the state and city to stimulate growth and revitalize specific districts. This page covers CBC’s work on regional economic development councils, tax expenditure transparency, infrastructure financing, corporate incentive programs, and the oversight of large-scale capital projects.
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 scope of Penn Station renovation should be tightly controlled and focused on efficient and safe passenger flow.
The State and City should resist calls to add purely cosmetic or non-essential project elements, lest an already costly project become unaffordable.
Abatements should be based primarily on promoting economic growth.
ESD should scrutinize any possible abatements based on whether projects would not be feasible without a specific PILOT discount amount.
This plan should not set a precedent for future rezonings or financings.
The City generally should lead rezonings, both within the central business district and for station area plans.
The State should continue to encourage denser development around station areas and consider intervening in local land use issues when local governments fail to enact appropriate transit-oriented development plans.
ESD should provide additional details about the assumed timing of public capital projects, financing actions, and funding flows, as well as high level contingency plans given the project’s uncertainties.
Key Data
In October 2026, the CBC reported that Micron's semiconductor fabrication facility in Clay, NY, is eligible for up to $7 billion in performance-based tax credits, which includes $5.5 billion in Excelsior tax credits over 20 years, $1.2 billion in sales tax exemptions, and $284 million in property tax abatements.
As of June 2022, the renovation and expansion of Penn Station was projected to be one of the costliest transportation projects in national history, estimated at $6 billion to $7 billion for the renovation and another $12 billion-plus for its expansion.
In March 2022, the CBC analyzed the proposed Buffalo Bills stadium subsidy, noting that a new stadium was estimated to cost between $1.4 billion and $1.7 billion, while the team's presence generates about $27 million in annual tax revenue for the city, county, and state.
In November 2018, the Amazon HQ2 deal in Long Island City involved a committed $2.5 billion investment by Amazon to create 25,000 jobs over 10 years, supported by up to $2.8 billion in combined state and city incentives.
In December 2017, the CBC highlighted that the Hudson Yards subway extension cost $3 billion to finance, with the City ultimately paying $359 million from its general fund to cover interest shortfalls and $266 million for capital cost overruns.
New York State and its local governments spent $12.7 billion on economic development in 2025, yet many of these programs and tax incentives lack clear evidence of generating economic growth or jobs. Despite these mixed results, spending continues to rise, increasingly focusing on advanced manufacturing projects like Micron's $7.0 billion semiconductor facility and Albany Nanotech's $500 million lithography tool.
Recommendations related to Major Economic Development Projects
New York should rigorously evaluate economic development programs and only spend resources on those that deliver measurable results.
Absent paying for itself, a tax break should only be renewed if there is clear evidence that the economic development program is the most cost-effective way to deliver a critical, quantifiable public benefit.
Rather than extending and expanding programs indiscriminately, New York State and its local governments should evaluate how effective existing economic development programs are and use those results to grow what works, and to shrink, eliminate, or reform what does not.
To support robust economic growth and direct precious resources wisely, New York State and its local governments should focus economic development dollars on programs that deliver results.
Rigorous evaluation of the impact and effectiveness of economic development programs is necessary to identify what works and reform what does not.
Key Data
$7.0 billion
— The maximum amount of performance-based tax credits that Micron's semiconductor fabrication facility in Clay, NY is eligible for.
$5.5 billion
— The amount of Excelsior tax credits over 20 years that Micron's semiconductor fabrication facility in Clay, NY is eligible for.
$1.2 billion
— The amount of sales tax exemptions during construction that Micron's semiconductor fabrication facility in Clay, NY is eligible for.
$284 million
— The amount of property tax abatements that Micron's semiconductor fabrication facility in Clay, NY is eligible for.
$500 million
— The cost of the Extreme Ultraviolet Lithography tool currently underway at Albany Nanotech.
$280 million
— The amount of funding pledged by the State for Empire AI and other public-private artificial intelligence consortia.
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…
$16 billion is the estimated cost to build the new rail tunnel under the Hudson River. Decades of delays and funding spats ultimately led to the creation of the Gateway Development Commission, the bi-state entity responsible for making the tunnel a reality. Joining the podcast is Alicia Glen, co-Chair of…
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…
50,000 is the number of jobs New York State expects to be created over the next 20 years by attracting Micron to central New York with $7.2 billion of incentives. New York has long been a leader in economic development, with the State and localities offering tax incentives and spending…
The Penn Station Area Civic and Land Use Improvement Project aims to revitalize the district and renovate the station, though its financing and scope require careful management to ensure fiscal responsibility. To maximize value for New Yorkers, the state and city must prioritize essential infrastructure, scrutinize tax abatements, and maintain local control over future rezoning efforts.
Recommendations related to Major Economic Development Projects
The scope of Penn Station renovation should be tightly controlled and focused on efficient and safe passenger flow.
The State and City should resist calls to add purely cosmetic or non-essential project elements, lest an already costly project become unaffordable.
Abatements should be based primarily on promoting economic growth.
ESD should scrutinize any possible abatements based on whether projects would not be feasible without a specific PILOT discount amount.
This plan should not set a precedent for future rezonings or financings.
The City generally should lead rezonings, both within the central business district and for station area plans.
The State should continue to encourage denser development around station areas and consider intervening in local land use issues when local governments fail to enact appropriate transit-oriented development plans.
ESD should provide additional details about the assumed timing of public capital projects, financing actions, and funding flows, as well as high level contingency plans given the project’s uncertainties.
Key Data
10-year
— The lookback period used to calculate 'make-whole' property tax payments to the City prior to construction.
3 percent
— The annual escalation rate applied to 'make-whole' property tax payments.
The proposed Penn Station Area Civic and Land Use Improvement Project aims to rezone surrounding blocks to fund station renovations through value capture, but faces significant financial risks and concerns regarding local control over tax revenue. With estimated costs reaching up to $19 billion for renovation and expansion, it is critical that the state and city collaborate on a financing plan that protects municipal resources and prioritizes essential infrastructure over cosmetic upgrades.
Recommendations related to Major Economic Development Projects
Before any financing plan is approved, the scope of work should be reasonably detailed, scrutinized, and streamlined as much as possible.
The State and the railroads should focus on improving safety, circulation, and functionality and doing so in the most cost-effective manner.
The State should avoid costly, non-essential, cosmetic improvements and should not preclude the possibility of future capacity or service enhancements.
It is important to evaluate how the State will manage and mitigate the financing risks inherent to value capture projects, including who will be responsible for interest payments and cost overruns.
The Mayor and City Council should guide whether and how much of the City’s future property tax revenue should be dedicated to specific needs, such as a mass transit project.
Key Data
$6 to $7 billion
— Estimated cost just for the renovation of Penn Station.
$12 billion-plus
— Estimated cost for the expansion of Penn Station.
The State should conduct a rigorous, transparent analysis to determine if a proposed stadium subsidy for the Buffalo Bills will yield benefits exceeding its costs, as past research shows sports facilities rarely provide significant economic growth. Any public investment must be justified by incremental economic impacts, follow best practices like requiring private investment, and include clawback provisions to protect taxpayer interests.
Recommendations related to Major Economic Development Projects
The State should transparently provide an analysis that identifies the benefits and full costs for any proposed stadium subsidy.
The analysis should credibly identify the incremental economic and fiscal impacts attributable to a proposed subsidy to calculate its value.
Any subsidy should be provided only after private investment and include clawback provisions.
The State should discount the benefits of a stadium subsidy by a factor that represents the benefit that would be accrued if those funds were used for another purpose.
If a State subsidy is proposed, the impacts should be used in a rigorous, transparent analysis that shows the incremental benefits will exceed the subsidy’s cost.
Key Data
$1.4 billion to $1.7 billion
— Estimated cost range for constructing a new stadium, depending on whether it is built with a roof.
$862 million
— Estimated cost to renovate the existing Highmark Stadium.
$385.8 million
— Estimated annual economic output generated by the presence of the Buffalo Bills.
$27 million
— Estimated annual fiscal impacts (tax revenue) generated by the presence of the Buffalo Bills.
$19.5 million
— Annual personal income tax revenue generated for the State of New York primarily related to the Buffalo Bills team payroll.
2,317
— Total number of jobs supported annually by the presence of the Buffalo Bills.
The proposed Penn Station Area Civic and Land Use Improvement Project aims to revitalize the area through new zoning and development, but lacks critical details regarding financing, cost estimates, and the City's role in the process. The project's reliance on value capture mechanisms requires further scrutiny to ensure it is the most cost-effective strategy and that it does not unfairly divert tax revenue from the City's general fund.
Recommendations related to Major Economic Development Projects
ESD should provide additional information to answer the following questions before proceeding with the GPP, specifically regarding the scope of capital improvements and the estimated cost for each phase.
New York City should have a substantive role in the planning process and should be a partner that agrees to the use of tax revenue that would otherwise flow to the City’s general fund.
The public approval process should include broader discussions about financing risks and the most effective strategies for mitigating and managing those risks.
There should be a robust discussion about potential tax incentives or abatements for redevelopment projects in the GPP district.
The plan should avoid costly, non-essential cosmetic improvements and should not preclude the possibility of future capacity or service enhancements.
Key Data
$17 billion
— Reported cost of the entire Penn Station project, including renovation, expansion, land acquisition, demolition, and public space improvements.
$6 to $7 billion
— Estimated cost of a scaled-back renovation project without the proposed Penn South expansion.
$1.3 billion
— Funding included in the State’s Fiscal Year 2022 Enacted Budget for Penn Station-related projects.
$150 million is the amount of capital funding NYC has committed toward the creation of a Center for Climate Solutions on Governors Island. Joining the podcast to discuss this and other plans for Governors Island is Alicia Glen, Chair of the Trust of Governors Island and the former Deputy Mayor…
Sarah Feinberg was appointed Interim President of New York City Transit in February 2020. Feinberg oversees the 48,000 person workforce of NYCT, as well as operations for New York City subways, buses, paratransit services, and the Staten Island Railway. Feinberg served as the Federal Railway Administrator from 2015 to 2017.…
29 is the number of acres in the proposed Special Flushing Waterfront District. In our third episode on land use and zoning, we move from Brooklyn to Flushing, Queens to discuss the proposed district that could add 3 million square feet of housing, hotel, retail and office space; remediate Flushing…
20,000 is the number of jobs that could be potentially created by proposed rezoning of Industry City, a sprawling retail, office, and manufacturing complex in Sunset Park, Brooklyn. But this week the developer pulled the plug on the proposal after negotiations with stakeholders came to a standstill. What went wrong,…
New York City's land use process must balance community needs with citywide interests to ensure the city continues to grow and adapt as a modern metropolis. The City Council should carefully evaluate the proposed Industry City rezoning to weigh community concerns against the potential for job creation without requiring direct public investment.
Recommendations related to Major Economic Development Projects
City leaders should work to advance and approve projects that help New York City continue to grow and adapt as a modern metropolis, particularly during times of economic crisis.
The City Council should carefully consider how best to balance community needs with citywide interests, which include the potential for job creation with no direct public investment required.
New York's Regional Economic Development Councils have received $6.2 billion in funding since 2011, yet the program suffers from dispersed investments and a lack of strategic alignment that hinders effective economic growth. To improve outcomes, the state should mandate that all funded projects align with long-term economic strategies and implement standardized, rigorous performance reporting.
Recommendations related to Major Economic Development Projects
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.
Only projects tied to an established regional or State strategy should be eligible for economic development-related financial assistance.
The State should establish standardized metrics for regional performance and require project-level reporting on progress, employment, and spending.
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 awarded 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.
The 2019 Economic Development Sweetener Scorecard tracks 67 legislative bills aimed at providing tax credits, grants, and loans to various industries and small businesses across New York. These proposed programs range from manufacturing tax incentives to agricultural workforce credits, with fiscal impacts for individual initiatives reaching as high as $275 million.
Key Data
$140 Million
— Fiscal impact of the proposed zero-percent Corporate Franchise Tax for manufacturers.
$30 Million
— Fiscal impact of the Farm Workforce Retention Credit.
$275 Million
— Fiscal impact of making real property owned by small businesses eligible for the STAR property tax exemption.
$10 Million
— Fiscal impact of the GrowNY pilot program for economic gardening.
$8.25 Million
— Fiscal impact of the Capital Investment Jobs Retention Program.
$100 Million
— Fiscal impact of the tax credit for music and video game production.
5 is the number of years Alicia Glen was the Deputy Mayor for Housing and Economic Development under Mayor Bill de Blasio. She joins the podcast to reflect on her tenure as Deputy Mayor, the state of the city in 2014, where it stands now, and where it should be…
25,000 is the number of jobs that would have been created under a now-defunct deal with Amazon to create a second headquarters in Long Island City, Queens. Vishaan Chakrabarti, founder of the Practice for Architecture and Urbanism (PAU), discusses the deal and how its failure may impact New York City's…
New York's spending on state and local economic development programs rose to $9.9 billion in 2018, a 17 percent increase from 2016, driven by significant investments in projects like the Moynihan Station and the Life Sciences Initiative. To improve accountability and transparency, the state should codify procurement reforms and establish a unified budget with standardized metrics to better evaluate program results.
Recommendations related to Major Economic Development Projects
The state should codify the gubernatorial proposals for a "database of deals" and procurement reform into law to ensure they have the strength of law.
New York should establish a forward-looking unified economic development budget that includes information on the costs of all economic development programs for the coming fiscal year.
The state must implement standardized metrics across programs to allow for the comparability of results.
The state should pursue program design improvements so that benefits follow private sector investment, eligibility is standardized, and results are evaluated regularly.
Key Data
$9.9 billion
— Total state and local economic development costs in 2018.
$8.5 billion
— Total state and local economic development costs in 2016.
$1.2 billion
— Spending by the Empire State Development Corporation in 2018.
$700 million
— Appropriation for the construction of Moynihan Station in Manhattan.
$400 million
— Appropriation for the second phase of investment in the Buffalo Billion.
$1.1 billion
— Appropriation for the Life Sciences Initiative and new laboratory.
The Amazon headquarters deal in Long Island City highlights significant flaws in economic development policy, including the use of discretionary grants and tax breaks that exceed established legislative caps. Future economic development strategies should prioritize general infrastructure investment over direct corporate subsidies and ensure tax expenditures are strictly targeted to induce job creation that would not otherwise occur.
Recommendations related to Major Economic Development Projects
The Legislature should closely scrutinize an increase in the cap for the Excelsior Jobs Program.
A cap to the level of wages eligible for the Excelsior credit should be considered.
State capital funding is best invested in general infrastructure, not for the direct benefit of an individual company.
City tax expenditure programs should be narrowed or eliminated to ensure benefits are only spent to induce job creation that would not otherwise occur.
Capital investment should go through the regular budgetary process.
Key Data
$2.5 billion
— Amazon's announced investment for the construction of headquarters in Long Island City.
25,000
— Number of new full-time jobs Amazon committed to creating over 10 years.
$150,000
— Average salary for the new jobs created by Amazon.
$2.8 billion
— Total combined tax breaks and grants offered by New York State and New York City.
$3.5 billion
— Potential combined state and city incentives if Amazon creates 40,000 jobs and 8 million square feet of office space.
The Amazon HQ2 project in Long Island City involves a massive incentive package totaling between $2.8 billion and $3.5 billion in state and city tax benefits to support the creation of 25,000 to 40,000 jobs. While the project aims to diversify the local economy, the deal highlights significant concerns regarding the expansion of tax programs for individual companies and the need for better oversight of economic development incentives.
Recommendations related to Major Economic Development Projects
The Excelsior Job Program should not be expanded to accommodate the needs of a single company, as this sets a concerning precedent.
Caps to the level of wages eligible for reimbursement should be implemented to minimize the State’s financial exposure.
State capital funding should be invested in general infrastructure, rather than for the direct benefit of an individual company.
Amazon should pay the full value of the PILOT directly to the City rather than diverting some funds to the surrounding neighborhood.
New York City’s as-of-right tax incentives should be reconsidered, evaluated, and potentially narrowed or eliminated to ensure benefits are only spent to induce job creation that would not otherwise occur.
Key Data
$2.5 billion
— The amount Amazon committed to investing in the Long Island City project.
25,000
— The number of full-time high-paying jobs Amazon committed to creating over ten years.
$2.8 billion
— The total value of benefits available to Amazon from New York State and City if 25,000 jobs are created.
$3.5 billion
— The total value of benefits available to Amazon from New York State and City if 40,000 jobs are created.
$1.2 billion
— The maximum amount of Excelsior tax credits Amazon could receive over the 2019-2028 period.
$505 million
— The maximum total of the Empire State Development capital grant.
Watch the original segment here . Progressive, first, best are all terms have been used to describe New York’s economy. One non-partisan watchdog group took a look at how responsible the state has been with its money since Andrew Cuomo took office eight years ago. "See what has actually changed…
New York City's economic development efforts, managed by the EDC, cost $3.2 billion annually and require reforms to improve transparency, standardize tax benefits, and focus capital investments on neighborhood infrastructure rather than individual firms. By prioritizing conduit financing for cultural, educational, and health sectors and narrowing the EDC's mandate to job creation, the city can better support sustainable economic growth.
Recommendations related to Major Economic Development Projects
Establish more detailed standards for awarding discretionary tax expenditures.
Improve transparency and reporting on EDC projects.
Make capital investments in infrastructure to support job growth in underdeveloped neighborhoods.
Use conduit financing to support growth in the arts, health, and educational sectors.
Keep the EDC's focus on job creation to ensure economic development efforts remain effective.
Key Data
$3.2 billion
— Annual cost of the City's economic development efforts in 2016.
$548 million
— Value of discretionary tax benefits awarded by the City in 2016.
87 percent
— Portion of conduit debt issued for cultural, educational, and health sectors since 2016.
$30,000
— Threshold for benefits per job created, which most projects received less than.
New York State spends over $4 billion annually on economic development initiatives, often funding large-scale projects without clear criteria or unified budgeting, resulting in high costs per job created. To improve accountability and return on investment, the state should implement standardized metrics, transparent reporting, and performance-based incentives for all economic development programs.
Recommendations related to Major Economic Development Projects
The state should establish a unified economic development budget to provide a clear overview of annual spending.
Policymakers must standardize metrics across all economic development initiatives to allow for accurate comparisons between programs.
The state should establish a database of deals outlining every economic development incentive to ensure transparency regarding beneficiaries and commitments.
Officials should improve program design so that incentives are only provided after an employer has fulfilled its promises to protect taxpayer funds.
The state must adopt administrative reforms to ensure procurement integrity within its economic development processes.
Key Data
$4 billion
— New York state allocates more than this amount annually to economic development.
$1 billion
— Amount of taxpayer money allocated to 'silver-bullet' projects before a single new job was created.
$83 million
— Amount invested by the state in a factory for an LED light company in DeWitt that failed.
$15 million
— Additional cost to taxpayers to properly equip the factory building for a new tenant.
$337,931
— Amount New York will have spent per job for the new company in DeWitt.
$30,000
— Annual subsidy per job per year for the new company in DeWitt, assuming the jobs last for 10 years.
$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 spent $3.2 billion on economic development efforts in 2016, yet the city must still implement stricter standards for discretionary tax benefits and ensure that conduit financing is used effectively to support key sectors. While some progress has been made on previous recommendations, the city needs to improve the cost-effectiveness of tax expenditures and better manage economic development programs to ensure investments are sound.
Recommendations related to Major Economic Development Projects
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.
$55 million
— The first New Markets Tax Credits allocation received by the New York City Neighborhood Capital Corporation in 2016.
$590,269
— The high end of the per-job subsidy range for projects granted discretionary benefits initiated in fiscal years 2015 and 2016.
90%
— The share of conduit debt issued to educational, arts, and health sectors since 2014.
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.
Tax increment financing is a widely used economic development tool that captures future property tax revenue to fund infrastructure, but it carries significant risks if not properly vetted. Successful implementation requires rigorous due diligence, including testing whether projects would occur without public support and ensuring they generate net new economic growth rather than shifting existing activity.
Recommendations related to Major Economic Development Projects
Governments should ensure that a proposed project passes the 'but for' test to confirm that development would not occur without the TIF-funded capital improvements.
Policymakers must determine whether an investment will generate new economic activity or simply shift it from elsewhere, as retail TIFs often fail to produce net gains.
Cities should evaluate whether a project's expected return on investment is strong enough to justify diverting revenue from other prospective needs.
Municipalities must assess whether a district will generate sufficient revenue to repay debt service and establish a plan for covering potential shortfalls.
Governments should consider whether general obligation bonds are a better option than TIF bonds, which are riskier and more costly due to their reliance on future, unrealized revenue.
Key Data
$3 billion
— Projected cost of the Hudson Yards project based on planning studies.
138-acre
— Size of the contaminated industrial property remediated for the Atlantic Station TIF project in Atlanta.
$10 million
— Amount raised and spent by a majority of Chicago's TIF districts over a 13-year period.
$3 billion
— Maximum amount of bonds for the Hudson Yards project that New York City agreed to guarantee.
$359 million
— Amount New York City paid from its general fund to subsidize Hudson Yards' interest payments.
$266 million
— Capital cost overruns incurred by the Hudson Yards project.
This week's data point is $780 million - the value of contracts involved in the alleged bid-rigging and corruption scandal involving State economic development programs. Special guest New York State Comptroller Tom Dinapoli discusses his proposal for independent review and reform of state procurement practices with Ben Max and Maria…
Economic development programs should be evaluated using a standardized set of metrics, including project identification, incentive details, and job creation or retention commitments. Tracking these specific data points ensures transparency and accountability for all capital investments and qualified investments made through these initiatives.
Recommendations related to Major Economic Development Projects
Economic development programs should track general information including project identification numbers, applicant names, and site addresses.
Agencies should report incentives issued, including grants, loans, and tax credits, with annual breakouts.
Programs should monitor job creation and retention commitments, including full-time equivalent and temporary jobs.
Agencies should report actual jobs and capital investments annually after an incentive begins.
New York state spends $8.6 billion annually on economic development initiatives, yet lacks a unified budget, clear metrics, or accountability for discretionary grants. The state should halt project-specific appropriations until it establishes rigorous eligibility criteria and performance-based payment structures to ensure taxpayer funds are protected.
Recommendations related to Major Economic Development Projects
More robust reporting requirements are needed for Regional Economic Development Councils.
The state should pay for performance, providing subsidies only for investments and wages that have been expended.
The state should stop project-specific appropriations for economic development until eligibility criteria are established and accountability mechanisms enhanced.
Key Data
$8.6 billion
— Total annual state economic development investments.
$4 billion
— State portion of annual economic development investments.
$4.6 billion
— Local portion of annual economic development investments.
$486 million
— Cost of the SolarCity plant in Buffalo.
$638 million
— Cost of the Nano Utica project.
$125 million
— Cost of the Norsk Titanium plant at SUNY Polytechnic Institute.
New York State's economic development strategy relies heavily on programs like START-UP NY and the Excelsior Jobs Program, which often lack sufficient oversight and transparency. Furthermore, the state frequently allocates substantial funding to ad hoc, project-specific developments that bypass established eligibility criteria and accountability measures, creating significant financial risk for taxpayers.
Recommendations related to Major Economic Development Projects
For START-UP NY, total wages paid and the number of employees should be reported to provide a clearer picture of who benefits from the program.
The personal income tax benefit in START-UP NY should be converted into a business tax credit based on wages paid.
Recently added industries, notably music and entertainment, should be excluded from the Excelsior Jobs Program as they do not require state assistance to be economically viable.
All economic development programs should follow the Excelsior model of pay-for-performance to ensure subsidies are provided only for investments and wages actually expended.
The State should cease project-specific appropriations for economic development until eligibility criteria are established and accountability mechanisms are enhanced.
Key Data
$1 Billion
— Cost to build a factory in Buffalo for SolarCity.
$20,000
— Cost per job per year for the SolarCity project in a best case scenario.
$638 Million
— Funding for the Nano Utica project.
$486 Million
— Funding for the SolarCity plant.
$125 Million
— Funding for the Norsk Titanium plant at SUNY Polytechnic Institute.
$560,000
— Tax incentives received by the Muller Quaker factory through the Excelsior Jobs program.
Tony Guida sits down with the CBC's Vice President, Maria Doulis, to discuss why New York City's mega-projects run over budget and how the public sector can build better.
The Port Authority's Brooklyn and Red Hook maritime facilities, which currently lose millions annually, should be repurposed to create housing, commercial space, and community amenities. Converting these 105 acres could generate thousands of new housing units and jobs while eliminating unnecessary financial deficits.
Recommendations related to Major Economic Development Projects
The Port Authority should repurpose the Brooklyn and Red Hook facilities to reduce losses and spending.
The city should engage the community in envisioning how the property could best be used for housing, commercial space, schools, and parks.
The Port Authority should rethink the use of its most underused and obsolete maritime facilities given their history of running deficits.
The site should be developed to yield between 3,800 and 7,600 housing units to enhance the community.
The site should be developed to support over 2,500 jobs through commercial use, which is more than three times the number of direct jobs currently supported.
Key Data
$82 million
— The amount of money the Port Authority of New York and New Jersey lost in 2013.
$29 million
— The amount of money the Port Authority would save annually by 2029 if the facilities were repurposed.
175 percent
— The increase in vacant land in Community Board 6 if the 105 acres were made available for development.
3,800 and 7,600
— The range of potential housing units the site could yield if developed.
2,500
— The number of jobs the site could yield, which is more than three times the number of direct jobs currently supported.
5 percent
— The portion of total port acreage that the two facilities make up.
New York City's economic development programs, including tax expenditures, capital spending, and conduit financing, have grown significantly in scale but require improved management, transparency, and cost-effectiveness. Future administrations should prioritize infrastructure investments in areas with growth potential and establish clearer standards for awarding discretionary benefits to ensure these tools effectively foster job creation.
Recommendations related to Major Economic Development Projects
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
$9.2 billion
— Total face value of conduit financing for 226 projects completed between fiscal years 2002 and 2012.
$751 million
— Annual capital spending on economic development in fiscal year 2012.
$1.6 billion
— Annual tax expenditures for economic development in fiscal year 2012.
$368 million
— Relevant operating expenditures for economic development in fiscal year 2012.
$3.0 billion
— Total expected local investment for the Hudson Yards development project.
$238 million
— Annual cost of discretionary tax expenditure benefits.
New York City's economic development reporting often fails to capture the full scope of costs associated with incentive packages, such as the $125 million FreshDirect deal, by excluding state assistance and capital commitments from cost-benefit analyses. Improving transparency by including debt service for capital projects and convening the mandated methodology recommendation committee would enhance accountability and ensure government-funded benefits are justified.
Recommendations related to Major Economic Development Projects
The Economic Development Corporation should include the debt service associated with project-related capital commitments in its cost-benefit analysis, similar to how it treats PILOTs and tax exemptions.
The methodology recommendation committee, created under Local Law 48, should be appointed and convened to discuss necessary adjustments to reporting measures and cost-benefit analysis methodologies.
Key Data
$125 million
— Total incentive package provided to FreshDirect for its relocation and expansion into the Harlem River Yards.
$1.4 billion
— Total assistance provided to more than 620 development projects over their lifespans as of the 2011 report.
$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 by the Economic Development Corporation through 2011.
$33.9 million
— Amount of state benefits, such as sales tax and mortgage recording tax exemptions, excluded from the FreshDirect cost-benefit analysis.
90,000
— Number of new full-time equivalent jobs created at projects receiving assistance according to the Economic Development Corporation.
New York City is investing up to $100 million in land and infrastructure to establish an applied science and engineering campus, aiming to address the region's shortage of engineering talent compared to peers like San Jose. While the city currently has approximately 129,000 engineers, it ranks near the bottom of large metro areas in the share of its population employed in engineering, a trend that the new campus is intended to help reverse.
Recommendations related to Major Economic Development Projects
An applied science and engineering campus would be a positive first step in reversing the trend of losing highly-skilled engineering professionals.
Key Data
$100 million
— The City of New York's investment in land and infrastructure for the selected university to develop an applied science and engineering campus.
129,000
— The approximate number of engineers in the New York City metropolitan area according to the 2008-2010 American Community Survey.
.7%
— The share of the New York City metropolitan area population that cites an occupation as an engineer.
3.1%
— The share of the San Jose metropolitan area population that cites an occupation as an engineer.
450,000
— The number of additional engineers the New York City metropolitan area would need to surpass the share of engineers in the San Jose metropolitan area.
New York City's capital planning process requires significant reform to better align spending with long-term infrastructure needs and to ensure that major expansion projects are justified by rigorous economic analysis. The current system often relies on borrowing for routine maintenance and lacks clear, data-driven rationales for large-scale investments, necessitating a more strategic approach to capital budgeting.
Recommendations related to Major Economic Development Projects
The City should expand and institutionalize the PlaNYC approach to ensure long-term strategic planning for infrastructure and major projects.
The City should develop a systematic plan for bringing all City-owned assets to a state of good repair to prioritize maintenance over new expansion.
The City should place capital assets on appropriate replacement cycles and fund their replacement with operating revenues rather than relying on debt for routine maintenance.
The City should pursue expansion projects based on clearly explained priorities and data demonstrating benefits that will accrue to the public.
Key Data
$83.7 billion
— Total capital investments called for in the Ten-Year Capital Strategy over the next ten years.
$24 billion
— Total value of new capital expansion projects to be pursued by the City in the next ten years.
$3.0 billion
— Investment in the Hudson Yards project, which is the only one of the $24 billion in new capital investments clearly justified on the basis of anticipated economic benefits.
$5.4 billion
— Estimated funding required to achieve a state of good repair for assets covered by the Asset Information Management System report for fiscal year 2008.
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