WITHOUT ENOUGH VOTES, COUNCIL PUNTS'TIL SATURDAY

Unable to secure the five votes necessary to push through questionable changes to the City's Empire Zone map last night, Council President Lesnick refused to allow a vote and adjourned the Special Council meeting he had called. The new meeting is now expected to be called for Saturday morning at 9 a.m. By adjourning until Saturday, Lesnick now needs only four votes under a Rule which provided that the five votes were necessary because the Council had the Legislation for less than eight days.

Mr. Lesnick cited "unanswered questions" as the reason for the adjournment. However, the one central question, how does the Cross County Shopping Center reasonably fit the criteria for Empire Zone benefits, still won't be answered by Saturday because it can't be.

At the hastily called Real Estate Committee meeting Tuesday night, Councilmembers spent at least an hour and one half trying to get the answer to that question from someone, the owner, the administration, anyone. Nobody had a straight answer. When asked why the shopping center should be in the Zone, all present numbly and repeatedly recited the litany of tax breaks and credits that the owner would receive as a result of Empire Zone designation. But the tax breaks are not the purpose of the Empire Zone...they are the means. The purpose is to attract or retain businesses in depressed and marginal neighborhoods where they either would not otherwise locate or might choose to leave. Cross County, a successful economic engine even before its present rehabilitation plan isn't planning to go anywhere.

There is simply no good reason to give it these tax breaks. New York State taxes, the highest in the nation, are a zero sum game. If Cross County gets a tax break, overall taxation in New York doesn't change. Someone else, another business or perhaps every New York homeowner just ends up paying the difference.

COUNCIL BEING ASKED TO RUSH THROUGH EMPIRE ZONE CHANGES

In an e-mail sent late Wednesday, the City Council President informed the members of the Council for the first time that the Administration and the Economic Development Office were requesting Council action to change the City's Empire Zone map. The Empire Zone is a state program designed to create tax breaks and other incentives in order to attract new businesses to or to retain existing businesses in economically depressed areas of the City.

The Empire Zone program statewide has long been the subject of criticism for lax oversight and the failure to deliver the jobs and economic benefits promised.

In the present case, the proposal is, apparently, to take a portion of the "Ridge Hill" property, previously awarded an Empire Zone designation, out of the Empire Zone and then, in effect, reassign that amount of "Zone" to the Cross County shopping center and a portion of the SFC development. Of course, this is all conjecture since, as of this writing on Sunday night, the members of the Council have seen no specifics as to what is being proposed and what they are being asked to vote on. Of course, neither has the public. Nevertheless, the Administration and the Council President are asking that we vot on these changes on Wednesday night. So much for due diligence.

Meantime, even if we had seen the proposal already, the whole proposal begs the question how the Cross County shopping center qualifies for the program. It would certainly come as a surprise to its neighbors that they are in an economically depressed area with a high rate of poverty. To the contrary, the shopping center has been a money engine since it opened. Yes, it is getting a much needed upgrade, but economically depressed it isn't. Certainly, we are not in danger of it "leaving" the state.

Indeed, a telling Press Release, which may answer the question "why the rush?" was released on December 16, 2008 by Governor Patterson. In it he outlines his proposed reforms to the Empire Zone program. Among other things it states:

"Certain industry sectors such as utilities, retail and real estate, which are engaged in activities that make them unlikely to relocate outside of the state, would also be excluded from applying for [Empire Zone] certification in the future".

Retail? Real Estate? In other words, if the developer doesn't get the City Council to give him his tax breaks now, the proposed reforms may mean he never gets them in the future.

That appears to be what this is really all about.

Council to review Comptroller's audit of Yonkers IDA

The NYS Comptroller recently issued his report of his audit of the Yonkers Industrial Development Agency. The City Council Municipal Operations Committee is planning a meeting to review the report. The time, date and location will be announced shortly. Meantime, the Comptroller's report and the City's response can be found here:

http://www.osc.state.ny.us/localgov/audits/others/2009/yonkersida.pdf

STATE LEADERS AVOID RESPONSIBLE DECISION MAKING

Governor Patterson held a press conference today to announce that, thanks to federal stimulus money, he was canceling proposed taxes on everything from soda to bowling to haircuts. Notice anything? Apparently the Governor (and the Senate and Assembly leaders who stood with him) think there are only two choices: federal aid or higher taxes. The third and best option – budget cuts – is apparently not even a consideration. Thus our Albany leadership is falling into exactly the trap many who questioned the size and scope of the Stimulus warned against. Instead of finally making the responsible decisions they have avoided for so long, our state leaders are just using the Stimulus money to delay the inevitable. Next year or the year after, the hole will be deeper and, barring a dramatic economic turnaround, the tax hikes will be even steeper.