Independence at Binghamton-area IDA comes with cost to oversight

PHOTO: Matt Richmond, WSKG

Matt Richmond, BINGHAMTON

The Broome County Industrial Development Agency is largely controlled by one man. That means there’s little oversight of a powerful agency that controls a multi-million dollar portfolio of properties.

Richard D'Attilio is the executive director of the Broome County IDA. Any project awarded tax breaks by the IDA comes across his desk. And any project that is rejected comes across his desk too.

D'Attilio started with the agency 18 years ago, turning it into, basically, a developer that gives away tax breaks.

"We are revenue-driven, we are independent and autonomous from the county, the government. Once the board of directors has been put in place, they are the final word on all activity."

That means only the board of directors has a say in how the IDA spends money. But it's not clear that the board actually gets involved in any meaningful way. A review of more than a year of board meeting minutes found no projects that were rejected by the board after getting the ok from D'Attilio.

One former board member, who declined to speak on tape for fear of political retribution, says everything the IDA does comes from D'Attilio. The board doesn't get involved in which projects are chosen.

D'Attilio says the IDA has a long history of operating independently.

"Since 1970, we're probably just about anywhere you might see industrial growth and development and it's a fairly long list of projects."

The IDA is a powerful organization. It gave away $66.7 million between 2006 and 2010. But D'Attilio says making those deals is important for Broome County's economy.

"One thing, to make a point here, we do not take and I believe this very firmly - we do not take taxes away from any community in any deal that we do. It's all new money."

That new money comes in payments made to the IDA known as PILOTS, or payment in lieu of taxes. The PILOTS go to local governments and schools instead of regular property taxes. Over time, usually about 15 years, the company steps up its payments to the full tax rate.

That's the main value an IDA can offer - relief from property taxes. But the IDA also profits from the deals.

D'Attilio says the agency has grown its revenues and built up a surplus of millions because they've taken over old industrial sites and redeveloping them. 

"We've been successful because we took a few risks over the years, risks that weren't necessarily taken because we wanted to get into the real estate business."

Because D'Attilio has so much control over the IDA, he's able to take those risks. But on the other hand he claims his decisions are largely dictated by state law.

"So if a company qualifies, it's pretty much, everybody is treated the same way. So it's not like we can arbitrarily pick and choose who based upon any criteria in terms of needs."

That argument for the projects chosen doesn't make much sense to Tompkins County IDA board member Jeff Furman.

"If there's a checklist, an automatic checklist, I understand that gives people more security, it's easier to know and you don't have to deal with procedural stuff, but why have an IDA board at all?"

According to Furman, an IDA board should take a more active role in shaping the kinds of businesses that come into an area than Broome County's IDA board does.

Jason Garnar, a former chairman of the legislature's economic development committee, says he's advocated for reforms that would strengthen the board.

"Unfortunately, the county doesn't directly control the IDA."

Garnar says he pushed the board to require companies to return money if they don't create the promised number of jobs, to mandate local labor for all projects and to ensure that the jobs created are better than minimum wage. Garnar says no action was taken.

"I think some of the IDA members were worried that if we put too many requirements upon companies that they'd just go someplace else that didn't have those types of requirements."

And that's the main argument that has kept the Broome County IDA so independent. In our next story on IDAs, Ryan Delaney will explore what happens when a county legislature takes the reins.