County IDA Responds to Stricter Oversight Proposed by Sen. Skoufis

The office building that houses the Orange County Industrial Development Agency in New Windsor, N.Y., on Feb. 22, 2023. (Cara Ding/The Epoch Times)

The head of Orange County’s Industrial Development Agency (IDA) says the agency is already under sufficient state oversight and needs no more from New York state Sen. James Skoufis.

Bill Fioravanti, the agency’s CEO, said it already reports to the New York State Authorities Budget Office and Comptroller’s Office and operates within the general municipal law.

“We are under strict oversight and monitoring already,” he told The Epoch Times. “These agencies have had no issue with how we operate the IDA nor any projects we have incentivized.”

IDAs are public benefit corporations empowered by state law to use tax incentives to spur economic development and job growth.

On Jan. 13, Skoufis advanced an oversight measure into the Senate’s version of the state budget, which would create the position of a monitor with powers to reject deals approved by the county IDA.

Skoufis represents New York’s 42nd District, which covers most of Orange County, and chairs the state Senate’s Committee on Investigations and Government Operations. As a state senator, he has been vocal about what he calls years of bad deals out of the development agency, which he often equates to corporate welfare at the cost of local tax dollars.

Last month, he opened an investigation into the county IDA over the $3 million in tax incentives granted to a longtime Goshen-based food manufacturer. He called it the “worst deal” ever by the county agency at a news conference, given that the applicant said the project would happen regardless of the incentives, although at a slower pace.

Fioravanti says tax incentives approved by the agency follow industry-standard cost-benefit analysis, with a focus on industries that the county seeks to attract, such as food and beverage makers.

Plus, IDA incentives shouldn’t be viewed in isolation but against the backdrop of the unfavorable business environment in the state of New York, he added.

“We are looking for Sen. Skoufis and the state government to make New York more competitive for businesses,” Fioravanti said. “If he can bring those conditions about, we’d gladly close up shop and focus our energies elsewhere.”

Up for Review

Fioravanti concedes that the agency isn’t perfect, and says he looks forward to a review and revision of the agency’s uniform tax exemption policy in the summer, which lays out directives and rules governing the tax incentives’ approval.

The policy was last updated in June 2019.

Run by a seven-member, all-volunteer board, the county IDA gets its entire operating money from application fees; taxpayers can voice opinions on projects through public hearing sessions.

Since Fioravanti came on board about two years ago, the county IDA hasn’t rejected a single application from businesses, he told The Epoch Times.

Three tax incentives commonly sought are sales tax exemptions, mortgage recording tax exemptions, and real property tax abatements. He added that’s because businesses that applied had already self-qualified based on agency policy.

Skoufis Responds

“The fact that Mr. Fioravanti freely admits the agency hasn’t denied a single application for tax incentives should raise eyebrows,” Skoufis said in a statement to The Epoch Times. “Why should taxpayers trust the IDA to be a responsible gatekeeper when Mr. Fioravanti throws the gates wide open?

“That admission itself justifies the need for additional state oversight,” he said, adding that the current oversight structure doesn’t allow for evaluations of the merits of IDA decisions.

The oversight measure introduced by Skoufis is part of the state Senate’s one-house budget, which still needs to be negotiated with the state assembly and Gov. Kathy Hochul.

A state budget is due by April 1.

In the past, Skoufis has successfully secured funding in the budget for an audit of IDAs statewide that’s underway and will likely conclude this year.

In 2021, three former county IDA officials pleaded guilty to corruption charges over using their public posts to benefit private companies in which they had a personal interest. They were ordered to pay a combined amount of more than $1 million in restitution.