Last week, state Comptroller Tom DiNapoli released an audit of the state’s Excelsior Job’s Program. The audit found that the state has been unable to verify that many companies receiving these benefits have met their job creation obligations.
The Excelsior Jobs Program was established in 2010; it provides refundable tax credits to businesses in targeted industries in exchange for creating and maintaining specific numbers of new jobs or making significant capital investments. Empire State Development, which administers the program, requires companies to report annually to verify their job creation and investment totals.
Auditors identified a number of problems, ranging from reducing job creation goals after companies did not meet expectations to not verifying if jobs were full-time or part-time.
Comptroller DiNapoli said:
“New York state gives away millions of dollars each year in tax breaks for companies that are supposed to create jobs and expand under the Excelsior program, but ESD’s oversight leaves a lot to be desired. ESD needs to stop lowering the bar and giving companies a pass when they fall short of promises. ESD needs to ensure these businesses are not taking advantage of state taxpayers.”
ESD disagreed with the audit’s findings, and issued the following statement:
“Any truly objective review would show this program is cost-effective, performance-based, and incentivizes business growth by only providing tax credits to those that have achieved their job commitments and investments. The reporting requirements to this agency, as well as to the Department of Labor, are rigorous and companies have to demonstrate to ESD that they met their job commitments before any credits are issued. To be clear: auditors did not find a single instance where incentives were improperly provided. They also apparently ignored the success of this program, which, to date has admitted 434 businesses that have committed to create more than 44,445 new jobs, retain nearly 158,000 existing jobs and invest $4.2 billion.”