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State audit of Syracuse Industrial Development Agency produces list of concerns

Tom Magnarelli
The Syracuse and Onondaga County industrial development agencies.

Last month, the state comptroller’s office released the results of an audit of the Syracuse Industrial Development Agency with a list of recommendations to improve how it operates. Agency members are disputing some of those recommendations.

The audit said that board members and agency officials do not compare the number of jobs estimated on a project with the actual amount created. The Syracuse Industrial Development Agency's executive director Ben Walsh disagrees.

“One thing that we want to make very clear is that we absolutely collect and track that information,” Walsh said.

He said the state comptroller's office wants more verification of that information through payrolls or affidavits. 

The audit looked at nine projects, two of which did not submit annual job reports. Three projects created more jobs than anticipated but four did not. However, Walsh pointed out that overall; more jobs were created than estimated.

“The primary mission of the IDA, which is to create jobs and economic opportunity in the city, based on what we saw come out of the audit and what we see with the projects we work with every day, we feel like we’re fulfilling that mission,” Walsh said. "There are some good recommendations in the audit, certain policies that may be able to be strengthened, ways in which we can more clearly articulate our priorities.  But we feel good about the processes we have in place now and the procedures. But we feel we can always do better."

The audit said businesses could be receiving benefits from the agency without meeting their goals. It finds that there are no clear rules on how those benefits could be rescinded. Auditors found the guidelines board members say they use in awarding tax exemptions are not official policy requirements, which could cause inconsistencies. The agency also owes the city of Syracuse $2 million. Walsh says they are in talks with the city about resolving that issue.

Walsh said one way they can improve is by determining additional community benefits that can be obtained from the projects.

"How we can do a better job of clearly articulating those benefits at the front end of the project and ultimately ensuring that we receive them at the end of the project," Walsh said.

But the city’s development agency is not the only one in Syracuse. Walsh said recently the Onondaga County Industrial Development Agency has shown it is willing to support projects if developers would rather avoid the city agency all together. When that happened with the Inner Harbor project, it prompted the city to file a lawsuit.

“We do have concerns that that sends mixed messages to the development and business community,” Walsh said.

The county agency also voted to provide assistance to a proposed student housing project in the city.

Tom Magnarelli is a reporter covering the central New York and Syracuse area. He joined WRVO as a freelance reporter in 2012 while a student at Syracuse University and was hired full time in 2015. He has reported extensively on politics, education, arts and culture and other issues around central New York.