School districts and labor unions would be represented on IDA boards under bipartisan bill passed by state lawmakers

An IDA reform measure passed both chambers of the State Legislature in the closing days of the legislative session was welcome news to Riverhead Central School District officials.

Assembly Member Jodi Giglio, who voted in support of the bill, attended last night’s school board meeting to announce its passage. The bill mandates the appointment of a representative of the school district and a representative of a labor union to the boards of directors of industrial development agencies in the State of New York.

The bill, sponsored by Assembly Member Michaelle Solages (D-Elmont), who represents the 22nd Assembly District, makes mandatory the appointment of a school superintendent or their representative, or alternatively, a school board member, as well as a representative of a labor union, to every industrial development agency in New York State. 

“School districts and union members have often had limited representation in the IDA decision-making process, leading to the perception that economic development efforts do not consider the needs of the entire community,” Solage said in a statement emailed to RiverheadLOCAL this afternoon. 

“Adding school board members to IDA boards guarantees tax abatements take into account local schools’ financial obligations while empowering labor to advocate for quality job opportunities,” she said. 

“This bill fosters inclusive economic development that prioritizes equity, and I encourage the Governor to sign this legislation into law,” Solages said.

Her bill passed the Assembly by a vote of 128-19 on May 29 and companion legislation, sponsored by 37th Senate District Sen. Shelley Mayer (D- Yonkers),  passed the State Senate by a  vote of 51-10 on June 4. 

Assembly Member Fred Thiele (D-Sag Harbor) and State Senator Anthony Palumbo (R-New Suffolk) both voted in favor of the measure.

Giglio said last night she expects the governor will sign the bill into law.

Under existing state law, IDA boards can have no more than seven members. Where an IDA board already has seven members, the board will be temporarily expanded by the two new mandatory appointments and the IDA members whose terms expire after the mandatory appointments are made will be forced to leave the IDA board.

The Riverhead IDA board has only five members, so appointment of the two mandated members will not affect any director whose term may expire after the two mandatory members are appointed.

The governing body of the municipality — in Riverhead, the Town Board — retains the right to appoint members of the IDA board. It will also appoint the two new mandatory members.

Riverhead Central School District representatives have been asking to have a “seat at the table” when the Riverhead IDA reviews applications for financial benefits that include school district real property tax abatements. 

Net school property tax exemptions granted by the Riverhead IDA in 2022 totaled nearly $2.7 million. 

Statewide, school districts lost at least $1.8 billion to corporate tax exemptions in fiscal year 2021, according to the Washington, D.C.-based watchdog organization Good Jobs First. The nonprofit organization issued a policy report in February recommending that New York State eliminate IDAs “for their lack of accountability” — or at least prohibit IDAs from exempting school property taxes.

MORE COVERAGE: Teachers, school district officials and state lawmakers take a stand against IDA school tax exemptions

A bill introduced in the State Legislature in each of the last two sessions would have prohibited IDAs from exempting school property taxes. The bill twice died in committee in both chambers of the legislature — meaning the Assembly and Senate committees to which the bills were referred never acted on them, so the measures never made it to the full chamber for a floor vote. The powerful New York State United Teachers, the state’s largest teacher’s union, advocated for the measure to no avail. 

Riverhead Central Faculty Association President Gregory Wallace went to Albany to rally for and advocate for passage of the bill that would have prohibited IDAs from exempting school property taxes. He said today he was disappointed that legislation again stalled in committee. Wallace said he was happy to hear about the other IDA reform measure passing in both chambers. 

“It’s certainly a step in the right direction,” he said.

MORE COVERAGE: Riverhead teachers union speaks out at Albany rally for bills to ban IDA school tax exemptions

That sentiment was echoed by Riverhead Board of Education President Colin Palmer.  However, he said, he is “not entirely confident that it’s going to lead to that much change,” because the school district and union representatives will be a minority of two. 

“It’s a step in the right direction,” Palmer said. But work remains to be done in the next session, he said.  “Other bills that will further reform are just too important to forget about,” Palmer said.

Riverhead IDA Executive Director Tracy Stark-James did not return a phone call today seeking comment for this story.