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Renee A. Filip: How the Erie County Legislature failed taxpayers

Published:August 9, 2009, 8:46 AM

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Updated: August 21, 2010, 1:13 AM

We seldom find a clearer example of special interests’ hold on government than in the July 24 Erie County Legislature debacle. Eleven of 14 legislators voted to add costly labor-backed amendments to a proposal by the county executive that would have helped not-for-profits advance expansion projects, create jobs and take advantage of federal stimulus funding.

They did so not only to the detriment of not-for-profit organizations and Erie County’s work force, but with a clear misunderstanding of the issue.

Elected officials voting on issues they are unfamiliar with is nothing new in New York. In this case, however, not only was the debate on the floor misrepresentative, so was the legislators’ language in the amendments they passed that spoke of “tax breaks” for not-for-profits.

Much of their argument centered on these “tax breaks” as justification for imposing a labor-backed prevailing wage mandate. Unfortunately for Erie County’s working men and women, that justification is inaccurate.

The county executive’s proposal simply allowed not-for-profits to tap into the county’s borrowing power to get financing at a 10 percent to 15 percent savings. There never were any tax breaks involved.

Regardless of the facts—and despite being made aware of the misrepresentations actually printed in their amendments for public record—11 Erie County legislators went ahead and used this justification to force a prevailing wage requirement on any not-for-profits that would take part in the financing program. Which, of course, renders the program useless.

If you’ve ever done fundraising for a not-for-profit, you will appreciate that a 10 percent to 15 percent savings can determine whether a project moves forward or not. Since prevailing wage, according to a Center for Governmental Research report in January 2007, adds 28 percent to construction costs on a project upstate, those savings are not only nullified, the project would cost even more under prevailing wage than if the not-for-profit did the financing on its own.

The bottom line is that the legislators stifled these projects when they had a great opportunity before them. What does this mean for their constituents? It means jobs on $150 million to $200 million worth of projects — and others that would likely emerge were a viable program in place — will not become available for Erie County residents. It means not-for-profits strapped for cash will have a more difficult time expanding to better serve the community. It means federal stimulus money available for these types of projects will be lost and swept up by other states.

While legislators were overwhelmingly self-congratulatory from the floor of the Legislature, in truth they failed Erie County taxpayers looking for jobs and economic development.

Renee A. Filip is senior director of business development for the Buffalo Niagara Partnership.

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