More secrecy

J ust how successful is New York's Economic Development Zone program? For years, that question hs,+20

has been raised by critics - this page included - who have claimed the large tax breaks given to some companies could not be justified by the number of new jobs they created. And for years, there was no way to know for sure because the state would not release the data to show where the dollars went.

The secrecy was indefensible. The program's incentives are paid for by taxpayers, and should be readily available to the public for review. Now, at last, they will be. Yet as our business writer, Larry Rulison, pointed out in an article Sunday, it took a lawsuit by the Syracuse newspaper, the Post-Standard, to pry the information loose.

And it wasn't easy. The newspaper made its first attempt to retrieve the data under the state's Freedom of Information Law in 2005, but it wasn't until last February, after a long court battle, that a judge ruled in favor of openness. Even then, though, the numbers were not released until last month by the Empire State Development Corp., which runs the Empire Zone program.

The Syracuse newspaper sought statewide data from 2003 through 2005, at a time when the program was coming under fire from former state Comptroller Alan Hevesi and Assemblyman Richard Brodsky, D-Westchester. In 2004, for example, Mr. Hevesi released an audit that found that from 1999 through 2002, $3 million in tax breaks had been wasted. And Mr. Brodsky criticized the program that same year for what he said was political favoritism.

Now for the numbers: In the Capital Region, companies participating in the Empire Zone program received $112 million in tax breaks and created some 9,500 new jobs from 2003 through 2005.

Was it worth it? At least that debate can now take place on the basis of hard data.

Not all of the $112 million went to create jobs, however, and that, too, can be debated. For example, some companies received money for investing in their facilities. That was the case with Canadian-owned Brookfield Power, which operates a hydro station along the Mohawk River in Cohoes. Brookfield received some $4 million from 2003-2005 despite creating less than one new full-time job. The company says it has invested $2.5 million in the plant over the last few years, and plans $25 million in improvements over the next five years. But it's difficult to fathom how $2.5 million in investments justified that $4 million in tax relief.

Then there are companies like SuperPower Inc. of Schenectady, which is developing a conducting wire that could transform the electric power industry and produce billions of dollars in revenue. It has 60 employees and received about $900,000 in tax breaks during the 2003-2005 span. The question is: Should tax breaks be based on actual or potential return on the dollar?

It's good to hear Matthew Maguire, a spokesman for the Business Council, say that his organization supports a review of the program's costs and possibly changes to make better use of state resources. Gov. Spitzer should support that as well. And he can start by making it clear that from now on, all the numbers will be out in open.