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New York affiliate of the National Wildlife Federation
PRESS RELEASE
February 21, 2008
ENVIRONMENTAL WATCHDOG SHINES LIGHT ON NEW YORK'S PERVERSE TAX CREDITS, SPRAWL SPENDING
''Wasted Green' Report Describes How Lost Revenue & State Spending Shortchange Taxpayers, Environment
(ALBANY, NY) – Environmental Advocates of New York
released a new report today on three examples of state
spending and tax credits gone wrong. Wasted Green: How
Lost Revenue & State Spending Shortchange New York Taxpayers
& the Environment shows how the state’s Brownfield
Tax Credits are exposing New York to more than $1
billion in lost revenue; the Empire Zone Program,
intended to stimulate economic development in distressed
communities, has become a corporate welfare program
subsidizing one of the state’s worst polluters; and New
York’s Drinking Water State Revolving Fund, created with
the best of intentions, may be working at cross-purposes to
efforts to fight sprawl. The complete report is available at
www.eany.org.
“Environmental Advocates of New York is calling on Governor
Spitzer and the State Legislature to stop wasting green and
start acting green. It’s time to rethink New York’s fiscal
policy and better protect taxpayers, as well as the health
of our air, water and land,” said Robert Moore, executive
director of Environmental Advocates of New York. “Wasted
Green gives three examples of how state spending is
squandering taxpayer dollars. And in light of the state’s
projected out-year budget gap, it makes sense to save money
by reforming tax credits under New York’s Brownfield Cleanup
and Empire Zone programs, and better scrutinizing who
receives low-interest loans under the state’s Drinking Water
State Revolving Fund.”
Fixing the tax credits under the Brownfield Cleanup and
Empire Zone programs, and re-thinking how loans are doled
out under the state’s Drinking Water State Revolving Fund,
are especially important as the Governor’s Executive Budget
proposal includes sweeping more than $100 million from New
York’s Environmental Protection Fund to the general fund.
Rather than balancing the state’s budget on the back of
already overstretched environmental programs and agencies,
Environmental Advocates of New York urges the Governor and
the State Legislature to look elsewhere. In particular, our
leaders should take a hard look at programs wasting taxpayer
dollars and operating at cross-purposes to environmental
policy goals.
Under the current Brownfield Cleanup Program,
developers and not communities are reaping the benefits of
millions in tax credits. According to the New York State
Division of Budget, more than $1 billion in tax breaks may
go to just 54 developers. Because tax breaks are based on
redevelopment value, rather than cleanup cost, sites with
the least contamination and the highest redeveloped value
get cleaned up and contaminated sites that would most
benefit from redevelopment are left dirty and undeveloped.
For example, one site in Manhattan that was cleaned up to
make way for a high-rise apartment complex is slated to
receive more than $140 million in tax credits—seven times
the cost to prepare and clean-up the site. Environmental
Advocates’ recommendations to reform this program are to
disconnect eligibility from tax credit eligibility.
Wasted Green also calls attention to the Empire Zone Program. Our research uncovered that three NRG Energy power plants have received $88.7 million in state tax breaks. We also found that NRG received these tax breaks while the state was suing the power producer for spewing more than three million tons of climate-altering pollution into our air. Recommendations for fixing the Empire Zone Program include ensuring companies that have violated state and federal environmental requirements, or other health and safety standards, are not eligible for tax benefits. We also want the program to meet its mission to create jobs.
The last section of the report is focused on New York’s Drinking Water State Revolving Fund. This loan fund may be subsidizing sprawl. Our research uncovered that communities with declining populations may be using low-interest state loans to build water lines to undeveloped areas, thereby encouraging poorly planned development. For example, the Monroe County Water Authority applied for a $21 million loan to build a new intake facility, despite the Authority’s ample water capacity and the county’s stagnant population changes.
Environmental Advocates is calling on the state to take a closer look at applications to the Drinking Water State Revolving Fund and to make sure that only those proposals that address a legitimate environmental or health concern get funding. For more information, or to access the complete report, visit www.eany.org.