New York City Council

Testimony to the Economic Development Committee

June 9, 2004

“Oversight – Requirements for Reporting Compliance With Corporate Subsidies Agreements: Are They Effective?

Jeremy Reiss, Project Director

Urban Agenda

A Project of the NYC Central Labor Council and the Queens College Labor Resource Center, CUNY

            Good afternoon.  I am Jeremy Reiss, Project Director of Urban Agenda.  Urban Agenda is a joint project of the NYC Central Labor Council and the Queens College Labor Resource Center, CUNY.  We are especially pleased that the Council has developed Intro 373 to strengthen Local Law 69 and the reporting requirements for corporations receiving subsidies in exchange for creating and retaining local jobs.  This new process of transparency and accountability will help the city on many fronts:  more workers will be more able to find and keep good jobs; this job creation will help maintain the social and economic fabric of our city; and taxpayes – the wider public – will fully understand the implications of and expectations for corporate retention deals.

            As we all know, New York City is undergoing a massive and unprecedented period of physical and economic development, from the Far West Side to Lower Manhattan and Brooklyn.  Each of these projects has the potential to create good jobs for city residents, which is especially needed now that approximately 250,000 jobs have been lost due to September 11^th and its aftermath. 

            From a labor viewpoint, Intro 373 will help us plan for our city’s future.  It will help us understand where jobs are being created, as well as the wages and benefits offered.  Establishing a more clear process for accountability – as outlined in Intro 373 –  will simply ensure that companies receiving city funds do what they say they are going to do, rather than taking their money and running away, as unfortunately has too often been the case.  In terms of the legislation, we are particularly impressed that not only will the number and status (full-time vs. part-time) be specified, but corporations will also be required to report hiring and retention data based on a detailed list of job classifications. 

            From a social and economic justice viewpoint, Intro 373 helps us understand the current and future social fabric of the city, and hopefully allows us to work creatively and collaboratively so we can erode some of the vast inequalities which continue to plague our city.  In a society where the average CEO earns 500 times the pay of the average worker, there is no reason that companies receiving city funds under the pretext that they will create and maintain good jobs should not be held to task.  Ensuring this level of transparency is part of the solution – along with other comprehensive social policy reform at the local, state, and federal levels – to establishing equity in a city that employs “barely half” of its black male residents, according to a new study by the Community Service Society.

            Finally, tax payers have a fundamental right to know how and where their dollars are being spent.  Into 373 will demystify the process of subsidy allocations in a way the broad public can understand, thus increasing scrutiny and ensuring transparency and accountability.  In the process, the legislation before us will help local communities leverage concrete public benefits, such as increased local neighborhood spending and further job creation, when jobs are created in their neighborhoods. 

            We – and our parent organization, the NYC Central Labor Council – wholeheartedly support the adoption of Intro 373 as a way to strengthen Local Law 69, and look forward to working with the Council on the adoption of this legislation.  Thank you.