by Steve Levy

September 4, 2025

Industrial Development Agencies (IDA) were never intended to give tax breaks to companies threatening to leave.

A company based in Suffolk County threatened to downsize and move to another state unless the IDA agreed to give them $17 million in tax breaks. The IDA caved and granted the tax reduction. 

The IDA should have denied this request. 

IDAs are very controversial in that they provide tax breaks to some companies and not to others. When one company gets a break it means other companies and residents must make up for that revenue that does not come into the government coffers. We make exceptions, and justifiably so, in certain limited circumstances where we’re looking to incentivize a big company that will provide a large number of good paying jobs that are sustainable. It’s how we successfully utilized the IDA to bring in Computer Associates and its 2000 jobs in the 1980s. It’s the way I was able to lure Canon to establish its Northern Hemisphere headquarters in Melville, bringing thousands of jobs and spurring the local economy.

And just this past month, Suffolk’s IDA justifiably granted tax breaks for two existing pharmaceutical companies in Hauppauge that have planned to expand their operations and the number of jobs in their companies. The two companies, Gemini Pharmaceutical and Commerce Drive, LLC, will add another 75 jobs to their operations.

But we must be very careful that we don’t fall into the trap of giving tax breaks to companies that threaten to leave to cheaper pastures. Every company out there is feeling financial strain in competitive markets. Of course they’re over-taxed and over-regulated and the answer is to lower taxes for everyone and every business. 

If one business is allowed to get tax breaks by simply threatening to leave, what would stop every other business from doing the same and thereby destroying our tax base. 

Maybe they will eventually leave. Sometimes that’s what happens in the market, especially in our overtaxed area such as Long Island. But we can’t be granting these special privileges to a handful of companies at the expense of others where no new jobs are being created. 

Steve Levy is Executive Director of the Center for Cost Effective Government, a fiscally conservative think tank. He served as Suffolk County Executive, as a NYS Assemblyman, and host of “The Steve Levy Radio Show.” Costeffectivegov@gmail.com