Closing the Accountability Gap on Tax Exemptions in Erie County
The problem:
Erie County has $23.6 billion in tax-exempt property — 17.38% of all assessed value. At the current tax rate, that represents roughly $73 million a year in revenue the county doesn’t collect.
Not all of that is actionable. Government buildings, schools, and public land make up about $10.5 billion of that total. Nobody’s proposing we tax the county courthouse.
But nearly $2 billion sits in IDA and economic development exemptions alone. Another $4.2 billion belongs to nonprofit organizations. And the county’s PILOT recovery rate — Payments in Lieu of Taxes, the mechanism that’s supposed to ensure exempt properties still contribute something — is effectively zero. Out of $4.3 million owed, the county collects $105,951. That’s a 97.5% discount.
At the same time, Erie County is running a $23 million deficit in its childcare program. Families are on a waitlist. The county declined a $20 million state childcare pilot because it couldn’t afford a $2 million match — while sitting on $149.5 million in reserves.
These numbers don’t add up, and working families are the ones paying the difference.
What I’d push for as a county legislator:
1. Annual IDA Exemption Accountability Reports
Every IDA-granted tax exemption should come with a public, annual report showing: how many jobs were created vs. promised, current employment levels, total tax relief granted to date, and whether the project is meeting its commitments. If it isn’t, clawback provisions should be triggered — not waived.
2. A PILOT Floor for New Agreements
New PILOT agreements should require a minimum contribution — not a token payment. Exempt properties still use county roads, rely on county public safety, and connect to county water and sewer systems. A reasonable floor ensures they contribute to the infrastructure they depend on.
3. Sunset Reviews on Business Exemptions
Section 485-b business investment exemptions phase out over time, but only if someone is watching. The county should conduct mandatory reviews at set intervals to ensure expired exemptions are removed from the rolls promptly and active ones are still justified.
4. Large Nonprofit PILOT Conversations
Erie County’s major hospitals, universities, and institutional nonprofits hold billions in exempt property. Other upstate cities — Rochester, Syracuse, Albany — have negotiated voluntary PILOT agreements with large nonprofits. Erie County should be having those conversations. This isn’t about taxing churches or food pantries. It’s about ensuring that the largest exempt institutions contribute to the public systems they depend on.
5. Redirect Recovered Revenue to Working Families
Any new revenue recovered through PILOT reform or exemption accountability should go directly toward closing the gaps that hurt working families most — starting with the childcare deficit and property tax relief.
The principle:
Tax exemptions exist to serve the public interest. When they do, they’re worth every dollar. When they don’t, working families subsidize the difference through higher property taxes and reduced services.
Every exemption should earn its keep. And the public should be able to see whether it does.