State Investigation Finds UNFI Given $14 Million Without Due Process
New Yorkers Against Industrial Development Tax Abuse Demands UNFI Tax Breaks
ALBANY, N.Y., March 27, 2014
ALBANY, N.Y., March 27, 2014 /PRNewswire-USNewswire/ --The New York State
Authorities Budget Office (ABO) released a report last week finding that the
Town of Montgomery Industrial Development Agency (IDA) violated the law and
its own policies in awarding more than $14 million in property and sales tax
exemptions to grocery wholesaler United Natural Foods Inc. (UNFI).
On December 18, 2013, the New Yorkers Against Industrial Development Tax Abuse
filed a complaint with the ABO requesting an investigation into the lack of
due process and transparency in the deal between UNFI and the Montgomery IDA.
UNFI obtained property and sales tax exemptions valued at more than $14
million over 15 years to build a distribution center in Montgomery.
The ABO investigation found that the Town of Montgomery IDA gave UNFI money
belonging to the community without following a transparent process, and in
violation of the IDA's own Uniform Tax Exemption Policy, the New York Public
Officers Law (known as the Freedom of Information Law or FOIL) and the New
York Public Authorities Law. The ABO report states that:
The project application submitted by UNFI was materially incomplete. It is
clear that significant and critical information was omitted from the project
application. Further, it is questionable how the IDA board could adequately
evaluate the project without knowing the type and value of the financial
assistance being requested. In addition, by approving the project without
having the required information in the project application, the board acted in
violation of its uniform tax exemption policy.
Opacity prevailed in the UNFI deal. It is no surprise that IDA officials
admitted to the ABO that "no formal records exist indicating that a
cost-benefit analysis of the project was done, or that the value of the
financial assistance package was determined." The ABO was not able to
determine how many Freedom of Information Law (FOIL) requests were made about
the UNFI deal, but its report states "it is clear that the IDA did not respond
to each request within the timeframes specified in the Public Officers Law,
and that not all requests were responded to by the IDA."
Additionally, the ABO found that an IDA board member failed to disclose a
potential conflict of interest in the UNFI deal, did not attend mandatory
board training and did not sign the legally required acknowledgement of
Using an incomplete, word-of-mouth process, marred by violations of law,
conflicts of interest and hidden away from public view, UNFI and the
Montgomery IDA transacted away more than $14 million of taxpayer money. UNFI
did not bother to file a complete application – yet it walked away with
millions of dollars in tax abatements and minimal accountability to ensure
that the local community would benefit in return. Our schools and our
community suffer because of these secretive and underhanded decisions. The
Valley Central School District, already forced to make significant cuts that
hurt our children, will be one of the hardest hit by the sweetheart deal given
The ABO report is a great first step because it details for the public what
went wrong when UNFI applied for tax giveaways from the Montgomery IDA. The
public now deserves stringent enforcement and real accountability. We demand
that the tax breaks given to UNFI in violation of the law be rescinded.
The New Yorkers Against Industrial Development Tax Abuse is a coalition of
labor and community activists concerned about the lack of accountability for
the $7 billion a year New York state spends on corporate tax subsidies. The
coalition fights to ensure that these subsidies are not wasted on corporations
that fail to create good jobs and community benefits.
For more information about the unsustainable practices of UNFI and its retail
partner Whole Foods, follow us on Twitter @UNFI_Unfair.
SOURCE New Yorkers Against Industrial Development Tax Abuse
Contact: David White, 202-624-6911, email@example.com
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