Seven economic development workers are no longer employed by the Jefferson County Industrial Development Agency and will leave the state retirement system a move officials claim will limit the state comptrollers authority to dictate to the agency how it does business.
At an executive meeting Thursday, the agencys board of directors accepted resignations from staff members and authorized them to be hired by the Jefferson County Local Development Corp., a nonprofit entity, on Monday. On Monday those new LDC staff members will no longer be enrolled in the state retirement system, for which only IDA employees are eligible. The employees instead will join a 401(k) profit-sharing package this month to which the agency will contribute.
With LDC status, employees will continue their work helping businesses take advantage of economic incentives available through the JCIDA, but their job criteria will no longer be governed by state law, JCIDA CEO Donald C. Alexander said. He said the change will solve a number of lingering concerns for the agency. Efforts to assist agriculture businesses, for example, were called into question this spring when its attorney discovered state law might legally prohibit IDAs from supporting commercial agriculture. Also questioned was whether agricultural coordinator Jay M. Mattesons position might be in jeopardy due to his job criteria.
Theres always been a gray area about it, because the law didnt say what we couldnt do but what we could, Mr. Alexander said. There was a high level of uncertainty about if we could do it under the former structure with IDA employees. But we have to be able to support agriculture, and we have to do this without putting our pension benefits and livelihoods at risk. Were going to keep doing what is right for Jefferson County.
Thursdays decision by the board comes after the agency spent thousands in legal fees to comply with a ruling from state Comptroller Thomas P. DiNapoli in February 2012; it stated IDA employees associated with sub-agencies, or LDCs, dont work directly for the IDA and are therefore disqualified to receive pension benefits. To comply with the comptrollers ruling, the state Legislature passed home rule legislation in June 2012 to secure the JCIDA staffs retroactive pension benefits through July 31, 2012. The agency then spent much of 2012 restructuring its sub-agencies to comply with the ruling. It dissolved the Jefferson County Job Development Corp. and Jefferson County Agricultural Development Corp., replacing them with marketing, manufacturing and agriculture councils that do not have governing authority and report directly to the JCIDA.
The Watertown Local Development Corp. and Watertown Industrial Center Local Development Corp. were IDA subagencies that function independently and are in enrolled in private pension systems.
Mr. Alexander said the former JCIDA employees will probably be eligible to continue receiving state pension benefits from August 2012 through this month, but the state comptroller has not yet answered that question. If employees are not eligible to receive state benefits, the private 401(k) package will retroactively account for that period.
JCIDA board President David Converse said the agencys reorganized LDC employee structure is now similar to the Mohawk Valley Economic Development Growth Enterprises Corp., which serves Oneida and Herkimer counties. Because LDC employees have a service agreement with the IDA, their job responsibilities fall under the umbrella of both agencies.
Mohawk Valley EDGE is a large LDC that has two to three IDAs they provide administrative services to, Mr. Converse said. This structure will give our organizations much more flexibility in dealing with the ever-changing development environment in New York state.
JCIDA Marketing Director Mary Anne Hanley retired Tuesday. The agency is now completing the interview process to fill her position, along with a part-time accountant this year to assist Chief Financial Officer Lyle V. Eaton with daily operations.
The seven employees are Mr. Alexander and Mr. Matteson, David J. Zembiec, Lyle V. Eaton, Peggy Sampson, Joy Nuffer and Anna Hume.