CAPITOL — Industrial development agencies in New York have been unable to finance construction projects for nonprofits since Jan. 31, and legislation that would reauthorize them has been tied up in a dispute about prevailing wage rates.

A coalition of nonprofit, municipal, business and economic development groups claimed at a news conference Tuesday that more than $2 billion worth of construction projects have been stalled across the state. Some of them could be built without the IDA financing, advocates said, but at a higher cost that would often be passed on to taxpayers.

Locally, Schenectady Metroplex Development Authority Chairman Ray Gillen said Union Graduate College secured IDA funding for its Nott Terrace project in January, just before the deadline. But he said Schenectady County Community College’s plans to build student housing off lower State Street could be adversely affected by the IDA funding standoff, because costs would rise for the project without IDA involvement.

IDA bondholders do not have to pay federal or state income taxes on the interest payments they receive. As a result, the bonds are issued with interest rates more than 2 percentage points lower than commercial rates, the advocates said.

Jeff Bray, chairman of the state Economic Development Council, said the borrowers can also spread out their payments over longer terms when they go through IDAs. Bray, who is from Fulton County, said local projects that were reliant on IDA funding included the Perth Primary Care Center, an offshoot of Nathan Littauer Hospital that opened last year, and the new YMCA set to open this year on Route 29 in the town of Johnstown, near Gloversville.

Bray and the others at the news conference, including representatives of the state Business Council and the Conference of Mayors and Municipal Officials, support a bill (A-2557) sponsored by Sen. Betty Little, R-Queensbury, and Assemblyman Joseph Morelle, D-Irondequoit, which would permanently reauthorize the IDA financing for nonprofits. They oppose a rival bill (A-8703) sponsored by Assemblyman Sam Hoyt, D-Buffalo, and passed by the Assembly, which would require that prevailing wage rates be paid on IDA projects. Bray and others said this would drive up costs and make some projects unaffordable.

Gillen, who was not at the news conference, declined to get into the issue of which bill is better but said the authorization for nonprofits to participate in IDA projects needs to be restored.

But Jobs for Justice, a labor-backed pressure group, issued a statement backing the Hoyt bill.

The news release quoted James Parrott, chief economist of the Fiscal Policy Institute (another labor-backed organization), as saying: “Research has demonstrated that prevailing wages do not raise construction costs and living wage standards lead to higher skill levels, higher productivity, and lower costs overall. A better skilled workforce is the key to our future and wage standards are the starting point.”

Sadaf Khatri, program director for New York Jobs With Justice, said there is currently no Senate sponsor for the Hoyt bill but last year’s version of the legislation was sponsored by Sen. George Maziarz, R-Newfane. It did not come up for a vote on the Senate floor, she said.

A 1986 federal law made nonprofits eligible for IDA funding. The state passed enabling legislation that year, but it expires periodically.

The Jobs With Justice statement said New York IDAs “awarded over $450 million in tax exemptions in 2006 alone to companies promising to create jobs and spur economic development in the state’s regions. However, one in every five dollars spent by IDAs went to projects that were failing. In addition, the jobs that are created by IDA projects are often low-wage, poor quality jobs — and frequently they go to out-of-state workers.”

The release said legislation should include “prevailing wage and living wage requirements, as well as measures to increase accountability and transparency among IDAs.”