Setting the Agenda: Economic Development

New York’s economy has been struggling, with unemployment remaining high throughout the state, nearing 10 percent in New York City and rising above that in several counties.

Health insurance, education, and pension costs are rising, the population in many counties is aging, and the state may even consider taking control of some town budgets with financial control boards if municipalities are unable to reign in costs and debt.

But New York’s economic forecast isn’t all showers and thunderstorms.

Agriculture is one of the state’s growing industries, with 36,300 farms producing $4.7 billion in products annually, according to the state comptroller.

And the construction of a new Tappan Zee Bridge, the state’s largest public-works project in years, is expected to create 45,000 construction jobs over the next five years.

Tourism is rising as more than 50 million visitors came to New York City last year and Gov. Andrew Cuomo announced a new $1 million initiative supporting historic sites throughout the state.

Legislators are optimistic that the state will improve job creation and its competitiveness in the coming session.

“The most important agenda for next year is to do no harm and ideally do some good,” said Assemblyman Robin Schimminger, chairman of the Economic Development Committee. “We’ve seen limited budget growth, we’ve seen a tax cap, and now we need to continue to back up our theme that New York is open for business with further steps to improve our job-creation climate.”

If Democrats take over the State Senate majority in November, left-leaning legislators are keen on introducing a bill that would raise the minimum wage from $7.25 to $8.50, and eventually to $9.25.

“A minimum-wage bill to us is the lynchpin that starts the ball rolling toward a full economic recovery,” said Ibrahim Khan, an aide to state Sen. Adriano Espaillat, who would sponsor the legislation. “We think it makes sense, we think it’s fair and we think it puts money back in the pockets of low-wage consumers.”

Republicans have quashed proposed increases in the past, but the bill enjoys support in the Democratic-controlled Assembly and with the governor. Espaillat may move to get the bill introduced in the Assembly first, where it would be easier to pass, but the senator must fend off his own primary challenge next month before considering any policy moves.

Democratic state senators hope to be able to convince their colleagues to support the bill when the time comes for a debate.

“It is an opportunity for economic development, as well as helping the quality of life for so many New York residents, but we have not been able to persuade our colleagues across the aisle that it’s a win for everyone, for low-wage workers and for businesses that provide goods and services to the workers,” said state Sen. Andrea Stewart-Cousins.

The Legislature will also consider a number of less controversial bills.

Schimminger hopes to institute reforms to the scaffold law, and Stewart-Cousins hopes to build upon a series of biotech grants to help businesses in Westchester County.

Stewart-Cousins already secured a $3.5 million grant for a New York medical-school project and helped a pharmaceutical company in Tarrytown that treats colorectal cancer with $4 million in economic development funds.

This coming year she hopes to reintroduce a bill creating a microbusiness outreach center within the Department of Economic Development. Cuomo vetoed it last year, but it passed both houses.

“It’s important we support our local businesses in the communities that are able to reach out and employ local community residents,” she said. “Sometimes the difference is a very small loan or grant. They’re never going to qualify for 100,000 in tax credits, but a microloan or some concrete direction can sustain smaller mom-and-pop businesses who employ people in these communities.”

What Got Done in 2012:
Regional economic development council grants
Expansion of tax increment financing for school districts
Tax credit for historic preservation

What’s on the Agenda:
Minimum-wage hike
Scaffold-law reform
Economic development grants

INSIGHT
Partnership for New York City
Helping government to identify and enact pro-jobs, pro-growth tax, regulatory and investment policies is the top priority of the Partnership for New York City. The state must continue to pursue policies that make New York more competitive, more affordable and more attractive to businesses and residents.

The Partnership supports state investment in economic development that is tied to job creation, workforce development and building innovation industry clusters. The state’s Excelsior Jobs Program and film and digital-media tax credits are great examples of how this strategy can generate a significant return on state investment. In this economic climate, it’s also critical to look for innovative partnerships to solve tough problems. This year we worked with the state to create the New York Digital Health Accelerator, which leverages private-sector resources to support the state’s Medicaid redesign initiative. This is a terrific partnership that will result in improved outcomes for patients and jobs for New Yorkers in a new digital health industry. The Partnership will continue working with the state to expand Excelsior, fund new industry clusters and develop innovative solutions that move our economy forward.

At the same time, the state still ranks poorly as a place to establish a business. This is because of high costs, exposure to litigation, and a difficult tax and regulatory environment. The business climate that exists today is just not competitive in a global economy. The Partnership will promote policies and legislation that reduce the burdens on business and create a more positive environment for job creators. Streamlining and expediting environmental review for development projects, simplifying our business tax structure and opposing new mandates and impositions on employers will be key focus areas for the Partnership this year.

Unshackle Upstate
by Brian Sampson
Executive Director of Unshackle Upstate
New York State is a better place today than it has been in years. Gov. Cuomo and the Legislature have done a remarkable job over the last two years and should be commended for their efforts to unlock our state’s true economic potential.

Our vision for New York is based on reducing state and local spending; reducing the tax burden; eliminating unnecessary and costly mandates; and reducing the state’s reliance on debt.

We are generally pleased with the 2011 and 2012 sessions—two consecutive responsible state budgets, a property tax cap and pension reform. However, much more work remains to be done.

The 2013–14 state budget must hold the line on spending, and avoid imposing any new taxes or fees.

We need to see action on business mandate relief and regulatory reform. New York State remains a difficult place for businesses and job creators to operate, and it just isn’t enough to say that we are “open for business.” I will continue to push these issues through my role as a member of the Chairman’s Committee for the Regional Economic Development Councils.

Finally, additional reforms must be addressed for our local governments and school districts to function properly. Numerous unfunded mandates have made our communities unaffordable. The Let New York Work agenda includes several mandate relief items that will enable local governments and school districts to maintain vital services without raising taxes.

We look forward to working with Gov. Cuomo and the Legislature to promote job growth and strengthen our economy.

 

Rochester Business Alliance

By Sandy Parker

President and CEO

As the regional chamber of commerce for a nine-county upstate area, the Rochester Business Alliance focuses on providing support to employers and advocating for an economic environment that promotes business success.

Frankly, we’d like to see our representatives in Albany do the same.

While changes have been instituted to make New Yorkmore business-friendly, and the regional council model has been a welcome shift in the economic development process, we continue to rank among the worst in state rankings on such growth-stifling indicators as tax burden and the cost of doing business. Our elected officials simply must do more to make New York truly “open for business,” including reducing state spending, borrowing taxes, fees and assessments.

Near the top of our list is reducing mandates – that tangle of laws and regulations that make New York notoriously unfriendly to job creation while saddling local governments with expensive requirements, typically without funding. The result: Local governments end up with higher costs, which they recoup with higher taxes on their constituents. The property tax cap was instituted to reduce the tax burden, but it’s absolutely unrealistic to expect that to succeed without significant mandate relief. A place to start is by repealing or substantially modifying the annual notification requirement of the Wage Theft Prevention Act to make compliance less of a burden.

We also believe there is much more work to be done to help employers actually see the benefits that had been promised with the Workers’ Compensation reforms adopted in 2007.

Economic growth is the key to prosperity for all New Yorkers. Let’s get our Legislature focused on taking the right actions, on promoting growth that will make our state a great place to live, work, run a business and raise a family.