Competing ED Proposals in New York Share Same Goal

March 19, 2004

Although their courses of action may differ, competing proposals sponsored by the New York State Senate and Assembly would seem to have the same goal — create jobs, support small businesses, and transform the state's manufacturing sector.

Representing one side is Senate Majority Leader Joseph Bruno (R-Raymond), whose proposal would create the Excell-NY initiative. Bruno established the NexGen task force in December 2003 to provide recommendations for sustained job creation and economic growth, and Excell-NY resulted. The success of previous economic development programs such as JOBS 2000, Gen*NY*sis and NYSTAR led to the new initiative.

Excell-NY would cost the state $7 million in its current fiscal year and $50 million over the plan's proposed 10-year lifetime. At the core of the initiative are five regional nonprofit centers for innovation that would provide businesses with innovation capital and venture capital as well as business and technical expertise. Other components include:

  • Venture capital and financial assistance. The Excel-NY centers would operate four capital funds to provide matching funds for early-stage companies and federal grants.
  • Expansion of the Pipeline for Jobs program to allow infrastructure improvements for incubators, commercialization centers or business parks for technology research and development (R&D). The program typically has provided grants, loans and interest subsidies to growing businesses for the construction of new water supplies.
  • Targeted tax reductions to include an expansion of the current R&D credit from 9 percent to 40 percent. The credit would be refundable and available for four years. And,
  • Empire Zone reform and expansion through the establishment of a two-mile Empire Zone in the current eleven counties without zones and increased acreage in Genessee and Orleans counties.

Meanwhile, NY@Work - a competing proposal sponsored by Assembly Speaker Sheldon Silver (D-Manhattan) - concludes that New York has trailed the nation in job growth over the last nine years. The initiative calls for $280 million in new capital investments, $250 million of which would come from the $99.8 billion Gov. George Pataki included in his 2004-05 budget proposal for other programs. Also included is $60 million in tax credits beginning in 2005-06 for supporting venture capital investment to encourage high tech business formation.

NY@Work proposes the following:

  • Steer the tax-free Empire Zone program for businesses to economically distressed areas.
  • Reform the program to remove abuses that allowed some companies to reincorporate and qualify for tax breaks meant for new or expanding businesses.
  • Overhaul the state’s economic development structure by giving the leaders of the legislature control over the Empire State Development Corp. equal to the governor’s.
  • Create a manufacturing assistance program, including a “make-it-here” initiative focusing on small manufacturers and niche markets.
  • Create a commercialization policy that commits academic research institutions to translate their innovations into jobs.
  • Extend and reform the ‘power for jobs’ program that provides subsidized energy for certain businesses.
  • Provide for comprehensive work force education and training as well as education for technology driven jobs.

An economic policy coordination board also would be created under the New York State Assembly’s plan to improve the accountability and efficiency of the state’s economic development efforts.

More information on both proposals can be viewed at: http://www.senate.state.ny.us/ and http://www.assembly.state.ny.us.

New York