This Week
  • The seven Rochester Business Ethics Awards finalists are profiled.

  • Rochester mourns the loss of Larry and Jane Glazer.

  • Vibrant, updated properties can be easier to market than older ones.

  • When Robert Titus joined Innovative Solutions, he "had no idea" he'd become CEO.

  • For Christian Flooring owner Christian Curts, diversification has been a key factor in his success.

  • Robert Linton guides Jazz 90.1 through a new era in media.

Gov. Cuomo's priorities for 2014 include helpful steps for business

By SANDRA PARKER
On Business
Rochester Business Journal
January 17, 2014

Gov. Andrew Cuomo delivered his agenda for the 2014-15 legislative session in his fourth State of the State address last week. We’ll learn more about his vision for New York’s future when he releases his executive budget Jan. 21. In the meantime, I wanted to highlight some of the items from the State of the State that Rochester Business Alliance believes are important to local employers.

Cuomo’s proposal to reduce the corporate franchise tax to 6.5 percent is definitely a move in the right direction. This has been a burdensome tax to businesses across New York, but especially upstate. It’s a tax that puts us at a competitive disadvantage against other states. I think some effort still needs to be expended to take the tax even lower, but this is a start.

Property taxes, as we’ve been saying for the past couple of years, are really the most onerous overall. Individual homeowners upstate are able to buy houses that are very reasonably priced, but then they get their property tax bills and are sent into a state of shock. If you look at the number of businesses in this region that pay significant property taxes, any kind of relief that the state can offer is going to be an incentive for them to stay here and grow here.

Clearly, property taxes are higher in New York than they are in any other state in the country. They’re higher by percentage of property value upstate than in any other part of the country. The governor’s proposal to offer a property tax credit for manufacturers has particular rewards. This is also important as we see a shift in the economy with non-profits and institutions of higher education hiring more people and becoming more prominent in the community. Those organizations are exempt from paying property taxes, so it puts an even larger burden on for-profit private organizations.

I think Gov. Cuomo’s proposal to eliminate the corporate income tax on upstate manufacturers is huge. Again, it’s recognition that we have a tax structure here that is not competitive with other states. A significant move like this is smart and can help bring New York back into the game. It also eases the sting that some employers felt at the launch of Start-Up New York, which is intended to draw new companies to the state. The elimination of the corporate income tax affects existing employers, so it evens the playing field somewhat. Without doubt, Start-Up New York is beneficial for the recruiting of new employers to New York, but we must do something to benefit existing businesses, as well.

We had expected the 18-a energy assessment to be eliminated last year as originally scheduled and were very disappointed when it wasn’t. At that point, we had hoped the phase-out would be on this year’s agenda, so we’re glad to see the governor propose an accelerated elimination of this surcharge, which affects anyone who pays an energy bill. Businesses and manufacturers often use a lot of energy and face a significant impact from the 18-a assessment.

Estate tax reform affects all types of employers. Its main effect is to cause wealthy people at the end of their careers to leave the region. They sell their homes and take their spending capability elsewhere to protect their estates. This proposal to bring the estate tax in line with the federal rate eases the burden when one member of the family dies.

Cuomo has also proposed a joint executive-legislative commission to reduce regulatory barriers on business. We have heard a lot of rhetoric over the years about regulatory reform. When Rochester Business Alliance does surveys, New York’s regulatory climate almost outranks taxes as a cause for complaint. Yet very little has been done to relieve regulations. As the governor said in his address, “It’s time to stop talking about it and actually get it done.” I couldn’t agree more. One respondent to a recent RBA survey said, “Mandates in New York State represent a pointed disincentive to invest and grow the economy.”

We have an opportunity this year to get rid of one of the biggest thorns in the side of New York business, the Wage Theft Prevention Act’s annual notification provision, which requires employers to provide written salary notices to employees and get signed receipts. That’s the same information that’s available on pay stubs. The YMCA of Greater Rochester, an RBA partner member, reported to us that it spends nearly $25,000 a year to comply with the Wage Theft Prevention Act. Another employer said, “We are drowning in paperwork. The Wage Theft Prevention Act may be the straw that broke the camel’s back.” It’s time to get something done about it. RBA stands ready to work with the regulatory reform commission when it meets.

We’re glad to see that the regional economic development councils are on the governor’s agenda to be funded again this year, now with a focus on global marketing and exports. The councils are valuable because they solicit local input on projects that should receive funding in very diverse regions across the state. We would, however, like to see more emphasis on regional input. It has been 20 percent in the past; perhaps it should be raised to 40 percent regional input for the decision-making.

Summing up, this is a governor who has truly crossed party lines and is looking to improve the well-being of the state overall. We hope the Legislature also recognizes this and is willing to move his agenda forward.

Sandra Parker is president and CEO of Rochester Business Alliance Inc. Contact her at SandyP@RBAlliance.com.

1/17/14 (c) 2014 Rochester Business Journal. To obtain permission to reprint this article, call 585-546-8303 or email service@rbj.net.



What You're Saying 

There are no comments yet. Be the first to add yours!

Post Your Own Comment

 
Username:
Password:

Not registered? Sign up now!
 

To Do   Text Size
Post CommentPost A Comment eMail Size1
View CommentsView All Comments PrintPrint Size2
ReprintsReprints Size3
  • E-mailed
  • Commented
  • Viewed
RBJ   Google