Is There a Smarter Approach to Economic Development?

Read any local newspaper in this state, and you will be sure to come across an article or an editorial bemoaning the lack of economic development in New York. Since 1995, the Pataki administration has spent $30 billion in tax breaks. Unfortunately, the results have been abysmal. In fact, if our job creation kept pace with the rest of the country, we would have created approximately 450,000 jobs by now.

After more than a decade of experiments with this process, it is clear to me that it simply doesn’t work. The effects have been devastating. For example, New York has lost several Congressional seats in the House of Representatives, and the clout that goes with it, because we keep losing workers to other states with more economic opportunities.

Despite having some of the finest colleges and universities in the world, too many students leave New York after graduation. That’s why I’m using this opportunity to point out that I’ve joined with my Democratic colleagues in the Senate in introducing a four-point approach to reforming the state’s economic development programs.

First, the plan would create regional economic development planning boards, which would be comprised of representatives from regional businesses, Empire Zone boards, industrial development agencies, and Department of Economic Development regional offices. By doing this, we can avoid the hyper-competitive environment that exists with local governments battling one another for business creation. Each region would develop a strategic plan, assessing its economy, infrastructure and workforce, as well as its strengths, weaknesses and developmental opportunities.

Second, the plan would do a better job of supporting the state’s more than one million small businesses, the backbone of our economy. We are simply not doing enough to create more small businesses, nor are we helping those that already exist to prosper. Our plan would create one-stop economic development centers in every region of the state, enabling small businesses to get the technical assistance they need, whether its help obtaining startup funding or providing employees with low cost health insurance.

The third part of the plan would require developers receiving state or local assistance to employ local labor resources in the construction of new facilities and infrastructure. When local contractors, firms and residents are involved in a new project, its completion will reflect the shared values and hard work of that community.

Finally, the fourth point would continue our call for reform of the Empire Zone Program, which started with the best of intentions, to bring jobs, opportunity and hope to blighted urban areas. Today, thriving companies are receiving additional tax breaks, shifting tax burdens onto other small businesses outside the zone.

Attorney General Eliot Spitzer endured criticism for saying that parts of Upstate New York looked like Appalachia. However, top state officials and business groups agreed with his assessment. It is still not too late to act. We need to do what’s right for all New Yorkers and enact this plan.