Small Business: The Heartbeat Of New York’s Economy
Every day, small-business owners across New York find innovative ways to deliver professional services, provide high-quality products, meet their payrolls and make positive contributions to their respective communities. The entrepreneurs owning and operating these small businesses demonstrate that same pioneering, can-do spirit which built our great nation.
Nearly 98 percent of businesses in New York State are small businesses. These 1.7 million small businesses account for more than half of the state’s private sector employment. Without question, small businesses – the mom-and-pop stores, firms and boutiques located on Main Street – are the heartbeat of New York’s economy.
Small-business owners have an amazing capacity for finding creative solutions in even the most challenging of economic times, like those we are currently facing. Adding to this challenge are the enormous financial burdens of doing business in New York, where our taxes, regulatory, transportation, workers’ comp and legal costs are among the steepest in the nation.
According to the National Federation of Independent Business, New York has the second-highest cost of doing business in the country, following only Hawaii, largely because we have the worst combined tax burden, the fourth highest energy costs and ninth highest health care expenses, as noted by the Public Policy Institute of New York State, Inc. These expenses are like an anchor pulling down New York’s economy, contributing to a loss of over 122,000 private-sector jobs in 2008, more than 20,000 of which came from manufacturing.
The Public Policy Institute also reported that government-related costs of living and doing business in our state are $35 billion above the national average, or roughly $1,830 annually for every New Yorker, and $5,015 for every private-sector job above what they would be if the state imposed costs at an “average” rate.
Having worked extensively in the private sector prior to entering public service, I have a deep appreciation of how difficult Albany makes it for small businesses to succeed. A large part of the problem is Albany’s failure to keep pace with the changing needs of employers, especially small businesses.
My Assembly Minority colleagues and I recognize the need to provide some relief to small businesses, which is why we introduced Assembly Bill A.6547, the “Small Business Relief Act of 2009.” If enacted, our Small Business Relief Act would:
- Authorize a sales tax exemption for businesses located in an Academic Incubator facility;
- Establish the “College to Work Program” to provide companies that pay college tuition on behalf of an individual, with a tax credit equal to 25 percent of the tuition paid, with a maximum allowable credit of $5,000 annually per individual;
- Commercialize Centers of Excellence and Genesis Centers of Research to allow companies that have conducted R&D in the state to continue receiving tax benefits when they move into actual manufacturing;
- Eliminate the S-Corp tax for small businesses;
- Increase the Sales Tax Vendor Credit from five to 10 percent, and raise the maximum credit to $1,000 per year to more fairly reimburse compliance costs;
- Restore the one percent lower tax rate for small businesses;
- Provide a Small Business Energy Tax reduction;
- Make property owned by a small business (100 or fewer employees) eligible for basic STAR benefits to reduce its property tax burden; and
- Create a tax credit of up to $300 per employee to small businesses, with 100 employees or less, that provide on-the-job training.
Of course, these solutions are just a beginning, not an end. There is much more Albany can do to start helping, and stop hurting, small businesses. Small businesses truly are the heartbeat of New York’s economy – let’s keep them beating strong.
As always, constituents wishing to discuss this topic, or any other state-related matter, should contact my district office at (315) 781-2030, or e-mail me at email@example.com.