NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A10594A
SPONSOR: Bing (MS)
TITLE OF BILL: An act to amend the New York state urban development
corporation act, in relation to establishing a Second Avenue Subway
construction economic development grant program; and to amend the
economic development law, in relation to the definition of micro busi-
PURPOSE OR GENERAL IDEA OF BILL: To provide financial and technical
assistance to businesses located along the route of the Second Avenue
Subway construction in Manhattan during the construction process.
SUMMARY OF SPECIFIC PROVISIONS: Section 1 adds a new section 16-p to
Section 1 of Chapter 174 of the New York State Urban Development Corpo-
ration Act creating the Second A venue Subway construction economic
development grant program and defines terms. Financial assistance under
this program may be provided for capital improvements; marketing and
advertising costs; and, for endangered and terminal businesses, payroll,
rent, utilities, insurance and counseling assistance. This legislation
will also establish a technical assistance program to assist small and
micro businesses through third-party service providers. Grants will be
awarded through an application procedure.
Section 2 adds a new section 131-a to the economic development law by
defining a micro business as one which is resident in this state, inde-
pendently owned and operated and employs 10 or fewer people on a full-
Section 3 contains the effective date.
JUSTIFICATION: The East Side of Manhattan is currently undergoing one
of the most significant construction projects in decades -- the creation
of the long-awaited Second Avenue subway. The construction has begun and
will eventually run through parts of eight Assembly Districts. While the
Second A venue subway will eventually bring much needed transportation
improvements to the East Side, it is currently having a substantially
negative effect on local businesses. Some establishments in the heart of
the initial construction have lost 20 or 30 percent of business, and
others have closed permanently. This bill would create a Second Avenue
Subway construction economic development grant program for the purpose
of providing financial and technical assistance to small and micro busi-
nesses located within the area where construction is taking place.
Assistance would be provided for projects such capital improvements,
marketing and advertising, as well as emergency funds for endangered
businesses. Thus, any grants from this program would be funneled right
back into the New York City economy.
PRIOR LEGISLATIVE HISTORY: This is a new bill
FISCAL IMPLICATIONS: To be determined, depending on the money author-
ized for the program by the appropriate agencies.
EFFECTIVE DATE: Immediately.
STATE OF NEW YORK
April 16, 2008
Introduced by M. of A. BING, KELLNER, GLICK -- Multi-Sponsored by -- M.
of A. BOYLAND, GOTTFRIED, REILLY -- read once and referred to the
Committee on Economic Development, Job Creation, Commerce and Industry
-- reported and referred to the Committee on Ways and Means -- commit-
tee discharged, bill amended, ordered reprinted as amended and recom-
mitted to said committee
AN ACT to amend the New York state urban development corporation act, in
relation to establishing a Second Avenue Subway construction economic
development grant program; and to amend the economic development law,
in relation to the definition of micro business
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Section 1 of chapter 174 of the laws of 1968, constituting
2 the New York state urban development corporation act, is amended by
3 adding a new section 16-t to read as follows:
4 § 16-t. Second Avenue Subway construction economic development grant
5 program. (1) There is hereby created a Second Avenue Subway construction
6 economic development grant program for the purpose of providing finan-
7 cial and technical assistance to businesses located within the Second
8 Avenue Subway construction business zone area during periods of
10 (2) For the purposes of this section the following words or terms
11 shall mean as follows:
12 (a) "Small business" shall have the same meaning as defined in section
13 131 of the economic development law.
14 (b) "Qualified business" shall mean a small business or micro business
15 operating within a one hundred fifty foot radius of the business zone
16 area during a period of authorized construction, and the business has a
17 demonstrated loss.
18 (c) "Business zone area" shall mean:
19 (i) an area in which the chair of the corporation determines that
20 construction on the Second Avenue Subway project has occurred that has
21 been certified by the commissioner for the Metropolitan Transportation
22 Authority; or
23 (ii) the following areas:
24 (A) 125th Street from 5th Avenue to 3rd Avenue;
25 (B) 2nd Avenue from 129th Street to 91st Street;
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
 is old law to be omitted.
A. 10594--A 2
1 (C) 2nd Avenue from 87th Street to 83rd Street;
2 (D) 2nd Avenue from 73rd Street to 69th Street;
3 (E) 2nd Avenue from 65th Street to 58th Street;
4 (F) 2nd Avenue from 45th Street to 41st Street;
5 (G) 2nd Avenue from 36th Street to 32nd Street;
6 (H) 2nd Avenue from 26th Street to 23rd Street;
7 (I) 2nd Avenue from 15th Street to 11th Street;
8 (J) 2nd Avenue from 6th Street to 4th Street;
9 (K) 2nd Avenue from 4th Street to Houston Street;
10 (L) Chrystie Street from Houston Street to Canal Street;
11 (M) Bowery from Pell Street to Worth Street;
12 (N) Worth Street from Mott Street to St. James Place;
13 (O) Water Street from Dover Street to John Street;
14 (P) Water Street from Wall Street to Coenties Slip.
15 (d) "Micro business" shall have the same meaning as in section 131-a
16 of the economic development law.
17 (e) "Period of authorized construction" shall mean those dates for
18 which the chair of the corporation determines that construction on the
19 Second Avenue Subway project has occurred for the specific portion of
20 the business zone area.
21 (f) "Demonstrated loss" means a ten percent decline in taxable income
22 in the year in which the grant is applied for compared to the business'
23 base fiscal year.
24 (g) "Base fiscal year" means the tax year immediately preceding the
25 year in which construction began in that portion of the business zone
26 area in which the business is located.
27 (h) "Endangered business" means a business that would otherwise be
28 deemed a qualified business as defined in paragraph (b) of this subdivi-
29 sion, but who can show a demonstrated loss of a thirty percent decline
30 in taxable income in any given year compared to the business' base
31 fiscal year.
32 (i) "Terminal business" means a business that would otherwise be
33 deemed a qualified business as defined in paragraph (b) of this subdivi-
34 sion, but who can show a demonstrated loss of a fifty percent decline in
35 taxable income in any given year compared to the business' base fiscal
37 (3) Assistance, out of moneys made available for this program, shall
38 be provided to qualified businesses for the following purposes:
39 (a) capital improvements costs related to the following:
40 (i) improving signage so that pedestrians can easily see and identify
41 the business as an operating business;
42 (ii) expanding existing entryways to the business;
43 (iii) altering the existing entryways, windows, walls or structure to
44 prevent or minimize excessive noise occurring from the construction;
45 (iv) improving ventilation within the building to maintain air quality
46 within the business;
47 (v) equipment, machinery, furniture, fixtures and fittings necessary
48 to the running of a qualified business that shall be affixed to and
49 remain a part of the qualified business location within the business
50 zone area; and
51 (vi) such other capital improvements as determined by the chair of the
53 (b) marketing and advertising costs.
54 (c) for endangered businesses, as determined by the chair of the
55 corporation, such as:
A. 10594--A 3
1 (i) payroll assistance; provided, however, any payroll assistance
2 payments made must be made to an employee who has been employed by the
3 business for at least one year, does not have an ownership interest in
4 the business, and is not related, either through blood or marriage, to
5 the owner of the business;
6 (ii) rental payment assistance, whether for real property or equipment
7 and services;
8 (iii) utilities, including but not limited to electricity, phone,
9 cable, internet, and water; and
10 (iv) insurance, as determined by the chair of the corporation.
11 (d) for terminal businesses, as determined by the chair of the corpo-
12 ration, such as:
13 (i) assistance offered to qualified and endangered businesses under
14 this subdivision; and
15 (ii) professional counseling services, dissolution services, profes-
16 sional bankruptcy assistance services, and debt management services.
17 (4) The corporation shall also:
18 (a) (i) Establish a comprehensive technical assistance program in
19 cooperation with the department of economic development to assist small
20 and micro businesses through third party service providers, which
21 assistance shall include, but not be limited to:
22 (A) technical assistance with applications for obtaining funds from
23 public and private financing sources;
24 (B) technical assistance in the development of a working capital budg-
26 (C) referrals to other providers of technical assistance to small and
27 micro businesses, where appropriate, including the entrepreneurial
28 assistance program established pursuant to article 9 of the economic
29 development law; and
30 (D) technical assistance through education programs.
31 (ii) Technical assistance may be provided through direct corporate
32 support, or through grants to or contracts with service providers or
33 governmental entities.
34 (b) establish programs to assist small and micro businesses in devel-
35 oping workplace policies, including but not limited to the design of
36 employee benefit and assistance programs and developing child care
38 (c) provide grants to business improvement districts, local develop-
39 ment corporations, other not-for-profit economic development organiza-
40 tions, and municipalities for tourism, marketing, promotion, information
41 activities and commercial revitalization activities in the business zone
42 area, such activities may include, but are not limited to, joint print,
43 mailed and internet advertisements, marketing campaigns and redevelop-
44 ment work in connection with the design and implementation of a plan for
45 facade and other improvements throughout the business zone area. Such
46 grants may include monies available for individual property owners
47 and/or tenants who agree to improve their property in accordance with an
48 overall design plan, provided that, such individual property owners
49 and/or tenants shall be required to match at least fifty percent of the
50 amount of any grant awarded to them.
51 (d) provide grants to small and micro businesses to offset costs asso-
52 ciated with the start-up of new business enterprises provided that the
53 space in which the business is going to be located has been vacant for
54 at least one year, the business owner has entered into a lease for at
55 least two years and the landlord or business owner shall be required to
56 match at least half the amount of any grant awarded to them. Such
A. 10594--A 4
1 grants may be used to provide technical assistance in development and
2 execution of business plans, including the formation of, acquisition of,
3 management of, or diversification of a small or micro business.
4 (5)(a) The corporation shall, within available appropriations, award
5 grants or enter into contracts for services pursuant to this section to
6 small and micro businesses, through direct applications accepted at the
7 discretion of the corporation. For the purposes of this subdivision the
8 corporation shall enter into annual contracts for services or award
9 grants in an amount equal to fifty percent of the total project costs to
10 qualified businesses.
11 (b) The corporation shall enter into no more than one contract or make
12 more than one grant per year per applicant under this subdivision with
13 any qualified business regardless of the number of projects for which an
14 applicant has applied and for which funding has been approved. In the
15 case of applications for multiple projects to be conducted by a single
16 applicant, the corporation may, at its discretion, provide a grant or
17 enter into a single contract for services with the applicant for some or
18 all of the projects for which an applicant has applied.
19 (c) Not-for-profit corporations, business improvement districts and
20 community development organizations shall be eligible to apply for
21 support under this subdivision to operate a program or programs of busi-
22 ness and economic development services to stabilize, retain or revital-
23 ize existing qualified businesses, and to assist small, micro, and rein-
24 vesting businesses, including, but not limited to assistance to
25 individual businesses in such project areas as:
26 (i) business planning, management assistance and counseling, and
27 financial packaging assistance to small and micro businesses, including
28 the establishment of neighborhood-based business service centers
29 designed to deliver comprehensive technical assistance to new and small
30 businesses in specific communities and neighborhoods;
31 (ii) programs to assist small and micro businesses in the business
32 zone area to identify new business opportunities, plan for new enter-
33 prise development, and manage economic development projects;
34 (iii) innovative programs of public and private cooperation to foster
35 new enterprise development and small and micro business growth;
36 (iv) programs to assist new enterprises and small and micro businesses
37 to identify and access public and private sources of equity, working
38 capital and other types of financing; and
39 (v) programs that improve the ability of small and micro businesses to
40 access state job training programs.
41 (6) Any applicant, who is awarded a grant pursuant to this section
42 where the moneys of such grant are to be used for the construction,
43 repair, or renovation of any portion of the business, shall ensure that
44 such work is performed in accordance with section 231 of the labor law.
45 (7) An applicant who receives a grant pursuant to this section shall
46 ensure and shall sign a written declaration prior to receiving any funds
47 stating that all provisions of the labor law, specifically including the
48 minimum wage provisions of article 19 of the labor law, are adhered to
49 by the business receiving the grant.
50 § 2. The economic development law is amended by adding a new section
51 131-a to read as follows:
52 § 131-a. Definition of a micro business. For the purposes of this
53 chapter, a micro business shall be deemed to be one which is resident in
54 this state, independently owned and operated, not dominant in its field
55 and employs ten or less persons on a full-time basis.
56 § 3. This act shall take effect immediately.