Statement by Kenneth Adams, president & CEO of The Business Council of New York State, Inc.
As we approach the New Year we are starting to see – thankfully - signs of national economic recovery. Consumer confidence is growing, housing starts are up, and recent surveys have employers predicting new hires in the coming months. The new federal tax package worked out by President Obama and the Congress contains tax breaks and other incentives that most economists agree will lead to new business investment and job creation.
All this is good news at the national level. But what about here in New York? As the state with the worst tax climate in the U.S. and one of the most anti-business regulatory regimes, we could miss out on U.S. economic recovery if we don't make major, lasting reforms as soon as possible. The top priority for Governor-elect Andrew Cuomo and the State Legislature has to be to build a business climate in New York that encourages private-sector investment and new job creation.
The key to a job growth agenda in New York is removing obstacles to business investment through broad-based reforms that benefit all sizes and types of employers all across the state. Let's start with the basics: a property tax cap, state spending cap, reducing the tax burden, reforming public employee pensions and limiting government borrowing. These are the fundamentals of a fiscal reform agenda we have been advancing since last spring, called “Five to Survive”. It's a plan embraced by our incoming governor as well as 48 members of the state legislature who signed on in support before the recent elections.
But that's not all. Since some of these major reforms will take time to negotiate and enact, short-term solutions should be pursued as soon as elected officials return to the state capitol. Four economic development initiatives rise to the top, ready for immediate action:
- Adopt the “Energize NY” bill that already passed the State Senate 59 to 2 with bi-partisan support. At no cost to the state, this will increase the amount of low-cost electric power available to support job creation in New York.
- Reduce the cost of capital by adopting a refundable Investment Tax Credit or accelerated depreciation of capital investments. New capital investments by New York employers will lead to new jobs.
- Fix the new “Excelsior Jobs Program” by basing the real property tax credit on the improved value of the property. This will encourage more investment and job creation.
- Adopt a version of the Governor-elect's proposed new jobs credit, which will reduce the cost of creating jobs in NY, and will be a useful tool in competing with neighboring jurisdictions for new jobs.
Creating good private sector jobs is the most important challenge facing New York. The only way to make our state's economy thrive again is to reduce the many obstacles that discourage private sector employers from investing and hiring here. We will need a much more competitive business climate in New York if we are serious about retaining and attracting successful firms in growth-oriented sectors.
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