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SUNY colleges support Start-Up NY program

Rochester Business Journal
July 5, 2013

Leaders of local SUNY colleges are praising a state program meant to attract new businesses in and around their campuses with the promise of a decade without taxes.
 
The Start-Up NY program proposed by Gov. Andrew Cuomo and approved by the state Legislature creates tax-free zones in and around SUNY campuses, which Cuomo said is an effort to slide an advantage toward the state in keeping and creating businesses.
 
Every SUNY community college and four-year college or university can establish tax-free zones using vacant land on campus, space in buildings on campus or up to 200,000 square feet within one mile of campus. The plan also allows for private colleges to apply for tax-free zones as well, though the decision will be made by the Start-Up NY program board.
 
Cuomo last week visited Monroe Community College to tout the program, saying the tax-free zones will help the state retain businesses and turn around New York's reputation of high taxes. Cuomo has said the program also will help stop the brain drain, as students from state colleges and universities take their talents-and their startups-out of state to avoid high taxes.
 
Colleges have until Dec. 31, 2020, to identify companies and have them apply to enter the program. At that point Empire State Development Corp. is to evaluate the program to determine if it should be extended.
 
MCC president Anne Kress said the program opens a host of opportunities for the college. There already has been interest in the college's downtown campus from businesses, and its new location in the former Eastman Kodak Co. building comes with additional space that could neatly fit a business partner, she said.
 
The program also would open up opportunities for the college's applied technology campus on West Henrietta Road in Brighton, Kress added.
 
The Start-Up NY program would be a boon to MCC and other community colleges, allowing them to further their mission of workforce development, she said.
 
"The potential to have a business located near the college, one that provides students the opportunity to walk across the hall or across the quad to work when they graduate, is unlike anything we've seen here before," Kress said.
 
To participate, businesses must be aligned with or further the academic mission of the campus, college or university sponsoring the tax-free community. Each participating business must create and maintain new jobs to participate, and the business must either be a new startup, a company relocating to New York from out of state or an expansion of an existing New York company.
 
There would be some additional restrictions, with retail and wholesale businesses and restaurants not eligible.
 
Start-Up NY allows participating companies to avoid business, sales and property taxes for 10 years. Employees in these companies would pay no income taxes for the first five years and for the second five years would pay no taxes up to $200,000 for individuals, $250,000 for a head of household or $300,000 for taxpayers filing jointly.
 
The plan calls for each campus to develop a plan for the type of businesses it intends to attract and the locations that will be tax-free. To participate, businesses must apply directly to the participating college and ESD will review applications to ensure eligibility.
 
For some campuses, the options are not so clear cut. James Milroy, SUNY College at Geneseo vice president for administration and finance, said liberal arts colleges must weigh options and decide which part of their mission to emphasize.
 
Research institutions already have spinoffs and collaborators, and community colleges are dedicated to workforce development, but comprehensive colleges do not have an obvious path, Milroy noted.
 
"The first role for us is to determine what types of businesses work well in furthering the mission," he said. "As a liberal arts college, we have to determine if we want to focus on the sciences or try to promote small business."
 
SUNY Geneseo officials began this process when the school applied for a NY SUNY 2020 grant for a small-business center. Milroy said they plan more discussions with local business groups and other stakeholders to get input.
 
SUNY College at Brockport also is looking closely into which businesses would fit with the campus and its mission.
 
"We have to make sure whatever opportunities we pursue or develop are in alignment with our academic mission or enhance our academic mission," said Beau Willis, the college's vice president of finance and advancement.
 
SUNY Brockport officials also are examining the possibilities for the college's downtown center, which may need an additional petition to be given the tax-free status. Willis added any decision would be made with the community input and agreement of host communities.
 
While there will be more work involved, SUNY Brockport officials said the program will open many opportunities for the campus.
 
"Start-Up NY is a bold initiative that will allow SUNY campuses to drive business investment and economic development throughout New York," said John Halstead, SUNY Brockport president. "The College at Brockport is eager to pursue opportunities aligned with our academic mission that will benefit our local community."
 
Colleges will have help in developing programs and selecting business partners, Kress said. She serves on the board of the SUNY Research Foundation, which is ready to provide technical assistance in creating templates and model agreements for campuses.
 
Though the program has won the support of local SUNY leaders-as well as private college leaders, including the University of Rochester president Joel Seligman-not all are in favor.
 
A Rochester Business Journal Snap Poll conducted in the third week of June found 78 percent of respondents opposed the measure.
 
But Kress sees the program differently, saying it would help level the playing field for New York businesses and campuses.
 
"As you look across the country, one deficit New York had against other states is the ability to provide benefits that places like North Carolina, Florida and Texas offer as a matter of course," Kress said. "This gives the state a real chance to stay in there and start up Upstate New York."

7/5/13 (c) 2013 Rochester Business Journal. To obtain permission to reprint this article, call 585-546-8303 or email service@rbj.net.
 


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