While I often get comments on my monthly Rochester Business Journal columns, I was amazed by the amount of feedback I received for last month’s column about my recent visit to Greenville, S.C., and Alpharetta, Ga.
I received some very passionate input from people who love Rochester and the Finger Lakes region but have moved out and found much greener pastures elsewhere. The comments from these people consistently said that they miss our region and would love to come back if the business climate could match the one that they now experience in the South.
To briefly recap, last month’s column explored why some southern states are seeing explosive growth while Upstate New York still struggles in comparison to our downstate neighbors. It is simply a different economic climate here inhibited by taxes and regulatory issues put into place by our state and local governments over decades. These issues may have some value downstate but have really helped to drive people out of upstate. We need to turn this around.
We at Rochester Chamber consistently hear from members that taxes and regulations are some of the most daunting things they face doing business in New York. To reduce taxes, there has to be a reduction in spending. You can’t have it both ways.
To determine the best areas to cut, legislators must work together to find the proper balance. There are no cuts that will not have a corresponding negative reaction and protests attached to them. Yes, these are difficult decisions. However, with a thoughtful effort on behalf of elected officials, business leaders and other community leadership, we can achieve spending cuts that lead to a lessening of the tax burden.
Upstate also has some of the highest property taxes in the nation, even with the state’s 2 percent cap in place. People are paying in essence an extra mortgage payment just to pay the property taxes on their homes and businesses. As people near retirement, they make decisions to move elsewhere in order to avoid taxes and maintain their quality of life.
In Georgia alone, seniors are afforded significant property tax exemptions. Some southern states make these decisions based upon the fact that they want retirees to go there. We can stop people fleeing for the South by making it more financially agreeable for them to stay. Yes, the South has warmer weather, but I’m sure many would be very reluctant to trade our four beautiful seasons if they could better afford to stay here. Reducing costs, especially for working families, seniors and businesses, will have a corresponding positive impact.
The current stagnation may result from the fact that certain things that upstate needs may not sit well with our downstate leaders and their constituents. That’s why I go back to a point that I have made repeatedly: We need more regionalized legislation.
Legislators started down that path with the split minimum wage law. More can be done in this same vein that acknowledges the difference between the upstate and downstate economies. Gov. Andrew Cuomo led the push for our current property tax cap and has also instituted a number of tax reductions. We need to keep pushing the needle forward.
I urge our legislators to work with business owners to review the current regulatory climate and impediments upstate and try to work collaboratively on ways that we can begin to address some of those longstanding issues. It would be helpful if the state formed a task force involving upstate business leaders to determine the biggest challenges they face. Greater Rochester Chamber of Commerce will gladly help facilitate such a task force representing the Finger Lakes region.
From my previous careers in government to my current position as Greater Rochester Chamber of Commerce CEO, I have found that the best way for me to learn is to go out and visit company leaders face to face. My Rochester Chamber team and I do this consistently week to week. I have learned an enormous amount from business leaders and their teams on what they want to see happen to improve the upstate climate and keep them and the jobs they create here.
Company visits from elected officials often center on ribbon cuttings, photo ops and fundraising. They need to be about engaging the men and women who create jobs and fuel our economy. This is especially true for our small and medium-sized businesses. They need to be asked, “What can we do to support you?”
The answers are not that complex. Again, they come down to taxes, regulatory issues and other financial pressures that each year push them closer to the breaking point. We want to move away from the breaking point. A true listening tour of upstate businesses is a solid first step in formulating solutions.
I’ll close by reiterating my point that the most expeditious way to regionalize our Upstate New York economy and make it a place where businesses and families want to come and stay is with a two-tiered system for state legislation. This system should be region-appropriate and focused on growing our economy by eliminating the impediments to our future success.
Robert J. Duffy is president and CEO of Greater Rochester Chamber of Commerce. Contact him at rduffy@GreaterRochesterChamber.com.
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