8 colleges named tax-free zones under Start-Up NY

ALBANY – Eight colleges in New York are moving forward to partner with local and new businesses after their applications were approved last week for Gov. Andrew Cuomo's Start-Up NY initiative.

The Start-Up NY initiative will give approved companies who locate on campuses or within a one-mile radius of campuses tax exemptions for 10 years to create businesses and jobs that will align with the schools' core academic curriculum.

The eight colleges approved by the state were community colleges in Monroe, Onondaga and Ulster counties, as well as Cornell University in Ithaca and University of Buffalo. SUNY Albany, SUNY Downstate in Brooklyn and Stony Brook state University on Long Island were also approved for the program.

The colleges praised the initiative, saying it is leading to new interest in public-private partnerships on campuses. SUNY Ulster said it is looking for businesses interested in manufacturing, health care, computer networking and cybersecurity, advertising design and environmental services.

Donald Katt, president of SUNY Ulster, said the college has already met with 12 interested businesses. Other colleges said they received interest from dozens of companies.

"We're very excited about the program because a part of our mission is we are really pledging to help in the economic vitality of our county, and we have been doing that principally through our small business development center," Katt said. "This new program will give us an opportunity to impact even more in attracting new businesses and expanding businesses to consider locating in Ulster County."

The program launched in October to help the state's economy after it was approved by the state Legislature last June. Applications were first reviewed in January. Cuomo has touted the program as a way to entice new businesses to New York, which is among the highest-taxed states in the country.

The state is spending taxpayers' money on ads running across the country to promote the program.

"In a tax-free environment, no one can match what New York has to offer," Cuomo said in a statement during the October launch. "Businesses that are looking to start up or expand, and most importantly create jobs, should look no further."

The program, however, has been controversial. Existing businesses have expressed concern that the new companies will have an unfair advantage.

A major Start-Up plan announced so far has been to open a film-production house near Syracuse.

Brian Sampson, executive director of Unshackle Upstate, a Rochester-based business group, said the program is a step in the right direction, but is flawed and doesn't address the larger problems for businesses in the state.

The business group would have preferred the state lower property taxes, without a property tax freeze or circuit breaker system like Cuomo proposed in his executive budget in January, and completely overhaul the workers' compensation system.

"Do we agree with all the components [of Start-Up NY]? No. Do we think it is appropriate that employees on one location pay state income taxes, but another they don't? No, we don't, but until New York elected officials make a determination that New York is not going to have the worst business climate then we have to incentivize them."

If accepted into the initiative, businesses will operate with no income tax, business tax, corporate tax, state taxes, local taxes, sales tax, property tax and franchise fees for 10 years. To be eligible, businesses must create new jobs in the first year. Higher-paid workers would have to pay income taxes after five years.

Cornell University in Tompkins County was approved for 36,000 square feet and 81 acres on campus of tax-free space, as well as 79,000 square feet off campus. The university's core academic areas are agriculture, energy, high tech, human and veterinary medicine and sustainable technology.

Cornell University has had over 24 businesses already inquire about their Start-Up program, college officials said.

Mary Opperman, vice president for human resources and safety services at Cornell University and the Start-Up director at the university, said the initiative will create opportunities between students and businesses that could lead to internships and hopefully jobs.

"We really think this is a great way to highlight our community and the Southern Tier region and upstate, in general," Opperman said. "Maybe Start-Up is the answer [to the economic problems in upstate], maybe Start-Up will just open the door for a company to come and look at Ithaca or Tompkins County and the Southern Tier, but it really is the beginning of a dialogue."

SUNY Ulster does not have the space for businesses to move onto campus, so from the beginning they anticipated leasing privately-owned facilities from within a mile of the campus or at its campus extension center in Kingston.

The former IBM site near Kingston, now known as Tech City, has been considered by SUNY Ulster as a potential site. Katt said the college hopes to have six or more businesses approved and launched in Ulster County by the summer.

Monroe Community College's Start-Up program calls for targeting specific types of businesses: information systems, computing, optics, allied health, agriculture, homeland security and advanced manufacturing industries.

Empire State Development Corp., the state's economic-development arm, approved 130,343 square feet of building space and 34 acres of undeveloped land on campus at the new MCC building in downtown Rochester and within MCC's property in Brighton and Henrietta.

"It's a wonderful opportunity to bring new companies into the area and grow jobs, especially middle-skilled jobs," said Diane Cecero, MCC's general counsel. "We're hoping that it will help the economy that way and, of course, extra opportunities for our graduates."

MCC has had about 20 to 25 businesses make initial inquiries about the Start-Up program.

For more information on the Start-Up NY program, visit startup-ny.com