Tags: New York | startups | job creation | Forbes | Andrew Cuomo

Critics: New York State Job Creation Program Not Working

By    |   Thursday, 25 Jun 2015 05:57 PM

Critics say a program created by New York Gov. Andrew Cuomo last year with the goal of helping startup companies gain traction in the state is sputtering, but its supporters are urging them to have patience.

The program, called START-UP NY, set up tax-free zones in the state of New York for qualified startups to take advantage of. The companies would, according to the program's website, "operate tax-free for 10 years on or near eligible university or college campuses in New York State."

According to a Forbes report, however, the program is not doing much for the economy.

Last year, the new program created 76 jobs, which cost the state $697,368 per job, according to data cited by Forbes. An advertising campaign cost $150 million for the program, and another $50 million is due to be spent this year on marketing the program through ads.

"We open up the candy store and give away the candy rather than requiring companies to live up to their job creation promises," Fiscal Policy Institute spokesman Ron Deutsch told Forbes.

One supporter of the program, on the other hand, told Forbes it takes time for startups to either make enough or raise enough capital so that they're able to expand their businesses and hire more workers.

"It does not seem reasonable to think that job creation will happen overnight," Cornell University executive director of new venture advancement Tom Schryer said. "As they say, 'Rome wasn't built in a day.'"

When the program was introduced last year, critics said the claim of not having to pay taxes for 10 years isn't entirely true.

"This is a complicated program with extensive regulations and guidelines," attorney Kevin McAuliffe said at the time. "The benefits can be lucrative, but they will not necessarily eliminate all tax liability."

Leslie Whatley, START-UP NY's executive vice president, said last week the program is doing fine.

"When people say you go from nothing to gazillions overnight, I don't know what to say, because that's not how the real world works," Whatley told Capital New York.

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Critics say a program created by New York Gov. Andrew Cuomo last year with the goal of helping startup companies gain traction in the state is sputtering, but its supporters are urging them to have patience.
New York, startups, job creation, Forbes, Andrew Cuomo
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2015-57-25
Thursday, 25 Jun 2015 05:57 PM
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