Incentives Deal of the Month
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New York Bulks Up Aid
for Big Apple Manufacturers
LYNE, Site Selection Executive Editor of Interactive Publishing
NEW YORK New
York City is intent on keeping its half-a million-job manufacturing
sector alive, well and contentedly inside the Big Apple.
Alper: 'Creating a Better Partnership With City's Many Industrial Companies'The centerpiece of New York's manufacturing push is the newly created Office of Industrial and Manufacturing Businesses (OIMB), part of the city's Department of Small Business Services (SBS at www.nyc.gov/html/sbs). The OIMB will manage the creation of the city's new Industrial Business Zones (IBZs) and will and oversee aid initiatives that include relocation tax credits and employee-training programs.
"Mayor Bloomberg's economic development strategy focuses on three key initiatives: making the city more livable, more business-friendly and diversifying our economy," said Andrew Alper, president of the New York City Economic Development Corporation (www.newyorkbiz.com). "Improving business conditions for our critical manufacturing sector touches on all three. This new policy will help us create a better partnership with the city's many industrial companies and create the proper conditions to catalyze job growth."
New York City is investing some $17 million in the manufacturing program through 2009, city officials said. During that same period, they explained, the Big Apple will provide about $9 million in projected
Some IBZs Already DesignatedThe OIMB's incentives will revolve around the IBZs. Those zones will replace the city's existing In-Place Industrial Parks program, an initiative that New York officials described as "outdated."
The IBZs will be designated, city officials explained in a release accompanying the program's announcement, "based on existing land uses, the industrial character of the neighborhood, traffic patterns and Empire Zone boundaries." (Companies locating and/or expanding in a state Empire Zone are eligible for sales tax exemption and real property and business tax credits for 10 to 15 years.)
The city has already identified some of the IBZs, reported Carl Hum, the newly appointed director of the OIMB. Neighborhoods in which zones have been established, he explained, include the following: Bathgate; East New York; Eastchester; Flatlands; Hunts Point; Jamaica; JFK Industrial Corridor; Long Island City; North Brooklyn; Port Morris; Southwest Brooklyn including Sunset Park and parts of Red Hook and Gowanus; Steinway; West Maspeth; and Zerega. Other IBZs will be designated, Hum said.
"Even with the challenges of a global economy and changing urban landscape, the industrial sector still manages to significantly contribute to the city's economy and provide gateway employment for many workers with minimal skills and limited English proficiency," said Hum, the former SBS chief of staff and special counsel. "The Office of Industrial and Manufacturing Businesses will not only help retain current businesses but help them grow and attract even more businesses to New York."
Tax Credits for IBZ RelocationsOIMB's help includes a tax credit for manufacturing companies that relocate to either an IBZ or to the Brooklyn Navy Yard. That one-time credit, city officials explained, would be geared toward firms that can't expand at their current locations. The subsidies would cover program-eligible relocation expenses of up to $1,000 for each relocated industrial job.
Other program initiatives will expand the city's services in helping companies recruit, screen and train employees, said Hum. The idea, he explained, is to help industrial businesses reduce labor costs and access employee-training funds.
The OIMB will offer $1 million in grants for industry-specific training programs or for special initiatives that bring services closer to industrial businesses, Hum said. The grants, he added, will also be offered for technical assistance to help industrial businesses access additional state training grants.
Arc Metal, which makes retail displays, architectural metal detail and custom furniture, is taking advantage of the city's existing manufacturing support programs in its expansion. The city's Industrial Development Agency (IDA at www.newyorkbiz.com/nycida) is providing $730,000 over 25 years to assist the company in buying the building it now leases. The aid which includes a mortgage recording tax waiver, and real estate and sales tax abatements will enable the company to expand and remain competitive with companies in less expensive locations, IDA officials explained.
Taking the Guesswork OutNew York's industrial push also addresses a persistent beef for city manufacturing firms: uncertainties about how present and potential future sites will be used. The Bloomberg administration is committed to not rezoning any part of an IBZ for residential use, the mayor said.
Of Future Zoning Decisions
"By making an ironclad commitment to maintain manufacturing zoning in key industrial areas and not
The city is also cracking down on illegal conversions of manufacturing space into housing, said Bloomberg. New York is now prominently promoting reporting such violations through its 311 phone hotline. In addition, the city is raising its fines for conversion-related infractions, New York officials said.
The city's new manufacturing support includes enhancing sanitation services, creating a new "dumpster shed" program. The city now offers its businesses the option of building a shed on the sidewalk to store dumpsters for trash disposal. But that program, city officials conceded, is "a lengthy, expensive and burdensome process" that takes a year to complete on average. The new plan, they promised, will lower costs and streamline processes, cutting the time to build a shed to six months.
Hum brings strong familial roots to the OIMB's mission.
"My connection to the industrial and manufacturing sector in the city runs deep," he explained. "I grew up in Sunset Park, Brooklyn, and my parents were both employed in the sector.
"My father pressed shirts in Greenpoint, Brooklyn, and my mother was a seamstress in Chinatown," Hum continued. "In fact, if it wasn't for these jobs, my sisters and I never would have been able to go to college and pursue our careers."
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