Public Hearing - February 09, 2023

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 2  ----------------------------------------------------


 4             In the Matter of the
          2023-2024 EXECUTIVE BUDGET ON
 6  ----------------------------------------------------

 7                              Hearing Room B 
                                Legislative Office Building
 8                              Albany, New York 
 9                              February 9, 2023
                                9:37 a.m.


12            Senator Liz Krueger
              Chair, Senate Finance Committee
              Assemblywoman Helene E. Weinstein
14            Chair, Assembly Ways & Means Committee

16            Senator Thomas F. O'Mara 
              Senate Finance Committee (RM)
              Assemblyman Edward P. Ra 
18            Assembly Ways & Means Committee (RM)
19            Senator Sean M. Ryan
              Chair, Senate Committee on Commerce, 
20             Economic Development and Small Business  
21            Assemblyman Harry B. Bronson 
              Chair, Assembly Committee on Economic 
22             Development, Job Creation, Commerce 
               and Industry 
              Senator José M. Serrano
24            Chair, Senate Committee on Cultural Affairs,
                Tourism, Arts and Recreation


 1  2023-2024 Executive Budget
    Economic Development
 2  2-9-23
 3  PRESENT:  (Continued)
 4            Assemblyman Al Stirpe
              Chair, Assembly Committee on Small Business
              Senator Jeremy A. Cooney
 6            Chair, Senate Committee on Procurement 
                and Contracts
              Assemblyman Daniel J. O'Donnell
 8            Chair, Assembly Committee on Tourism, Parks, 
               Arts and Sports Development
              Assemblyman J. Gary Pretlow
10            Chair, Assembly Committee on Racing and Wagering
11            Senator Kristen Gonzalez
12            Assemblyman Steven Otis
13            Senator John Liu
14            Assemblyman Billy Jones
15            Senator Michelle Hinchey
16            Assemblyman Christopher S. Friend
17            Senator George M. Borrello
18            Assemblywoman Carrie Woerner
19            Assemblyman Charles D. Fall
20            Assemblywoman Patricia Fahy
21            Senator Mark Walczyk
22            Assemblywoman Yudelka Tapia
23            Senator Peter Oberacker
24            Assemblyman John T. McDonald III


 1  2023-2024 Executive Budget
    Economic Development
 2  2-9-23
 3  PRESENT:  (Continued)
 4            Assemblyman Jonathan Rivera
 5            Senator Dean Murray
 6            Assemblywoman MaryJane Shimsky
 7            Assemblyman John Zaccaro, Jr.
 8            Assemblyman William Colton
 9            Assemblyman Scott Gray
10            Assemblyman Brian Cunningham
11            Assemblyman Erik M. Dilan
12            Assemblywoman Chantell Jackson
13            Assemblyman Kenneth Zebrowski
14            Assemblywoman Jo Anne Simon
15            Assemblyman Tony Simone
16            Assemblywoman Nikki Lucas
17            Assemblyman Brian Manktelow
18            Assemblyman John W. McGowan
19            Assemblyman Ari Brown
20            Assemblyman Brian Maher





 1  2023-2024 Executive Budget
    Economic Development
 2  2-9-23
 3                     LIST OF SPEAKERS
 4                                      STATEMENT  QUESTIONS
 5  Hope Knight
 6  NYS Department of Economic
 7  President & CEO 
    Empire State Development                 
 8       -and-
    Jeanette Moy
 9  Commissioner            
    NYS Office of General Services
10  (OGS)                          
11  Mara Manus
    Executive Director
12  NYS Council on the Arts                 12         36
13  Ryan Silva
    Executive Director
14  NYS Economic Development Council
15  Ross A. Frommer
    VP, Government & Community Affairs
16  Columbia University Irving
     Medical Center
17       -on behalf of-
    NYFIRST, Fund for Innovation in
18   Research & Scientific Talent
19  Associated Medical Schools of
     New York                               214          221




 1  2023-2024 Executive Budget
    Economic Development
 2  2-9-23
 3                     LIST OF SPEAKERS, Continued 
 4                                        STATEMENT  QUESTIONS
 5  Ron Deutsch
 6  New Yorkers for 
     Fiscal Fairness
 7       -and-
    Elizabeth Marcello
 8  Senior Research Analyst
    Reinvent Albany
 9       -and-
    Michael Kink
10  Executive Director
    Strong Economy for All 
11   Coalition                                259        269
12  John Scheib
13  Scheib Associates
14  David O'Rourke
    CEO and President
15  New York Racing Association,
     Inc. (NYRA)                             287        293
    Stephanie Johnson Cunningham
17  Executive Director
    Museum Hue                                311        315
    Jennifer Myers 
19  Field Representative
    Motion Picture Editors Guild, 
20   IATSE Local 700 
21  Deirdra Govan
    Vice President
22  United Scenic Artists, 
     Local USA 829, IATSE
23       -and-
    Tim Clark
24  Film Commissioner
    Buffalo Niagara Film Office             318        329


 1                  CHAIRWOMAN KRUEGER:  Good morning.  

 2           Hi, everyone.  If the first panel could take 

 3           their seats at the table.  Okay, thank you.  

 4           As soon as they get here, I'll start with the 

 5           opening comments and instructions for our 

 6           day.

 7                  Good morning.  I am Liz Krueger, chair 

 8           of the Senate Finance Committee, and I am 

 9           cohosting -- excuse me, cochairing.  I feel 

10           like we're hosting, but we're actually 

11           chairing -- cochairing the budget hearings 

12           with Helene Weinstein, the chair of Ways and 

13           Means in the Assembly.

14                  Today is the fourth of 13 hearings 

15           conducted by the joint fiscal committees of 

16           the Legislature regarding the Governor's 

17           proposed budget for the state fiscal year 

18           '23-'24.

19                  These hearings are conducted pursuant 

20           to the New York State Constitution and 

21           Legislative Law.

22                  Today the Senate Finance Committee and 

23           Assembly Ways and Means Committee will hear 

24           testimony concerning the Governor's proposed 


 1           budget for the New York State Empire State 

 2           Development Authority, the New York State 

 3           Office of General Services, and the New York 

 4           State Council on the Arts.

 5                  Following each testimony there will be 

 6           some time for questions from the chairs of 

 7           the relevant committees.

 8                  I will now introduce members from the 

 9           Senate, and Assemblymember Helene Weinstein, 

10           the chair of Ways and Means, will introduce 

11           members from the Assembly.  In addition, the 

12           rankers of the two committees will introduce 

13           their members afterwards.  

14                  And of course I already forgot to get 

15           a list of who's here, so one second, I want 

16           to make sure.  Good -- Helene's going to 

17           start with the Assembly.  

18                  CHAIRWOMAN WEINSTEIN:  So for the 

19           Assembly we have the chair of our Economic 

20           Development Committee, Assemblyman Bronson; 

21           chair of our Small Business Committee, 

22           Assemblyman Stirpe.  We have Assemblyman 

23           Cunningham, Assemblyman Dilan, Assemblywoman 

24           Jackson, Assemblyman Jones, Assemblyman 


 1           McDonald, Assemblyman Rivera, Assemblywoman 

 2           Simon, Assemblyman Simone, Assemblywoman 

 3           Tapia, Assemblyman Zebrowski, Assemblyman 

 4           Otis, and Assemblyman Pretlow, chair of our 

 5           Racing Committee.

 6                  Mr. Ra, would you -- Assemblyman Ra, 

 7           please introduce your colleagues.

 8                  ASSEMBLYMAN RA:  Thank you.  

 9                  Good morning.  We are joined by 

10           Assemblyman Friend, who is our ranker on 

11           Economic Development; Assemblyman Gray, our 

12           ranker on Tourism; Assemblyman McGowan, our 

13           ranker on Small Business; as well as 

14           Assemblymembers Manktelow and Maher.

15                  CHAIRWOMAN WEINSTEIN:  Now to the 

16           Senate.  

17                  CHAIRWOMAN KRUEGER:  Good.  We've 

18           figured ourselves out, thank you.  

19                  I am joined by Senator Sean Ryan, 

20           Senator Jeremy Cooney, Senator Michelle 

21           Hinchey, Senator -- excuse me, Senator 

22           Serrano, Senator Liu.  I think that's who's 

23           here so far.  And other Senators and 

24           Assemblymembers may come in, and we will 


 1           introduce them then.  

 2                  Tom O'Mara, ranker for Finance, would 

 3           you introduce your members?

 4                  SENATOR O'MARA:  Yes, thank you, 

 5           Chairwoman.  

 6                  We're joined on our side by 

 7           Senator Mark Walczyk, the ranker on Tourism; 

 8           Senator Dean Murray, our ranker on Economic 

 9           Development; and Senator Peter Oberacker.

10                  CHAIRWOMAN KRUEGER:  Great.  

11                  I just want to, for those of you who 

12           haven't been coming every day, to lay out 

13           sort of the rules of all our hearings.  For 

14           governmental witnesses, you get to present 

15           for 10 minutes each.  Then we'll open it up 

16           to questions of the entire panel, so any of 

17           you might be asked questions by any of the 

18           legislators.  

19                  Chairs Weinstein and Krueger and 

20           relevant committee chairs get 10 minutes of 

21           questions with government reps.  Rankers get 

22           five minutes.  Only chairs get a second round 

23           of three minutes.  And all other members get 

24           three minutes only for the panel.


 1                  It is important to let Helene or 

 2           myself or our rankers know if you want to be 

 3           on the list to ask questions, because we 

 4           won't know otherwise to put you on the list.

 5                  For nongovernmental witnesses, when we 

 6           get to them in later panels, all members get 

 7           three minutes to ask questions and they get 

 8           only three minutes to present.

 9                  We have everyone's testimony 

10           electronically.  It's online.  Everyone, you 

11           in the audience, the public at large, can all 

12           have access to the testimony.  So we urge 

13           everyone who testifies to remember you have 

14           very limited time.  Highlight your key 

15           points.  Don't read your testimony.  

16           Sometimes people hand in 15 pages of 

17           testimony and then we go, You don't think 

18           they're really going to try to read it, 

19           right?  And sometimes they try.  And guess 

20           what?  It doesn't work.

21                  So highlight your key points.  Don't 

22           expect you're going to read your full 

23           testimony.  But we have it, and we can read 

24           it.  And also you can read more quickly than 


 1           people talk, so it's amazing how much you can 

 2           get through if you're reading the testimony 

 3           while somebody's presenting.

 4                  Again, there are no PowerPoints, 

 5           presentations, or placards or signs permitted 

 6           in the hearing room by guests, presenters, or 

 7           legislators.  Okay?  So some people get a 

 8           little confused at that, but we try to keep 

 9           these hearings moving professionally and in a 

10           timely manner, although I think we were here 

11           till 9 o'clock last night.

12                  Today our first presentations will be 

13           by Hope Knight, commissioner of the New York 

14           State Department of Economic Development and 

15           the Empire State Development Authority; 

16           Jeanette Moy, commissioner of the New York 

17           State Office of General Services; and 

18           Mara Manus, executive director of the 

19           New York State Council on the Arts.  

20                  And again, after they have presented, 

21           there will be opportunities to question them.  

22           And I'd like to start with Hope Knight.

23                  Good morning.  

24                  COMMISSIONER KNIGHT:  Thank you.  Good 


 1           morning.  Chairwoman Krueger, Chairwoman 

 2           Weinstein, and distinguished members of the 

 3           State Legislature, my name is Hope Knight, 

 4           and I serve as the president and CEO of 

 5           Empire State Development and as commissioner 

 6           of the New York State Department of Economic 

 7           Development.  

 8                  I am joined by our chief operating 

 9           officer, Kevin Younis.  

10                  Thank you for the invitation to 

11           discuss Governor Hochul's 2024 Executive 

12           Budget.  

13                  Over the past year, I've had the 

14           pleasure to work with many of you to support 

15           effective and transparent economic 

16           development across the state.  And in these 

17           uncertain economic times, I am proud of what 

18           we have accomplished.  We have been 

19           laser-focused on supporting small businesses, 

20           especially in the wake of the pandemic. 

21                  Thanks to the Governor's small 

22           business assistance programs, more than 

23           50,000 small businesses, including minority 

24           and women-owned businesses, have received 


 1           support from ESD over the past two years.  

 2           This direct support, combined with the 

 3           resiliency of New York entrepreneurs, has 

 4           resulted in the number of small businesses 

 5           growing by 20,000 since 2020.  

 6                  Governor Hochul has also secured one 

 7           of the largest economic agreements in U.S 

 8           history when Micron chose Central New York 

 9           for its $100 billion semiconductor facility. 

10           The project is expected to create nearly 

11           50,000 jobs statewide, including 9,000 new 

12           high-paying Micron jobs with average salaries 

13           exceeding $100,000.  

14                  Under the Governor's leadership, we 

15           also launched the Office of Strategic 

16           Workforce Development.  This marked a 

17           decisive shift in the state's workforce 

18           development strategy by aligning training 

19           with the needs of employers, especially those 

20           in growth industries.  The office's first 

21           round of awards is supporting nearly 3,000 

22           trainees for jobs with more than 100 business 

23           partners.  

24                  I am also proud of what we've done to 


 1           make ESD even more transparent and 

 2           accountable.  We recently expanded the 

 3           Database of Economic Incentives from 26 to 

 4           52 fields, informed by input from the 

 5           Legislature and good government groups.  The  

 6           database now includes additional --

 7                  CHAIRWOMAN KRUEGER:  I'm sorry, Hope, 

 8           people are having a little trouble hearing.  

 9           Can you pull that mic a little closer to you?

10                  COMMISSIONER KNIGHT:  Sure.

11                  The database now includes additional 

12           information about jobs, MWBE utilization, and 

13           IDA support.  Today it's one of the leading 

14           databases in the country for economic 

15           development.  

16                  As we look ahead, New York is finally 

17           emerging from a pandemic that has weighed on 

18           the state's economy for almost three years. 

19           While some economic challenges linger, 

20           indicators show that New York is ready for an 

21           economic resurgence.  We're seeing job growth 

22           across the state as unemployment has declined 

23           to 4.3 percent.  

24                  This year we have an opportunity to 


 1           shift the state's focus from recovery to 

 2           growth.  Governor Hochul's Executive Budget 

 3           aims to spur new, inclusive economic 

 4           development by strengthening our business 

 5           communities and helping all New Yorkers 

 6           achieve the New York dream.  

 7                  The arrival of Micron in Central 

 8           New York will require collaboration across 

 9           industry and community partners.  The new 

10           Governor's Office of Semiconductor Expansion, 

11           Management, and Integration, or GO SEMI, will 

12           assist with regional planning efforts to 

13           ensure smart growth and cohesive development.  

14           The office will also support the expected 

15           growth of semiconductor and supply chain 

16           companies across the state.  

17                  New York's life science sector 

18           continues to thrive, with a 10 percent 

19           increase over the last five years.  More than 

20           100,000 New Yorkers now work in this 

21           high-growth industry.  The Governor's 

22           announcement of two cell and gene therapy 

23           hubs, one upstate and one downstate, will 

24           drive life-saving research and create even 


 1           more high-paying jobs.  Cell and gene therapy 

 2           sales are expected to grow more than 

 3           800 percent by 2026.  By leaning into 

 4           strategic investments at this crucial stage, 

 5           New York will be securing its place as an 

 6           industry leader.  

 7                  The Governor's budget also provides 

 8           matching grant funding to attract federal 

 9           research dollars to New York.  These will go 

10           to small businesses applying for a portion of 

11           the billions in federal grants offered 

12           through the Small Business Innovation 

13           Research and Small Business Technology 

14           Transfer programs.  These matching grants 

15           will help our small businesses develop and 

16           commercialize groundbreaking technology right 

17           here in New York.  

18                  The Executive Budget also includes the 

19           Extended Prosperity and Innovation Campuses 

20           initiative, or EPIC, to support new business 

21           growth around the state's educational 

22           centers.  EPIC will improve on its START-UP 

23           NY predecessor.  For the first time, upstate 

24           and downstate locations will have the same 


 1           requirements, benefits, and eligibility 

 2           criteria.  It will also support a wider range 

 3           of businesses and increase the amount of 

 4           eligible space dedicated to growing 

 5           innovation and creating jobs.  

 6                  The Governor is also working to remove 

 7           barriers for MWBEs.  We have made significant 

 8           improvements to our certification process, 

 9           and the Executive Budget directs the state to 

10           pursue certification reciprocity with other 

11           certifying organizations.  This process will 

12           cut red tape for applicants and allow more 

13           MWBEs to participate in contracting 

14           opportunities.  

15                  We are also making an unprecedented 

16           commitment to the film and television 

17           industry.  Film productions have a 

18           compounding economic effect that make this 

19           sector particularly valuable by supporting 

20           jobs and small businesses, and generating 

21           revenue at the state and local level.  The 

22           increased Film Tax Credit will make us 

23           competitive with other states and encourage 

24           more productions to choose New York.  


 1                  All told, this is a bold agenda.  I am 

 2           proud of the progress we have made together, 

 3           and I look forward to continuing to work 

 4           closely with all of you to deliver for 

 5           New Yorkers.  

 6                  Thank you for the opportunity to speak 

 7           this morning, and I look forward to taking 

 8           your questions.  

 9                  CHAIRWOMAN KRUEGER:  Thank you.  

10                  The next testifier is the commissioner 

11           of OGS.

12                  OGS COMMISSIONER MOY:  Greetings, 

13           Chairs Krueger and Weinstein, Ranking Members 

14           O'Mara and Ra, and distinguished members of 

15           the Legislature.  

16                  My name is Jeanette Moy, and I'm the 

17           commissioner of the New York State Office of 

18           General Services.  I'm joined today by OGS 

19           Executive Deputy Commissioner Thomas Detito.  

20                  Thank you for the opportunity to share 

21           the work of this agency and all the items 

22           that have been accomplished since I last 

23           testified before the Legislature, as well as 

24           to discuss the impact of the Governor's 


 1           Executive Budget on OGS.  

 2                  The Governor's Executive Budget 

 3           proposes $1.3 billion for OGS, which will 

 4           enable our agency to continue to support her 

 5           commitment to improve government operations 

 6           and service for all New Yorkers.  OGS 

 7           provides critical shared services and often 

 8           unseen work for the state, from managing 

 9           capital projects to administrative services 

10           to logistics and warehousing support.  This 

11           budget allocation enables OGS and its 

12           1,800 employees to provide operational 

13           support for state agencies so that they can 

14           focus on delivering on their core missions 

15           effectively and efficiently.  

16                  Our work also supports local 

17           governments, not-for-profits, businesses, and 

18           individual New Yorkers.  Our cultural 

19           programs and careful conservation of assets 

20           provide New Yorkers with access to our 

21           historic Capitol building and our extensive, 

22           world-class art program.  OGS's 

23           accomplishments are New York State's success 

24           stories.  A properly funded and fully staffed 


 1           OGS can ensure the fulfillment of Governor 

 2           Hochul's promise to make government more 

 3           accessible, transparent, diverse, resilient, 

 4           and responsive to New Yorkers' needs.  

 5                  In the coming year, OGS will lead 

 6           several initiatives announced in the 

 7           Governor's 2023 State of the State.  First, 

 8           we will implement eProcurement, bringing our 

 9           systems in line with industry standards.  New 

10           York is the last large state without an 

11           e-procurement system.  We need realtime 

12           access to dynamic data so that we can quickly 

13           respond to market changes, reduce the time 

14           for users to find and purchase goods and 

15           services, and better manage the state's 

16           procurement spend.

17                  Second, we will pilot new office 

18           designs.  The COVID-19 pandemic has 

19           normalized hybrid work, and our state needs 

20           flexible spaces that meet the needs of an 

21           increasingly distributed workforce. 

22                  Third, we will expand our digital and 

23           media services center to deliver more 

24           customer-oriented, user-friendly digital 


 1           products and services, and better connect 

 2           state agencies with New York businesses and 

 3           residents.  These projects will help us to 

 4           improve state outcomes and advance the 

 5           Governor's agenda.

 6                  I would also like to take this time to 

 7           reflect on OGS's successes.  This year we 

 8           have worked to implement key State of the 

 9           State commitments.  At Governor Hochul's 

10           direction, and with the support of this 

11           Legislature, OGS launched the Office of 

12           Language Access, which is the second office 

13           of its kind in the United States.  There are 

14           over 5.7 million New Yorkers who speak a 

15           language other than English, 2.5 million of 

16           whom are limited English proficient.  We 

17           worked with agencies, vendors and 

18           community-based organizations to ensure that 

19           the language access law is implemented 

20           effectively.

21                  To meet the Governor's ambitious 

22           climate goals and support the necessary state 

23           changes to state operations, OGS established 

24           its Office of Resiliency and Stability.  This 


 1           new team is implementing many of the 

 2           Governor's key priorities, in partnership 

 3           with DEC, NYSERDA, NYPA, and more.  We are 

 4           driving the conversion of the state's 

 5           light-duty fleet to zero-emission vehicles by 

 6           2035, and facilitating the build-out of 

 7           essential fleet charging infrastructure.

 8                  We have convened a Zero-Emission 

 9           Vehicle Conversion Interagency Working Group 

10           to identify opportunities, barriers and 

11           innovations while establishing multiple 

12           streamlined procurement mechanisms for 

13           rapidly expanding the EV charging 

14           infrastructure.

15                  OGS is the co-lead of the GreenNY 

16           Council, which oversees the development of 

17           guidelines and reporting of the state's 

18           stability plan.  We developed and implemented 

19           the rollout for Executive Order 22, managed a 

20           Virtual Power Pilot program, working with 

21           NYPA, and participated in efforts to shape 

22           Environmental Bond Act projects, extreme heat 

23           emergency planning, and agency vulnerability 

24           assessments.


 1                  And finally, thanks to Governor Hochul 

 2           and the Legislature, OGS began work on the 

 3           $175.5 million infrastructure package to 

 4           address critical Empire State Plaza 

 5           infrastructure needs, including health and 

 6           safety issues, electrical and conveyance 

 7           systems, and structural repairs.  The package 

 8           also helps us to target the substantial 

 9           deferred maintenance in our portfolio.  This 

10           year we began work on the design for the 

11           restoration of the Capitol's eastern 

12           approach, and construction on the Capitol 

13           roof and the Hawk Street passage.  These 

14           projects will bring necessary improvements to 

15           some of the most prominent public spaces in 

16           our State Capitol.  

17                  Now, these initiatives were natural 

18           complements to OGS's already expansive 

19           portfolio.  OGS manages and maintains 

20           20 million square feet of the state's real 

21           property.  We manage the daily operations of 

22           150 state-owned buildings and structures 

23           totaling 7 billion in assets, serving 

24           approximately 30,000 tenants and thousands of 


 1           visitors.  

 2                  Our leasing portfolio includes 468 

 3           leases, over 12 million square feet 

 4           statewide.  This year we've responded to 

 5           emergencies from floods, fires, burst pipes, 

 6           snowstorms, credible thefts, and more.  But 

 7           through it all, our doors have remained open 

 8           for the state's workforce.

 9                  OGS also provides design, build, 

10           construction, and project permitting services 

11           to over 50 state agencies and clients, with a 

12           current workload of 1.4 billion in active 

13           construction projects, and another 2 billion 

14           in design development.  This year's successes 

15           have included the completion of the Office of 

16           Victim Services sexual offender evidence kit 

17           storage building, the replacement of 104 road 

18           salt storage structures for the Department of 

19           Transportation, and the federally funded 

20           construction of the New York State Police 

21           Station in Fredonia.

22                  We began construction on the highly 

23           anticipated Adirondack Rail Trail between 

24           Tupper Lake and Lake Placid for the 


 1           Department of Environmental Conservation, and 

 2           we've worked alongside the Division of 

 3           Military and Naval Affairs towards the 

 4           completion of 43 capital construction 

 5           projects, which will make significant 

 6           improvements to New York's Army National 

 7           Guard facilities and support troop readiness.  

 8                  OGS has been the central office for 

 9           processing human resources and financial 

10           transactions across the state through its 

11           Business Services Center.  This year we 

12           provided financial services to 66 executive 

13           agencies, processing over 12.6 billion in 

14           invoices alone, and HR benefits, payroll 

15           records, and time and attendance services for 

16           55 agencies with nearly 44,000 individual 

17           customers.

18                  Our procurement team contracts to 

19           procure goods and services at the best value 

20           for New York State taxpayers, encompassing 

21           30 billion in annual spend, over 8,000 

22           government entities, including 4500 towns, 

23           cities, counties, municipalities, 108 SUNY 

24           and CUNY campuses, and over 700 school 


 1           districts, not-for-profits, public 

 2           authorities, and public benefit corporations 

 3           leverage our centralized contracts.

 4                  This past year we worked to deliver 

 5           more inclusive cultural events and programs 

 6           that showcase New York's diversity, including 

 7           our annual Dr. Martin Luther King, Jr., Day 

 8           observance, our second annual Lunar New Year 

 9           celebration, new exhibits from the Harlem Art 

10           Collection to celebrate Hispanic Heritage 

11           Month, and the New York State chief diversity 

12           officer's inaugural Disability Rights and 

13           Employment Awareness Month, or DREAM, 

14           symposium.

15                  We've prioritized bringing New Yorkers 

16           together in as safe a manner as possible, 

17           through cultural programs and events, because 

18           it is a part of our educational and cultural 

19           charge as an agency.

20                  And finally, one of my key priorities 

21           for this year has been to strengthen the 

22           foundations of OGS, including our people, 

23           processes, and technology.  We need to hire, 

24           recruit, develop and retain the best talent 


 1           in order to be successful.  We must work 

 2           efficiently and get the best possible 

 3           outcomes from our vendors to advance the work 

 4           of the state.  We are focused on helping our 

 5           customers get better outcomes, whether it's 

 6           addressing fluctuating fuel costs or 

 7           constructing a more energy-efficient office.  

 8                  Providing good customer service is not 

 9           easy, nor is it a luxury.  It requires our 

10           team to measure our performance both 

11           qualitatively and quantitatively, because you 

12           cannot manage what you cannot measure.  To 

13           that end, we've created new offices for 

14           project management and strategy to support 

15           our efforts to improve our business systems 

16           and track agency performance, in partnership 

17           with OGS business units, ITS, project 

18           management and technology support teams.  I 

19           firmly believe that these strategic efforts 

20           will help us establish a foundation of 

21           transparency, collaboration, responsible 

22           stewardship, and consistent project success 

23           across OGS.

24                  Thank you for inviting me to provide 


 1           testimony today.  I now turn it back to Chair 

 2           Krueger and Chair Weinstein and am looking 

 3           forward to taking your questions.

 4                  CHAIRWOMAN KRUEGER:  Thank you very 

 5           much.

 6                  And our last speaker on this panel, 

 7           Mara Manus, from the New York State Council 

 8           on the Arts.

 9                  NYSCA EXEC. DIR. MANUS:  Thank you so 

10           much, Chairs Krueger and Weinstein and 

11           members of the committee, and welcome to our 

12           newly elected legislators. 

13                  I am Mara Manus, the executive 

14           director of the New York State Council on the 

15           Arts, also known as NYSCA.  On behalf of our 

16           chair, Katherine Nicholls, our council 

17           members, our staff, and our vibrant nonprofit 

18           arts and culture sector, we are immensely 

19           grateful to Governor Hochul and the State 

20           Legislature for your historic and 

21           unprecedented investment in 2023.  We are 

22           also grateful for Governor Hochul for an 

23           additional suballocation of $100 million in 

24           capital.  All of this affirms our state as a 


 1           global economic leader of arts and culture, 

 2           and our sector as the number-one driver of 

 3           tourism to our state.  

 4                  Arts and culture are an essential part 

 5           of our economic and human infrastructure.  In 

 6           fact, "We are on the verge of a cultural 

 7           shift in which arts can deliver potent, 

 8           accessible, and proven solutions for the 

 9           well-being of everyone."  Communities with 

10           strong cultural assets show improved outcomes 

11           in education, mental health, public safety, 

12           and civic engagement -- all of which continue 

13           to play important roles in our state's 

14           recovery and overall health.  

15                  According to the most recent NEA/BEA 

16           report, New York's vast creative economy 

17           contributed $126 billion annually, 

18           constituted 7 percent of the state's economy, 

19           and comprised of over 435,000 workers.  NYSCA 

20           is currently supporting a creative economy 

21           study of nonprofit arts organizations outside 

22           of New York City, focusing on the years 

23           between 2009 and '19.  Ahead of the report's 

24           release in the spring of 2023, we are able to 


 1           share with you that, one, statewide 

 2           employment in the arts and culture sector 

 3           grew almost 30 percent in the decade prior to 

 4           the pandemic, nearly double the state's 

 5           overall rate of job growth; and two, that the 

 6           upstate New York artist/designer population 

 7           jumped 27 percent over the past decade, 

 8           outpacing total population growth in nearly 

 9           every major city in the state.  

10                  That said, the COVID-19 pandemic has 

11           had a significant impact on the arts, which 

12           were one of the first sectors to close and 

13           one of the last to reopen.  The funding that 

14           the Governor and Legislature have provided 

15           over the last two years has been critical to 

16           the sector's recovery.  

17                  NYSCA's primary work is grant making 

18           to nonprofit arts and culture organizations 

19           and artists.  Our funding reaches over 3,000 

20           artists and organizations across all 62 

21           counties of our state.  These include the 

22           Adirondack Experience in Blue Mountain Lake, 

23           which offers 40,000 square feet of cultural 

24           exhibitions for over 50,000 visitors 


 1           annually; the Everson Museum in Syracuse, the 

 2           first museum in the world to be designed by 

 3           I.M. Pei; and Buffalo String Works, a small 

 4           CBO organization which provides music 

 5           education to youth from refugee and immigrant 

 6           communities.  

 7                  Over the last two years, NYSCA 

 8           reconceived our application process with one 

 9           primary goal: to create greater access to our 

10           funding while prioritizing eligibility for 

11           underrepresented communities and smaller 

12           organizations.  This was the most significant 

13           structural shift to our grant making process 

14           in our history.  We consolidated 65 funding 

15           categories to five, expanded the range of 

16           artistic practices, and welcomed new 

17           strategic statewide partnerships.  

18                  Coupled with our historic funding, the 

19           results of these changes have been robust. 

20           For FY '23, NYSCA saw an 80 percent increase 

21           in applications from FY '21 and funded almost 

22           300 first-time applicants.  

23                  It should be noted that small and 

24           medium-sized organizations outside of 


 1           New York City tend to have less access to 

 2           consistent institutional funding.  We are 

 3           pleased to share that for FY '23, 52 percent 

 4           of our direct grantees have organizational 

 5           budgets under half a million dollars.  

 6                  Our '23 funding opportunities included 

 7           regrowth and capacity enhancement grants, 

 8           support for organizations, support for 

 9           artists, partnerships and regrants, special 

10           opportunities, and capital projects.  

11                  For FY '23, NYSCA awarded over 3,600 

12           grants totaling almost $98 million and 

13           providing support to 1600 organizations.  We 

14           also made a significant recommitment to 

15           artists, providing support to 426 artists 

16           compared to 142 in 2021.  

17                  The final round of our grant making, 

18           capital projects, will be awarded in March. 

19           With this historic level of funding for 

20           capital projects, we saw a 48 percent 

21           increase in applications over last year.  

22           Capital projects create new tourism 

23           destinations, and investments in these 

24           projects provide exponential return for 


 1           organizations and their venues, as well as 

 2           returns to every Main Street business and 

 3           worker at hotels, restaurants, and local 

 4           stores.  

 5                  NYSCA provided an update on our 

 6           capital program in December, and I'm pleased 

 7           to share a summary, which is that we have 

 8           awarded $50 million in capital to date to 

 9           158 projects across all 10 regions of our 

10           state.  Almost 70 percent of those projects 

11           are located outside of New York City.  

12                  Examples of these projects include the 

13           Caroga Arts Collective, a performing arts 

14           center in the Southern Adirondacks, an 

15           economically depressed area.  This new 

16           state-of-the-art venue creates a year-round 

17           home for artists and continues to drive 

18           Caroga as a cultural destination.  

19                  DCTV, in New York City, reopened in 

20           September with a new state-of-the-art cinema 

21           in a former historic firehouse.  It welcomed 

22           2,200 visitors in two months, compared to 

23           1,200 visitors in all of '19.  

24                  We are pleased to play a role in the 


 1           Buffalo AKG total campus redesign project, 

 2           which will reopen in May and will be a major 

 3           economic driver for the region and the state, 

 4           projected to generate $36 million annually 

 5           and attract almost 200,000 visitors.  

 6                  Expansive communications efforts are 

 7           critical to expanding access to our dollars. 

 8           And throughout '23, NYSCA reached 6200 

 9           individuals through our webinars and virtual 

10           office hours, and our webinars continue to be 

11           posted on our website, ensuring ongoing 

12           access for our field.  

13                  We also distributed our '23 grantee 

14           lists to all state legislators, and we are 

15           deeply appreciative to you and your offices 

16           for amplifying the work of our grantees in 

17           your districts.  

18                  As I have relayed today, the 

19           understanding of the impact of arts on our 

20           health and well-being has grown immensely.  A 

21           World Health study from 2019 noted that:  

22           "Cognitive stimulation when engaging in the 

23           arts ... is not only associated with a lower 

24           risk of developing dementia but is also 


 1           interrelated with mental illness such as 

 2           depression." 

 3                  I'm pleased to share that we are 

 4           building on our Arts in Corrections 

 5           partnership, which we began a few years ago 

 6           with DOCCS, and we are expanding that 

 7           programming to 10 new adult correctional 

 8           facilities, which will launch in April.  

 9                  Thank you again for the opportunity to 

10           share the critical impact and vast reach of 

11           your historic investment in the arts in 

12           New York State.  As we have shared, our arts 

13           and culture sector is world-renowned and a 

14           critical driver for tourism, which fuels our 

15           economy and benefits individual health 

16           throughout all of life's stages.  We are so 

17           grateful to the work of our field for 

18           delivering such a compelling return on this 

19           investment.  

20                  And I look forward to your questions.  

21                  CHAIRWOMAN KRUEGER:  All right.  

22           You're giving us back three minutes.

23                  NYSCA EXEC. DIR. MANUS:  What's that?

24                  CHAIRWOMAN KRUEGER:  You're giving us 


 1           back three minutes.

 2                  NYSCA EXEC. DIR. MANUS:  You got it.

 3                  CHAIRWOMAN KRUEGER:  You get extra 

 4           points later.  Thank you.  

 5                  (Laughter.)

 6                  CHAIRWOMAN KRUEGER:  No, not extra 

 7           money, sorry, but extra points.

 8                  (Laughter.)

 9                  CHAIRWOMAN KRUEGER:  Our first 

10           questioner will be Chair Sean Ryan.

11                  SENATOR RYAN:  Thank you, Senator 

12           Krueger and Assemblymember Weinstein, for 

13           your hard work up to this point.  

14                  I have some questions for Commissioner 

15           Knight.  Thank you for being here today, for 

16           your testimony, for your work throughout 

17           New York State.  You know, you've made 

18           yourself apparent and recognizable in regions 

19           throughout the state, and we appreciate that.  

20           Look forward to working with you to ensure 

21           that the state economic development programs 

22           are working for the people of New York State.

23                  Each year in New York State we spend 

24           billions of dollars on various economic 


 1           development programs, you know, all designed 

 2           to create jobs and revitalize the economy.  

 3           And I am convinced that we need 

 4           state-of-the-art programs, and we also need 

 5           state-of-the-art transparency.  So I want to 

 6           talk about transparency for a minute.

 7                  In 2019 the budget included items 

 8           about something akin to a Database of Deals, 

 9           and I think your agency calls it the Database 

10           of Economic Incentives.  And the idea behind 

11           this was to make it so there's one easily 

12           accessible portal so people can see where 

13           economic development money is going to.  

14                  I tried to negotiate that database 

15           recently myself.  It's a little clunky.  

16           There's 3200 different incentives listed.  

17           Really hard to figure out where you start 

18           looking.  Some columns contain useful 

19           information.  Other columns, whether the 

20           award went to a private or a public entity, 

21           it seems to be entirely blank.  

22                  So I have a twofold question for you.  

23           Have you tried to use the database, and is it 

24           a database in progress or are we there for 


 1           completion?  

 2                  COMMISSIONER KNIGHT:  So thank you, 

 3           Senator, for your question.  

 4                  We have been working diligently on 

 5           this Database of Economic Incentives.  We 

 6           have taken the feedback from the Legislature 

 7           about items that might be included.  Because 

 8           our programs are so broad and wide and 

 9           varied, it requires us to have many fields 

10           for the projects.  We've just increased the 

11           number of fields from 26 to 52.  That can be 

12           a little challenging to get around, but it 

13           has all of the information that it has been 

14           indicated that people are seeking.

15                  And so it is an iterative process.  We 

16           continue to make refinements.  We continue to 

17           add projects, projects that are also outside 

18           of ESD's portfolio.  And so it is something 

19           that we will try to continue to work on to 

20           make sure that it is more navigable by the 

21           public.  

22                  SENATOR RYAN:  That's great.  Happy to 

23           hear it's an iterative process, and I look 

24           forward to looking at new iterations.  


 1                  Also in the 2022-'23 budget we passed 

 2           a requirement that ESD come up with an 

 3           economic -- hire an economic impact firm to 

 4           look at all the various programs and to 

 5           provide an analysis on every tax credit, 

 6           every tax deduction, every tax incentive, and 

 7           to look at it through what's our return on 

 8           investment as taxpayers.

 9                  Could you give us an idea of where you 

10           are in that process and when we should expect 

11           a report?  

12                  COMMISSIONER KNIGHT:  Yes, Senator.  

13                  So in the last budget there was a 

14           directive for the Department of Tax & Finance 

15           to perform a study of our economic 

16           development programs.  We are working with 

17           Tax & Finance to provide the data that they 

18           need to perform these studies.  We look 

19           forward to seeing these studies in 2024 when 

20           they are to be delivered.

21                  SENATOR RYAN:  And did you hire an 

22           outside firm?  

23                  COMMISSIONER KNIGHT:  The Department 

24           of Tax & Finance will be hiring the outside 


 1           firm.

 2                  SENATOR RYAN:  Okay.  So it went from 

 3           you to Taxation, and they're hiring.  And do 

 4           you know if they've hired?  

 5                  COMMISSIONER KNIGHT:  They have.

 6                  SENATOR RYAN:  Okay.  And do you think 

 7           you'd be able to deliver periodic updates of 

 8           how far along we are in the process and when 

 9           in 2024 we should expect this?

10                  COMMISSIONER KNIGHT:  We expect to 

11           have the report by January 1, 2024.  So just 

12           at the beginning of next year.

13                  SENATOR RYAN:  That's great.  That's 

14           great.  I know that's a a big process, but 

15           I'm happy to hear it's going.

16                  I have a question about science in the 

17           economy.  You know, we have various incentive 

18           programs in Empire State Development.  We 

19           used to have a NYSTAR program that, if my 

20           recollection is right, it was once a 

21           stand-alone program.  Now it's in Empire 

22           State Development.  And that's a -- I think 

23           it was titled the New York State Foundation 

24           for Science, Technology and Innovation.  Who 


 1           runs that within Empire State Development?  

 2                  COMMISSIONER KNIGHT:  That is run by 

 3           Matt Watson today.  

 4                  SENATOR RYAN:  That's great.  And I 

 5           know that's a very competitive field.  You 

 6           know, I have Roswell Park Cancer Institute in 

 7           my area and, you know, we go through there 

 8           and the research doctors are often like NFL 

 9           quarterbacks on short-term contracts.  

10           They're always looking for, you know, the 

11           next best deal, and it's hard to keep them.

12                  I know other states have departments 

13           just dedicated to this.  The state of Texas 

14           has a department just dedicated on research 

15           universities trying to really acquire federal 

16           money.  So it is sort of a full-time 

17           department only dedicated to bringing federal 

18           money into their state research institutions.  

19           And if there's state money layered in, it's 

20           trying to make sure that that money is -- I'm 

21           sorry, that research is then applied into the 

22           state economy.

23                  I was wondering if you had any 

24           thoughts about NYSTAR, how it's working, and 


 1           are we getting a maximum bump out of it?

 2                  COMMISSIONER KNIGHT:  Sure.  I think 

 3           that we are getting significant benefits from 

 4           NYSTAR with their -- we provide funding to 

 5           programs like the Centers of Excellence and 

 6           Centers of Advanced Technology.  

 7                  We also have another pool of funding 

 8           through our Life Sciences Initiative.  Some 

 9           of the research, medical research 

10           institutions in Western New York have been 

11           able to access funding from that Life Science 

12           Initiative.  

13                  And so we have several pools of 

14           funding to support innovation and technology 

15           here in New York State.

16                  We also have put forward this year in 

17           the budget a $6 million matching pool for the 

18           Small Business Innovation Research and Small 

19           Business Research Transfer Technology 

20           program, which small businesses seek to get 

21           federal dollars and we would provide 

22           one-to-one matching for those grant requests.  

23                  SENATOR RYAN:  So I don't know if 

24           that's the same pool of money, but there's 


 1           been a $6 million budget request for the last 

 2           four years, so we've allocated $24 million.  

 3           But it looks like only 10 million has been 

 4           spent of that.  I don't expect you to have 

 5           the answer to this, but if you, through your 

 6           folks, could provide information about where 

 7           that -- what happened with that $24 million 

 8           and why only, you know, $10 million is spent.  

 9           So just give me an update on that.

10                  COMMISSIONER KNIGHT:  Yes, I --

11                  SENATOR RYAN:  And then the last thing 

12           I wanted to talk about is workforce 

13           development.

14                  COMMISSIONER KNIGHT:  Sure.

15                  SENATOR RYAN:  Any time I talk to 

16           employers in New York State, they talk about 

17           workforce and daycare as their two biggest 

18           issues.  

19                  So on the workforce front, you know, 

20           we put $350 million into the budget last year 

21           for the Office of Strategic Workforce 

22           Development.  That money went a lot of 

23           places -- you know, OPWDD, OMH, programs at 

24           SUNY/CUNY, a program called the Expansion of 


 1           the Alternative Certification Program.  

 2                  So the question is, you know, where is 

 3           that money going?  And how are we figuring 

 4           out if that money is actually having an 

 5           impact on the workforce programs and the 

 6           workforce problems we have in New York State?

 7                  COMMISSIONER KNIGHT:  So thank you, 

 8           Senator, for that question.

 9                  Last year $350 million was put forward 

10           in the budget for workforce development.  

11           $170 million of that was allocated to ESD to 

12           stand up its Office of Strategic Workforce 

13           Development.  We have gotten that office set 

14           up and have launched a solicitation for 

15           proposals for training.  We awarded around -- 

16           just recently to six projects training 

17           3,000 individuals, with nearly a hundred 

18           business partners.  And that funding is 

19           intended to be multiyear, so the $170 million 

20           is multiyear.  

21                  And the $180 million that was 

22           allocated were to other state agencies like 

23           SUNY, DOL, DOH.  And the --

24                  SENATOR RYAN:  So that's my question 


 1           there, is the money that goes out from ESD to 

 2           the other agencies.  How are we tracking 

 3           that, and how are we trying to measure its 

 4           effectiveness?  

 5                  COMMISSIONER KNIGHT:  So we are in the 

 6           process of developing a centralized database 

 7           to track key metrics to understand the impact 

 8           of our workforce development programs.

 9                  SENATOR RYAN:  Okay, that's great.  If 

10           you could give me any information you have on 

11           that.  

12                  And I'll just close with in New York 

13           State we have over 500 workforce development 

14           programs going on right now.  Based on that, 

15           you would think we would not have a workforce 

16           development problem.  So it seems to me 

17           what's lacking is a coordinated effort.  The 

18           programs are in various departments, but 

19           there doesn't seem to be anyone holding the 

20           conductor's baton to make sure that we're 

21           spending that -- those 500 programs are being 

22           effective.  

23                  And I think it's perhaps a role for 

24           ESD to come in to help offer guidance to the 


 1           various workforce development programs 

 2           layered throughout the state.

 3                  CHAIRWOMAN KRUEGER:  Thank you.

 4                  SENATOR RYAN:  Thank you very much, 

 5           and I look forward to continuing the 

 6           conversation.

 7                  CHAIRWOMAN KRUEGER:  Thank you very 

 8           much.  

 9                  Assembly.

10                  CHAIRWOMAN WEINSTEIN:  Before we go to 

11           our chairs, I just want to acknowledge that 

12           we've been joined by Assemblywoman Fahy, 

13           Assemblywoman Shimsky, and Assemblyman 

14           Zaccaro.  

15                  And now we go for questions to the 

16           chair of our Economic Development Committee, 

17           Assemblyman Bronson, for 10 minutes.

18                  ASSEMBLYMAN BRONSON:  Thank you, 

19           Chairs Weinstein and Krueger.  

20                  My questioning is going to be with 

21           Commissioner Knight.  Thank you for being 

22           here; really appreciate it.  

23                  As you know from our previous 

24           conversations over the last two years since 


 1           I've taken over as chair of Economic 

 2           Development, we really have tried to change 

 3           the focus in two regards.  One is when you 

 4           have economic development, you have to have 

 5           corresponding workforce development.  And I'm 

 6           very pleased that the Governor in last year's 

 7           budget proposed the Office of Workforce 

 8           Development.

 9                  The second priority is to make sure 

10           that all of the investments -- and we invest 

11           billions of dollars every year in economic 

12           development -- that those investments result 

13           in us moving toward a more equitable and 

14           inclusive economy.  So in all my lines of 

15           questioning, those two things are going to be 

16           overarching principles.  

17                  So let me follow up with Senator 

18           Ryan's questions regarding the Office of 

19           Workforce Development.  You indicated in your 

20           testimony that there were 3,000 trainees and 

21           some 100 businesses.  My first question is, 

22           how were those businesses selected?  The 

23           second question is, what industries did we 

24           cover?  And, in your opinion, what were the 


 1           strategies used in that approach to move us 

 2           toward a more inclusive economy?  

 3                  COMMISSIONER KNIGHT:  So I'll start 

 4           with the types of businesses and jobs that 

 5           the 3,000 trainees are covering.  So as I 

 6           said, we have six proposals, mostly from 

 7           not-for-profit institutions that will be 

 8           providing the training.  

 9                  You know, one of the key focuses of 

10           the office is that we want the training to be 

11           driven by the private sector, so we want to 

12           respond to private-sector needs so that the 

13           training provides opportunity for trainees to 

14           be able to go in and hit the ground running.  

15                  So we have been able to work with 

16           these entities mostly in the area of advanced 

17           manufacturing, but we have a number of other 

18           areas that we are providing training in.

19                  ASSEMBLYMAN BRONSON:  Okay.  And you 

20           said you worked with nonprofits?  

21                  COMMISSIONER KNIGHT:  Yes.

22                  ASSEMBLYMAN BRONSON:  And how were 

23           those nonprofits selected?  And also, what 

24           was the criteria in selecting the awardees to 


 1           those grants?

 2                  COMMISSIONER KNIGHT:  So the 

 3           nonprofits are entities that already do 

 4           workforce development training.  And we had a 

 5           request for proposals process where we, you 

 6           know, score proposals based on -- 

 7           relationship with employers is one, because 

 8           we want to make sure that the training leads 

 9           to employment opportunities; the experience 

10           of the training providers; and whether or not 

11           they were proposing wraparound services.  

12           Because we know that historically 

13           disadvantaged communities have had difficulty 

14           accessing employment opportunities due to 

15           variables of childcare, transportation and 

16           other challenges, so we wanted to see a 

17           robust proposal that provided support in 

18           those areas.  

19                  ASSEMBLYMAN BRONSON:  So on those 

20           proposals, you know, we know that the 

21           Manufacturers Association of Central New York 

22           has a wonderful apprenticeship program.  Any 

23           of these proposals align with existing 

24           apprenticeship programs?


 1                  COMMISSIONER KNIGHT:  I don't know 

 2           that any of the proposals aligned with 

 3           apprenticeship programs, but certainly with 

 4           advanced manufacturing opportunities.

 5                  ASSEMBLYMAN BRONSON:  Okay, thank you.

 6                  COMMISSIONER KNIGHT:  And I can come 

 7           back to you with that answer.

 8                  ASSEMBLYMAN BRONSON:  The second line 

 9           of questioning relates to the FAST NY 

10           program, the shovel-ready program which we 

11           had $200 million last year.  I had wished 

12           that we would get 500 million.  I'd like to 

13           push for $500 million for that program.  And 

14           one of the reasons I'm so supportive of it is 

15           because it is aligned to a more equitable and 

16           inclusive economy, because it allows 

17           localities to select locations, hopefully 

18           that may be accessible by public 

19           transportation, close to childcare, things of 

20           that nature, that a business coming in or 

21           expanding may not be focusing on.

22                  So of the $200 million, how much of 

23           that has been expended or allocated under 

24           that program so far?  


 1                  COMMISSIONER KNIGHT:  So we continue 

 2           to solicit proposals.  I think we're going 

 3           through one of our last rounds.  I believe 

 4           we've provided over a hundred million dollars 

 5           in awards, but I can come back to you with 

 6           the exact number.

 7                  ASSEMBLYMAN BRONSON:  Okay.  And when 

 8           you get back to me on that, if you could just 

 9           identify geographic areas where that was 

10           allotted, that would be great.

11                  START-UP NY.  So your proposal is to 

12           rebrand it.  Your proposal is to extend it 

13           for another five years.  I'm not a fan; you 

14           know that.  I think it creates an uneven 

15           playing field both for employers as well as 

16           employees.  But could you share with us, 

17           what's your justification in wanting to -- 

18           and let me back up.  

19                  I understand that part of it is to 

20           make downstate area parameters similar to 

21           upstate, and I get that objective.  But 

22           putting that objective aside, what's the 

23           justification of wanting to do another 

24           five years of this program?  And what has 


 1           been the return on investment through the 

 2           program?  

 3                  COMMISSIONER KNIGHT:  So thank you for 

 4           that question, Assemblymember.

 5                  We know that the START-UP NY, which we 

 6           would like to move forward calling EPIC, has 

 7           had some back connotations.  But when we look 

 8           at the investment the state has made in the 

 9           program, which is $68 million during the life 

10           of the program, there have been over 3,000 

11           jobs created and $1.3 billion in economic 

12           activity as a result of the program.

13                  Prior to my coming to ESD, I led the 

14           Greater Jamaica Development Corporation, and 

15           we were the nonprofit partner to York 

16           College, which is a CUNY institution.  I saw 

17           some really neat features related to the 

18           program.  The business has to provide some 

19           kind of proposal nexus to the institution 

20           where it wants to locate.  And I saw 

21           internship opportunities result from 

22           companies locating in the START-UP program, 

23           faculty research opportunities.  

24                  And so if we really lean into those 


 1           aspects of the program, I think we can make 

 2           it one authority you can really appreciate.  

 3                  ASSEMBLYMAN BRONSON:  Okay.  We'll 

 4           have further discussions about that as we go 

 5           through the budget negotiations.

 6                  The next area of questioning is just 

 7           pretty general.  The Center of Excellence and 

 8           the Centers -- the CATs program, the Centers 

 9           of Advanced Technology.  The budget proposal 

10           from the Executive cuts funding to those 

11           programs.  And similar to what you were just 

12           saying about START-UP and the linkages and -- 

13           you know, these programs have been very 

14           successful in innovation across the state.  

15           So wouldn't it make more sense to continue to 

16           invest in the programs that really link up 

17           universities across the state, instead of 

18           cutting dollars to that?  How is that 

19           consistent with trying to advance our 

20           economy?  

21                  COMMISSIONER KNIGHT:  So we had an 

22           increase in the budget for those programs 

23           last year.  The -- what's proposed this year 

24           is returning them to 2021 levels.  So not a 


 1           significant cut, just we had an increase the 

 2           year before provided for -- in those 

 3           programs.

 4                  ASSEMBLYMAN BRONSON:  But a couple of 

 5           those programs, the smaller ones, the newer 

 6           ones, one here in Albany, you know, they 

 7           really needed that additional money, as did 

 8           all of them.  The one that we have in the 

 9           University of Rochester in my district, the 

10           Rochester Institute of Technology in my 

11           district.  Those expanded dollars have been 

12           well-used.  And, you know, there's -- you 

13           know, usually we want to spend the money on 

14           programs that have a record of success, yet 

15           the Governor's proposal is to cut dollars 

16           away from them.  And so just moving it back 

17           to 2021 levels, I didn't hear a justification 

18           of why that was necessary.

19                  COMMISSIONER KNIGHT:  We just believe 

20           that the 2022 levels would be adequate 

21           funding.  

22                  ASSEMBLYMAN BRONSON:  All right.  

23           Thank you very much.  Appreciate your 

24           testimony.


 1                  CHAIRWOMAN KRUEGER:  Thank you.  

 2                  Senator Murray, the ranker on the same 

 3           committee.

 4                  SENATOR MURRAY: Thank you, Chairwoman.  

 5                  And welcome, thank you for testifying 

 6           today.  Commissioner Knight, in your 

 7           testimony, in your opening statement there 

 8           was a line that you read that said "Governor 

 9           Hochul's Executive Budget aims to spur new, 

10           inclusive economic development, strengthen 

11           our business communities, and help all 

12           New Yorkers achieve the New York dream."  

13                  So I've talked to quite a few small 

14           businesses, and I assure you they were not 

15           dreaming of paying the Unemployment Insurance 

16           assessment surcharge.  

17                  Can we start with why was the decision 

18           made not to take advantage of that 

19           interest-free window the federal government 

20           gave us?  We borrowed $9.2 billion.  The 

21           federal government gave a window, we could 

22           pay it back interest-free.  The majority of 

23           the other states in the country did so.  

24           We're one of only seven that didn't.  Who 


 1           made the decision, and why was that made, to 

 2           put all of the interest payments now on the 

 3           backs of New York businesses?  

 4                  COMMISSIONER KNIGHT:  So I know that 

 5           we have been able to ask for forgiveness for 

 6           the loan.  That was done last year.  And I 

 7           know that the Department of Labor is 

 8           monitoring the situation.

 9                  SENATOR MURRAY:  Well, with all due 

10           respect, the Department of Labor also 

11           basically handed out $11 billion in 

12           fraudulent claims, so I don't really have a 

13           lot of faith there.

14                  But we had a window, and other states 

15           took advantage of it.  But we made a 

16           conscious decision, now, to hammer every 

17           single New York State business.  That wasn't 

18           their dream.  Why did we not -- even if we 

19           paid half -- we paid $162 million -- and I 

20           keep saying "we" because I'm a small business 

21           owner.  I got that bill.  We paid 

22           $162 million in interest last year.  We're 

23           going to be paying it for at least, what, a 

24           decade before we pay it off.  Could total 


 1           somewhere about three-quarters of a billion, 

 2           when all is said and done.  

 3                  Why couldn't the state help?  

 4                  COMMISSIONER KNIGHT:  The state was 

 5           requesting forgiveness for the loan.

 6                  SENATOR MURRAY:  The forgiveness was 

 7           there.  It was there for a year.  We made the 

 8           conscious decision to ignore that.  The other 

 9           states took advantage of it.  The Governor 

10           had, I think at the time, about a $12 billion 

11           surplus.  She could have paid the whole 

12           thing.  But even paying a partial would have 

13           helped businesses.  

14                  Why didn't we?  I mean, we can 

15           request, and they're laughing because they 

16           said "You had your chance."  How is that the 

17           dream of New York businesses?

18                  COMMISSIONER KNIGHT:  We -- we 

19           requested forgiveness.  And that's what we're 

20           monitoring.

21                  SENATOR MURRAY:  Okay, so let me ask 

22           you this.  You were talking about Micron 

23           coming.

24                  COMMISSIONER KNIGHT:  Yes.


 1                  SENATOR MURRAY:  Are they going to be 

 2           paying that?  Because I did a little 

 3           calculation.  At 27.6 per employee, it will 

 4           cost them about 1.38 million per year.  Is it 

 5           easy to attract businesses when they're going 

 6           to come and have that kind of a burden?  I 

 7           mean, we're competing against other states 

 8           that didn't do this to business.  I would -- 

 9           I would think that it doesn't exactly make 

10           your job easy to attract more businesses.  

11                  But are they going to be paying that?  

12                  COMMISSIONER KNIGHT:  They will be 

13           paying whatever is required of them.

14                  SENATOR MURRAY:  So they will.  So any 

15           new business we bring into New York now is 

16           automatically saddled with this until it's 

17           paid off.  Is that correct?  

18                  COMMISSIONER KNIGHT:  Well, whatever 

19           is required of businesses, they will pay.

20                  SENATOR MURRAY:  Right, $27.60 per 

21           employee.  And I've heard the term "death by 

22           a thousand cuts" from businesses.  We are 

23           losing people at an alarming rate.  But not 

24           just people, we are losing businesses.  I 


 1           mean, what efforts are we making to stop this 

 2           outflow of businesses?

 3                  COMMISSIONER KNIGHT:  We had a 

 4           $1 billion Small Business Rescue Plan, which 

 5           we continue to disburse through a number of 

 6           our programs.  As you know, the Legislature 

 7           helped with the $800 million Small Business 

 8           Recovery Grant program, which we have been 

 9           providing support to.  We've been able to 

10           disburse that fund.  We provided support to 

11           41,000 businesses at an average of 18 --

12                  SENATOR MURRAY:  Okay, my time is 

13           short, so I'm going to -- I'm going to -- 

14           thank you, but I'm going to cut you there, 

15           just to switch real quickly back over to the 

16           START-UP NY and the change now to EPIC.  

17                  Do you know much we spent in 

18           advertising, promoting START-UP NY over the 

19           years?  Tax dollars, I might add. 

20                  COMMISSIONER KNIGHT:  I would have to 

21           look at it.  I know that happened way before 

22           I arrived at ESD.  We have not spent any 

23           funding while I've been there to promote the 

24           program.


 1                  SENATOR MURRAY:  Well, that's because 

 2           I believe it was the Cuomo promo at the time.

 3                  But now that we're switching it, do 

 4           you have an estimate on how much we will be 

 5           spending to promote the new EPIC program?  

 6                  COMMISSIONER KNIGHT:  We will spend no 

 7           funding to promote the new program.  We will 

 8           use our existing outreach efforts with our 

 9           REDCs, regional office staff, and ESD staff 

10           to promote the program.

11                  SENATOR MURRAY:  Okay.  Thank you very 

12           much.

13                  CHAIRWOMAN KRUEGER:  Thank you.

14                  Assembly.

15                  CHAIRWOMAN WEINSTEIN:  We go to 

16           Assemblyman Stirpe, chair of our Small 

17           Business Committee.

18                  ASSEMBLYMAN STIRPE:  Thank you.  

19                  Commissioner, I'm going to go back to 

20           the Centers of Excellence.  You know, my 

21           colleague Harry Bronson talked about it a 

22           little bit.  But the disturbing fact for me 

23           is this is probably the third time I've come 

24           back on this, and knowing that the return on 


 1           investment for Centers of Excellence is 

 2           24-to-1 or more.  

 3                  And you have programs like START-UP 

 4           where I'm sure that the return on investment 

 5           is not 24-to-1 or more.  And yet we struggle 

 6           to keep that alive while we're cutting 

 7           Centers of Excellence.  And I still can't 

 8           wrap my head around it, as a former 

 9           businessman who, when you have something 

10           that's successful, you seem to invest more in 

11           it in order to get more return.  But we seem 

12           to not follow that same strategy, for some 

13           reason.

14                  And let me just ask you, the Center of 

15           Excellence for Healthy Water, the 

16           collaboration between SUNY ESF and Clarkson.  

17           Last year we plussed them up to a 

18           million dollars.  They were very excited.  

19           The money is just being disbursed now.  But 

20           they're working on some projects that are -- 

21           I call urgent.  You know, the state knows a 

22           lot about PFAS problems, and four companies 

23           have been created through that Center of 

24           Excellence that are working on this problem.  


 1           And they have solutions, much less expensive 

 2           than what people are doing now.  

 3                  We also are working on algal blooms in 

 4           seemingly all of our lakes.  And there are 

 5           two companies working on that issue.

 6                  So the fact that we only want to spend 

 7           $375,000, and I don't know how many millions 

 8           of dollars we'll try to spend to solve those 

 9           two issues, it would seem that you could put 

10           a lot more money in that particular Center of 

11           Excellence.  

12                  I mean, are we keeping track of what 

13           these Centers of Excellence and CATs are 

14           working on so we know what's the most 

15           important thing?  

16                  COMMISSIONER KNIGHT:  Thank you.  We 

17           have -- we definitely keep track of what's 

18           happening in the Centers of Excellence.  

19                  We have other programs that businesses 

20           who are working on emerging technology can 

21           take advantage of.  And we are always putting 

22           the Centers of Excellence and those 

23           businesses in touch with our other programs 

24           so they can take advantage of accessing 


 1           funding for those.

 2                  ASSEMBLYMAN STIRPE:  Okay.  All right.  

 3           Well, that's good.  But I hope before the 

 4           process of the budget is completed at the end 

 5           of March that we have decided to go ahead 

 6           and, you know, invest more money in our 

 7           successful programs.

 8                  Some of the other things -- you know, 

 9           we talked about workforce.  Everybody talks 

10           about workforce.  And I think it was great, 

11           especially last year, the $350 million.  And 

12           I thought it was wise that we're using some 

13           economic development money for childcare, 

14           different childcare programs.  And we've 

15           talked about this before.  

16                  There's the issue of lack of 

17           workforce.  One other thing I recommended and 

18           I thought could be helpful is investing some 

19           economic development money in adult literacy.  

20           We have lots of immigrants, refugees that 

21           have entered our state.  You know, it's hard 

22           for them to go ahead and get a job without a 

23           certain level of literacy.  But even at the 

24           lower-level positions -- which seemed, you 


 1           know, throughout the pandemic people have 

 2           left those positions and moved up to 

 3           better-paying positions -- they could at 

 4           least fill those if they could read and write 

 5           in English.  

 6                  So again, I'd recommend taking a look 

 7           at these adult literacy programs, which never 

 8           get funded to the level they need to be.  

 9           There's always waiting lists in every region 

10           of the state.  So I hope you'll take a look 

11           at that.

12                  Let's see.  Semiconductors.  I was the 

13           lucky winner in the $100 billion Micron 

14           agreement.  It's in my district.  And I'm 

15           very grateful for that.  I have a lot of 

16           people asking me a lot of questions about it.  

17           You know, certainly they hear about different 

18           high-tech companies, including Micron, laying 

19           off employees and how that will affect our 

20           program and, you know, like that.  I try to 

21           assure them that by the time we are built and 

22           in production, things will have changed quite 

23           a bit.  Plus the fact that we'll be building 

24           next-generation type of products, not the 


 1           legacy products they produce now.  

 2                  But the one area which I can't answer 

 3           any questions yet is about the sustainability 

 4           side of the agreement.  And what does it 

 5           really mean?  What happens if they don't meet 

 6           those goals?  And can you tell me a little 

 7           bit about that?  

 8                  COMMISSIONER KNIGHT:  So thank you, 

 9           Assemblyman.  

10                  So we -- we're very excited to attract 

11           Micron to your district.  And a big part of 

12           the negotiations were around sustainability 

13           and Micron putting together a sustainability 

14           plan.  

15                  Kevin Younis, chief operating officer 

16           of ESD, was very involved in the project, and 

17           I'll let him talk a little bit about the 

18           sustainability plans that we have for the 

19           project.

20                  ESD COO YOUNIS:  Thanks, Hope.  

21                  Thanks, Assemblyman.  How are you?

22                  ASSEMBLYMAN STIRPE:  Welcome.

23                  ESD COO YOUNIS:  Yeah, so as you know, 

24           first and foremost, the program is an 


 1           economic development program.  Right?  It's 

 2           about bringing those jobs and that investment 

 3           to New York.  

 4                  But, you know, in the context of the 

 5           CLCPA and greenhouse gas emissions, we do 

 6           require them to have sustainability goals.  

 7           It is -- it will be part of their commitment 

 8           to New York.  It will be -- the receipt of 

 9           those enhanced benefits will be contingent 

10           upon meeting those commitments.  So 

11           100 percent renewable electricity, greenhouse 

12           gas emissions, I think LEAD certification, a 

13           goal they're -- higher for all of their 

14           buildings.  We're working really closely with 

15           NYSERDA and with our colleagues at DEC to -- 

16           you know, even from today, from construction, 

17           that they're using every appropriate effort 

18           to reduce greenhouse gas emissions.  So 

19           that's electric vehicles, that is the type of 

20           cement they might be using.  

21                  So we're meeting with them almost 

22           daily, with our colleagues throughout the 

23           state.  So --

24                  ASSEMBLYMAN STIRPE:  Can I ask you -- 


 1           I mean, the amount of energy that's required 

 2           for these facilities is enormous.  And I 

 3           guess the fear that most people have is that 

 4           if they get all the green energy that's being 

 5           produced in the area, that will take it away 

 6           from other businesses, residential homes.  

 7                  You know, do we -- do we see, you 

 8           know, in the future a plan that shows for a 

 9           certain amount of green energy coming online 

10           continuously as we go through this process, 

11           that's going to be able to feed everybody 

12           that wants to use that?

13                  ESD COO YOUNIS:  So I guess the larger 

14           CLCPA goals require 100 percent renewable 

15           electricity for the state's entire use by 

16           2040, I believe.  And what's interesting 

17           about a company like Micron and their 

18           commitments to sustainability is they create 

19           a demand.  Right?  They have a commitment to 

20           us and to their customers and to their 

21           shareholders for 100 percent renewables.  

22                  So imagine, you know, it's a real 

23           driver for folks to invest in the renewable 

24           energy production.


 1                  ASSEMBLYMAN STIRPE:  Okay, thank you.  

 2                  One quick question, Council on the 

 3           Arts Director Manus.  I sort of entered the 

 4           Marketplace of the Arts a little more than a 

 5           year ago trying to help get a few things 

 6           going -- a couple of festivals and stuff -- 

 7           and it was like walking into Lord of the 

 8           Flies.  I mean, there are people in each 

 9           region that don't play well together, 

10           actually hate each other, et cetera.  And I'm 

11           afraid sometimes the funding goes to 

12           duplicative type of festivals and things.

13                  Is there any way that there can be 

14           some oversight regionally to make sure that 

15           we get more of a balance of events, 

16           festivals, programs, things like that, so 

17           people, you know, aren't fighting amongst 

18           themselves for the little bit of money, in 

19           their minds, that ends up being provided by 

20           the Council on the Arts?

21                  NYSCA EXEC. DIR. MANUS:  Sure.  Thank 

22           you so much for that question.  

23                  And by the way, please direct any of 

24           your constituents to our offices.  We're 


 1           happy to talk out and talk through any of 

 2           their challenges in applying for funding from 

 3           NYSCA.  

 4                  That said, I just wanted to once again 

 5           highlight the fact that we did completely 

 6           overhaul our grantee -- our grant application 

 7           process a couple of years ago to create 

 8           greater access for everyone to apply.  And 

 9           so -- and that included changing out the 

10           technology, bringing in SmartSimple, which is 

11           used by other state arts agencies across the 

12           country, literally taking our application 

13           down to like three pages.  

14                  So the goal is continuing to create 

15           opportunity for new grantees to enter our 

16           funding pool, and this year --

17                  CHAIRWOMAN KRUEGER:  Thank you, I'm 

18           going to cut you off there and you can follow 

19           up with the Assemblyman afterwards.

20                  ASSEMBLYMAN STIRPE:  Thank you very 

21           much.

22                  NYSCA EXEC. DIR. MANUS:  Can I just 

23           finish?  We had 300 new grantees this year.  

24           Thank you.  


 1                  CHAIRWOMAN KRUEGER:  Thank you.

 2                  UNIDENTIFIED PANELIST:  You don't get 

 3           that 2 minutes back.

 4                  (Laughter.)

 5                  CHAIRWOMAN KRUEGER:  No, you don't get 

 6           it back.  

 7                  Just so everybody does understand, 

 8           there's a one-minute warning that beeps and 

 9           the yellow light goes on, for those who are 

10           looking at the clocks.  And that means 

11           there's one minute left, in total, for the 

12           question and the answer.  

13                  So some of my colleagues love to get 

14           to the 3-second mark and throw in a new 

15           question.  It doesn't work, because you can't 

16           get an answer.  

17                  So I want everybody to understand that 

18           that time clock is both for the questions and 

19           the answers.  So really we're making it 

20           unfair for you at the table when we suddenly 

21           throw in another question when you can't 

22           possibly answer it in time.  So this is 

23           really addressed to my colleagues.  Thank 

24           you.  


 1                  Oh, and we do have a gavel.  We 

 2           haven't used it yet.  And we're still not 

 3           sure whether we're supposed to go hit the 

 4           person or hit the table.  

 5                  (Laughter.)

 6                  CHAIRWOMAN KRUEGER:  But we have a 

 7           gavel.  I'm just letting you know.

 8                  We're not really violent women, are 

 9           we?

10                  CHAIRWOMAN WEINSTEIN:  Just want to 

11           introduce -- we've been joined by 

12           Assemblyman Colton and Assemblyman O'Donnell, 

13           chair of our Tourism Committee.  

14                  Now to the Senate.

15                  CHAIRWOMAN KRUEGER:  Thank you.  And 

16           we're now going to Senator Jeremy Cooney, who 

17           is chair of the new Procurement -- and he 

18           will say the rest of the name of the 

19           committee, because I'm not sure.  Thank you.

20                  Ten minutes for Jeremy.  Oh, and we 

21           have to give him a chair.  Thank you.  

22                  SENATOR COONEY:  We have a mic issue 

23           here.  There we go.  There we go.  We got it 

24           all figured out.  


 1                  Thank you, Chair Krueger.  And great 

 2           to see everyone here today, and appreciate 

 3           your comments.  

 4                  Let me start in my capacity as the 

 5           chair of Procurement and Contracts, start 

 6           with my friend Commissioner Moy.  And let me 

 7           commend you for the work that you're doing to 

 8           modernize and bring us up to the 21st century 

 9           when it comes to how we get our contracts, 

10           interact with our vendors across the State of 

11           New York.  I think you mentioned in your 

12           opening remarks that this is the -- we're one 

13           of the last states to get there.  So thank 

14           you for helping to lead us over the finish 

15           line.

16                  And I also want to just highlight the 

17           work that you're doing around our veterans, 

18           and I want to thank you and hope that we can 

19           work together this coming year on how to 

20           expand that designation across the State of 

21           New York.

22                  My comments are both to ESD and to 

23           NYSCA.  I'll start with you, Commissioner, 

24           and Kevin if appropriate.  Let me echo the 


 1           comments of my colleague and Rochester 

 2           friend.  Assemblymember Bronson, Chair 

 3           Bronson, brought up the fact that we were 

 4           disappointed that we didn't see more 

 5           investment in the shovel-ready program.  Let 

 6           me just reemphasize how important that is, 

 7           especially to communities across upstate 

 8           New York.  You know, I previously served as 

 9           the chair of Cities 2 in the Senate, which 

10           visited small and midsized cities across our 

11           state.  Many of whom are ready to kind of 

12           take that next step with their megasite 

13           development to hopefully, you know, attract 

14           companies -- maybe not as large as Micron in 

15           Clay -- but certainly be ready for the 

16           opportunities.  And being competitive means 

17           being ready for that negotiation.  And so I 

18           think that's incredibly important.  I know 

19           we're going to hear from folks later today 

20           about the importance of that program as well.

21                  Let me also say that I do think I'm 

22           very proud, as Assemblyman Stirpe said, about 

23           the Green CHIPS bill.  And it's a huge win 

24           for our state.  Let me commend you at ESD, of 


 1           course, and Governor Hochul.  But there's an 

 2           opportunity to kind of think about what that 

 3           next step is.  

 4                  As we're seeing the success of Micron 

 5           and the excitement, there are more 

 6           opportunities coming to communities outside 

 7           of Syracuse to take advantage, whether we're 

 8           talking about supply chain or whether we're 

 9           talking about other aspects of manufacturing 

10           and packaging.  And I think we're going to be 

11           putting together some legislation where we'll 

12           work closely with you at ESD about how we can 

13           attract those types of businesses like we're 

14           seeing in my neck of the woods in Batavia and 

15           STAMP.  In Genesee County, we're very pleased 

16           with Edwards Vacuum.  But I think that's just 

17           the beginning, and there's more companies 

18           across the state that are looking for that 

19           investment to help grow.  And those, of 

20           course, are job-creation opportunities.  

21                  It's been mentioned before over the 

22           course of this week, especially in our public 

23           safety hearing, that there's a direct 

24           relationship between economic opportunity and 


 1           public safety.  And we know that far too 

 2           often our residents who live in these small 

 3           and midsized cities outside of the City of 

 4           New York don't often get the opportunities to 

 5           get these good-paying jobs because oftentimes 

 6           they're locating in rural parks because of 

 7           the site-readiness that we've talked about 

 8           before.  

 9                  And so we want to be more intentional 

10           about creating opportunities for those living 

11           in the cities to access these types of jobs, 

12           many of which are paying well beyond their 

13           current earnings for their families.  So as a 

14           strategy to reduce poverty and to increase 

15           public safety across our state, investment in 

16           these types of opportunities is going to be 

17           critical.  And I thank you for your 

18           partnership and work in that.

19                  Let me turn to NYSCA and Director 

20           Manus.  Thank you for your leadership.  Your 

21           comments were great and encouraging.  I would 

22           say, in just picking up the mantle from my 

23           colleague, it is a little bit like Lord of 

24           the Flies.  And let me -- let me blow into 


 1           the conch for you.  

 2                  (Laughter.)

 3                  SENATOR COONEY:  I think that we have 

 4           good intentions and we have good 

 5           opportunities.  That modernization of the 

 6           grant portal is huge.  We're hearing direct 

 7           feedback.  As someone who sits on the 

 8           Cultural Affairs Committee in the Senate, 

 9           I've been very pleased to hear firsthand from 

10           a lot of our grantees and recipients in the 

11           Finger Lakes region.  But we're not getting 

12           the money out fast enough.  And, you know, 

13           we've got to figure out a better way to do 

14           that.

15                  It's my understanding that the Senate 

16           and Assembly made a legislative add last year 

17           to add $10 million in new funding for upstate 

18           arts organizations, organizations outside of 

19           the City of New York, which have 

20           disproportionately been invested in over the 

21           course of years.  But my understanding is 

22           that money may have just gone out as recently 

23           as last week.  I'm wondering why it took so 

24           long after the allocation last year for it to 


 1           actually be disbursed to the first round of 

 2           recipients.

 3                  NYSCA EXEC. DIR. MANUS:  Sure.  Thank 

 4           you so much for that question.

 5                  So all of those contracts start in 

 6           January 2023.  We are not -- our agency 

 7           cannot start processing anything or even 

 8           request those funds until the beginning of 

 9           January.  So I think it's something that 

10           probably we need to address with our 

11           recipients.  They get award letters starting 

12           in early fall and -- but again, we cannot 

13           start putting money into the field until -- 

14           we can't start even processing those 

15           contracts until January.

16                  So here we are in February.  I'm happy 

17           to share that 78 percent of our grants, the 

18           small grants, our $10,000 and less grants, 

19           have been already paid out as of this date.  

20           And we are working as quickly as we can to 

21           move the rest of those contracts.

22                  I will also let you know that 

23           depending on the size of the grant -- so if 

24           it's over $50,000, that also entails a 


 1           process that includes AG and OSC, and so -- 

 2           which can add a number of weeks until it gets 

 3           back to finance for payout.

 4                  SENATOR COONEY:  Understood.  And I 

 5           think, you know, if there's -- we can have 

 6           this conversation offline if there are 

 7           resources that NYSCA needs, whether it's more 

 8           reviewers or just a little bit of help to 

 9           make sure that our partners in government are 

10           coordinating this, we certainly are willing 

11           to do that.

12                  But I do think that, you know, this 

13           time frame for getting money out the door, 

14           even if it was communicated for January 2023, 

15           is still alarming, because people are, as you 

16           know better than me, a lot of these 

17           organizations are so dependent on funding, 

18           especially these smaller type organizations.

19                  One of the goals that we had when we 

20           added this funding -- and that I spoke to 

21           Chair Serrano about -- was making sure that 

22           different types of organizations would be 

23           give the opportunity to get this funding.  

24           And I want to speak very clearly for at least 


 1           my neck of the woods, in the Rochester area:  

 2           Arts organizations, many artists of color, 

 3           are clearly just missing the opportunities.  

 4           Maybe they don't know about it or they're not 

 5           eligible to apply for some reason because of 

 6           their size and scope, they don't have a paid 

 7           lobbyist looking for these opportunities.  

 8                  And so we want to make sure that these 

 9           types of organizations -- not necessarily the 

10           large institutions or even the midsize 

11           institutions -- are getting an opportunity to 

12           access these dollars.  Because we know the 

13           value that the arts have, not only on 

14           economic development, certainly, but also in 

15           just the quality of life across New York.  

16                  I'll also add that I think this 

17           opportunity, if we're able to restore it in 

18           the budget for next year, maybe we can work 

19           with your office to kind of put some 

20           guardrails, if you will, in kind of how this 

21           money could be steered or what some 

22           preferences might be as you go through your 

23           review process, so that we're getting this 

24           money directly into the hands of these 


 1           organizations that may not know about it or 

 2           may have not received funding in the past 

 3           from NYSCA.

 4                  I know that you already have a 

 5           regional approach, and I applaud that.  But I 

 6           do think that we can improve that process.

 7                  And I'll also say, as we're talking 

 8           about the arts -- and we're going to hear 

 9           from some speakers later today -- let me say 

10           in front of all my colleagues how supportive 

11           I am of our upstate theaters, especially our 

12           historic theaters, which are the lifeblood 

13           for many of downtown communities.  Again, 

14           putting my arts hat on and my upstate cities 

15           hat on, I see that a lot of these theaters 

16           were able to survive the pandemic, but 

17           barely.  And finding ways to make not just 

18           capital but also operational investments in 

19           these theaters is going to be critical, not 

20           only to the health of the arts, but also our 

21           urban centers outside of New York City.  So 

22           just wanted to emphasize that while I had 

23           your attention.

24                  NYSCA EXEC. DIR. MANUS:  Yeah, no, 


 1           thank you so much.  And look forward to 

 2           working with your office to bring our funding 

 3           to the attention of -- the opportunity for it 

 4           to many more organizations.  

 5                  I just want to let you know that this 

 6           year we made 507 grants to organizations with 

 7           budgets under $250,000.  So -- and 82 percent 

 8           of our grants are to organizations with, as I 

 9           said, $3 million.  But we really -- I mean, 

10           the majority of our funding is really still 

11           directed at very small and medium-sized 

12           organizations across our state.  And as you 

13           said, we do prioritize regional distribution.

14                  SENATOR COONEY:  Yes, and I think 

15           that's great.  And I know that with the 

16           additional money put into arts capital, a lot 

17           of that was going to that larger-sized 

18           institutional dollars -- and that's where the 

19           need is, obviously, with capital.  But I 

20           think there's ways that we can improve still 

21           those small individual artists who may not 

22           have an organization but could work 

23           collaboratively with an organization.  I'm 

24           talking about teaching artists or working 


 1           with local community foundations -- ways that 

 2           we can empower those individual artists to 

 3           stay and thrive in New York State.  

 4                  Be happy to follow up with you 

 5           offline, and I'll be mindful of my time and 

 6           leave it back to the chair.  Thank you.

 7                  NYSCA EXEC. DIR. MANUS:  Look forward 

 8           to that.  Thank you so much.

 9                  SENATOR COONEY:  Thank you.

10                  CHAIRWOMAN KRUEGER:  Thank you very 

11           much.

12                  Assembly.

13                  CHAIRWOMAN WEINSTEIN:  We go to 

14           Assemblyman O'Donnell, chair of our 

15           Tourism Committee, for 10 minutes.

16                  ASSEMBLYMAN O'DONNELL:  Good morning, 

17           and I apologize for being late.  All the 

18           lights in my car started to flash like a 

19           Christmas tree.  I'm not sure what that's 

20           about, but I got here.

21                  When we began session this year we had 

22           a minister, a woman minister, lead a prayer, 

23           and one of the things that she said to us was 

24           that budgets are moral documents.  So 


 1           Ms. Knight, I'd like to ask you first whether 

 2           or not this budget that you're presenting 

 3           today reflects your morals.  Because I want 

 4           to be very clear, it does not reflect mine.

 5                  COMMISSIONER KNIGHT:  Yes, 

 6           Assemblymember, it does.

 7                  ASSEMBLYMAN O'DONNELL:  Okay.  So in 

 8           the end of your testimony -- I didn't hear 

 9           it, I just read it, I read quickly -- you 

10           talk about tax credits.  And the interesting 

11           thing about tax credits is they're only 

12           useful for people who pay taxes.  Right?

13                  So the arts budget is criminal, it's 

14           criminal, the amount of money.  It's the 

15           lowest art proposal since the 1960s.  Really?  

16                  And it defies credibility that you 

17           could count on an entity that is such an 

18           economic engine in the State of New York to 

19           continue to try to recover unless you provide 

20           them with the resources to do that.  Giving a 

21           tax-exempt organization the impossibility of 

22           applying for a tax credit gets them nothing.  

23           What do you have to say about that?

24                  COMMISSIONER KNIGHT:  Assemblymember, 


 1           we clearly understand at ESD the role that 

 2           the arts play in economic development.  We 

 3           focus on providing support to entities that 

 4           are supporting tourism through Broadway and 

 5           other performing entertainment industries.

 6                  We do not focus on supporting arts 

 7           organizations at ESD.  NYSCA is the entity 

 8           that supports those groups.

 9                  ASSEMBLYMAN O'DONNELL:  Yes, I'm very 

10           aware of that.

11                  Ms. Manus, can I ask you a question?  

12           Is it even possible for you to do your job 

13           with this level of funding?

14                  NYSCA EXEC. DIR. MANUS:  I would say 

15           that NYSCA does its best, the best that we 

16           can with the funding that we're given on a 

17           yearly basis.  It is true that the COVID -- I 

18           mean, we have a survey that just closed on 

19           Monday with some very timely data about the 

20           impact of COVID on our arts sector.  And 

21           there is -- you know, it's clear that 

22           basically the headlines are that we have 

23           decreased audiences, decreased revenue, and 

24           dramatically increased operating costs.  And 


 1           for a sector that returns so much to the 

 2           state in terms of economic development, 

 3           obviously more investment would be -- would 

 4           have further return.

 5                  ASSEMBLYMAN O'DONNELL:  So the record 

 6           is clear, I have family members who produce 

 7           for-profit theater on Broadway, so I'm 

 8           familiar with that entity entirely.  But 

 9           that's not the sort of work that you promote, 

10           correct?

11                  NYSCA EXEC. DIR. MANUS:  So any 

12           investment -- you know, I think we have to 

13           think about this -- or what we know about 

14           theater is basically it's one ecosystem, 

15           right?  So there's a lot of fluidity in terms 

16           of the workers and the work between the 

17           nonprofit theater community as well as 

18           Broadway.  So investment in Broadway is still 

19           investment in supporting the creative workers 

20           and the artists in our field.  However and 

21           still we need to recognize the fact that the 

22           origination of work, some of the hit shows 

23           that have gone on Broadway, like Hadestown, 

24           Dear Evan Hansen, Hamilton, all originated in 


 1           nonprofit theaters.  And also that most of 

 2           the artists and even creative workers on 

 3           Broadway have started their careers and work 

 4           interchangeably between the off-Broadway 

 5           theaters and Broadway.

 6                  ASSEMBLYMAN O'DONNELL:  If New York is 

 7           to remain the capital of arts in America, how 

 8           can we do that without supporting the 

 9           non-for-profit companies that are creating 

10           that art?  Kimberly Akimbo, A Strange Loop, 

11           Hamilton, all of those things did not start 

12           in the for-profit Broadway theater.  They 

13           started with creative people who came to 

14           New York to have a chance to do that, and 

15           obviously it's an expensive city to live in.  

16           But they come with the dream that maybe one 

17           day they're going to write the next Hamilton.

18                  So without that funding to provide the 

19           support for the creation of those pieces of 

20           art, won't that in the long run hurt and 

21           destroy Broadway?

22                  NYSCA EXEC. DIR. MANUS:  I think it 

23           will definitely have impact, for all the 

24           reasons that you're stating.


 1                  I think that we also have to recognize 

 2           the fact that COVID has -- when we talk about 

 3           recovery of audiences, our conversations with 

 4           the theater, any of the organizations in the 

 5           performing arts, is that audiences may not be 

 6           coming back in the way that they were in 

 7           2019, because of the way that we now work and 

 8           live.  And so the -- so we are now thinking 

 9           that -- we're now having to support and think 

10           about supporting really a pivot to a 

11           completely different paradigm, or a different 

12           paradigm for many performing arts 

13           organizations and museums as well.  How can 

14           they monetize a hybrid structure which was 

15           started under COVID, and now may not be as 

16           formally in place, but is certainly now a 

17           part of the new norm for the arts?

18                  ASSEMBLYMAN O'DONNELL:  And so how do 

19           you suggest we plan financially for a new 

20           norm in supporting of the arts?

21                  NYSCA EXEC. DIR. MANUS:  Well, any 

22           dollar invested in the arts is returned to 

23           New York State in so many ways.  And we are I 

24           think recognizing the fact that we are still 


 1           in recovery mode, as I have pages and pages 

 2           of our COVID impact study that I'm happy to 

 3           share.

 4                  And, you know, it -- the numbers are 

 5           there in black and white and I think we have 

 6           to be cognizant of the fact that continued 

 7           investment would result in a more robust 

 8           industry for all of us.

 9                  ASSEMBLYMAN O'DONNELL:  One of the 

10           frustrations of mine in this job is everybody 

11           who comes to see me wants something, and they 

12           all feel like they don't get enough.  It 

13           doesn't make a difference where they are or 

14           who they are, but they feel that their group 

15           that they represent is not given enough 

16           support to do what they do.  And that is 

17           partially -- has a regional breakdown.  Last 

18           year at the end of this budget session 

19           Westchester came to me and said, We don't get 

20           enough.  Now, I represent Manhattan, but 

21           never heard "We don't have enough in 

22           Westchester" before, the sentence.  Right? 

23           And yet they honestly feel that way.  Right?

24                  So how do we as a body make sure that 


 1           the resources we put in are balanced in their 

 2           distribution?  Ms. Fahy, sitting to my left, 

 3           would regularly complain about the fact that 

 4           not enough money went to the Capital Region.  

 5           She doesn't complain so much to me anymore; 

 6           she has other things to do.  But she still 

 7           thinks that, right?  And it's a part of human 

 8           nature.

 9                  So how can we make sure that the money 

10           we give to grow the arts is distributed 

11           fairly?

12                  NYSCA EXEC. DIR. MANUS:  Right.  Thank 

13           you so much.  And that continues to be 

14           obviously one of our goals in our overhaul of 

15           our application process and the outcomes of 

16           it.

17                  We -- we should know that we 

18           basically -- it's -- our funding breaks down 

19           to about 60/40 because of the concentration 

20           of arts organizations in New York City.  So 

21           it's reflective of and on a proportional 

22           basis, in terms of our -- the success of our 

23           grantees, those that apply to us, they are as 

24           successful if not more successful outside of 


 1           New York than they are in New York.  So I 

 2           think getting the word out about our funding, 

 3           our new application process, that we're here 

 4           for everyone, is critical.  And we look to 

 5           all of your offices to help us in that.

 6                  ASSEMBLYMAN O'DONNELL:  And most 

 7           importantly, giving you the adequate funding 

 8           to do your job would be helpful too, I 

 9           suppose.

10                  NYSCA EXEC. DIR. MANUS:  Thank you.

11                  ASSEMBLYMAN O'DONNELL:  You do?  Okay.

12                  One last thing.  I've always supported 

13           tax credits, but under no circumstances will 

14           I support tax credits unless this arts budget 

15           is restored.  

16                  Please send that to the Second Floor.  

17           Thank you very much.

18                  CHAIRWOMAN WEINSTEIN:  Senate?

19                  CHAIRWOMAN KRUEGER:  Thank you.

20                  Senator Serrano.

21                  SENATOR SERRANO:  Thank you, Chairs 

22           Krueger and Weinstein, to all my colleagues.  

23           NYSCA Executive Director Mara Manus, always 

24           great to see you.  Thank you very much for 


 1           being here.

 2                  I know I'm preaching to the choir when 

 3           I talk about how important the arts are to 

 4           the entire State of New York, how important 

 5           they are to our society -- certainly not 

 6           merely a luxury or an aesthetic, but indeed a 

 7           very important part of the fabric and 

 8           foundation of our society.

 9                  And indeed the trauma that all of us 

10           have dealt with through this pandemic, the 

11           arts are that good medicine that will help us 

12           continue to heal, in so many important and 

13           positive ways, as a state.

14                  Also the arts historically have been 

15           such an important vehicle for social justice 

16           and discussion, in ways that I believe no 

17           other medium can get close to.  Having 

18           important discussions, allowing all of us to 

19           move forward on things that we really need to 

20           deal with.  And sometimes uncomfortable 

21           conversations are done in a way with the 

22           arts, and in theater or any other type of 

23           cultural venue, in ways that are not 

24           polarizing, in ways that bring us all 


 1           together.  

 2                  Also it's obvious that the arts are a 

 3           tremendous economic engine for the State of 

 4           New York, and not just for New York City.  I 

 5           mean, for many years some thought of the arts 

 6           in New York State as a very New York 

 7           City-centric idea.  But indeed it is a major 

 8           economic generator for the entire state.  

 9           Upstate economies, Western New York, all rely 

10           very heavily on a strong and robust arts 

11           community and the ability for artists to 

12           continue to do the work that they love.

13                  And I would argue that in the worst of 

14           economic times it's really the best time to 

15           truly support the arts, because of the fact 

16           that they are best able to turn around and be 

17           that economic generator that we need.

18                  And during the pandemic we heard from 

19           more arts organizations than ever before.  

20           The pandemic weighed heavily on their ability 

21           to keep their doors open, to maintain their 

22           staff and to keep them safe.  In response, 

23           the Legislature and the Governor wisely made 

24           over $85 million available, additional 


 1           dollars available, in each of the last two 

 2           budgets.  Obviously this was federal pandemic 

 3           relief, but it was so wonderful to see it go 

 4           to an area that had such tremendous need.

 5                  Unfortunately, in the proposed budget, 

 6           now we see that the funding has returned to 

 7           the pre-pandemic levels:  I believe 

 8           41 million.  And I would argue that 20 years 

 9           ago it should have been higher.  And it 

10           should have been increasing ever since.

11                  And that leads me to a couple of 

12           questions.  And you mentioned in your 

13           testimony, Executive Director Manus, about an 

14           overhaul of the application process for NYSCA 

15           to create greater access to dollars and 

16           prioritizing and sort of expanding, I guess, 

17           the reach of these grants.  I think that's 

18           such a wonderful -- a wonderful thing, 

19           because the more organizations that 

20           historically have not been part of this, to 

21           become part of it, I think it just expands 

22           the good things in different regions 

23           throughout the State of New York.

24                  But with this reduction, this proposed 


 1           reduction in funding, how will NYSCA be able 

 2           to move forward with their grants?  Because 

 3           I'm assuming in the last two years there was 

 4           an increase in the number of applications.  

 5           And again, how will we able to sort of 

 6           reconcile the increased interest and desire 

 7           to access these funds with the lower amount?

 8                  NYSCA EXEC. DIR. MANUS:  Thank you so 

 9           much for your questions.

10                  I think the bottom line is we'll try 

11           to do our best with what we have.  I'm sure 

12           that you're aware that we also offer 

13           multiyear grants for organizations, and we 

14           have a number of organizations -- I can get 

15           you that exact number -- on multiyear grants.  

16           So one of two, one of three years, and those 

17           commitments have been made.  Of course 

18           they're adjusted, they're subject to 

19           adjustment by the budget, the appropriation 

20           that we receive.  But they -- if we do get 

21           lower budgets, that will have an impact on 

22           those as well as, as you've mentioned, our 

23           goals in trying to expand the field, expand 

24           our funding and create greater access to 


 1           those who are seeking it.

 2                  We do our best every year with what we 

 3           have.  And I commend our incredible staff for 

 4           figuring out the puzzle on an annual basis.  

 5           But we -- I mean, as you said, we're so 

 6           grateful for the last couple of years of 

 7           funding, recognizing the huge impact on the 

 8           sector that delivers so much to our state.  

 9           And, you know, look forward to being able to 

10           provide support to them as they come through 

11           and even have to reconfigure in response to 

12           this COVID -- to the COVID crisis.

13                  SENATOR SERRANO:  And a quick 

14           follow-up.  And I know that you touched upon 

15           this in your discussion with Senator Cooney.  

16           But how does NYSCA ensure that grantees will 

17           receive their money in a timely manner?

18                  NYSCA EXEC. DIR. MANUS:  So again, I 

19           think there may have been a mis -- or a -- we 

20           can probably improve our communications to 

21           the field that when we send them a grant 

22           award letter, that we also make sure they 

23           understand when that -- the contract actually 

24           starts.  While it does say 2023, people may 


 1           expect that on January 1st it's in their bank 

 2           account, which is something that we cannot 

 3           actually do within the state processes.  We 

 4           have to actually start processing on our end 

 5           come January 1st.

 6                  But as I mentioned, 78 percent of our 

 7           grants under $10,000 -- which, by the way, is 

 8           the majority of our grants that we make -- 

 9           funding that we -- yeah, the majority of the 

10           number of grants we make has gone out as of 

11           today.

12                  SENATOR SERRANO:  And I know Senator 

13           Cooney mentioned about regional arts 

14           councils, and I just want to talk a little 

15           bit more about that.  We've heard some 

16           concerns about this funding stream, including 

17           payment delays, limitations on award size -- 

18           which are often smaller, $5,000 or $10,000 

19           allotments.  Could you please lay out a bit 

20           of the grant-making process for allocating 

21           this 10 million to regional arts councils, 

22           describe the types of activities funded and 

23           the role that the regional councils have in 

24           selecting the grantees, and if there are any 


 1           parameters placed on this funding by NYSCA?  

 2                  NYSCA EXEC. DIR. MANUS:  Sure.

 3                  So our regional -- it's called SCRs, 

 4           statewide community regrant programs, 

 5           administered by 26 across the state.  They 

 6           are our partners in many ways, and we are 

 7           pleased to be able to continue working with 

 8           them.

 9                  I want to just make this distinction, 

10           which is there's a fundamental difference in 

11           the award that they give out versus what we 

12           give out.  So they provide project support.  

13           And the majority of that project support, 

14           those regrantees, goes to artist fees.  

15                  They do not provide organizational 

16           support.  That is provided by us.  And to 

17           organizations of all sizes, including those 

18           who have $50,000 budgets.  So if you are a 

19           small organization across the state, you're 

20           applying to us for organizational support.  

21           Which is one of many reasons that there's a 

22           cap on the project support.  By the way, the 

23           average size grant administered by the SCRs 

24           is about $1700, even though their cap is 


 1           about $5,000.

 2                  And again, these projects are created 

 3           and developed for -- created by artists, for 

 4           the most part, and therefore that constitutes 

 5           the majority of those fees.

 6                  SENATOR SERRANO:  Okay.  Thank you.

 7                  I do have a follow-up question, but I 

 8           think I'll wait for the second round because 

 9           I'm running short on time, Madam Chair.

10                  CHAIRWOMAN KRUEGER:  You only have 

11           three minutes on the second round, so think 

12           carefully.

13                  SENATOR SERRANO:  Okay.  Thank you.

14                  CHAIRWOMAN KRUEGER:  Thank you.

15                  CHAIRWOMAN WEINSTEIN:  Thank you.

16                  We go to Assemblyman Friend, our 

17           ranker, for five minutes.

18                  Just a reminder to the colleagues who 

19           aren't sitting by a microphone, that the end 

20           seats on both sides of the lower dais are for 

21           people who don't have a seat.  So that would 

22           be the microphone to use.

23                  CHAIRWOMAN KRUEGER:  Right.  So you'll 

24           have to give up your seat if someone else 


 1           needs it when they're asking questions.  Just 

 2           letting you know.

 3                  ASSEMBLYMAN FRIEND:  I'd like to thank 

 4           Chairs Weinstein and Krueger for allowing me 

 5           to participate on this panel.  

 6                  My comments and questions will be 

 7           directed to ESD.  I appreciate -- my first 

 8           comments can go back to the unemployment 

 9           insurance, like the previous Senator 

10           mentioned.  I appreciate that you applied for 

11           a waiver, but as we all recently saw, the 

12           Comptroller found significant fraud that 

13           occurred during those unemployment insurance 

14           payments.

15                  On top of that, many of these small 

16           businesses didn't have the opportunity to 

17           stay open like our big box stores or the 

18           liquor stores.  And for those reasons, I 

19           would think that it would have been nice, 

20           like the 31 other states, that we would have 

21           used some of that COVID funding to pay down 

22           that $8 billion that we currently owe.

23                  At the very least, if you can make a 

24           recommendation or the Legislature, in our 


 1           budget process, makes the recommendation to 

 2           at least allow those businesses that were 

 3           forced to close, given no opportunity to stay 

 4           open, given no guidance to stay open like 

 5           Walmart or the liquor stores, if we at least 

 6           paid off their unemployment insurance because 

 7           they could not stay open, they could not make 

 8           any money, they still kept their employees in 

 9           most cases, trying to go with the PPP and 

10           other programs that were out there.

11                  So that would be my recommendation.  

12           If you could pass that along, I'd really 

13           appreciate that.

14                  I'd like to then move on to the 

15           Buffalo Billion.  I realize that that was 

16           before your time here, and with a previous 

17           administration, but it's still something that 

18           we're dealing with.  And I'm not sure if you 

19           might have some updated numbers on employment 

20           at the Tesla, the Gigafactory.

21                  COMMISSIONER KNIGHT:  Yes, I do.  I 

22           have visited the Gigafactory at RiverBend, 

23           and we have received a report as of the end 

24           of last year:  Tesla has lived up to its 


 1           commitments at that facility with over 1700 

 2           people employed through the end of the year, 

 3           and we also have indication that they have 

 4           hired another 200 people since that time.

 5                  ASSEMBLYMAN FRIEND:  That's really 

 6           encouraging to hear.  And do you have any 

 7           idea if the -- all the equipment that 

 8           New York State paid for, is that still being 

 9           used?  Or is that sitting mothballed?

10                  COMMISSIONER KNIGHT:  So a large 

11           amount of that equipment is not being used.  

12           And I know that we were in the process of 

13           disposing of it.  

14                  Kevin, do you have an update?

15                  ESD COO YOUNIS:  Sure.  

16                  Thanks, Assemblyman.  Yes, some of 

17           that equipment was ultimately resold because 

18           the original tenant, what they were doing was 

19           very different, ultimately, than what Tesla 

20           was doing.  And so the equipment was sold on 

21           the market.

22                  ASSEMBLYMAN FRIEND:  It was sold?

23                  ESD COO YOUNIS:  Yes.  Some of it.  

24           Some of it.  Not all of it.


 1                  ASSEMBLYMAN FRIEND:  Okay.  And --

 2                  SENATOR RYAN:  I couldn't hear that.  

 3           Would you mind again?

 4                  ESD COO YOUNIS:  Some of that 

 5           equipment was sold that ultimately wasn't 

 6           used.

 7                  ASSEMBLYMAN FRIEND:  Okay.  So again, 

 8           my recommendation, with Micron moving into 

 9           the area, that equipment would be very 

10           valuable for other businesses to be able to 

11           start up.  And again, that would have been a 

12           great transfer or even for businesses that 

13           collocate there, in conjunction with 

14           supporting Micron moving into the state.

15                  So I appreciate your answers on that.  

16           And I would like to move to Micron next.

17                  Congratulations on bringing that huge 

18           industry to our state.  But there definitely 

19           are serious issues that we have to talk 

20           about.  And again, the energy was one of 

21           them, the fact that we're -- the CLCPA is 

22           going to require 100 percent renewable.  I'm 

23           really questioning how that's going to 

24           happen.  I mean, there is nuclear up in 


 1           Oswego, and if we add that to the mix, I 

 2           think that you could support that Micron 

 3           industry as well as all the other industries 

 4           that are going to need that intense amount of 

 5           energy.

 6                  But my other question with energy, on 

 7           the flip side, is the water that they're 

 8           going to use.  When we were considering 

 9           fracking in New York State, which was very 

10           big in the Southern Tier and is no longer 

11           allowed, water was one of those major 

12           concerns.  And we do currently have a permit 

13           in Tioga County to allow for a waterless 

14           fracking.  But you can't do waterless 

15           semiconductor chip manufacturing.  

16                  And in this instance, is there any 

17           processor or what are we looking to do to 

18           provide -- make sure that the residents and 

19           the other businesses in the Syracuse region 

20           are going to have clean, fresh water?

21                  ESD COO YOUNIS:  So, you know, one of 

22           the reasons that that site was selected was 

23           the abundance of water coming out of Oneida 

24           Lake and Lake Ontario.  And so there is 


 1           sufficient water.  But the conservation, 

 2           reuse is absolutely a big part of what their 

 3           commitments on sustainability will be about.

 4                  ASSEMBLYMAN FRIEND:  Okay.  All right.

 5                  I do have other questions as to 

 6           whether the Comptroller reviewed that report 

 7           or whether or not there were any hearings 

 8           before this was announced, because that's 

 9           similar to what happened with the Buffalo 

10           Billion and what we saw happen with the 

11           Gigafactory and how long that sat vacant.  

12           But my time is up, and I'll have to write and 

13           get those questions from you later.  

14                  Thank you.

15                  CHAIRWOMAN WEINSTEIN:  Thank you.

16                  We go to Senator Borrello for three 

17           minutes.

18                  SENATOR BORRELLO:  Thank you.  Just a 

19           quick comment on the arts.  You know, if the 

20           Spider-Man musical didn't kill Broadway, I 

21           don't think anything can.  So I think 

22           Broadway will be just fine.

23                  (Laughter.)

24                  SENATOR BORRELLO:  But that being 


 1           said, my questions are for 

 2           Commissioner Knight.  

 3                  First of all, thank you very much for 

 4           being here.  You know that I value what ESD 

 5           does.  As a business owner, you know, this is 

 6           one of the worst places in the world to do 

 7           business, certainly the worst place in 

 8           America to do business.  And ESD at least 

 9           provides a lifeline for some businesses.

10                  With that being said, I have a lot of 

11           concerns about this conversion to all 

12           electric.  You know, one of the biggest 

13           victories we've had, in my district 

14           especially, was the Great Lakes Cheese Plant.  

15           That plant cannot be built without natural 

16           gas.  What do we say to future Great Lakes 

17           Cheese Plants opportunities?  

18                  Also, you can't make glass unless you 

19           can heat it to 2300 degrees.  There is no 

20           technology that Corning is aware of to make 

21           glass.  One of the largest employers and one 

22           of the largest philanthropy organizations in 

23           New York State.

24                  Steel plants cannot make steel without 


 1           natural gas.  What is ESD's plan to address 

 2           the fact that we are not going to -- not only 

 3           are we not going to be able to attract new 

 4           businesses, but we are going to chase out 

 5           some of the largest employers in New York 

 6           State with this conversion to electric.

 7                  COMMISSIONER KNIGHT:  So thank you for 

 8           your question, Senator.

 9                  I was a member of the CLCPA, and I 

10           feel like I was able to bring a 

11           business/industries perspective to the group.  

12           DEC and NYSERDA are proposing a cap and 

13           invest program, and we're looking at 

14           providing allowances to businesses that are 

15           energy-intensive-trade exposed, as the ones 

16           that you have just mentioned, to be able to 

17           create a timeline so that this is a gradual 

18           introduction of renewable energy to these 

19           businesses that you cite.

20                  SENATOR BORRELLO:  But here's the 

21           problem.  You know, this whole cap and invest 

22           is really just a Hunger Games, right, because 

23           it's going to continue to decrease.  That 

24           means the biggest corporations are going to 


 1           be able to buy those credits, and the smaller 

 2           businesses, the smaller manufacturers, are 

 3           just going to be forced out.  And in the end, 

 4           we're not going to really have any impact on 

 5           climate change because those businesses are 

 6           just going to relocate -- in most cases, 

 7           probably right across the border in 

 8           Pennsylvania, in my district, where I border 

 9           Pennsylvania for more than 100 miles.

10                  So what's the long-term plan, if the 

11           technology doesn't exist, to ensure 

12           especially our small businesses and our small 

13           manufacturers can survive with this, you 

14           know, ridiculous idea?

15                  COMMISSIONER KNIGHT:  I think ESD will 

16           have a voice in the crafting of the program 

17           with respect to creating allowances, so that 

18           small businesses do have the opportunity, 

19           when the supply is available, for renewable 

20           energy for their businesses.

21                  SENATOR BORRELLO:  Well, I have a lot 

22           of concerns, because according to the 

23           businesses -- I know we've mostly taken this 

24           from environmentalists, but according to the 


 1           businesses, the technology just doesn't exist 

 2           and isn't going to.

 3                  So that's going to be a huge challenge 

 4           for you and for all of New York State.  So 

 5           thank you.

 6                  CHAIRWOMAN WEINSTEIN:  Thank you.

 7                  We go to Assemblyman McGowan, ranker, 

 8           five minutes.

 9                  ASSEMBLYMAN McGOWAN:  Good morning.

10                  So I guess my questions are for 

11           Commissioner Knight and Commissioner Moy.  

12           I'm really going to share with you generally 

13           my concern, and if I could hear your 

14           responses.

15                  You know, small business in New York 

16           State -- I think wherever you live, whether 

17           it's the city, a rural area or a suburban 

18           area like Rockland County, where I represent, 

19           small businesses are so vital to the services 

20           they provide to residents, the economic 

21           impact to the local community.  So we can't 

22           overstate that.

23                  But as my colleagues have shared 

24           concern of the issue of outmigration of 


 1           individuals leaving the state, but it's also 

 2           of businesses either shutting down or 

 3           closing.  And we're coming -- we're coming 

 4           out of the pandemic, we're coming to a place 

 5           where we want businesses to thrive -- you 

 6           know, large business but especially small 

 7           business to thrive.  

 8                  So I want to know from ESD and OGS 

 9           what's being done -- how does this budget 

10           affect kind of the outreach to these small 

11           businesses, retention efforts, to help 

12           struggling businesses, to allow them 

13           opportunities for grants or incentives or 

14           different programs that could aid them?  Are 

15           things being done or contemplated through 

16           this budget -- outreach to local business 

17           associations, chambers of commerce, things 

18           like that.  And that's really kind of my 

19           focus, and I'd love to hear your response and 

20           specifically how this budget affects that.

21                  COMMISSIONER KNIGHT:  So I'll start.

22                  We have a number of programs available 

23           at ESD for small businesses, almost a dozen 

24           capital access programs.  And I have flyers 


 1           you can bring to your constituents to see 

 2           what are the programs that we provide.

 3                  We also have -- are working with the 

 4           Department of Labor on a Business Express 

 5           platform that will update the existing 

 6           website to create more information for 

 7           technical assistance and support for 

 8           businesses, and staff a 24/7 hotline so that 

 9           owners that don't want to go to a website can 

10           actually pick up the phone and call someone 

11           and get assistance.

12                  ASSEMBLYMAN McGOWAN:  So those 

13           programs, is there active outreach, though?  

14           I mean, is there outreach to -- like I 

15           mentioned, like a local chamber of commerce 

16           or a business association, to again, either 

17           electronically or in person, to let them know 

18           that, hey, if you know about a struggling 

19           business -- you know, again, that might be 

20           something that's not directly accessible to 

21           your agency or to the state but would 

22           probably be known by the local business 

23           community.  Is there active outreach to those 

24           folks?


 1                  COMMISSIONER KNIGHT:  There is active 

 2           outreach to chambers of commerce, other 

 3           business associations.  We also have active 

 4           outreach to the Legislature and your offices, 

 5           and we provide, you know, social media, 

 6           internet tiles so that you can get the word 

 7           out to your constituents that own businesses.

 8                  ASSEMBLYMAN McGOWAN:  And does this 

 9           budget support that?  Is there a decrease, is 

10           there an increase?  I mean, is it the same?  

11           Are we able to do that with this budget, is I 

12           guess my question.

13                  COMMISSIONER KNIGHT:  We're able to do 

14           that with this budget.  That is part of the 

15           work that we do on a normal course of 

16           business, and so we are able to support it 

17           with this budget.

18                  ASSEMBLYMAN McGOWAN:  Okay.  Thank 

19           you, Commissioner.  

20                  Commissioner Moy?

21                  OGS COMMISSIONER MOY:  Absolutely.

22                  (Discussion off the record.)

23                  ASSEMBLYMAN McGOWAN:  Yes, thank you.

24                  OGS COMMISSIONER MOY:  Wonderful.  So 


 1           two things to note.  One is part of OGS is 

 2           our Service Disabled Veteran Owned Business 

 3           program, so we do certifications for 

 4           service-disabled veterans.  And this is one 

 5           of the items I was speaking with Senator 

 6           Cooney about.  We do a significant amount of 

 7           outreach, reminding individuals that you can 

 8           be a part of this program.  

 9                  We also oversee the centralized 

10           contracts on behalf of the state.  They're a 

11           $30 billion worth of spend that happens 

12           through our contracting process.

13                  And it's important for businesses to 

14           be able to know how to do business with the 

15           state.  It's one of the reasons why we're 

16           thrilled that the Executive Budget includes 

17           an e-procurement methodology.  We're looking 

18           to upgrade our systems so it's easy for 

19           individuals to be able to identify 

20           opportunities that happen with the state, 

21           know when contracts expire, know when they 

22           have the opportunity to respond to an RFP and 

23           become a vendor.

24                  So certainly outreach is an important 


 1           part of that work so that when those 

 2           businesses have an opportunity to be 

 3           competitive, that they know how to quickly 

 4           get on board to find the opportunity and be 

 5           competitive.  And that's one of the great 

 6           things about this Executive Budget, is we 

 7           take on what is a difficult and antiquated 

 8           process and we'll be modernizing it through 

 9           this year's Executive Budget.

10                  ASSEMBLYMAN McGOWAN:  And you 

11           mentioned that in your operating statement, 

12           talking about, you know, digital media 

13           services connecting state agencies and 

14           advancing such as the infrastructure; your 

15           procurement efforts and everything.

16                  So is that something that through this 

17           budget is going to be accomplished in this -- 

18           over the next year?  Is it going -- what's 

19           the rollout for that implementation and, I 

20           guess, revitalizing or upgrading your 

21           systems?

22                  OGS COMMISSIONER MOY:  Oh, that's a 

23           great question.

24                  So our Digital Media Services Center 


 1           is a shared service where we provide support 

 2           for other agencies who are building their own 

 3           digital campaigns, who are looking at their 

 4           online properties.  Our goal is to take on 

 5           these projects and support agencies to better 

 6           connect.  So happy to speak with you further 

 7           about that offline.

 8                  ASSEMBLYMAN McGOWAN:  Thank you so 

 9           much.

10                  OGS COMMISSIONER MOY:  Thank you very 

11           much, Assemblymember.

12                  CHAIRWOMAN KRUEGER:  Thank you.

13                  CHAIRWOMAN WEINSTEIN:  Senate?

14                  CHAIRWOMAN KRUEGER:  Senator John Liu.

15                  SENATOR LIU:  Thank you very much, 

16           Madam Chair.  

17                  I want to thank the entire panel for 

18           joining us this morning.  And I want to -- I 

19           just wanted to ask Commissioner Knight a 

20           couple of questions.  

21                  Remember a year ago when I 

22           congratulated you, I gave you my condolences.  

23           Are you feeling it now?

24                  COMMISSIONER KNIGHT:  No.


 1                  SENATOR LIU:  You're still excited, 

 2           okay.

 3                  (Laughter.)

 4                  SENATOR LIU:  You know, Assemblymember 

 5           Friend just asked you about both Micron as 

 6           well as the Buffalo Billion.  So is Tesla 

 7           completely out of the picture in Buffalo?

 8                  COMMISSIONER KNIGHT:  No.  Tesla is in 

 9           the facility.

10                  SENATOR LIU:  So they're still there.

11                  COMMISSIONER KNIGHT:  Yes, at the 

12           RiverBend facility.

13                  SENATOR LIU:  Even though they weren't 

14           mentioned as part of that, right?

15                  And what about Panasonic?  Are they 

16           completely out?  I think they had withdrawn.

17                  COMMISSIONER KNIGHT:  Panasonic is 

18           completely out, yes.

19                  SENATOR LIU:  Okay.  Last year we 

20           talked a little bit about -- and I spoke with 

21           your predecessors about the database also.  

22           I'm glad to see the database is up and 

23           running.  You know, our chairman Sean Ryan 

24           says that it could use some improvement, 


 1           which it could.  But at least it's there.

 2                  Now, I'm looking for Tesla.  It's not 

 3           even in the database anywhere.  Is that -- am 

 4           I searching for the wrong word?

 5                  COMMISSIONER KNIGHT:  It is in the 

 6           database.

 7                  SENATOR LIU:  I clicked download; I 

 8           downloaded the whole thing --

 9                  ESD COO YOUNIS:  If it's not -- so in 

10           that case, the funding went to the 

11           not-for-profit Fuller Road, and they built 

12           the facility.  So Tesla --

13                  SENATOR LIU:  What's the name of the 

14           nonprofit?  Does anybody know that there's a 

15           nonprofit involved?

16                  ESD COO YOUNIS:  Yeah.  Yeah.

17                  SENATOR LIU:  Really?

18                  ESD COO YOUNIS:  Yeah.

19                  SENATOR LIU:  Most people think of it 

20           as a Tesla deal.

21                  ESD COO YOUNIS:  Yeah, Tesla did not 

22           receive any support directly.  In fact, Tesla 

23           wasn't the original tenant.  It was a 

24           separate tenant.


 1                  SENATOR LIU:  I also searched Micron.  

 2           Micron's not in there either.

 3                  ESD COO YOUNIS:  That hasn't even 

 4           started yet.

 5                  SENATOR LIU:  I mean, I just -- I 

 6           don't know, I guess I'm just super-naive 

 7           here.  When we hear -- when we see huge 

 8           stories about Micron, about Tesla, about 

 9           other companies, I would think that a 

10           database of deals would at least include a 

11           reference.  If they didn't actually get the 

12           money per se, maybe somehow they're connected 

13           to that particular deal that's in the 

14           so-called database of deals.  Or is that too 

15           much to ask?

16                  COMMISSIONER KNIGHT:  Well, the Micron 

17           project will be in the database of deals.

18                  SENATOR LIU:  Oh, so it's not -- it's 

19           not started yet, that's why it's not in --

20                  COMMISSIONER KNIGHT:  It's not, that's 

21           right.  It hasn't started yet.

22                  SENATOR LIU:  So the database of deals 

23           only deals with projects that have already 

24           commenced.


 1                  COMMISSIONER KNIGHT:  Yes.

 2                  SENATOR LIU:  Okay.  Is it too much to 

 3           ask to have some kind of reference to Tesla?

 4                  COMMISSIONER KNIGHT:  We can provide 

 5           you information with --

 6                  SENATOR LIU:  Well, not me.  I mean, I 

 7           think everybody -- lots of other people want 

 8           to know too.  Maybe include that in the 

 9           database.  And more so, include the names of 

10           companies involved in these economic 

11           development deals.

12                  CHAIRWOMAN KRUEGER:  Thank you, 

13           Senator.  We're going to cut that off.  

14           Sorry.

15                  SENATOR LIU:  Thank you.  Thanks for 

16           not using the gavel on me.

17                  (Laughter.)

18                  CHAIRWOMAN WEINSTEIN:  We go to 

19           Assemblyman Simone for three minutes.

20                  ASSEMBLYMAN SIMONE:  Thank you.  

21                  Thank you all for testifying.  Thank 

22           you, President Knight.  This question is for 

23           you.

24                  I'd like to ask you about the Penn 


 1           Station project.  All levels of government 

 2           agree it's essential that we have a fabulous 

 3           new Penn Station that we can be proud of.  

 4           Unfortunately, we do not have a plan that has 

 5           any unified support right now.  Local elected 

 6           officials oppose the plan, and Senator 

 7           Schumer has called on the state to 

 8           compromise.  With Vornado having declared it 

 9           cannot provide funding for years, maybe a 

10           decade, the GPP appears dead.

11                  Isn't it time to consider a new 

12           approach, put together another state finance 

13           plan, in coordination with the federal 

14           government, to expedite the Penn project with 

15           no dependence on a private developer who is 

16           in a fiscal crisis?

17                  Second, why is the project to rebuild 

18           the busiest transit hub in the Western 

19           Hemisphere not being led by a transit agency?  

20                  And last, ESD has ignored the presence 

21           of Madison Square Garden, which sits on top 

22           of Penn Station.  Why has the state not 

23           pushed to end MSG's tax abatement of nearly 

24           50 million a year to help fund the 


 1           reconstruction, which would massively, 

 2           massively benefit MSG if it remains in the 

 3           current location?

 4                  COMMISSIONER KNIGHT:  So thank you for 

 5           your questions, Assemblymember.

 6                  I'll start with the Penn plan as it 

 7           stands right now.  We are in partnership with 

 8           the MTA, Amtrak, New York Transit, and we 

 9           continue to talk to the majority property 

10           owner to execute a project pursuant to the 

11           GPP.  We believe that the value capture 

12           scheme is the best way to fund transit 

13           improvements.  We are working with Amtrak, 

14           who is currently undertaking a federal review 

15           process, and that process will be over in 

16           2026.  And we'll be able to begin working 

17           through whether or not there's a southern 

18           expansion and work with the developer to get 

19           the first several projects up.

20                  ASSEMBLYMAN SIMONE:  Thank you.

21                  CHAIRWOMAN WEINSTEIN:  Thank you.

22                  To the Senate.

23                  CHAIRWOMAN KRUEGER:  Thank you.

24                  Senator Walczyk.


 1                  SENATOR WALCZYK:  May I have five?  

 2           Awesome.

 3                  CHAIRWOMAN KRUEGER:  Oh, you are a 

 4           ranker.  Yes, you are.  Yes, you may.

 5                  SENATOR WALCZYK:  Thanks, Madam Chair.  

 6           Appreciate it.

 7                  Ms. Manus, why is Hollywood 280 times 

 8           more important to the Governor than our local 

 9           and regional tourism systems?

10                  NYSCA EXEC. DIR. MANUS:  I think I'll 

11           direct that to my colleague Commissioner 

12           Knight, since she's --

13                  COMMISSIONER KNIGHT:  Film falls under 

14           the ESD, yes.  So thank you for your 

15           question.  

16                  The film and television industry is 

17           very important to the state's economy.  You 

18           know, for every dollar of incentive that we 

19           provide, we get $9 of economic benefits.  And 

20           so we're looking to increase the support for 

21           the cap on the film and television industry 

22           credit so that we can begin to expand the 

23           industry, fight off a little bit of the 

24           competition that we have from neighboring 


 1           states who have been taking some of our 

 2           productions away over the last two years.

 3                  SENATOR WALCZYK:  So Hollywood can get 

 4           reimbursed or get a post-production film 

 5           credit for up to 25 percent, and the Governor 

 6           is increasing the fund from $420 million last 

 7           year to $700 million this year, a 

 8           $280 million increase.  

 9                  I appreciate that you brought the 

10           nine-to-one ratio here.  I don't believe in 

11           that return on investment.  I haven't seen 

12           it, and most of New York doesn't see that.  

13           They see the films that are produced, and 

14           they may be able to watch them on Netflix, 

15           but that doesn't mean they see any benefit in 

16           their local communities.

17                  And here's the point that I want to 

18           leave you with.  At the same time that you're 

19           adding $280 million for Hollywood, you've 

20           continually reduced, over time, and the 

21           Governor is continuing this trend, what is a 

22           very small match for local tourism dollars.  

23           So we do know this ratio, because counties 

24           across New York State leverage what is a very 


 1           small amount of the total pot in New York 

 2           State.  And she's reduced, in her budget -- a 

 3           few years ago there was $5 million for the 

 4           tourism matching grants program.  It was 

 5           reduced last year to 3.45 million.  And this 

 6           year she's proposing to reduce it again to 

 7           2.45 million.  

 8                  I would just communicate to you that 

 9           our local tourism dollars do bring a lot by 

10           way of sales tax, bed tax.  All of the 

11           industries, whether it's summer, winter, 

12           shoulder -- our communities, many of them 

13           across New York State, survive on these 

14           tourism industries.  And it's a very small 

15           amount in comparison to what we're investing 

16           in things like Hollywood.  

17                  So please send that back to the 

18           Governor, and I hope to see it negotiated at 

19           the table.  And I know my colleagues on both 

20           sides of the aisle are hearing me, so I hope 

21           they take that back.

22                  My next question is -- you know, in 

23           hearing housing issues, many folks have said 

24           that nobody should spend more than 30 percent 


 1           of their income on housing.  Which I can 

 2           appreciate that we've brought that to the 

 3           table.  How much should New York State spend 

 4           in GDP on their government?  What percentage 

 5           of New York State's GDP should go to overall 

 6           government spending?

 7                  COMMISSIONER KNIGHT:  I have not 

 8           looked at that, but I can come back to you 

 9           after taking a look at that.

10                  SENATOR WALCZYK:  I would think 

11           someone with the title of commissioner of 

12           Empire State Development and the Department 

13           of Economic Development would give that some 

14           consideration, and I would love to hear a 

15           good number back from you.  Thanks very much.

16                  And then my final one is for OGS.  How 

17           are you?  Prison redevelopment.  I didn't see 

18           it in your testimony.  We have many prisons, 

19           and the Governor said she was going to get 

20           very creative about redeveloping the prisons 

21           that were shuttered recently.  Creativity so 

22           far has been one visit to each one of the 

23           prisons, and then we had to beg just to keep 

24           the heat on.


 1                  What is the plan for prison 

 2           redevelopment?

 3                  OGS COMMISSIONER MOY:  This is 

 4           something that we work very closely with the 

 5           Economic Development Corporation on -- sorry, 

 6           Empire State Development Corporation.  

 7                  The role for OGS and what we've been 

 8           doing, we are -- we do the design and 

 9           construction work on behalf of the Department 

10           of Corrections and Community Supervision.  We 

11           have made some recommendations about how to 

12           maintain the facilities and how best to 

13           transfer them over.  It's been a very 

14           collaborative process to identify ways in 

15           which we can look towards reuse of those 

16           buildings and adaptive reuse.  A lot of our 

17           recommendations as a part of that commission 

18           related to understanding infrastructure, 

19           sharing that information with developers, 

20           making sure that it's easily discoverable, 

21           and smoothening over that transition.  That 

22           was OGS's role.

23                  SENATOR WALCZYK:  What's the dollar 

24           amount that the Governor has proposed in this 


 1           year for prison redevelopment?

 2                  OGS COMMISSIONER MOY:  I will have 

 3           to --

 4                  COMMISSIONER KNIGHT:  There is not 

 5           funding in the budget for an amount --

 6                  SENATOR WALCZYK:  Yeah, I didn't see 

 7           it either.  All right.  Thank you.

 8                  CHAIRWOMAN KRUEGER:  Thank you.

 9                  Assembly.

10                  CHAIRWOMAN WEINSTEIN:  Assemblywoman 

11           Woerner.

12                  ASSEMBLYWOMAN WOERNER:  Thank you, 

13           Madam Chairwoman.

14                  And thank you all for testifying 

15           today.  And, you know, until Micron puts the 

16           foundation in, I still have the largest 

17           semiconductor chip plant in North America, 

18           and I'm very proud of that.  And I appreciate 

19           the work that you're doing to grow that 

20           industry.

21                  But my question is for Ms. Manus about 

22           the arts today.  So I note that you are 

23           programmed to take a 56 percent cut in the 

24           allocation this year.  So I'm wondering, in 


 1           your testimony you said that you saw a 

 2           25 percent increase in applications in fiscal 

 3           year 2022.  And so I'm wondering, of the 

 4           number of applications you saw last year, 

 5           what percent were you able to fund with the 

 6           allocation you received?

 7                  NYSCA EXEC. DIR. MANUS:  I think I 

 8           need to revert or look at this large chart 

 9           that's in front of me and get back to you at 

10           the end of this testimony.

11                  But roughly we fund, you know, year 

12           over year, rough numbers look like 

13           70 percent-ish?

14                  ASSEMBLYWOMAN WOERNER:  About 

15           70 percent.  So you've got -- so even with 

16           the amount that you received last year, you 

17           had about a 30 percent unmet need.

18                  NYSCA EXEC. DIR. MANUS:  Correct.

19                  ASSEMBLYWOMAN WOERNER:  So with a 

20           56 percent cut this year, have you estimated 

21           what your unmet need among all of the 

22           statewide arts organizations or arts 

23           organizations statewide would be?

24                  NYSCA EXEC. DIR. MANUS:  We have not.  


 1           But I'm happy to do those calculations and 

 2           revert with an answer.

 3                  I will say that one thing that we've 

 4           done separate of the years that we received 

 5           recovery -- because as you know, we've had a 

 6           pretty steady state budget for a very long 

 7           time -- is that we raised our floor and 

 8           dropped our ceiling on our grant sizes.  So a 

 9           lot of organizations used to get much larger 

10           grants; they do not.  But the small 

11           organizations get bigger grants, because 

12           that's where we can have the most impact.

13                  ASSEMBLYWOMAN WOERNER:  And certainly 

14           I have a number of those organizations in my 

15           district, and they are -- they and I are very 

16           grateful for that level of support and hope 

17           that it can continue into the future. 

18                  We are not -- we may be through with 

19           the most -- the worst of COVID, but I think 

20           our arts organizations are still dealing with 

21           the impact of that in terms of reduced -- 

22           reduced reserves.  And so I think we need to 

23           continue that.

24                  And I would just -- I would use my 


 1           last 38 seconds for OGS.  You're doing 

 2           capital renovation projects, and as a 

 3           preservationist, I'm really thrilled about 

 4           that.  But I just have to ask, when are the 

 5           elevators in this building going to get 

 6           fixed?

 7                  (Laughter; applause.)

 8                  ASSEMBLYWOMAN WOERNER:  And the 

 9           escalators?

10                  OGS COMMISSIONER MOY:  We are -- we 

11           are modernizing the elevators.  The last one 

12           should be coming into production relatively 

13           soon; I'll come back to you with an exact 

14           date on it.

15                  But it is something where I -- I will 

16           make sure you have a date on that execution.  

17           I believe it is this year.

18                  ASSEMBLYWOMAN WOERNER:  Thank you.

19                  CHAIRWOMAN WEINSTEIN:  Thank you.

20                  Senate.

21                  CHAIRWOMAN KRUEGER:  Senator Michele 

22           Hinchey.

23                  SENATOR HINCHEY:  Thank you.  I think 

24           we would all love that data, so if you could 


 1           provide that to everybody, that would be 

 2           great.

 3                  OGS COMMISSIONER MOY:  Absolutely.

 4                  SENATOR HINCHEY:  My questions are for 

 5           Commissioner Knight.

 6                  Cell service, or lack thereof, is a 

 7           safety issue.  And I would argue it's also an 

 8           economic development issue.  What do you 

 9           believe is the state's role in ensuring that 

10           we have reliable cell service across our 

11           state?  And what kind of funding should be 

12           allocated to that?

13                  COMMISSIONER KNIGHT:  So as you 

14           know -- thank you for your question -- 

15           providers, service providers have different 

16           cell coverage areas, and sometimes they don't 

17           overlap, which provides gaps in services.  

18           And so that's what you're experiencing.

19                  The ConnectALL initiative that ESD is 

20           overseeing will be providing municipalities 

21           with a cellular 5G Siting Guide to provide 

22           more guidance to municipalities and 

23           jurisdictions around cell service and working 

24           with providers so that we can eliminate many 


 1           of those gaps in services.

 2                  SENATOR HINCHEY:  Thank you.  I mean, 

 3           I represent four counties; one of them is 

 4           nearly almost an entire country without 

 5           cellphone service.  And so this is something 

 6           we need to get on pretty quickly.  And I 

 7           appreciate the ConnectALL initiative and look 

 8           forward to working with you on that.

 9                  Which leads me to my next question on 

10           ConnectALL.  We together allocated 

11           $1.5 billion to that ConnectALL initiative, 

12           specifically with broadband.  Happy to hear 

13           it includes cellphone service -- some 

14           federal, some state.  Can you provide an 

15           update on the status of that money?  Because 

16           I know we've also put parameters in place 

17           requiring information to the Legislature 

18           every six months when those grants are out, 

19           and I don't believe we've heard any update.

20                  COMMISSIONER KNIGHT:  So thank you for 

21           that question.

22                  We are working with the federal 

23           government on the lion's share of the 

24           funding, so some of it was ARPA money, some 


 1           of it was IIJA, and we expect some of that 

 2           funding to start to flow at the end of this 

 3           year.

 4                  There was $300 million in the State 

 5           Budget that we will be using to support 

 6           projects that don't cover the projects that 

 7           will be funded by the federal money.  We 

 8           started with a couple of pilot projects in 

 9           Central New York, working on existing 

10           infrastructure, and look forward to rolling 

11           out more.

12                  SENATOR HINCHEY:  Thank you.  I'd be 

13           curious how those pilot projects were 

14           selected in those communities, whether that's 

15           based on the mapping that was done from the 

16           PSC or how we got to that place, and making 

17           sure that we can also provide more language 

18           for last-mile buildout, right, because I 

19           think we got pushback from the Second Floor 

20           in the budget last year on some of that 

21           last-mile buildout, and I would like to 

22           ensure that's where the money goes.

23                  In my last 10 seconds I'll just make a 

24           statement to I think generally we have a 


 1           challenge in our state of getting money out 

 2           the door.  And so I think it's incumbent upon 

 3           all of us here in the Legislature, the Second 

 4           Floor, and all of our agencies, to make sure 

 5           we can actually get the money to the places 

 6           and the people that we want to allocate it 

 7           to.  Thank you.

 8                  CHAIRWOMAN KRUEGER:  Thank you.

 9                  Assembly.

10                  CHAIRWOMAN WEINSTEIN:  We go to 

11           Assemblyman Otis, three minutes.

12                  ASSEMBLYMAN OTIS:  Thank you, Chair.

13                  And thank you all three of you for the 

14           great work that you and your agencies do.

15                  I am Steve Otis, chair of the Science 

16           and Technology Committee, so I'm going to 

17           move in semiconductor speed, since I have 

18           limited time and two topics I want to hit.

19                  The first, with OGS and Commissioner 

20           Moy, yesterday at our hearing on Education 

21           and in other -- through other sources we've 

22           heard concerns from school districts about 

23           their having the bandwidth to do the 

24           conversion to electric school buses, a lot of 


 1           the electric charging infrastructure on-site 

 2           that they have to cover.

 3                  So I'm wondering with the interagency 

 4           task force, does that task force that you're 

 5           part of and the skills that you have, are you 

 6           already or can OGS play a bigger role in 

 7           assisting school districts in terms of 

 8           addressing something they see as an obstacle?

 9                  OGS COMMISSIONER MOY:  Assemblymember, 

10           thank you for that question.

11                  OGS, in our capacity in procurement 

12           and in our work in partnership with NYSERDA 

13           and NYPA, have been a part of a solicitation 

14           for electric school buses.  We have gathered 

15           feedback from the school districts.  We have 

16           sent out a solicitation.  We've identified 12 

17           electric school bus vendors that are able to 

18           provide out those services for purchase.

19                  We are also working to make sure that 

20           the right contract methodologies are in 

21           place.  School districts leverage our 

22           contracts very much.  And to make sure that 

23           the EV equipment and the charging stations 

24           are ones they can purchase through our 


 1           contracts.

 2                  We do actively gather feedback from 

 3           vendors and from our authorized users on 

 4           whether or not the contracts are useful, and 

 5           we'll be looking to see how the feedback is 

 6           from those that are doing those purchases.  

 7           Happy to hear more from your constituents as 

 8           they come up.

 9                  ASSEMBLYMAN OTIS:  We'll stay 

10           connected on that.  

11                  And to connection, Hope, I want to 

12           talk a little more about the ConnectALL 

13           program and agree with Senator Hinchey's 

14           comments.  But the other piece of ConnectALL 

15           is digital inclusion.  And so I had a good 

16           call with your ConnectALL folks last week, 

17           and they're doing a great job.  

18                  One thing I would like to stress is 

19           for us to grow as quickly as possible the 

20           digital inclusion, digital equity work that 

21           they are a key part of.  You can share any 

22           comments or -- we have a little time.  But 

23           just a priority in terms of the digital 

24           literacy and digital equity issues around the 


 1           state.  What I'd like to see is to find other 

 2           sources of funding to try and jump-start some 

 3           of that, and I'm eager to work with you.

 4                  COMMISSIONER KNIGHT:  Yes, we're going 

 5           to begin to put together a digital equity 

 6           plan for the state, really focus on providing 

 7           devices to folks that don't have access to 

 8           them, and training so that folks have the 

 9           ability to use the internet and --

10                  ASSEMBLYMAN OTIS:  I would say that 

11           the digital equity plan, which is a 

12           requirement for some of the federal money, 

13           there are other federal funds and other funds 

14           we could be using in advance of that to give 

15           these programs more of a boost around the 

16           state.  So we'll continue the conversation.

17                  But thank you for the good work of 

18           that office and everyone else at ESD.  And 

19           our Regional Economic Development Council, 

20           I'll just put in a plug for them, they do a 

21           great job.

22                  COMMISSIONER KNIGHT:  Thank you.

23                  CHAIRWOMAN WEINSTEIN:  Thank you.

24                  Senate?


 1                  CHAIRWOMAN KRUEGER:  Thank you.

 2                  Senator Tom O'Mara, five minutes, 

 3           ranker.

 4                  SENATOR O'MARA:  Thank you.

 5                  Good morning.  Thank you for your 

 6           testimony and presence here today.

 7                  President Knight, unless I missed it, 

 8           I don't see any funding in the budget for the 

 9           Restore program, is that correct?

10                  COMMISSIONER KNIGHT:  That's correct.

11                  SENATOR O'MARA:  Why has that been 

12           eliminated?

13                  COMMISSIONER KNIGHT:  So we had 

14           funding for Restore in the last budget, and 

15           we are working to solicit requests for that 

16           funding from municipalities and 

17           jurisdictions, and continue to work through 

18           that on a forward basis.  So we're working 

19           through that funding that was put forward 

20           last year.

21                  SENATOR O'MARA:  There's a -- are you 

22           going to go through all the existing funding 

23           before next year?

24                  COMMISSIONER KNIGHT:  We have not gone 


 1           through all the existing funding at this 

 2           time.

 3                  SENATOR O'MARA:  How much is left?

 4                  COMMISSIONER KNIGHT:  I'd have to get 

 5           back to you with the number.  But I would say 

 6           less than half.

 7                  SENATOR O'MARA:  Well, that concerns 

 8           me.  That's been a very important program for 

 9           communities in rehabbing vacant and 

10           abandoned, blighted properties, and it's 

11           helped incentivize projects to help improve 

12           those types of sites in the state.  So I 

13           would hope that that could be revisited and 

14           make sure that we have sufficient funds to 

15           continue to provide for those types of 

16           projects.

17                  You know, with all the broad and 

18           varied economic development programs we have 

19           in the state, what is your focus of your 

20           department on the overall affordability of 

21           New York State?  I'd rather not have to have 

22           all these programs.  And if New York State 

23           was just more affordable from all aspects, we 

24           wouldn't need these programs.  


 1                  So what is being done, or what 

 2           recommendations are you making to make 

 3           New York State more affordable?

 4                  COMMISSIONER KNIGHT:  So we want to 

 5           make New York State a place where businesses 

 6           want to locate.  And I think that Micron is 

 7           an example of a company who's decided that, 

 8           after looking across the United States as 

 9           well as globally, decided that New York State 

10           had all of the assets that it needed to build 

11           one of the largest semiconductor facilities 

12           in the country.

13                  And so we continue to invest in 

14           creating those assets so that we can attract 

15           businesses to New York State because we will 

16           have the best to offer.

17                  SENATOR O'MARA:  Our track record in 

18           recent decades, frankly, has been loss of 

19           population, loss of businesses.  What 

20           specific things is New York State Economic 

21           Development doing to turn that around?

22                  COMMISSIONER KNIGHT:  We have a number 

23           of programs to support existing small 

24           businesses.  From a capital access 


 1           perspective, we've expanded our programs in 

 2           that regard.  We believe that we have 

 3           technical support for businesses.  I 

 4           mentioned that we are expanding our 

 5           Business Express platform.  

 6                  So we're trying to provide assets to 

 7           existing businesses, attracting new 

 8           businesses to the state with all that we have 

 9           to offer.

10                  SENATOR O'MARA:  Well, it doesn't seem 

11           to be working.  And by all accounts, you 

12           know, we're the most expensive state to do 

13           business in, most expensive state to live in.  

14           And I really think more focus needs to be 

15           given on lowering the everyday cost of living 

16           and doing business in New York State, since 

17           we're about the highest in every category 

18           that I can think of.  

19                  You know, it's very concerning to me 

20           that -- your answer to Senator Walczyk on 

21           prisons.  There's no funding in here for the 

22           redevelopment of these prisons that have been 

23           shut down.

24                  COMMISSIONER KNIGHT:  We will be 


 1           working on two prisons, Watertown and 

 2           Downstate, as a result of the Prison 

 3           Commission Redevelopment Project, and we'll 

 4           look at how we put those -- our piece for 

 5           other prisons out on a forward basis.

 6                  SENATOR O'MARA:  If something comes up 

 7           for one of these other prisons, what's going 

 8           to be available to them to help incentivize 

 9           those projects?

10                  COMMISSIONER KNIGHT:  We will be 

11           working with our partner agencies in the case 

12           that things do come up.  Like keeping prisons 

13           warm, we've worked with OGS to make sure that 

14           these prisons don't deteriorate in existing 

15           communities.  So we'll be working with our 

16           other partners on that.

17                  SENATOR O'MARA:  Thank you.

18                  CHAIRWOMAN KRUEGER:  Thank you.

19                  Assembly.

20                  CHAIRWOMAN WEINSTEIN:  We go to 

21           Assemblyman Jones, three minutes.

22                  ASSEMBLYMAN JONES:  Good morning.  Can 

23           everybody hear me?  Because I couldn't hear a 

24           darn thing back there for the last hour.  We 


 1           should shut that speaker off, honestly.  It's 

 2           kind of like a punishment or something, you 

 3           can hear every fifth word.

 4                  But great to be here, great to see 

 5           you.  I'm going to talk about the budget here 

 6           for a minute, and I'm going to ask all my 

 7           questions and hopefully you can answer them 

 8           in three minutes.

 9                  Restore NY, I don't see a reapprop for 

10           that.  It's gone.  It's a great program.  I 

11           have 18 municipalities and organizations 

12           right in my district right now that have 

13           applications in on it.  I understand it's a 

14           rolling application.  I don't know why we 

15           didn't reappropriate for that.

16                  Shovel Ready, Senator Cooney and 

17           myself put in that bill last year with the 

18           support of Mr. Bronson back there.  We wanted 

19           200 -- or we wanted 500 million, we got 200 

20           million.  I don't see a reapprop for that.  I 

21           understand it's been slow getting out, but 

22           good program, love to see a reapprop for 

23           that.

24                  NYSCA, obviously we need to do 


 1           something there.

 2                  1.4 billion, I know Senator Hinchey 

 3           mentioned it, but the ConnectALL, I did not 

 4           hear the answer.  That we appropriated a lot 

 5           of money last year.  We have been doing a 

 6           pretty good job in the Broadband Program, but 

 7           I still get calls from my constituents saying 

 8           they need broadband hookups.  This is my 

 9           seventh year here; I mention it every time.  

10                  Thank you for acknowledging that we 

11           still have an issue with it, but we have to 

12           get that money out the door and really would 

13           like to, you know, understand that.

14                  Also mentioned was cellular.  Still  

15           having huge issues with it upstate.  I was 

16           actually on the Upstate Cellular Task Force, 

17           can you believe that, three years ago.  What 

18           have we done in this -- now I turn to you.  

19           What have we done for the recommendations 

20           that came out of that?  We worked on it, 

21           there was a report that was filed.  What are 

22           the recommendations that have been 

23           implemented that have come out of that?

24                  Thank you.


 1                  COMMISSIONER KNIGHT:  So thank you for 

 2           your questions.  I'll answer the last one 

 3           first.

 4                  With respect to the Cellular Task 

 5           Force, we've taken those recommendations and 

 6           we'll be putting together this 5G Siting 

 7           Guide for municipalities to create a 

 8           user-friendly way for municipalities to be 

 9           able to work with service providers to create 

10           more service coverage.

11                  ASSEMBLYMAN JONES:  Okay.  We're going 

12           to have to be very unique about that in the 

13           Adirondacks; you know the limitations there.  

14           So, I mean, we're going to have to work on 

15           that.

16                  What was the -- I guess the idea 

17           behind not reappropriating money for these 

18           programs that we get interested in and then 

19           we just kind of not claw back?  And I think 

20           they are great programs, I commend you for 

21           putting them up there in the first place, but 

22           you can't get everybody interested in it and 

23           then we don't reappropriate money for it:  

24           Shovel Ready and Restore.


 1                  COMMISSIONER KNIGHT:  Well, we're 

 2           still working through those programs today, 

 3           and we're accepting applications and funding, 

 4           and so we will continue to do that until the 

 5           funding is exhausted.

 6                  ASSEMBLYMAN JONES:  Okay.  Thank you.

 7                  CHAIRWOMAN WEINSTEIN:  Thank you.

 8                  Senate?

 9                  CHAIRWOMAN KRUEGER:  Thank you.

10                  I think I'm going to take my time as a 

11           chair now.  I guess these are pretty much all 

12           for Hope Knight.

13                  So let's start with where my first 

14           colleague started us with the new Database of 

15           Deals.  And I also took an attempt to look 

16           through it and try to understand it.  And I'm 

17           not the best computer person, I admit.  So 

18           I'm going to see whether you could possibly 

19           get for me -- not now, but after this 

20           hearing, and I would share it with 

21           everyone -- let me just get the list.

22                  So a summary from your master list of 

23           how much in subsidy in total ESD has out 

24           there in deals; a master list of all the 


 1           programs and what the projects are for.  And 

 2           the status of each project.  So just almost 

 3           like one giant spreadsheet that gave us how 

 4           much money is out there on the table, where 

 5           are we in that project, what is it for.

 6                  COMMISSIONER KNIGHT:  Yes.

 7                  CHAIRWOMAN KRUEGER:  Do you have an 

 8           ability to use that database in that way?

 9                  COMMISSIONER KNIGHT:  Yes, we can 

10           provide that.

11                  CHAIRWOMAN KRUEGER:  And you can help 

12           us by just giving us -- I'm not even asking 

13           for it in paper, because I know it's huge.  

14           So just one spreadsheet that does all that --

15                  COMMISSIONER KNIGHT:  That we could 

16           forward to you.

17                  CHAIRWOMAN KRUEGER:  -- that would be 

18           very helpful.  Thank you.

19                  I think we discussed the -- and that 

20           would include the tax incentives that 

21           actually go through Tax and Finance, you have 

22           that information and that also is on the 

23           database?

24                  COMMISSIONER KNIGHT:  We have some of 


 1           the information, all of the ESD programs in 

 2           some -- from other agencies.

 3                  CHAIRWOMAN KRUEGER:  So but not from 

 4           all the agencies.

 5                  COMMISSIONER KNIGHT:  Not from all the 

 6           agencies.

 7                  CHAIRWOMAN KRUEGER:  Not from all the 

 8           agencies.  Okay, thank you.

 9                  My understanding is that there have 

10           been two models, historically, with economic 

11           development incentives:  Projects where the 

12           money is given up front -- say that Tesla 

13           deal, which I never thought was a very good 

14           idea; and then programs where the board 

15           doesn't even approve the money until after 

16           everything's been completed.

17                  So are we switching now more to we 

18           only give the money out when the project has 

19           been completed, so that we don't have to deal 

20           with those clawbacks that never seem to 

21           happen?

22                  COMMISSIONER KNIGHT:  So the lion's 

23           share of the incentives that we provide at 

24           ESD are pay for performance.  And so that 


 1           would require not really having to have a 

 2           clawback, because the funding is only 

 3           provided once the commitment is fulfilled.

 4                  CHAIRWOMAN KRUEGER:  And that Micron 

 5           deal that lots of people here seem to be very 

 6           happy about -- I'm a little nervous, myself, 

 7           but that's okay -- that will be pay for 

 8           performance?  They actually have to --

 9                  COMMISSIONER KNIGHT:  That will be pay 

10           for performance.

11                  CHAIRWOMAN KRUEGER:  -- come here and 

12           do what's been announced in order to get any 

13           of the incentives.

14                  COMMISSIONER KNIGHT:  Job creation, 

15           yes.

16                  CHAIRWOMAN KRUEGER:  Okay.  And so 

17           you're not concerned that currently they seem 

18           to be seeing their stock plummet and laying 

19           off 10 percent of their workforce.

20                  COMMISSIONER KNIGHT:  We're not 

21           concerned.  We understand that the 

22           semiconductor industry is very cyclical, and 

23           we're at a sort of bottom at the cycle and 

24           know that, you know, we'll have a turn up and 


 1           that that project will commence and start 

 2           building in 2024 with commencing operations 

 3           in 2026.  We anticipate that to happen.

 4                  CHAIRWOMAN KRUEGER:  And the Governor 

 5           in her budget address, or perhaps her State 

 6           of the State, or perhaps both, said that this 

 7           was going to bring in 50,000 jobs?

 8                  COMMISSIONER KNIGHT:  Yes.

 9                  CHAIRWOMAN KRUEGER:  So are you going 

10           to be able to give us a breakdown of what and 

11           where those jobs are?  Because as I 

12           understand it, there will obviously be 

13           construction jobs to build each plant, but 

14           then the plants themselves, once you get them 

15           operating, have a tiny crew of people in 

16           them.  So I can't figure out where we get 

17           50,000 jobs.

18                  COMMISSIONER KNIGHT:  So I'll talk a 

19           little bit about the 50,000 jobs.  That's 

20           50,000 jobs, Micron employees, construction 

21           as well as supply chain companies.  So we 

22           expect to have 9,000 jobs with the Micron 

23           plant when it's up and running at the end of 

24           the grant period.  There will be another sort 


 1           of 3-to-1 ratio of supply chain companies 

 2           that actually work in the plants that run the 

 3           equipment in the facility.  And so we expect, 

 4           you know, tens of thousands of jobs in the 

 5           Micron plant, not necessarily being employed 

 6           by Micron, but supply chain companies also.

 7                  CHAIRWOMAN KRUEGER:  So will you be 

 8           able to give us a master list of how you 

 9           think that will be breaking down?

10                  COMMISSIONER KNIGHT:  Yes.

11                  CHAIRWOMAN KRUEGER:  Yes, okay.  Thank 

12           you.  All right, so that's it for Micron for 

13           me right now.  

14                  Jumping back to the broader question 

15           of how we measure economic development 

16           subsidies, now that we have a database that 

17           will help us track, do we have a standardized 

18           cost-benefit analysis on each project that is 

19           also available to the public?

20                  COMMISSIONER KNIGHT:  When we look at 

21           our projects, particularly our tax credit 

22           programs, we do run a cost-benefit analysis, 

23           and it is included in our materials for our 

24           projects.


 1                  CHAIRWOMAN KRUEGER:  And those 

 2           materials are available to us where?

 3                  COMMISSIONER KNIGHT:  So it's 

 4           usually -- I know it's in the board materials 

 5           that we bring to the board.  I'm not sure 

 6           it's in the database.  We'll check for you.

 7                  CHAIRWOMAN KRUEGER:  Do you have a 

 8           projection of -- for your department of what 

 9           you think is a reasonable amount of public 

10           funds to spend to create one new job in 

11           private-sector employment?

12                  COMMISSIONER KNIGHT:  Well, we believe 

13           that if we are able to get more economic and 

14           fiscal benefit than we invest, state dollars 

15           invested, that is a good economic development 

16           program.

17                  CHAIRWOMAN KRUEGER:  But there's not a 

18           number that, you know, 50,000 is worth it, 

19           300,000 isn't worth it, something like that?

20                  COMMISSIONER KNIGHT:  I think we look 

21           at it specifically program by program because 

22           the metrics don't work, you know, sort of 

23           uniformly across all programs.

24                  CHAIRWOMAN KRUEGER:  Program by 


 1           program meaning area within the economy or a 

 2           deal?

 3                  COMMISSIONER KNIGHT:  Like with the 

 4           Excelsior job tax credit program.  You know, 

 5           a semiconductor project is going to be 

 6           different than, you know, an advanced 

 7           manufacturing project.  So we have to look at 

 8           it project by project.

 9                  CHAIRWOMAN KRUEGER:  And do you have a 

10           different number evaluation that you do to 

11           keep a job in New York?

12                  COMMISSIONER KNIGHT:  So we rarely are 

13           incenting pure retention deals in New York 

14           City.  We provide support for firms that want 

15           to expand, but pure retention, we rarely 

16           provide support for those kind of projects.  

17           Less than 1 percent.

18                  CHAIRWOMAN KRUEGER:  Film and tax 

19           credit.

20                  COMMISSIONER KNIGHT:  Yes.

21                  CHAIRWOMAN KRUEGER:  Historically in 

22           your materials to support the film and tax 

23           credit you've talked about it creating jobs 

24           and economic activity, and yet the materials 


 1           this year don't really seem to say that.  

 2           It's more just sort of keep everybody staying 

 3           here, but we're doubling the amount of money 

 4           we're going to provide.

 5                  So are we actually, at this point in 

 6           time, subsidizing the movie and TV industry 

 7           above and beyond the number of new jobs we're 

 8           getting?

 9                  COMMISSIONER KNIGHT:  No.  No, 

10           Senator, not at all.

11                  You know, the situation that we find 

12           ourselves in today is that many of our 

13           neighboring states are competing very 

14           vigorously with New York for productions.  

15           Many of the states that are neighboring us 

16           have no cap on their tax credit programs.  

17           And so they provide a richer credit with no 

18           cap on programs, and we've seen many, many 

19           productions leave New York, go to New Jersey.  

20           You know, just from a data perspective, 

21           New Jersey has seen 300 percent more 

22           productions and we've had a decrease of about 

23           25 percent over the last two years.

24                  And so we feel it's an urgent need to 


 1           increase our tax credit program as well as 

 2           the percentage of the tax credit.

 3                  CHAIRWOMAN KRUEGER:  So this is the 

 4           first year that you've also proposed a change 

 5           in the credit that would pay for jobs within 

 6           the industry in what the terminology is 

 7           called above the line --

 8                  COMMISSIONER KNIGHT:  Yes.

 9                  CHAIRWOMAN KRUEGER:  -- so that it 

10           would be, you know, paying for part of the 

11           salary of Brad Pitt, George Clooney, Jennifer 

12           Lawrence, Steven Spielberg as the director. 

13                  Do we really need to subsidize people 

14           at that level?  Why are we doing that?  We 

15           always said no to that before.

16                  COMMISSIONER KNIGHT:  So there again, 

17           you know, with respect to intense competition 

18           that we have with other states, there are 

19           other states that are providing support for 

20           above-the-line roles with no cap.  

21                  We're presenting a cap at $500,000 for 

22           those roles.  And just because we want to be 

23           competitive against other states who have 

24           been taking some of the productions that had 


 1           traditionally been here in New York.

 2                  CHAIRWOMAN KRUEGER:  So I don't have 

 3           any time left.  I'll just point out the 

 4           reason I was asking about the estimate of 

 5           what is being spent by us for what jobs, with 

 6           the film credit we show that there's 

 7           57,000 jobs being supported by this.  

 8                  But we don't know at what cost, when 

 9           you look at the math at 700 million, and we 

10           don't know at what cost for a small project 

11           in one of the upstate counties versus the 

12           Tesla plant, which apparently has plummeting 

13           fewer jobs than we ever imagined they would 

14           have.

15                  But we really need, I think, a hard 

16           and fast set of numbers that we can look at 

17           and hold all the projects up against and ask 

18           the really important question:  Is this a 

19           good use of taxpayers' money?  So that's what 

20           I'm hoping we can get to for evaluation.

21                  I've gone over my time.  Assembly.

22                  CHAIRWOMAN WEINSTEIN:  Ranker, 

23           Assemblyman Gray, five minutes.

24                  ASSEMBLYMAN GRAY:  Thank you, Chairs.  


 1           I appreciate it very much.

 2                  So I just wanted to double back on the 

 3           prisons, because I think I heard there was no 

 4           money allocated this year for prison 

 5           redevelopment.  Is that correct?

 6                  COMMISSIONER KNIGHT:  So there is no 

 7           money allocated, but we do have funds that 

 8           could support redevelopment and maintaining 

 9           the prisons so that we can look at economic 

10           development projects for repurpose.

11                  ASSEMBLYMAN GRAY:  Okay.  So in my 

12           district we have the Psych Center that was 

13           vacated back in the eighties and the 

14           buildings are still dilapidated, falling 

15           down.  Is that going to follow the same path 

16           as the Psych Center properties -- the prison 

17           redevelopment?  Or is there concrete plans to 

18           actually do something?  They're massive 

19           buildings, so they're going to be tough to 

20           repurpose.

21                  COMMISSIONER KNIGHT:  So the subject 

22           of the Prison Redevelopment Commission was 

23           really around prisons.  That was the focus.  

24           I know that --


 1                  OGS COMMISSIONER MOY:  The one thing I 

 2           would note that was incredibly comprehensive 

 3           about the work that took place during the 

 4           Prison Redevelopment Commission is making 

 5           sure that developers and others who might be 

 6           interested in the properties have full 

 7           transparency into the properties themselves.

 8                  And that is something that we know 

 9           that there needs to be transparency about the 

10           access to infrastructure, which portions of 

11           the sites can be redeveloped, which ones have 

12           access to transportation.

13                  And so those are areas in which we 

14           spent much of our time making sure that there 

15           is a comprehensive plan so that we can move 

16           forward and identify how to invest those 

17           funds.

18                  I think, to Commissioner Knight's 

19           point, it is a priority to identify what are 

20           the opportunities with existing pots of 

21           dollars in order to look at those areas.  But 

22           part of our priorities as part of the 

23           commission was to make sure, frankly, that we 

24           helped to responsibly transfer over these 


 1           properties to developers and bring it back to 

 2           the tax rolls.

 3                  I appreciate and I think we all 

 4           appreciate the perspective that, you know, 

 5           these prisons -- they are complex properties, 

 6           to your point.  They are all under different 

 7           and varying degrees of condition, and how 

 8           quickly they can return back.  One of the 

 9           biggest points of feedback that we've heard 

10           from the public has been around, you know, 

11           what am I buying if I get into these 

12           properties.  

13                  And that's why we've been trying to 

14           construct more information that provides for 

15           better and richer RFPs so that we can bring 

16           it back to the tax rolls appropriately.  

17                  Not to interject.

18                  ASSEMBLYMAN GRAY:  Thank you very 

19           much.  

20                  And I would just like to echo my 

21           colleagues that -- for the Restore NY program 

22           to be reinstituted.  

23                  Just one final thing.  The EV, the 

24           move to EV, what's the schedule for that 


 1           for -- in terms of the executive branch and 

 2           the legislative branch?

 3                  OGS COMMISSIONER MOY:  So the goal is 

 4           to have the entire 18,000 light-duty vehicles 

 5           to transition to EV by 2035.  And just to add 

 6           a little bit more color to that, we are in 

 7           the process of developing a responsible plan 

 8           for that transition.  Certainly when it comes 

 9           to EV vehicles, one of the priorities is 

10           making sure that we have infrastructure to be 

11           able to handle that -- the charging.

12                  So we are undergoing a study right now 

13           to identify where are the sites where we can 

14           locate Level 2 and Level 3 chargers in 

15           support of the EV fleet.  

16                  As a lot of the industry market 

17           studies have come out, they've shown that 

18           they believe there will be price parity 

19           between the EV vehicle and internal 

20           combustion engine for the next five to 

21           seven years.  Which is why our priority has 

22           been getting the infrastructure in place, 

23           piloting a number of EV vehicles to make sure 

24           that we are buying the right and best ones 


 1           for the State of New York.

 2                  ASSEMBLYMAN GRAY:  Thank you.

 3                  You know, I just think it's important 

 4           that we lead by example in terms of the 

 5           executive branch and the legislative branch, 

 6           so -- and as well as lead by example on the 

 7           properties.  Because I notice that you say 

 8           we're overseeing -- in your testimony, 

 9           overseeing capital projects responsible for 

10           public stewardship, modernizing state office 

11           buildings and things like that.  But our 

12           history has shown that we're not exactly 

13           stewards, and you have to look no further 

14           than the Psych Center up in Ogdensburg.

15                  OGS COMMISSIONER MOY:  I appreciate 

16           the feedback.  As commissioner, one of my 

17           priorities has been to make sure that we are 

18           managing both the fleet and buildings.  

19           Certainly with our partners in NYSERDA and 

20           NYPA and DEC, we know that one of the top 

21           contributors to greenhouse gas emissions are 

22           buildings and transportation, which is why 

23           that's where we're focused at this exact 

24           moment in time.


 1                  We've had a great track record of the 

 2           conversion of at least one of our steam 

 3           chillers here in the Empire State Plaza, 

 4           which is reducing greenhouse gas emissions.  

 5           Our goal right now is to create an inventory 

 6           so we know, in partnership with NYSERDA, 

 7           where the greatest emitters of greenhouse 

 8           gases are so we can prioritize them 

 9           responsibly in the upcoming budgets.  

10                  But I do appreciate the feedback.  

11           Thank you.

12                  ASSEMBLYMAN GRAY:  Thank you very 

13           much.  I appreciate your time today, and best 

14           wishes.  Thank you.

15                  OGS COMMISSIONER MOY:  Thank you.

16                  CHAIRWOMAN KRUEGER:  Thank you.

17                  Senator Sean Ryan for his three-minute 

18           second round.

19                  SENATOR RYAN:  Trying to go lightning 

20           round here.

21                  First, I want to thank Assemblymember 

22           Woerner for her best questions of the day, 

23           the escalator -- elevator question.  But add 

24           on the escalator to that too, because there's 


 1           an escalator that's been defunct for I think 

 2           a decade.  You don't have to answer that 

 3           now --

 4                  OGS COMMISSIONER MOY:  Well, I'm happy 

 5           to answer that now, actually, Senator.

 6                  So first, the Elevator 4 is in the 

 7           process of being repaired.  I do have an 

 8           update on that, I apologize.  We were waiting 

 9           for parts; they were supposed to be in on 

10           Thursday.  We anticipate that it will be back 

11           in service relatively soon so long as there's 

12           no additional damage as we install them.

13                  But we do anticipate that we'll be 

14           bringing Elevator 4 back.

15                  Insofar as the escalators, so they 

16           have been out of service for about a decade.  

17           When it was initially assessed, the cost of 

18           it was prohibitively high to repair the 

19           escalators.  The priority was on the 

20           elevators to make sure they were in working 

21           order.  That's where we put in our capital 

22           investment.  And so there's no plan at this 

23           time to restore the escalators.

24                  SENATOR RYAN:  It does give an 


 1           impression of sort of not being tended to.  

 2           So I've seen in the past when escalators were 

 3           not repaired, they boxed them off so it did 

 4           not look like a broken escalator.

 5                  OGS COMMISSIONER MOY:  I will take it 

 6           under advisement.

 7                  CHAIRWOMAN KRUEGER:  Give Sean a 

 8           minute back, because he really asked that 

 9           question on behalf of all of us.

10                  (Laughter.)

11                  OGS COMMISSIONER MOY:  I will 

12           certainly look at signage and make sure that 

13           we can think through other ways of dealing 

14           with that out-of-service elevator -- 

15           escalator.

16                  SENATOR RYAN:  Thank you.

17                  And then going real quick to the arts, 

18           you know, thank you for what you've done as 

19           the director.  I appreciate it.  I've seen 

20           you all around the state.  We appreciate 

21           that.

22                  But, you know, just looking at your 

23           funding, in '18 you were at 46.9 million; now 

24           you're back to just 48 million.  Once again, 


 1           following up on Assemblywoman Woerner, you 

 2           know, based on your demand, what do you think 

 3           your budget should be?

 4                  NYSCA EXEC. DIR. MANUS:  You know, I 

 5           have an update for Assemblymember Woerner and 

 6           for you, actually, about the numbers from the 

 7           last year.  So it was 79 percent that we 

 8           funded, not 70 percent.  So we were able to 

 9           support more demand.

10                  If we have continued demand, 

11           especially in light of the COVID impact, we 

12           are going to have to seriously recalibrate 

13           our processes and pivot.  In terms of -- you 

14           know, if we can -- 80 percent or 79 percent, 

15           to be able to provide that to the field at 

16           this time, it seems like an investment that 

17           will pay off in many ways for our economy.

18                  I also wanted to -- there's a question 

19           I hope I could answer about our volume and 

20           our timely payments.  So just for 

21           perspective, we're one of the smallest 

22           agencies and we move the largest volume of 

23           contracts in the state.  We have, so this 

24           year, 2,000 letter agreements, 1600 


 1           contracts.  

 2                  So we are going to continue to improve 

 3           our processes, but just wanted to provide 

 4           some context on that.

 5                  SENATOR RYAN:  Thank you.

 6                  And then back to Commissioner Knight, 

 7           the question about Restore NY.  I believe you 

 8           testified that about half of last year's 

 9           budget wasn't spent -- was unspent.  But was 

10           money from previous years unspent?  Is there 

11           cash in the drawer for the Restore NY 

12           program?

13                  COMMISSIONER KNIGHT:  I don't believe 

14           there's cash in the drawer for the Restore 

15           program.  But like I said, we continue to 

16           work through the amount that was allocated 

17           for last year at this time.

18                  SENATOR RYAN:  Do you have 

19           applications in that exceed the amount that 

20           we budgeted for last year?

21                  COMMISSIONER KNIGHT:  Not at this 

22           time.

23                  SENATOR RYAN:  That's excellent.   

24           Thank you very much.


 1                  CHAIRWOMAN KRUEGER:  Thank you.

 2                  Assembly.

 3                  CHAIRWOMAN WEINSTEIN:  We go to 

 4           Assemblywoman Fahy.

 5                  ASSEMBLYWOMAN FAHY:  Thank you.

 6                  And I had to step out for a Majority 

 7           conference call, so I apologize if I'm 

 8           repeating a couple of things.  But I've got a 

 9           couple of questions, mostly for OGS, but just 

10           want to start with a couple of comments.

11                  Thank you for the responsiveness from 

12           each of you.  We've had some just terrific 

13           recent conversations with ESD and the 

14           Governor's office regarding Harriman Campus 

15           as we look to redo the Wadsworth public 

16           health labs, and appreciate that the 

17           Governor's put the funding in for that.  And 

18           tying that into a redo of the entire campus, 

19           which is the worst of 1960s design, has meant 

20           a lot, and we truly look forward to working 

21           with ESD on that.  

22                  As well as the fact that the Nano 

23           College is coming back here to Albany, where 

24           it originated, so I want to echo some of the 


 1           comments of my colleague Al Stirpe and others 

 2           about a Thruway corridor to making sure we're 

 3           working with Micron, with SUNY Poly, with the 

 4           Nano College here, and of course Rochester 

 5           and Buffalo.  So I see it as an entire 

 6           semiconductor corridor, and welcome ESD's 

 7           involvement on that as well.

 8                  Also want to just share the concerns 

 9           from my colleagues regarding the UI surtax.

10                  But a couple of questions.  One, I 

11           represent -- I live here in Albany, represent 

12           Albany and surrounding towns.  But downtown 

13           Albany is still struggling -- not just the 

14           arts, which is struggling as well, but also 

15           the businesses.  Any update, Commissioner, on 

16           the -- when workers may be returning?  

17                  And then I'm going to get my second 

18           question in as well, which is OGS also, on 

19           the entire electrification of some of the 

20           properties.  I know you've been working here 

21           in the Capitol, which also ties into the 

22           plants at Sheridan Hollow.  We've been 

23           working with you for a number of years.  It 

24           had been one of our more environmentally 


 1           impacted areas of the city, and it's also one 

 2           of our most economically disadvantaged.  So 

 3           what we do to electrify the Capitol also 

 4           impacts Sheridan Hollow where we've had the 

 5           power plants.

 6                  So if you could just give us an update 

 7           on that and how those plans match the Climate 

 8           Action Council, Commissioner.

 9                  OGS COMMISSIONER MOY:  Assemblymember 

10           Fahy, thank you for that question.  I'm very 

11           proud of the work that OGS has done in order 

12           to reduce the energy usage here at the 

13           Empire State Plaza, as well as to look at 

14           generation of power.  

15                  I want to walk through a handful of 

16           items that were -- that have happened here at 

17           the Empire State Chill Plant, which is in the 

18           Sheridan Hollow area, as you know.  We have 

19           installed an on-site electric chiller, which 

20           replaces a steam-driven chiller.  That has -- 

21           by electrifying that one chiller, we have 

22           reduced local gas and emissions use at our 

23           steam plant by 18 percent.  That's real 

24           emissions in carbon that's coming out of the 


 1           air that is going to be incredibly impactful 

 2           for local communities.  We're very proud of 

 3           that work.

 4                  We have installed LED lighting 

 5           throughout the entire plaza, which again 

 6           reduces our energy usage --

 7                  ASSEMBLYWOMAN FAHY:  I'm about to run 

 8           out of time, thank you.  I'm going to follow 

 9           up with you, and just want to add the support 

10           for the arts funding being restored.  Thank 

11           you.

12                  Thank you, Chairs.  Sorry, 

13           Commissioner, want to be sensitive to the 

14           time.  Thank you.

15                  OGS COMMISSIONER MOY:  Absolutely.

16                  CHAIRWOMAN WEINSTEIN:  Thank you.

17                  We were joined earlier by two members 

18           I believe I neglected to announce.  

19           Assemblywoman Lucas joined us, and 

20           Assemblyman Brown joined us.

21                  Now to the Senate.

22                  CHAIRWOMAN KRUEGER:  Thank you.

23                  Senator Serrano, three-minute second 

24           round.


 1                  SENATOR SERRANO:  Thank you, 

 2           Madam Chair.

 3                  This is for Executive Director 

 4           Mara Manus. 

 5                  On the issue of capital grants, it 

 6           appears in the proposed budget that there's 

 7           elimination of the 40 million made available 

 8           last year in capital funding.  And we know 

 9           that during the pandemic the needs for 

10           capital were great, with organizations 

11           upgrading their ventilation systems, others 

12           ADA compliance and other needed projects.

13                  So I just wanted to ask, what is the 

14           status of last year's allocation for small 

15           and mid-sized capital projects?  And, you 

16           know, what does the elimination of that 

17           funding in the current year, what could that 

18           possibly mean?

19                  NYSCA EXEC. DIR. MANUS:  Thank you so 

20           much.  And we are so grateful for the 

21           allocation and appropriation for capital over 

22           the last few years.

23                  The status of last year's grants is 

24           that they've all been fully committed, that 


 1           the fund has been fully committed.  I'm happy 

 2           about 70 -- to date, about 70 projects have 

 3           been completed across the state.  And I can 

 4           give you further detail on that offline.

 5                  I would say that what we know is that 

 6           the majority of our grantees are small 

 7           organizations with budgets of less than 

 8           $3 million, and would be -- and those are the 

 9           ones that would access the small and 

10           medium-size fund -- would access that fund 

11           for the most part.

12                  As we know, the government is the 

13           number-one stop for accessing capital dollars 

14           in the arts.  The city and the state and the 

15           counties are -- the foundations do not have, 

16           for the most part, any kind of capital 

17           funding to offer.  And when you're thinking 

18           about individuals, wealthy individuals, they 

19           mostly accrue to the largest organizations -- 

20           museums -- in the city and the state.

21                  SENATOR SERRANO:  (Mic off.)  I'm 

22           having a little trouble hearing.

23                  NYSCA EXEC. DIR. MANUS:  Should I get 

24           closer?  Is that better?  Okay, great.


 1                  So just to repeat, government is the 

 2           number-one stop for capital dollars for most 

 3           arts organizations.  Foundations don't have 

 4           those dollars, and wealthy individuals, those 

 5           mostly accrue to the largest institutions, 

 6           like museums, in the city.

 7                  When you get out of city, there are 

 8           fewer funding avenues, whether it's capital 

 9           or operations, as you guys know.

10                  So eliminating -- with the small and 

11           medium-size opportunities we've been able to 

12           reach the majority of our grantees, which 

13           are, as I said, 82 percent have budgets below 

14           $3 million.  So not having that opportunity 

15           will be a -- definitely have impact on the 

16           majority of our grantee pool.

17                  I would also say that, you know, we 

18           have to understand to what extent the capital 

19           has real economic development return.  I 

20           mean,  thinking about even the Little Theater 

21           in Rochester, which received a $550,000 grant 

22           from our small and medium-size pool, they 

23           have a $1.5 million budget and they return 

24           about 3.5 to the local economy every year.


 1                  CHAIRWOMAN KRUEGER:  Thank you.

 2                  Assembly.

 3                  CHAIRWOMAN WEINSTEIN:  Assemblywoman 

 4           Jackson.

 5                  ASSEMBLYWOMAN JACKSON:  Thank you, 

 6           Chair.

 7                  Based on the testimony, we hear that 

 8           we're seeing job growth; the unemployment 

 9           rate declined in the state to 4.3 percent.  

10           What is the job growth and unemployment rate 

11           for Black people, Latino people and young 

12           people?  And -- we'll start there and I'll 

13           ask my next question after that.

14                  COMMISSIONER KNIGHT:  So thank you for 

15           your question.  

16                  I have to get back to you with 

17           specific demographic information.  But we 

18           know that it is not sufficient.  

19                  And with respect to our Office of 

20           Workforce Development, we are looking 

21           specifically to focus on disadvantaged 

22           communities, barriers that prevent folks from 

23           accessing employment.  So we're looking at 

24           programs that are providing wraparound 


 1           services, support for transportation, 

 2           childcare, and any other challenges that 

 3           prevent folks from accessing training 

 4           opportunities.

 5                  ASSEMBLYWOMAN JACKSON:  Okay.  And one 

 6           of my colleagues said something about adult 

 7           literacy, so we can add that, as well as 

 8           language barriers.  

 9                  And then for OGS, what percentage of 

10           your vendors are MWBE?

11                  OGS COMMISSIONER MOY:  We have 

12           exceeded the Governor's targets of 

13           30 percent, and we've done so for many years 

14           in a row.  I will have to get back to you on 

15           the exact percentage, but I believe it's 

16           about 43 percent.

17                  ASSEMBLYWOMAN JACKSON:  Okay.  And 

18           then in the City of New York, we've noticed 

19           that the MWBE is mostly white women and Asian 

20           men that get contracts.  And so I'm just 

21           wondering, are we seeing the same situation 

22           for the state?

23                  COMMISSIONER KNIGHT:  We see more of 

24           about half and half with respect to women and 


 1           minorities.

 2                  ASSEMBLYWOMAN JACKSON:  So we have an 

 3           issue with job vacancies, but we have so many 

 4           workforce development sites.  What is the 

 5           disconnect?

 6                  COMMISSIONER KNIGHT:  So this is what 

 7           our Office of Strategic Workforce Development 

 8           is really focused on, really working with 

 9           employers to understand what their needs are 

10           and then training folks for those specific 

11           jobs.  

12                  You know, we've seen in the past 

13           there's been a lot of training, not 

14           necessarily for a specific job opportunity, 

15           and we want to tailor the training for a job 

16           opportunity.

17                  ASSEMBLYWOMAN JACKSON:  Okay.  So my 

18           last question is geographically, are the 

19           workforce development sites in a different 

20           place where the work is needed, versus where 

21           the people are?  Like are they just not in 

22           the same areas?

23                  COMMISSIONER KNIGHT:  No, the -- it's 

24           just that it's really -- what we're seeing is 


 1           a disconnect with skills needed and jobs 

 2           available.  So we're trying to make that 

 3           match.

 4                  ASSEMBLYWOMAN JACKSON:  Okay.  And so 

 5           I'm hoping that next year we won't have this 

 6           same conversation.  Because it's not new, 

 7           right?  Like we've been dealing with this for 

 8           a long time.  And I'm just hoping that we can 

 9           make some headway in this area.

10                  Thank you all so much.

11                  COMMISSIONER KNIGHT:  Thank you.

12                  OGS COMMISSIONER MOY:  Assemblymember, 

13           if I may correct, we have -- 34 percent is 

14           our current target.  We're very proud because 

15           in 2011 we were at 14 percent.  This year 

16           we've grown and met -- passed the 30 percent 

17           mark.  

18                  Because our spend is so significant, 

19           it's a fair amount of dollars that are going 

20           in.  As an example, MWBEs have received in 

21           excess of 1.17 billion in funding and 

22           contracts from OGS.

23                  ASSEMBLYWOMAN JACKSON:  Thank you.

24                  CHAIRWOMAN WEINSTEIN:  Thank you.


 1                  To the Senate.

 2                  CHAIRWOMAN KRUEGER:  Thank you.

 3                  Three minutes to Chair Senator Cooney.

 4                  SENATOR COONEY:  Thank you, Madam 

 5           Chair.  

 6                  This question is for Empire State 

 7           Development.  Last year the Legislature was 

 8           intentional about adding funds and a tax 

 9           credit for digital gaming.  I wondered if you 

10           could give us an update on the program so 

11           far.

12                  COMMISSIONER KNIGHT:  Yes.  So last 

13           year there was a $25 million tax credit 

14           added, $5 million for five years.  

15                  We are beginning to receive 

16           applications and awarding projects, and so we 

17           look forward to continuing to execute that 

18           program.

19                  SENATOR COONEY:  And in terms of 

20           competitiveness -- we've talked about this in 

21           relationship to the film and tax credit.  But 

22           for digital gaming, are we staying 

23           competitive as a state at that $25 million 

24           mark in terms of competing with other states 


 1           as it relates to getting digital gaming jobs 

 2           and creators to come to our New York?

 3                  COMMISSIONER KNIGHT:  Well, because it 

 4           is a new program, it seems like it is 

 5           sufficient now.  

 6                  You know, the issue is that we produce 

 7           so much of the talent from our outstanding 

 8           academic institutions, but the folks don't 

 9           stay here.  And so the goal is to have that 

10           digital game development happen here in 

11           New York.

12                  SENATOR COONEY:  Great.  Well, I am 

13           continuing to be supportive, obviously.  I 

14           represent RIT, which has the Magic Spells 

15           Studios, as well as RPI and NYU, which are 

16           also leaders in this space.

17                  But I do want to keep an open mind 

18           whereas in the future, within that five-year 

19           window, that there's an opportunity to 

20           increase -- through the budget, of course -- 

21           to make sure that we stay competitive.  

22           because I think this is a huge job creation 

23           opportunity, in addition to what we're seeing 

24           with our TV and film industry.


 1                  Thank you very much.  Thank you, 

 2           Chair.

 3                  COMMISSIONER KNIGHT:  Thank you.

 4                  CHAIRWOMAN KRUEGER:  Thank you.

 5                  Assemblymember McDonald.

 6                  ASSEMBLYMAN McDONALD:  Thank you, 

 7           Madam Chair.

 8                  Commissioner Moy, actually you 

 9           probably dodged a question, because I think 

10           Member Fahy and another member got to this.  

11           But I do want to thank your department, along 

12           with NYPA.  They've been very responsive in 

13           regards to the Sheridan Hollow project in 

14           particular here in Albany.

15                  As you know, in the budget there's a 

16           discussion about all-electric buildings.  

17           That is not really in your department, but 

18           it's gotten a lot of attention.  We all know 

19           we need to move in the right direction, just 

20           the speed is what's going to be the critical 

21           part.

22                  But are there other examples -- I 

23           firmly believe the state should lead by 

24           example.  I think you've demonstrated some 


 1           examples today.  Are there any more examples 

 2           coming up that we could point to support?

 3                  OGS COMMISSIONER MOY:  Thank you, 

 4           Assemblymember McDonald.  

 5                  One of our priorities is going to be 

 6           doing an energy audit to identify and 

 7           baseline the greenhouse gas emissions so we 

 8           can focus on our top targets to reduce our 

 9           greenhouse gas emission production.

10                  So we are looking not just to stay 

11           with what we've done in Sheridan Hollow, but 

12           how to further reduce greenhouse gas 

13           emissions here in the Empire State Plaza and 

14           other properties.  Harriman is certainly one 

15           that is a significant campus for OGS and for 

16           the state.

17                  So we are looking forward to some of 

18           the work that was funded through this 

19           Executive Budget to create those baselines.  

20           And we are doing energy audits in partnership 

21           with NYPA to figure out how we can further 

22           reduce those emissions.

23                  ASSEMBLYMAN McDONALD:  Thank you.

24                  Commissioner Knight, I want to second 


 1           Senator Cooney's comments about digital 

 2           gaming.  I know sometimes people look a 

 3           little funny at tax credits.  This one is an 

 4           investment in retaining people in New York 

 5           State.  We educate them, and we do a good job 

 6           of exporting them.

 7                  So fully support it as a guy 

 8           representative of five cities; it's where 

 9           cities are really going to see their rebirth 

10           as retail has gone in different directions 

11           because of the new economy.  So I want to 

12           thank your team.  You guys are doing a great 

13           job rolling it out.

14                  Restore, I'm actually a little bit 

15           disappointed to hear that, because I know 

16           there's just -- just last month, the 31st, 

17           another round had closed.

18                  COMMISSIONER KNIGHT:  Right.

19                  ASSEMBLYMAN McDONALD:  So I think part 

20           of the challenge has been it's been a 

21           start-stop program.  Developers, communities, 

22           it takes time.  So obviously I will be 

23           pushing for restoration.  I'm surprised.

24                  You mentioned in your testimony, even 


 1           though MWBE kind of jumps all over, about the 

 2           Governor wants to remove barriers for MWBE.  

 3           And admittedly the pandemic had an impact.  

 4           But what about recertification?  That seems 

 5           to be something that is blowing my mind -- 

 6           it's taking three, four years for women-owned 

 7           and minority-owned businesses to continue to 

 8           recertify, because they get blacklisted in 

 9           the process.  People don't agree with that.

10                  Is there any effort to change that?

11                  COMMISSIONER KNIGHT:  Yes.  Thank you 

12           for your question.

13                  And we really do appreciate that there 

14           are MWBEs that are having challenges with 

15           respect to time frame for recertification.

16                  When I came into this role, we had a 

17           backlog of MWBE applications -- I can talk to 

18           you about this later, the update.

19                  ASSEMBLYMAN McDONALD:  That would be 

20           great, thank you.

21                  COMMISSIONER KNIGHT:  Thank you.

22                  CHAIRWOMAN WEINSTEIN:  Senate?

23                  CHAIRWOMAN KRUEGER:  I believe the 

24           Senate is complete, so we can roll it on to 


 1           the Assembly.

 2                  CHAIRWOMAN WEINSTEIN:  Okay, here we 

 3           go.

 4                  Assemblyman Maher.

 5                  ASSEMBLYMAN MAHER:  Thank you.  

 6                  Appreciate all your time.  I would say 

 7           good afternoon, I think at this point.  And 

 8           my questions are going to be focused on 

 9           workforce development and career paths.

10                  And one area that I wanted to ask you, 

11           if your office has had discussions that have 

12           reached your desk -- and if not, are you open 

13           to them -- in identifying industries that 

14           have a real issue with workforce.  

15           Specifically, ones such as EMS that we see a 

16           real struggle with.  

17                  Have there been any discussions within 

18           the industry, and are there any plans to 

19           incentivize this group of potential workers 

20           in the future?

21                  COMMISSIONER KNIGHT:  So thank you for 

22           your question.  We know that there have been 

23           a shortage of EMS as well as 

24           healthcare-related services.


 1                  ESD is not involved in training of 

 2           healthcare-related service careers.  I know 

 3           that DOH is involved in supporting health 

 4           service careers, and they do have money in 

 5           various programs for different pathways in 

 6           health careers.

 7                  ASSEMBLYMAN MAHER:  Okay.  The second 

 8           part of that -- and I would love to follow-up 

 9           with your office on that specific topic to 

10           see how ESD can be engaged in that process as 

11           well.  There are so many industries that need 

12           employment, and there are so many folks that 

13           need training and jobs that will become 

14           available.

15                  When we talk about the issue of youth 

16           flight, has your office talked about programs 

17           -- not just in colleges, because there's a 

18           tremendous amount of funding that I see 

19           towards colleges and university programs -- 

20           but in the high schools, in the middle 

21           schools, to develop programs that are 

22           successful and build on them and help create 

23           programs at that level to really get to kids 

24           when they're most at that point to become 


 1           inspired and decide, hey, they want to be in 

 2           New York.  

 3                  Because as much as we want to tackle 

 4           affordability, in 10 years, if we're still 

 5           having the same issue with affordability, we 

 6           need to inspire our youth to be invested at a 

 7           very young age, to see themselves living here 

 8           and growing their families here.

 9                  COMMISSIONER KNIGHT:  Thanks for that 

10           question.

11                  We do -- I do see money in the budget 

12           for programs for high school, things like 

13           P-TECH programs, which create exposure to 

14           career opportunities; continuing ed programs 

15           in community colleges that are not 

16           necessarily for folks that are college-bound 

17           but can get a certificate, and then that 

18           could lead to employment opportunities.

19                  So we do look at a number of programs 

20           that are not, you know, AA- or 

21           BA-credentialed programs to support job --

22                  ASSEMBLYMAN MAHER:  Would you be 

23           willing to further support those programs and 

24           really prioritize that effort at a younger 


 1           age, so that we can see this return 10, 

 2           15 years from now?

 3                  COMMISSIONER KNIGHT:  We will 

 4           definitely look at that in our Office of 

 5           Workforce Development.

 6                  ASSEMBLYMAN MAHER:  Thank you.  

 7           appreciate it.

 8                  CHAIRWOMAN WEINSTEIN:  We go to 

 9           Assemblyman Cunningham.

10                  ASSEMBLYMAN CUNNINGHAM:  Good morning.  

11           thank you so much.  Good afternoon, actually.  

12           thank you so much for your work.

13                  Question for NYSCA on the percentage 

14           of funding for BIPOC organizations of color 

15           distributed last year.  Do you have that 

16           number for us by any chance?

17                  NYSCA EXEC. DIR. MANUS:  You know, 

18           your question's a little -- the sound is a 

19           little distorted.

20                  ASSEMBLYMAN CUNNINGHAM:  Oh.  Let me 

21           ask again.  The percentage of funding for 

22           BIPOC organizations that were distributed 

23           last year.

24                  NYSCA EXEC. DIR. MANUS:  What percent 


 1           of our funding, is that what you said?

 2                  We don't have those numbers.  We 

 3           don't -- but I can tell you that we do 

 4           prioritize underrepresented communities.  And 

 5           that was one of the priorities in our 

 6           overhaul of our process a couple of years 

 7           ago.

 8                  I'm happy to share with you the 

 9           language from our application about how we 

10           prioritize those communities.  But we don't 

11           capture those numbers.

12                  ASSEMBLYMAN CUNNINGHAM:  Thank you.

13                  OGS.  I'm noticing in the parking lot 

14           a lot of EV vehicles among state employees 

15           and also members of the Assembly and the 

16           Senate.  Wondering what the timeline is for 

17           putting more charging stations in our New 

18           York State buildings.

19                  OGS COMMISSIONER MOY:  I appreciate 

20           the question, Assemblymember.  

21                  We have identified a number of 

22           locations where we'll be installing 

23           additional charging stations.  We have been 

24           working with NYPA to expedite that process, 


 1           and we hope to make sure that the 

 2           infrastructure is available to support the 

 3           electric load within the next year or so.

 4                  But that study has begun.  We'll be 

 5           sharing information about those sites, and we 

 6           are looking at places not just for our 

 7           employees but also for the Legislature, to 

 8           make sure that you have capacity.  

 9                  I will note that we do actively 

10           monitor usage, and at this point in time the 

11           capacity is available.  What we are going to 

12           be focused on is also making sure the 

13           appropriate signage -- if a place is not 

14           available for charging, that you can easily 

15           find another one, is something that we are 

16           looking actively to improve.

17                  ASSEMBLYMAN CUNNINGHAM:  Thank you so 

18           much.

19                  And Commissioner Hope, my last 

20           question is for you.  I'm thinking about the 

21           ConnectALL program and all the resources.  I 

22           think there was $1 billion last year 

23           allocated, particularly in upstate New York, 

24           to help create rural districts' connectivity.


 1                  But I represent parts of Brooklyn, 

 2           Central Brooklyn, where folks still don't 

 3           have broadband access.  And I'm thinking 

 4           about adoption and affordability and what the 

 5           action plan is there for both of those items.

 6                  COMMISSIONER KNIGHT:  So with respect 

 7           to affordability, we've been proud to get 

 8           1 million households in the federal 

 9           Affordability Broadband Program, which 

10           provides a $30 a month subsidy.  And so we 

11           continue to market that as a program, as well 

12           as we will have more competition in markets 

13           to try to drive prices down of broadband 

14           service.

15                  ASSEMBLYMAN CUNNINGHAM:  Thank you 

16           all.

17                  CHAIRWOMAN WEINSTEIN:  We go to 

18           Assemblyman Zebrowski.

19                  ASSEMBLYMAN ZEBROWSKI:  Thank you.

20                  Good afternoon.  I chair the Committee 

21           on Corporations, Authorities and Commissions, 

22           so we are definitely interested in the 

23           broadband rollout.  I heard you mention -- 

24           answer some of my colleagues earlier, that 


 1           300 million, the 1 billion.  Did you give a 

 2           timeline?  I know you said it's coming up.  

 3           But is there not a timeline where we can 

 4           expect sort of a plan for this?

 5                  COMMISSIONER KNIGHT:  We'll be able to 

 6           put together a more comprehensive plan once 

 7           we know when we're going to get the federal 

 8           money.  Which we --

 9                  ASSEMBLYMAN ZEBROWSKI:  When we'll get 

10           the federal money?

11                  COMMISSIONER KNIGHT:  Yes.  We expect 

12           to get it the end of this year.

13                  ASSEMBLYMAN ZEBROWSKI:  I know a 

14           majority of the money is extremely necessary, 

15           it's going to go out to build broadband in 

16           rural areas.  I think the office has stated 

17           that some of the money will also be spent 

18           downstate.  I haven't heard any additional 

19           details.

20                  Is that true, and we'll hear those 

21           details when you get the federal money and 

22           you roll this out?

23                  COMMISSIONER KNIGHT:  You know, some 

24           of the money will be spent downstate to 


 1           create more competition to drive prices down 

 2           for consumers.

 3                  ASSEMBLYMAN ZEBROWSKI:  Okay.  While 

 4           you can't give an exact timeline, are we 

 5           talking this year we'll get -- do you have a 

 6           timeline on the timeline?

 7                  COMMISSIONER KNIGHT:  So we think that 

 8           we will provide a timeline probably towards 

 9           the end of the year when we are getting the 

10           money from the federal government.

11                  ASSEMBLYMAN ZEBROWSKI:  Okay.  I know 

12           New York City recently lost -- launched a 

13           program to provide free broadband to NYCHA 

14           residents.  I think that was a program 

15           through the New York City budget, in 

16           partnership with private companies.

17                  Do you expect the ConnectALL program 

18           to replicate anything like that outside of 

19           New York City to low-income and senior 

20           housing around the state?

21                  COMMISSIONER KNIGHT:  So with respect 

22           to digital equity, that will definitely be a 

23           part of the digital equity plan in trying to 

24           provide broadband to underrepresented 


 1           communities, seniors, low-income communities.

 2                  ASSEMBLYMAN ZEBROWSKI:  Okay.  So that 

 3           would be part of the plan --

 4                  COMMISSIONER KNIGHT:  We'll look at 

 5           the -- yes.

 6                  ASSEMBLYMAN ZEBROWSKI:  -- when we get 

 7           it.  Okay.

 8                  Briefly, Commissioner Moy, on the 

 9           school buses, if you could.  You gave a 

10           little bit of information to my colleague 

11           earlier.  I'm hearing a lot from my school 

12           districts on this issue.  They're estimating, 

13           you know, current school buses cost about 

14           150,000.  The electric buses cost about 

15           450,000.  

16                  They talk about the mileage capacity 

17           and are extremely worried about an inability 

18           to handle their routes, especially in extreme 

19           weather -- or not even that extreme weather.  

20           They talk about the issues with the 

21           utilities, their willingness and ability to 

22           install the infrastructure necessary.

23                  Do you have any comments as you're 

24           looking at this regarding those price 


 1           estimates, those mileage and the 

 2           infrastructure?

 3                  OGS COMMISSIONER MOY:  I can get back 

 4           to you with specifics around the accuracy of 

 5           that data.

 6                  I have a child myself, and my children 

 7           ride school buses, and we're up here in the 

 8           Capital Region.  So I know -- when I hear 

 9           some of the feedback that comes about, you 

10           know, anxiety around those EV buses, whether 

11           or not they'll be able to pass their routes, 

12           it is items that we've shared and discussed 

13           during that procurement.

14                  We feel confident in the procurement 

15           that took place, and we are going to be 

16           monitoring it very closely to make sure that 

17           the school districts are getting what they 

18           need.

19                  Our role in this is to make sure that 

20           we have the best possible vendors and that 

21           we're doing the training and providing the 

22           infrastructure or the access to build that 

23           infrastructure.  So I appreciate the 

24           feedback; it is something we are watching.


 1                  ASSEMBLYMAN ZEBROWSKI:  Any data would 

 2           be great.  Thanks.

 3                  OGS COMMISSIONER MOY:  Absolutely.

 4                  CHAIRWOMAN WEINSTEIN:  Thank you.

 5                  Assemblyman Zaccaro.

 6                  ASSEMBLYMAN ZACCARO:  Thank you so 

 7           much, Chairs.

 8                  Just really quickly, Commissioner, you 

 9           outline in your testimony that the Governor's 

10           budget will provide matching grant funding to 

11           attract federal research dollars to New York.  

12           And so I just had a question.  How many small 

13           businesses in New York currently participate 

14           in the federal Small Business Innovation 

15           Research or the Small Business Technology 

16           Transfer programs?  And of those programs, 

17           how many of those are minority- and 

18           women-owned businesses?

19                  COMMISSIONER KNIGHT:  So, 

20           Assemblymember, I will have to get back to 

21           you on the specific data related to the 

22           program.  But we know that that program is 

23           very important to small businesses involved 

24           in innovation.


 1                  ASSEMBLYMAN ZACCARO:  Okay.  Are there 

 2           regions of New York where there's a higher 

 3           concentration of participants in those 

 4           programs?

 5                  COMMISSIONER KNIGHT:  I have to get 

 6           back to you on the mix of where those 

 7           businesses are located.

 8                  ASSEMBLYMAN ZACCARO:  Okay.  And 

 9           lastly, would there be any limit on the 

10           number of New York-based small businesses 

11           that could participate in this matching grant 

12           program?  And if so, how many would -- how 

13           would New York small businesses be notified 

14           of the matching grant program?

15                  COMMISSIONER KNIGHT:  So the 

16           businesses -- are you talking about the Small 

17           Business Innovation Research program?

18                  ASSEMBLYMAN ZACCARO:  Both programs.

19                  COMMISSIONER KNIGHT:  Both programs.  

20           And the transfer of technology program, okay.

21                  So they apply to the federal 

22           government for grants, and we provide a 

23           letter that we would provide matching grants 

24           to that funding.  And that funding is 


 1           available from $10,000 to $50,000.  So 

 2           depending on -- the level of award would 

 3           dictate how many grants we'd be able to fund.

 4                  ASSEMBLYMAN ZACCARO:  Okay.  And 

 5           how -- just on my last question, how would 

 6           New York small businesses be notified of this 

 7           program?

 8                  COMMISSIONER KNIGHT:  We'll use our 

 9           existing outreach efforts through our REDCs, 

10           regional offices.  We will work with the 

11           Legislature to provide information and 

12           collateral to businesses that the program is 

13           available.

14                  ASSEMBLYMAN ZACCARO:  Okay.  Well, I 

15           look forward to the follow-up on the first 

16           two questions that I had.  

17                  Thank you, Chairs, so much for the 

18           opportunity.

19                  CHAIRWOMAN WEINSTEIN:  Thank you.

20                  Assemblywoman Lucas.

21                  ASSEMBLYWOMAN LUCAS:  Good afternoon 

22           to everyone.  Thank you, Chair, for 

23           recognizing me.

24                  There's so many concerns that you can 


 1           barely wrap it in three minutes.  But I'll 

 2           get to the point.

 3                  I noticed a lot of really amazing 

 4           things in your testimony around workforce as 

 5           well as MWBE.  But I come from a district 

 6           that kind of makes up both rural and urban.  

 7           I'm sure that my colleagues up here as well, 

 8           they share some similar factors of the 

 9           district.  But I see that there's a lot of 

10           employment opportunities, job creation, 

11           opportunities for MWBE.  

12                  But I can't help but to understand -- 

13           or to wonder why is it, with all of these 

14           opportunities, we are high in unemployment in 

15           our district of East New York?  Why is it 

16           that our Local Development Corporation, some 

17           of the services that they had been receiving 

18           from ESD have been cut, which affects their 

19           ability to support small businesses and those 

20           who want to create business opportunities.  

21                  And how, at the same time, we're 

22           saying that we want to support MWBEs but the 

23           very organizations and systems that are in 

24           place to do that, there's a lot of funding 


 1           that's additionally being cut every time we 

 2           have these conversations.

 3                  I just need to know, for full 

 4           transparency, so that we can get a real 

 5           assessment of what's happening, because I 

 6           know there's some questions that you were 

 7           unable to answer today.  Can we get a 

 8           breakdown of how many Black people are 

 9           benefiting from these opportunities?  

10                  The reason why it's important for me 

11           to emphasize that is because in New York City 

12           alone, we've lost over 200,000 Black families 

13           that have exited New York City.  Our 

14           enrollment in the school system is down to 

15           roughly about 23 percent.  The reason why 

16           that's happening is because we can't afford 

17           to live in New York City.  

18                  If we can't afford to live in New York 

19           City, there's something wrong with the job 

20           opportunities.  And the job opportunities 

21           that then come are always those low-hanging 

22           fruit, those low-paying jobs.  I'm seeing 

23           that there's opportunities for folks to make 

24           over $100,000, but that's not in our 


 1           district.  

 2                  So I'd just like an opportunity for a 

 3           breakdown of what that looks like and how 

 4           we're going to get to a point where we can 

 5           work collectively to address that issue 

 6           effectively.

 7                  COMMISSIONER KNIGHT:  I look forward 

 8           to working with you.

 9                  CHAIRWOMAN WEINSTEIN:  Thank you.  

10           This question, along with other questions, if 

11           you can respond to Senator Krueger and 

12           myself, and we'll make sure that answers will 

13           be distributed to all of the members.  There 

14           also may be a need for some offline 

15           conversations.

16                  Thank you.  We're going to go now to 

17           Assemblyman Manktelow, for three minutes.

18                  ASSEMBLYMAN MANKTELOW:  Thank you, 

19           Madam Chair.

20                  Commissioner Moy, just a couple of 

21           questions of you, back on prisons.  In my 

22           district we have a prison that's been closed 

23           for about 10, maybe 15 years now.  Last 

24           summer we did walk through that with some of 


 1           the members of the commission to take a look 

 2           at it.  Since then, our local economic 

 3           development, as you see, has identified 

 4           several businesses that are willing to buy it 

 5           today, and at a fair market price.  But we 

 6           can't seem to move from there.  We keep being 

 7           stalled from -- in one way or another.

 8                  What can you do to expedite this?  

 9           It's a win-win.  It's a win-win for the state 

10           because those dollars are back in your 

11           pocket -- back in our pocket as taxpayers.  

12           But secondly, it takes the cost of what it's 

13           costing the state to take care of that 

14           property.  And the buildings are full of 

15           mold, and they're willing to deal with all of 

16           that.  So what can we do to expedite this so 

17           we can make this happen?

18                  COMMISSIONER KNIGHT:  Thank you for 

19           your question, Assemblymember.  I've been 

20           keeping my eye on this project very directly.  

21           We're working to --

22                  ASSEMBLYMAN MANKTELOW:  Do you know 

23           where I'm talking about?

24                  COMMISSIONER KNIGHT:  Absolutely.


 1                  And we are working to expedite the 

 2           transaction of this prison as soon as 

 3           possible.  So we'll be in touch, but trying 

 4           to make sure that this happens as soon as it 

 5           possibly can.

 6                  ASSEMBLYMAN MANKTELOW:  Well, that's 

 7           the best news I've heard all day.  So thank 

 8           you very much, and thank you for being here.

 9                  I do have another minute and 

10           40 seconds.  So, Commissioner Moy, back to 

11           you.  

12                  There are other OGS properties 

13           throughout the state, and in my district as 

14           well there's properties that the state owns 

15           that have been vacant for four to five 

16           decades.  And the same situation there.  We 

17           have buyers that want to buy part or all of 

18           those properties, which would be beneficial 

19           to the state so we don't have to deal with 

20           them anymore, it puts them back on the tax 

21           rolls.  But when we change governors, we 

22           change leadership, and they can get kicked 

23           back to the beginning again. 

24                  What can we do to help expedite those 


 1           situations so those businesses can grow as 

 2           well?

 3                  OGS COMMISSIONER MOY:  That is a 

 4           process in which we work in partnership with 

 5           the chamber, and we work in partnership with 

 6           ESD.  Our role is to make sure that these 

 7           deals, as they are facilitated, we can either 

 8           help them come out for proper sale through an 

 9           RFP process, we can handle it through special 

10           legislation.  

11                  But what is the best way of making 

12           sure, as I've been in this job for about 

13           14 months, is if something has fallen off our 

14           radars, please reach out; we'll look out to 

15           those items in particular and we'll 

16           coordinate with our partners in state 

17           government to get you good answers.

18                  ASSEMBLYMAN MANKTELOW:  That would be 

19           great.  Because the one buyer has worked 

20           through this process three times.  And it 

21           stops, he's ready to buy it, and then it gets 

22           kicked back.

23                  OGS COMMISSIONER MOY:  I'm not 

24           familiar with the deal.  I don't have an as 


 1           encyclopedic memory as Commissioner Knight.  

 2           But we are absolutely happy to look into 

 3           those areas and expedite if there are 

 4           opportunities to bring it back to the tax 

 5           rolls.

 6                  ASSEMBLYMAN MANKTELOW:  Perfect, thank 

 7           you.  Thank you all for being here this 

 8           morning -- this afternoon, I apologize.  

 9           Thank you for your time.

10                  CHAIRWOMAN WEINSTEIN:  We go to 

11           Assemblyman Ra, ranker, for five minutes.

12                  ASSEMBLYMAN RA:  Thank you.

13                  I have a question for Commissioner 

14           Knight, but I do want to thank Commissioner 

15           Moy for reaching out last week to try to 

16           connect before the hearing.  I don't have any 

17           questions for you at this time, but thank you 

18           for your answers today.

19                  Commissioner Knight, we had last year 

20           at this hearing talked a little bit about -- 

21           I know you mentioned it in your testimony, 

22           about doing kind of third-party evaluations 

23           of some of the economic development programs.  

24           Can you update me on any of those that have 


 1           taken place in the last year?

 2                  COMMISSIONER KNIGHT:  Absolutely.

 3                  So those programs were -- our tax 

 4           credit programs are being reviewed by the 

 5           Department of Tax and Finance, who has hired 

 6           a third party to do those studies.  We've 

 7           been providing data and information to Tax 

 8           and Finance to their outside consultant so 

 9           that they can work through these studies.  

10           And we expect to get these studies done by 

11           the beginning of next year, 2024.

12                  ASSEMBLYMAN RA:  Okay.  And so 

13           relative to START-UP in particular, do we 

14           have any type of preliminary information or 

15           anything of that sort?  I'm asking because 

16           obviously we have a proposal to kind of 

17           rebrand and change that program in this 

18           budget, and I'm wondering if we're putting 

19           the cart before the horse a little bit.

20                  COMMISSIONER KNIGHT:  So we don't have 

21           a third party study on START-UP, what we'd 

22           like to call EPIC.  But we know that there's 

23           been $68 million of state resources since the 

24           program's inception dedicated, and we've seen 


 1           over 3,000 jobs and $1.3 billion in economic 

 2           activity.  So we do have that data that we 

 3           collect.

 4                  ASSEMBLYMAN RA:  And one thing in 

 5           particular, maybe a little more parochial 

 6           from -- for myself.  It seems like there has 

 7           been more of a drop-off in businesses leaving 

 8           the program on Long Island than the rest of 

 9           the state.  And I don't know if you have any 

10           thoughts on why that is or if something like 

11           that might be something that could be 

12           included in the review as to why that's the 

13           case.

14                  COMMISSIONER KNIGHT:  I'm not familiar 

15           with a decrease in businesses in the 

16           Long Island programs, but we'll take a look 

17           and see why that might be the case.

18                  ASSEMBLYMAN RA:  Okay, great.  I 

19           appreciate your answers with it.  I think 

20           this is -- I know there's many who view this 

21           program skeptically.  We've obviously spent a 

22           lot of money over the years of the prior 

23           administration on -- you know, on selling it, 

24           on the commercials and all that other stuff.  


 1                  So I hope that, you know, as we have 

 2           this conversation on a rebrand, a path 

 3           forward, we get as much information as 

 4           possible and figure out if it's -- if we can 

 5           make it a successful program, great.  You 

 6           know, if there are ways to improve, great.  

 7           But otherwise, you know, I think it may be 

 8           time to move on from it.

 9                  So thank you.

10                  CHAIRWOMAN WEINSTEIN:  We go to 

11           Assemblyman Stirpe for his second round of 

12           three minutes.

13                  ASSEMBLYMAN STIRPE:  Thank you.  

14                  Commissioner Knight, just some quick 

15           question and answer.  

16                  The Office of Semiconductor Expansion, 

17           Management and Integration, is there funding 

18           in the executive proposal for this?

19                  COMMISSIONER KNIGHT:  There is not 

20           funding in the executive proposal, but we 

21           expect to access funding from various sources 

22           like the Community Benefits Fund that would 

23           be provided by Micron.

24                  ASSEMBLYMAN STIRPE:  Okay.  So we 


 1           don't know what the budget is yet for the 

 2           office, or how many people might work there?

 3                  COMMISSIONER KNIGHT:  We have 

 4           allocated $40 million --

 5                  ASSEMBLYMAN STIRPE:  Forty, okay.

 6                  COMMISSIONER KNIGHT:  Yes.

 7                  ASSEMBLYMAN STIRPE:  Okay.

 8                  COMMISSIONER KNIGHT:  To support the 

 9           implementation of Micron, other semiconductor 

10           businesses, as well as supply chain.

11                  ASSEMBLYMAN STIRPE:  Okay.  All right, 

12           thank you.  

13                  On, you know, some of the older 

14           programs, the Small Business COVID Recovery 

15           Grant Program, you know, the $825 million and 

16           then 200 million last year, I know we changed 

17           some of the criteria and a bunch of 

18           businesses went back into the queue and they 

19           were all excited, and then I guess we ran out 

20           of money.

21                  Is there any idea how many businesses 

22           were left in that queue that didn't get 

23           funded?

24                  COMMISSIONER KNIGHT:  We can go back 


 1           and look at the number of businesses that 

 2           didn't get funded.  

 3                  We know that once we did relax 

 4           criteria, back in August and September, that 

 5           we were definitely oversubscribed with many 

 6           more businesses than funding available.

 7                  ASSEMBLYMAN STIRPE:  Yeah.  Yes, I had 

 8           a lot of them call and email me, so I got a 

 9           pretty good idea there were quite a few.

10                  Last thing is on offshore wind ports.  

11           We had $500 million for the development of 

12           ports for offshore wind production.  You 

13           issued a $48 million -- or there was a 

14           federal grant awarded to Arthur Kill 

15           Terminal.  And just wondering, you know, 

16           what's the status of the $500 million 

17           appropriated last year?  And is there still 

18           an opportunity for the Port of Albany to win 

19           some funding?

20                  COMMISSIONER KNIGHT:  So we continue 

21           to work with NYSERDA on the Offshore Wind 

22           Program.  I know that the Port of Albany 

23           is -- the project is moving forward.  And I 

24           believe there's an RFP that is on the street 


 1           that will be evaluated very shortly for that 

 2           project.

 3                  ASSEMBLYMAN STIRPE:  Okay, thank you.

 4                  CHAIRWOMAN WEINSTEIN:  We go to 

 5           Assemblyman Bronson for his second three 

 6           minutes.

 7                  ASSEMBLYMAN BRONSON:  Thank you, 

 8           Madam Chair.

 9                  Commissioner Knight, you've indicated 

10           that we're commissioning a study in 

11           connection with our tax incentives and their 

12           effectiveness.  Ten years ago, roughly 

13           10 years ago, 2013, we had a report of the 

14           Governor's Tax Reform and Fairness 

15           Commission.  The conclusion indicated that 

16           certain of our business incentives violate 

17           principles of good tax policy and tenets of 

18           good budgeting, and also indicated that much 

19           of the research showed that there was little 

20           or no positive impact on the net economic 

21           gains.

22                  Is this going to be a similar study?  

23           Do you expect a different conclusion?  And 

24           that was a report that came out in 2013, and 


 1           we have no significant change in our approach 

 2           to economic development since that report.

 3                  COMMISSIONER KNIGHT:  Well, thank you 

 4           for your question, Assemblymember.

 5                  When we look at the impact of our 

 6           programs we see, you know, significant 

 7           economic benefits being delivered.  And so we 

 8           expect to see and have that validated by the 

 9           reports that get done that will be delivered 

10           at the beginning of next year.

11                  ASSEMBLYMAN BRONSON:  And -- but if 

12           the report concludes similar to the 2013 

13           report, are you open to changing our 

14           strategies and re-looking at our approaches?

15                  COMMISSIONER KNIGHT:  We look forward 

16           to looking at the information to understand 

17           what the reports convey.

18                  ASSEMBLYMAN BRONSON:  Okay.  This is a 

19           macro-level question.  Through all of our 

20           programs, whether grants, tax credits, bonds, 

21           et cetera, they ultimately have a tremendous 

22           impact on our communities -- some of them 

23           positive, but some of them also negative:  

24           Increases in housing prices.  Demands on 


 1           transportation that our public transit 

 2           companies make adjustments that may impact 

 3           our families in favor of where businesses are 

 4           located.  Demands on utility usage.  Those 

 5           kind of things.

 6                  Yet I hear often from small 

 7           businesses, from neighborhood associations --  

 8           especially those in marginalized 

 9           communities -- and others, that they have no 

10           voice in this.  One could argue their voice 

11           is through local government, but they don't 

12           feel like they have a voice, especially 

13           marginalized communities.

14                  What strategies do you think we can 

15           put in place to get those voices heard as 

16           we're making decisions that will have an 

17           impact on their lives?

18                  COMMISSIONER KNIGHT:  So thank you for 

19           that question.

20                  I think that ESD, you know, has 

21           implemented strategies related to getting 

22           community feedback, particularly with big 

23           projects.  That process is happening in 

24           Central New York with respect to Micron.  


 1           We'll have a community task force that will 

 2           provide advice and prioritize -- I can come 

 3           back to you with -- 

 4                  ASSEMBLYMAN BRONSON:  Sure thing.  

 5           Thank you so much, Commissioner.

 6                  COMMISSIONER KNIGHT:  Thank you.

 7                  CHAIRWOMAN WEINSTEIN:  Thank you.

 8                  So I neglected to mention that 

 9           Assemblymember Fall joined us a while ago.

10                  I just have a quick question myself, 

11           on behalf of one of our colleagues.  So I was 

12           wondering, Hope, if you could give us a 

13           report on the outcome of the newly created 

14           Office of Financial Inclusion and 

15           Empowerment.

16                  COMMISSIONER KNIGHT:  I would have to 

17           get back to you on that.

18                  CHAIRWOMAN WEINSTEIN:  Okay.

19                  COMMISSIONER KNIGHT:  Yes.

20                  CHAIRWOMAN WEINSTEIN:  Okay.  So that 

21           we would appreciate and that would be, you 

22           know, again something that would be 

23           distributed to all of the members.

24                  And Senator Krueger, I believe the 


 1           Assembly is now done.

 2                  CHAIRWOMAN KRUEGER:  Well, then I 

 3           would like to thank all of you on the panel 

 4           for spending, you know, half of your day with 

 5           us.  And thank you to OGS because several 

 6           members have reported that the elevator they 

 7           ride is working again, and they are very 

 8           happy --

 9                  (Laughter; overtalk.)

10                  CHAIRWOMAN KRUEGER:  So we should 

11           apparently keep you here more often and get 

12           more things done.  So, really, thank you.  

13                  As they leave, some of you are going 

14           to want to grab them -- which you have the 

15           right to do, but take it out in the hallway, 

16           because we want to continue with the next 

17           panel.  Or you could grab them in the 

18           elevator, whatever.  Just not in this room.

19                  So everyone who wants to talk or 

20           stretch, go outside, please.  

21                  And I'm going to call the next panel, 

22           which is Ryan Silva, New York State Economic 

23           Development Council, and Ross Frommer, 

24           NYFIRST, Fund for Innovation in Research & 


 1           Science Talent.  Okay.

 2                  (Off the record.)

 3                  CHAIRWOMAN KRUEGER:  All right, 

 4           everyone.  Take your seats if you're staying, 

 5           and head outside if you're leaving.  Thank 

 6           you.

 7                  Thank you, gentlemen.  Why don't we 

 8           take it in the order I called you in:  First, 

 9           New York State Economic Development Council.

10                  MR. SILVA:  All set?

11                  CHAIRWOMAN WEINSTEIN:  Yup.

12                  CHAIRWOMAN KRUEGER:  Yes.

13                  MR. SILVA:  Thank you very much, 

14           Senator Krueger, Assemblywoman Weinstein, as 

15           well as the entire delegation, for the 

16           opportunity to join you today and to address 

17           you.

18                  First and foremost, I think what I 

19           would like to do is say thank you to all of 

20           you for your leadership and commitment to 

21           economic development in the 2022 budget.

22                  I should probably introduce myself 

23           first as well before I dive into my comments.  

24           Ryan Silva, New York State Economic 


 1           Development Council executive director.

 2                  I would like to highlight a few items 

 3           that were not included in the Executive 

 4           Budget that we would like to see prioritized 

 5           in this year's final budget resolution.  And 

 6           it was actually kind of reassuring to hear 

 7           several of those programs referenced by many 

 8           of you already.

 9                  Reauthorization of the Shovel-Ready 

10           FAST NY program.  I do want to thank -- 

11                  CHAIRWOMAN KRUEGER:  I'm so sorry.  

12           The clock should only be three minutes for 

13           everybody testifying.  They are not -- we're 

14           post-government.  Thank you.  So just set it 

15           at three.

16                  MR. SILVA:  I promise I will be quick, 

17           Senator.  You will not have to throw the 

18           mallet at me.

19                  Shovel Ready/FAST NY, there was 

20           $200 million committed last year.  I want to 

21           thank Assemblyman Bronson and Senator Cooney, 

22           amongst several others, for prioritizing 

23           this.  We agree that 500 million is a great 

24           number.  We would be very happy with another 


 1           $200 million in this year's budget.

 2                  Assemblyman Jones, thank you as well 

 3           for sponsoring that.  

 4                  Restore NY.  Our understanding is that 

 5           there were over $400 million in applications 

 6           for the program over the past 12 months.  As 

 7           many of you know, $250 million was allocated 

 8           to that program, which is a record number.  

 9           We would encourage a reauthorization or 

10           reappropriation of funding for Restore.  It 

11           is an extremely popular economic development 

12           program as well as a very impactful economic 

13           development program.

14                  I think we've all heard about 

15           workforce development and its importance 

16           training the next generation of workforce and 

17           providing them the skills necessary for the 

18           jobs of tomorrow.  It's something we would 

19           encourage the Legislature as well as the 

20           Governor's office to continue investing in.  

21           The $350 million for this strategic workforce 

22           department at ESD is a good start.  We would 

23           like to see that continue for years to come.

24                  The Centers for Advanced Technologies 


 1           and Centers of Excellence, those really do 

 2           need to have funding not only reauthorized 

 3           but increased.  They've been at the same 

 4           level for over a decade, and their economic 

 5           impact, as referenced earlier, is just 

 6           incredible.  It is New York State's 

 7           innovation ecosystem for entrepreneurship and 

 8           the next generation of career opportunities.

 9                  The SBIR matching grant program, which 

10           was in the Executive Budget, is something we 

11           are very supportive of.  I know, 

12           Senator Ryan, you have a bill as well that I 

13           believe passed the Senate, S1824.  We agree 

14           and support that as well and hope that we 

15           continue to match federal investment dollars.  

16           We take advantage of the opportunity that the 

17           federal government is providing by sending 

18           federal dollars towards New York.

19                  The digital gaming tax credit.  I do 

20           want to recognize and thank the Legislature 

21           for introducing and finally getting this 

22           done, specifically Assemblyman McDonald and 

23           Senator Breslin.  The $2.5 million per year 

24           over the next 10 years is a good start.


 1                  But in reality, with the large 

 2           ecosystem as it exists, we know that number 

 3           needs to increase and we hope that the 

 4           Legislature will consider increasing the cap 

 5           on that over the coming years and certainly 

 6           in this budget.

 7                  And then finally, I will close with 

 8           the Green CHIPS.  Thank you to Senator 

 9           Cooney, Assemblyman Bronson, Assemblyman 

10           Stirpe.  This has put us back on the map in 

11           the semiconductor industry.  We are the state 

12           that many of those in the industry are 

13           looking at as the opportunity to expand their 

14           manufacturing operations in New York.

15                  CHAIRWOMAN KRUEGER:  Thank you.

16                  Good afternoon.

17                  MR. FROMMER:  Chairs, ranking members, 

18           distinguished members of the Assembly and the 

19           Senate, thank you for asking me to testify 

20           here today.

21                  My name is Ross Frommer, vice 

22           president for government and community 

23           affairs at Columbia University Irving Medical 

24           Center, and I'm here to speak on behalf of 


 1           the NYFIRST program.  

 2                  And I want to thank members of the 

 3           Legislature because the NYFIRST program is 

 4           actually part of the Life Science Initiative  

 5           which you passed in I believe 2017, and 

 6           frankly the NYFIRST that originated here in 

 7           the Legislature is not part of the original 

 8           program, and you sought fit to add it.

 9                  Senator Ryan, you talked about the 

10           importance of attracting and retaining 

11           scientific talent in New York, and that is 

12           what NYFIRST does.  It helps medical 

13           schools -- and by the way, I should add I'm 

14           also here on behalf of -- we are a member of 

15           the Associated Medical Schools of New York, 

16           the trade association for New York's 

17           17 medical schools.  I'm here on their behalf 

18           as well.

19                  Although early on NYFIRST was 

20           extremely successful at attracting 

21           high-quality, top research talent to New York 

22           State, with just a small number of grants 

23           they have already created 183 new, 

24           good-paying jobs, higher-than-average 


 1           salaries, benefits that are a very good 

 2           package, and created almost a four-to-one 

 3           return on investment.  

 4                  I should note that under the program 

 5           the medical schools are required to 

 6           contribute a two-to-one match.  We're running 

 7           now almost twice that at this point.  So so 

 8           far you see tremendous success, a total 

 9           economic return of like over 4 percent -- 

10           excuse me, almost four times return on 

11           investment.

12                  Other states are doing this -- 

13           California, Texas -- and they are doing it to 

14           the tune of billions of dollars.  NYFIRST 

15           helps us compete.  We should keep doing that. 

16           It is a new program, but I should note that 

17           it's modeled after the old faculty 

18           development program, which also had a 

19           tremendous return on investment.  The state 

20           invested about $39 million over 10 years two 

21           decades ago, and the return on that was 

22           eight-to-one.  By 2015, at which point the 

23           state stopped counting, the numbers are 

24           undoubtedly higher.


 1                  At Columbia we have been able to 

 2           recruit two top-notch scientists.  One we got 

 3           from Texas -- that was fun, we actually stole 

 4           one back from Texas.  In just under three 

 5           years, I think it is, they've already created 

 6           47 new jobs and attracted I think over 

 7           $20 million of NIH funding.

 8                  This is the time to do this.  The NIH 

 9           budget has gone up now for, I think, eight 

10           years in a row, and I can't predict the 

11           future.  There's one thing that most people 

12           in Washington do agree upon -- the importance 

13           of biomedical research funding.  If this is 

14           an arms race, we need to equip ourselves.  

15                  If we are not there at the table, you 

16           can bet that Texas and California and all 

17           those other states will be, and they're going 

18           to take our scientists and prevent us from 

19           recruiting and the jobs that go with them.

20                  So thank you very much.  Happy to 

21           answer any questions.

22                  CHAIRWOMAN KRUEGER:  Thank you very 

23           much.  

24                  Our first questioner is Senator Sean 


 1           Ryan.

 2                  Everyone, by the way, it's three 

 3           minutes for everybody, one round for the rest 

 4           of the hearing.

 5                  Thank you.  Sean.

 6                  SENATOR RYAN:  Good afternoon.  

 7                  I wanted to talk a little bit with 

 8           Mr. Silva about IDAs.  So we just had the 

 9           Empire State Development chair come in, and 

10           they outlined about $1.8 billion of the 

11           spending every year, and it's all done 

12           through a centralized state program.  

13                  And then you look at IDAs, and it 

14           looks like there's about 107 of them in 

15           New York State, and they give out about 

16           $1.8 billion a year in economic development.  

17           And report after report, whether it's the 

18           Comptroller or an authority's budget office, 

19           they kind of give a collective "meh" to their 

20           performance.

21                  You know, most of them promised high, 

22           and then the chart shows over a 10-year 

23           period they come in lower.  And also, you 

24           know, there's been incident after incident of 


 1           economic development activity that was just 

 2           going to occur anyway -- like companies like 

 3           Medline, in Orange County, threatening to 

 4           move unless the IDA gave them dough.  It was 

 5           rejected, they built anyway, and I guess 

 6           that's been referred to the district 

 7           attorney's office.

 8                  But throughout my history here, I've 

 9           seen IDAs just really engaging in poaching 

10           from town to town, county to county, and also 

11           just needlessly subsidizing companies like 

12           Amazon.  Gates gave Amazon $150 million; Clay 

13           gave Amazon 70 million; East Fishkill gave 

14           Amazon 18 million; and 6 million in Hamburg, 

15           New York, which is in my area.  

16                  I would note that facility never 

17           opened, and also note the big winner in that 

18           project appears to be the Hamburg IDA, who 

19           retained $470,000 worth of fees -- and they 

20           don't get their fees clawed back if in fact 

21           they don't really make what they were 

22           supposed to make.  

23                  So what the question really comes down 

24           to is, do we need to rein in the IDAs?  Are 


 1           we happy with them subsidizing A&W Root Beer, 

 2           the Moe's, fast-food places, and Gold's Gym?  

 3           Is this the type of uplifting economic 

 4           development that we should be spending our 

 5           taxpayer dollars on and often taking money 

 6           from our schoolchildren to subsidize such 

 7           investment as Moe's Tacos and A&W Root Beer?  

 8                  To you, Mr. Silva.

 9                  MR. SILVA:  With 34 seconds to go, I 

10           will do my best --

11                  SENATOR RYAN:  Take your time, take 

12           your time.

13                  MR. SILVA: -- to respond to many of 

14           those discussions and conversations.  

15                  I would point first to the OSC report 

16           about annual IDA performance.  The 

17           $1.8 billion number you're quoting, I 

18           believe, is from an outside study.  I believe 

19           the number is significantly lower, based on 

20           OSC reporting, which was about $986 million 

21           net.  

22                  That being said -- 

23                  SENATOR RYAN:  Call it a billion.  

24           Just among friends.


 1                  MR. SILVA:  No -- I appreciate 

 2           "amongst friends", Senator.

 3                  And that certainly is something that 

 4           I'm willing to talk to and work with you 

 5           about.  For years we have been talking about 

 6           how do we modernize the Industrial 

 7           Development Agency general municipal statute.  

 8           And we look at the performance of IDAs and 

 9           what do IDAs do.  I firmly believe, and I 

10           think several of my colleagues up here would 

11           agree, that the IDAs remain the best local 

12           economic development tool we have in our 

13           community for retaining and creating jobs.  

14                  Which is part of it.  Retaining and 

15           creating jobs is a fundamental core part of 

16           economic development.

17                  CHAIRWOMAN KRUEGER:  I'm apologizing 

18           that even though he said take your time --

19                  MR. SILVA:  Right.

20                  (Laughter.)

21                  MR. SILVA:  Senator, can we take the 

22           conversation and continue it offline with 

23           your office?

24                  SENATOR RYAN:  We can.


 1                  MR. SILVA:  Thank you.

 2                  CHAIRWOMAN KRUEGER:  Thank you.

 3                  Assembly.

 4                  CHAIRWOMAN WEINSTEIN:  Assemblyman 

 5           Jones.

 6                  ASSEMBLYMAN JONES:  Good morning -- or 

 7           good afternoon, gentlemen.

 8                  MR. SILVA:  Good afternoon, 

 9           Assemblyman.

10                  ASSEMBLYMAN JONES:  This is kind of 

11           directed towards -- it is directed towards 

12           Mr. Silva.

13                  You know, we get up here every year, 

14           and every budget we see another program 

15           announced or a new program or other old 

16           programs.  And, you know, you're out in the 

17           business world, you're talking to businesses 

18           obviously, that is part of your job, and some 

19           programs work, some don't.

20                  What are you hearing back from 

21           businesses on the programs, the state 

22           programs, state-funded by all of our 

23           taxpayers?  What programs are working -- and 

24           be blunt.  What programs are working and what 


 1           programs aren't?  

 2                  Because we should continue -- and I 

 3           see this budget, and I'm disappointed in some 

 4           of the programs that haven't been 

 5           reappropriated.  Restore, I think, will work.  

 6           It's fairly new.  You've touched on the 

 7           amount of applications, and I think many of 

 8           our colleagues here have communities that 

 9           want to invest more or want to see them 

10           invest more in Restore NY.  

11                  Shovel Ready -- I'm kind of biased 

12           towards that, because it was my legislation.  

13                  But what programs out there are 

14           working and what aren't?  I will leave that 

15           to you.

16                  MR. SILVA:  Thank you very much, 

17           Assemblyman.  And from the perspective of the 

18           New York State EDC, I think I referenced 

19           several of the programs that we know are 

20           effective and efficient, and one of the 

21           things that we hear from the business 

22           community is consistency.

23                  Consistency is important.  If 

24           something is working, you continue to do it.  


 1           And if it works effectively, you invest 

 2           further with it.  Public-private 

 3           partnerships, because New York is a high-cost 

 4           state, is something that is necessary in 

 5           order for us to maintain our competitive 

 6           advantage.

 7                  So when I look at programs that are 

 8           effective, I look at a program like 

 9           Restore NY, a program like Shovel Ready.  The 

10           CATs and the COEs have been around since the 

11           mid-'90s.  The entire semiconductor industry 

12           was born out of the research and development 

13           that was being done at CNSE 30 years ago.  

14           The optics and photonics, the advanced 

15           materials -- those kinds of things I think 

16           are incredibly effective.

17                  And I will use this opportunity to say 

18           that if you look at the numbers, IDAs --  

19           industrial development agencies -- are 

20           effective.  Over 175,000 net new jobs in 

21           2020, the pandemic year when our state lost 

22           over a million jobs.  Those projects that 

23           IDAs were supporting helped grow 

24           167,000 jobs.


 1                  Not only that, IDAs are also helping 

 2           the state achieve its clean energy goals with 

 3           all the wind and solar projects that they are 

 4           bringing on to the market.

 5                  ASSEMBLYMAN JONES:  Thank you.

 6                  CHAIRWOMAN KRUEGER:  Thank you.

 7                  Senator Walczyk.

 8                  MR. SILVA:  And now I'm getting 

 9           hungry.

10                  (Laughter.)

11                  SENATOR WALCZYK:  Thank you, Chair.  

12                  How are we doing, gentlemen?

13                  MR. SILVA:  Senator.

14                  SENATOR WALCZYK:  Good.

15                  So the film tax credits, the 

16           Governor's added $280 million this year, for 

17           a record investment of $700 million.  A lot 

18           of money going towards post-production tax 

19           credits.

20                  ESD just testified that there is a 

21           nine-to-one return on investment for each of 

22           those dollars we give to Hollywood.  The 

23           Empire Center did a report on this, pretty 

24           in-depth, a few years ago, and they are 


 1           saying that taxpayers are spending over 

 2           $40,000 -- this is in 2019 dollars -- over 

 3           $40,000 per job in the film industry that is 

 4           produced.  

 5                  Who is right here?

 6                  MR. FROMMER:  With all due respect, 

 7           Senator, this is really not my area of 

 8           expertise.  I just don't feel comfortable 

 9           answering that question.

10                  MR. SILVA:  I will do my best to 

11           answer it.  Because we don't spend a ton of 

12           time focusing on the film tax credit, and I 

13           think it would go towards the broader 

14           conversation about tax-dollar-per-job created 

15           being a metric but not the only metric we 

16           really ought to look at.

17                  The reality is is the film industry 

18           creates and retains 57,000 good-paying union 

19           jobs in New York City.  Those are blue-collar 

20           jobs.  And I see what other states are doing. 

21           I look at what New Jersey is doing.  

22                  I'm going to use a little bit of 

23           anecdotal information.  I have three young 

24           kids.  I watch Disney+.  I see the Avengers 


 1           movies come on, and then I see that Georgia 

 2           logo with the peach, and it drives me crazy.  

 3           Those jobs and those productions should be 

 4           happening in New York.  I would rather see a 

 5           big apple as opposed to a peach logo at the 

 6           end of every one of those films.

 7                  So I understand the analysis that the 

 8           Empire State Center does.  But if you are 

 9           talking about the industry as a whole, 

10           without those tax credits, the industry will 

11           suffer tremendously.

12                  SENATOR WALCZYK:  Yeah, and here is 

13           the number that is difficult to drill down 

14           to.  So, you know, if we've been spending 

15           $400 million a year on those post-production 

16           tax credits and you're saying that's a 

17           retention of 57,000 jobs for New York City -- 

18           you know, as a Senator from upstate New York, 

19           I don't really care that much.  The Georgia 

20           peach doesn't offend me.  I would rather see 

21           taxes cut for businesses in my area and 

22           tourism promoted in my area for sure, but I 

23           can understand the greater picture here.

24                  What is $280 million in additional 


 1           taxpayer money that's going towards this 

 2           industry?  What is that going to produce for 

 3           New York City?  And does that mean that 

 4           57,000-job retention turns into 80,000 jobs, 

 5           90,000 jobs?

 6                  MR. SILVA:  I believe there is a panel 

 7           that will be coming up later this afternoon 

 8           that is probably more qualified to answer 

 9           that question than me.  My assumption and 

10           hope is that that would not only help retain 

11           but expand the number of jobs.

12                  SENATOR WALCZYK:  I'll ask them.  

13           Thanks.

14                  MR. SILVA:  You got it.  Thank you, 

15           Senator.

16                  MR. FROMMER:  And I'll just add that 

17           the best way to create jobs is to bring 

18           talent into New York, which is what I've been 

19           trying to focus on.

20                  CHAIRWOMAN KRUEGER:  Thank you.

21                  Assembly?

22                  CHAIRWOMAN WEINSTEIN:  We go to 

23           Assemblyman McDonald.

24                  ASSEMBLYMAN McDONALD:  Ryan, a 


 1           question for you.  

 2                  You know, IDAs -- you know, I'm biased  

 3           because I was chair for 13 years.  We did 

 4           some good things in revitalizing a city, but 

 5           I also understand there are some bad deals 

 6           that go on.  There are some bad actors.

 7                  Yesterday my colleagues had an event 

 8           which I thought was well-intended in regards 

 9           to the fact that -- let's face it, most of 

10           the taxes people pay in this state are school 

11           taxes.  Is your entity supportive of -- I 

12           mean, my first thing that I did as mayor is I 

13           put a school board representative on my 

14           board.

15                  MR. SILVA:  Sure.

16                  ASSEMBLYMAN McDONALD:  Do you guys 

17           support that?

18                  MR. SILVA:  I would say that every 

19           community is different, Assemblyman.  

20                  And I appreciate you calling me 

21           "Ryan."  Please refer to me as "Ryan" moving 

22           forward instead of "Mr. Silva."  

23                  (Laughter.)

24                  MR. SILVA:  Yes.  I've known the mayor 


 1           for almost 20 years now.  

 2                  I do know that actually several 

 3           industrial development agencies have 

 4           modernized and do have school representation 

 5           on their boards of directors. I think it is a 

 6           good idea.  

 7                  I cannot speak to 107 IDAs, whether or 

 8           not they should.  But I believe having them 

 9           at the table and part of the conversation 

10           makes those discussions about the proposals 

11           and the investments that are being made by 

12           IDAs and why and how they benefit schools.

13                  ASSEMBLYMAN McDONALD:  Let me ask you, 

14           another discussion that comes up -- which has 

15           merit, I'm not dismissing this -- is that -- 

16           and, you know, Sean had mentioned 

17           $1.8 billion is taken out of taxpayers.  I 

18           get that.  

19                  However, just to be clear, the 

20           majority of projects that your members deal 

21           with, I'm assuming that this is growth.  In 

22           other words, does the tax base expand at all?  

23                  I look across the river at Rensselaer 

24           County:  Regeneron invested $800 million.  


 1           They are paying more in taxes than what was 

 2           there before, correct?

 3                  MR. SILVA:  Significantly more.  And 

 4           their PILOT payment is significantly more.

 5                  ASSEMBLYMAN McDONALD:  Right.

 6                  MR. SILVA:  And that's a -- that's the 

 7           perspective that we view this lens through, 

 8           is yes, you can say there are some projects 

 9           that may have happened otherwise.  And the 

10           Senator pointed to one that was very public 

11           recently.  I cannot sit here and say 4262 

12           projects or every -- all of them are projects 

13           that we would support and we would say are 

14           good.  I would say that any growth is a net 

15           benefit back.  

16                  And the assumption that those projects 

17           would all happen anyways just isn't 

18           realistic.  

19                  So it's net growth to the school 

20           districts.

21                  ASSEMBLYMAN McDONALD:  And how many 

22           jobs have been created over there at 

23           Regeneron alone?

24                  MR. SILVA:  Regeneron?  Thirty-seven 


 1           hundred fifty-four -- thousand -- somewhere 

 2           in that range --

 3                  ASSEMBLYMAN McDONALD:  Which is more 

 4           than Global Foundries.  No disrespect to --

 5                  MR. SILVA:  Oh, Assemblywoman 

 6           Woerner's not here, I won't touch that one.

 7                  ASSEMBLYMAN McDONALD:  Question.  Last 

 8           comment, because I understand -- and, you 

 9           know, as we know, the Comptroller's office 

10           has clear oversight over the IDAs.  What's 

11           been lost in the discussion for the last 

12           23 years I've been in government is these 

13           local development corporations are growing up 

14           with three people on a corner, and they're 

15           spending a ton of taxpayers' money with very 

16           limited oversight because the ABO is 

17           minuscule in this effort.  No disrespect to 

18           them.

19                  Thank you.

20                  CHAIRWOMAN KRUEGER:  Thank you.

21                  Senator Borrello.

22                  SENATOR BORRELLO:  Thank you, 

23           Madam Chair.

24                  Mr. Silva, good to see you.


 1                  MR. SILVA:  Senator.

 2                  SENATOR BORRELLO:  A question for you, 

 3           the same question I asked Hope Knight.  You 

 4           know, we're talking about eliminating natural 

 5           gas.  There are very few industries, 

 6           particularly manufacturing, that can survive 

 7           without natural gas where the technology does 

 8           not exist.  How are we going to replace the 

 9           massive loss of jobs and economic impact from 

10           eliminating natural gas?

11                  MR. SILVA:  I don't have the answer to 

12           that.  

13                  What I will say is the position of the 

14           New York State EDC is that we have long 

15           supported our members, industrial development 

16           agencies and others -- reducing our carbon 

17           footprint is something we should 100 percent 

18           aspire to do.  Bringing more clean energy 

19           onto the grid, whether it's wind, solar, 

20           hydro, is something we all should be trying 

21           to achieve.

22                  So we in principle support the CLCPA.  

23           We should be trying to reduce our carbon 

24           footprint.  At the same time, we have to 


 1           recognize that the timetable needs to work so 

 2           that it doesn't put New York State at a 

 3           competitive disadvantage.

 4                  You highlighted natural gas, and I'm 

 5           very familiar with the project that you 

 6           referenced in your district.  Can't happen.  

 7           Won't happen without access to natural gas.  

 8           And I believe, as the CLCPA scoping plan is 

 9           being developed, there are carveouts and 

10           there are provisions that would ensure 

11           manufacturers that need access to natural gas 

12           will have access to it.  

13                  SENATOR BORRELLO:  For a limited time.

14                  MR. SILVA:  For a limited time.  With 

15           the hope that -- well, I don't believe they 

16           completely phase it out 100 percent, but I 

17           would have to look at it.

18                  SENATOR BORRELLO:  Yeah.  So it would 

19           be far more expensive.  So why wouldn't you 

20           just pick up and move to Pennsylvania?

21                  MR. SILVA:  I don't want them to move, 

22           Senator.  I want them to stay here.

23                  SENATOR BORRELLO:  Five miles away.

24                  MR. SILVA:  Yeah, and that's a real 


 1           challenge.  

 2                  SENATOR BORRELLO:  If you make it 

 3           unaffordable -- 

 4                  MR. SILVA:  And we are concerned with 

 5           the timetable and our ability to meet that.  

 6           In order for us to meet the reduction in 

 7           greenhouse gas -- whether it's coal, natural 

 8           gas, we can argue about nuclear being clean 

 9           or not clean -- in order for us to keep up 

10           with the demand, we have to exponentially 

11           grow the amount of wind, the amount of solar, 

12           the amount of hydro we produce here in 

13           New York.  

14                  And on top of that, we also have to 

15           figure out how do we get it into transmission 

16           lines, how do we modernize that 

17           infrastructure, and how do we get it into 

18           places in New York State that it's needed.

19                  So we are supportive of the CLCPA, but 

20           we continue to hope that this will not 

21           negatively impact our economic development 

22           attraction efforts.

23                  SENATOR BORRELLO:  I would say that 

24           your support of the CLCPA is divorced from 


 1           the reality of what it means to have economic 

 2           development in New York State.  With all due 

 3           respect, I think you guys do a great job, you 

 4           know, I'm a big supporter of the IDAs, I 

 5           spent 10 years in county government.  But 

 6           this is not reality-based.  And until it is, 

 7           we are going to have a big problem.  

 8                  And you can blanket all of New York 

 9           State with wind and solar, and it won't be 

10           enough power to replace the need that we're 

11           going to have, and that's the real issue.

12                  CHAIRWOMAN KRUEGER:  Thank you.  

13                  Assembly?

14                  CHAIRWOMAN WEINSTEIN:  We go to 

15           Assemblyman Rivera.

16                  MR. SILVA:  Assemblyman, how are you, 

17           sir?

18                  ASSEMBLYMAN RIVERA:  Good.  Good.

19                  I don't know if we've met yet.  I'm 

20           one of the new folks.  I'm happy we're 

21           meeting right now.

22                  I have a couple of questions, and 

23           given how short my time is, if you could give 

24           me relatively sort of yes or nos on this.


 1                  MR. SILVA:  I'll do my best, 

 2           Assemblyman.

 3                  ASSEMBLYMAN RIVERA:  And they're all 

 4           going to be about IDAs.

 5                  MR. SILVA:  Sure.

 6                  ASSEMBLYMAN RIVERA:  So are there 

 7           particular industries that you think the IDA 

 8           should not be granting abatements to?  For an 

 9           example, a fast-food restaurant?  Do you feel 

10           we can impose some sort of straight standard 

11           and say, you know what, regardless of 

12           everything else, fast-food restaurants 

13           shouldn't receive anything, yes or no?

14                  MR. SILVA:  I will work with you and 

15           the Senator on the bill that you are 

16           potentially introducing around a third-party 

17           study.  I would be very interested in working 

18           with you on that.

19                  ASSEMBLYMAN RIVERA:  Okay.  

20                  What is your position on town IDAs 

21           within counties that already have county 

22           IDAs?

23                  MR. SILVA:  I think it really does 

24           depend.  I know there's seven, eight in 


 1           Erie County, right?

 2                  ASSEMBLYMAN RIVERA:  Five or so.

 3                  MR. SILVA:  Is it six?  I apologize, I 

 4           don't know -- seven.  I was around it.  

 5                  It's very hard for me to say that the 

 6           City of Albany shouldn't have its own 

 7           industrial development agency and the county 

 8           should.  The economies are very uniquely 

 9           different.  It works in some areas; it works 

10           in others.

11                  ASSEMBLYMAN RIVERA:  Would you support 

12           some other funding mechanism for IDAs?  I 

13           think that there's a deep, deep disincentive 

14           that IDAs have to essentially agree to bad 

15           deals when they're in front of them.  But as 

16           long as they seem to reap the benefit of a 

17           bad deal, what's really preventing them from 

18           making more bad deals?

19                  So do you -- would you think that -- 

20           you know, is there -- are you open to sort of 

21           supporting another idea of how IDAs can 

22           actually -- 

23                  MR. SILVA:  Generate revenue for 

24           operational purposes?


 1                  ASSEMBLYMAN RIVERA:  Yeah.

 2                  MR. SILVA:  There's models.  The 

 3           Schenectady Metroplex, I think, is a good 

 4           model, that they have the City of 

 5           Schenectady's IDA, the County of 

 6           Schenectady's IDA under one umbrella.  They 

 7           have a consistent revenue stream which allows 

 8           them to pursue other projects.  

 9                  There's a model in Texas that actually 

10           the state provides funding for local regional 

11           economic development efforts to operate their 

12           offices.  So, open and willing to 100 percent 

13           discuss other funding mechanisms.

14                  ASSEMBLYMAN RIVERA:  Would you support 

15           an idea, sort of like a universal wage floor, 

16           considering local demographics?  If we were 

17           to say something like, Okay, you know, if 

18           we're going to grant some sort of benefit to 

19           an entity, whether it be Amazon or whether it 

20           be anything else, that there's a minimum wage 

21           that they have to employ people at if they're 

22           going to receive a benefit?  And that minimum 

23           wage can take into account whatever local 

24           nature, market, whatever dictates.  


 1                  Would you support something like that?

 2                  MR. SILVA:  No, and I'll -- can I 

 3           caveat with why?  

 4                  Because I don't believe that jobs 

 5           created and retained is the only thing that 

 6           industrial development agencies should be 

 7           looking at when determining whether or not 

 8           they want to support a project.  Because 

 9           we've talked about blight reduction, we've 

10           talked about clean energy production, and 

11           those things are important things that I 

12           think IDAs should be working on that don't 

13           necessarily tie strictly to job growth.

14                  Good job, paying -- yes.  We should be 

15           looking at good-paying jobs.

16                  CHAIRWOMAN WEINSTEIN:  Thank you.

17                  Senate?

18                  CHAIRWOMAN KRUEGER:  Thank you.

19                  Next is Senator Murray.

20                  SENATOR MURRAY:  Thank you very much 

21           to both of you for being here.  

22                  Thank you, Chairwoman.

23                  Director Silva, first let me make a 

24           statement about IDAs.  Big fan, with one 


 1           caveat, and that caveat is that when we're 

 2           providing New York taxpayer incentives to 

 3           companies to hire, those hires should be 

 4           New York State residents.  Out-of-state hires 

 5           should not count anytime.  Just my statement.

 6                  I want to move on to something else.  

 7           Assemblyman Stirpe brought up a great point 

 8           in the last segment about the tying in of 

 9           workforce development with childcare.  And 

10           I'll ask a couple of questions and then wait 

11           for your response here.  

12                  So in speaking with businesses and 

13           workers, in addition to job training, one of 

14           the top issues I hear is the struggle with 

15           childcare.  Do you think it would be a good 

16           idea to create more incentives for businesses 

17           to create and have on-site childcare 

18           services?  And I know we do some, but could 

19           we increase that?  And would that get more 

20           people back into the workforce?  (Pause.)

21                  Or did I ask the wrong person?

22                  (Laughter.)

23                  MR. SILVA:  No, no.  I mean, I 

24           don't -- I don't want to -- 


 1                  MR. FROMMER:  Again, you know, not my 

 2           area of expertise, but I will say this, and 

 3           this is just my anecdotal recall.  At 

 4           Columbia University Medical Center, in the 

 5           pandemic we had many challenges, but one of 

 6           the challenges we had was childcare for our 

 7           nurses, our doctors, our environmental health 

 8           professionals, folks who couldn't work at 

 9           home, folks who we needed on campus.  

10                  And everything we tried to do to make 

11           it work -- a lot of the barriers were, okay, 

12           what do these people do with their kids?  

13           Because they can't go to school, they're 

14           afraid that -- "afraid" may be the wrong 

15           word.  Babysitters weren't an option, 

16           whatever it was.  That -- all's I can say -- 

17           from, you know, again my perspective, during 

18           the pandemic that was one of our greatest 

19           challenges.

20                  MR. SILVA:  I would just add that 

21           incentivizing it is part of the challenge, 

22           but the logistical challenges from a 

23           regulatory standpoint of opening an on-site 

24           childcare facility for a manufacturing 


 1           company, let's say, for example -- to say it 

 2           is burdensome would be an understatement.

 3                  I think that it warrants looking at, 

 4           is there a way to streamline the process by 

 5           which a childcare facility which may be 

 6           attached to an industry-attraction effort  

 7           becomes more simplified?  The same thing 

 8           we're trying to do with the Shovel Ready 

 9           initiative.  We're trying to streamline the 

10           local zoning and approval processes as we 

11           incentivize people to come here.

12                  There can be some things, I think, 

13           done that would simplify that.  I don't have 

14           those answers because I'm not a childcare 

15           expert, but I would welcome engaging them in 

16           that conversation.

17                  SENATOR MURRAY:  Yeah, and I will say 

18           the Governor -- I give her nothing but credit 

19           here -- for the last year, and again this 

20           year, she has shown not only a willingness 

21           but a desire to tackle this issue, and I look 

22           forward to working with her on it.  

23                  And we should reduce the regulatory 

24           obstacles, as long as safety and health is -- 


 1           that must stay in place.  But we can speed up 

 2           the process too, I think.

 3                  So thank you very much.  

 4                  MR. SILVA:  Thank you, Senator.  

 5                  CHAIRWOMAN KRUEGER:  Thank you.  

 6                  Assembly.

 7                  CHAIRWOMAN WEINSTEIN:  Assemblyman 

 8           Gray.

 9                  ASSEMBLYMAN GRAY:  Thank you very 

10           much, gentlemen.  Appreciate your time, 

11           spending it with us today.

12                  I just want to hear some of your 

13           thoughts on -- so I come at this from the 

14           experience that I sat in an IDA, I sat on the 

15           REDC, and I also sat on the REDI Commission.  

16                  So the IDAs definitely we know is a 

17           local approach; REDCs, more of a top-down 

18           approach.  And the REDI Commission was more 

19           of an in-between approach, if you're familiar 

20           with that commission, that incorporated some 

21           strong oversight from the state as well as a 

22           tremendous amount of local input on project 

23           selection.  

24                  So just a little bit on your thoughts 


 1           on what do you think the best approach is for 

 2           New York State in terms of economic 

 3           development.  

 4                  And then, secondly, a minimum wage 

 5           that's indexed to inflation is an important 

 6           thing.  I think as many people know, if 

 7           they're in business, we all know that -- the 

 8           labor shortage that's going on out there.  

 9           And supply and demand is really driving wages 

10           right now.  

11                  Does it require government 

12           intervention at this point in time?  Or is 

13           the marketplace taking care of it?

14                  MR. SILVA:  Thank you, Assemblyman.  I 

15           only had two out of those three.  I did the 

16           Regional Councils.  And I haven't worked at 

17           an IDA, but certainly they make up a good 

18           group -- portion of our membership.

19                  New York State is a home rule state.  

20           And so long as New York State is a home rule 

21           state, I think local control, local 

22           engagement, ground-up economic development 

23           more holistically across the board is 

24           fundamentally the best approach.


 1                  Nobody knows their community better 

 2           than the people who live in it.  Those who 

 3           work at industrial development agencies, 

 4           they're public servants, they're public 

 5           employees who live in the communities that 

 6           they serve, and ultimately they want to see 

 7           the quality of life in their communities 

 8           grow, increase, and do better.

 9                  The Regional Economic Development 

10           Council model is a great model because 

11           when -- you can collaborate around a regional 

12           strategy.  So there are instances where it 

13           makes sense for -- the focus on 

14           semiconductors in one region makes sense, the 

15           focus on optics and photonics, on life 

16           sciences.  So developing strategies and then 

17           identifying projects makes sense.  

18                  But they all have to work together.  

19           The state, Empire State Development, has to 

20           be working collaboratively with IDAs, vice 

21           versa with other state agencies.  And I would 

22           say we're in a really good place right now 

23           with that relationship.

24                  So on the second part, I would defer 


 1           to the Business Council.  You know, we 

 2           recognize that minimum wage is a very 

 3           important topic.  I know the Governor 

 4           proposed indexing it.  That is something that 

 5           we would not oppose.

 6                  MR. FROMMER:  It will not surprise you 

 7           to add that my answer is going to be similar 

 8           to the previous answers to the previous 

 9           questions.

10                  The best way to do this is to attract 

11           talent.  Especially when you're talking about 

12           science, because there is so much federal 

13           money out there.  The more talent you have in 

14           this state, the more economic activity, the 

15           more jobs, the more startups, the more 

16           intellectual property you're going to have.

17                  CHAIRWOMAN KRUEGER:  Thank you.

18                  Senator Oberacker.

19                  SENATOR OBERACKER:  Good afternoon.  

20           My question is for Vice President Frommer.

21                  You know, early on in my career I was 

22           a food scientist who then kind of transformed 

23           into a research chef, so where we've merged 

24           kind of the two philosophies of culinary and 


 1           science.  Representing over seven counties, 

 2           one of which is the Schoharie County, 

 3           Schoharie Valley.  Really was the 

 4           breadbasket, if you will, of New York during, 

 5           you know, revolutionary times.

 6                  Is there any thought to potentially 

 7           opening up what we're doing here for a 

 8           food-side premise?  And the reason I say that 

 9           is because if you really think about it, 

10           three times a day we're consuming some food.  

11           What better delivery system, if you will, to 

12           improve upon health?  

13                  And I'll leave you with this quote:  

14           An apple a day.

15                  So with that, I would like to hear 

16           your thoughts.  

17                  MR. FROMMER:  Well, first, Senator, I 

18           should note that it has been 25 years, but I 

19           used to live in Otsego County.  I lived there 

20           for two and a half years and spent a lot of 

21           time there, so I know that area of the state 

22           pretty well.  I was Senator Moynihan's 

23           upstate director, so I covered 33 counties, 

24           including Schoharie County, so I also spent 


 1           some time there as well.  

 2                  Not my area of expertise.  My focus is 

 3           biomedical research.  But I believe the model 

 4           of attracting talent and the research dollars 

 5           that follows that talent is a good model.  

 6           And likewise, when you lose that talent, you 

 7           don't just lose the great researcher or the 

 8           great chef or whatever the area of expertise 

 9           may be -- you lose all their research 

10           funding.

11                  The way that NIH works, the RO1 grant, 

12           it is specifically tied not to the 

13           institution but to the primary investigator.  

14           So when we bring someone in, we're not just 

15           bringing in a brilliant scientist, we're 

16           bringing in a million, $2 million, $3 million 

17           in existing grants.  And there's going to be 

18           future grants.  

19                  So, yes, I happen to think -- my 

20           biased, if you want to call it that -- this 

21           is a good model for any type of science.

22                  SENATOR OBERACKER:  And being on the 

23           Higher Ed committee as well, I have 

24           Cobleskill College, I have of course SUNY 


 1           Oneonta, now SUNY University, or University 

 2           at Oneonta, which have some nutritional and 

 3           other programs.  I just think it would be a 

 4           perfect tie-in.  And what better way to 

 5           extend out these monies that we are 

 6           allocating.  And again, I go back to an ROI.  

 7           I think it would be a fantastic ROI.

 8                  So thank you for that.  Thank you for 

 9           the work you're doing.  And if you need a 

10           county to roll this out in, or a district to 

11           roll this out in, I'd be more than happy to.

12                  MR. FROMMER:  Well, Senator, you 

13           should know that Columbia has a very strong 

14           relationship with Bassett Healthcare in 

15           Cooperstown, a specific program where we have 

16           medical students who do, I want to say, a 

17           year and a half of medical school in 

18           New York, do their basic sciences, and then 

19           do their clinical years up at Bassett.

20                  SENATOR OBERACKER:  Perfect.  Thank 

21           you.

22                  CHAIRWOMAN KRUEGER:  Thank you.

23                  I believe the Assembly is complete, so 

24           Senator O'Mara to close for the Senate.


 1                  SENATOR O'MARA:  Great.  Thank you.

 2                  And good afternoon.  You know, maybe 

 3           just a comment, maybe a response from you, 

 4           Mr. Silva, on this.

 5                  You know, I serve on the Southern Tier 

 6           Regional Economic Development Council, and 

 7           it's very frustrating in that role that, 

 8           still, every decision is made here in Albany 

 9           on the Second Floor, virtually, despite the 

10           input and the work that the regional members 

11           do on all these projects.  And a lot of 

12           projects that are very highly recommended, 

13           unanimously recommended from the regional 

14           council fall on deaf ears here in Albany and 

15           don't get funded with any state program 

16           dollars.

17                  And a lot of those, the only 

18           incentives they can get come locally from the 

19           local IDA.  And without those local IDAs, the 

20           local governments wouldn't have any 

21           opportunity to incentivize the projects in 

22           their areas that are not approved at the 

23           state level.  

24                  And I just think that having that 


 1           local ability to provide these incentives is 

 2           critically important in many areas of the 

 3           state, particularly the very depressed 

 4           Southern Tier region of New York State that I 

 5           represent a large portion of.

 6                  So I just want to thank you for the 

 7           work of all the IDAs in the state that 

 8           provide this important work and do help us 

 9           provide industries.  Can we improve on 

10           things?  I'm sure we can.  But it just seems 

11           to me that they are a very valuable asset 

12           that we need to have when every other 

13           decision is made on the second floor of the 

14           State Capitol.

15                  Thank you.

16                  MR. SILVA:  Thank you, Senator.  

17                  CHAIRWOMAN KRUEGER:  Thank you.  

18                  And actually the Assembly did realize 

19           they have some more questions.

20                  Helene Weinstein.

21                  CHAIRWOMAN WEINSTEIN:  A question for 

22           Mr. Silva.

23                  Some years ago there were 

24           presentations of the Regional Economic 


 1           Councils to the SIAT, the Strategic --

 2                  MR. SILVA:  -- Implementation 

 3           Assessment Team.  

 4                  CHAIRWOMAN WEINSTEIN:  Okay.

 5                  MR. SILVA:  I still remember the 

 6           acronym.

 7                  CHAIRWOMAN WEINSTEIN:  Good.  

 8                  Does that still exist?

 9                  MR. SILVA:  That's a good question.  I 

10           know they've moved away from doing the annual 

11           once-a-year award ceremony to more of a 

12           rolling process on the Empire State 

13           Development -- which we think's a good thing, 

14           right, because economic development happens 

15           more than one time a year.

16                  CHAIRWOMAN WEINSTEIN:  But -- why 

17           don't I stop you.  Let me just --

18                  MR. SILVA:  Yeah, yeah.

19                  CHAIRWOMAN WEINSTEIN:  So when I 

20           became chair of Ways and Means, I was 

21           appointed as the Assemblymember to the SIAT.  

22           Assemblywoman Donna Lupardo was also 

23           appointed to the SIAT.  For a couple of years 

24           we were invited to the presentations of the 


 1           REDCs.  I haven't been invited to anything in 

 2           the past two years.  

 3                  I would agree with Senator O'Mara that 

 4           the recommendations didn't necessarily follow 

 5           what the awards were, but we did meet.  I 

 6           actually participated at the award ceremonies 

 7           up here.  But I'm just really curious if that 

 8           strategic task force still exists, how it was 

 9           authorized in the first place, and if it's 

10           been disbanded.  I'm not necessarily looking 

11           for more work, but I'm really curious about 

12           why I haven't been informed either that it's 

13           been disbanded or that there are meetings 

14           that I should be attending.

15                  MR. SILVA:  Yeah.  Assemblywoman, I do 

16           not -- I unfortunately do not have an answer 

17           to that question.  I think that is a question 

18           that Empire State Development could provide 

19           an answer to.

20                  CHAIRWOMAN WEINSTEIN:  Okay.

21                  MR. SILVA:  We used to go out and do 

22           some road shows, too.

23                  CHAIRWOMAN WEINSTEIN:  Right.  Yeah.

24           And that was actually very informative.


 1                  MR. SILVA:  Yeah, absolutely.

 2                  CHAIRWOMAN WEINSTEIN:  Well, I will 

 3           follow up, then, with Hope Knight.  I 

 4           neglected to ask her when she was here.

 5                  Thank you.

 6                  CHAIRWOMAN KRUEGER:  Thank you both, 

 7           gentlemen, for being with us.

 8                  MR. FROMMER:  Thank you.

 9                  MR. SILVA:  Thank you, Senator.

10                  CHAIRWOMAN KRUEGER:  Thank you.

11                  MR. SILVA:  Thank you, 

12           Assemblymembers. 

13                  CHAIRWOMAN KRUEGER:  Next we're 

14           calling up Panel C:  New Yorkers for Fiscal 

15           Fairness, Ron Deutsch; Strong Economy for All 

16           Coalition, Michael Kink; and Reinvent Albany, 

17           Elizabeth Marcello.

18                  Good afternoon.  Okay, I guess we'll 

19           go in the order I see you in, starting with 

20           Ron Deutsch. 

21                  MR. DEUTSCH:  All right.  Well, thank 

22           you very much.  I appreciate the opportunity 

23           to testify here.  Thank you to the 

24           distinguished members of the various 


 1           committees.

 2                  This is my 30th time appearing before 

 3           you.  It is our pearl anniversary we can 

 4           celebrate together, so that's wonderful.  I 

 5           won't be giving you any pearls, but maybe 

 6           drop a few pearls of knowledge that I have 

 7           accumulated over the last 30 years of 

 8           frustration trying to reform economic 

 9           development programs.

10                  Let me start with the fact that I 

11           think, first and foremost, we should be 

12           freezing any new tax incentives, tax 

13           abatements, and tax credits in particular to 

14           businesses in New York State this year.  

15                  Right now we are in the midst of a 

16           study that's being done by PFM looking at all 

17           the different tax credit programs New York 

18           State operates.  Perhaps we should wait until 

19           next year to get the results of that study to 

20           determine whether or not these tax incentives 

21           are effective.  All research I've seen from 

22           credible economists show that they are not 

23           effective and that they do not create jobs in 

24           the way that many folks are saying they do.


 1                  So rather than doubling down this year 

 2           with new tax credits, perhaps we should be 

 3           freezing them instead.  

 4                  I would also suggest that when it 

 5           comes to IDAs, Senator Ryan and Assemblyman 

 6           Bronson, both chairs of their respective 

 7           committees, have introduced legislation that 

 8           would prevent IDAs from abating school taxes.  

 9                  We released a report yesterday -- or 

10           Good Jobs First released an amazing report 

11           yesterday that was only possible as the 

12           result of some data victories that we've had 

13           with the Government Accountability Standards 

14           Board.  But we're realizing now we are losing 

15           nearly $2 billion in school revenue that IDAs 

16           are doling out each year, and in particular 

17           in 2021.

18                  So that report really details those 

19           losses, and does so by school district.  We 

20           would be happy to make sure we provide that 

21           to you.

22                  I would also like to say that -- in my 

23           limited time here -- we need to start 

24           redefining and reframing and redirecting how 


 1           we think about economic development here in 

 2           New York State.  

 3                  I will tell you this.  What is real 

 4           economic development?  SUNY and CUNY are real 

 5           economic development in New York State.  

 6           Childcare investments are real economic 

 7           development in New York State.  When you 

 8           think about SUNY and CUNY alone, let's look 

 9           at the fact that there's nearly a $30 billion 

10           economic impact, there's an $8 return for 

11           every dollar invested in SUNY.  CUNY 

12           graduates earned a combined $57 billion 

13           annually -- $28 billion more than individuals 

14           without a college education -- and CUNY 

15           graduates paid about $4.2 billion in state 

16           income taxes.  

17                  SUNY would be one of the top 10 

18           employers in New York State -- employs about 

19           80,000 faculty and staff.  

20                  And the most important statistic I 

21           think I can impart to you in my few seconds 

22           left is that when we talk about outmigration 

23           and stemming outmigration, about 78 to 

24           79 percent of students that graduate SUNY and 


 1           CUNY remain in New York State and work in 

 2           New York State full-time.  

 3                  That is economic development.

 4                  CHAIRWOMAN KRUEGER:  Thank you.

 5                  MS. MARCELLO:  Thank you all for the 

 6           opportunity to testify.  I am Elizabeth 

 7           Marcello.  I'm a senior research analyst at 

 8           Reinvent Albany.  We advocate for open, 

 9           accountable state government.  

10                  Reinvent Albany strongly supports 

11           broad, fair, evidence-based New York State 

12           investments in physical, social, and 

13           workforce infrastructure.  Think Erie Canal, 

14           clean water, MTA capital plan, universal 

15           pre-kindergarten, childcare, community 

16           colleges, and technical education.  These 

17           forms of economic development produce a high 

18           return on the taxpayer's investment.  

19                  We also support state efforts to help 

20           bring the private sector by modernizing 

21           licensing processes, ensuring regulations are 

22           sensible and taxes and fees are fair and 

23           reasonable.

24                  Unfortunately, New York State is 


 1           spending an estimated $5 billion a year on 

 2           economic development, mostly in the form of 

 3           tax breaks for big businesses.  The state 

 4           theory is that wealthy business owners will 

 5           use state subsidies to hire people to create 

 6           more wealth for the business owner.  This 

 7           used to be called "trickle down" economics.  

 8           Baked into this state subsidy logic is that 

 9           wealthy business owners will not hire more 

10           employees or grow their businesses without 

11           these subsidies, and this is completely 

12           untrue.  

13                  New York State's most authoritative 

14           study of business subsidies remains the 

15           2013 report to the Governor's Tax Reform and 

16           Fairness Commission, which, as Assemblymember 

17           Bronson noted, said business incentives 

18           violate principles of good tax policies and 

19           tenets of good budgeting.  

20                  And research conducted since the 

21           mid-1950s does not show that they impact net 

22           economic gains.  And I would add that in fact 

23           there is an overwhelming national consensus 

24           among independent experts from the left, 


 1           right, and center that government subsidies 

 2           to businesses are a very ineffective use of 

 3           public funds.

 4                  We strongly recommend that New York 

 5           State moves towards economic development 

 6           based on facts, fairness, and measurability.  

 7           Sadly, the Governor's budget doubles down on 

 8           discredited, politically driven economic 

 9           spending and bad public policy.

10                  One example among dozens:  Community 

11           colleges produce a very high return on 

12           investment for public funding and house a 

13           substantial portion of the state's workforce 

14           development programs.  Yet the Governor wants 

15           to cut funding for community colleges upstate 

16           by 8.8 percent, to $735 million, while 

17           raising the film tax credit by 55 percent, to 

18           $700 million a year.

19                  Regarding the Governor's budget, we 

20           urge the Legislature to reject billions of 

21           new and expanded state business subsidies.  

22           That means no to expansion of film tax 

23           credits; no to theatrical tax credits; no to 

24           resurrecting START-UP NY as EPIC; no to the 


 1           expansion of the Excelsior Tax Program; no 

 2           state financing for horse-racing facilities; 

 3           no to state subsidies for sports stadiums, 

 4           arenas, convention centers; no to the 

 5           extension of inefficient 421-a tax 

 6           abatements; freeze existing subsidies; and 

 7           roll back select subsidies like ending the 

 8           New York State Opportunity Zone tax abatement 

 9           program.

10                  Thank you very much.

11                  CHAIRWOMAN KRUEGER:  Thank you.

12                  Mr. Kink.

13                  MR. KINK:  Hi.  Thanks to the chairs 

14           and the members.  Appreciate the opportunity 

15           to testify.

16                  I'll be the third person on the panel 

17           to say we should be investing public funds in 

18           public goods, things that benefit all 

19           communities -- in education, early education, 

20           higher education, in clean energy, in 

21           housing, in beautiful public parks.  Those 

22           are the kinds of things that benefit all 

23           communities and all businesses and provide a 

24           real payoff.


 1                  We've talked about higher ed and 

 2           childcare and early education.  Investments 

 3           in those public programs have a 12-to-one 

 4           payoff in the lowest-income communities and 

 5           an across-the-board eight-to-one payoff, as 

 6           documented by the studies of the 

 7           Federal Reserve Bank of Minneapolis.  

 8                  Commissioner Knight sat here and said 

 9           that she viewed the cost-benefit analysis as 

10           $1 above what they invest?  If you can get a 

11           12-to-one payoff investing in low-income 

12           children, you should do that.

13                  The problem we have here is a system 

14           that doesn't work.  And I don't think it's a 

15           Commissioner Knight problem, I think it's a 

16           systemic structural problem.  

17                  Ms. Jackson asked about hiring and 

18           workforce for young people and people of 

19           color.  No answers.  Mr. Stirpe asked about 

20           clean energy being robbed by Micron.  It was 

21           clear they're robbing the clean energy.  No 

22           resolution, no discussion.  Mr. Bronson asked 

23           about equity and inclusion.  No data, no 

24           plans.  Chair Ryan asked about the details on 


 1           data, basic facts.  Last year the Senate held 

 2           like an eight-hour, nine-hour hearing, and it 

 3           was clear, over and over, they didn't have 

 4           the basic facts.

 5                  When outsiders have established the 

 6           facts, we've found, you know, total 

 7           corruption and ripoffs.  Yesterday the report 

 8           was released that IDAs have defunded local 

 9           school districts to the tune of $1.8 billion.  

10           Some districts lose $10,000 per child because 

11           of the tax breaks that IDAs are giving out -- 

12           to fast-food companies?  You know, to a car 

13           dealer?  It's crazy.

14                  The other thing that's happening is 

15           large-scale projects that benefit 

16           billionaires.  Tesla, the Buffalo Bills 

17           stadium, the Penn Station redevelopment, even 

18           Belmont and the billionaires' playthings with 

19           horses -- all of those benefit Elon Musk, 

20           they benefit Steven Roth and Stephen Ross, 

21           they benefit the Pegulas.  Those are 

22           billionaire business leaders.  They don't 

23           need public money the way that low-income 

24           people, homeless people, schoolkids, and 


 1           public universities need money.

 2                  We should be investing in public 

 3           goods.  And I'll will agree with Ron, we 

 4           should absolutely press "pause" on any new 

 5           subsidies while the audit is ongoing.  We 

 6           should pass the Ryan-Bronson bill to crack 

 7           down on IDAs that defund local school 

 8           districts.  We should look at Ron Kim's bill 

 9           that would put an across-the-board stop on 

10           all economic development programs.

11                  If we took five years and every year 

12           we took 20 percent of the giveaways and we 

13           invested that in people and communities, we'd 

14           get a better payoff and you all would be able 

15           to show concrete returns to your 

16           constituents.

17                  Thank you.

18                  CHAIRWOMAN KRUEGER:  Thank you.

19                  A question by Senator Sean Ryan.

20                  SENATOR RYAN:  So the 2013 report you 

21           referenced seemed to suggest that the 

22           billion dollars of economic development money 

23           we're spending wasn't working.  Is that 

24           accurate?


 1                  MS. MARCELLO:  That is accurate.

 2                  SENATOR RYAN:  But how could it be -- 

 3           with all the ribbon cuttings, the 

 4           groundbreakings, gold shovels -- that this 

 5           hasn't yielded the strongest economy of any 

 6           of the 50 states?  If we're spending so much 

 7           on this, why doesn't it work?

 8                  MS. MARCELLO:  It's hard to believe, 

 9           isn't it?

10                  SENATOR RYAN:  It's hard to believe.

11                  MS. MARCELLO:  It's hard to believe.  

12                  But every independent analysis -- this 

13           is analyses that are not funded by the 

14           agencies themselves, not funded by trade 

15           groups, not funded by special interests -- 

16           has shown that business subsidies do not 

17           work.

18                  MR. DEUTSCH:  And I think, too -- I 

19           mean, I'll quote former Mayor Mike Bloomberg 

20           here when he said that, you know, if your 

21           business plan is dependent on public 

22           subsidies and tax abatements, then it's not a 

23           very good business plan.

24                  MR. KINK:  The other thing is -- 


 1                  SENATOR RYAN:  So where should we -- 

 2           I'm sorry.

 3                  MR. KINK:  I think it's fair to look 

 4           at the fact that some of these things are 

 5           done to generate headlines.  And that's a 

 6           real problem.  It is a problem for members 

 7           from all over the state, it's a problem for 

 8           governors from both parties.  

 9                  You know, you're paying for a 

10           ribbon-cutting that gets you a short-term 

11           headline rather than the long-term investment 

12           in people and communities that really pays 

13           off.

14                  That's a real thing, and I think 

15           that's an important part of the problem, the 

16           message.  

17                  SENATOR RYAN:  Yeah.  So where should 

18           we be, you know, putting our resources?  I 

19           read somewhere -- I don't know if this is all 

20           accurate, but that for every dollar we put 

21           into SUNY or CUNY we get about $8 back?  

22                  MR. KINK:  Yes.

23                  SENATOR RYAN:  Every dollar we put 

24           into economic development, we lose about 


 1           50 cents.

 2                  (Laughter.)

 3                  SENATOR RYAN:  Is that right?

 4                  MR. DEUTSCH:  Yeah, you know, I think 

 5           the return on investment for things like 

 6           higher education, for childcare, for home 

 7           care, these are all things that are necessary 

 8           in our society and actually create jobs, 

 9           create investment, create income, provide 

10           businesses with the things they need, a 

11           skilled workforce.  With childcare -- and 

12           childcare for their workers, who need 

13           childcare to get to work.  

14                  So I think we just -- it's been a 

15           systemic problem for decades now, in how we 

16           look at economic development in New York.  We 

17           really need to not be timid anymore and 

18           continue this notion of, you know, just 

19           because we keep doing the same thing over and 

20           over again, it does not make it right and 

21           just.  Right?  We need to rethink this, and 

22           we need a real paradigm shift here in the way 

23           we think about economic development.  Because 

24           what we're doing, quite frankly, is not 


 1           working.  

 2                  SENATOR RYAN:  My time is expiring, 

 3           but I thank you, you know, for your work and 

 4           research and your facts on the subject.

 5                  CHAIRWOMAN KRUEGER:  Thank you.

 6                  Assemblymember.  

 7                  CHAIRWOMAN WEINSTEIN:  Assemblyman 

 8           Bronson.

 9                  ASSEMBLYMAN BRONSON:  Thank you.

10                  So we've known that there has been 

11           inequities and disparities in our society for 

12           a long time.  COVID, however, brought that to 

13           light pretty significantly, whether you are 

14           talking healthcare or otherwise.  

15                  We I think are at a moment in time 

16           where having experienced the pandemic and 

17           seeing what happens to some of our families 

18           in our systems, and seeing the racial tension 

19           that exists in our streets, and reckoning 

20           with that, we're at a moment in time to look 

21           at our policy decisions, look at our funding 

22           decisions, to see if we're moving closer to 

23           equity.  Right?

24                  So my question -- I think you touched 


 1           on this through your narrative testimony in 

 2           answering Senator Ryan's questions.  Look, 

 3           you're asking for a transformative change in 

 4           approach to economic development.  And so 

 5           could you just wrap that around equity and 

 6           inclusion and fairness and, you know, expand 

 7           a little bit more on, you know, childcare, 

 8           education investments, investing in people 

 9           and communities versus investing in 

10           billionaires?  

11                  You know, this is for each of you to 

12           just take a little bit of time to just expand 

13           a little more on that.

14                  MR. DEUTSCH:  Yeah, I will say let's 

15           look at the facts.  Right?  If we look at 

16           Buffalo, Buffalo has received billions of 

17           dollars in economic incentives.  But -- and 

18           so has Rochester, so has now Syracuse.  

19           Right?  But what do they have in common?  

20           They have the highest child poverty rates in 

21           America, pretty much.  Right?  They're in the 

22           top 10 metro areas every year.

23                  So, you know, when we think about 

24           businesses locating in an area, we think 


 1           about quality-of-life issues.  We think 

 2           about, you know, access to a skilled labor 

 3           force.  So that's why I'm saying we need to 

 4           rethink how we approach this.  Right?  

 5                  If we want to do tax credits, we 

 6           should be doing credits like the earned 

 7           income tax credit and expanding that, the 

 8           child tax credit and expanding that.  Those 

 9           are tangible things that put money in 

10           people's hands who need it and create social 

11           mobility and economic mobility for the people 

12           who desperately need it.

13                  So the approach we have now is just a 

14           failed approach.  And, you know, we need to 

15           have the courage, quite frankly, to admit 

16           that and to move forward in a new way.

17                  MS. MARCELLO:  I would -- I appreciate 

18           the question.  And I would also add that not 

19           only do business subsidies not work to create 

20           and grow jobs, but they also contribute to 

21           increased inequality in communities.  So I 

22           really appreciate you bringing this up.

23                  MR. KINK:  The fact that there's no 

24           concentrated attention to that is the biggest 


 1           problem.  I can go on -- my time is out 

 2           here -- but the recent federal stimulus money 

 3           gave us a real opportunity to use money to do 

 4           that, to coordinate state and local funding, 

 5           to target the lowest-income communities and 

 6           communities that have been left out.  

 7                  There was a perfect opportunity to do 

 8           that if we had leaders at ESDC to help make 

 9           that happen.  We just don't.

10                  ASSEMBLYMAN BRONSON:  Thank you all 

11           very much.

12                  CHAIRWOMAN WEINSTEIN:  Thank you.

13                  Senate?

14                  CHAIRWOMAN KRUEGER:  Thank you.

15                  Senator Walczyk.

16                  SENATOR WALCZYK:  Thanks so much, 

17           Chairwoman.

18                  So ESD testified this morning and with 

19           a straight face said the film tax credit gets 

20           a nine-to-one return on investment for 

21           New York State taxpayers.  You say SUNY gets 

22           an eight-to-one return on investment.  

23           That's -- okay.

24                  GDP versus government spending.  I 


 1           would like to hear all three of your answers.  

 2           What is the right percentage for New Yorkers 

 3           to be spending compared to our GDP?  So how 

 4           much of a percentage of our GDP should we be 

 5           spending on overall state budgeting in order 

 6           to have a good economic growth outlook in 

 7           New York?  

 8                  MR. DEUTSCH:  You know, I don't have 

 9           that figure at my fingertips at this point, 

10           so I would ask to maybe answer that question 

11           later.

12                  MS. MARCELLO:  I apologize, I have a 

13           Ph.D. but it's in urban planning and not in 

14           economics, so I will yield the floor to 

15           Mr. Kink.

16                  MR. KINK:  You know, I've got the 

17           figures on this computer.  It might take me a 

18           second.  But I think we calculated two years 

19           ago, when we were in the pandemic crisis, 

20           that the percentage of government spending in 

21           New York, if we adjusted it to the percentage 

22           of government spending in Canada, that we 

23           could dramatically increase our investments 

24           by about $50 billion a year.


 1                  We could build housing to house every 

 2           homeless person.  We could have clean, 

 3           affordable energy for your constituents and 

 4           everyone else's.  We wouldn't be going to 

 5           like Soviet Russia-styles of confiscatory 

 6           taxation, we'd be about where Toronto and 

 7           Montreal are, where they offer adequate 

 8           healthcare to everybody, where people can 

 9           afford their medications.  

10                  That kind of society has stronger, 

11           more vibrant local economies.  There's not 

12           this dramatic division between the rich and 

13           the poor.  And there's a better day-to-day 

14           life for small businesses, for families, and 

15           everybody. 

16                  So I don't know if I'm up here -- I 

17           certainly will get it to you, Senator, the 

18           percentages.

19                  SENATOR WALCZYK:  Yeah, so -- 

20                  MR. KINK:  But that's about what we're 

21           talking about, the combination of national 

22           and provincial taxes in Canada versus the 

23           combination of federal and state taxes 

24           here in New York.  


 1                  SENATOR WALCZYK:  For purposes of this 

 2           conversation, I think Canada spends about 

 3           30 percent more than New York State by GDP in 

 4           total government spending.

 5                  MR. KINK:  Yeah.  So I would argue for 

 6           that level of increased investment in people 

 7           and communities.

 8                  SENATOR WALCZYK:  So you would say 

 9           over half of New York's GDP should be spent 

10           on government.

11                  MR. KINK:  No, 30 percent -- let me 

12           figure out the number.  I'll get it to you.  

13           I don't want to be inaccurate.

14                  SENATOR WALCZYK:  I can't imagine a 

15           New York that has a good economic outlook 

16           with that level of government spending.  But 

17           appreciate the feedback.

18                  MR. KINK:  Toronto and Montreal are 

19           doing pretty good.

20                  CHAIRWOMAN KRUEGER:  (Mic off, 

21           inaudible.)

22                  Next, Assembly.  No Assembly?

23                  Senator Murray.

24                  SENATOR MURRAY:  Thank you very much.  


 1                  And thank you for being here.

 2                  So I'm listening to you, and in 

 3           principle I agree with what you're saying, in 

 4           that we should not be providing incentives 

 5           and taxpayer money to those who really don't 

 6           need it, to the Buffalo Bills or to, you 

 7           know, major corporations.  I agree with you.

 8                  However, I do believe incentives can 

 9           help.  I believe we should refocus them, 

10           reimagine what we're doing with them, focus 

11           them more on smaller businesses that really 

12           do need the help.

13                  But I really would like to jump on 

14           what you said about childcare.  I think we 

15           should lead the nation.  I think we should be 

16           taking these incentives that we're giving in 

17           some forms, and moving it to incentivize 

18           childcare and work with us to maybe reduce 

19           some of the regulations, to streamline it, to 

20           increase that.

21                  We're battling against other states 

22           who do have IDAs, who do give out the same 

23           things.  So how do we balance that -- as was 

24           mentioned earlier, at the end of many of the 


 1           shows you see, the Georgia peach.  And, you 

 2           know, we're saying, Why aren't they here?  

 3           The reality is other states are giving out 

 4           these incentives.  How do we compete if we 

 5           don't?

 6                  MR. DEUTSCH:  Right.  Well, I would 

 7           suggest that not engaging in this race to the 

 8           bottom is a good start, right?  And I agree 

 9           with you that we need to start rethinking how 

10           we structure these deals, how we structure 

11           economic development in New York.

12                  But, you know, I think we're 

13           underinvesting, in a lot of ways, in a lot of 

14           programs that do in fact work and can make a 

15           difference.  So for instance, I've been up 

16           here, again, 30 times, right?  And one of the 

17           programs that I've been touting is the 

18           Entrepreneurial Assistance Program, which has 

19           been around since 1987 and it's been funded 

20           at about $1.7 million since then.  But it 

21           helps women and families of color create 

22           jobs, create businesses in their own 

23           communities.  And --

24                  SENATOR MURRAY:  Not to interrupt, is 


 1           that the one -- is that through SUNY?  

 2                  MR. DEUTSCH:  No, that's not through 

 3           SUNY.  It's a program operated through 

 4           Empire State Development.  

 5                  But it's one of those programs that, 

 6           again, is grossly underfunded, 

 7           underappreciated.  And it's got a great 

 8           return on investment, and it's creating 

 9           businesses throughout New York State.  

10           They're microbusinesses, right?  Less than 

11           five employees.  But still, businesses being 

12           created in New York State, creating 

13           opportunity.  A lot of those are home-based 

14           childcare businesses, for instance.  

15                  So obviously there's a need for 

16           childcare.  We should be looking at expanding 

17           programs like that as well.  

18                  So I think there's a lot we can do if 

19           we work together and reimagine this system 

20           rather than continuing to do everything that 

21           doesn't work.

22                  SENATOR MURRAY:  No, I agree with you 

23           on that.  

24                  And trying to piggyback on something 


 1           that Ms. Marcello said about businesses don't 

 2           hire because of incentives -- as a small 

 3           business owner, businesses hire because that 

 4           means they're succeeding.  If they're hiring, 

 5           they're growing.  If they're growing, they're 

 6           succeeding.  That's a good thing.  

 7                  We should help them to do this.  I 

 8           feel that we punish success here in New York 

 9           way too much.  But I agree with you, I think 

10           we should kind of reinvent the direction 

11           we're going.  But childcare should be top of 

12           the list.  

13                  Thank you.

14                  CHAIRWOMAN KRUEGER:  Thank you.  

15                  Assembly?

16                  CHAIRWOMAN WEINSTEIN:  No.

17                  CHAIRWOMAN KRUEGER:  No?  Just me.  

18           Thank you very much.  

19                  So we keep having this debate about 

20           what we're doing and investing in and what 

21           we're not investing in.  And one argument is 

22           that there's a much better use of that money.  

23           Another argument is that our taxes are just 

24           too high.  


 1                  So I'm curious, have any of you done 

 2           any research on other states that actually 

 3           show having a more even playing field with 

 4           not giving away so many tax abatements and 

 5           exemptions to certain kinds of businesses 

 6           results in a lower base tax for all the 

 7           businesses in the state that's actually an 

 8           advantage to that state?  

 9                  Because I feel like we're having this 

10           race to the bottom and that it's not working 

11           for us.

12                  MR. KINK:  Well, you know, I'll say 

13           I'm not suggesting that New York should move 

14           to the public policies of Florida and 

15           Alabama.  But in the press release and the 

16           study that was released yesterday about IDAs 

17           defunding local school districts -- in 

18           Florida and Alabama, you cannot give tax 

19           breaks that defund local schools.  That's not 

20           allowed.

21                  And so, you know, it certainly could 

22           be argued that Florida and Alabama have lower 

23           taxes than New York.  I don't think it's the 

24           right approach.  I think investing in great 


 1           public universities like SUNY and the 

 2           University of California, University of 

 3           Illinois, has paid off well for some of the 

 4           more progressive states over time.  

 5                  But, you know, if Florida and Alabama 

 6           can stop gutting local school districts with 

 7           giveaway tax breaks, maybe New York could 

 8           too.

 9                  CHAIRWOMAN KRUEGER:  Anyone else?  No?  

10           Okay.  That was really my question for you 

11           today.  Thank you.

12                  I think I was the last legislator.

13                  MR. KINK:  Can I give Senator Walczyk 

14           his number?  Is that okay?

15                  CHAIRWOMAN KRUEGER:  You can give him 

16           what, I'm sorry?

17                  MR. KINK:  His number?  He was looking 

18           for the percentage --

19                  CHAIRWOMAN KRUEGER:  Sure.

20                  MR. KINK:  So Canada does spend 

21           30 percent of GDP.  Here in New York, with 

22           the combination of federal, state, and local, 

23           we spend about 26.  So the recommendation 

24           would be to spend 4 percent more of GDP -- 


 1           it's about $70 billion -- and it would allow 

 2           those kinds of transformative investments in 

 3           local communities that could really make a 

 4           difference.

 5                  CHAIRWOMAN KRUEGER:  Thank you.

 6                  I'm not letting him have more time, 

 7           sorry.  Although he did bring me pretzels and 

 8           candy.

 9                  (Laughter.)

10                  CHAIRWOMAN KRUEGER:  In an attempt to 

11           bribe me for more time.

12                  But I want to thank you all very much 

13           for your attendance today.  Thank you.

14                  MR. KINK:  Thank you.  

15                  MR. DEUTSCH:  Thank you.  

16                  CHAIRWOMAN KRUEGER:  Next panel, John 

17           Scheib, from Scheib Associates, and 

18           David O'Rourke, CEO and president of New York 

19           Racing Association.

20                  I'm also just going to make the point 

21           that we in theory thought the Tax hearing 

22           would start at 2:00.  Clearly it's not going 

23           to.  But we're estimating probably a maximum 

24           of another hour.  My colleague is more 


 1           optimistic, a half-hour.

 2                  So don't go too far if you're here for 

 3           the Tax hearing.  But if you need to grab 

 4           something, you do have time to go and come 

 5           back.  Thank you.

 6                  Okay, good afternoon.  Whichever of 

 7           you would wish to start.

 8                  MR. SCHEIB:  Thank you for inviting 

 9           me.  I can provide sources for all of my 

10           testimony regarding the proposed $455 million 

11           state loan for Belmont Park.

12                  So what kind of destination are we 

13           building here?  If you use the past five-year 

14           averages, the new Belmont Park will now be 

15           the destination where more horses go to die 

16           than any other track in America.  And so it 

17           can be reasoned, then, that a 30-year loan 

18           will fund 1800 more dead horses just during 

19           the debt service period.  

20                  Horse racing isn't a public works 

21           project, it's a gambling business.  And our 

22           Constitution mandates that the betting on 

23           horses make a reasonable revenue for New York 

24           State.


 1                  New York didn't sign up for years of 

 2           completely unverified economic impact claims. 

 3           They demand wagering taxes.  Other forms of 

 4           gambling contribute billions every 12 months.  

 5           NYRA's wagering taxes round to zero, down 

 6           almost 80 percent in recent decades.  

 7           New York's 11 tracks combined pay only 

 8           $10 million in wagering taxes a year.

 9                  As a comparison, that's exactly the 

10           same amount racing paid 80 years ago in the 

11           middle of the Second World War, in 1942, with 

12           only five tracks.  

13                  It would take NYRA 83 years to remit 

14           what mobile sports betting paid just last 

15           year.  

16                  NYRA hasn't been profitable enough to 

17           pay its franchise fee to New York State in 

18           14 years.  Racing's handle numbers may sound 

19           impressive, but 80 percent of those bets are 

20           made from out of state -- where those states 

21           tax the wagering, not New York.

22                  And why on earth would New York loan 

23           money to build a luxury new track with such 

24           disastrous attendance?  Since 1978, Belmont 


 1           attendance is down 88 percent and Aqueduct 

 2           down an astounding 94 percent.  

 3                  NYRA's franchise ends in 10 years.  

 4           New York State's about to loan half a 

 5           billion, with no one signing up for the 

 6           second half of the debt service.  

 7                  Remember, job claims are just claims.  

 8           New York State agencies don't collect, and 

 9           more importantly they don't verify any data 

10           on racing's jobs or economic impact.  None.  

11           Why would New York support these type of jobs 

12           anyway?  We have 854 dead horses at Belmont 

13           and Aqueduct just since 2009.  

14                  On top of that, and importantly, right 

15           now in New York courts horse-doping crimes 

16           are responsible for the largest criminal 

17           sports indictments of any kind in the history 

18           of the United States.

19                  Is all this really what taxpayers want 

20           you legislators to spend their money on?  Are 

21           we proud of this mess?  If NYRA's seeking a 

22           loan, they should contact the Buffalo 

23           Bills -- apparently they have just come into 

24           a lot of cash recently.


 1                  Thank you.

 2                  CHAIRWOMAN KRUEGER:  Our next 

 3           testifier, please.  

 4                  MR. O'ROURKE:  To the chairs and 

 5           members of the Senate and Assembly 

 6           committees, thank you for allowing me to 

 7           testify today.  This is an honor.

 8                  My name is Dave O'Rourke, and I'm the 

 9           president and CEO of the New York Racing 

10           Association, which holds the exclusive 

11           franchise to conduct thoroughbred racing at 

12           Aqueduct, Belmont Park, and Saratoga Race 

13           Course.

14                  Across New York, horse racing is 

15           responsible for 19,000 jobs and more than 

16           $3 billion in annual economic impact that 

17           stretches to every corner of the state.  

18           New York thoroughbred racing is growing its 

19           fan base and is increasing in popularity, 

20           regularly setting new wagering records and 

21           dramatically expanding national television 

22           coverage of the sport.

23                  With that statewide reach in mind, I 

24           would like to focus my testimony on 


 1           Belmont Park.  Belmont has long been a crown 

 2           jewel in American horse racing, but it was 

 3           built over a century ago and has not been 

 4           renovated since 1968.  As a result, the venue 

 5           lacks amenities that fans expect.  It is not 

 6           ADA-compliant.  It is not environmentally 

 7           friendly.  And it is not, most importantly, 

 8           winterized, limiting Belmont's use to just a 

 9           few months each year.

10                  In response, NYRA has developed a plan 

11           to build a new, modern racing facility at 

12           Belmont to reimagine the experience for our 

13           fans while creating jobs and securing the 

14           future of the sport in New York.

15                  We are pleased that authorization for 

16           this project was included in Governor 

17           Hochul's budget proposal.  And according to 

18           an analysis by HR&A Advisors, this 

19           construction project alone will create 

20           $1 billion in economic activity, sustain 

21           3700 jobs, generate 45 million in tax 

22           revenues.  

23                  After construction, it will produce 

24           155 million in annual economic impact, 


 1           support 740 new full-time jobs, and generate 

 2           51 million in labor income and 10 million in 

 3           new tax revenue annually.  It will also allow 

 4           us to consolidate downstate racing, 

 5           relinquishing our interest in an 

 6           over-100-acre parcel of developable land at 

 7           Aqueduct Racetrack to the state which was 

 8           recently appraised at over $1 billion.

 9                  Unlike other development initiatives, 

10           this project comes at no cost to taxpayers.  

11           NYRA will pay back every dollar loaned by the 

12           state, plus interest.  These figures are 

13           immense, and while I know this is a budget 

14           hearing, these dollars and cents are just 

15           part of the story.

16                  Supporting a new Belmont also means 

17           supporting thousands of New Yorkers who rely 

18           on horse racing for their livelihoods, like 

19           the backstretch community of Belmont, who 

20           will benefit from the construction of new 

21           housing and upgraded facilities throughout 

22           the property.  

23                  Like the farmhands who work on nearly 

24           300 breeding farms that operate in almost 


 1           every county of the state, or the cleaning 

 2           staff and the servers at hotels and 

 3           restaurants in Saratoga Springs, or the 

 4           cooks, the carpenters, security guards, 

 5           tellers, and more at Belmont.  

 6                  That's why organized labor, small 

 7           family-owned farms, and leading business 

 8           groups, as well as 68 percent of New Yorkers, 

 9           support this economic development 

10           initiative -- because it delivers for 

11           New York families.

12                  I urge you to support the Governor's 

13           proposal and look forward to working with you 

14           during the budget and beyond.

15                  Thank you for your time.  I am ready 

16           to answer any questions.

17                  CHAIRWOMAN KRUEGER:  Thank you.

18                  I am the one Senator with questions.  

19                  So you want the state to guarantee the 

20           bonds.  What happens if we end our franchise 

21           with NYRA before you've paid us back?  

22                  MR. O'ROURKE:  So with this 

23           development, the land owns Belmont Park.  

24           These monies would be invested into 


 1           Belmont Park.  And it is an asset that stays, 

 2           in a business sense, within the balance sheet 

 3           of the state.

 4                  CHAIRWOMAN KRUEGER:  Well, we own the 

 5           land, so that's our asset regardless.

 6                  MR. O'ROURKE:  That's correct.

 7                  CHAIRWOMAN KRUEGER:  That we shouldn't 

 8           have to sell the land to pay back your bonds. 

 9                  So how would you pay us back?  

10                  MR. O'ROURKE:  Well, no, the actual 

11           asset would increase in value, Senator.

12                  CHAIRWOMAN KRUEGER:  Say that one more 

13           time?

14                  MR. O'ROURKE:  The actual asset would 

15           increase in value greatly.

16                  CHAIRWOMAN KRUEGER:  Only if someone 

17           else wants to take up the horse racing 

18           franchise, right?

19                  MR. O'ROURKE:  Well, it would also -- 

20           the actual building right now is 1.3 million 

21           square feet.  Part of the project is to 

22           create an incredible amount of green space.  

23                  One project going on right now at 

24           Belmont is to access the infield, which has 


 1           never been accessed, and that alone is 

 2           45 acres of green space, park-like land.

 3                  CHAIRWOMAN KRUEGER:  And you would 

 4           have to pay back -- I believe it was 

 5           26 million a year, is that correct?

 6                  MR. O'ROURKE:  That is correct, 

 7           Senator.

 8                  CHAIRWOMAN KRUEGER:  So -- and it's 

 9           from VLT revenue is that correct?

10                  MR. O'ROURKE:  From a specific stream 

11           of VLT revenue that is restricted for use on 

12           the state properties.  It's a capital -- 

13           cap-ex stream of VLT revenue, yes.  

14                  CHAIRWOMAN KRUEGER:  So how much is 

15           your annual income from that now?

16                  MR. O'ROURKE:  Approximately 

17           35 million.

18                  CHAIRWOMAN KRUEGER:  So what won't you 

19           be able to pay back anymore or pay for 

20           anymore because most of it will now be going 

21           to paying back bonds?  

22                  MR. O'ROURKE:  Well, our objective 

23           would be to accelerate the pay-back through a 

24           diversification of business lines that we've 


 1           been engaged in in the last five years.

 2                  CHAIRWOMAN KRUEGER:  Can you say that 

 3           to me one more time?  I don't think I 

 4           understood or heard.

 5                  MR. O'ROURKE:  Well, over the last 

 6           five years NYRA was a very specific -- had a 

 7           very specific business model historically, 

 8           where it was -- you ran the racetrack.  It 

 9           was very much brick and mortar, wagering at 

10           the track.

11                  Over the last five years we've 

12           expanded into television coverage, with 

13           almost 1,000 hours of media coverage, and the 

14           distribution of wagering.  The business model 

15           has completely changed.

16                  CHAIRWOMAN KRUEGER:  And some of your 

17           materials propose that you need to do this in 

18           order to get the Belmont Stakes at least once 

19           at Aqueduct.  

20                  Have you talked to anyone from the 

21           National Racing Association to know that this 

22           is actually going to happen?

23                  MR. O'ROURKE:  That's -- that would be 

24           the Breeder's Cup.  It would allow us to 


 1           actually monetize the Belmont Stakes to a 

 2           much higher degree.  But we would also be 

 3           able to bring the Breeder's Cup, which is in 

 4           a sense the horse -- the worldwide Super Bowl 

 5           of horse racing, to Belmont on a rotation, 

 6           which would be every four to five years.  

 7                  And yes, we have a commitment from 

 8           them to do that, absolutely.

 9                  CHAIRWOMAN KRUEGER:  And it's my 

10           understanding that horse-racing revenues are 

11           just going down, for a variety of reasons, 

12           nationally.  

13                  MR. O'ROURKE:  It depends --

14                  CHAIRWOMAN KRUEGER:  Is there any 

15           evidence that other states that have invested 

16           significantly in redoing their tracks have 

17           actually seen a growth in racing?

18                  MR. O'ROURKE:  There are.  There's an 

19           example in Virginia, Colonial Downs, which 

20           was reopened about five years ago.  

21                  And Churchill Downs, which has the 

22           first leg of the Triple Crown -- Belmont has 

23           the last.  And they are currently undergoing 

24           another project of $200 million investment in 


 1           that facility.

 2                  CHAIRWOMAN KRUEGER:  Thank you.  We're 

 3           out of time.

 4                  Assembly.  

 5                  CHAIRWOMAN WEINSTEIN:  We go to the 

 6           chair of our Racing Committee, Assemblyman 

 7           Pretlow, three minutes.

 8                  ASSEMBLYMAN PRETLOW:  Thank you, 

 9           Madam Chair.  

10                  And good afternoon, gentlemen.  Your 

11           testimonies sound like the yin and the yang.  

12           I don't know if you'd ever -- it is up or is 

13           it down?  

14                  I just have a couple of questions, and 

15           the Senator asked a couple of them, so I will 

16           be brief.  

17                  During the period of construction when 

18           operations move to Aqueduct Racetrack, will 

19           there be any loss of racing days?

20                  MR. O'ROURKE:  No, there will not.

21                  ASSEMBLYMAN PRETLOW:  So you'll 

22           maintain the same number of racing days.  

23                  And on average, how much does NYRA 

24           spend a year on capital improvements?


 1                  MR. O'ROURKE:  On average, 25 to 

 2           35 million.  A lot of that -- we've been 

 3           preparing for this, so we have been investing 

 4           heavily in the infrastructure and the housing 

 5           conditions specifically on the backside of 

 6           the operations.

 7                  ASSEMBLYMAN PRETLOW:  So the money 

 8           that's going to be used to pay back this loan 

 9           is about equal to what you've been spending 

10           on an annual basis to date, is that correct?

11                  MR. O'ROURKE:  That's correct.  But 

12           that would be with -- for instance, we 

13           currently operate 2 million square feet.  We 

14           will be going down to about half of that when 

15           this is complete.

16                  ASSEMBLYMAN PRETLOW:  All righty.  And 

17           NYRA is 100 percent confident that it can 

18           repay $25.8 million a year for the next 

19           20 years?

20                  MR. O'ROURKE:  Beyond that.  Yes, we 

21           are.

22                  ASSEMBLYMAN PRETLOW:  All righty.  

23                  Once Belmont's redevelopment is 

24           completed and racing concludes at Aqueduct, 


 1           how long do you anticipate until the state is 

 2           able to use the land that's now hosted by 

 3           Aqueduct for other purposes?  

 4                  MR. O'ROURKE:  Approximately three 

 5           years.  Some of the building could be used 

 6           before that.  Particularly, we just need the 

 7           racetrack itself.

 8                  ASSEMBLYMAN PRETLOW:  Okay.  Well, the 

 9           existing infrastructure has to be torn down.  

10           Would that be the state's responsibility or 

11           NYRA's responsibility?  

12                  MR. O'ROURKE:  The primary 

13           infrastructure at Aqueduct right now is 

14           literally attached to the Resorts World 

15           Casino.  So I -- that would not --

16                  ASSEMBLYMAN PRETLOW:  So there are no 

17           grandstands there now, it's --  

18                  MR. O'ROURKE:  The grandstand is the 

19           Resorts World Casino at the moment.  

20                  Where we operate out of is the 

21           clubhouse, which is a small section.

22                  ASSEMBLYMAN PRETLOW:  So you just have 

23           the clubhouse there.  Okay.  

24                  And how many acres will become 


 1           available for development?

 2                  MR. O'ROURKE:  Over 100.  

 3           Approximately 110.

 4                  ASSEMBLYMAN PRETLOW:  So 100 acres in 

 5           the middle of Queens -- 

 6                  MR. O'ROURKE:  Correct.

 7                  ASSEMBLYMAN PRETLOW:  -- close to the 

 8           airport will become available.  And the state 

 9           would have the ability to lease that land out 

10           or sell it for at least a minimum of a 

11           billion dollars, if my number's correct.

12                  MR. O'ROURKE:  Its value is a 

13           billion dollars.  I would imagine that it's a 

14           multiple of that, the potential.

15                  ASSEMBLYMAN PRETLOW:  All righty.  

16                  And right now, how many employees does 

17           Belmont have?

18                  MR. O'ROURKE:  We actually operate as 

19           a circuit, so we move -- we never operate two 

20           tracks at once.

21                  ASSEMBLYMAN PRETLOW:  Right.  So the 

22           employees that are at Belmont now will all 

23           work out of Aqueduct while the construction's 

24           going on at Belmont, and then they'll all 


 1           come back to Belmont after it's complete.  

 2                  So there's -- to your knowledge, there 

 3           will be no loss of jobs of individuals that 

 4           work at the existing racetracks now, is that 

 5           correct?

 6                  MR. O'ROURKE:  That is absolutely 

 7           correct.

 8                  ASSEMBLYMAN PRETLOW:  Okay.  Thank 

 9           you.

10                  CHAIRWOMAN KRUEGER:  Senator Murray 

11           jumped in.

12                  SENATOR MURRAY:  Just one quick 

13           question.  

14                  We've mentioned and we talked about 

15           the Buffalo Bills and what they got last 

16           year.  Is there a difference between what 

17           happened last year with that and what Belmont 

18           is getting?  And if so, what is the 

19           difference?

20                  MR. O'ROURKE:  I believe that was a 

21           grant, there were grants involved.  That's 

22           not -- that wasn't -- I can't attest to that, 

23           but I believe it was grants.

24                  This is a loan that literally we will 


 1           be paying back.  So in a sense, since the 

 2           state owns all these assets, you would think 

 3           of it as dividend yourself off the Aqueduct 

 4           property, invest $500 million to improve 

 5           Belmont.  And I think it's accreted from 

 6           day one.

 7                  SENATOR MURRAY:  And the loan is not 

 8           interest-free, correct?

 9                  MR. SCHEIB:  It is not, no.

10                  SENATOR MURRAY:  Okay.  Thank you very 

11           much.

12                  CHAIRWOMAN WEINSTEIN:  Assemblywoman 

13           Woerner.  

14                  ASSEMBLYWOMAN WOERNER:  Thank you, 

15           gentlemen.  

16                  So, you know, I represent Saratoga 

17           Springs, and my colleague reminded me that 

18           the Travers is actually the Super Bowl of 

19           racing.

20                  (Laughter.)

21                  ASSEMBLYWOMAN WOERNER:  But I have to 

22           say I experience what the economic impact of 

23           racing is, from the farms that grow the hay 

24           and the straw to the veterinary practices and 


 1           the farriers and the people who work on the 

 2           breeding farms and the agriculture industry 

 3           that is -- that is really what racing is all 

 4           about.  I see that, along with the tourism.

 5                  So I just have two questions for you. 

 6           One, what is the importance of having racing 

 7           throughout the year?  What's the importance 

 8           of the winter racing to support the equine 

 9           industry in the state?  

10                  And then, secondly, we do know that 

11           outside of Saratoga Springs that attendance 

12           is off at racetracks.  So could you reflect 

13           for a little while on what are the measures 

14           that you use to determine whether you are 

15           having a successful year or not.

16                  MR. O'ROURKE:  The second question I 

17           remembered; I can go back to the first, 

18           Assemblywoman Woerner.

19                  The second question would be the 

20           metrics used -- the sport has changed.   I 

21           mean, using 1978 -- actually I think that was 

22           the number mentioned earlier, I think that 

23           was the year Affirmed won the Triple Crown -- 

24           the sports business was a completely 


 1           different animal than it is today.  

 2                  Today it is about media distribution.  

 3           Experiences at the track have changed.  So we 

 4           need to actually bring the product that the 

 5           consumer wants.  And what they want are media 

 6           distribution in terms of television -- and 

 7           we've worked from 80 hours five years ago to 

 8           over 800 hours today, and that supports the 

 9           distribution of our wagering.

10                  Sports betting, the expansion of 

11           sports betting opens a massive opportunity 

12           and a massive customer base that dovetails 

13           with exactly what we've been doing in the 

14           racing industry for 100 years, almost.  

15                  And we measure ourselves on 

16           viewership.  We have 800 hours, we average 

17           50,000 to 100,000 people on a regular 

18           race day watching our program.  And then on 

19           the Belmont Stakes, if there's a 

20           Triple Crown, you're looking at close to 

21           20 million people, five million on a down 

22           year.  So these numbers are huge.

23                  We look at attendance.  You have to 

24           really look at audience and how they consume.  


 1           And it's different than it was 30, 40 years 

 2           ago.  

 3                  ASSEMBLYWOMAN WOERNER:  And winter 

 4           racing, how important is it to have, to be 

 5           able to race year-round?

 6                  MR. O'ROURKE:  It's extremely 

 7           important to specifically the breeding 

 8           industry in New York.  And New York breeds 

 9           some of the best racehorses in the country 

10           and in the world.  And to have a continuity 

11           of a racing circuit year-round that supports 

12           the New York bred, it's part of our core 

13           mission.

14                  ASSEMBLYWOMAN WOERNER:  And if we 

15           didn't have racing at the downstate tracks, 

16           if we didn't have racing at Belmont, which is 

17           currently crumbling, if we didn't have racing 

18           at Aqueduct, would the race meet at Saratoga 

19           be as successful?

20                  MR. O'ROURKE:  It would be quite 

21           different.  And that scenario would be likely 

22           catastrophic to the breeding industry in 

23           New York and the agri-aspect of what we do.

24                  ASSEMBLYWOMAN WOERNER:  Thank you very 


 1           much.

 2                  CHAIRWOMAN WEINSTEIN:  Thank you.  

 3                  We go to Assemblyman Ra for three 

 4           minutes. 

 5                  ASSEMBLYMAN RA:  Thank you.

 6                  Just wondering, Mr. O'Rourke, if you 

 7           could go just a little bit more into detail 

 8           about the impact both of construction and 

 9           afterwards of this.  So you said 3700 

10           construction-related jobs.  Union shops, 

11           correct?  

12                  MR. O'ROURKE:  Correct.  We have 

13           26 unions, I believe.

14                  ASSEMBLYMAN RA:  And $45 million in 

15           construction-related tax revenues.  I don't 

16           know if you happen to have a breakdown 

17           available in terms of whether town, county, 

18           state, of how that breaks out?

19                  MR. O'ROURKE:  We could supply that.  

20           I do not have that with me, though.

21                  ASSEMBLYMAN RA:  Okay.  Good.  That 

22           would be great.  

23                  And then the new full-time jobs.  So 

24           is that solely attributable to, you know, the 


 1           expansion and new areas that are going to 

 2           be -- you know, that the public is going to 

 3           be utilizing?  Or is that part of that, you 

 4           know, just people that would be moving over 

 5           that normally would work at those times of 

 6           year at Aqueduct?  How does that shake out?  

 7                  MR. O'ROURKE:  It's incremental.  

 8           Because these downstate facilities 

 9           specifically have very low utilization rates.  

10           Because they were built, really, on the 

11           concept of wagering, accepting, building.  So 

12           when you look at Belmont, it's almost like a 

13           very large warehouse for taking bets.

14                  Going forward -- and now we move as a 

15           circuit, so obviously during the summer we're 

16           in Saratoga.  But there's ancillary uses for 

17           Belmont.  It's actually quite a beautiful 

18           place.  So the planned project is to actually 

19           utilize that property year-round -- events, 

20           weddings.  And it just creates new forms of 

21           business lines, which equate to jobs.

22                  So I would believe that 740 number 

23           that I'm quoting is a conservative number.  I 

24           think we're going to be a lot higher than 


 1           that, because I think there's demand to be 

 2           outside.  And the amount of green space that 

 3           this will create is phenomenal.

 4                  ASSEMBLYMAN RA:  Sure.  And, you know, 

 5           as somebody who represents -- I don't quite 

 6           represent the track property, but I'm pretty 

 7           close by in Western Nassau, and I know I have 

 8           plenty of people who work in the industry 

 9           that are constituents of mine.  

10                  And I do think that, you know, the 

11           idea of having a world-class, modern racing 

12           facility to be on that site, in conjunction 

13           with obviously UBS Arena, is certainly, you 

14           know, a positive opportunity for year-round 

15           use for those types of events.

16                  But since you mentioned other types of 

17           events, I'm just going to throw a quick plug 

18           out there, because I think the greatest thing 

19           would be, if this gets done, to get an 

20           Islanders-Rangers winter classic there on the 

21           property, sell out the grandstand, have a 

22           great celebration of hockey for our 

23           two downstate teams, and watch the Islanders 

24           beat the Rangers.  Thank you.  


 1                  (Laughter.)

 2                  MR. O'ROURKE:  I couldn't agree with 

 3           you more on that one.

 4                  (Laughter; discussion off the record.)

 5                  CHAIRWOMAN KRUEGER:  Okay.  I believe 

 6           the Legislature is finished with our 

 7           questions for this panel.  Thank you very 

 8           much for being with us today.

 9                  MR. SCHEIB:  So no discussion about no 

10           attendance and no discussion about no tax 

11           revenue from a gaming business.

12                  CHAIRWOMAN KRUEGER:  Excuse me.  No, 

13           sorry.  Thank you.  Thank you very much.

14                  MR. SCHEIB:  Okay.

15                  MR. O'ROURKE:  Thank you.

16                  MR. SCHEIB:  Very productive, folks.

17                  CHAIRWOMAN KRUEGER:  Our next panel is 

18           actually going to be our last panel because 

19           No. 11 had to leave, so we are inviting 

20           No. 12, Stephanie Cunningham from Museum Hue, 

21           to join the panel with United Scenic Artists, 

22           Motion Picture Editors Guild, and Buffalo 

23           Niagara Film Office.  Because it's all the 

24           arts, we'll think about it that way.


 1                  So is Stephanie also here?  Oh, you're 

 2           Stephanie.  Okay.  And the two people with 

 3           you are not with you.

 4                  MS. CUNNINGHAM:  Yes, these are my 

 5           colleagues.

 6                  CHAIRWOMAN KRUEGER:  Oh, all three are 

 7           with you?  

 8                  MS. CUNNINGHAM:  Yes.

 9                  CHAIRWOMAN KRUEGER:  Okay.  Well then, 

10           let's -- as the others are coming down, we'll 

11           ask them to just sit in the front.

12                  And you have three minutes total for 

13           all three of you, so -- okay?  

14                  MS. CUNNINGHAM:  Yeah.  Perfect, thank 

15           you.

16                  So good afternoon, everyone.  My name 

17           is Stephanie Johnson Cunningham, and I'm the 

18           executive director of Museum Hue.  And I'm 

19           joined by my colleagues Sylvia Diaz and 

20           Martha Aeon.  

21                  So Museum Hue is an organization 

22           dedicated to the advancement of Black, 

23           Indigenous, and all people of color 

24           throughout the arts field.  We are a 


 1           membership- and community-based organization 

 2           collectively advocating for greater racial 

 3           equity in arts funding and offerings for arts 

 4           professionals of color through our Hue Arts 

 5           New York Initiative.

 6                  I join my colleagues working across 

 7           creative disciplines throughout the state in 

 8           thanking the committee for your leadership.

 9                  Arts and cultural workers are 

10           important to New York State's economy.  Arts 

11           and culture-related industries, also known as 

12           creative industries, provide direct economic 

13           benefits to the state and communities -- 

14           creating jobs, attracting investments, 

15           generating tax revenues, and stimulating 

16           local economies.

17                  In addition, because they enhance 

18           quality of life, the arts and culture are an 

19           important complement to community and 

20           economic development, enriching local 

21           amenities and attracting young professionals 

22           to an area.

23                  The arts play an essential role in 

24           creative and social lifeways across New York.  


 1           The art sector generates over 100 billion in 

 2           economic activity, according to the 

 3           Comptroller's report on the creative economy.  

 4           That is one in every $8 churning through the 

 5           city's economy.  It highlights the vastness 

 6           of the cultural sector, with over 400,000 

 7           jobs.  

 8                  Due to COVID-19, arts venues were 

 9           forced to close and cancel programs.  So in 

10           order for the vibrancy that is New York's 

11           arts and culture to be revived, we need the 

12           support of the New York state government.

13                  Black, Indigenous, and people of color 

14           arts organizations specifically have been 

15           disproportionately funded and impacted way 

16           before the COVID-19 pandemic.  Our arts and 

17           culture ecosystem needs vital funding to 

18           ensure survival.

19                  Museum Hue has identified over 500 of 

20           these arts entities, and we believe an 

21           implementation and deployment of a new 

22           $100 million funding model over five years 

23           will help accomplish the following 

24           objectives:  Re-grant equitable funding to 


 1           Black, Indigenous, Latinx, Asian, all people 

 2           of color arts entities across New York State.  

 3           Two, provide professional development to 

 4           strengthen these art entities.  Three, 

 5           advocate for city-state policies and 

 6           practices to provide support for these arts 

 7           entities.  And four, assist these arts 

 8           entities in gaining long-term space to 

 9           operate.

10                  As a lifelong New Yorker and arts 

11           professional, I know firsthand the impact of 

12           the arts field, especially the arts entities 

13           on communities of color.  They deserve a 

14           commitment to their survival from our 

15           government, our elected officials, 

16           communities, philanthropists, and businesses.  

17           They greatly contribute to the vibrant 

18           portrait of New York's cultural landscape, 

19           and these arts leaders have also proven to be 

20           resourceful and resilient in the face of a 

21           long history of chronic underinvestment and 

22           limited financial support.

23                  Thank you.

24                  CHAIRWOMAN KRUEGER:  Thank you.  Thank 


 1           you all.

 2                  Any questions?  Senator Ryan.

 3                  SENATOR RYAN:  Thanks for coming 

 4           today.  

 5                  Could you just take a few minutes and 

 6           tell us a little bit about your organization 

 7           or organizations that you represent?

 8                  MS. CUNNINGHAM:  Sure, absolutely.

 9                  So Museum Hue was founded in 2015, so 

10           it has been around for eight years now.  And 

11           its entire emphasis is dedicated to looking 

12           at the experience of Black, Indigenous, and 

13           people of color specifically working in the 

14           arts.

15                  And we have been able to fundraise a 

16           little over $1 million within the last year 

17           from the New York State Council of the Arts, 

18           Mellon Foundation, Ford Foundation, National 

19           Endowment for the Arts, New York Community 

20           Trust, all to support our research and data 

21           to collect information around the arts 

22           landscape and looking at the arts inequity 

23           funding throughout the state.

24                  CHAIRWOMAN KRUEGER:  Assembly.


 1                  CHAIRWOMAN WEINSTEIN:  Assemblywoman 

 2           Jackson.

 3                  ASSEMBLYWOMAN JACKSON:  Thank you for 

 4           your testimony.  

 5                  As a mom of an artist, you know, you 

 6           often hear, like, there is no money in art.  

 7           And what you are speaking to is what people 

 8           are talking about.  And so I am just 

 9           wondering what it is like for young Black and 

10           brown youth to get funding, government 

11           funding, government contracts relating to 

12           art.

13                  MS. CUNNINGHAM:  That is a good 

14           question.  We found with the research that we 

15           have collected so far, again, there are 

16           inequitable funding streams that is provided 

17           for individual artists of color and also 

18           institutions of color as well.

19                  And so we have found that within even 

20           NYSCA and New York City Department of 

21           Cultural Affairs, there is no real dedication 

22           to real data that kind of nails down how much 

23           the city and state give to arts organizations 

24           of color and individual artists of color.


 1                  ASSEMBLYWOMAN JACKSON:  Okay.  And do 

 2           you know if any of these individual artists 

 3           or groups, are they considered part of the 

 4           MWBE program?  Like, talk to me about that, 

 5           if you can.

 6                  MS. CUNNINGHAM:  Good question.  

 7                  So much of them that we found within 

 8           the 500 that I mentioned are not a part of 

 9           MWBE because they're not necessarily 

10           companies.  Most of them are 501(c)(3)s.  And 

11           the priority of MWBE is not nonprofits.

12                  ASSEMBLYWOMAN JACKSON:  Thank you.

13                  Thank you, Chair. 

14                  CHAIRWOMAN KRUEGER:  Thank you.  

15                  Anyone else?

16                  Then we appreciate all three of you 

17           coming to be with us today and making your 

18           request and sharing your information.  Thank 

19           you very much.  

20                  MS. CUNNINGHAM:  Thank you.  

21                  CHAIRWOMAN KRUEGER:  And now we're 

22           going to call the last panel for this 

23           hearing.  And after this panel is completed, 

24           we're going to take a 15-minute break before 


 1           we start the second hearing.

 2                  So now I'm inviting United Scenic 

 3           Artists, Local USA 829, IATSE; the Motion 

 4           Pictures Editors Guild, Local 700, IATSE; and 

 5           the Buffalo Niagara Film Office.

 6                  Okay, why don't we start with my left, 

 7           your right, and go down the table. 

 8                  MS. MYERS:  Okay.  Good morning, 

 9           Chairwoman Krueger, Chairwoman Weinstein, and 

10           distinguished members of the Legislature.  

11                  My name is Jennifer Myers, and I am a 

12           field representative of the Motion Picture 

13           Editors Guild, IATSE Local 700, and I present 

14           this testimony today on behalf of both 

15           Local 700, which represents post-production 

16           professionals, and the Post New York 

17           Alliance, which represents over 

18           60 post-production facilities and individuals 

19           working in post-production.

20                  Thank you for your long-standing 

21           support for our sector, which is a critical 

22           component of the film and television 

23           ecosystem, and for this opportunity to 

24           provide testimony and support of the 


 1           Governor's proposal to enhance and extend the 

 2           Empire State Film Post Production Tax Credit.

 3                  Our credit is a $25 million 

 4           suballocation of the larger Empire State Film 

 5           Production Credit, which I have broken down 

 6           in my written remarks.  The success of this 

 7           program is unparalleled, with posts seeing 

 8           explosive growth since enactment of the 

 9           separate post-production incentive.  

10                  A little over a decade ago, New York 

11           had very little of the nation's editorial 

12           work, but we're now the second-largest venue 

13           for domestic post-production work, after 

14           California.

15                  The credit has even allowed New York 

16           to compete with Canada and the UK, with 

17           incentives of their own, and has even 

18           succeeded in repatriating jobs based in China 

19           and India.

20                  For context, Local 700 members in 

21           New York logged approximately 299,000 hours 

22           worked in 2011.  By comparison, our members 

23           will have recorded approximately 900,000 

24           hours worked in 2022.  This success 


 1           translates into serious economic activity.  

 2                  We can tentatively report that thanks 

 3           to the incentive, the post-production 

 4           ecosystem directly employs 14,000 people as 

 5           of 2022, which indirectly supports 15,000 

 6           more jobs, for 29,000 jobs in total.  

 7           Collectively, this represents $2.43 billion 

 8           in labor income and $7.24 billion in economic 

 9           output.  And in return, the post-production 

10           ecosystem generates approximately 

11           $156 million in annual tax revenues.

12                  As a practical matter, jobs in 

13           post-production are coveted career tracks.  

14           To be clear, anyone entering into picture, 

15           sound, music, editorial, VFX or animation 

16           work has entered into a world with great 

17           salaries and benefits and an opportunity to 

18           work with innovative technology.

19                  According to HR&A, post-production 

20           workers earn an average of $119,000, which is 

21           significantly higher than the average salary 

22           for all industries statewide.  We are 

23           constantly working with our public and 

24           private partners to build out a workforce 


 1           pipeline that reflects the diversity of 

 2           New York.

 3                  For example, Local 700 engages in 

 4           outreach to raise awareness of 

 5           post-production career paths among youth in 

 6           underrepresented communities.  For at least 

 7           five years we have invited Bronx Community 

 8           College students to Editors Guild seminars, 

 9           screenings, and networking events.  And in 

10           2022, we formalized that relationship by 

11           providing funding with member instructors who 

12           are post-production professionals at the top 

13           of their field to lead master classes for 

14           sophomores.

15                  These and other programs have 

16           emphasized creating opportunities for 

17           underrepresented communities and assist in 

18           diversifying the post-production workforce.

19                  In summation, post-production is an 

20           important economic development driver and a 

21           home for well paying careers -- and all film 

22           and television, regardless of production 

23           location --

24                  CHAIRWOMAN KRUEGER:  Your time is up.


 1                  MS. MYERS:  Thank you.

 2                  CHAIRWOMAN KRUEGER:  (Mic off; 

 3           inaudible.)

 4                  MS. MYERS:  Sorry.

 5                  MS. GOVAN:  Thank you, and good 

 6           afternoon --

 7                  CHAIRWOMAN KRUEGER:  Would you mind 

 8           moving a little closer, please?  

 9                  MS. GOVAN:  Good afternoon, Chairwoman 

10           Krueger, Chairwoman Weinstein, and 

11           distinguished members of the New York State 

12           Legislature.  My name is Deirdra Elizabeth 

13           Govan, and I am vice president of the 

14           United Scenic Artists Local 829.

15                  Local US 829 is a national labor union 

16           and creative community of designers, artists, 

17           and coordinators working across the 

18           entertainment industry.  And I am one of 

19           those members, as a costume designer and 

20           production designer by trade.

21                  I also present this testimony on 

22           behalf of the broader film production labor 

23           union community, which represents the vast 

24           majority of workers in the highly unionized 


 1           field of film and television.  We thank you 

 2           for your long-standing support for our 

 3           industry.

 4                  I would like to say I am the real 

 5           Made-in-New-York story.  Over the span of 

 6           25 years I stood along with so many of my 

 7           colleagues as we have worked from the ground 

 8           up at our respective artistic professions 

 9           building what is now our state's renowned, 

10           vibrant motion picture industry.

11                  The film and television tax credit has 

12           been extraordinarily successful, turning 

13           New York State into a national hub for film 

14           and television production.  Our success has 

15           spurred other jurisdictions, in particular 

16           Georgia and now, on our doorstep, New Jersey, 

17           to enact highly competitive tax incentive 

18           programs which contain many aspects included 

19           in Governor Hochul's Executive Budget 

20           proposal.

21                  It is important to understand the 

22           success of this program.  New York State has 

23           transformed itself from merely a place to do 

24           location shoots and then leave to becoming a 


 1           home for over 57,000 direct and indirect 

 2           workers annually, earning 12 billion in wages 

 3           per year.

 4                  For all of this, it is the tax credit 

 5           that has made the difference.  Numerous 

 6           states have recently matched and exceeded 

 7           New York's program, further exacerbating the 

 8           reasons why so many projects that once came 

 9           to New York now choose not to do so.  The new 

10           reality is best captured by the fact that for 

11           the first time in years, sound stages in New 

12           York are seeing significant vacancy rates.  

13                  It is also important to underscore 

14           that with the vast growth of New York's film 

15           and television industry, there has been a 

16           significant increase in diversity within its 

17           workforce.

18                  I have personally seen the 

19           diversification of the industry over the past 

20           25 years with increasing opportunities for 

21           black and indigenous people of color.  As the 

22           industry has created new jobs in New York, it 

23           has opened the door to all New Yorkers, with 

24           varied levels of education and experience, to 


 1           build a career and to support their families.

 2                  Our unions are heavily invested in 

 3           developing programs that offer opportunities 

 4           to diversify their talent pools and 

 5           memberships.  For example, IATSE Local 52 

 6           Motion Picture Sound Studio Mechanics is 

 7           working with Bronx Community College to 

 8           develop a talent pipeline.  

 9                  My own union continues to provide 

10           access to emerging artists.  For example, 

11           New York State's Scenic Artists Apprentice 

12           Program currently has the most diverse group 

13           of new workers this program has ever offered.  

14           This incentive is driving a new generation of 

15           artists to seek out professional 

16           opportunities and invest in our industry and 

17           talents.

18                  CHAIRWOMAN KRUEGER:  Thank you.  Sorry 

19           to cut you off there.

20                  MS. GOVAN:  I thank you for your time.

21                  CHAIRWOMAN KRUEGER:  Thank you.

22                  Our last panelist.  

23                  MR. CLARK:  Ready?

24                  CHAIRWOMAN KRUEGER:  Yes.


 1                  MR. CLARK:  Senator Krueger, 

 2           Assemblymember Weinstein, Senator Ryan, from 

 3           my neck of the woods, I travelled from 

 4           Buffalo today to attest about the economic 

 5           impact of this New York State film tax credit 

 6           program and what it's had on Western 

 7           New York.

 8                  I think I can provide a pretty unique 

 9           perspective as film commissioner in a region 

10           that was never a traditional production 

11           center, but also as the immediate past chair 

12           of the Association of Film Commissioners 

13           International, a group that allows me to 

14           interact routinely with colleagues around the 

15           world.

16                  Film tax incentives absolutely drive 

17           where movies and scripted TV shows are made. 

18           I hear that from both foreign and domestic 

19           film commissioners, studio executives, as 

20           well as independent filmmakers.  The states 

21           and territories without incentives are always 

22           ruled out when making decisions on where to 

23           shoot.  

24                  In fact, before a competitive tax 


 1           incentive was instituted here in New York, 

 2           movies that were set in Buffalo were shot in 

 3           places like Winnipeg, Manitoba; Toronto, 

 4           Ontario; and Southern California.  Now, 

 5           Buffalo has doubled for cities such as 

 6           Los Angeles; Hartford, Connecticut; 

 7           Clarksdale, Mississippi; and even 

 8           Martha's Vineyard.  I would say that is an 

 9           amazing reversal of fortune for our town.

10                  We are now a movie-making destination, 

11           something even I never envisioned when I 

12           became film commissioner some 17 years ago.  

13           Motion picture production has become an 

14           important component of our new sector economy 

15           in Western New York.  Hundreds of good-paying 

16           jobs have been created.  New sound stages and 

17           movie-related businesses continue to pop up 

18           all over our region, and a prideful community 

19           has been able to see our town, our cities, 

20           our villages shown worldwide on the silver 

21           screen and beyond.

22                  Motion picture union ranks have 

23           exploded their membership numbers.  When I 

24           first started my job, there were about a 


 1           dozen members of IATSE -- that's the movie 

 2           mechanics union.  Now there are nearly 200 in 

 3           Buffalo.  Go figure, right?

 4                  The Theatrical Teamsters Local 817 

 5           have partnered with the Teamsters Local in 

 6           Buffalo to provide dozens of drivers for the 

 7           many movie trucks that now dot our landscape.  

 8           The Screen Actors Guild, the Directors Guild, 

 9           the Producers Guild -- they're all in Buffalo 

10           now.  They have increased their numbers 

11           dramatically in our region.

12                  While there are some tweaks -- and I 

13           must say there should be some that need to be 

14           made for upstate areas -- the New York State 

15           film tax credit is making a solid and 

16           long-lasting impact from Long Island all the 

17           way to Lackawanna.

18                  I would like to thank all of you, on 

19           behalf of the thousands of Western 

20           New Yorkers that have been positively 

21           affected by this new industry, for your 

22           continued support in strengthening our 

23           economy in Buffalo through the state's film 

24           tax credit program.  


 1                  It has been a real distinct privilege 

 2           and honor to be here today to let you know 

 3           just what a difference all of you have made, 

 4           as Hollywood continues to take notice of 

 5           every single part of this great, of this 

 6           diverse, and of this unique place that we 

 7           call the State of New York -- the family of 

 8           New York.

 9                  Thank you.

10                  CHAIRWOMAN KRUEGER:  I'm sorry.  First 

11           up, Senator Sean Ryan.

12                  SENATOR RYAN:  Thanks, everyone, for 

13           coming today.  Thank you to the folks from 

14           IATSE.  And thanks, Tim, for coming up the 

15           Thruway this morning.  I tried to 

16           accommodate, get you in earlier, but we set a 

17           pretty tight schedule.

18                  MR. CLARK:  I understand.

19                  SENATOR RYAN:  So I have a few 

20           questions.  

21                  I know I've visited some of the 

22           downstate sets.  And walking around, I saw 

23           IATSE members, carpenters -- it almost 

24           seemed, you know, close to wall-to-wall 


 1           people with, you know, workforce democracy.  

 2                  Is that implicit in the statute, in -- 

 3           when we come out of New York City, are the 

 4           productions in Buffalo, are they the same way 

 5           in terms of unionization?

 6                  MR. CLARK:  In Buffalo, yes, Senator.  

 7           In fact, there has been this proliferation of 

 8           IATSE members that have grown there.  And 

 9           it's all really different departments.  

10           Scenics is certainly one of them, and so many 

11           others.  

12                  And we have been really targeting 

13           workforce development to really provide a 

14           good diverse workforce base in Western 

15           New York so when the studios come, or when 

16           the independent filmmakers come, they feel 

17           very -- you know, it's not a big difference 

18           from being in New York or in the Mid-Hudson 

19           region or places closer to New York.  

20                  So we've been very successful, and 

21           it's been really great.

22                  SENATOR RYAN:  So before this film 

23           credit started, you saw very little film 

24           production in the Buffalo area -- 


 1                  MR. CLARK:  Almost nothing, yeah.

 2                  SENATOR RYAN:  You would see it in 

 3           Toronto, which would often masquerade as 

 4           other cities.

 5                  MR. CLARK:  Right.

 6                  SENATOR RYAN:  And how much has it 

 7           come into our area of Western New York?  And 

 8           is that coming at the expense of films or 

 9           studio work that would have been done in 

10           New York City?

11                  MR. CLARK:  Well, we've lost some 

12           things.  And I have to tell you, I think this 

13           new proposal is looking really good.  

14                  I can tell you "The Bros," that Warner 

15           Brothers movie -- I think it was Warner 

16           Brothers, they -- or no, I'm sorry, it was 

17           Universal.  They ended up in New Jersey.  

18                  We had another movie that scouted a 

19           pretty good-size movie that ended up in Ohio.  

20           And it really was taken there by these higher 

21           incentives and, you know, the inducements 

22           that these other states have had.  So we've 

23           lost some things.

24                  But, you know, as you know all too 


 1           well, our architectural assets in Western New 

 2           York are some of the finest, and I think the 

 3           creative side of the movie industry seems to 

 4           notice that.  When you get the business side, 

 5           the incentive folks agreeing that -- with the 

 6           creative people, it's a recipe for success.  

 7           And that's what we've had here in Western 

 8           New York.

 9                  SENATOR RYAN:  This idea of the 25 to 

10           30 percent, and it's also mixed in with this 

11           above-the-line and below-the-line -- could 

12           you explain to me the differences on that?

13                  MR. CLARK:  Well, I can again 

14           anecdotally point to a situation we had with 

15           a movie called "White Noise," I think it was.  

16           They came in at that 25 percent, and they 

17           just couldn't make it work, they just 

18           couldn't.  So they ended up in Ohio.

19                  SENATOR RYAN:  Thank you.

20                  CHAIRWOMAN KRUEGER:  Thank you. 

21                  Assembly.

22                  CHAIRWOMAN WEINSTEIN:  Assemblywoman 

23           Woerner.

24                  ASSEMBLYWOMAN WOERNER:  Thank you.


 1                  Ms. Govan, in your testimony, in your 

 2           written testimony, you say that the state's 

 3           exceeded its allocation faster than 

 4           anticipated, and the consequence of that is 

 5           that productions are having to wait a period 

 6           of time after the production concludes to 

 7           claim their credits.  And that that delay is 

 8           a reason that states look for -- or the 

 9           productions look to other states rather than 

10           stay in New York.

11                  Can you give us some sense of how long 

12           that delay is or how much we have exceeded 

13           our allocated credits on an annual basis?

14                  MS. GOVAN:  Thank you, Assemblywoman 

15           Woerner.

16                  To my understanding and research, it's 

17           usually anywhere between one to three years 

18           after they finish production.  

19                  ASSEMBLYWOMAN WOERNER:  And that's not 

20           true in other states?  

21                  MS. GOVAN:  I can't quote on those 

22           statistics.  But what we have on data is for 

23           our state, that is the time.

24                  ASSEMBLYWOMAN WOERNER:  Okay.  Do you 


 1           have any sense of what the backlog is of -- 

 2           in terms of number of productions that are 

 3           awaiting their credits?

 4                  MS. GOVAN:  What I do understand, 

 5           Assemblywoman Woerner, is that there is a 

 6           rollover period.  So once that 430 million is 

 7           exhausted, there's a rollover period going 

 8           into that next round, and it's also 

 9           exhausting that.  So it's a continuation of 

10           rolling over, never catching up.  So we are 

11           consistently behind.

12                  ASSEMBLYWOMAN WOERNER:  Okay.  Thank 

13           you.

14                  And I would just say that as a 

15           designer, could you please come up with 

16           something that's better than the peach for 

17           us?  

18                  (Laughter.)

19                  ASSEMBLYWOMAN WOERNER:  Every time I 

20           see that peach on the credits, I just -- it 

21           makes my teeth ache.

22                  Thank you.

23                  CHAIRWOMAN KRUEGER:  Senator Walczyk.

24                  SENATOR WALCZYK:  Thanks, Chairwoman.


 1                  So the Governor's invested, at least 

 2           in her budget proposal here, $700 million in 

 3           post-production tax credits.  It's a 

 4           $280 million increase over last year, which 

 5           is pretty significant.  

 6                  And budgets are about priorities.  At 

 7           the same time, she's borrowed $2.5 million, a 

 8           million-dollar cut over last year, but a 

 9           $2.5 million cut over previous years in local 

10           tourism matching grants.  

11                  Would your industry survive if you 

12           only had a $697.5 million post-production tax 

13           credit available at the end of all of these 

14           budget negotiations?

15                  MR. CLARK:  Me?  I would say the 

16           problem that has -- and this is my reference 

17           to a little tweaking upstate -- is that a lot 

18           of these -- a lot of these incentives get 

19           gobbled up pretty quickly down in the city, 

20           down in New York City.  

21                  And so we often hear from -- and 

22           sometimes we get a little lower budget 

23           independent films that come through, and 

24           those folks are waiting two, three -- I've 


 1           heard even longer.  And if they're -- they're 

 2           seeing those kinds of wait times, they're 

 3           going to New Jersey.

 4                  And we just -- there's a guy whose 

 5           wife is from Buffalo -- again, this is 

 6           anecdotal -- but he's vowed to not return.  

 7           He's kind of shifted everything to 

 8           New Jersey, you know, and he says that he'll 

 9           come back if the wait time ends.

10                  So we predict -- or at least I think 

11           that this higher cap might -- you know, 

12           according that a little bit in a way that 

13           makes it that that money comes back quicker.  

14           We're hoping that's the case.  

15                  The other thing, too, is the 

16           above-the-line.  I mean, I'll tell you, we 

17           lose a lot of movies, you know, to states 

18           that have above-the-line, and New Jersey in 

19           particular.  And that's troubling, you know, 

20           because they set themselves in New York but 

21           then end up shooting in New Jersey.

22                  SENATOR WALCZYK:  But if we were to 

23           just restore for the counties that depend on 

24           those tourism dollars the local matching 


 1           grant program, could you survive without the 

 2           $2.5 million?

 3                  MR. CLARK:  Well, we don't do that, I 

 4           don't believe, in Buffalo.  I think there's 

 5           some sort of matching grant thing up in 

 6           Syracuse, but I'm not aware of anything in 

 7           Buffalo.  That's -- that's not something I 

 8           know about.

 9                  SENATOR WALCZYK:  There's tourism 

10           agencies across New York State that avail 

11           themselves of this.  It's local advertising 

12           dollars that really have compounding 

13           interests when they're applied.  So we get it 

14           back in sales tax and bed tax and all of the 

15           different ways that tourism is great.

16                  Well, I appreciate it.

17                  MR. CLARK:  Yes.

18                  SENATOR WALCZYK:  I think I've made my 

19           point for the record, that I think this 

20           group -- while, you know, I appreciate the 

21           Governor wanting to invest in post-production 

22           tax credits, I think they'd do just fine with 

23           697.5 million rather than 700.

24                  Thanks for your time.


 1                  MR. CLARK:  Thank you.

 2                  CHAIRWOMAN KRUEGER:  Assembly?  

 3                  CHAIRWOMAN WEINSTEIN:  Assemblyman 

 4           Otis.

 5                  ASSEMBLYMAN OTIS:  I have a question 

 6           for Tim Clark.

 7                  MR. CLARK:  Sure.

 8                  ASSEMBLYMAN OTIS:  My wife is from 

 9           Buffalo.  So we were watching a 2007 film the 

10           other day that partially took place in 

11           Buffalo.  And for authenticity, she's 

12           looking, but we found out, we looked it up, 

13           it was filmed in Winnipeg, as you testified.

14                  MR. CLARK:  Yes.  Yes.

15                  ASSEMBLYMAN OTIS:  So the fact that 

16           we're doing things to bring these filmings 

17           back to authentic locations like Buffalo is a 

18           great thing.

19                  MR. CLARK:  Well, thank you, 

20           Assemblymember.  And I -- it's always irked 

21           me for years, you know, especially as a guy 

22           charged with the responsibility of bringing 

23           movies to Buffalo, when I'm watching movies 

24           that are set there but not shot there.  


 1                  So -- and, you know, there is this 

 2           component of community pride, too, that I 

 3           think people from Buffalo -- and I'm sure 

 4           your wife would attest to this -- they know 

 5           the difference.  And Winnipeg ain't Buffalo.

 6                  (Laughter.)

 7                  ASSEMBLYMAN OTIS:  Thank you very 

 8           much.  Thank you all.

 9                  MR. CLARK:  Thank you.

10                  CHAIRWOMAN KRUEGER:  Thank you.  

11                  I think I'm last.  Well, do you have 

12           more?

13                  CHAIRWOMAN WEINSTEIN:  No.

14                  CHAIRWOMAN KRUEGER:  Okay.  So 

15           following up on the growth in the tax credit 

16           proposed by the Governor, at least in earlier 

17           years there seemed to be agreement with your 

18           unions that these credits should only go 

19           towards the workers on movies who were below 

20           the -- what are they called, the line.

21                  MR. CLARK:  Below the line, yes.

22                  CHAIRWOMAN KRUEGER:  And now they're 

23           talking about the directors, the movie stars, 

24           people who don't live here in New York 


 1           getting credits -- for jobs that pay up to 

 2           $500,000.  

 3                  I would much rather see a commitment 

 4           by these companies to actually have to move 

 5           to New York and be here with us full-time, 

 6           and even make sure that they are filming and 

 7           producing things that take place in New York, 

 8           and encourage tourism -- following up on my 

 9           colleague's point that we want people to come 

10           to New York, so we want them to watch movies 

11           and TV that highlight all the things that are 

12           so unique about our state.  And that those 

13           should be given points, so to speak, when the 

14           storylines are New York-based.  

15                  And I'm just curious what anybody 

16           thinks about these changes by the Governor.  

17           Because it's not just new money being 

18           proposed, it's new money for a different 

19           universe.

20                  MS. MYERS:  I'll take that.  

21                  I think it's a multipronged approach. 

22           And what I mean is many actors above-the-line 

23           are also New York residents.  They live here.  

24           So most of the times when productions are 


 1           coming here and they're interested in being 

 2           in New York, those actors who are a part of 

 3           that production, they look for the 

 4           convenience.  They look for the ability to be 

 5           able to see their families, to be able to go 

 6           home at the end of a long shoot day.  

 7                  So I don't necessarily feel that it is 

 8           something that's not needed.  I do feel that 

 9           it's a one-to-one comparison with what our 

10           competitors are doing.  And that is 

11           New Jersey and Georgia, which have the same 

12           incentive that is proposed in 

13           Governor Hochul's budget.

14                  CHAIRWOMAN KRUEGER:  So I have some 

15           famous actors living in my district in 

16           Manhattan.  I suspect they'd get hired 

17           anyway.  Like, they're big famous people.  

18                  So I just don't see why we should 

19           actually be giving up our tax revenues for, 

20           with all respect, them.  They've been working 

21           and doing very well in their careers up to 

22           now.  And I just don't quite see that this 

23           changes the story.  It just moves more of our 

24           money into subsidizing an industry that 


 1           doesn't always need that much subsidizing.

 2                  MS. MYERS:  Well, I can't really speak 

 3           to that, Senator.  But what I can speak to is 

 4           the below-the-line experience and having 

 5           productions relocate.  As a working costume 

 6           designer and officer of a union, I recently 

 7           experienced that.  The production decided to 

 8           relocate to Georgia, and in relocating to 

 9           Georgia, I lost a job.  So -- purely based 

10           upon the fact that they did not want to pay 

11           the accommodation fee for that.  So it really 

12           wasn't about talent, it was about the money.  

13                  And so I personally feel keeping the 

14           tax incentive and doing a one-to-one or a 

15           comparison with what other states are doing, 

16           is necessary to keep production here as a 

17           whole.

18                  CHAIRWOMAN KRUEGER:  My time is up.  

19           Thank you very much.

20                  MS. MYERS:  Thank you.

21                  CHAIRWOMAN KRUEGER:  Assembly?

22                  CHAIRWOMAN WEINSTEIN:  No.

23                  CHAIRWOMAN KRUEGER:  Any other 

24           Senators?


 1                  Well, then I'm going to thank you very 

 2           much for being with us today -- 

 3                  MR. CLARK:  Thank you.

 4                  CHAIRWOMAN KRUEGER:  -- for being our 

 5           last panel on this hearing.  

 6                  MS. GOVAN:  Thank you.  

 7                  MS. MYERS:  Thank you.  

 8                  CHAIRWOMAN KRUEGER:  And I'm going to 

 9           declare that this hearing is done.  

10                  We're going to take a 15-minute 

11           break -- around a 13-minute break.  At 3:15, 

12           we will return here for the Tax Hearing.

13                  Thank you, everyone.

14                  (Whereupon, the budget hearing 

15           concluded at 3:02 p.m.)