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 State, Provincial and International Reviews 
Friday, December 04 2015
Rebuilding the Upstate Economy

By Governor Andrew M. Cuomo

For many years, Upstate New York was treated like a second-class citizen, forced to watch Downstate thrive as the Upstate economy dwindled. Upstate was literally losing population and jobs - and maybe most importantly, it was losing hope. Much of this was a function of the changing economy, which shifted manufacturing to overseas. Also, some people left Upstate New York for warmer climates in what has become a more mobile society. But, it is just as true that the New York state's policies contributed to the decline and the state did little to assist in Upstate's transition to a new economy.

Four years ago we embarked on what many considered was a fool's errand, trying to rebuild the Upstate economy. When I first announced our plans, the media and our citizens viewed the intention and possibility cynically. We carried on nonetheless. Today, any objective source would admit significant progress has been made. Even the skeptics are startled.

We started on the toughest economic terrain, Buffalo. Today, evidence of a Buffalo renaissance is irrefutable. Just weeks ago, the Buffalo News Editorial Board said, "While Buffalonians have never been accused of being wildly optimistic, especially since the end of the heyday of Bethlehem Steel, even the most jaded has to admit change is in the air."

Rochester's future is lighting up with advancements in the photonics industry. According to The Democrat & Chronicle, "economic development officials and insiders are bordering on euphoric."

Utica scored a big win in attracting nanotechnology companies and securing 2,500 high-paying jobs. One of the companies moving to Utica is General Electric. GE had left Utica decades before, leaving for greener economic pastures. The company'e exit was devastating to Utica. Now GE is coming home to Utica, and bringing 500 new jobs. It is a perfect metaphor for Upstate's rebirth.

This progress did not come easily or inexpensively, nor is the economic trajectory certain or uniform; regional performance varies. Most notably, the Southern Tier is still lagging. There is no reason to rest on our laurels. We have worked tirelessly and invested millions for the progress we have achieved thus far. Our efforts were strategic and informed. I spent eight years in Washington heading the Department of Housing and Urban Development, seeing what worked and what did not, and we brought the best examples of success to New York State. 

We have dramatically reduced state taxes. We've reduced income taxes, corporate taxes and manufacturing taxes to the lowest level in decades. We also controlled the growth of the tax that is most oppressive to Upstate New York – the property tax – with our property tax cap, while we aggressively promoted government consolidation and efficiency.

We invested state funds in building sustainable, regional, private sector economies, rather than the past practice of spending funds to slow the inevitable insolvency of failing governments that were losing their tax base. Our strategy is to build jobs, build businesses, keep our young people, attract newcomers and create a tax base that will allow local government to be sustainable. 

We stopped the Albany-based, top-down political decision making and invested in job growth by decentralizing decision making from Albany to the ten distinct economic regions in the state; and, we engaged the local elected, business and academic leadership in designing plans for their region.

We injected a statewide competition into the allocation of our economic resources. This was new and controversial – local governments and regions didn't want to have to compete for funds; they wanted a state allocation handed to them. I fully understand their feeling, but I disagree. 

Government, unlike the private sector, has few performance benchmarks. I believe competition increases the level of attention and accountability. The past four years have seen the state's ten regions compete against each other for resources. I have seen the competition work to increase the performance of all regions; the taxpayers are getting their money's worth and the regions have plans that are stronger with a greater chance of success. The competition also helped forge alliances within the region. One of the challenges is to get local business leaders, politicians and academic leaders to unify and develop a joint and cooperative plan rather than the usual jousting with each other for the economic crumbs generated by their regional economies. Infighting hinders economic progress dramatically. This spirit of competition with other regions actually provided a common goal that helped unify the local participants.

I firmly believe the state shortchanged Upstate New York for many years, and I believe it was shortsighted. When New York City had financial trouble in the 1970's, Upstate bailed it out -- because at the end of the day, we are one state, one community and one balance sheet. Now, we have modified the state's funding priorities and have invested billions in Upstate New York. From the Buffalo Billion to the Regional Economic Development Council competition to this year's $1.5 billion Upstate Revitalization Initiative, the state has invested more in Upstate New York than at any time since construction of the Erie Canal.

The regional applications for the state’s economic development competitions were submitted recently, after each region worked diligently developing and preparing their plans. As the state begins its review process, we’re looking for plans that incorporate these important components: 

  • There is no "build it and they will come" economic theory. We want actual and specific business agreements and transactions that will result in the creation of actual jobs.
  • Business development plans are best when focused on synergistic economic clusters. 
  • This is not a political ("small p") process. The regions are devising a business plan, not a Christmas wish list. "Spreading out the funding" so that everyone gets something is not an economic strategy.
  • "No copycat economic blueprints." What works for one region may not necessarily work for another region. For example, Buffalo's success cannot be duplicated by copying Buffalo's plan. What made the Buffalo plan successful was that it was custom-designed, building on Buffalo's assets.
  • "Swing for the fences." Start by looking for a business opportunity that would make the region competitive not just statewide, but nationally or internationally. 
  • The competition calls for "regional" plans - provide them. We understand the economic engine of a central city, but we also understand that the economy has to work for the entire region and the plans that address the region comprehensively are the most competitive.
  • Consult everyone, including all elected officials, and forge consensus within the community and region.
  • Develop a plan that can be implemented even if you don't win the competition.
  • Get the community excited – only communities that believe they have a future actually have a future. 
  • Plans are not dreams. These plans must be detailed blueprints that are feasible and capable of implementation with identifiable timelines. 

The Upstate Revitalization Initiative and Regional Council competitions are major opportunities to extend the growth of Upstate New York. One thing is certain: we have proven that there is no reason for despair in Upstate New York. Communities that are committed, unified, and capably led can achieve remarkable progress relatively quickly. I understand the roots of the economic distress of Upstate New York. There have been decades of decline and a parade of politicians promising help that never materialized. It's hard to believe in the future again after so much disappointment. On the other hand, the evidence of rebirth is overwhelming and economic optimism is necessary to make revitalization possible. I believe in Upstate New York and, more importantly, Upstate New Yorkers should believe too, because the best is yet to be.

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Posted by: AT 10:31 am   |  Permalink   |  Email
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