Empire State Development Aims Ever Upward for NY State Businesses

Gene Marks (00:00 to 00:40)

So, the State Small Business credit initiative, I kind of want to zero in on this a little bit. It's a federal initiative. It's actually a COVID initiative, right? I mean, it was authorized during it to support small businesses. And then the federal government being the federal government, it took them forever to get the money out there, but now it's coming.

And then the federal government being the federal government, it took them forever to get the money out there, but now it's coming. So, ultimately, there could be as much as $5 billion available to help small businesses. Now, my business is not in New York state, but if I were, my first question to you would be like, wow, that's a lot of money. How do I get my hands on some of that money?

Announcer (00:43 to 00:59)

Welcome to Paychex THRIVE, a Business Podcast where you'll hear timely insights to help you navigate marketplace dynamics and propel your business forward. Here's your host, Gene Marks.

Gene Marks (01:00 to 01:20]

Hey, everybody, it's Gene Marks. And welcome back to another episode of the Paychex THRIVE podcast. Thank you so much for joining us. This week my guest is Hope Knight. Hope is the president, CEO, and commissioner of the Empire State Development. This is the state of New York – for those of you guys that don't know what the Empire State is. Hope, hey, first of all, thank you so much for joining.

Hope Knight (01:21 to 01:23)

Thank you. Great to be here, Gene.

Gene Marks (01:24 to 01:36)

I'm glad that you are here. So, first of all, tell us a little bit about yourself. How did you ultimately become to be the president and CEO and commissioner of this organization?

Hope Knight (01:37 to 02:08)

So, after about 15 years in the private sector, I decided to go into community economic development. And over the last 20 years, I've worked at two organizations focused on attracting more resources to underserved communities, providing access to capital, working on real estate projects, and trying to bring businesses to communities that hadn't seen so much private investment over the course of time.

Gene Marks (02:10 to 02:47)

Gotcha, and, you know, Empire State Development is a state organization. Tell us a little bit about that, and you know, for people that are listening to this right now, this is like a New York state thing. This is for New York state businesses. However, even if your business isn't located in New York state, I'm betting that a lot of the things that Hope you're going to share with us, that what you're doing in your state is probably mirrored in other states, as well. I'm not asking you any specifics about that, but it is relevant to other people whether or not you're in New York State. But having said that, tell us a little bit about what Empire State Development is?

Hope Knight (02:48 to 03:20)

So, Empire State Development is the economic development arm of state government. It's sort of like the Department of Commerce on the federal level. We're involved in attracting businesses, providing support to small businesses. We're implementing the broadband initiatives, many of the sort of economic development activities that you see in your communities. We work with local governments to help implement those things.

Gene Marks (03:21 to 03:26)

How big an organization is this? What type of a commitment does New York state make to this?

Hope Knight (03:27 to 03:53)

So, we are an organization of about 650 people across the state. We're headquartered in New York City but have a large presence in Albany and have 10 regional offices across the state. So, we do have folks on the ground to be able to assist businesses, local governments, local community development organizations with the work that we do.

Gene Marks (03:55 to 04:17)

Okay, that's great. I mean, well, New York state is a big state, but I've talked to others that are also in economic development from different states, and a lot of states make these kinds of commitments for their businesses. And I'm assuming that, and you and I kind of mentioned this even before we started recording that one of your biggest challenges is getting the word out about the kinds of programs that you have, is that right?

Hope Knight (04:17 to 04:37)

No, that is correct. We have dozens of programs that are available to small businesses, and we work with partners and elected officials, municipalities, trying to get the word out on our programs because they're available for the small-business community.

Gene Marks (04:39 to 05:01)

Yeah, I hear you. So, let's talk about some of these programs. And again, the level of detail that you want to go into is completely up to you, because the more detail the better. But let's start with funding. I mean, every small business, startups in the state, all looking for funding opportunities. How does the Empire State Development help them with that?

Hope Knight (05:01 to 06:25)

So, ESD recognizes that small businesses drive New York's economic engine forward. And so, we have dozens of programs that support access to capital, technical assistance, business development programs, and more to support small businesses. We have been awarded $500 million from the Department of Treasury called, the program is called the State Small Business Credit Initiative, and with that, we are leveraging the $500 million 10 times to be a $5 billion program over the next 10 years to support small-business growth. And that is mostly through to mention credit access programs. So, vendor contract financing, capital equipment purchasing financing, just small-business lending. Some sort of capital access for businesses at all levels of the lifecycle, and we will be providing technical assistance as well, really focused on financial capacity and legal support over the coming months.

Gene Marks (06:25 to 07:22)

So, the state Small Business Credit initiative, I kind of want to zero in on this a little bit. It's a federal initiative. It's actually a COVID initiative, right? I mean, it was authorized during it to support small businesses. And then the federal government being the federal government, it took them forever to get the money out there, but now it's coming. And it's amazing when you say that you're multiplying what you're getting from the federal government by 10 times. So ultimately, there could be as much as $5 billion available to help small businesses.

Now, my business is not in New York state, but if I were, my first question to you would be like, wow, that's a lot of money, how do I get my hands on some of that money? So, what recommendations would you make for businesses in New York state? Like where can they go to access some of this funding, what type of funding it is, and to find out whether they're eligible for this kind of funding, what would you tell us?

Hope Knight (07:22 to 08:41)

So, let me talk about the special focus that this fund has. So, we're looking at the folks that have been least able to access credit, and that's where we're putting a tremendous focus. So, socially and economically disadvantaged owned businesses, very small businesses, veteran- owned businesses across the state. And so typically businesses in those categories have relationships with credit unions, community development organizations, other kinds of community development financial institutions, also known as CDFIs. Those are places that I would start with respect to looking for the programs.

You can go to our website at ESD.ny.gov. and find some specific providers that will be involved in this direct access. We have a lot of pre applications to help you figure out what you're eligible for or what you really need with respect to the type of capital that you're pursuing. So, that's a good start.

Gene Marks (08:42 to 08:52)

That's great. That's great advice. And just to be clear, it's not as if this money has been spent, right? I mean, this is over the next 10 years, this is happening ….

Hope Knight (8:51 to 8:52)

That's right.

Gene Marks (08:52 to 08:54)

So, this is an opportunity for a business ...

Hope Knight (08:53 to 09:06)

At the beginning of this program we started last year, and we will continue to roll out additional programs, but they are in place at this time.

Gene Marks (09:07 to 9:26)

And also, just to make clear, I know there is an emphasis to helping underserved businesses, maybe minority businesses, things like that. But there is still money available, whether it's capital or loans, available for existing businesses around the state as well, correct?

Hope Knight (09:27 to 09:28)

Absolutely.

Gene Marks (09:27 to 10:25)

Okay. All right. That's great. So great. So, the organization is helping funding, and just to be clear, one of your main vehicles is getting out this money under the State Small Business Credit Initiative. So, if you're a business in the state of New York, really, really important to go to you, to your website, find out where that funding is available and make some connections and see if you can access it. So, that's great advice.

Let's talk about workforce development next. It's funny, I was just speaking to a group of business owners just yesterday, and everybody is looking for employees. I mean, it's a tight labor market. And I know that New York state offers through your organization certain workforce development programs, grants and help to get people skills. Talk to me a little bit about those programs.

Hope Knight (10:25 to 12:14)

Yes, we have at ESD the Office of Strategic Workforce Development, and we have as our focus seven industries really looking at future positions and opportunities for work. So, industries like semiconductors, advanced manufacturing, construction, photonics, optics, digital media. And what we want to do is see proposals from workforce development organizations; those could be community-based training organizations, community colleges or other entities that are focused on training but also have a nexus to the employment opportunity. So, this is really about job training that results in employment after the training has happened.

And historically, there have been barriers to accessing these opportunities for many disadvantaged communities, like access to transportation or support for childcare or just training and coaching to kind of get through a new opportunity. And our workforce development funding provides for these additional supports that will help the job seeker through some of the – what I'll call – barriers that might exist in accessing this training.

Gene Marks (12:16 to 12:28)

Is the training provided directly to the job seeker, or can companies access this training to get skills for their existing employees or even new ones that they bring on?

Hope Knight (12:29 to 12:53)

So, it's for new opportunities, and employers can work with the training providers to create the curriculum and training that's necessary to access these opportunities in these areas that we're focused on.

Gene Marks (12:55 to 13:36)

That's great. And I want to reiterate again, for all of you guys listening or watching, particularly if you're a New York state business. When we talked about funding from the State Small Business Credit initiative, it comes to the state, and then the state is providing that funding to a bunch of different organizations, CDFIs and certain lenders and nonprofits. And it's the same thing as well, hope, with workforce development. So, it's not as if the state is writing a company a check. Just to make sure I'm clear, you guys are providing the funding to training organizations, and then they're the ones that can turn around and provide this type of training for companies employees. Am I describing that correctly?

Hope Knight (13:36 to 13:38)

That is correct, Gene.

Gene Marks (13:41 to 14:13)

So, say I've got employees. I mean, again, skills is a huge issue. So, say I've got some employees and I need them to learn a new piece of equipment or they need to learn. I want to get them trained on some marketing things, or I want to get them trained on discrimination or harassments or whatever. If that's all part of the funding, where can I go to find these organizations that are getting supported by you so that I can take advantage of those opportunities?

Hope Knight (14:13 to 00:15:11)

So, as I mentioned, our training that we are funding is really focused around the hard and what I'll call middle skills and these jobs of the future. And a lot of that training is happening at community colleges or the EOCs that the state runs - state educational opportunity centers. Those are places that I would start to seek training for new employees or even to seek new employees, because what I hear from lots of companies is they have a hard time hiring employees with the skills that they seek. And in the area of, like I said, advanced manufacturing and some of these innovation sectors, the community colleges and the EOCs are doing that kind of training.

Gene Marks (15:12 to 15:37)

See, that's really interesting, as well. So, what you're saying is that if we know that the community colleges and these EOCs are doing this training, they're getting funded by this day. Clearly, they're trying to get the skill levels up of their students, which would seem to be a great resource for companies to find workers. And I'm assuming those organizations have places for job placement to get their graduates employed. Is that also correct?

Hope Knight (15:37)

Yes.

Gene Marks (15:38 to 15:55)

Yes. it's great advice. And again, at ESD.NY.gov, that is the website that you want to go to as a business owner to find out where those training centers are, what community colleges are getting the funding. That would be the place I would start. Is that also a fair statement?

Hope Knight (15:55 to 16:39)

That is correct, Gene. I just want to make another point about this. There are situations in central New York where several businesses will get together because they need the same type of skills for new employees, and they'll go to local community-based organization and say, listen, these are the kind of skills we're looking for. We'd like you to provide this training. We can hire across all of us, 50 people, if you have a cohort of folks that are able to get through the training successfully. And that's the way matches are made with respect to the training organizations and the business community.

Gene Marks (16:39 to 17:15)

That's great advice. And you know what? It's not so different from, by the way, I'm based in Philadelphia, right? And Pennsylvania has very similar workforce development stuff as New York. I'm sure not as good, but okay. And they work through industry associations in the state, as well. So, there's a few manufacturing industry associations in Pennsylvania. They're well tuned-in to the workforce development programs that the state is offering so that they can connect their members to these programs. And I'm assuming you guys at Empire State Development do the same thing. 

Hope Knight (17:15 to 17:33)

Very similar, Gene. We have a very large manufacturing association across the state, and they're actually able to aggregate their members and get them to the right places with respect to the proper training organizations for their respective industries and organizations.

Gene Marks (17:33 to 18:28)

It's great advice, and it's a huge help for businesses to get their workers upskilled for sure, or even to hire and find workers that have certain types of skills. Let's talk about the formally incarcerated. So, I did a piece on this for the Philly Enquirer. I'm thinking of doing the same. I write also for the Chicago Daily Herald, and I've been obsessed with the whole formally incarcerated opportunities. I mean, again, I hear from client after client hope that they have a hard time finding people. And yet, when I talk to businesses that have worked with organizations that place the formerly incarcerated back into the workforce, I hear so many good things. They get loyal employees.

So, tell me a little bit of what New York State does, what the Empire State Development does to help businesses in the state, maybe hire the formerly incarcerated? What advice you might have around that?

Hope Knight (18:28 to 20:04]

So, a couple of things about New York state. You know, the governor has recently signed the Clean Slate Act. It seals certain convictions after a period of time. And I think this is an important step to provide liability coverage for small businesses who have concerns about their liability exposure when it comes to hiring people who have been impacted by the justice system. And so I think that from a policy perspective, that's something that has happened here in New York state.

But also, there are a number of organizations around the state who work with the formerly incarcerated and will tell you that they have tremendous barriers when they have come out and are seeking employment opportunities, and our workforce development programs seek to help mitigate those circumstances. So, access to reliable transportation. We are providing support for programs to make sure that their participants can get back and forth to program locations. Like I said, childcare, and then mentoring and coaching. Just providing folks with the ability to have someone to talk to as they make the adjustment to being in the training programs and then getting ready to access employment.

Gene Marks (20:04 to 21:02)

Yeah, my takeaway from the conversation I had is exactly what you're saying. Like, if you're a business owner in New York and you are looking to hire somebody that's been formally incarcerated, your best bet is to work with an organization, a nonprofit that's familiar with the process. In many cases, they do get state funding and help from the state and workforce development funds. But there are a lot of issues.

I get it. Like you mentioned, childcare and transportation and training of your existing employees. Not everybody's thrilled with having somebody was recently in prison come and work in their office. Fair enough. But I don't know hope if you see the same thing in these programs, but the people that are able to get these jobs tend to be more loyal and really, like, long-term workers for a lot of companies because they've been given the opportunity. And I think it's a great opportunity for businesses.

Hope Knight (21:02 to 21:37)

I do think it's a great opportunity for businesses. As I mentioned, I've worked in community development on the ground, and I've worked with businesses who have hired formerly incarcerated, and they do talk about how they're some of their best workers, most loyal, most engaged, wanting to learn more. And so I think it's a real opportunity. And listen, with unemployment rates where they are, we're going to really have to think differently about how we get more folks into the workforce.

Gene Marks (21:38 to 22:14)

That's right. Yeah, that's 100% right. And again, it's a population of people that could be really great employees. Okay, so we've talked about funding opportunities. We've talked about workforce development. We've talked about hiring the formerly incarcerated. All different things that the Empire State Development will help businesses do, either directly or through organizations. They're funding these organizations that then help businesses do this stuff. Let's talk about tax credits. Any come to mind that businesses should be familiar with or aware of in the state that you guys are helping to facilitate?

Hope Knight (22:14 to 24:02)

So, we have a couple of tax credit programs, very narrowly tailored. One is for the film industry. And when you look at the film industry, it's a highly mobile sector. Productions can happen anywhere. And so we have a program that's tailored to have productions film here in New York state. They're provided for a tax credit, and we work with them to think about engaging a diverse workforce, looking at diverse vendors. The thing about film productions is that it's not just about the production shooting in New York state. It's really around the ecosystem of vendors that get engaged as a result of the productions, which is why we believe that the film production sector is so vital to New York state's economy.

Another tax credit that we have is the Excelsior Job Tax Credit and that is focused on creating new jobs here in New York state, focused on these sectors of innovation, jobs of the future. And those are focused on the number of people that are hired for companies that are expanding or either locating here.

Gene Marks (24:03 to 24:08)

And that's called the Excelsior Tax Credit. Did I say, did I hear that right?

Hope Knight (24:08)

Yes.

Gene Marks (24:09 to 24:38)

Gotcha. So, there's tax credits for the film industry. There's tax credits for companies that are either here or relocating here that create new jobs. That's the Excelsior Tax Credit, all available from the state, as well. What about, is there anything specific to New York City businesses, Hope, that you might want to let us know about? We've been talking about sort of statewide programs. I'm curious if anything comes to mind.

Hope Knight (24:40 to 25:04)

We work hand in glove with the city, and the city is focused on a couple of specific industries. One I can name is the biotech industry. And the city is working on a big project right now that really focuses on engaging biotech firms here in New York City.

Gene Marks (25:06 to 25:32)

Okay, that sounds great. So, before I let you go, is there any other programs – I mean, we've talked about funding programs, we've talked about workforce development, we've talked about hiring the formerly incarcerated, we've talked about tax credits that are available for creating new jobs or businesses that are in the film industry. Any other big programs that you want to mention that again, if you're for business owners in the state of New York, they should know about.

Hope Knight (25:33 to 27:03)

Yeah, so this is not a program, but I want to talk about what I believe know once in a generation opportunity that is happening here in New York state. So, the semiconductor manufacturer, Micron, will be locating to central New York, right outside of Syracuse, and will be investing $100 billion over the next 20 years. And so that is the largest economic development project certainly in this state, and it might be in this country.

And we believe the opportunities that will result from Micron locating in central New York are going to be tremendous. Just I think it was last week the federal government named Central New York and the I-90 quarter going out to Buffalo, a tech hub. So, we got the designation of a tech hub that in combination with Micron, we're going to see lots of supply chain companies I think locate on that I-90 corridor. Just going to create 9,000 jobs at the micron location, but another 40,000 jobs from the supply chain. So, I think exciting things are happening here in New York State and tremendous opportunity for businesses here.

Gene Marks (27:04 to 27:46)

I've been speaking to Hope Knight. She is the president, CEO, and commissioner of Empire State Development. We've been talking about funding opportunities for New York state businesses, workforce development, money that's available for you to get your employees trained, tax credits that's available, new economic availability coming from in central New York, as well the opportunities to hire the formerly incarcerated, as well. The state helps with that all great stuff.

If you want more information, you can visit ESD.ny.gov. Hope, thank you so much for taking the time to speak with us. You guys are doing great things in the state of New York, and I hope that continues. Thank you.

Hope Knight (27:46 to 27:49)

Thank you, Gene. It's great to talk to you.

Gene Marks (27:50 to 28:24)

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