Government Affairs Albany Update
November 19, 2010

• Budget Update
• SBC IV
• BCNYS Submits Comments on MWBE Rules
• Small Business Funding
  

Budget Update

Division of Budget Director Robert Megna provided an update on the state’s budget situation at the Rockefeller Institute in Albany. A copy of his presentation is available here.  Among the “highlights:”

• Megna noted that at the “quick start” revenue forecasting conference with the state legislature, the legislative fiscal staffs had a more pessimistic revenue forecast than did the Administration, at nearly $1 billion less, for fiscal 2012.
• His presentation illustrated the recession’s impact on personal income, capital gains, and Wall Street bonuses – impacts that have resulted in significant loss of personal income to the state.  For example, capital gains realizations in New York fell from $119 billion to $33.3 billion from 2007 to 2009, and that while overall personal income overall fell about 6% from 2008 to 2009, Wall Street bonus income fell by about 40% over that same period.
• DoB’s projection of next year’s structural budget deficit has increased to about $9 million.  Both the FY 2012 projected deficit, and this year’s growing gap, is effected by higher than expected increase in Medicaid case load of some 500,000.  Megna said they believe the growth in case load has now leveled off.

Megna’s conclusion was that New York simply cannot afford to continue to pay for everything it now pays for, adding that the state has no mechanism to finance the state’s $27 billion transportation infrastructure plan, the MTA or SUNY capital plan, or the state’s 2007 commitment to restructure school aid. 

Staff contact: ken.pokalsky@bcnys.org

SBC IV

The Business Council has drafted comments on NYSERDA’s proposal to extend the $180 million per year “system benefit charge” program through the end of calendar 2015 and is looking for final member input on this issue.  In general, our comments call for a more detailed consideration of energy investment needs before the Public Service Commission approves another $800 million in assessments; that final approval of any SBC extension should be based on a more detailed operating plan, developed with significant stakeholder input; and any additional SBC funding approved by the PSC should focus on priority grid and technology investments, rather than spending categories receiving significant funding through other sources, such as energy efficiency and workforce development.

Staff contact: ken.pokalsky@bcnys.org

BCNYS Submits Comments on MWBE Rules

The Business Council has submitted comments on Empire State Development’s draft regulations implementing the 2010 “Business Diversification Act.”  The 70 pages of draft rules would impose significant new reporting by businesses wishing to compete for state contracts. While the goal of the new statute (see End of Session Contract Procurement wrap-up) was to expand minority and women owned businesses state contract procurement opportunities through increased set-asides and the establishment of statewide sector standards for contracting with certified MWBEs, the proposed regulations offer little in the way of increasing the shortage of certified MWBEs in NYS, but seek to impose vast new reporting and disclosure requirements by bidders. Additionally, under the proposed regulations, state agencies will have new compliance and audit enforcement authority specifically related to the MWBE language. A copy of the Business Council’s comments submitted on the rulemaking can be found here.   

Staff contact: lev.ginsburg@bcnys.org

Small Business Funding

The Paterson Administration has announced availability of up to $50 million in loans to small businesses across New York State over the next two years, through the State's new Small Business Revolving Loan Fund which was created under the Fiscal 2011 state budget.  The funds will be made available through a network of twenty community development institutions and other community-based lending organizations statewide. The program is based on $25 million in State allocations, in combination with $25 million in additional private matching funds from the selected lending institutions. It will support “microlending” of $25,000 and below, as well as larger small business lending of up to $250,000 or above, and will focus on minority and women-owned enterprises and other small businesses that are having difficulty accessing traditional credit markets. Funding applications will be administered directly through the 20 designated financial institutes.  More information on this program is available here. 

Staff contact: ken.pokalsky@bcnys.org

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