Manufacturers worry about budget cuts for industrial zones
The city is moving to eliminate funds for a program to help manufacturing businesses in Port Morris, leaving their proprietors worried that in the midst of an economic downturn they are losing an important source of support.
The cuts proposed by Mayor Michael Bloomberg would eliminate the staff members of non-profit organizations who help businesses train workers, navigate city regulations and apply for loans, permits and tax breaks.
Each of the city’s 16 industrial business zones now employs these advisors, called Industrial Business Providers. In Port Morris, the help is offered by SoBRO, the South Bronx Economic Development Corporation at a cost of $100,000.
When his administration created industrial business zones in 2005 to keep manufacturers from moving from the city, the mayor made “an ironclad commitment to maintain manufacturing zoning in key industrial areas and not permit residential use.” He announced tax credits for companies that moved to the zones. And he offered the support of advisors to help cut red tape.
Noting the flight of manufacturing from the city, taking thousands of jobs with it, the mayor said, “We believe that our new industrial initiatives will stem this tide and grow our manufacturing sector.”
Now, though, he says the city can’t afford to continue to pay for the Business Solution Providers.
The incentives of industrial business zones will still be offered, but without the
Solution Providers, they’ll be much harder for businesses to obtain, business owners say.
SoBRO’s experts are “like my day-to-day person to go to,” said Stacy Seecharan, who owns B&S Ironworks on East 134th Street. “If I have a problem, they respond as to what I should do.”
“We’re a link in the chain,” said Stephane Hyacinthe, the coordinator of the Port Morris IBZ, which is bound by Bruckner Boulevard and the Major Deegan Expressway. “We help businesses find incentives that they usually don’t know are out there.”
Even when they know what incentives are available, applying for and receiving them without guidance can be confusing, said Giorgio Palmisano, the director of business development for Minerva Bunker Gear Cleaners, which inspects, cleans and repairs the protective clothing worn by the city’s firefighters, on East 134th Street.
Palmisano recalled spending hours trying to find accurate information online about whether his business was eligible for an environmental credit for limiting the amount of water it discharged into the city’s sewer system.
He found the information because “it was Stephane and that office who guided us and who took the time and effort to follow up on things,” he said.
Many of the area’s businesses are family run and have few employees, said Palmisano—and the tedious process of filing paperwork with the city intimidates them.
“It’s viewed as a bureaucracy that takes too much time,” Palmisano said.
And anything that makes it difficult for industrial businesses to stay in New York City is simply not a good idea right now, said Sarah Crean, the deputy director for the New York Industrial Retention Network, a non-profit economic development corporation that works to promote blue-collar jobs in the city.
“It defies reason to remove certain supports for small businesses when the city is losing jobs,” Crean said. “Manufacturing provides entry level jobs to people and the opportunity to move up and advance in the company.”
That’s especially true in the South Bronx, Hyacinthe said. He estimated that about 80 percent of the people employed by companies in the Port Morris zone live in Port Morris or nearby Mott Haven or Hunts Point.
While he doesn’t expect businesses to pack up and leave because of the budget cut, he is concerned about the long-term outlook.
“It won’t be like a fire sale; they’re not all going to get up and leave in one moment,” Hyacinthe said. “But small businesses already feel like the government doesn’t assist them, and this is just going to add to their discontent.”
A representative for the department of Small Business Services, which oversees the city’s industrial business zones said the department is committed to making sure the zones run smoothly.
“Contracts are in place until September 30th and in the meantime, we are working to address the budget situation and remain hopeful that we will achieve a positive outcome for the program,” a spokesman said in an email.
While they wait to see what happens, Hyacinthe is connecting with other IBZs in the city and asking business owners to write letters to Mayor Bloomberg and City Council Speaker Christine Quinn to encourage them to find the money to preserve the program.
“We should know in June what’s going to happen next year,” Hyacinthe said. “And we’ll fight tooth and nail up until that point.”
A version of this story appeared in the May 2010 issue of the Mott Haven Herald
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