Start-Up NY tax-free program administrator replies to critics

The head of Gov. Andrew M. Cuomo's program of tax-free zones for expanding businesses fired back at the initiative's critics during an appearance on Long Island.

"Give us a chance, give us a chance to create jobs for the state of New York," Leslie Whatley, administrator of the year-old Start-Up NY program, said in an interview after a speech at Stony Brook University.

She predicted Start-Up NY would eventually produce benefits that would extend beyond the companies that have enrolled. Those businesses will pay no state and local taxes for a maximum of 10 years.

Whatley said suppliers, vendors and others tied to Start-Up NY participants would move to New York State or expand here. Service businesses would add employees.

"The criticism is premature," she said.

Whatley's comments, made on Tuesday, were a response to last week's call by a coalition of groups, including two state political parties, to suspend Start-Up NY and have it audited by the state comptroller.

The coalition said too few jobs had been created so far to justify the $53 million spent on Start-Up NY advertising since December 2013.

Whatley said most of the 93 companies enrolled in the program, from May 2014 through last month, have yet to move into the tax-free zones, which are on college campuses. That's why only 76 jobs were created in the year ended Dec. 31, 2014.

"Economic development doesn't happen overnight," she told about 70 people at a workshop for entrepreneurs held at Stony Brook's Center of Excellence in Wireless and Information Technology.

The Start-Up NY participants, as a group, are expected to hire 2,805 people statewide in the next five years, with 239 in Nassau and Suffolk counties.

Cuomo is unlikely to agree to suspend Start-Up NY, which was his idea two years ago. Comptroller Thomas DiNapoli is wrapping up an audit of the Start-Up NY ads, along with those for the "I Love NY" and "New York: Open for Business" campaigns.

Whatley also said Tuesday that Stony Brook's early adoption of Start-Up NY helped Long Island attract 21 participants, the second highest number in the state after Buffalo. She predicted the pace of enrollment would accelerate this year.

Farmingdale State College and LIU Post also have tax-free zones. Other local colleges will likely secure zones this year, Whatley said, adding that she is working with Hofstra University, Molloy College, NYIT and Suffolk County Community College, and others.