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Don't Hinder Small Business Growth


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Mayor de Blasio announces the expansion of paid sick leave legislation (Rob Bennett, Mayor's Office)


The following entry is part of The Small Business Corner, a collaboration between Gotham Gazette and GoBizNYC:

A recent piece in The New York Times highlighted how heavy regulations have inhibited growth among businesses in France. When French businesses grow to 50 or more employees, they are subject to a host of employment and accounting regulations that significantly increase their operating and administrative costs. As a result, many companies cap their firm size at 49 employees. With unemployment in France stuck at a record high of above 10% as well as continued private sector contraction, such disincentives to growth do not bode well for the country's worsening economic situation.

We have seen a similar trend here in New York City. According to the Partnership for New York City's NYC Jobs Blueprint, since the financial crisis in 2008, there has been a 7% net increase in the number of firms with one to four employees. Over the same period, however, there has been a 1% net decrease in the number of businesses with 50 or more employees. This indicates that though there is plenty of new entrepreneurial activity, the city's start-ups and small businesses are not able to scale up at a comparable rate.

Given the elaborate web of regulations local businesses must comply with, it is not hard to see why this is the case. For entrepreneurs who have enough on their plate managing all of the day-to-day aspects of their business while competing in the highest-cost city in the country, having to also navigate a complex bureaucratic system not adapted to the needs and pace of a small business presents yet another hurdle to success.

That's why the Small Business First initiative that was recently unveiled by the de Blasio administration is so important and timely. Small Business First aims to make the city more business friendly by simplifying regulatory processes across multiple city agencies and promoting compliance through education. This announcement, along with earlier commitments to reduce revenue generated from small business fines, indicates that this administration is devoting the necessary attention and resources to reforming the systemic complexities small business owners face every day.

At the same time, we must ensure that these gains are not offset by new layers of regulation that add to the already heavy burden on small businesses. For instance, small business owners have been scrambling to understand how to comply with new employer mandates like the Paid Sick Leave Law and are worried that there are more costly and burdensome regulations to come.

A tough regulatory environment has long-term ramifications. The International Monetary Fund has predicted that France's unemployment rate will not show any appreciable decline until 2016 and has warned that the country faces a "negative spiral of low growth and falling inflation."

New York City must learn from France's example and not implement policies that could hinder growth and stall recovery during future economic downturns. Our policymakers and elected officials must work closely with the small business community to ensure that the unintended consequences of any new regulations—in the short- and long-term—are minimized. Only through such collaboration will we be able to cultivate an economy that fosters small business growth and job creation and that remains resilient in tough times.

Victor Wong is the Director of Business Outreach & GoBizNYC at the Partnership for New York City

@GoBizNYC
@GothamGazette

To make or discuss a submission for The Small Business Corner:

Reach GoBizNYC Director Victor Wong at This email address is being protected from spambots. You need JavaScript enabled to view it.

Reach Gotham Gazette Executive Editor Ben Max at This email address is being protected from spambots. You need JavaScript enabled to view it.

The Small Business Corner is a bi-weekly column featuring the opinions and perspectives of small business owners and advocates from the GoBizNYC network on the range of issues that concern the city's small businesses.

To all New York City small business owners and advocates: we hope this new platform, The Small Business Corner, will better enable you to engage in the local policy conversation and we look to you to support us in this endeavor by sharing your thoughts, experiences, and voices. To learn more about how you can be a part of GoBizNYC and participate in this effort, visit GoBizNYC.org.

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In a Most Political District, A Conspicuous Lack of Debate


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Then-Public Advocate Bill de Blasio is arrested at a LICH protest (photo: Public Advocate's office)


Few swaths of the city have been home to more controversies over the past decade than Brooklyn's 52nd Assembly District. From the creation of Brooklyn Bridge Park and closing of Long Island College Hospital to the prolonged rollout of Atlantic Yards, the area has been nothing if not contested terrain.

Given the various neighborhoods' traditions of civic activism, one might expect to find a lively race to succeed Joan Millman, who in late May announced that she was giving up the assembly seat she held since 1997 in order to take a job with the de Blasio administration.

Instead, the contest is best viewed as the battle of two machines, old vs. new—creating a deficit of democracy in a district where people typically pay more attention to local issues.

A district leader since 2004, Jo Anne Simon is running with the support of both Millman and the Kings County Democratic Party. Frank Seddio, the current party boss, is no kingpin in the tradition of Meade Esposito, and is generally seen as less influential than his predecessor, Vito Lopez (an ally of Seddio but not Simon).

Pete Sikora, meanwhile, represents the new guard, which consists of the Working Families Party, the consultancy BerlinRosen, State Senator Daniel Squadron, and Council Members Brad Lander and Steve Levin. Formerly at NYPIRG, Sikora currently is a lobbyist and legislative director for the communication workers union, a leading player in the WFP.

The third candidate in the race is in the unallied Doug Biviano, a Brooklyn Heights-based activist. That he lacks connections to either machine helps explain why he's less well-funded. Biviano, however, garnered 2500 votes (with only $20k) running against Millman in 2010, suggesting that he can be a factor.

Biviano recently attacked Sikora for his role in the campaign to save LICH. Sikora takes credit for proposing to de Blasio last summer that the then-mayoral candidate and others (including Sikora) get arrested to protest the hospital closing. Sikora told me that he's "very proud" of his role in initiating the act of civil disobedience.

However, many within the area now view de Blasio's high-profile effort as little more than a campaign stunt. BerlinRosen recently circulated a letter defending de Blasio's handling of the LICH closing, an act of damage control by the mayor's team—and one that suggests that the scars won't heal for a while.

As for what to do next at the site, Sikora vows to "fight against high-rise luxury housing," whereas Simon and Biviano are calling for a full-service hospital. Simon also pledges to push for a "Health Care Management Information Act" in Albany that would provide full needs assessments before future hospital closures.

All three candidates are opposed to the high-rise housing (combining luxury and affordable units) proposed for Brooklyn Bridge Park. Simon is proposing that a ferry terminal at Pier 7 could match the revenue for the park that the housing would produce—but the de Blasio administration seems intent on proceeding with its plans.

Simon is also the only one of the three candidates who has been active on Atlantic Yards, of which the WFP was an early supporter. Simon has been a leading figure in Brooklyn Speaks, which sought to stake out the middle ground between Forest City Ratner and Develop Don't Destroy.

Brooklyn Speaks recently claimed success in helping accelerate the pace of affordable housing at Atlantic Yards. While the agreement announced in late June does provide greater accountability, there are major concerns regarding the actual affordability of most of the units—nearly two-thirds of which will go to families earning more than $100,000.

As Simon explains, the issue of actual cost was "outside the scope" of the Brooklyn Speaks' lawsuit, while the gentrification of Prospect Heights has inflated the Area Median Income used to determine the affordability guidelines. Both are valid points, but Simon and Brooklyn Speaks were quick to claim victory despite the fine print.

The real growth area in the district, of course, is Gowanus. While Simon has been a vocal supporter of the SuperFund designation for the site, neither she nor the other two candidates seem to be spelling out a vision for the neighborhood.

It's precisely the need for district residents to hear more from the candidates about their ideas that makes the absence of scheduled debates so conspicuous. At the moment, there's only one on the calendar—hosted by the Prospect Heights Neighborhood Development Council on August 27th. The district only contains a small sliver of that neighborhood.

In the absence of debates, or extensive media coverage, voters will encounter the candidates in traditional fashion: at their doors or on the streets, which places all three contestants on equal footing; and via mailers and robo-calls, which cost money to produce and circulate.

Thus, voters in the 52nd district will be hearing plenty from Sikora and Simon between now and the September 9th primary. Simon has chosen a dubious line of attack, accusing Sikora of inflating his claims regarding his work on NYPIRG's successful effort to win passage of city council lead paint legislation. Fact check: Sikora was at the forefront of that campaign.

In any district, sniping politics-as-usual helps explain the falling rates of voter participation, which increases the power of the machines. And when some of the most engaged voters in the city are being served red herring, it's bad for everyone's health.

***
Theodore Hamm is chair of journalism and new media studies at St. Joseph's College in Clinton Hill, Brooklyn.

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Complete the Full Second Avenue Subway Now


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Second Aveue Subway construction (samschwartz.com)


Ask a hundred people who live on the East Side what they love about their neighborhood and you'll hear a hundred different answers. Ask the same people what is their least favorite thing about where they live and you'll hear the same refrain over and over: it's too far from the subway!

New York neighborhoods live or die based on their proximity to public transit. The far East Side, from Third Avenue to East End Avenue, has always suffered due to its distance from the Lexington line, the only subway line operating in the 8 full avenue blocks between Central Park and the East River.The Lexington line serves an average of 1.3 million riders each day – more than the average daily ridership of any other entire transit system in the US.

The Second Avenue Subway offers the promise of public transit to the East Side to neighborhoods long isolated. When Phase 1 opens in 2016, the entire East Side will enjoy the same easy access to subways as the rest of Manhattan. New Yorkers who live and work on the far East Side will finally know what it's like to catch a train just a couple of blocks away.

Where, though, will that train take them?

As of 2016, not very far. The first phase of the Second Avenue Subway, opening in 2016, will only extend the Q line from 57th Street to 96th Street. While this will provide some much-needed relief on the Lexington line, it doesn't truly solve the problem: a dearth of subway access east of the entire length of Lexington Avenue.

Extending the Q train four stops only helps Upper East Siders travelling to destinations near Broadway (mostly on the West Side in midtown.); it does nothing to connect uptown and downtown on the East Side, the route where the need is most critical. True transportation equity requires a full build of the Second Avenue Subway, from 125th Street to Hanover Square.

It is unclear if the MTA is prepared to seamlessly move forward with construction. The MTA's Twenty-Year Capital Needs Assessment, released in October 2013, devotes only three paragraphs (out of 140 pages) to the Second Avenue Subway construction, noting that "[i]mplementation of future...phases will need to take into account MTA's ability to fund and plan each functional incremental stage." The decade old Environmental Impact Statement for the project has not yet been updated, one of the very first steps the MTA will have to take to plan for future phases. As of yet, no concrete steps have been taken to ensure that construction of the Second Avenue Subway will continue past Phase 1.

This is an enormous mistake.

It's a mistake to introduce a delay of any kind into this construction process. When Phase 1 concludes in 2016, the team of thousands that has made this project possible will disband without a new phase to move on to. Any pause between phases, no matter how slight, will result in a loss of institutional knowledge, equipment, staff and experienced contractors, and cause future delays.

It's also a mistake to miss out on the lowest interest rates we're likely to see for decades. Right now is a perfect time to raise capital to continue Second Avenue Subway construction. In order to take advantage of this, we need to build as much as we can, as quickly as possible. Rather than simply moving forward on only Phase 2, the MTA should finance and begin construction on both Phase 2 and Phase 3 simultaneously. We must build a subway that meets the urgent need that was the impetus for the 2nd Avenue Subway more than 80 years ago.

As New Yorkers, we all know the benefits that subway access can bring. We've already seen the far East Side spring to life in the last few years in anticipation of the opening of Phase 1. However, we also know that partially finished projects usually don't deliver any of the promised benefits – building half a bridge is just a waste of money.

Extending the existing Q line a mere 40 blocks does not fulfill the promise of the Second Avenue Subway. It's time to boldly move forward and begin financing, planning and building the next phases of this project. The East Side has waited long enough for transit equity.

***
Assemblymember Dan Quart represents the 73rd District on Manhattan's East Side and is a member of the Committee on Corporations, Authorities and Commissions, which oversees the MTA

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