Seven Otsego County businesses are at risk of being decertified by the state's Empire Zone program, according to state Sen. James L. Seward.
Last week, Empire State Development, as part of an overhaul approved during the state-budget adoption process this year, sent letters to 2,000 of the state's 8,780 zone-certified businesses stating they had been terminated from the program or were at risk of being terminated.
The at-risk businesses have been asked to provide additional paperwork to Empire State Development, according to a media release last week from Seward.
But Seward, R-Milford, said Sunday that such an overhaul could lead to devastating job losses, amounting to "pulling the rug out from under businesses.
"The Empire Zone program has helped foster job growth across upstate New York," Seward said. "Tightening the program to weed out those who have not lived up to their contract is one thing, but this one strike and you're out' mentality will only hurt our economy and give businesses another reason to flee our state."
The Empire Zone program was created to give tax breaks to businesses that move to or expand in designated areas of the state. In exchange, the businesses must meet standards including job growth.
Because the state changes are retroactive to Jan. 1, the tax credits due to businesses on taxes they may have already paid are being withheld, Seward said.
The Otsego County businesses named are Mold-A-Matic, T.S. Pink Corp., BK Associates International, Karabinis Development, Corning, Custom Electronics and Adirondack Leather Products.
In addition, seven businesses in the Greater Norwich Empire Zone were decertified. These include Cwynar & Company CPAs, Venusta Hotels, The Renaissance Building/Arnel Music, The Three Amigos, Pet Street Station Animal Hospital, Sun Printing and Allentown Properties. The Raymond Corporation, Hart's Electrical Service, Sureseal, NBT and Wilson Funeral Home were sent letters requesting more paperwork.
"Changing procedure in the midst of the economic slowdown is counterproductive," Seward said. "Many businesses are struggling right now, and we should be using the Zone benefits to help businesses to survive."
Otsego County Empire Zone Coordinator Zondra Hart said Sunday that the Otsego County businesses identified by the state may not be at risk.
"At this point, we have no businesses that are being decertified," Hart said.
Hart said the state may need more information because not all businesses are on the same fiscal calendar when it comes to paying taxes. The state is seeking additional paperwork to compare to businesses' annual reports, which are required to be filed with the state.
The state is running a $3 billion budget deficit for the 2009-10 fiscal year, which started April 1.
