The state has approved 13 tax-free zones tied to the University at Buffalo where businesses that locate new jobs could pay no state or local taxes for 10 years through the Start-Up NY initiative, university officials announced Friday.
UB is the first area school to receive approval for Gov. Andrew M. Cuomo’s Start-Up NY program, an expansive menu of tax incentives meant to draw new jobs and companies to colleges and universities across the state.
The school’s 13 tax-free zones total 177,000 square feet – taken together, they would fit comfortably within an average Walmart Supercenter – and are primarily located on or near the downtown Buffalo Niagara Medical Campus.
UB has had discussions with numerous businesses interested in the Start-Up NY benefits, and this initial approval from the state allows the university to begin to formalize those plans. UB officials say the school could have companies moving into its zones by the end of spring.
“I would say we’re officially open for business,” Marnie LaVigne, UB’s associate vice president for economic development, said in an interview Friday. “I think you’re going to see us moving extremely quickly.”
UB was one of eight schools approved in the first wave for Start-Up NY, which is aimed at startup companies, local companies that would expand or out-of-state companies that would move into the tax-free zones.
“Totally tax-free zones. One hundred percent tax-free. No income tax. No property tax. No sales tax. Not for the owner of the business. Not for the employees of the business – for any new jobs created. It makes these zones the least expensive place in the United States to locate a business,” Cuomo said during a recent budget address in Amherst.
The program initially was focused on SUNY campuses but was expanded to include more New York City-area schools. Private colleges and universities also may participate. The State Legislature approved the plan last year.
The colleges serve as the point of contact for companies interested in joining Start-Up NY. Since the original announcement, SUNY campuses in this area have drafted preferred boundaries for their zones and identified industry sectors that make the most sense to target.
“UB’s research strengths in the emerging fields of advanced manufacturing and materials, big data supercomputing and nanotechnology are particularly suited for new business partnerships under this initiative,” Alexander N. Cartwright, UB’s vice president for research and economic development, said in a statement.
In addition to UB, the eight schools included in the first round of approvals are: University at Albany, Onondaga Community College, Cornell University, SUNY Ulster, Monroe Community College, SUNY Downstate and Stony Brook University.
Empire State Development, the agency that oversees the Start-Up NY program, approved the UB list as submitted by the university in December.
In addition to the medical campus and downtown Buffalo locations, there is one site on the UB South Campus and another at the North Campus.
Schools can include on-campus space, as long as it doesn’t displace an academic program, or a limited amount of off-campus space.
UB did say that it has put one of the 13 properties, its former Educational Opportunity Center building at 465 Washington St., on the market, and therefore that building may not end up being used as part of Start-Up NY.
LaVigne said the university expects to add and subtract properties as it tries to best meet the needs of interested companies.
“We’re definitely looking to amend the plan because we have additional properties we’re interested in,” she said.
The school now will hold more serious discussions with the companies that have shown a desire to take part.
College sponsors file an application to Empire State Development on behalf of their business partners, and UB expects to send in about half a dozen of those applications in the next few weeks, according to LaVigne.
Once the state agency grants its approval, those businesses could begin moving their new employees into a tax-free zone by the second quarter, she said.
The university did not say how many jobs it expects to create through the program, though there is a statewide cap of 10,000 employees who would be eligible for the income-tax incentive.
Start-Up NY doesn’t exist in a vacuum. Some of UB’s Start-Up NY companies also may take part in some of the state’s other economic development initiatives, such as a genomic-medicine research consortium and the 43North business competition.
“These were, I believe, purposely designed to be very complementary,” LaVigne said.
Most of the other SUNY schools in Western New York also have submitted a proposed list of tax-free zones to Empire State Development.