Reported by: Evan White, 13 WHAM

Rochester, N.Y.–In June, the Empire Zone program ended, paving the way for a new business tax incentive plan known as “Excelsior.” Businesses are trying to figure out what the change wil mean to them.

Leaders have acknowledged that the Empire Zone program, which cost on average $550 million per year, was not living up to the job-creation expectations.

Businesses involved with Empire will still receive tax breaks owed to them, though they will be deferred according to Empire State Development Corporation.

Excelsior will begin with $50 million in funding, roughly 10% of the annual cost of its predecessor.

That number will grow within five years to $250 million, according to ESD. After nine years, ESD says the state’s total investment will be $1.2 billion. Still, some businesses are not happy with the change.

“It’s very unfortunate that there was new legislation to change the program so dramatically that companies looking at the area can no longer take advantage to those benefits,” said Jeff Valentine, President and CEO of Callfinity, a Rochester telecommunications company.

Hammer Packaging President Jim Hammer said the Empire Zone incentives have been critical to the growth of his company.
In the last 6 to 7 years, he estimates that with the help of tax breaks, Hammer Packaging has doubled.

He’s expecting less funding in the future, which, in his eyes, could hurt growth and jobs.

“We have global competition and every cent that we can get to reinvest in the business to reduce costs is important to us,” said Hammer.

President and CEO of Greater Rochester Enterprise, Mark Peterson said the Empire Zone program was confusing and problematic. However, he is hopeful that once fully introduced, the Excelsior Program can boost business and investment statewide.

“I think the proof is always in the pudding, we really need to see the regulations of the new Excelsior program,” said Peterson.

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