The Benefits of Having a Business in New York

The Benefits of Having a Business in New York

A growing number of manufacturers (and other businesses) are realizing there are a lot of perks of doing business in New York.

A few decades ago, most large companies’ manufacturing operations relocated offshore to reduce costs and remain competitive. The COVID pandemic highlighted one of the biggest risks of this move – not being able to get products, supplies, and inventory when and where they are needed. Regionalization shortens the supply chain, puts products closer to customers, and lowers shipping and potentially production costs.  So, reshoring – or bringing manufacturing or parts of it back to the US – is the next big trend. Even the White House is doing its part to help manufacturing thrive on American soil.

While you would think up-and-coming cities in other parts of the country with lower costs of living would be attractive to these operations, don’t count New York out.

Overall, employers in New York are experiencing the lowest taxes in decades and have a lot to look forward to thanks to the $150 billion in upcoming infrastructure investments in state-of-the-art business and transportation systems. The state boasts one of the country’s largest higher education systems and a plethora of workforce development programs. It’s a leader in low-cost clean energy and protecting the environment. Plus, there’s something for everyone from the arts, sports, fine dining, and culture to a variety of outdoor activities and spaces.

While the entire country is striving to rebound from the Great Resignation and a beyond-tight talent pool, New York State’s Workforce Development Initiative is investing $175 million to meet current and future staffing needs. Funds are available to build regional talent pipelines, expand workplace learning, address short-term and long-term staffing needs, and more.

New York’s Department of Labor and State University of New York (SUNY) system collaborate on apprenticeship programs and positions in advanced manufacturing. Businesses are benefitting from university research and development (R&D) resources and universities are benefitting from providing students with hands-on experience, with more than 70 Empire State Department of Science, Technology and Innovation (NYSTAR) funded facilities and tools.

In the state, there are 10 regional economic development councils (REDCs) charged with developing strategic plans for growth and investments in their respective region. The councils are made up of public-private partnerships, with experts and stakeholders from business, academia, local government, and other organizations.

For example, existing businesses and businesses that are expanding within or relocating to the Hudson Valley have access to the Hudson Valley Economic Development Corporation (HVEDC), which strives to drive business innovation, attraction, and expansion throughout the region. The council offers regional and state collaboration; market, economic, workforce, and real estate data and statistics; site search consultations; business education; and training.  

The state offers a broad variety of tax incentives and business credits to support business development, startups, expansions, relocations, process improvements, energy efficiencies, low-cost power, workforce development, and more. Manufacturers benefit from tax credits, including property tax credits and business incentives.

New and existing NY businesses receive tax credits for jobs, capital investments, and R&D through the Excelsior Tax Credit Program.

Businesses new to the empire state can receive a 5% cash refund on capital spending up to $350 million and 4% for spending above that during the first five years of operation. There are also numerous grants available for job creation or corporate infrastructure through Empire State Development.

Even the 2022 state budget includes tax breaks for businesses to comply with public health orders and keep their businesses safe; tax credits for hiring veterans, at-risk youth, people with disabilities, and apprentices; and tax credits for clean heating fuel, upgraded electric vehicles, and recharging.

For more information about doing business – or more specifically manufacturing – in New York, visit the Manufacturers Association of central and upstate New York; Manufacturing and technology enterprise center in the Hudson Valley for business consulting services related to technology and engineering; and the Business Incentives Guide, which focuses on New York City but includes state and federal resources for financing, taxes, energy, and workforce.

For more information about taxes, accounting, and finance, contact RBT CPAs – a professional, local resource supporting businesses in the Hudson Valley for more than 50 years.

Tips to Address Top Construction Challenges in 2022

Tips to Address Top Construction Challenges in 2022

“It was the best of times. It was the worst of times.” It was as if Charles Dickens was writing about the construction industry in 2022 when he penned these infamous words.

On one hand, the industry is looking at its single biggest cash infusion of all time. With the American Rescue Plan Act and Infrastructure Investment and Jobs Act, many construction projects will be kicking off in 2022. On the other hand, persistent labor shortages, supply chain bottlenecks, skyrocketing materials prices with no expectation of stabilizing anytime soon, fuel cost increases, inflation, and other challenges are plaguing the industry. So, what’s a construction firm to do? Start by focusing on the top one or two challenges.

The 2022 Association of General Contractors (AGC) Survey of providers in the Northeast and nationally shows the pandemic’s top impact on projects to be:

  1. Costs are higher than anticipated.
  2. Projects are taking longer than expected.

While those findings are probably no surprise, we hope some research we’ve done introduces you to one or two new ways to address cost and time challenges. It’s important to note that fixes for one challenge – time or cost – in many cases has a positive impact on the other; they are not mutually exclusive. With that in mind, here are some budget and scheduling tips:

  • Be smart when developing a budget. The 2022 AGC survey found 62% of respondents were putting higher prices in bids and contracts. So, consider including a 5% to 10%
  • Be realistic about scheduling. According to the 2022 AGC survey, 32% of respondents in the Northeast are putting longer completion times into their schedules. Create a master schedule, break it down into phases and then into tasks. Remember to include time for everything from paperwork to permits and inspections. Include a start and end date for each task and confirm you’ll have the equipment, materials, and staff to meet timelines. Consider what can occur concurrently and what needs to happen sequentially. Add 10% for unexpected issues and delays. Make sure your contract allows for time extension requests in certain circumstances.
  • Get to know the details and plan accordingly. Know your project specs inside and out. Verify property boundaries and determine where anything underground is – pipes, septic, water, gas, electric. Draw a site layout to show where everything will go, including material, equipment, trailer, break areas, employee entrances, etc., so you can identify and fix potential issues before a project gets under way. Make sure insurance is up to date.
  • Create a contingency plan. Expect and plan for the unexpected. Work with your team to identify potential risks and contingencies (i.e., plan for overtime if project is running behind; weather delays may warrant extra equipment and staff). Then, develop a risk management plan.
  • Make safety a non-negotiable priority. Accidents and potential safety hazards can hurt budgets and timelines, not to mention businesses and reputations. Make sure your team and subcontractors know your safety expectations. Review your safety plan. Reinforce its importance daily. Address issues before they escalate. Make sure everyone knows how to escalate an issue or concern.
  • Staff up. Some anticipate the labor shortage may pose even bigger challenges than what’s going on with supply chains and materials. So, focus on staffing and building relationships and backup relationships. Evaluate your benefits and pay. Decide whether it’s time to invest in upskilling. Reach out to community colleges and technical institutes to build a pipeline of potential talent.
  • Work as a team. Make sure you have a full lineup with all positions covered – from supervisors to safety managers, expeditors, and more. Officially kick-off each project. Have your team and subcontractors review, give input, and sign off on plans. Hold weekly team meetings and clarify your expectations about communicating potential delays or risks. Make sure you listen to what your team members have to say.
  • Manage your customer. Investing more time up front walking your customer through the ins and outs of the project can save you time and money later. Before starting a project, get your customer’s sign off on all materials and costs. Also make sure your customer understands how scope changes can impact time and costs. Set a cut-off date for customer changes and stick to it.
  • Manage your project every day. Monitor and track your timeline and budget with daily reports. Pay attention to the details. Watch for red flags.
  • Shop smart. If you’re a small organization competing against big ones, look to level the purchasing field with a group purchasing organization. Consider alternative materials that may also be less labor intensive. (For example, synthetic roofing materials may require less labor and equipment.) If possible, build material reserves.
  • Use technology. Software can help you streamline and better manage each part of the process, from project planning to payment tracking. Use construction management software for scheduling, organizing and storing documents, and more. Consider the role digital and other technologies can play in saving time and money. Drones, wearable sensors, self-driving vehicles, and more are predicted to have huge impacts on productivity and value.

On every project, it’s a good idea to consult with your legal and financial advisors to mitigate risks. RBT CPAs is proud to serve construction businesses throughout the Hudson Valley and beyond. For financial and tax advice, give us a call.

Do You Know About These Finance Resources Available through the State?

Do You Know About These Finance Resources Available through the State?

New York State’s Fiscal Stress Monitoring System helps counties, cities, towns, villages, and school districts check vital signs for fiscal health and, when appropriate, proactively take action to address and fix issues. Take a moment to get acquainted (or reacquainted) with the tools and resources the state offers to monitor, act (when appropriate), and maintain strong fiscal health.

The Fiscal Stress Monitoring System was created by New York State Comptroller Thomas P DiNapoli in 2012 and is a lot like an annual physical. During an annual physical, a doctor collects information about certain key health factors; tracks and compares that information year to year; and, using baseline data, either helps the individual fix any issues or refers him/her for more specialized care to manage a condition. The state’s Fiscal Stress Monitoring System works much the same way. It provides an early warning to local officials and residents to indicate when action is needed to manage potential risks to finances, property taxes, and essential services.

Based on financial factors, fiscal stress scores are assigned and reported publicly. Financial indicators include year-end fund balance, short-term cash-flow borrowing, cash position and operating deficit patterns.

Stress scores using data from Annual Financial Reports for fiscal years ending 2021 have started to be reported via a press release and lists posted on the comptroller’s website. (School district scores were released in January.) A second, separate analysis of environmental factors using US Census Bureau data provides insight into a local government’s or school district’s economic health and other challenges.

In addition to these reports, insights from the Office of the Comptroller can highlight points of focus for local municipalities. As noted in a recent press release, “The financial landscape for many local governments has improved with the infusion of federal aid and stronger economic activity,” DiNapoli said. “The relief funds are temporary, so it is critical that local communities make changes, including carefully managing debt and engaging in long-term planning, that help improve their financial outlook for years down the road.”

Beyond the fiscal stress report, the Office of the Comptroller provides:

  • A self-assessment tool – which can be especially helpful during budget planning processes – so local officials can determine stress scores using current and future financial assumptions.
  • Numerous live and on-demand webinars on a variety of topics from budgeting, financial planning, and procurement to capital planning, audits, taxes, and more.
  • Reference guides, research reports, and other resources.
  • A Financial Toolkit, which provides targeted information, tools, and training to address potential challenges and issues arising from the COVID-19 pandemic.
  • New York Open Book, a site that tracks state and local spending and makes public financial records, state contracts, and other commonly requested data.

If you prefer more personalized guidance on finance and accounting, remember, RBT CPAs is available to help. We’re one of the Hudson Valley’s leading accounting firms and we have extensive experience working with local governments and school districts. Give us a call.