Establishes a kitchen incubator/shared-use kitchen facility program within the urban development corporation; provides grant funding to local development corporations, municipalities, educational institutions and not-for-profit entities for the development or expansion of kitchen incubator/shared-use kitchen facilities which make available services such as food production, technical assistance, business management and marketing, distribution, storage and retailing assistance, particularly in economically distressed areas.
TITLE OF BILL: An act to amend chapter 174 of the laws of 1968 constituting the New York state urban development corporation act, in relation to kitchen incubator/shared-use kitchen facilities
PURPOSE: Provide start-up and expansion funding for not-for-profit sponsors of small-scale food processing facilities.
SUMMARY OF PROVISIONS: Would add a new section 16-v to chapter 174 of the laws of 1968 constituting the NYS Urban Development Corporation Act creating a kitchen incubator/shared-use kitchen facility grant program.
Section 1. Subdivision (1) defines these facilities as government licensed food processing or preparation facilities, sponsored by notfor-profits or government agencies, and used by small emerging food businesses who are either full-time or temporary tenants. The sponsors must provide low-cost space and financing and business support services. Other services, such as technical, production, distribution and sales assistance to tenants, may be provided. The corporation is authorized to award competitive grants to sponsors for construction, rehabilitation, equipment, training, technical assistance and other approved purposes.
Subdivision (2) requires grant applicants to provide management plans for financial self-sufficiency, community needs assessment, and planning for providing assistance described in paragraph (1).
Subdivision (3) allows for one grant per applicant per year, up to $250,000. Preference is given to applicants: from distressed areas or economic development zones; providing a local match; meeting local needs; providing services not offered by local governments or business; providing services and assistance in addition to that required in subdivision one; and, with a plan, developed in cooperation with the Department of Agriculture and Markets, to assist facility businesses with purchasing NYS farm products and promoting the facility to regional farmers.
Section 2. amends paragraph b of subdivision 1 of section 16-m of section 1 of chapter 174 of the laws of 1968 as added by chapter 84 of the laws of 2002 to include kitchen incubator/shared-use kitchen programs in the Economic Development Fund.
JUSTIFICATION: Small businesses provide a significant portion of the jobs, and opportunities for financial success, in our State. This is especially true for distressed communities, rural areas, immigrant populations and women and minorities. In the food sector of our economy many successful enterprises have been started at home or on the farm by individuals who may not have an advanced degree or investment income but have created a great recipe or family dish that could be developed into a profitable product. The growth of these types of businesses is often dependent on affordable, available processing space, financing, manage ment assistance and other services that can nurture an emerging firm. A facility assisting the growth of new or expanding businesses is called an incubator. Kitchen incubators are similar to other types of business incubators; they provide inexpensive space, shared services, access to financing and other support to multiple small enterprises such as specialty food producers, farmers, street vendors, restaurants, caterers, and food service training programs. These food business incubators can be built from scratch but most often are located in buildings, such as abandoned or under used food service facilities, that already have available food preparation space and equipment. The goals of these "kitchen" facilities are to foster entrepreneurship, job development, and community revitalization. An additional goal is improving local farm sustainability by providing an outlet for farmers to sell, or add value themselves, to their farm products. This bill would provide seed funding for communities to establish facilities that provide opportunities for all segments of our society to become food business owners. New business owners create jobs for the surrounding area. The facility could also participate in workforce training and development. The proposed funding for these facilities would be targeted and carefully allocated. Program sponsors would be required to develop a facility that is based on a sound plan that analyzes community needs, and ensures fiscal responsibility. The State's economic development efforts currently focus financial assistance to large companies, however, major food processors have virtually disappeared from New York. Creating a program for smallscale food businesses will help reverse this trend, benefiting local economies, workers and farmers.
FISCAL IMPLICATIONS: Subject to state appropriations.
REGULATION IMPACT: State regulations establishing grant application requirements may be needed.
EFFECTIVE DATE: Immediately, with provisions.
STATE OF NEW YORK ________________________________________________________________________ 3144 2013-2014 Regular Sessions IN SENATE January 30, 2013 ___________Introduced by Sen. KRUEGER -- read twice and ordered printed, and when printed to be committed to the Committee on Corporations, Authorities and Commissions AN ACT to amend chapter 174 of the laws of 1968 constituting the New York state urban development corporation act, in relation to kitchen incubator/shared-use kitchen facilities THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Section 1 of chapter 174 of the laws of 1968, constituting the New York state urban development corporation act, is amended by adding a new section 16-v to read as follows: S 16-V. SMALL BUSINESS KITCHEN INCUBATOR/SHARED-USE KITCHEN PROGRAM. 1. THERE IS HEREBY ESTABLISHED WITHIN THE CORPORATION A SMALL BUSINESS KITCHEN INCUBATOR/SHARED-USE KITCHEN PROGRAM. THE CORPORATION IS AUTHOR- IZED WITHIN AVAILABLE APPROPRIATIONS IN THE EMPIRE STATE ECONOMIC DEVEL- OPMENT FUND ESTABLISHED PURSUANT TO SECTION 16-I OF THIS ACT, TO AWARD GRANTS, ON A COMPETITIVE BASIS IN RESPONSE TO REQUEST-FOR-PROPOSALS, TO LOCAL DEVELOPMENT CORPORATIONS, MUNICIPALITIES, EDUCATIONAL INSTI- TUTIONS, AND OTHER NOT-FOR-PROFIT ORGANIZATIONS FOR THE COSTS INVOLVED IN STARTING OR EXPANDING A KITCHEN INCUBATOR/SHARED-USE KITCHEN FACILI- TY. THE CORPORATION IS FURTHER AUTHORIZED TO CONTRACT WITH THE COMMIS- SIONER OF AGRICULTURE AND MARKETS, AND SUCH COMMISSIONER IS AUTHORIZED TO CONTRACT WITH THE CORPORATION, TO PREPARE AND ISSUE REQUESTS FOR PROPOSALS, ACCEPT GRANT APPLICATIONS, RECOMMEND THOSE APPLICATIONS THAT BEST MEET ESTABLISHED CRITERIA, TO ESTABLISH CRITERIA AND TO ADMINISTER GRANTS AWARDED UNDER THIS SUBDIVISION. SUCH GRANTS MAY BE USED FOR THE CONSTRUCTION OR REHABILITATION OF SUCH FACILITY, PURCHASE OF EQUIPMENT, TRAINING, TECHNICAL ASSISTANCE, AND OTHER PURPOSES NECESSARY FOR THE SUCCESSFUL DEVELOPMENT OR EXPANSION OF A KITCHEN INCUBATOR/SHARED-USE KITCHEN FACILITY. KITCHEN INCUBATOR/SHARED-USE KITCHEN FACILITIES SHALL BE FOOD PROCESSING OR PREPARATION FACILITIES THAT ARE OPERATED BYEXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD01853-01-3 S. 3144 2
NOT-FOR-PROFIT CORPORATIONS OR GOVERNMENT AGENCIES AND USED PRIMARILY BY SMALL AND EMERGING BUSINESSES, INCLUDING BOTH FULL-TIME FACILITY TENANTS AND BUSINESSES THAT RENT SPACE ON A TEMPORARY BASIS. THEY MUST PROVIDE OR MAKE AVAILABLE FOR FACILITY BUSINESSES: LOW-COST SPACE, BELOW CURRENT MARKET VALUE IN THE AREA THE FACILITY SERVES; AND SUPPORT SERVICES, INCLUDING BUT NOT LIMITED TO, BUSINESS PLANNING, MANAGEMENT ASSISTANCE, FINANCIAL PACKAGING, LINKAGES TO FINANCING SOURCES, AND COORDINATION WITH OTHER SOURCES OF TRAINING AND ASSISTANCE. THEY MAY PROVIDE OR MAKE AVAILABLE FOR FACILITY BUSINESSES, SERVICES SUCH AS FOOD PRODUCTION OR PROCESSING TECHNICAL ASSISTANCE, MARKETING, DISTRIBUTION, PURCHASING, STORAGE, PACKING, INSURANCE, ON-SITE RETAILING OR OTHER SERVICES. 2. PROJECT PLANS. APPLICANTS FOR GRANTS MUST PROVIDE A MANAGEMENT PLAN AND A BUSINESS PLAN FOR OPERATING THE KITCHEN INCUBATOR/SHARED-USE KITCHEN FACILITY WHICH DEMONSTRATES TO THE SATISFACTION OF THE CORPO- RATION: (I) LOCAL BUSINESS INTEREST IN A NEW OR EXPANDED FACILITY, INCLUDING THE FOOD PROCESSING NEEDS OF EXISTING AND POTENTIAL FOOD BUSI- NESSES; (II) THE APPLICANT'S ABILITY TO DELIVER SERVICES AND ASSISTANCE AS DESCRIBED IN SUBDIVISION ONE OF THIS SECTION, INCLUDING A DESCRIPTION OF HOW SUCH ASSISTANCE AND SERVICES WILL BE DELIVERED; (III) WHETHER THE SERVICES PROVIDED TO FACILITY TENANTS WILL BE COVERED BY FEES OR INCLUDED IN THE RENT, AND HOW RENTALS AND/OR FEES WILL BE STRUCTURED; (IV) A POLICY FOR TENANTS' ENTRANCE TO AND EXIT, OR GRADUATION, FROM THE FACILITY; AND, (V) THAT THE FACILITY CAN BE SELF-SUSTAINING AND WILL NOT REQUIRE LONG-TERM STATE OPERATING SUBSIDIES. 3. GRANT CRITERIA. GRANTS AND LOANS MADE BY THE CORPORATION PURSUANT TO THIS SECTION SHALL BE SUBJECT TO THE FOLLOWING LIMITATIONS: A. NO SUCH GRANT SHALL EXCEED TWO HUNDRED FIFTY THOUSAND DOLLARS PER YEAR; AND B. PREFERENCE SHALL BE GIVEN TO APPLICANTS WHICH: (I) MEET HIGHLY DISTRESSED AREA CRITERIA OR WHICH SUPPORT EMPIRE ZONES ESTABLISHED PURSUANT TO ARTICLE 18-B OF THE GENERAL MUNICIPAL LAW; PROVIDE A LOCAL MATCH; MEET A SUBSTANTIAL LOCAL OR REGIONAL NEED; COMPLEMENT LOCAL PROGRAMS OR PROVIDE SERVICES NOT READILY AVAILABLE FROM UNITS OF LOCAL GOVERNMENT OR THE PRIVATE SECTOR; PLAN TO PROVIDE OR MAKE AVAILABLE FOR FACILITY BUSINESSES, SERVICES, INCLUDING BUT NOT LIMITED TO, FOOD PRODUCTION OR PROCESSING TECHNICAL ASSISTANCE, MARKETING, DISTRIBUTION, PURCHASING, STORAGE, PACKAGING, INSURANCE, ON-SITE RETAILING OR OTHER SERVICES; AND (II) HAVE DEVELOPED A PLAN TO ASSIST BUSINESSES PARTIC- IPATING IN THE APPLICANT'S KITCHEN INCUBATOR/SHARED-USE KITCHEN FACILITY WITH PURCHASING NEW YORK STATE AGRICULTURAL PRODUCTS, AND PROMOTING THE FACILITY TO REGIONAL FARMERS. S 2. Paragraph (b) of subdivision 1 of section 16-m of section 1 of chapter 174 of the laws of 1968, constituting the New York state urban development corporation act, as added by section 1 of part N of chapter 84 of the laws of 2002, is amended to read as follows: (b) Loans, loan guarantees, and grants including interest subsidy grants may be provided to municipalities, industrial development agen- cies, not-for-profit corporations or local development corporations for the purpose of developing federal facility sites, urban industrial sites, industrial parks and incubator buildings INCLUDING SMALL BUSINESS KITCHEN INCUBATOR/SHARED-USE KITCHEN FACILITIES; or to undertake prelim- inary planning relating thereto; S 3. This act shall take effect immediately, provided, however, that the amendments to section 16-m of the urban development corporation act made by section two of this act shall not affect the expiration of such section and shall expire and be deemed repealed therewith.