Hochul on Amazon’s demise, Buffalo’s rebound and championing child care

Lt. Gov. Kathy Hochul is a lifelong Western New Yorker who has been involved in its politics for decades. She has watched the region, along with other upstate areas, get battered economically by deindustrialization and sprawl, as businesses and more affluent residents of upstate cities have left for the suburbs and for sunnier climes.

Throughout her career, she has worked to combat that decline. Years ago as a Hamburg town board member, she advocated for mom-and-pop retailers against Walmart. She went on to serve as Erie County clerk and a member of Congress, before narrowly losing her bid for reelection in 2012 and joining Gov. Andrew Cuomo’s ticket in 2014. In her current role, Hochul – who still lives in the Buffalo area – has upstate economic development as part of her portfolio.

On a recent trip to Buffalo, City & State’s Ben Adler sat down with Hochul to discuss economic development policy, the prospects for Western New York and Hochul’s desire to see Equal Rights Amendment added to the state constitution. The questions and answers have been edited and condensed for conciseness and clarity.

Are you from Buffalo originally?

I was born in Lackawanna, near the steel plant where my father and grandfather worked and then moved to Woodlawn. I lived in Woodlawn for a bit, which is still a rough little town, and then moved to Hamburg and that’s where I ran for all my offices, town board 25 years ago, county clerk, and then Congress was actually outside that area. If I had Buffalo in my district, I’d still be in (the House). I had the most Republican district in the state. I had all the rural areas between here and the Finger Lakes.

You’ve worked a lot on economic development in Western New York. Some people say state investments have had some beneficial effects but have not had a great return on investment. How do you respond?

Nobody who lives here would agree with that assessment. There has been a dramatic psychological shift. It’s not how you quantify the number of buildings going up, it’s how people believe in their community again. I’m really proud of the fact that people actually believe that Buffalo is on the rise now and that’s after 40 years of hemorrhaging people, hemorrhaging jobs, hemorrhaging capital. Young people was our greatest export. Now we have millennials. What is it? Up 21 percent in the last decade. That doesn’t happen anywhere else. So those are the people that we’re building our future on: the refugee community, the young people coming here for startups, the ones who are migrating from Brooklyn because they actually want to be able to buy a house one day. And they’re creating this vitality.

The Buffalo Billion has become a bit controversial because of the corruption.

Those were the actions of a small handful of bad people who abused their positions and indeed the Buffalo Billion has been guided primarily under the auspices of the Regional Economic Development Council, but what Dr. Kaloyeros had his hands on was something that the governor had inherited. He had been doing this previously with some governors and had his own sort of offline economic development fiefdom.

A lot of the jobs created recently in the Buffalo area are in services, and they’re not as high-paying as the manufacturing jobs that were lost.
I cut a ribbon Friday for a company, which is run by a graduate of the University of Buffalo. He works for a company where they do very sophisticated forensic analysis of financial institutions to determine whether or not they’re in violation of anti-money laundering laws. There is probably not a job with them that’s under $50, 60, 70,000. I was just out at Geico (in Amherst). Geico was going to come here with 1,000 jobs in 2004. They now have over 3,000. And I spoke to literally hundreds of them. Those people are happy. These are people that had no opportunities before and they’re now working at a job that they’re proud of and they have opportunities for advancement, higher salaries. So we get the whole gamut.

One example that I’ll never forget is when I went to a welding program, BOCES, and these were high school kids who had been in a two-year welding program. Every one of them was guaranteed a job and there’s a wait list. Every one of them had a job offer. And they were all going to start making $60-70,000 a year with a high school degree. I looked at the class of kids and there were some girls, they’re all flirting, and I said, “If this little girl marries some classmate of hers, they’re making $140,000 in Buffalo. They can pay cash for a house. They can get Buffalo Bills season tickets. They can go to the theater.” So you don’t need the same income to have a phenomenal quality of life here and I think that’s an important point to make.

This is one area I spend a lot of my time thinking about – how to get underserved communities involved, how to get women more in these male-dominated fields.

In New York City, there was a lot of opposition from some on the left, including elected officials in New York City, to the subsidies that Amazon would qualify for, mostly through the Excelsior tax credit program. What’s your response to that?

Someone’s criticizing assisting companies creating jobs in the state of New York?

Yeah, because it’s corporate welfare.

They’d rather they go somewhere else? That’s the alternative.

They would argue that a lot of these companies would probably locate here anyway.

And they know that? Last time I checked, Amazon now is expanding in Washington, D.C., where my children live and they’re so excited that their properties are going through the roof because they live near Amazon. I understand they’re expanding in Nashville. The Nashville mayor could not be happier with New York City because they drove them away. And so those jobs are going somewhere and we lost them. And, I’ll tell you, I was asked about this by the mayor of Watertown and the mayor of Oswego, both of them saying, we were really counting on those jobs in New York City. It’s not only about downstate, because they knew there was a ripple effect. They knew there were suppliers and businesses upstate that they figured they’re somehow going to be a part of this and Amazon had already been talking to people elsewhere. This was not just a New York City loss. It hurt our whole state.

Now you want to talk about those tax credits, other states were putting far more money on the table to lure Amazon, OK? What we were doing was reasonable and fair and the reason it sounded like a lot of money, $1.7 billion from the state of New York, because we’ve never had an opportunity in our history to have that many jobs come at one time. … We are trying to recover from this hit because it hurts us reputationally and I’m trying to lure other businesses. This is one of the things I do a lot of – trying to convince other businesses to either come here from other states, or the ones who are here, to expand.

Gov. Andrew Cuomo said we’re up against some long-term trends and disadvantages when we’re dealing with upstate economic development. For example, it’s cold.

It is so true. I was in Watertown yesterday and everybody opens up saying it has been a long brutal winter. When you’re a senior citizen, trying to get to a doctor’s appointment and it is snowing out, it can be tough. We’re increasing the number of millenials upstate and I think that’s a very positive dynamic. I think millennials like to skate. They like to ski. I’m not a millennial, but I take hikes in the woods in the wintertime.

If an executive says, “I could go to the Research Triangle in North Carolina and it’s a lot warmer and land’s just as cheap.” How do you make the case that they should go here, that this is better?

I was just up at Yahoo (in Lockport). They’re continuing to expand here. They could’ve gone anywhere in the country and they love the fact that we have low-cost power because, you know, electricity is very important for cooling down their systems. So the cost of air conditioning is so high for these companies, so the cost would be way too high in a hotter climate. These huge data centers do well here.

Another issue, which is not a Buffalo issue, it’s a state issue, it’s a national issue – it’s the cost of child care. And our administration, the governor and I, are trying to figure out ways that that can be less of a barrier, particularly for women being elevated, first of all, just to be able to work at all and also upward growth in their organization. You look at it from two ends, it costs $26,000 for child care if you have a toddler and a baby. That is higher than college. Child care is higher than college now and it’s right up there with rent when you look at the monthly payments. And we’ve decided, this is no longer your family’s problem. This is our state’s problem, because if we don’t allow women to reach their full economic potential, then we’re held back as a state, so I’m excited about how we’re framing that.

What are the policies?

We have a task force that just was launched so we’re going around the state, asking these questions and I believe– you know we don’t have an answer yet –but I believe there should be incentives created for businesses and we have to figure out what that looks like. But I was invited to go to a company in the North Country, a very large tech company, GlobalFoundries. (Editor's note: It's actually in the Capital Region.) And they asked me to come and have a conversation about how to encourage more women to come to tech jobs a couple of years ago, and I said, “You’re a big company, got a lot of space. Do you have an onsite child care center? You do that and you’ll have women banging down the door, and men who want to see their kids too.” (Child care) should not be heavily weighted toward women, but unfortunately it is. It should be equal. Then we’re also talking about smaller companies. Can they form a consortium with other businesses and create a common center that they can share? I work on economic development, workplace development, child care.

Those are your areas of focus?

Every day I focus on a lot of things, but these are the ones that I’m leaning hard into this session as we roll that into the whole women’s empowerment agenda and women’s justice agenda that we’ve been working on. Even the Equal Rights Amendment, which people say, “Well, why do we need that?” You say one word: Donald Trump. I need to have more protections because the Supreme Court scares the hell out of me. Back in 1972, that 10-year period from ‘72-’82 when they needed 38 states to ratify and they only got to 35, New York was one of those states. We’re simply trying to get the same version in the state of New York so you can’t have discrimination on the basis of gender.

Added to the state constitution?

Yes, state constitution, and I think we can get it through.

You’re on the road a lot it sounds like. That must be exhausting.

I was already in Suffolk and Nassau and Manhattan this morning. I woke up and took the 5:30 flight.

And you flew back in the same day?

Yeah, because I wanted to make the ribbon cutting at 3:30 of this housing project on the West Side. You know it’s a burned-out building that’s now coming back. I hate to miss anything. It drives my wonderful staff nuts but they keep up with me. We have something called #howshedoesit. I think we’re posting tomorrow all the stuff I carry in my car. People always say, how do you get all that done? And that’s not the state plane. Imagine how productive I’d be if I had a state plane.

Correction: GlobalFoundries is in the Capital Region, not the North Country.