Empire State Development Corporation
| Company type | Public-benefit corporation |
|---|---|
| Industry | Economic development |
| Predecessor | New York State Urban Development Corporation, New York Job Development Authority, Department of Economic Development, Science and Technology Foundation |
| Founded | 1995 |
| Headquarters | New York , United States |
Key people | Kenneth Adams (President & CEO), Julie Shimer (Chair) |
| Products | Loans, grants, tax incentives, real estate projects, promotional activities, economic development programs |
Number of employees | 355 (2017) |
Empire State Development (ESD) serves as the overarching entity for New York's two primary public-benefit economic development corporations: the New York State Urban Development Corporation (UDC) and the New York Job Development Authority (JDA). The New York State Department of Economic Development (DED) functions as a division within ESD.
The core objective of ESD is to stimulate New York's economic growth by fostering business investments and generating employment opportunities. It aids local communities through a variety of programs, including loans, grants, tax incentives, real estate projects, promotional activities, and other supportive services.
History
In 1941, the Division of Commerce was formed by integrating several state bureaus along with the Bureau of Industry. This entity was succeeded by the Department of Commerce in 1944. The New York State Urban Development Corporation (UDC) came into existence in 1968 with a mission centered on statewide urban renewal and housing development. By 1975, UDC broadened its scope to encompass general economic development. The Department of Economic Development (DED) was established in 1987, and in 1995, the responsibilities of DED, UDC, the Job Development Authority (JDA), and the Science and Technology Foundation (STF) were unified under the Empire State Development (ESD) brand. The STF was dissolved in 1999, and NYSTAR merged into DED in 2011.
Initially, UDC spearheaded major publicly supported housing initiatives, financing nearly all state-subsidized housing projects since its inception in 1968. However, following fiscal challenges in the mid-1970s, UDC shifted its emphasis from aggressive housing construction to wider economic development efforts. These included significant urban projects such as the Jacob K. Javits Convention Center, renovations at the Apollo Theater, Battery Park City development, Roosevelt Island projects, and revitalization programs in Niagara Falls and Manhattan’s 42nd Street corridor.
Governors have often relied on UDC/ESD to advance large-scale projects that bypass conventional legislative oversight. For instance, Governor Mario Cuomo expanded the state’s prison infrastructure through bond financing despite voter opposition. After the events of September 11th, Governor George Pataki managed approximately $20 billion in federal recovery funds via subsidiaries like the Lower Manhattan Development Corporation.
A 2006 audit uncovered that ESD maintained more subsidiaries than officially disclosed, many of which were inactive. In response, ESD committed to eliminating these dormant entities. Under Governor Eliot Spitzer in 2007, an Upstate office was established in Buffalo with distinct leadership for Upstate and Downstate regions to address their unique economic conditions. Governor David Paterson reversed this separation in 2008 to encourage a cohesive statewide economic approach.
In 2011, Governor Andrew Cuomo named Kenneth Adams as President & CEO of ESD and Commissioner of DED; later that year Julie Shimer was appointed Chair.
State oversight of projects within New York City has frequently led to friction between municipal and state officials due to ESD’s exemption from city zoning regulations and its substantial impact on neighborhoods. Developments such as the Harlem State Office Building encountered community resistance. These disputes partly motivated the rebranding of UDC to Empire State Development in 1995.
During the COVID-19 crisis, ESD played a pivotal role in defining essential businesses under state executive mandates. This involvement attracted criticism for excluding religious institutions from essential status while including other sectors deemed non-essential. Former ESD President Avi Schick publicly asserted that ESD exceeded its jurisdiction by deciding which religious activities qualified as essential.
Structure
Since 1995, Empire State Development (ESD) has functioned as an operational merger of four distinct entities:
- Urban Development Corporation (UDC), operating as Empire State Development
- In 2017, UDC recorded operating costs totaling $1.282 billion, held $12.895 billion in outstanding debt, and employed 351 personnel.
- Department of Economic Development (DED)
- New York Job Development Authority (JDA), also doing business as Empire State Development
- JDA’s 2017 figures included $2.96 million in operating expenses, $10.068 billion in outstanding debt, and a staff of 4.
- Science and Technology Foundation (STF)
Although these agencies have been programmatically unified under ESD, they legally remain distinct entities. The commissioner of the DED serves as chair for the boards of UDC, JDA, and STF, which continue to maintain independent operations.
UDC functions through various subsidiaries, each governed by its own board structure. As of 2015, nine active subsidiaries were:
- Atlantic Yards Community Development Corporation (AYCDC)
- Brooklyn Bridge Park Development Corporation (BBPDC)
- Convention Center Development Corporation (CCDC)
- Erie Canal Harbor Development Corporation (ECHDC)
- Harlem Community Development Corporation (HCDC)
- Lower Manhattan Development Corporation (LMDC)
- Moynihan Station Development Corporation (MSDC)
- Queens West Development Corporation (QWDC)
- USA Niagara Development Corporation (USAN)
In addition, ESD oversees more than 120 subsidiaries that are legally extant but currently inactive.
The New York State Foundation for Science, Technology and Innovation—formerly known as NYSTAR—is recognized as a public benefit corporation tasked with advancing science and technology initiatives. Although now integrated into ESD, NYSTAR was omitted from the 2018 Authorities Budget Office report, implying it may have been dissolved or is no longer reporting.
Operations
The UDC possesses authority to issue bonds and notes, provide loans and tax incentives, acquire private property through eminent domain, establish subsidiaries, and supersede local regulations such as zoning ordinances. Similar to other New York state public-benefit corporations, it issues bonds without requiring voter approval, thereby circumventing constitutional restrictions at the state level. As of May 2015, UDC’s outstanding debt was reported at $11 billion.
By October 2015, key initiatives underway included:
- Atlantic Yards Project
- Aqueduct Race Track Civic Project
- Belmont Park Redevelopment Study
- Buffalo Billion Initiative
- City-by-City Projects
- Columbia University Manhattanville Project
- Midtown Rising (Rochester)
- Radisson Community Development
- Victoria Theater Redevelopment in Harlem
Procurement opportunities related to these projects are published through the Department of Economic Development’s New York State Contract Reporter.
See also
- Dormitory Authority of the State of New York
- I Love New York (I ❤ NY)
- New York Local Government Assistance Corporation
- New York State Environmental Facilities Corporation
- New York State Housing Finance Agency
- Municipal Assistance Corporation
- State University Construction Fund
References
External links
- Urban Development Corporation of New York State within the New York Codes, Rules and Regulations
- Economic Development Department listed in the NYCRR
- Job Development Authority of New York found in the NYCRR
- Science and Technology Foundation of New York State included in the NYCRR
- New York State Contract Reporter website
- Empire State Development data on Open NY platform
- Profile of Empire State Development Corporation on USAspending.gov