August 2009


By Councilmember Bill de Blasio, Democrat for Public Advocate

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In this section:

I. Planning for a New Economy
• Local Business Incubators
• Summit NYC

II. Assisting Minority & Women Owned Business Enterprises
• Centralizing M/WBE Programs
• M/WBE Procurement Advocacy

III. Providing Quality Job Training
• Program Evaluation
• Job Training to Reflect the Job Market

IV. Developing Green Jobs for New York City
• Renewable Goals for New York City
• Municipal Solar Financing
• Financing Home and Building Retrofits

V.   Exercising the Public Advocate’s Role on NYCERS
•    Economically Targeted Investments
•    Emerging Managers
•    Environmental, Social and Governance Decision-making

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New York City is experiencing its most serious recession in decades. Unemployment has risen to
9.5 percent, now matching the national average, and the City's Independent Budget Office
forecasts that New York City will lose over a quarter of a million jobs from the third quarter of
2008 to the middle of 2010.1 While we cannot know the exact pace and shape of our eventual
recovery, it is clear that New York City needs a new economic approach that creates and sustains
good jobs, draws heavily on our City’s unique, existing assets, and diversifies our economy—
freeing us from our reliance on Wall Street. The Public Advocate is a citywide elected official
with a seat on the City’s largest pension board, the power to introduce legislation, the
responsibility of overseeing the performance of City agencies, and a seat on the Independent
Budget Office Advisory Board. I will be a Public Advocate who plays a key role in charting the
course of the City’s economic recovery, and, in turn, serves as a leader in creating the living
wage jobs that New York City’s residents need and deserve.

I. Planni ng for a New Economy

Before the recession, Wall Street accounted for approximately five percent of the jobs in New
York City, and represented approximately 23 percent of the city’s salary revenue.2 In addition,
from 2003 to 2006, the creation of each securities job in New York City resulted in the creation
of two additional jobs in other industries.3

Our City, and Wall Street in particular, stands at the epicenter of the global economic crisis.
While the recovery of our financial sector is important to New York City, we cannot rely as
heavily on Wall Street to continue being our driving economic force, but rather must adapt to the
new reality in New York City and diversify our economy. Our government should work
proactively to generate economic opportunities and living wage jobs in fields that are growing,
sustainable, and supported by New York City’s unique combination of academic, scientific,
cultural and technological assets.

•   Local Business Incubators: I will work to create opportunities for developing businesses to
    establish themselves and grow in New York City. I will collaborate with relevant City
    agencies4 to conduct an inventory of public properties — City, State and Federal — to

  New York City Independent Budget Office, “Fiscal Brief: Analysis of the Mayor’s Executive Budget for 2010,”
May 2009, 2.
  New York State Comptroller, “The Securities Industry in New York City,” October 2007, 1.
  Ibid at 8.
  Such agencies would include, at a minimum, the Department of Buildings, the Economic Development
Corporation, and the Department of Small Business Services.

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    identify unused and under-utilized space that could be transformed into affordable business
    incubator space. Access to affordable space will help developing companies and
    entrepreneurs overcome one of the frequent challenges of doing business in New York City
    — the high cost of rent. Encouraging business development in growth industries will
    contribute to long-term local economic growth and create jobs in City neighborhoods.5 The
    Downtown Brooklyn Partnership, for example, has a proposal to turn 370 Jay Street in
    Brooklyn (an un-used, ill-maintained building that is owned by the MTA) into affordable
    incubator space for small, developing businesses. This would not only transform this building
    into a source of local economic activity and jobs for Downtown Brooklyn, especially in light
    of its proximity to a number of technological colleges and universities, but it would provide
    critical funds for growing businesses and generate revenue for the MTA.6

•   Summit NYC: While the New York City economy has suffered tremendous losses since
    2008, we are fortunate to have a strong, diverse array of assets that will serve as the building
    blocks for our eventual recovery. As Public Advocate, I will use my office to encourage
    economic recovery by convening Summit NYC, a series of regular meetings with leaders in a
    wide variety of fields including our cultural, academic, business, healthcare, biotech,
    medicine and entertainment sectors. The meetings are intended to:

        o Help ensure that our City’s unique strengths are being incorporated into our economic
          recovery in a way that facilitates coordination among different sectors and with
          government, and maximizes their potential to flourish in New York City.

        o Generate a City, State and Federal policy action plan for executing this multi-faceted
          approach to economic recovery. The Public Advocate can play an active role in
          advancing the agenda by utilizing the legislative process, organizing communities,
          and conducting oversight.

        o Recommend policies and practical steps to support existing City industries that New
          York City cannot afford to lose, such as cultural institutions, which create an
          estimated 194,000 jobs annually statewide.7

        o Recommend infrastructure improvements that would not only create short term and
          long term jobs, but would make New York City more hospitable for businesses in the
          future. For example, construction of the Cross Harbor Tunnel from Bay Ridge,

  According to member incubators of the National Business Incubation Association, 87 percent of companies that
are graduates of their incubators are still in business and 84 percent of their incubator graduates remain in their
original community. The National Business Incubation Association, “Business Incubation FAQ,” August 4, 2009.
  Downtown Brooklyn Partnership, “Plea to the MTA: Give Jay Street Station a new lease on life,” October 23,
2008. This initiative would be in line with recent City initiatives,
including the Mayor’s announcement this July to create affordable working space for thousands of employees in the
new media sector.
  Jones, Gregory, “Arts, tourism advocates fight budget cuts,” Legislative Gazette, February 9, 2009.

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             Brooklyn to Bayonne, New Jersey would provide a much needed method for
             efficiently transporting goods in and out of New York City.

II. Assisting Minority & Women Owned Business Enterprises

Minority and Women Owned Business Enterprises (M/WBE) are vastly underrepresented when
it comes to participation in City contracting. According to figures cited by the Mayor, there are
nearly 200,000 small businesses in New York City, nearly one-third of businesses in the City are
owned and operated by minorities, and over one-quarter are owned and operated by women.8 Yet
the City has only certified approximately 2,200 firms and awarded a total of approximately $900
million in contracts since the implementation of the City’s M/WBE program in 2005.9 New York
City spends approximately $15 billion on procurement annually.10

I believe that by setting ambitious goals and making a series of improvements to better support
M/WBEs, we can more than double the number of certified firms and exceed the M/WBE
program participation goals11 by the end of 2010. My office will work with the Department of
Small Business Services (SBS) to assist qualified M/WBE firms in winning City contracts by
improving M/WBE outreach and agency coordination, and by launching a sustained advocacy
effort to help level the contracting playing field.

•   Centralizing M/WBE Programs: I will help increase the number of certified M/WBE firms
    applying for City contracts by partnering with SBS to improve outreach and coordination
    among the multiple agencies that certify M/WBE firms. As Public Advocate, I will work
    with SBS and other governmental agencies to advance the following goals:

        o Create a reciprocity program and uniform standards to allow M/WBE firms that are
          already certified with at least one governmental agency to become automatically
          certified with other agencies and informed of all contracting opportunities for which
          they might qualify.12

  City of New York, News from the Blue Room, “Mayor Bloomberg Signs Executive Order to Increase Amount of
Minority and Women Owned Businesses Earning City Contracts,” September 9, 2005.
  City of New York, News from the Blue Room, “Mayor Bloomberg Announces Minority- And Women-Owned
Business Enterprise Program Improvements at Third Annual Citywide Procurement Fair,” July 21, 2009.
   New York City Council Contracts Committee, “M/WBE Compliance,” June 24, 2008.
   There are at least seven agencies that certify M/WBE firms in the New York City metropolitan area, yet there is
no reciprocity among them – firms need to apply for certification separately. New York City Economic
Development Corporation, “Opportunity MWD, Advancing Minority, Women and Disadvantaged Businesses.”

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        o Compile and distribute a directory of M/WBE firms that are certified with any
          government entity to every agency (City, State and Federal) in the metropolitan area,
          as well as to existing government contractors who may have opportunities to
          subcontract with M/WBE firms.13 Agencies would be encouraged to include
          evaluations of their experiences with M/WBE firms in the directory to increase the
          profile of M/WBE vendors with proven track records of solid performance.

        o Ensure that M/WBE firms have timely access to information regarding opportunities
          for government support, including recent initiatives to increase lending to small
          businesses by the Federal Small Business Administration.14

•    M/WBE Procurement Advocacy: I will help qualified M/WBE firms to compete effectively
     for City contracts by advocating for State legislation allowing a 10 percent price preference.
     The City Council recently passed Resolution 1773-A, which calls on the State to pass
     legislation authorizing New York City to award contracts to minority and women owned
     businesses at a cost premium up to 10 percent above the lowest bid. This legislation would
     provide New York City with a mechanism to help address the disparity that exists between
     availability of qualified M/WBE firms and their utilization by the City. New York City is
     already authorized to exercise a price preference for recycled products that cost up to 10
     percent more than non-recycled products.

III. Providing Quality Job Training

Job-training programs for public assistance recipients should effectively serve participants and
be a smart use of public dollars. Each year, well over a hundred thousand New Yorkers applying
for public assistance are referred to the Back to Work program, one of the City’s job placement
and training programs operated by the Human Resources Administration (HRA).15 New York
City is on track to spend approximately $134.4 million over three years on the Back to Work
program, which is designed to provide employment readiness training, job placement services
and vocational training to public assistance recipients.16

In response to concerns raised by program participants and advocates, my City Council office
requested that the IBO conduct an independent evaluation of the program. The evaluation found
that in 2008, less than 10 percent of participants who completed employment plans found and

   The City currently maintains an online directory of M/WBEs that is limited to firms that are certified with the
City’s program.
   “The SBA’s Karen Mills on Thawing Credit,” Business Week, July 23, 2009.
   The number of public assistance clients referred to the Back to Work program totaled 121,143 in 2007, 143,311 in
2008, and 82,895 in the first six months of fiscal year 2009. Letter from the Independent Budget Office to
Councilmember Bill de Blasio, April 23, 2009.

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retained employment for at least 180 days.17 From this data, it is clear that New York City has
been referring thousands upon thousands of unemployed New Yorkers to costly programs that
ultimately do little to assist them. It is time to stop the public assistance merry-go-round that
guides New Yorkers into job training programs and then leads them right back to unemployment
and public assistance.

As Public Advocate, I will use my role with the IBO to improve job training programs for public
assistance recipients, starting with the Back to Work Program.

•    Program Evaluation: To determine program effectiveness, we need the right data. I will
     work with the IBO to initiate a review of job placement and training contracts to determine
     what additional data should be tracked and reported to ensure that the City has all the
     necessary information to properly evaluate the cost effectiveness of contracts. For example:

        o Job placement and training contracts must include reporting requirements that will
          allow for thorough and precise program evaluation. For example, two important
          measures of a vendor's effectiveness are a) for every dollar spent on the contract, how
          many job placements are made; and b) for every dollar spent on the contract, how
          many dollars are generated in salaries earned by program participants.

        o Our City should only pay the job placement and training vendors who achieve good
          results. I will work with the IBO to analyze the data described above, and determine
          the long-term cost effectiveness of City-contracted job placement vendors.

•    Job Training to Reflect the Job Market: I will work with the IBO and HRA to ensure that,
     when awarding contracts to job placement and training vendors, HRA considers a vendor’s
     capacity to match job training and placement programs with sectors of the local economy that
     are growing or have high growth potential.

IV. Developing Gree n Jobs for New York City

In the face of growing concern about climate change and the economic recession, New York City
should take action to jumpstart a local renewable energy economy. While New York State has
set a goal of producing 25 percent of its energy from renewable sources by 2013, there is no
mandated goal for New York City.18 In fact, while New York City residents help support a
significant portion of the State's renewable energy activity through our utility bills, we see far too
little of the economic benefits. The vast majority of New York State's renewable energy activity,
and the jobs that come with it, are concentrated upstate. New York City has tremendous

  New York State Energy Research and Development Authority, “The New York Renewable Portfolio Standard.”

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untapped green energy potential—we should be leading the rest of the State, not playing catch-

•    Renewable Goals for New York City: Through the right combination of energy efficiency
     improvements and renewable energy policies, we can raise New York City’s renewable
     energy portfolio to at least 25 percent over the next ten years. I will collaborate with industry,
     labor, environmental groups, and elected officials to advance State legislation mandating
     ambitious renewable energy targets for solar and wind energy production in New York City.
     Requiring utilities to generate a portion of energy from offshore wind, for example, would
     not only green our energy sources, but would bring economic benefits to New York City
     through the installation and maintenance jobs needed to operate large-scale offshore wind
     energy facilities.20

•    Municipal Solar Financing: I will work to make solar panels accessible to homeowners and
     entrepreneurs. Many New Yorkers want to outfit their homes with solar panels, and
     potentially sell their renewable energy to utility companies, but the purchase and installation
     costs are often prohibitively expensive. A municipal financing program would allow property
     owners to finance renewable energy installation using loans that are gradually paid back
     through property taxes.21 I will build a coalition of homeowners, environmental advocates,
     and legislators to advance State legislation authorizing New York City to create a municipal
     financing program for renewable energy. Municipal financing could not only help
     homeowners save thousands, but could create a host of living wage green collar jobs and
     sustainable business opportunities that support this developing industry.

•    Financing Home and Building Retrofits: I will use my position on the New York City
     Employee Retirement System (NYCERS) Board to research and identify promising
     investment opportunities in large-scale commercial and residential energy retrofit funds.22
     New York City has the potential to be one of the greenest cities in America, but our
     concentration of energy inefficient buildings holds us back. In New York City, buildings
     produce nearly 80 percent of our greenhouse gas emissions, compared to a national average
     of approximately 32 percent.23 A green retrofit program that provides loans for homes and

   The Center for Sustainable Energy at Bronx Community College, “New York City’s Solar Energy Future,”
January 2006.
   Mandating wind energy targets could aid preliminary efforts to develop what could potentially be the nation’s
largest offshore wind farm right here in New York City. New York Power Authority, “The Long Island – New York
City Offshore Wind Collaborative Releases Request for Information,” July 1, 2009.
   Cities across California are investing in municipal financing programs, and at least half a dozen other states have
begun taking legislative steps that will allow them to implement such programs. Even after the cost of the
investment, homeowners in California have already experienced thousands in utility savings. See Kaufman, Leslie,
“Harnessing the Sun, With Help From Cities,” New York Times, March 14, 2009.
   The Public Advocate sits on the Board of Trustees of NYCERS and casts one vote. New York City Charter § 13.
As a fiduciary of the pension fund with a responsibility to pension holders, I will ensure that NYCERS only
considers investments that are expected to provide a competitive return to investors.
   Cardwell, Diane, “Buildings Called Key Source of City’s Greenhouse Gases,” New York Times, April 11, 2007.

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     buildings could improve New York City’s environmental footprint, create thousands of living
     wage green collar jobs, and reduce utility costs for residents.

V. Exercising the Public Advocate’s Role on NYCERS

Like many investors, including New York City's other public employee pension funds and
pension funds across the country, NYCERS has sustained billions of dollars in losses since the
start of the recession. We must identify reliable investment opportunities for NYCERS that will
allow the fund to fulfill its obligation to pension holders without straining the New York City
budget. As a voting NYCERS board member, the Public Advocate can play an important role in
this process. NYCERS has over 300,000 active members and retirees who depend on the fund,
which has an estimated value of over $30 billion.

•    Economically Targeted Investments: I will ensure that NYCERS considers a broad range
     of Economically Targeted Investments (ETI) that produce competitive returns for pension
     holders, as well as an ancillary benefit for New York City — a “double bottom line.” This
     could include increasing investments in funds that NYCERS has found to be successful, such
     as the AFL-CIO Housing Investment Trust, and new ETIs that support community-based
     investing, such as funds that supply viable loans for small businesses or home energy retrofit

•    Emerging Managers: I will ensure that NYCERS proactively considers investing funds with
     emerging managers, including the many who operate smaller, minority and women owned
     investment firms. Utilizing a wide array of capable fund managers will help to ensure that
     NYCERS has access to top talent and practices diverse investment strategies. Analyses have
     shown that many emerging managers out-performed the larger, more established financial
     managers during this current period of economic crisis.24

•    Environmental, Social and Governance Decision-making: As a member of the NYCERS
     Board, I will employ an investment decision-making evaluation process that measures a
     company’s environmental, social and governance (ESG) practices. These factors are
     important because they affect a portfolio’s long-term growth and profitability and, as a result,
     its investment return for NYCERS pension holders.25 For example, NYCERS should
     consider a company’s carbon footprint when making investment decisions. While we cannot
     know exactly what type of climate change legislation will be passed at the Federal level, it is
     likely and expected that companies with lower carbon footprints and the ability to further
     reduce their greenhouse gas emissions will have a competitive advantage in the marketplace.

   Urbani, Peter “Emerging Hedge Fund Managers Outperform Older Funds,” FINalternatives Hedge Fund and
Private Equity News, February 26, 2009.
   Dixon, David, “Bringing ESG considerations into the investment process,” Money Management, April 24, 2009.

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