Source: US State of New York
Earlier today, Governor Kathy Hochul participated in Axios’ Fireside Chat with Dan Primack. Axios is an American news website based in Arlington, VA. It was founded in 2014 and launched the following year by former Politico journalists Jim VandeHei, Mike Allen and Roy Schwartz. Axios’ BFD is a half-day event where reporters will convene industry leaders to unpack their hyper-relevant news and trends. This event offers attendees an inside track into some of the biggest topics on investors’ minds.
VIDEO of the event is available on YouTube here and available in TV quality (h.264. mp4) format here.
AUDIO of the Governor’s remarks is available here.
PHOTOS of the event are available on the Governor’s Flickr page.
A rush transcript of the Governor’s remarks is available below:
Dan Primack, Axios: As I’ve said a couple of times from this stage, we are a couple of weeks away from an election, so it felt apropos that we should have an actual politician on stage — not just somebody talking about politics. So please welcome the Governor of New York, Governor Kathy Hochul.
Governor Hochul: An actual politician?
Dan Primack, Axios: An actual politician. Sorry, is that offensive?
Governor Hochul: I prefer an elected official. It sounds a little nicer, but if you have to call me a politician, I’ve been called worse.
Dan Primack, Axios: Alright. So, governor, you’ve said — Governor’s Office says — but you’ve said you want to make New York the most business friendly state in the country. How do you gauge that? What’s your metric for that?
Governor Hochul: Well, sometimes it’s not what you do, it’s what you stop from happening. Like a major tax increase on high net worth people that I was able to, you know, stop in its tracks last year. Because I’m not in the business of driving successful people out of our state, I want to bring them back to the State. And so, it’s also, it’s economic policies, it’s also saying that, you know, “We’re going to break down some barriers for you and we’ll be there with financial incentives.” And we’ll talk about Micron, I presume, but there’s no way Micron was going to build the nation’s largest semiconductor facility — $100 billion of investment, the largest in our history, with 50,000 jobs — if there weren’t incentives from the Biden-Harris Administration. But that just meant that all 50 states could compete. I had to win that war and put $10 billion on the table for that entire industry. So you have to have incentives in place, you have to go after the businesses you want, and now I’m going after the whole supply chain to support Micron and others who are coming. So, it’s very intentional. You don’t say, “We’re in New York. Everybody’s going to come,” because we’re in a competitive race and I’m a very competitive person. So I don’t want to lose that and I’ll do whatever I have to do to make sure people know that we are the place, and I’ll be judged by how many jobs we create. I’m starting off with 50,000 right there, so I’m already ahead of the game.
We’ve also created more manufacturing jobs, stopping a 30 year decline in manufacturing. Now we’re talking about advanced manufacturing. So, we have the evidence to show that in the three years I’ve been governor, really putting the focus on this, we’re seeing results already.
Dan Primack, Axios: How do you, you know — a big part of what you’re working on, and we’ve heard a bunch today about this Empire AI Initiative. And as part of this, you got about $275 million from the State and there’s another $150 million from the private sector. It’s an enormous amount of money. However, it’s also less than 10 percent, say of what OpenAI, a California company, raised in the private sector on its own just two weeks ago. Can companies in New York compete with what’s happening in Silicon Valley when you see — in AI — when you see the enormous amounts of money going into these companies?
Governor Hochul: I’m not competing with the private sector to own AI. My view is — as I announced in my State of the State last January — that whoever owns this next chapter of AI for public good will own everything. So what we have —
Dan Primack, Axios: What does that mean for public good?
Governor Hochul: I will be very happy to tell you. I was just at the University of Buffalo two weeks ago with Marilyn Simons and Tom Secunda — the individuals who helped us innovate this, which no other state in the nation has entertained. I can tell you that Microsoft and OpenAI — they have amazing supercomputers dedicated to AI for their own profit; for the private sector. But we said, “We want to democratize AI, make it available to solve society’s problems, innovate new cancer therapies, help us predict weather better than we have been, so I know when that storm is coming and what I can do to prepare for it,” and all kinds of social problems that we can solve by being creative. So what I decided to do is put $275 million with the Legislature’s support — and that’s not always the easiest thing to do — then convince them to let go of that money and really take a leap of faith with me. But then the private sector raised $150 million — but we have university partners. This is what sets us apart. I have Cornell and NYU and RPI and Flight Iron Institute, Columbia, CUNY and SUNY schools all have bought into this, so they get a piece of the action. Their researchers, their students can use the power that I’ve created at a place called Buffalo, New York — where I’m from — and that is going to power the whole state’s research. And so nobody else touched this.
Dan Primack, Axios: Are you — and you mentioned Buffalo, New York, and we were talking backstage — are you concerned about the power needs for this supercomputer and other AI projects in the State?
Governor Hochul: Well, I picked Buffalo for a variety of reasons — and we just announced another supercomputer at the University of Albany — but because power is less expensive Upstate, It’s more plentiful; space is less expensive. So it’s all being used across the State. But as far as its home — I have Niagara Falls, which has been powering our state since since the original Tesla. So, we’ve been doing this since the turn of the last century.
So, I’m always concerned about capacity though as we’re attracting more and more, you know, large data centers and the supply chain companies that are now rushing to New York. I mean, I’ve been bringing companies from all over the world to Upstate New York now because of this whole innovation ecosystem we’re creating. But I have to focus on — not just our wind and solar and hydro and geothermal — but we’re going to have to look at other sources as well and be real aggressive about it because the states that are leaning into the energy sources are the ones that’ll win the race and we cannot lose that.
Dan Primack, Axios: From your perspective, what is the biggest mistake businesses make when dealing with New York State government?
Governor Hochul: When they’re dealing with our state government they have to have more skin in the game, and I want them to be fostering our social goals. And let me explain why Micron was so attractive to us: I’m a mom. I used to work on Capitol Hill for Senator Moynihan a long time ago. When my kids were born, I had no child care, had to leave the workforce for a while. We talk to companies like Micron and we say, “We want a number of things from you. We’ll help you. We want you to provide child care on site.” A lot of companies would say, “I’m not sure.” I said, “Do you want to diversify your workforce? Would you like to get more women? Would you like to get young women? Would you like to have it be a family friendly place?” Guess what they’re building right now? A child care center on site. We want them to draw from the neighbors, the neighboring communities that are underserved — the City of Syracuse. We want you to put in workforce development programs. We’re literally changing the curriculum in nine counties around where Micron will go, working with our teachers union, to say, “We’re going to teach young people coding and other computer science skills while they’re still in grade school and high school.”
So when Micron says, “Why would we come to Upstate New York?” You’re asking me to do all these things to further your social goal. But this is for your workforce. You’ll have a workforce that is not transitional. You’re not always going to have to be hiring someone. They’re not going to leave you after 18 months. They will stay. And that is part of the culture of Upstate New York, where I’m from, with the legacy industries, like the Bethlehem Steels — where my dad and grandpa worked — and Kodak and Bausch and Lomb. I say to them, “One of the drivers of why people should be coming to New York State is that we have a workforce that is brilliant. But also, they’ll stay with the company unlike what happens in other parts of the United States.”
Dan Primack, Axios: Let me tie two things together. You talked about skin in the game and you’ve talked about Buffalo and Upstate New York. One of the biggest deals I guess you’ve done as Governor is getting the stadium financing deal done for your Buffalo Bills. I will say your Buffalo Bills.
Governor Hochul: No, no. The only team that plays in New York.
Dan Primack, Axios: Fair enough. The only team that plays in New York.
Governor Hochul: Okay, and I love my other teams too, but just —
Dan Primack, Axios: Fair. Look, I’m from Boston, I — good, yeah, slam the Jets and the Giants, I’m good with this.
Governor Hochul: You want to go there? Okay. How are the Red Sox doing? How are the Red Sox doing?
Dan Primack, Axios: We don’t waste our money. Okay, so we — let me just ask though — when you talked about skin in the game, the package for the new Bills stadium is the most public financing ever for a football stadium in the U.S. Why don’t the taxpayers of New York get some skin in the game themselves? Why was there talk about negotiating some actual equity for the State of New York in this team?
Governor Hochul: Here’s what I’m going to explain to you: Look at the more recent data. This is not the largest subsidy for a team.
Dan Primack, Axios: But it’s huge. Let’s just stipulate very big.
Governor Hochul: Well, in proportion to the cost. And I was very smart when I negotiated this because I said, “There’s no cost escalation for the State.” So we’re in for $650 million of what’ll be well over a $2 billion stadium. The State of Tennessee kicked in a billion for their stadium. So we’re not in that league. But also, what happened was it wasn’t just waking up one day and — oh, let’s do a new stadium. They had a lease that expired. Other states were looking to recruit them. I know this for a fact. It’s a small market, the Buffalo Bills, there’s companies, states and cities that were luring them. I had to close the deal, because this is part of the identity of most of Upstate New York. Most of Upstate New York affiliates with this team, and this is important — an economic driver as well. We get a return on investment. After 17 years, I will have paid back that $650 million just in the income tax on salaries from the players.
Dan Primack, Axios: In that amount of time, the value of the team could be five times what it is now, and it’s the owner of the team who’s going to get to benefit the most.
Governor Hochul: Well, I’ve made sure that they are a Buffalo Bills team, not one of the other five cities that I was in competition with. Remember, I don’t lose anything — we don’t lose. This is an economic decision and the money will be paid back in 17 years, or perhaps sooner the way the salaries are going.
Dan Primack, Axios: Let me ask something else about balancing because you’ve talked about balancing, which is obviously the New York City congestion tax, or the congestion fee, rather, which you decided to kill shortly before it went into impact. How do you balance economic needs of the City and of the State with your climate goal?
Governor Hochul: Again, I’m going to correct a word here — kill versus pause.
Dan Primack, Axios: Okay, indefinitely pause. Is that indefinite going to come off?
Governor Hochul: I never used the word indefinitely. Those are people who are criticizing my decision to say that at this point — when we are dealing with escalating inflation, which was not even a factor — this is the first time in four years that inflation has really been a real burden for New Yorkers.
Fifteen dollars to start out of the blue. All of a sudden, turn it on — it didn’t take into consideration how New Yorkers are struggling right now. So, I said we’re going to put this on a pause for now, because I also have many other energy goals and climate goals that I’m focused on, but that does not mean it is dead. I know how to kill something. I did not kill it.
Dan Primack, Axios: You’ve said there’d be — I think you said, and correct me if I’m wrong — there’d be a replacement plan by year-end. Is that still on target?
Governor Hochul: Yes. We have until the year-end.
Dan Primack, Axios: You have until year-end. Do you expect that by year-end, there will be a replacement plan?
Governor Hochul: I will have revealed, to the world, the strategy that we’ve been working on for a long time with the Legislature, which is also involved. I want to be clear on that. The Legislature is not in session right now, but that was a decision that was based on the fact that $15 is too much for New Yorkers right now. And, even London — that people tout and look at what they did in London — they started at €8 at the time and gradually, over time, went up to that, so there’s not a shock to the system.
And, also, I’m focused on bringing the City back. People can work remotely, right? This wasn’t even an option when this congestion pricing was put in place in 2019. It wasn’t even an option. Of course you’re going to come to work. And it’s $3,800 more a year at $15.
That’s a lot for a teacher, or a health care worker, or a delivery person coming in from Queens or a plumber coming into town. So, I’m just the kind of Governor that’s going to look at the impacts of decisions — who’s being hurt by this? Can they defend themselves? Do they have lobbyists? Do they have access to the editorial boards? No, these folks don’t. I was their voice, but I’m also saying, I am so vested in making sure that we achieve our climate goals because I believe in them.
I grew up in a toxic environmental dump. The air was orange when I was growing up because of the smoke billowing out of the steel plant, which created 20,000 jobs, but nobody cared about the environmental impact. So, I’m going to make sure that New York continues to be nation leading and achieving our energy goals, our climate goals.
Dan Primack, Axios: Do you feel the remote work or the hybrid work revolution — call it post-COVID — do you feel that’s changed Manhattan permanently?
Governor Hochul: Yes. Yes, it has. But we can always reimagine Manhattan just like we did after 9/11 — and, I give Mayor Bloomberg a lot of credit for what he did during that era. When you look at this place, people did not live in lower Manhattan, they worked there but they never lived there. Now, it is a thriving 24/7 community.
We can do that in Midtown as well, and I’m convinced of this — that we can take with the laws I had to change because you couldn’t convert commercial into residential without a change in the law that I was able to secure just a few months ago. Now developers can look at a commercial building in Midtown and say, “You know what? It’s only 30 percent full. I’m not sure people are coming back. Let’s convert it into housing.”
Now I’ve got more affordability because I’ve created supply, which is everything.
Dan Primack, Axios: You mentioned Mayor Bloomberg. Let me ask about a more recent, current mayor. Business people talk all the time about wanting certainty. They often do it for their own purposes. How is it problematic for New York City’s business particularly, to have a mayor who is under indictment?
Governor Hochul: I speak to business leaders all day long, including this morning over a breakfast meeting. Some significant leaders. And I asked them that question: How are you feeling? And the answer was, “Well, three weeks ago, it was a hair on fire moment.” And I’ve stepped in to offer the stability to say, we’ll work with the Mayor to get through this because I come from a business family. I know uncertainty is paralyzing, but they are expressing to me that they now have confidence, there’s been changes in the administration.
They know that I’m keeping an eye on this situation because I want the City — and I represent 8.3 million New York City residents as well. These are my constituents. We will make sure that their services are provided. They will not see a disruption in what they’re accustomed to getting because they deserve to have the best. And I’m watching all this.
Dan Primack, Axios: You obviously originally were running mates, or you served under former Governor Cuomo. There’s lots of talk about him possibly running for mayor here. I’m not asking, obviously, who you would endorse. I’m asking, should voters consider him as a viable candidate if he chooses to run, given what happened in the past and some of the things you’ve said about what he did in the past?
Governor Hochul: I’m not here to pass judgment on people right now. But I will say this: New Yorkers deserve people with integrity and accomplishments and who do things for the right reasons. Who will do it for the benefit of the people and not their own self-serving reasons. So I will be looking for people like that.
Right now we have a mayor — we have an elected mayor of the City of New York. Everything could change or everything may not change. But we do know we have an election two weeks from now. Two weeks from now. And that is the one that we’re focused on, as well as my intensive, intensive work — not just for Kamala Harris.
I just got back from seeing her in Michigan and we were in Pennsylvania, but here in New York, we have the opportunity to give President Kamala Harris a Democratic House Representatives. And I am laser focused on making sure Hakeem Jeffries, our very own New Yorker who knows our community and its needs and knows I’m going to need money for the MTA for example. Give me more money for public transit. That’s my number one ask. I have to make sure we pick up some seats in the Hudson Valley. And in Long Island, I just came in from Long Island just a little short time ago. And, you know, the polls are showing that areas that were written off, are now in place. So the world is going to change in two weeks.
Dan Primack, Axios: Let me ask one quick final question because we are out of time. You have said you are, I think the term was “Not going anywhere.” Plan to run for reelection here. If Kamala Harris wins the White House and she calls you up, says, “Governor Hochul, we would like you to come down to D.C. and serve as secretary of X.” Are you going?
Governor Hochul: I’m going to say this and you can quote me 1,000 times: “President Harris, I’m honored that you’d consider me to join your brand new administration — historic. I’m so excited about you, but I’m going to do better for you continuing as the Governor of New York because you’re going to need allies in our state houses to make sure that we continue the great partnership that I’ve had with the Biden Administration. And I’m not going anywhere.”
Dan Primack, Axios: Governor. Thank you. Appreciate it
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