Establishes the small business crime prevention services

Summary of specific provisions

Bill § 1 adds a new § 139 to the Economic Development Law establishing a small business crime prevention services program within the Division for Small Business. The small business crime prevention services program, directly and in conjunction with other state, Federal and local agencies, shall provide small businesses with access to the following services:

* information on strategies, best practices and programs offering training and assistance in prevention of crimes in and around the premises of small businesses or otherwise affecting small businesses, including but not limited to: assault, arson and other violent felony offenses; robbery, burglary, theft, identity theft, counterfeiting, check and credit card fraud, and other fraud; and vandalism, graffiti and other property damage;

* information on eligibility and applications for financial assistance for small business crime prevention services provided by the Urban Development Corporation (see bill §2 below);

* information on eligibility and applications for other programs of financial assistance for small business crime prevention offered by state or Federal agencies or local governments;

* information on protecting the assets of small businesses from crime, including risk reduction strategies and insurance availability; and

* information on responses to crime, including reporting of crimes, submitting insurance claims and crime victim assistance programs.

The small business crime prevention services program would also identify issues relating to crime affecting small businesses and assist the Division in making recommendations for legislative, regulatory and programmatic actions to address such issues.

Bill §2 adds a new paragraph (1) to subdivision 1 Unconsolidated Laws §6266-m to add a new program under the Empire State Economic Development Fund (administered by the Urban Development Corporation). The small business crime prevention assistance program would provide loans, loan guarantees, interest subsidies and grants to small businesses, municipalities, not-for-profit corporations or other organizations for the purpose of preventing crimes against small businesses or on the premises or in the vicinity of small businesses. Eligible activities would include such items as initiating or

maintaining business watch programs, installation of lighting, security equipment and other physical improvements to prevent or deter criminal activities, and the development and dissemination of information to owners, operators and employees of small businesses on effective crime prevention strategies. preference in awarding assistance is given to projects that benefit distressed areas or other areas with a demonstrated need based on crime statistics, provide a local or private-sector match, or demonstrate a likelihood of positive impact on crime prevention.

Bill §3 amends Executive Law §837 to direct the Division of Criminal Justice Services to provide advice and assistance in the development of these programs.

Summary of amendments

Based on discussions in the Assembly Small business Committee, the program of advising and assisting small businesses will explicitly address problems of financial frauds against small businesses, including "identify theft, counterfeiting, check and credit card fraud and other fraud."

Effects of present law which this bill would alter

This bill would establish new measures to assist in small business crime prevention.

Justification

It is often said that "an ounce of prevention is worth a pound of cure" - and that is clearly the case when dealing with criminal behavior. The costs of crime are substantial, and are not only paid by the victims. Crimes against small businesses in New York's communities deprive the State of millions of dollars in sales and income tax revenues, and can cause small businesses to shut down, leading to a spiral of neighborhood decay.

Unlike larger businesses, small businesses often lack the resources to organize and implement an effective crime prevention strategy on their own. There are effective measures, including Business Watch and Fleet Watch programs (usually run jointly by Chambers of Commerce and police agencies), lighting and other security enhancements, and training programs that can be effective in reducing crime in New York's main streets and other small commercial areas. However, often such initiatives require effective promotion and, in some cases, seed money. This bill, which is modeled in part on successful similar programs in Australia, would provide the organizational and financial resources needed to deliver cost-effective crime prevention programs to New York's small businesses, to the benefit of the wider community.

Prior legislative history

2009-10: S.5041/A.350 (Latimer) - Reported and Committed to Finance 2007-08: A.11843 - Referred to Small Business

Fiscal implications for state and local governments

Any additional resources needed for the Division for Small Business are expected to be offset by the economic benefits of crime prevention, including the prevention of direct economic losses to the State through lower sales tax and income tax collections and the

higher costs criminal activities create for law enforcement and courts. The funding of small business crime prevention assistance would be through the Empire State economic development fund (EDF), a multipurpose fund providing grants, loans and other aid to meet various communities' needs. The funding level provided for EDF purposes varies from year to year and is determined as part of the budget process. Local governments would stand to benefit directly, as recipients of small business crime prevention assistance, as well as through the increased tax revenues resulting from more effective crime prevention.

Effective date

First day of April after having become a law, with provisions.