Despite proclamations, firm has never actually moved to NY

| Times Union

ALBANY — In a 2014 video, Greg Heiland sounds almost giddy at the prospect of settling down in the Empire State.

“Why is our Arizona-based company relocating to New York? I tell people it’s the climate,” Heiland says in the video produced to tout Gov. Andrew Cuomo’s Start-Up NY program, which offers a 10-year tax holiday to certain new businesses coming to the state, or existing businesses expanding here.

“You’ll get a warm welcome in New York,” Heiland says as he’s depicted at several sites around SUNY Polytechnic Institute’s Albany complex. The same year, Cuomo’s State of the State address included mention of the expected move by Valutek, which makes gowns, gloves and other items used in chip-fab clean rooms. The move had actually been announced in 2011 by former state Assembly Speaker Sheldon Silver.

But three years after the video, there’s no indication that the Phoenix-based company is moving its operations here.

In a recent interview, Heiland wouldn’t say how many of his company’s estimated 25 employees are based in New York. And he couldn’t offer a date for when he might transfer any jobs here.

Even so, Heiland says he’s still bullish on the region’s tech sector despite last year’s pay-to-play scandals involving former SUNY Poly leader Alain Kaloyeros and former top Cuomo aide Joe Percoco.

“You know, I want to put a good face on what SUNY is doing,” Heiland said, stressing that he continues to sell his products to users at SUNY Poly and elsewhere.

The apparent lack of a move illustrates what observers say is the difficulty of luring businesses from other states to New York, despite the vast subsidies being offered to start-ups, and to keep companies based here from leaving.

Valutek’s website lists Albany among several global locations where it does business. But a closer look shows that the firm appears to have little more than some rented space at the Albany SUNY Polytechnic Institute campus and a warehouse in the Rotterdam Industrial Park.

“We understand that the company may rent space from Fuller Road Management Corporation,” SUNY Polytechnic spokesman Steve Ference said in an email. He would not elaborate, but referred questions to Valutek.

Fuller Road is one of two nonprofit entities set up by SUNY Poly to handle real estate development projects, many of them heavily subsidized by the state.

Initially, Valutek was supposed to go to SUNY’s new complex in Marcy, near Utica. But Heiland said that space is now slated for use by General Electric Co.

Valutek has never signed a contract with the state or SUNY to occupy space. Nor did they seek any tax breaks from the Start-Up initiative or other business incentive programs.

In addition to its Phoenix facility, the firm make its products in Malaysia, Taiwan and South Korea, said Heiland.

There are lots of reasons that manufacturers might hesitate before leaving their home state for New York. For one thing, income taxes can be twice as high in New York compared to Arizona, with top rates at 8.82 percent compared to 4.54 percent.

“It’s not just taxes,” E.J. McMahon of the fiscally conservative Empire Center think tank. New York “can be seen as a tough place to do business.”

For example, the average cost for an individual’s employee health policy in Arizona runs $5,600 per year compared to $6,800 in New York, according to the Kaiser Family Foundation.

Likewise, workers compensation insurance costs can in some instances be twice as high as in Arizona.

Despite that,  Heiland said he was confident SUNY Poly would continue to grow, especially since the chipmakers and other high-tech firms working at Albany’s research and development center have already invested large sums to be there.

“The semiconductor industry is basically healthy,” he said.

© 2017 Times Union