TESTIMONY
Testimony by Kevin Kim, Commissioner of NYC Department of Small Business Services on FY 2025 Budget
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14 min
Commissioner Kevin Kim presents the NYC Department of Small Business Services' (SBS) fiscal year 2025 budget testimony to the City Council's Committee on Small Business.
He discusses the department's commitment to supporting small businesses and advancing the mayor's economic agenda focused on equity and inclusivity. Key points include:
- Emphasis on the role of small businesses in leading the city's recovery efforts
- Acknowledgment of the City Council's role in connecting SBS with local organizations
- Expression of eagerness to continue partnership with the City Council to advance shared goals
Kevin Kim
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Thank you very much.
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Good morning, Chair Feliz, and members of the committee on small business.
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My name is Kevin De Kim, and I serve as the commissioner of the New York City Department of small business services or SBS.
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Joining me today are SBS's executive deputy commissioner for programs Dineshale Gross to my right, an executive deputy commissioner for administration, Michael Forte to my left.
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We are pleased to offer our testimony on SBS's fiscal year 2025 budget.
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New York City has experienced a remarkable resurgence.
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Mayor Adams' prudent fiscal management coming out of the pandemic has led to record breaking job levels.
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And improved bond ratings.
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These indicators showcase the success of the mayor and deputy mayor Maria Torres springer's vision outlined in the blueprint for New York City's economic recovery through which small businesses play a central role and shaping the city of yes.
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Today, I am proud to highlight SBS's significant contributions to the recovery through pioneering initiatives such as the NYC Small Business Opportunity Fund, and the creation of the first ever AI chatbot.
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Designed to assist small businesses.
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I also want to recognize the vital partnership between city council members and SBS.
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Many of our achievements stem directly from our work together.
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In coordination with your offices, I have personally visited small businesses in all 51 city council districts with virtually every city council member.
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Thank you for your warm hospitality during these visits and your collaboration throughout the year.
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SBS's fiscal year 25 preliminary budget stands at $173,900,000, of which 34,300,000 or 19% is allocated to personal services.
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Of the total budget of 173,900,000, Approximately 70,100,000 or 40% represents pass through funding for other city entities.
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Including the NYC Economic Development Corporation at 36,700,000, NYC Tourism And Conventions, at 17,400,000 and the trust for Governors Island at 16,000,000.
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As a conduit to these entities, SBS does not manage or spend any of these funds.
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The budget allocates a 103,800,000 to SBS programs, personnel, and services, but excludes the extensive discretionary contract portfolio typically added by counsel at the adopted budget in June.
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Currently, SBS's budgeted headcount stands at 346 with a 167 filled since the start of the Adams Administration.
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Our dedicated team at SBS carefully manages these resources to deliver programs that connect New Yorkers to good jobs, create stronger businesses, and build vibrant neighborhoods.
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This work is conducted through SBS's 4 major program divisions, the division of Business Services or DBS, the division of Economic And Financial Opportunity or Defoe, the workforce development division or WDD and the neighborhood development division, NDD.
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Additionally, we oversee specialized experts and teams including cannabis NYC, NYC, New York City Office of Nightlife, New York City Food And Beverage Industry Partnership, Waterfrontpermits, Women's Entrepreneurs, NYC, or we NYC, and black entrepreneurs NYC or BNYC.
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Our DBS division, the Business Services division, offers an array of free business services, connecting entrepreneurs with financing opportunities, business courses, mentorship legal assistance, and more.
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Notably, we launched last year the New York City Small Business Opportunity Fund in partnership with Goldman Sachs and Mastercard Center for Inclusive Growth.
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This initiative, the largest public, private effort, and city history to support small businesses has facilitated over $85,000,000 in low interest loans to more than 1000 small businesses through collaboration with 8 Community Development Financial Institutions or CDFI's.
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Recognizing the systemic challenges faced by businesses owned by people of color and immigrants in accessing financing We intentionally designed the Opportunity Fund to mitigate these barriers by eliminating traditional obstacles such as application fees, and minimum credit score requirements.
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We also employ targeted outreach strategies in language in communities throughout the 5 boroughs.
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We reached over 500 businesses and historically underserved neighborhoods with door to door outreach including more than a 120 Bronx based businesses on launch day.
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As a result, Approximately 80% of the Fund's loans were awarded to minority or women owned businesses, with 69% going to businesses owned by self identified bipoch New Yorkers.
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That 69% represents more than the double the rate at which bipoch businesses access capital through the federal Small Business Administration.
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Moreover, 59% of the awards went to businesses in low to moderate income neighborhoods.
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Finally, another data point that demonstrates the success of our outreach effort is that while the Bronx Businesses represent 8% of all small businesses in New York City.
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Bronx Businesses received 14% of opportunity fund loans and businesses in every city council district received funds as well.
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This underscores SBS's unwavering commitment to overcoming historical inequities and fostering inclusive economic growth.
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One notable beneficiary of the Opportunity Fund is a husband and wife team behind Booney Coffee, Ariana and Elias Pravasi, who received over a $100,000 to expand their Washington Heights and inward based business operations.
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They will use these funds to open a coffee rotisserie in the Bronx, expanding from serving coffee at their four cafes to supplying now coffee beans throughout New York City and giving more businesses the opportunity to cut costs and roast their own brew.
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Their story exemplifies the transformative impact of strategic financing on local economies.
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And the powerful role small businesses have, not just to create wealth, but provide something special for our neighbors.
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SBS's default division facilitates opportunities for minority and women business enterprises or MWBEs by providing certification technical assistance and capacity building training.
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We collaborate with city agencies to connect MWBEs with contracting opportunities supporting their participation in the city's procurement processes.
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Our year round efforts culminated at the 15th annual citywide procurement fair at Barclays Center where the administration announced a record $6,000,000,000 awarded to MWE Firms in fiscal year 23.
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Nearly three quarters of all MWBE's awarded city contracts utilized SBS services, reflecting our commitment to facilitating their success.
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Once such success story is out of Ibrahim Badji, a 1st generation Senegalese American entrepreneur whose company Goodvibe supports high school students in pursuing debt free higher education.
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Through SBS's direct assistance, Mister Badji secured 5 government contracts totaling $50,000, enabling him to expand his impactful initiatives and contribute to his community's well-being and our city's greatest mission serving our children.
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In alignment with Mayor Adams' vision and legislative efforts led by chief business diversity officer, Michael Gardner, The administration increased the dollar value of MWBE non competitive contracts initially from 500,000 to a 1,000,000.
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And then again this year from 1,000,000 to 1,500,000.
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Using this method in fiscal year 23, The city unleashed the record setting a $175,000,000 in contracts awarded to MWA's, a 60% increase over the prior year.
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Moreover at SBS, we expanded the contract financing loan fund program to provide an additional $50,000,000 and low interest funding, which will support 350 vendors to fulfill $600,000,000 in Citi contracts over the next 2 fiscal years.
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NYC's New York City's greatest asset is our talent.
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SBS's WDD division plays a pivotal role in connecting job seekers with employment opportunities and assisting businesses and fulfilling their workforce needs.
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Through our network of 18 SBS workforce 1 career centers across the Five boroughs, we provide free job placement services, career coaching, and training programs.
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In fiscal year 23, we helped 23,599 New Yorkers get a job or advance their career.
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SBS's efforts contributed to the recovery of nearly 1,000,000 jobs lost during the pandemic exemplifying the resilience of New York City's workforce, and the dedication of our incredible SBS team.
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One success story I'd like to share is that of military veteran Rudy Kazares, who partnered with SBS to expand his logistics company in the Bronx, hiring 49 local residents through workforce 1.
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Our collaborative efforts with community partners have further enhanced our ability to connect job seekers with diverse employment opportunities, again fostering inclusive economic growth.
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Our neighborhood development division, NDD, oversees our neighborhood development initiatives and supports New York City's network of 75 business improvement districts or bids, which serve nearly 300 miles of commercial quarters and invest more than 187,000,000 into local economies.
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In the Adams administration, we have allocated approximately $27,000,000 in grants over 100 community based organizations, spurring commercial corridor revitalization efforts.
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Examples of the impact of these grants include the installation of seasonal Ramadan lighting by Brooklyn's Bay Ridge 5th Avenue bid, neighborhood beautification efforts by Morris Park bid in the Bronx, and enhanced district marketing by East Brooklyn Bid.
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Brooklyn's Bay Ridge 5th Avenue Bid, for example, used their bid grants to install seasonal Ramadan lighting along 20 Blocks and over 400 storefront businesses, while Morris part bid in the Bronx doubled down on neighborhood beautification by planting 47 guarded tree pits, cleaning up over a 100 tree pits, and installing 10 planters along their commercial quarter.
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East Brooklyn bit leveraged their funding to boost business to business marketing and reached over 7000 people on Facebook.
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These initiatives not only enhanced the aesthetic appeal of commercial districts, but also stimulate economic activity and create safer neighborhoods.
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Our partnership with the city council has been instrumental in advancing initiatives to support small businesses and reduce regulatory burdens.
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This year, the council passed intro 8452023, a critical component of the mayor's small business forward initiative to cut red tape.
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With this legislation signed by the mayor, the administration has implemented over 90 reforms to lower fines, create cure periods, or institute first time warnings, putting dollars back into the hands of business owners to reinvest in their businesses and communities.
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Building on the city council's 1 stop shop portal enacted into law in October 2022, we launched the SBS business site on the my city portal with a 1st in the nation, AI Chapat, to help business owners navigate city government.
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The new AI chatbot serves as a 24 hour executive assistant, saving business owners and entrepreneurs time and money by instantly sharing actionable and trusted information from more than 2000 New York City Business web pages and articles, and it's in the top 10 languages spoken in New York City.
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Additionally, this committee helped to bring the of nightlife to SBS from the mayor's office of media and entertainment through legislation.
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The O and L team is right at home at SBS working across our divisions to support the $35,000,000,000 industry.
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As we work together to modernize government services and support local communities, I am proud to also have great relationships with the community boards, bids, chambers of commerce, merchants associations, community based development organizations, immigrant focused advocacy groups, counselors, and nonprofits in each of your districts.
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The city council provides a bridge for our agency to so many local organizations, and I am eager to continue this partnership.
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In conclusion, SBS remains steadfast in its commitment to mayor Adam's economic agenda centered on equity and inclusivity with small businesses continuing to lead our recovery efforts.
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We look forward to working with the council to advance our shared goals.
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Thank you for the opportunity you to testify, and we welcome any questions you have for me or my team.
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Thank you.
