Gillibrand announces bill to help employee-owned businesses and co-ops
SARANAC LAKE — Sen. Kirsten Gillibrand visited Saranac Lake Monday to make an announcement about new legislation to help small businesses continue when their owners retire.
The junior senator from New York state, a Democrat, announced her Main Street Employee Ownership Act at the Adirondack North Country Association office on Main Street. The act would support small businesses transition to an Employee Stock Ownership Plan or a cooperative.
Gillibrand said the thrust of the legislation was toward helping cooperatives and employees wanting to own the company they work for gain access to capital. Some loans through the federal Small Business Administration are not available to co-ops, she said.
“I believe our country needs to start rewarding work again,” Gillibrand said. “Rewarding work means paying workers enough that they can actually take care of their families. It means putting the brakes on companies who want to shut their doors and leave dozens of workers in the community stranded. It means ensuring that every hard-working man and woman has the means to save for retirement, take a vacation once in a while and take some time off, God forbid, when a family member gets ill.”
According to a study conducted by Guardian Life Insurance of North America, 35 percent of small business owners are planning to fund their retirement by selling their businesses, but they may not be able to find buyers.
“There are thousands of companies run by baby boomers who are getting ready to retire in the next couple years,” Gillibrand said. “How can we make sure those businesses stay running and stay local after their owners retire?”
She cited statistics showing that workers in employee-owned businesses or cooperatives are more productive and better paid and save more for retirement. “As a leader in the region, ANCA recognizes this,” she said. “ANCA’s developing an initiative to assist business owners across the North Country in converting their businesses to ESOPs and co-ops. I’m excited to join their efforts to secure federal funding for this important work.”
The Main Street Employee Ownership Act would update the SBA’s lending practices to better serve employee-owned businesses, facilitate SBA lending to cooperative businesses, and empower the SBA to assist small business owners in converting their companies to employee ownership.
Gillibrand said it also would increase SBA outreach to small businesses, because many of those who qualify for loans “don’t even know they exist.”
A House of Representatives version of the legislation “already passed one of the most important committees it needed to get through,” she said. “I encourage all of you to raise your voices to speak out about why employee-owned companies matter, why cooperatives and ESOPs work and all the good they can do for our communities and our workers.”
Kate Fish, executive director of ANCA, said the nonprofit organization can provide boots on the ground to help small businesses survive.
“Our research indicates that in the North Country, north of Route 90, there are probably ten to sixteen thousand businesses that are owned by baby boomers who are going to be looking at retirement,” Fish said. “That’s a huge number of people employed.
“It’s kind of an invisible problem until you see the ‘going out of business’ sign,” said Fish. “If we lose 15,000 jobs, we’re not even treading water.”
ANCA is working to create a center for businesses in transition that will help to keep those businesses alive and local.
Fish introduced Ashlee Kleinhammer, co-owner of North Country Creamery in Keeseville, which is looking into becoming an employee-owned business.
Kleinhammer said she and her husband, who leased the 200-year-old dairy in 2013 and bought it outright in 2017, aren’t baby boomers.
“Since our beginning we’ve highly valued employee involvement in decision making,” she said. “We last year started to seek help to form a worker-owned cooperative. We’d like to extend that to ownership of the business once we’ve gotten the professional help that we’re looking for. We’re interested in it because of the democratic process.”
The senator’s appearance drew local and regional economic development officials to ANCA’s offices upstairs from Adirondack Bank, as well as Democratic congressional candidate Emily Martz, who is a Saranac Lake resident and former ANCA employee. A staff member of U.S. Rep. Elise Stefanik, R-Willsboro, was also present.
After the press conference, Gillibrand said she would love to buy a second home in the Adirondacks and eventually move her family’s primary residence from Troy to here, but that may be more of a “20-year goal.”
Managing Editor Peter Crowley contributed to this report.