Video, Audio, Photos & Rush Transcript: Governor Hochul Holds Roundtable With Business Leaders and Farmers Impacted by Trump’s Tariffs, Continues to Call for $13.5 Billion Refund
Governor Kathy Hochul today held a roundtable with business leaders and farmers from Western New York to hear about the challenges they’ve faced over the past year while navigating the Trump administration’s reckless tariff policies. After the Supreme Court ruled the President’s tariffs unlawful, Governor Hochul immediately called for the federal government to return the $13.5 billion illegally taken from New Yorkers, just like those she met with today. During the conversation, the roundtable participants underscored how the economic chaos coming out of Washington has upended their families’ financial livelihood and made planning for the future impossible.VIDEO: The event is available to stream on YouTube here and TV quality video is available here (h.264, mp4).AUDIO: The Governor's remarks are available in audio form here.PHOTOS: The Governor’s Flickr page will post photos of the event here.A rush transcript of the Roundtable Discussion is available below:Governor Hochul: Hi. Well, I spent a lot of time in the Amherst Chamber of Commerce offices in my time in Congress. In fact, my office was right across the way here, so we did a lot of events engaging the business community so I could get their viewpoints, which are critically important to me as I formulated policy back in Congress, but even more so now as the governor of this state, when I'm seeing so many threats that are hitting not just this community that I cherish and love, but also the entire state and indeed our country.And so I want to put a special emphasis and focus on what is happening with tariffs. I gandered with members of the Buffalo and Niagara Partnership early at the first advent of the tariffs — we met last spring — and had a really candid conversation on what this could be doing to businesses. One year later, it is far worse than anyone could have expected. I mean, what has happened is just so incredible. This is an area that's so used to building things, and that's from a family that made steel at the Bethlehem Steel plant where people make cars and you ship things.We welcome visitors from around the world. And right now, there's just so much uncertainty. I think one thing I know about businesses: they need stability, they need certainty. Just tell us the rules of the road and we'll follow them. But everything is so chaotic for business communities. And when businesses are deciding whether to expand or what their pricing should be, this lack of knowledge of what the next day is going to bring is incredibly disruptive. And I want to comment on that, but also know that our economy is so closely tied to the Canadian economy.I say this all the time when I'm in New York City or the North Country, where they're equally affected, Western New York is the largest community along our border — largest cities, largest region, 430 mile border with Canada. So when you think about even other states, we have the population of the businesses and the farms that are being so negatively impacted by this hostility toward what had always been our greatest partner, our strongest allies — in my opinion, still is — and that is Canada. And I've been at events with the Canadian Council General and others, and I want to — I'm always saying to them, “This is not who we are. We love you. We want you to come here. We want to let you know you're welcome.”But at a time when, we recognize that this relationship from the federal government with New York's largest trading partner, which is Canada — we've exported $20 billion to Canada and imported $20 billion as well. So it's a relationship that's in balance and it supports jobs across both borders. And what has happened to not just our industries, but our tourism industries — it's been a hard hit. When you have 400,000 fewer Canadians coming over, that's a lot less money being spent here. That is hotel rooms not being filled. It's people not going to attractions from Niagara Falls down to the city and beyond.So it's had a real impact, and the small businesses particularly are always the ones hardest hit. They don't have the resources to get them through the tough times and they're really feeling it — and I'm hearing it nonstop. Agriculture, we'll be hearing from our farm community, but the cost of fertilizer, and lumber and the shavings for the stalls — I never realized how much we rely on Canadian lumber and fertilizer ingredients. I mean, these fertilizer ingredients that are essential come from either Canada or Ukraine, okay? Right now, we're not in good places to secure this and it's a huge additional cost.And so it's affected our — also, people aren't buying our exports. There's just — whether it's our wines, they're not buying our wines. And just, there's this sense of protecting themselves because they're angry at us and it's having a very, very negative ripple effect on us.What I have had to do is propose support for our farmers. I introduced $30 million into our budget to make sure that we could support them, and the Department of Agriculture will be letting people know how we get that money out. There will be direct support payments to our farmers. And other ways we can support them.And I want to thank our elected officials who've joined us here today, Senator Jeremy Zellner, thank you for your advocacy on behalf of this community. I know Assemblymember Karen McMahon will be joining us briefly as well as our County Executive. But Shawn Lavin, our supervisor as well, thank you for welcoming us.But AJ, this is something you care deeply about. We've worked closely for many years on all kinds of issues, and I want to thank you and everyone who's part of the Amherst Chamber, a powerhouse. And when you're feeling the effects, your members are feeling the effects, it means that a lot of other, less powerful organizations are feeling it as well.So as goes, the Amherst Chamber goes, so goes our region. So I'd like to introduce you and ask you to lead off the conversation and let me hear directly. I'm done talking, I want to hear from people unless I have questions — of course, I always have questions — about what this really feels like. What is the short term impact, the long term impact and what the anxieties are right now. So, thank you, AJ.AJ Baynes, President & CEO, Amherst Chamber of Commerce: No, thank you Governor for being here today and convening this group. I was honored when you called and reached out about this. I know this has been very important to you, this is very important to many of our businesses.So the Amherst Chamber of Commerce is here in the town of Amherst, but our membership spans 79 zip codes from here to Rochester. So you are right when you say it has a Western New York feel to it. This group that you're going to hear from today is from a diversity of industries across our region. Not all of them are chamber members, but it was important to us to make sure that we were all gathered here today to discuss this, and what we've been hearing mostly from our businesses is the uncertainty – the chaos.You talk about the business leaders wanting to have good plans in place and that is very important. Businesses plan and there's been a lot of issues over the last six years or so, whether it was dealing with the pandemic and now dealing with the uncertainty of what the cost of goods are going to be, whether they're importing them, exporting them, finished product and putting things together. But this is important for us to hear from this group, and what I would like to do is start with Jim Bittner from Bittner-Singer Orchards which traces its origins back over a hundred years here in this region.Jim Bittner, Managing Partner, Bittner-Singer Orchards: Thanks for inviting me first of all. The biggest problem we have with what's been going on with trade and tariffs, and I think every business person will tell you, is the chaos, confusion, and uncertainty. I am a fruit farmer, I have to order trees, make plans four years out. I have to decide what root stocks, what varieties I'm going to plant, what I'm going to plant, whether it's peaches or cherries or apples, and what's going on just makes that decision process even more difficult.We just don't know what to do, so consequently, a lot of us are sitting on our hands. We're not making the investment we should make. We're always told in the fruit business, if you're not replacing 5-10 percent of your orchards every year, you're probably going to be out of business down the road somewhere. You need to make continual investment in the business and it's difficult.Our farm is 50 percent apples. New York is the second largest grower of apples in the country still and about a third of the apples produced in the United States have to be exported. We don't care who exports them. In New York, we send some apples to the Middle East, Israel, Vietnam.We don't export a lot of apples from New York, but we depend on the growers in Washington to export to Asia because if they don't have those markets, those apples come here and lower our prices. So it's to my advantage that those can be exported.Canada and Mexico are the two biggest export markets for American apples. We're not on good terms with either country and it's really made it more difficult for the marketers of those apples. Trade relations take a long time to build. When you have a customer in a foreign country, it's a relationship. They're not built or rebuilt overnight.You mentioned fertilizer – all of the potassium fertilizers come out of Canada. We don't have them available. They're not mined in the United States in any quantity, so we depend on that. Those prices have gone up around 30 percent in the last year.I'm in a business that has specialty equipment and tractors. They all either come from Europe or Asia because the manufacturers have bigger markets in those countries. So those tractors, and the parts to repair the ones we currently have, have gone up 50 percent in the last year for anything we want to get out of Europe or Japan. It just makes things very difficult.Thank you for the $30 million proposed to be in the state budget to help farms deal with tariffs, but I said it is the uncertainty that we're suffering with the most.Governor Hochul: We want you to be successful, Jim. I visited your farm many times and it's wonderful to see how industrious and how hardworking people are in our farms, and I'm really proud of it. I want to make sure that you can thrive, so we'll be there with support, but it's a shame we have to do that to offset policies out of Washington, which should be there to help our farmers and to help our businesses. So hang in there.I also want to acknowledge our county executive has arrived – Mark Poloncarz. Thank you very much for your time and for supporting this effort. And also Karen McMahon, our assemblymember, thank you.AJ Baynes: I'd like to invite Christian Johnson, the owner and founder of Beautiful Brains protective equipment, dealing mostly in the Asian market, so there's been a lot of uncertainty there for you.Christian Johnson, Founder & CEO, Beautiful Brains: Yes. Good morning, Governor. Thank you for having me. At Beautiful Brains, we manufacture sustainable products such as biodegradable nitro gloves and eco-friendly personal protective equipment. As well as, we provide a service called Smart Cycle, which recovers those products and we repurpose or recycle those products. We try to support New York state's climate goals in that way.As an MWBE manufacturer, we see a disproportionate cost pressure when it comes to the volatility with the tariffs. We don't purchase at scale like our large multinational distributor competitors, and oftentimes, we're caught in contracts where we can't change our price, so our margin just diminishes, which could easily put us out of business at any point because we can't really adjust our cost. It really weakens our competitiveness and the ability to participate in government procurement or even large organizational contracts.Then the second way is tariffs. The volatility of tariffs really discourages products like ours. They cost more because of the advanced materials that we have to import, so then, when companies have to decide between traditional products – and now the cost of our products are increasing – they'll tend to go with the traditional products. Whether or not they're eco-friendly or environmentally friendly really is not going to matter. It really does put us in a position where we have to decide – is it cost effective for us to continue to pursue our mission of sustainability and climate change?Governor Hochul: And so, you've already seen increased prices or costs for you?Christian Johnson: Oh, yeah, and our margin just diminishes down too.Governor Hochul: So the pressure point you have to pay tariffs at the dock basically. The companies have to pay when it lands as opposed to recouping the money from the sale and be able to pay it later, like taxes.Christian Johnson: Correct.Governor Hochul: So you have to pay that on the front end. There have been some tariffs in effect, but the scale of them now is beyond what you could have possibly budgeted for, right?Christian Johnson: Correct. And then the volatility of it – one day they're this much, and then the next day they're lower. So we just don't know and it's hard for us to go back to our customer and say “we're charging you this now, and now we're not,” so it is very prohibitive to our business.Governor Hochul: Thank you for sharing that.AJ Baynes: I'd like to introduce Angelo Barberic, a partner with AirSep, a longtime Town of Amherst company, that has had a great deal of success here, as a manufacturer of oxygen machines. You're dealing quite a bit with this tariff issue right now, right?Angelo Barberic, Sales Manager, AirSep: Yes, we are. Good morning, Governor Hochul. Pleasure meeting you and AJ, thanks for the invite. As AJ mentioned AirSep Corporation has been here in Amherst for the last 36 years manufacturing onsite oxygen systems for both industry, medical, environmental applications.Our current manpower, we have about 50 people now. Unfortunately, we had to lay off five people just last week because of some of the loss of sales, so that's affected our personnel. Our annual turnover, again, is about 30 million in sales, and of that about 35 percent is export. So, the biggest effect that the tariffs have made is really on our Asian customers, as has been brought up by Jim and Christian.It's this reciprocal tariff situation where our distributors in these foreign countries are hit with very high tariffs on the products. Any profit that they were expecting has been wiped out, and so for the last year they've been spooked. They no longer are purchasing AirSep equipment and are going to other manufacturers, whether they're from Asia or from the Middle East or wherever they're manufacturing these products. So that is unfortunately affected our business in Asia.When we do import products from either Europe – machinery, air compressors – I'm responsible for Europe, Russia, Africa, Middle East. So all my products are going outside of those regions. So I have to import air compressors from Europe or large pressure vessels from China and we get impacted by the tariffs coming in from those products, and it affects our margins as well. We are either dropping our margin to maintain some market share or we turn that over to our customers, but at the end of the day, if everything costs more, you become less competitive and that forces other people to start looking elsewhere.So it's definitely affected our business and our manufacturing capabilities, here at AirSep Amherst. Again, unfortunately we start losing market share. So that's how it's affected us as a manufacturer.Governor Hochul: And then even when this does some days settle down, how do you get that back? You have to start over again to develop the relationshipsAngelo Barberic: You know what, here's the good thing, I'll be honest with you. American products are still highly sought out for it. Everyone is looking to make a profit, right? We're in the business to generate revenue, and when that's wiped out, that becomes an issue, so they start looking elsewhere. But everyone loves American-made.I have to tell you that I've traveled extensively through Africa, because I deal with lower middle income countries with oxygen plants because of COVID. We've been very busy at AirSep for oxygen concentrators and large plants for hospital supplies because you've become independent, you're creating your own oxygen, which is unusual in these countries. So COVID brought that awareness and our business has flourished unbelievably. But it's gotten to the point where now it's really affecting our business and sales level.AJ Baynes: Governor, I believe you're very familiar with Rebecca Brady, a 43 North winner, owner of Top Seedz, an organic gluten-free cracker and snacks manufacturer located now in downtown Buffalo.Rebecca Brady, Owner, Top Seedz: Hi, Rebecca Brady, the top Seed at Top Seedz. Thank you very much for having us here. We have a 35,000 square foot facility in downtown Buffalo now, and we employ about 72 people.The tariffs have impacted us in a couple of ways, along with everyone else, our increased cost of ingredients. We buy our seeds and flowers from American companies who import them from all over the world. They have passed that price on to us for the tariffs that have been set on those products. We have absorbed that cost so our margins have decreased. We are at a ceiling with the price – it's a premium product, so it is $10-11 as some of you all know and we really can't push that up. So, like I said, we've absorbed that increase in the cost of goods and, as we are a rapidly growing company, we are just pouring those profits back into the business. We aren't taking that out, but the less we have to put back in, the slower our growth is.So that's one way, the other way is the chaos and confusion that Jim was talking about. A few operational challenges. Recently I attended an airline trade show, which has a huge opportunity for us to get onto the airlines as a snack. We're a number three delicious snack, so why not, right? But doing a feasibility study and looking at the equipment, all the quotes we got for equipment had that line item plus tariff, and there was usually no price associated with that so it was a gamble and we didn't want to risk it. We're a good, profitable business at the moment, so why take that risk when we don't really know what we're getting into? So that project has been put on hold until we really know what we're getting into and whether it's really an option for us to purchase that equipment.Governor Hochul: That's a real shame that a company like yours has growth potential, but the unknown of what the tariffs might be when they literally put that on the RFPs. And I presume that's happening elsewhere. That's going to stifle people's ability to expand and seize new opportunities because you cannot make a commitment without knowing what your costs are going to be.Rebecca Brady: Yeah and it could literally double the price of the equipment that you're getting.AJ Baynes: I'd like to introduce Jon Notarius, Vice President of Premier Wines and Spirits. No stranger to anybody in this room.Jon Notarius, Owner, Premier Wines & Spirits: Thank you. Echoing the comments in the room the uncertainty of when to buy things, how much stuff costs, delivery costs. In the wine business, if I go to Bordeaux and buy, for example, this happened in 2022 village of Bordeaux, bought a lot of wine. That wine doesn't come until 18 months later and it's not paid for. It's also based on the Euro and a lot of people don't realize the difference in the Euro compared to where it was 18 months ago is probably another 15 percent that's also caused by the tariffs. So it weakens the dollar, makes everything more expensive. So essentially I'm paying 20 to 30 percent more for things that we committed to two or three years ago. And unfortunately you can only pass a certain amount on to the consumer.The other thing that I think is really true in our business is that there's multiple levels. Because of the three tier system, you have an importer, you have a host salary, you have a sales person, you have a person delivering the product. Those are all affected by tariffs because we're buying less, we're selling less.New York has the most diverse selection of wine and liquor, probably of any state in the country because of the laws. There are maybe 100-200 boutique wholesalers, importers that operate in New York State, pay sales tax, pay wages, pay property tax. And I think this year probably 10-15 of them went out of business – directly related to tariffs. That's kind of the state of the wine and liquor business and I think there’s a misconception because a lot of people assume it's these multinational big companies. The majority of the businesses in New York are these small, 50-100 employee wholesale houses that are affected by this.Governor Hochul: It's interesting, I was just with the plaintiff in the lawsuit against the Trump administration that resulted in the Supreme Court declaring that the tariffs were illegal. It was DOS importers from Manhattan was one, Schwartz was his last name. Turns out his best friend was a classmate of mine at Hamburg High School and was my English teacher's son. So I'm in Manhattan drawing my Western New York connection once again. So he brought the lawsuit and was just talking about how he's had to freeze his business and the uncertainty and he had a whole ray of New York wines and he says he can't sell the New York wines to other countries, especially Canada because they're so angry at us. So that has killed that side of his business.Jon Notarius: Yeah and that's a perfect example. He probably has maybe 85 to 90 percent imported wine. So he'll be, if something's not done, he would be probably out of business.Governor Hochul: And he's been there for decades and decades so it has a real effect. So hang in there. We love Premier.Jon Notarius: Thank you.AJ Baynes: At this time I'd like to afford the media an opportunity to exit. I believe you're heading up to the third floor.John Percy, President, Destination Niagara USA: Governor, thank you. First thank you for your support of “I Love New York” and tourism in this state. You know that it is one of the top industries across the entire state. Our number one in Niagara County has grown to number one, it's even surpassed agriculture and we love our friends in agriculture, but it has surpassed that.We are not affected directly by tariffs. It's an intangible product, unlike these wonderful business owners and people that represent different businesses that have a tangible product that is being affected. We're affected by the actions and words taken by this administration – the policies that are put in place, or the uncertainty of the policies that are put into place. People don't realize, is my hotel room, my attraction ticket, going to be hit with tariffs? It's even just the negative perception that it has created from not only Canada, but many other countries. We are visited by over a hundred countries in Niagara Falls and Niagara County over an annual period. And many of those countries are taking a second look. As you mentioned earlier, when we lose that market share, I worry about that because it will take us years to regain that market share.We have lost international business. India is our number one inbound market internationally, besides Canada and Mexico have always been number one in the US. India has popped up to number two – UK first and India number two. We've lost 6 percent of that business from some of the policies that have been put in place or the uncertainty of policy.There was a $250 fee put on someone that wanted to do a visa. That's in addition to the Visa fee. So if you have a family of four that's an additional thousand dollars. Last year we did see a decrease in our business. We have been on a forward path. We've tripled the amount of business since 2010 in Niagara County to, at one point, almost a $1.2 billion industry in Niagara County for tourism. And last year is the first year, besides COVID 2020 of course we all saw a downward trend, but last year was a downward trend for the first time in many years.That's just very unfortunate because tourism is a viable industry. It's an intangible industry, but we manufacture experiences and people, when they have that negative perception from various countries, Canada included, they will turn elsewhere. Other countries are swooping in – Australia, Switzerland, many others – and finding that gap where people want to travel but not to the US and they will become a customer of that country and it will take us years to get that back.Governor Hochul: We call that an unforced error. That is something that did not have to be, it was not pre-ordained by other circumstances other than the decision by this administration on the tariffs, but also the hostility toward countries like Canada.Losing that tourism is tough because people are going to start getting conditioned to going elsewhere for their entertainment and not coming to our country. Certainly the Canadians are in that category, but other countries as well. Also, I'll just add this, there's a tremendous fear of people coming from other countries who are afraid of getting caught up in some ICE enforcement or Border Patrol enforcement because they're just not sure. They know that if they don't look like they were born in this country, that they are vulnerable to this and there's plenty of stories. So there's that dual effect of not sure if you're going to get harassed or detained or questioned, which you would not have had to experience before, in addition to the costs of everything going up. Actually it's a triple effect, just the hostility and their reaction to it.Tourism is a bread and butter industry for New York – from the tips of Long Island to the North Country to Western New York – and I don't know a single part of our state that's not been affected, but probably none more so than right on the border in Niagara Falls and CanadaJohn Percy: They're a neighborhood, they're not just another country. They're neighborhoods separated by a 500 foot bridge. In addition, I sit on the American Bus Association Board of Directors and on a national basis people buy motor coaches and we have many motor coach companies across the state that purchase motor coaches. Most are manufactured in Canada. When you're looking at a $750,000, $800,000 motor coach, you add 25 percent, that motor coach has gone over to a million dollars and that's taken a negative impact because people are pulled back from purchasing and that will have a negative impact going forward.Governor Hochul: Thank you.
