Relates to certification and decertification of businesses as empire zone enterprises; repealer

1 Co-sponsor

• George Winner

Title of bill

An act to amend the general municipal law and the tax law, in relation to certification and decertification of businesses as empire zone enterprises; creating a commission on regulatory reform and economic competitiveness; to repeal certain provisions of Part S-1 of chapter 57 of the laws of 2009, relating to enacting reforms to the empire zones program; relating to sales taxes; and to repeal certain provisions of the tax law relating to the carryover of certain tax credits and tax refunds of certain tax credits; and providing for the repeal of certain provisions upon expiration thereof

Purpose

This bill clarifies changes made to the Empire Zone Program during the creation of 2009-2010 State Budget.

Summary of provisions

This bill would:

1. Clarify that companies that have more than one Empire Zone location shall be reviewed in the aggregate when performing the newly established decertification tests.

2. Establish that grounds for decertification as a result of new ownership shall only occur when the change of ownership results in the new entity having a different tax identification number.

3. Clarify that decertification shall take place for tax years beginning on or after January 1, 2010.

4. Clarify that companies that switched their tax identification number in 2002 and prior shall not be decertified if they pass the cost benefit ration test established for all businesses, and; a. have wages, benefits and investments on their new employment ,greater than Empire Zone tax benefits received from the State; or, b. have wages, benefits and investments for their new employees greater than $30 million.

5. Eliminates provisions requiring business to obtain retention certificates for Empire Zone credits, carryovers and refunds to conform with the elimination of retroactive look back provisions.

6. Restores the sunset date for the empire zone designation back to June 30, 2011.

7. Restores the sales tax benefit back to an up-front exemption.

8. Restores the authorization for program benefits beyond January 1, 2012.

9. Eliminate Wasteful Regulations, Reduce Paperwork & Cut Red Tape: creates a Regulatory Reform and Competitiveness Commission to review all state regulations for their impact on the state's businesses. The Commission would include representatives from the large and small business community, as well as local government and labor, and, similar to the Berger Commission, make a recommendation to the State Legislature of regulatory revisions that would become law, unless the State Legislature passed superseding legislation.

In addition, all agencies would be required to identify the economic impact and cost to business of any and all proposed new regulations.

Existing law

This bill clarifies amendments made to the Empire Zone Law in the 2009-2010 State Budget.

Justification

The recent changes to the Empire Zone program would have long lasting negative economic impact on the state and destroy the reputation of this state with the global business community. The retroactivity of the changes to the program is a broken promise to those businesses located in this state that invested and grew jobs under a set of guidelines that the state suddenly changed when the budget picture looked dire. We must restore the most successful economic development program the state has had and try and repair our reputation with the business community so businesses will feel confident with locating and expanding in the empire state.

Legislative history

This is a new bill.

Fiscal implications

$90 million for fiscal year 2009-2010. To be determined for future years.

Local fiscal implications

To be determined.

Effective date

Immediately.