Relates to the private activity bond allocation act of 2012

Summary of provisions

Section 1 of the bill sets forth the title of the act, "Private Activity Bond Allocation Act of 2012."

Section 2 of the bill sets forth legislative findings.

Section 3 of the bill defines terms.

Sections 4 through 6, 8 through 10 and 16 of the bill detail the allocation formula for the distribution of private activity bond volume ceiling ("IDB Cap"), which can be generally described as follows: one-third of the IDB Cap is available to State agencies, one-third is available to local agencies (industrial development agencies ("IDAs")) and one-third is available to a statewide bond reserve for use by both the State and IDAs.

Section 7 of the bill sets forth certain requirements and conditions relating to access to new employment opportunities created in connection with industrial or manufacturing projects financed through the issuance of qualified small issue bonds.

Section 11 of the bill would authorize and describe the process for future allocations of the statewide ceiling for certain multi-year housing development projects.

Sections 12 and 13 of the bill detail provisions relating to year-end recapture of IDB Cap to the statewide bond reserve and procedures for carryforward elections of IDB Cap, respectively.

Section 14 of the bill would create a New York State Bond Allocation Policy Advisory Panel to provide policy advice regarding the priorities for distribution of the statewide ceiling.

Section 15 of the bill sets forth a severability provision.

Section 17 of the bill would prohibit the proposed legislation from superseding, altering or impairing any allocation of IDB Cap made under federal law and prior to the effective dale of the legislation.

Section 18 of the bill would provide for an immediate effective date.

Existing law

Many provisions of the Private Activity Bond Allocation Act of 2011 expire on January 1, 2012.

Prior legislative history

Similar bills have been enacted on an annual basis. See Chapter 71 of the Laws of 2011; Chapter 214 of the Laws of 2010; Chapter 180 of the Laws of 2009; Chapter 110 of the Laws of 2008; Chapter 593 of the Laws of 2007; Chapter 228 of the Laws of 2006; Chapter 79 of the Laws of 2005; Chapter 27 of the Laws of 2004; Chapter 32 of the Laws of 2003; Chapter 97 of the Laws of 2002; and Chapter 15 of the Laws of 2001.

Statement in support

The Federal Tax Reform Act of 1986 (the "1986 Act"), as amended, imposes a ceiling on the volume of tax-exempt, private activity and certain other bonds that may be issued in a state in any given year. It also establishes an allocation formula which provides 50% of the statewide IDB Cap to State agencies and the remaining 50% to local governments. The 1986 Act authorizes states to enact different formulas for allocating the volume cap. Beginning in 1987, New York State opted to establish an alternative method of distribution in which one-third of the IDB Cap is available to State agencies, one-third to IDAs and one-third to a statewide bond reserve for use by both the State and IDAs.

Since that time, annual legislation has adopted on a yearly basis, the alternative formula. The current bill continues the existing allocation formula, and makes only one substantive change dealing with the expiration date of the bill. The current bill extends the formula for 2 years rather than 1 year. Allowing the allocation formula (in place now for almost twenty-five years, but subject to yearly expiration) to extend beyond one year will allow for a more orderly and efficient method of allocating volume cap. It will aid planning and boost economic development activities in the State.

Budget implications

None.

Effective date

This bill takes effect immediately.