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Sponsors
Senator · Senate District 57
No co-sponsors yet.
History
- Reported and committed to rules
- Referred to commerce, economic development and small business
Companion bill
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Reduces the number of new jobs which must be created by an applicant for eligibility under the excelsior jobs program
In Assembly Committee · Ways And Means · Sponsor Robin Schimminger
Full text
The text isn't available here yet. Check nysenate.gov.
Sponsor's memo
Title of bill
An act to amend the economic development law, in relation to eligibility to participate in the excelsior jobs program
Purpose
To reduce the requisites for participation in the Excelsior Jobs Program to help make the program a more effective catalyst for the establishment of new targeted businesses fields in the state.
Summary of provisions
Section one amends subdivision 16 of section 352 of the economic development law to reduce the number of net new jobs which must be created to constitute a "regionally significant project" under the Excelsior Jobs Program. The proposed new job creation thresholds would go from 50 to 10 for manufacturing entities; 20 to 10 for agricultural entities; 300 to 100 in financial services firms, distribution centers; or back office operations; 20 to 10 in scientific, research or development firms, and from 300 to 150 for other businesses making a significant capital investment in the state.
Read the full memo (823 words)
The bill also adds a new section 20(a) to define "a significant capital investment" in statute rather than through regulations of the department of economic development. A "regionally significant project" is defined to include a new facility or a newly constructed addition to, expansion of, or improvement of a depreciable facility which has a useful life of 4 or more years, has a purchase price that equals or exceeds (1) $1 million for a manufacturer (currently at $5 million and 50 jobs created) (2) $250,000 for an agricultural business (currently at $500,000 and 20 jobs created)(3) $3 million for a financial services firm or back office operation (currently $6 million and 300 new jobs) (4) $15 million for a distribution center (currently at $3 million and 300 new jobs) (5) $5 million for scientific research facility, (currently $20 million and 20 new jobs)and (6) $3 million for other businesses (currently $6 million and 300 new jobs)or three million dollars and 250 new jobs for other businesses.
Section 2 amends subdivisions 3 and 4 of section 353 of the economic development law to make conforming changes for the job creation threshold established in section 352 of the economic development law.
Justification
The Excelsior Jobs program was designed to provides job creation and investment tax credit incentives to firms in targeted industries including biotechnology, pharmaceuticals, high tech, clean technology, green technology, financial services, manufacturing, and agriculture. The program was designed to encourage businesses to expand in and relocate to to New York while maintaining job creation and investment accountability.
This legislation is intended to make the Excelsior Jobs tax credit program more accessible to small business attempting to invest and grow in New York State, especially in the state's hard-hit manufacturing sector. To do so, it generally reduces the job creation and capital investment thresholds for a business to be eligible for consideration of Excelsior tax credits. The awarding of credits, and the determination of credits to be offered, remain at the discretion of Empire State Development.
Based on recent federal data, 78 percent of all firms in New York State have less than 10 employees, and 89 percent have less than 20. More than half of all manufacturing businesses have less than 10 employees, and 70 percent have less than 20. For these small businesses, the Excelsior thresholds are unreasonably high. A manufacturer is required to create 10 new jobs, or 50 new jobs plus a significant capital investment, just to be considered for state assistance under Excelsior. Other sectors have even higher jobs criteria.As a result, the program is doing too little to promote economic development in New York State. Much of upstate New York remains flat in terms of private sector job creation, and the state's manufacturing sector continues to underperform national trends.
When the Excelsior Jobs program was adopted in 2010 as a replacement for the Empire Zones Program, it was described as the new "centerpiece" of the state's economic development efforts. It was intended to promote investments and job creation in key sectors including high tech, manufacturing, agriculture and others.Since then, the program has significantly underperformed, with the most recent annual report showing that for program years 2011 through 2014, less than $40 million in tax credits were awarded out of $500 million available. That same report notes that the program now has just 400 companies admitted to the program, and that there is $633 million in credits "committed" to business, out of the $2.2 billion in credits authorized under the original statute.
This legislation is intended to make the program more accessible to small businesses that are growing jobs and making capital investments in New York State. Threshold adjustments adopted in 2013 have had some impact on participation, but the program is still "leaving money on the table," and in doing so, missing important opportunity to provide new jobs for New Yorkers.
Legislative history
New Bill.
Fiscal implications
Undetermined.
Effective date
This act shall take effect immediately.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.