What's happening
This bill requires New York's tax commissioner to use a third-party evaluator to assess and report on the effectiveness of state tax incentives.
Why it matters
Brings independent oversight. By requiring a third-party evaluator, the bill aims to ensure that reviews of state tax incentives are unbiased and not influenced by internal political or departmental pressures.
Improves transparency and accountability. The mandated reports must include detailed data on who receives tax breaks, how much is spent, and whether those incentives achieve their intended goals, equipping lawmakers and the public with clearer information on program effectiveness.
Enables data-driven policy decisions. By analyzing similar programs in other states and offering recommendations to maintain, change, or eliminate incentives, the bill seeks to ensure New York’s tax incentive policies are based on evidence rather than tradition or political pressure.
Establishes regular review cycle. The requirement for comprehensive and periodic (every three years) evaluations helps keep state tax programs up-to-date and responsive to evolving economic conditions, potentially saving taxpayer money or redirecting it to more effective uses.
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Who cares
Department of Taxation and Finance
The commissioner would have to use a third-party evaluator to report on state economic development tax benefits and their effectiveness.
Businesses receiving state tax incentives
The evaluator would recommend which incentives to maintain, change or eliminate, potentially affecting benefits these businesses receive.
State legislators
The legislature would receive a comprehensive initial report and follow-up reports every three years evaluating materially changed incentives and conditions.
Third-party tax policy evaluators
The bill would require outside evaluation of incentive costs, utilization, economic effectiveness and comparable programs in other states and cities.
Headline styles
Audit State Tax Breaks
Plain English, a few words. Used as the page title.
Sponsors
1 Co-sponsor
History
- Reported and committed to rules
- Reported and committed to finance
- Referred to investigations and government operations
- Returned to senate
- Died in assembly
- Referred to ways and means
- Delivered to assembly
- Passed senateVote 62–0
- Ordered to third reading cal.2168
- Committee discharged and committed to rules
- Referred to investigations and government operations
Full text
2 pagesUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
5937
2017-2018 Regular Sessions
IN SENATE
May 8, 2017
Introduced by Sen. JACOBS -- read twice and ordered printed, and when printed to be committed to the Committee on Investigations and Government Operations
AN ACT to direct the commissioner of taxation and finance to utilize a third-party evaluator for investigating the effectiveness of state tax incentives
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. The commissioner of taxation and finance shall utilize a third-party evaluator to prepare reports, pursuant to the schedule set forth in section two of this act, which shall include the following:
(a) a listing and description of tax exemption, abatement, credit or other benefits allowed against state tax liability for the purpose of spurring economic development, whether against the rate of the tax, the subject on which the rate is applied or the payment amount due;
(b) the eligibility requirements for, and general objectives of, each such tax benefit;
(c) aggregate data regarding utilization of each such tax benefit. For benefits with respect to which taxpayers are eligible to carry over benefits into future tax years, aggregate amounts carried over per tax benefit shall be identified;
(d) the total amount of tax benefits received by taxpayers with respect to each such tax benefit;
(e) an assessment, including such data and supporting documentation as is meaningful and available, regarding the economic effectiveness and other consequences of the provision of such tax benefit currently and as anticipated going forward;
(f) an analysis of similar incentives and benefits provided in other states and cities, including an assessment of the success of such incentives in such states and cities in comparison with comparable current state programs; and
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD11474-01-7
S. 5937 2
(g) recommendations as to which state incentives and benefits should be maintained, changed or eliminated in order to best promote the objectives of the state with respect to the use of such programs.
§ 2. The first report shall be a fully comprehensive report covering all tax incentive and exemption programs in effect as of the first of January preceding the effective date of this act, and shall be submitted to the legislature no later than the first of January following the effective date of this act. A report evaluating materially changed state incentives and benefits, and any other materially changed conditions, shall be provided every three years to the legislature with respect to the period since the last report.
§ 3. This act shall take effect one year after it shall have become a law.
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Sponsor's memo
Title of bill
An act to direct the commissioner of taxation and finance to utilize a third-party evaluator for investigating the effectiveness of state tax incentives
Purpose
The purpose of this legislation is to provide oversight and measure the effectiveness of the state's tax incentives
Summary of provisions
§ 1 - Directs the commissioner of taxation and finance to utilize a third-party evaluator to prepare reports on the state's tax incentives, with such reports to include the following:
a) a listing and description of the state's various tax incentives created for the purpose of spurring economic development;
b) the eligibility requirements and objectives of each tax incentive;
c) aggregate data regarding utilization of each tax incentive;
d) the total amount of tax benefits received by the taxpayers with respect to each tax incentive;
e) an assessment of the economic effectiveness and other consequences of a tax incentive currently and as anticipated;
f) an analysis of similar incentives provided in other states and cities, an assessment of the success or failure of the foreign incentives as compared to New York's incentives; and
g) recommendations as to which incentives should be maintained, changed or eliminated in order to accomplish the state's objective with regard to each incentive.
§ 2 - Directs that the first such report undertaken by the commissioner of taxation and finance shall be fully comprehensive of all the state's tax incentive programs in currently in effect, to be submitted to the legislature no later than January 1 following the effective date herein; with ensuing reports to be undertaken and reported to the legislature, every three years with respect to the period since the last report
§ 3 - Establishes the effective date.
Justification
Every year New York provides millions of dollars in tax incentives as a means of spurring economic growth, or achieving other state objectives. Currently, however, no oversight exists outside of the executive to inform New Yorkers how effective such incentives actually are in accomplishing their purported objective. This bill would establish such outside oversight so that New Yorkers and their elected representatives, as stewards of the public's money, can most prudently and responsibly design the state's tax incentive structure.
Legislative history
None.
Fiscal implications
To be determined. EFFECTIVE DATE : This act shall take effect one year after it shall have become a law.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.