What's happening
This bill allows the New York State industrial development agency to provide loans, grants, and seed or early-stage equity funding to businesses.
Why it matters
Expands economic development tools. By allowing the agency to issue loans, grants, and equity investments, the bill gives the New York State industrial development agency more flexibility to support businesses at different stages, potentially attracting a wider range of companies and projects.
Supports local entrepreneurship and startups. The inclusion of seed and early-stage equity funding means the agency can directly invest in innovative startups, which is especially important for fostering new business growth and job creation within the state.
Promotes accountability and local benefit. The requirement that funds be returned if a company leaves the municipality within a set timeframe ensures that public investments produce lasting local economic benefits, discouraging companies from taking advantage of funding without committing to the community.
Increases competition for economic development funds. Allowing both private and public corporations, as well as other legal entities, to access these resources could increase competition for limited funds, potentially raising questions about how projects are prioritized and evaluated for public investment.
Albany, before your first meeting.
Every bill that moved yesterday, summarized in a sentence and ranked by impact. The Albany Scorecard follows on Sundays.
Free. Unsubscribe in one click. Want alerts on specific bills? Create an account.
Who cares
Headline styles
Expand IDA Funding Powers
Plain English, a few words. Used as the page title.
Sponsors
2 Co-sponsors
History
- Referred to local government
- Referred to local government
Companion bill
The same bill in the other chamber. A bill becomes law when one version passes both houses and the governor signs it, so either number can carry it.
Allow IDA Loans and Grants
In Assembly Committee · Local Governments · Sponsor Fred Thiele
Full text
1 pageUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
1067
2019-2020 Regular Sessions
IN SENATE
January 10, 2019
Introduced by Sens. GALLIVAN, AKSHAR, GRIFFO -- read twice and ordered printed, and when printed to be committed to the Committee on Local Government
AN ACT to amend the general municipal law, in relation to the powers of the New York state industrial development agency
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. Subdivisions 16 and 17 of section 858 of the general municipal law, as renumbered by chapter 356 of the laws of 1993, are renumbered subdivisions 19 and 20 and three new subdivisions 16, 17 and 18 are added to read as follows:
(16) To provide loans to any private or public corporation or any legal entity provided said loan is memorialized in an appropriate loan agreement and further provided that the loan proceeds are used in furtherance of the agency's corporate purposes;
(17) To provide grants to any private or public corporation or any legal entity provided said grant is memorialized in an appropriate grant agreement stipulating the services to be provided in furtherance of the agency's corporate purposes;
(18) Notwithstanding any other law, to provide seed and early-stage equity funding to any private corporation or any legal entity, in accordance with a plan to be developed by the agency, located within, or to be located within, the municipality for whose benefit the agency was created and that is in the seed, early stage or venture stage of development and that has the potential to generate additional economic activity in New York state provided, however, that funds received by the beneficiary private corporation or legal entity shall be returned if the beneficiary private corporation or legal entity leaves the municipality for whose benefit the agency was created within a period of time to be established by the agency;
§ 2. This act shall take effect immediately.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD00199-01-9
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Sponsor's memo
Title of bill
An act to amend the general municipal law, in relation to the powers of the New York state industrial development agency
Purpose or general idea of bill
This bill would provide the necessary authority to Industrial Develop- ment Agencies to provide loans, grants or early-stage equity funding to public or private entities.
Summary of specific provisions
Section 1 amends subdivision (14) of Section 854 of the General Munici- pal Law by changing the definition of the term "Financial assistance" to include the proceeds of a loan, the proceeds of a grant, with certain exceptions, and equity funding, thus making funds held for an IDA's own use and account available for IDA corporate purposes.
Section 2 amends the general municipal law to authorize IDAs to provide loans, grants and seed and early-stage equity funding
Section 3 establishes the effective date.
Justification
Industrial Development Agencies (IDAs) are local governments' most important economic development tool. Staff of these IDAs work predomi- nately to help incumbent employers expand, invest and create jobs in their communities.
The primary financial incentives that IDAs provide to businesses are real property, sales and mortgage recording tax exemptions. Through a Payment-in-Lieu-of-Tax (PILOT) agreement, IDAs generate significant additional revenue for local taxing jurisdictions.
IDAs could be even more helpful, however, if they were given clear authority to make loans or grants as well as to make equity investments in seed stage or start-up businesses that meet the corporate purposes of their economic development mission. This bill would afford IDAs the ability to deploy tens of millions of dollars for economic development.
This version incorporates within the definition of "Financial assist- ance" the proceeds of a loan, grant and equity funding. By doing so, such proceeds will now be applicable to: (i) already existing prohibi- tions of the use of financial assistance, (ii) already existing purposes of an IDA, (iii) already existing and required reporting requirements to the comptroller, (iv) already existing and required application, public notice, public hearing, and required IDA resolution adoption require- ments, (v) already existing uniform criteria use and application of same with respect to an IDAs consideration of whether to provide financial assistance, (vi) already existing requirements for use of a uniform agency project agreement and such related terms and conditions, (vii) already existing restrictions on the use of the funds of an IDA, and (viii) already existing requirements related to an IDAs Uniform Tax
Exemption Policy and an IDAs policies for the suspension, discontinuance and/or return of financial assistance.
Legislative history
2017-18: S.6230a Referred to Local Government
Fiscal implications
None to the state.
Effective date
This act shall take effect on the ninetieth day after it shall have become law.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.