S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                  7083

                            I N  S E N A T E

                             April 24, 2014
                               ___________

Introduced  by  Sen. KRUEGER -- read twice and ordered printed, and when
  printed to be committed to the Committee on Finance

AN ACT to amend the executive law, in relation to cost benefit  analysis
  of tax expenditures

  THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1. Subdivision 1 of  section  181  of  the  executive  law  is
amended  by  adding  three  new  paragraphs  (c), (d) and (e) to read as
follows:
  (C) "COST BENEFIT ANALYSIS" SHALL MEAN, FOR TAX  EXPENDITURES  CLAIMED
BY  TAXPAYERS  SUBJECT  TO ARTICLES NINE (OTHER THAN SECTION ONE HUNDRED
EIGHTY), NINE-A, THIRTEEN-A, TWENTY-EIGHT, THIRTY-TWO, AND  THIRTY-THREE
OF  THE  TAX LAW, A METHOD OF DETERMINING A TAX EXPENDITURE'S BENEFIT TO
NEW YORK STATE BASED ON THE TAX EXPENDITURE  RECIPIENT'S  PROJECTED  JOB
CREATION  OR  JOB  RETENTION  AND/OR  INVESTMENT IN THE STATE VERSUS THE
TOTAL AMOUNT OF REVENUES FOREGONE UNDER THE  TAX  EXPENDITURE.  FOR  TAX
EXPENDITURES  CLAIMED  BY  TAXPAYERS  SUBJECT TO ARTICLES TWENTY-TWO AND
THIRTY-ONE OF THE TAX LAW, "COST BENEFIT ANALYSIS" SHALL MEAN  A  METHOD
OF  DETERMINING  A  TAX EXPENDITURE'S BENEFIT TO NEW YORK STATE BASED ON
THE AMOUNT OF TAX RELIEF A TAX EXPENDITURE PROVIDES TO PARTICULAR CLASS-
ES OF PERSONS OR ENTITIES.
  (D) "COST BENEFIT ANALYSIS RATIO" SHALL MEAN THE RATIO CALCULATED BY A
COST BENEFIT ANALYSIS OF A TAX EXPENDITURE.
  (E) "COST BENEFIT ANALYSIS TARGET RATIO" SHALL MEAN THE  COST  BENEFIT
ANALYSIS  RATIO  LEVEL THAT THE GOVERNOR DEEMS TO REFLECT A TAX EXPENDI-
TURE'S ADEQUATE LEVEL OF BENEFIT TO NEW  YORK  STATE  WHEN  TAKING  INTO
CONSIDERATION THE AMOUNT OF REVENUES THE STATE FOREGOES BECAUSE OF A TAX
EXPENDITURE  AND  THE  AMOUNT  OF  TAX  RELIEF  OR  JOB  CREATION OR JOB
RETENTION OR INVESTMENT IN THE STATE PROVIDED  OR  SUPPORT  BY  THE  TAX
EXPENDITURE.
  S  2.  Paragraphs  (f)  and (g) of subdivision 2 of section 181 of the
executive law, as added by chapter 23 of the laws of 1990,  are  amended
and  five new paragraphs (h), (i), (j), (k) and (l) are added to read as
follows:

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
              

                                                           LBD01248-01-3

S. 7083                             2

  (f) comment, if any, on the effectiveness and efficiency of other  tax
expenditures; [and]
  (g)  general  cautionary  and advisory notes concerning limitations of
data, estimation procedures, sampling errors and imputed values,  promi-
nently displayed[.]; AND
  (H) A COST BENEFIT ANALYSIS OF EACH TAX EXPENDITURE;
  (I)  A COMPARISON BETWEEN EACH TAX EXPENDITURE'S COST BENEFIT ANALYSIS
RATIO AND THE TAX EXPENDITURE'S TARGET RATIO, ALONG WITH AN  EXPLANATION
FOR ANY DIFFERENCE BETWEEN THE TWO RATIOS;
  (J)  AN  ANALYSIS  OF  WHETHER  EACH  TAX EXPENDITURE HAS SUCCESSFULLY
ACHIEVED THE PURPOSE FOR WHICH  THE  TAX  EXPENDITURE  WAS  ENACTED  AND
CURRENTLY  SERVES, INCLUDING AN ANALYSIS OF THE PERSONS OR ENTITIES THAT
ARE BENEFITED BY THE TAX EXPENDITURE;
  (K) AN EXPLANATION OF THE COST BENEFIT  ANALYSIS  FORMULA  APPLIED  TO
EACH TAX EXPENDITURE; AND
  (L) AN EXPLANATION OF EACH TAX EXPENDITURE'S TARGET RATIO, INCLUDING A
DESCRIPTION  OF  WHY THE RATIO REFLECTS ADEQUATE LEVELS OF TAX RELIEF OR
JOB CREATION OR JOB RETENTION OR INVESTMENT IN THE STATE.
  S 3. Subdivision 3 of section 181 of the executive law  is  renumbered
subdivision  5  and  two  new  subdivisions 3 and 4 are added to read as
follows:
  3. COST BENEFIT ANALYSIS FORMULA. THE GOVERNOR SHALL DEVELOP FOR  EACH
TAX EXPENDITURE A COST BENEFIT ANALYSIS FORMULA FOR DETERMINING THE COST
BENEFIT ANALYSIS RATIO.
  4.  COST  BENEFIT  ANALYSIS TARGET RATIO. THE GOVERNOR SHALL DETERMINE
FOR EACH TAX EXPENDITURE A COST BENEFIT ANALYSIS TARGET RATIO.
  S 4. This act shall take effect on the first of January next  succeed-
ing the date on which it shall have become a law.