NY State Senate Bill 2017-S5015

Archive: Last Bill Status - In Senate Committee Finance Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jan 03, 2018	referred to finance
Mar 06, 2017	referred to finance

2017-S5015 (ACTIVE) - Details

Current Committee:: Senate Finance
Law Section:: Executive Law
Laws Affected:: Amd §181, Exec L
Versions Introduced in Other Legislative Sessions:: 2009-2010: S7347
2011-2012: S408
2013-2014: S7083
2015-2016: S3080
2019-2020: S2515
2021-2022: S852
2023-2024: S620

2017-S5015 (ACTIVE) - Summary

Requires governor to perform a cost benefit analysis of tax expenditures.

2017-S5015 (ACTIVE) - Sponsor Memo

                                 BILL NUMBER:  S5015

 TITLE OF BILL :  An act to amend the executive law, in relation to
cost benefit analysis of tax expenditures

 PURPOSE :

This legislation proposes to require the Governor to provide in the
annual Tax Expenditure Report more information -- including
cost/benefit analyses that better gauges the effectiveness and
efficiency of each tax expenditure.

 SUMMARY OF PROVISIONS :

§ 1. Amends subdivision 1 of section 181 of the following
definitions:the Executive Law to include analysis ratio" 3. "Cost the
Executive Law to

1. "Cost benefit analysis" 2. "Cost benefit benefit analysis target
ratio"

§ 2. Amends subdivision 2 of section 181 of include:

1. A cost/benefit analysis of each tax expenditure;

2. A comparison between each tax expenditures cost benefit analysis

ratio and the tax expenditure's target ratio, along with an
explanation for any difference between the two ratios.

3. 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.

4. An explanation of the cost benefit analysis formula applied to each
tax expenditure.

5. 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.

§ 3. Amends subdivision 3 of Section 181 of the Executive Law to
include the following:

1. The Governor shall develop for each tax expenditure a cost benefit
analysis formula for determining the cost benefit analyses ratio.

2. The Governor shall set for each tax expenditure a cost benefit
analysis target ratio.

 EXISTING LAW :

Section 181 of the Executive Law requires the Governor to submit to
the Legislature an annual Tax Expenditure Report no more than thirty
days after issuing the Executive Budget. The report shall contain
information and statements on the provisions of law authorizing the
tax expenditures and cost estimates on them. It shall also include any
recommendations of the Governor regarding continuing, modifying, or
repealing tax expenditures.

In cases when the Executive Budget includes proposals to expire,
modify or repeal a tax expenditure, the report shall contain an
analysis of the number and types of persons and entities benefiting or
expected to benefit from such tax expenditures, an estimate of the
costs of such tax expenditures for the coming fiscal year, and an
explanation of the reasons for the proposals. The explanation of
recommendations shall include comments on the effectiveness and
efficiency of tax expenditures plus general cautionary and advisory
notes concerning limitations of data, estimation procedures, sampling
errors and imputed values.

 JUSTIFICATION :

New York State has over 484 tax expenditures, some of which date back
to the 1890s. While the Governor's Tax Expenditure Report annually
reviews each tax expenditure's amount of reduced taxpayer liability to
the State, many of them have remained in law with little consideration
as to whether they are fulfilling their objectives to benefit the
public.

More than twenty years have passed since the Governor issued his first
Tax Expenditure Report in 1990. Yet New York still needs a more
rigorous tax expenditure review process. This review should employ
performance metrics which weighs economic activity against tax
assistance. Cost/benefit analyses on all tax expenditures would give
legislators a clearer understanding of the need to maintain, enhance
or sunset them. The Governor is already required to comment on a tax
expenditure's effectiveness and efficiency, but primarily when
recommending to expire, modify or repeal it.

 FISCAL IMPLICATIONS :

Slightly higher administrative costs stemming from requirements on the
Executive to perform tax expenditure cost/benefit analyses. Potential
cost savings through changes to inefficient tax expenditures.

 EFFECTIVE DATE :
This act shall take effect on the first of January next succeeding the
date it shall have become law.

2017-S5015 (ACTIVE) - Bill Text download pdf

                            
 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   5015
 
                        2017-2018 Regular Sessions
 
                             I N  S E N A T E
 
                               March 6, 2017
                                ___________
 
 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.
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD05800-01-7

 S. 5015                             2
 
   §  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:
   (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.
   §  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.
   §  4. This act shall take effect on the first of January next succeed-
 ing the date on which it shall have become a law.

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Senate Bill S5015

Sponsored By

Archive: Last Bill Status - In Senate Committee Finance Committee

2017-S5015 (ACTIVE) - Details

2017-S5015 (ACTIVE) - Summary

2017-S5015 (ACTIVE) - Sponsor Memo

2017-S5015 (ACTIVE) - Bill Text download pdf

Comments

Senate Bill S5015

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Sponsored By

Liz Krueger

Archive: Last Bill Status - In Senate Committee Finance Committee

2017-S5015 (ACTIVE) - Details

2017-S5015 (ACTIVE) - Summary

2017-S5015 (ACTIVE) - Sponsor Memo

2017-S5015 (ACTIVE) - Bill Text download pdf

Comments