S T A T E O F N E W Y O R K
________________________________________________________________________
5985--A
2017-2018 Regular Sessions
I N S E N A T E
May 9, 2017
___________
Introduced by Sens. BOYLE, DeFRANCISCO, AKSHAR, CROCI, HELMING, LANZA,
MURPHY, ORTT, SERINO -- read twice and ordered printed, and when
printed to be committed to the Committee on Commerce, Economic Devel-
opment and Small Business -- recommitted to the Committee on Commerce,
Economic Development and Small Business in accordance with Senate Rule
6, sec. 8 -- committee discharged, bill amended, ordered reprinted as
amended and recommitted to said committee
AN ACT to amend the economic development law, in relation to reporting
requirements for the START-UP NY program including specific data
relating to net new jobs
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. Notwithstanding the provisions of article 5 of the general
construction law, the provisions of section 438 of the economic develop-
ment law, as amended by section two of this act, are hereby revived and
shall continue in full force and effect as such provisions existed on
April 10, 2017.
§ 2. Section 438 of the economic development law, as added by section
1 of part A of chapter 68 of the laws of 2013, is amended to read as
follows:
§ 438. Disclosure authorization and reporting requirements. 1. The
commissioner and the department shall disclose publicly the names and
addresses of the businesses located within a tax-free NY area. In addi-
tion, the commissioner and the department shall disclose publicly and
include in the annual report required under subdivision two of this
section such other information contained in such businesses' applica-
tions and annual reports, including the projected number of net new jobs
to be created, as they determine is relevant and necessary to evaluate
the success of this program.
2. (a) The commissioner shall prepare an annual report to the governor
and the legislature NO LATER THAN APRIL FIRST, TWO THOUSAND NINETEEN AND
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD11124-04-8
S. 5985--A 2
ANNUALLY THEREAFTER. Such report shall include the number of business
applicants, number of businesses approved, the names and addresses of
the businesses located within a tax-free NY area, total amount of bene-
fits distributed, benefits received per business, number of net new jobs
created, net new jobs created per business, new investment per business,
the types of industries represented and such other information as the
commissioner determines is necessary to evaluate the progress of the
START-UP NY program. SUCH ANNUAL REPORT SHALL, AT A MINIMUM, INCLUDE
ANNUAL PROGRAM DATA AND INFORMATION ATTRIBUTABLE SOLELY TO THE PRECEDING
CALENDAR YEAR. IN ADDITION, SUCH REPORT SHALL INCLUDE CUMULATIVE ANNUAL
PROGRAM DATA INCLUDING ALL NET NEW JOBS PREVIOUSLY RECORDED, ADJUSTED
FOR NET NEW JOBS THAT HAVE BEEN SUBSEQUENTLY LOST. CUMULATIVE DATA SHALL
BE PRESENTED SEPARATE AND DISTINCT FROM ANNUAL PROGRAM DATA REPORTING.
SUCH REPORT SHALL BE POSTED AS A SEPARATE DOCUMENT ON THE DEPARTMENT'S
WEBSITE.
(b) Any business located in a tax-free NY area must submit an annual
report to the commissioner in a form and at such time and with such
information as prescribed by the commissioner in consultation with the
commissioner of taxation and finance. Such information shall be suffi-
cient for the commissioner and the commissioner of taxation and finance
to: (i) monitor the continued eligibility of the business and its
employees to participate in the START-UP NY program and receive the tax
benefits described in section thirty-nine of the tax law; (ii) evaluate
the progress of the START-UP NY program; and (iii) prepare the annual
report required by paragraph (a) of this subdivision. Such annual report
shall also include information regarding the wages paid during the year
to its employees employed in the net new jobs created and maintained in
the tax-free NY area.
§ 3. Subdivision 1 of section 433 of the economic development law, as
amended by section 3 of part UUU of chapter 59 of the laws of 2017, is
amended to read as follows:
1. In order to participate in the START-UP NY program, a business must
satisfy all of the following criteria.
(a) The mission and activities of the business must align with or
further the academic mission of the campus, college or university spon-
soring the tax-free NY area in which it seeks to locate, and the busi-
ness's participation in the START-UP NY program must have positive
community and economic benefits.
(b) The business must demonstrate that it will, in its first year of
operation, create net new jobs. After its first year of operation, the
business must maintain net new jobs. In addition, the average number of
employees of the business and its related persons in the state during
the year must equal or exceed the sum of: (i) the average number of
employees of the business and its related persons in the state during
the year immediately preceding the year in which the business submits
its application to locate in a tax-free NY area; and (ii) net new jobs
of the business in the tax-free NY area during the year. The average
number of employees of the business and its related persons in the state
shall be determined by adding together the total number of employees of
the business and its related persons in the state on March thirty-first,
June thirtieth, September thirtieth and December thirty-first and divid-
ing the total by the number of such dates occurring within such year.
(c) Except as provided in paragraphs [(f)] (G) and [(g)] (H) of this
subdivision, at the time it submits its application for the START-UP NY
program, the business must be a new business to the state.
S. 5985--A 3
(d) The business may be organized as a corporation, a partnership,
limited liability company or a sole proprietorship.
(e) UPON COMPLETION OF ITS FIRST YEAR IN THE START-UP NY PROGRAM AND
THEREAFTER, THE BUSINESS MUST COMPLETE AND TIMELY FILE THE ANNUAL REPORT
REQUIRED UNDER SECTION FOUR HUNDRED THIRTY-EIGHT OF THIS ARTICLE.
(F) Except as provided in paragraphs [(f)] (G) and [(g)] (H) of this
subdivision, the business must not be engaged in a line of business that
is currently or was previously conducted by the business or a related
person in the last five years in New York state.
[(f)] (G) If a business does not satisfy the eligibility standard set
forth in paragraph (c) or [(e)] (F) of this subdivision, because at one
point in time it operated in New York state but moved its operations out
of New York state on or before June first, two thousand thirteen, the
commissioner shall grant that business permission to apply to partic-
ipate in the START-UP NY program if the commissioner determines that the
business has demonstrated that it will substantially restore the jobs in
New York state that it previously had moved out of state.
[(g)] (H) If a business seeks to expand its current operations in New
York state into a tax-free NY area but the business does not qualify as
a new business because it does not satisfy the criteria in paragraph (c)
of subdivision six of section four hundred thirty-one of this article or
the business does not satisfy the eligibility standard set forth in
paragraph [(e)] (F) of this subdivision, the commissioner shall grant
the business permission to apply to participate in the START-UP NY
program if the commissioner determines that the business has demon-
strated that it will create net new jobs in the tax-free NY area and
that it or any related person has not eliminated any jobs in the state
in connection with this expansion.
§ 4. This act shall take effect immediately.
