* § 35. Economic transformation and facility redevelopment program tax
credit. (a) General. (1) A taxpayer which is a participant or the owner
of a participant in the economic transformation and facility
redevelopment program under article eighteen of the economic development
law that is subject to tax under article nine-A, twenty-two or
thirty-three of this chapter shall be allowed the sum of following
components against such tax, pursuant to the provisions referenced in
subdivision (f) of this section.

(A) the economic transformation and facility redevelopment program
jobs tax credit component;

(B) the economic transformation and facility redevelopment program
investment tax credit component;

(C) the economic transformation and facility redevelopment program job
training credit component; and

(D) the economic transformation and facility redevelopment program
real property tax credit component.

(2) A taxpayer which is a participant in the economic transformation
and facility redevelopment program under article eighteen of the
economic development law, or such participant's contractor, shall be
allowed a sales tax refund as provided in subdivision (f) of section one
thousand one hundred nineteen of this chapter.

(3) To be eligible for the economic transformation and facility
redevelopment program tax credit, the taxpayer must meet all the
following requirements.

(A) The taxpayer must be a participant or the owner of a participant
in the economic transformation and facility development program. The
commissioner of economic development must have issued a certificate of
eligibility pursuant to section four hundred two of the economic
development law to the taxpayer or to an entity in which the taxpayer is
an owner. A copy of the certificate shall be attached to the taxpayer's
report or return.

(B) The taxpayer or the entity in which the taxpayer is an owner must
be a qualified new business as defined in subdivision (e) of this
section.

(C) The taxpayer or the entity in which the taxpayer is an owner must
create and maintain at least five net new jobs in the economic
transformation area.

(4) The benefit period for the tax credits under articles nine,
nine-A, twenty-two, thirty-two and thirty-three of this chapter is five
consecutive taxable years, beginning with the first taxable year in
which the five net new jobs are created. However, in no event may that
benefit period start later than two years after the certificate of
eligibility is issued. If, in any year of the benefit period, the
taxpayer fails to maintain the required level of five net new jobs
(measured quarterly), the taxpayer will not be allowed a credit for that
year. Such failure to be allowed a credit will not extend the taxpayer's
benefit period.

(b) Election of credit. No cost or expense paid or incurred by the
taxpayer or the entity in which the taxpayer is an owner that is the
basis for any of the above named credits shall be the basis for any
other tax credit under this chapter. If a taxpayer elects to claim an
economic transformation and facility redevelopment program tax credit,
the election is irrevocable.

(c) Information sharing. (1) Notwithstanding any provision of this
chapter, employees and officers of the department of economic
development and the department shall be allowed and are directed to
share and exchange:

(A) information derived from tax returns or reports that is relevant
to a taxpayer's eligibility to participate in the economic
transformation and facility redevelopment program;

(B) information regarding the credits applied for, allowed, or claimed
pursuant to this section and taxpayers who are applying for the credits
or who are claiming the credits; and

(C) information contained in or derived from credit claim forms
submitted to the department and applications for admission into the
economic transformation and facility redevelopment program.

(2) Other than the information required to be contained in the report
issued pursuant to subdivision (d) of this section, all information
exchanged between the department of economic development and the
department shall not be subject to disclosure or inspection under the
state's freedom of information law.

(d) Economic transformation and facility redevelopment program tax
credits report. (1) The commissioner must publish an economic
transformation and facility redevelopment program tax credits report
annually by July thirty-first. The first report shall be due July
thirty-first, two thousand thirteen.

(2) The credits report shall contain the following information about
the economic transformation program and facility redevelopment tax
credits claimed under this chapter during the previous calendar year:

(A) the name of each taxpayer claiming a credit; provided however, if
the taxpayer claims a credit because the taxpayer is a member of a
limited liability company, a partner in a partnership or a shareholder
in a New York subchapter S corporation, the name of each limited
liability company, partnership or New York subchapter S corporation
earning any of the credit must be included in the report instead of
information about the taxpayer claiming the credit; and

(B) the amount of each credit earned by each taxpayer; provided
however, if the taxpayer claims a credit because the taxpayer is a
member of a limited liability company, a partner in a partnership or a
shareholder in a New York subchapter S corporation, the amount of credit
earned by each entity must be included in the report instead of
information about the taxpayer claiming the credit.

(3) The credit report may also contain any other information received
by the commissioner with regard to the economic transformation and
facility redevelopment program tax credits that the commissioner deems
to be useful in evaluating the use of the credits. The information
included in the credit report will be based on the information filed
with the department during the previous calendar year, to the extent
that it is practicable to use that information.

(e) Definitions. (1) The terms "participant", "net new jobs",
"economic transformation area", "related person", "certificate of
eligibility", "benefit-cost ratio", and "qualified investment" shall
have the same meaning as those terms have in section four hundred of the
economic development law.

(2) The term "qualified new business" means a business entity that
satisfies all of the following tests:

(A) the business entity must not be currently operating or located
within the economic transformation area in which it is applying for
certification under article eighteen of the economic development law;

(B) the business entity must not be moving existing jobs into the
economic transformation area in which it is applying for certification
under article eighteen of the economic development law from another area
of the state;

(C) the business entity must not be substantially similar in ownership
and operation to another taxpayer taxable or previously taxable under
section one hundred eighty-three or one hundred eighty-four or former
section one hundred eighty-five of article nine, former section one
hundred eighty-six of this chapter or article nine-A, twenty-two or
thirty-three of this chapter or former article thirty-two of this
chapter or the income or losses of which is or was includable under
article twenty-two of this chapter;

(D) the business entity must not have caused individuals to transfer
from existing employment in New York with another business entity with
similar ownership to similar employment with the business entity;

(E) the business entity must not have acquired, purchased, leased, or
had transferred to it real property located in the economic
transformation area in which it is applying for certification if that
real property was previously owned by an entity with similar ownership,
regardless of form of incorporation or organization; and

(F) the business entity must not be substantially similar in operation
to a business entity from which it has acquired real or tangible
personal property that is located in the economic transformation area in
which it is applying for certification under article eighteen of the
economic development law.

(3) The term "entity in which the taxpayer is an owner" shall mean a
limited liability company in which the taxpayer is a member, a
partnership in which the taxpayer is a partner and a New York subchapter
S corporation in which the taxpayer is a shareholder.

(f) Cross-references. For application of the credits provided for in
this section, see the following provisions of this chapter:

(2) article 9-A: section 210-B(35).

(3) article 22: section 606 (ss).

(4) article 33: section 1511 (aa).

(g) Economic transformation and facility redevelopment program jobs
tax credit. A taxpayer which meets the requirements in this section
shall be eligible to claim a credit for each net new job that the
taxpayer creates in the economic transformation area with respect to the
project for which the certificate of eligibility is issued. The amount
of such credit per job shall be equal to the product of the gross wages
paid and 6.85 percent.

(h) Economic transformation and facility redevelopment program
investment tax credit. (1) A taxpayer which meets the requirements in
this section shall be eligible to claim a credit on qualified
investments with respect to the project for which the certificate of
eligibility is issued. The credit shall be equal to ten percent of the
cost or other basis for federal income tax purposes of the qualified
investment at a closed facility. Provided however, for purposes of this
credit only, a taxpayer that is the owner of a closed facility described
in paragraph (d) of subdivision eleven of section four hundred of the
economic development law, shall be allowed to include in its cost or
other basis of the qualified investment at the closed facility, any
demolition costs incurred at such closed facility. Those demolition
costs shall be limited to the following costs: (i) asbestos removal
costs, (ii) rental of demolition equipment, (iii) personnel costs to
operate the demolition equipment, (iv) costs to remove and dispose of
demolition debris, (v) the costs of any permits, licenses and insurance
necessary for the demolition. The total amount of investment tax credit
allowed for all eligible participants under this subdivision for
qualified investments located at each closed facility shall not exceed
eight million dollars. The credit shall be equal to six percent of the
cost or other basis for federal income tax purposes for all other
qualified investments, but the credit allowed to a taxpayer may not
exceed four million dollars.

(2) Costs incurred prior to the date the certificate of eligibility is
issued are not eligible to be included in the calculation of the credit.
A taxpayer which is a participant in the economic transformation and
redevelopment program or is an owner of an entity that is a participant
is not eligible for any other investment tax credit provided under this
chapter.

(3) If the taxpayer is a partner in a partnership, member of a limited
liability company or shareholder of a New York S corporation, then the
four million dollar limit imposed above by the preceding sentences shall
be applied at the entity level, so that the aggregate credit allowed to
all the partners, members or shareholders of each such entity in the
taxable year does not exceed the four million dollar limitation.
Further, in order to properly administer the limitation of investment
tax credit at a closed facility, the department may disclose information
about the calculation and the amounts of the credits claimed under this
subdivision for qualified investments at a particular closed facility to
other taxpayers claiming investment tax credits under this subdivision
at that same closed facility.

(i) Economic transformation and facility redevelopment program
training tax credit. (1) A taxpayer which meets the requirements of this
section shall be allowed a credit for qualified training expenditures
paid by the taxpayer with respect to the project for which the
certificate of eligibility is issued. The amount of the credit shall be
fifty percent of the qualified training expenses paid during the taxable
year, subject to a limitation of no more than four thousand dollars per
employee per year for such training expenses. This credit applies only
to qualified training provided to employees who were hired after they
lost their jobs at a closed facility as a result of the closure of that
facility as described in subdivision eleven of section four hundred of
the economic development law.

(2) Qualified training shall include a course or courses taken and
satisfactorily completed by an employee of the taxpayer at an
accredited, degree granting, post-secondary college or university in New
York state that (A) directly relates to the duties that the employee
performs for the taxpayer within the economic transformation area; and
(B) is intended to upgrade, retrain or improve the productivity or
theoretical awareness of the employee. Such course or courses shall not
include classes in the disciplines of management, accounting or the law
or any class designed to fulfill the discipline specific requirements of
a degree program at the associate, baccalaureate, graduate or
professional level of these disciplines. Satisfactory completion of a
course or courses shall mean the earning and granting of credit or
equivalent unit, with the attainment of a grade of "B" or higher in a
graduate level course or courses, a grade of "C" or higher in an
undergraduate level course or courses, or a similar measure of
competency for a course that is not measured according to a standard
grade formula.

(3) Qualified training expenditures shall include expenses for tuition
and mandatory fees, software required by the institution, fees for
textbooks or other literature required by the institution offering the
course or courses, minus applicable scholarships and tuition or fee
waivers not granted by the taxpayer or any related person, that are paid
or reimbursed by the taxpayer. Qualified training expenditures do not
include room and board, computer hardware or software not specifically
assigned for such course or courses, late-charges, fines or membership
dues and similar expenses. Such qualified training expenditures shall
not be eligible for the credit provided by this section unless the
employee for whom the expenditures are disbursed is continuously
employed by the taxpayer in a full-time, full-year position primarily
located at a site in an economic transformation area during the period
of such coursework and lasting through at least one hundred eighty days
after the satisfactory completion of the qualifying course-work.
Qualified training expenditures shall not include expenses for in-house
or shared training outside of a New York state higher education
institution or the use of consultants outside of credit granting
courses, whether such consultants function inside of such higher
education institution or not.

(j) Economic transformation and facility redevelopment program real
property tax credit. (1) A taxpayer which meets the requirements of this
section shall be allowed a credit measured by the real property taxes on
the real property located in the economic transformation area with
respect to the project for which the certificate of eligibility is
issued. In the first taxable year that the taxpayer may claim this
credit, the credit shall be equal to twenty-five percent of the real
property taxes assessed and paid during that year by the participant on
the real property located in the economic transformation area outside of
the closed facility. If the real property is located entirely within the
grounds of a closed facility, the credit in the first year of the
benefit period shall be equal to fifty percent of the real property
taxes assessed and paid by the participant during that year on that
property. In the following years of the benefit period, the percentage
decreases by five percentage points each year for real property located
in the economic transformation area outside of the closed facility, and
ten percentage points for real property located at the closed facility.

(2) (A) For purposes of this credit, "real property taxes" means a
charge imposed upon real property by or on behalf of a county, city,
town, village or school district for municipal or school district
purposes, provided that the charge is levied for the general public
welfare by the proper taxing authorities at a like rate against all
property in the territory over which such authorities have jurisdiction,
and provided that where taxes are levied pursuant to article eighteen or
article nineteen of the real property tax law, the property must have
been taxed at the rate determined for the class in which it is
contained, as provided by such article eighteen or nineteen, whichever
is applicable.

(B) The term "real property taxes" does not include a charge for local
benefits, including any portion of that charge that is properly
allocated to the costs attributable to maintenance or interest, when (i)
the property subject to the charge is limited to the property that
benefits from the charge, or (ii) the amount of the charge is determined
by the benefit to the property assessed, or (iii) the improvement for
which the charge is assessed tends to increase the property value.

(C) The term "real property taxes" includes payments in lieu of taxes
made by the participant which is the beneficial owner of the real
property to the state, a municipal corporation or a public benefit
corporation pursuant to a written agreement entered into between the
participant and the state, municipal corporation, or public benefit
corporation. Provided, however, a payment in lieu of taxes made by the
participant pursuant to a written agreement shall not constitute real
property taxes in any taxable year to the extent that such payment
exceeds the product of (i) the basis for federal income tax purposes of
the real property located in the economic transformation area and
subject to that agreement, calculated without regard to depreciation, on
the last day of the taxable year, and (ii) the estimated effective full
value tax rate within the county in which such property is located, as
most recently calculated by the commissioner. The commissioner shall
annually calculate estimated effective full value tax rates within each
county for this purpose based upon the most current information
available to him or her in relation to county, city, town, village and
school district taxes.

(k) Recapture of credits. If the participant at the end of its benefit
period has not created sufficient net new jobs and made sufficient
qualified investments to achieve a benefit-cost ratio of at least ten to
one, the taxpayer shall be required to add back as tax in the last year
of its benefit period the portion of the economic transformation and
facility redevelopment tax credits claimed in the years of its benefit
period necessary to achieve a cost benefit ratio of ten to one.

* NB Repealed December 31, 2026

* NB There are 2 § 35's