NY State Senate Bill 2009-S6161

Senate Bill S6161

2009-2010 Legislative Session

Authorizes the denial of renewal of professional, business or trade licenses where a taxpayer has outstanding tax debt which the taxpayer has failed to settle

download bill text pdf

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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Actions

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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jun 07, 2010	print number 6161b
Jun 07, 2010	amend (t) and recommit to finance
Jan 06, 2010	referred to finance
Nov 23, 2009	print number 6161a
Nov 23, 2009	amend (t) and recommit to rules
Sep 09, 2009	referred to rules

Bill Amendments

Original

B (Active)

2009-S6161 - Details

Current Committee:: Senate Finance
Law Section:: Executive Law
Laws Affected:: Amd §32, Exec L; amd §401, St Ad Proc Act; amd §53, Judy L; add §1702, Tax L
Versions Introduced in 2011-2012 Legislative Session:: S567

2009-S6161 - Summary

Authorizes the denial of the renewal of a license, permit, certificate, registration or admission to practice a profession, business or trade where a taxpayer has outstanding tax debt which the taxpayer has failed to enter into a settlement agreement for the payment thereof; requires each taxpayer renewing a license to practice a profession, business or trade to attest to the licensing agency that he or she does not have an unsettled outstanding tax debt.

2009-S6161 - Sponsor Memo

                                 BILL NUMBER:  S6161

 TITLE OF BILL :
An act to amend the executive law and the tax law, in relation to
denial of renewal of professional licenses where the individual has
outstanding tax debt and requires the development of the
intergovernmental data match system for tax collection purposes


 PURPOSE :
This bill provides the Department of Tax and Finance with additional
tools to collect tax debt owed to the State of New York.

 SUMMARY OF PROVISIONS :
Section 1 of the bill amends Executive Law section 32, thereby giving
state agencies the authority to deny the renewal of a professional
license if informed by the Department of Tax and Finance that an
individual owes tax debt to New York State.

Section 2 of the bill adds a new section 1702 to Article 36 of the Tax
Law. This section empowers the commissioner of the Department of Tax
and Finance to create a data match system in order to match data from
licensing state agencies to lists of tax debtors, in order to identify
tax debtors with professional licenses in New York State.  This
section also requires licensing agencies to share their information
with the Department of Tax and Finance in order to create such a data

match system.

Section 3 of the bill adds a new section 1703 to Article 36 of the Tax
Law.  This section gives the Department of Tax and Finance the
authority to contact licensing state agencies and inform them that the
renewal of a professional license is being denied because an
individual has outstanding tax debt. The section lays out the
notification procedures the department is to follow to inform
individuals that their license might be denied renewal due to
outstanding tax debt.  The section also lays out the means by which
individuals can challenge a finding that they owe tax debt, or the
denial of renewal of a professional license.

Section 4 of the bill establishes the effective date of the bill as
immediate upon passage, provided that Section 2 of the bill take
effect on the sixtieth day after passage, and provided section 3 of
the bill take effect on the one hundred and twentieth day after the
bill passes.

 EXISTING LAW :
Existing law does not give state agencies the authority to deny the
renewal of licenses based on a licensee owing tax debt to New York
State. Existing law also does not provide for the sharing of licensing
information by state licensing agencies with the Department of Tax and
Finance. Existing law does not allow the Department of Tax and Finance
to inform licensing agencies that the renewal of professional license
is to be denied due to tax debt.

 STATEMENT IN SUPPORT :
The ability to effectively collect taxes is crucial for the
functioning of State government. While the Department of Tax and
Finance has various powers and tools at its disposal to try to collect
tax debt, according to the department there was an outstanding
collectable tax debt of $2.5 billion as of April 30, 2009. Additional
tools for improved collections need to be examined and implemented in
order to collect on this massive debt, which if achieved would help
ease the current fiscal problems of the State.

In several other states, such as Illinois, Massachusetts, Minnesota,
Missouri, Rhode Island, and wisconsin, revenue departments have the
power to suspend or deny the renewal of professional licenses, and
other licenses, if an individual owes a tax debt to the state. These
programs have proven successful, and have been expanded and improved
over the last few years. In Illinois, an improvement in their ability
to match tax debt records with those of licensing agencies brought an
additional $4 million in revenue collected between February 2009 and
the end of June, 2009. Massachusetts granted the power to suspend or
deny the renewal of professional and driver's licenses to their
Department of Revenue starting in 2008, and from September 2008 to
July 2009 this program collected an additional $9 million in revenue.

Licensing agencies in New York State do not check to see if licensees
owe any tax debt to New York prior to the issuance or renewal of
professional licenses. The Department of Tax and Finance does not have
access to information allowing them to find out if a professional
licensee owes tax debt, and lacks the ability to affect a licensee's
status even if they did.  There are over 430,000 individuals that owe
New York State a collectible tax debt. At the same time, the two most
significant professional licensing agencies in New York State, the
Department of Education, through its Office of Professions, and the
Department of State together have a million and a half current
professional licenses issued. Thirteen other State agencies also
license professions. overlap between tax debtors and professional
licensees hare in New York is inevitable, just as it is in all the
other states that have these kinds of programs.

The bill also provides for strict notification standards on the part
of the Department of Tax and Finance, in order to give individuals
that might lose their professional license plenty of time to respond
and pay up, enter into a payment agreement with the state, or
challenge the validity of any supposed tax debt. This is done to
protect members of the public from any sudden denial of a license that
is crucial for their ability to carry out their profession.

 PRIOR LEGISLATIVE HISTORY :
This is a new bill.

 BUDGET IMPLICATIONS :
There will be costs associated with the creation of a data matching
system, as well as the need for increase staffing that the Department
of Tax and Finance, plus ongoing administrative costs of the program.
This bill shall also lead to increased collections of outstanding tax
debt, which would supersede any costs, as these programs have in all
other states that implement them.

 EFFECTIVE DATE :
This bill would take effect immediately, provided that section 2 of
the bill take effect on the sixtieth day after passage, and further
provided that section 3 of the bill take effect on the one hundred and
twentieth day after the bill passes.

2009-S6161 - Bill Text download pdf

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

                                  6161

                       2009-2010 Regular Sessions

                            I N  S E N A T E

                            September 9, 2009
                               ___________

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

AN ACT to amend the executive law and the tax law, in relation to denial
  of renewal of professional licenses where the individual has outstand-
  ing tax debt and requires the  development  of  the  intergovernmental
  data match system for tax collection purposes

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

  Section 1. Subdivision 1 of section 32 of the executive law, as  added
by chapter 55 of the laws of 1992, is amended and a new subdivision 3 is
added to read as follows:
  1. For [the] purposes of this section[,]:
  (A)  "state  agency"  shall  mean any state department, board, bureau,
division, commission, committee, public authority, public benefit corpo-
ration, council, office,  or  other  governmental  entity  performing  a
governmental or proprietary function for the state; AND
  (B)  "DEBT" MEANS ALL LIABILITIES, INCLUDING UNPAID TAX, INTEREST, AND
PENALTY, THAT THE COMMISSIONER OF TAXATION AND FINANCE  IS  REQUIRED  BY
LAW  TO  COLLECT AND THAT HAVE BEEN REDUCED TO JUDGMENT BY THE DOCKETING
OF A NEW YORK STATE TAX WARRANT IN THE OFFICE OF A COUNTY CLERK  LOCATED
IN  THE  STATE  OF NEW YORK OR BY THE FILING OF A COPY OF THE WARRANT IN
THE OFFICE OF THE DEPARTMENT OF STATE.
  3. NOTWITHSTANDING ANY OTHER PROVISION OF LAW, A STATE  AGENCY  SHALL,
FOLLOWING CONSULTATION WITH THE STATE DEPARTMENT OF LAW AND AFTER APPRO-
PRIATE  DUE  PROCESS AS REQUIRED BY APPLICABLE PROVISIONS OF LAW, NOT BE
REQUIRED TO RENEW ANY LICENSE, PERMIT, CERTIFICATE, APPROVAL,  REGISTRA-
TION  OR  AUTHORITY  TO PRACTICE ANY PROFESSION, BUSINESS OR TRADE, UPON
NOTIFICATION BY THE DEPARTMENT OF TAXATION AND FINANCE  THAT  THE  BUSI-
NESS,  INDIVIDUAL,  OR  OTHER  ENTITY  HAS FAILED TO PAY OR ENTER INTO A
WRITTEN AGREEMENT TO SETTLE OUTSTANDING DEBT.

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD14691-02-9

S. 6161                             2

  S 2. The tax law is amended by adding a new section 1702  to  read  as
follows:
  S  1702.  INTERGOVERNMENTAL  DATA  MATCH  SYSTEM  FOR  TAX  COLLECTION
PURPOSES.  1. AS USED IN THIS SECTION:
  (A) "DEBT" MEANS ALL LIABILITIES, INCLUDING UNPAID TAX, INTEREST,  AND
PENALTY,  THAT  THE  COMMISSIONER IS REQUIRED BY LAW TO COLLECT AND THAT
HAVE BEEN REDUCED TO JUDGMENT BY THE DOCKETING OF A NEW YORK  STATE  TAX
WARRANT IN THE OFFICE OF A COUNTY CLERK LOCATED IN THE STATE OF NEW YORK
OR  BY  THE FILING OF A COPY OF THE WARRANT IN THE OFFICE OF THE DEPART-
MENT OF STATE.
  (B) "LICENSE" MEANS THE WHOLE OR PART OF ANY  AGENCY  PERMIT,  CERTIF-
ICATE,  APPROVAL,  REGISTRATION,  CHARTER, OR SIMILAR FORM OF PERMISSION
REQUIRED BY LAW.
  (C) "LICENSING"  MEANS  ANY  AGENCY  ACTIVITY  RESPECTING  THE  GRANT,
DENIAL,  RENEWAL, REVOCATION, SUSPENSION, ANNULMENT, WITHDRAWAL, RECALL,
CANCELLATION OR AMENDMENT OF A LICENSE.
  (D) "STATE AGENCY" MEANS ANY STATE DEPARTMENT,  BOARD,  BUREAU,  DIVI-
SION,  COMMISSION,  COMMITTEE,  PUBLIC  AUTHORITY, PUBLIC BENEFIT CORPO-
RATION, COUNCIL, OFFICE,  OR  OTHER  GOVERNMENTAL  ENTITY  PERFORMING  A
GOVERNMENTAL OR PROPRIETARY FUNCTION FOR THE STATE.
  (E)  "TAX  DEBTOR"  MEANS  A NATURAL PERSON OR ANY ENTITY OTHER THAN A
NATURAL PERSON NAMED ON A NEW YORK  STATE  TAX  WARRANT  AND  IDENTIFIED
THEREON AS A JUDGMENT DEBTOR.
  2.  (A)  TO  ASSIST  THE  COMMISSIONER IN THE COLLECTION OF DEBTS, THE
DEPARTMENT SHALL DEVELOP AND OPERATE  AN  INTERGOVERNMENTAL  DATA  MATCH
SYSTEM  FOR  THE PURPOSE OF IDENTIFYING TAX DEBTORS THAT ARE APPLYING TO
RENEW  ANY  LICENSE,  PERMIT,  CERTIFICATE,  APPROVAL,  REGISTRATION  OR
AUTHORITY TO PRACTICE ANY PROFESSION, BUSINESS OR TRADE.
  (B) NOTWITHSTANDING ANY OTHER PROVISION OF LAW, EACH STATE AGENCY THAT
LICENSES  INDIVIDUALS IN THE CONDUCT OF A PROFESSION, BUSINESS, OR TRADE
SHALL PROVIDE SUCH INFORMATION TO THE DEPARTMENT  FOR  THE  PURPOSES  OF
DEVELOPING THE INTERGOVERNMENTAL DATA MATCH SYSTEM TO ASSIST THE COMMIS-
SIONER IN THE COLLECTION OF DEBTS.
  (C)  THE  COMMISSIONER  IS  AUTHORIZED  TO  DESIGNATE A THIRD PARTY TO
DEVELOP AND OPERATE THE INTERGOVERNMENTAL DATA MATCH SYSTEM.  ANY  THIRD
PARTY DESIGNATED BY THE COMMISSIONER TO DEVELOP AND OPERATE AN INTERGOV-
ERNMENTAL DATA MATCH SYSTEM SHALL KEEP ALL INFORMATION IT OBTAINS CONFI-
DENTIAL,  AND  ANY EMPLOYEE, AGENT OR REPRESENTATIVE OF THAT THIRD PARTY
IS PROHIBITED FROM DISCLOSING THAT INFORMATION TO ANYONE OTHER THAN  THE
DEPARTMENT.
  3.  EACH STATE AGENCY SHALL PROVIDE UPDATED INFORMATION TO THE DEPART-
MENT WITHIN ONE HUNDRED TWENTY DAYS PRIOR TO THE  RENEWAL  OR  RECERTIF-
ICATION  DATE  OF A LICENSE, PERMIT, CERTIFICATE, APPROVAL, REGISTRATION
OR AUTHORITY TO PRACTICE ANY PROFESSION,  BUSINESS  OR  TRADE,  OR  EACH
CALENDAR  QUARTER  IF RENEWAL OR RECERTIFICATION IS NOT REQUIRED FOR THE
LICENSE, PERMIT, CERTIFICATE, APPROVAL,  REGISTRATION  OR  AUTHORITY  TO
PRACTICE ANY PROFESSION, BUSINESS OR TRADE.
  S  3.  The  tax law is amended by adding a new section 1703 to read as
follows:
  S 1703. DENIAL OF RENEWAL FOR PROFESSIONAL LICENSES.  1.  AS  USED  IN
THIS SECTION:
  (A)  "DEBT" MEANS ALL LIABILITIES, INCLUDING UNPAID TAX, INTEREST, AND
PENALTY, THAT THE COMMISSIONER IS REQUIRED BY LAW TO  COLLECT  AND  THAT
HAVE  BEEN  REDUCED TO JUDGMENT BY THE DOCKETING OF A NEW YORK STATE TAX
WARRANT IN THE OFFICE OF A COUNTY CLERK LOCATED IN THE STATE OF NEW YORK

S. 6161                             3

OR BY THE FILING OF A COPY OF THE WARRANT IN THE OFFICE OF  THE  DEPART-
MENT OF STATE.
  (B)  "LICENSE"  MEANS  THE WHOLE OR PART OF ANY AGENCY PERMIT, CERTIF-
ICATE, APPROVAL, REGISTRATION, CHARTER, OR SIMILAR  FORM  OF  PERMISSION
REQUIRED BY LAW.
  (C)  "LICENSING"  MEANS  ANY  AGENCY  ACTIVITY  RESPECTING  THE GRANT,
DENIAL, RENEWAL, REVOCATION, SUSPENSION, ANNULMENT, WITHDRAWAL,  RECALL,
CANCELLATION OR AMENDMENT OF A LICENSE.
  (D)  "STATE  AGENCY"  SHALL  MEAN ANY STATE DEPARTMENT, BOARD, BUREAU,
DIVISION, COMMISSION, COMMITTEE, PUBLIC AUTHORITY, PUBLIC BENEFIT CORPO-
RATION, COUNCIL, OFFICE,  OR  OTHER  GOVERNMENTAL  ENTITY  PERFORMING  A
GOVERNMENTAL OR PROPRIETARY FUNCTION FOR THE STATE.
  (E)  "TAX  DEBTOR"  MEANS  A NATURAL PERSON OR ANY ENTITY OTHER THAN A
NATURAL PERSON NAMED ON A NEW YORK  STATE  TAX  WARRANT  AND  IDENTIFIED
THEREON AS A JUDGMENT DEBTOR.
  2.  WHEN  THE DEPARTMENT MATCHES THE NAME OF AN INDIVIDUAL LICENSED OR
CERTIFIED BY A STATE AGENCY TO CONDUCT A PROFESSION, BUSINESS, OR TRADE,
WITH THE NAME OF A TAX DEBTOR WHO HAS NOT ENTERED INTO A WRITTEN  AGREE-
MENT  WITH  THE  DEPARTMENT TO PAY OFF HIS OR HER DEBT, OR IS NOT IN THE
PROCESS OF APPEALING THE JUDGMENT OR DEBT,  THE  DEPARTMENT  SHALL  SEND
NOTICE  WRITTEN  IN  PLAIN  LANGUAGE  TO THE INDIVIDUAL WHO HOLDS SUCH A
LICENSE, TO THE ADDRESS NOTED IN THE  LICENSING  INFORMATION,  NOTIFYING
THE  TAX  DEBTOR  THAT  THEY CURRENTLY HAVE AN OUTSTANDING DEBT AND THAT
FAILURE TO PAY HIS OR HER DEBT WILL LEAD  TO  A  DENIAL  OF  RENEWAL  OR
RECERTIFICATION OF THAT LICENSE.
  3.  (A)  NOTICE  PROVIDED  PURSUANT TO SUBDIVISION TWO OF THIS SECTION
SHALL STATE THAT THE INDIVIDUAL HAS SIXTY DAYS TO RESPOND IN WRITING  TO
THE DEPARTMENT IN ORDER TO SET UP THE CONDITIONS BY WHICH THEY WOULD PAY
OFF THEIR DEBT IN FULL, OR SET UP A PAYMENT PLAN TO FULFILL THEIR DEBT.
  (B)  NOTICE  PROVIDED BY THE DEPARTMENT PURSUANT TO SUBDIVISION TWO OF
THIS SECTION SHALL COMPLY WITH THE REQUIREMENTS ESTABLISHED UNDER  ARTI-
CLE FORTY-ONE OF THIS CHAPTER.
  (C)  THE  DEPARTMENT SHALL PROVIDE NOTIFICATION TO THE LICENSING STATE
AGENCY INFORMING THEM THAT THE HOLDER OF A LICENSE IS A TAX DEBTOR,  AND
THAT  THE  DEPARTMENT  HAS INFORMED THE INDIVIDUAL THAT IT WILL DENY THE
RENEWAL OF THIS LICENSE OR PERMIT UNTIL THE TAX DEBTOR PAYS  THEIR  DEBT
OR ENTERS INTO A PAYMENT AGREEMENT.
  4. (A) IF AN INDIVIDUAL FAILS TO RESPOND TO THE DEPARTMENT OR DOES NOT
REQUEST  A  HEARING  TO  APPEAL THE TAX DEBT WITHIN SIXTY DAYS, A SECOND
NOTICE SHALL BE SENT TO THE TAX DEBTOR INFORMING HIM OR HER THAT  UNLESS
THEY  CONTACT  THE  DEPARTMENT IN WRITING WITHIN FOURTEEN DAYS, THEN THE
DEPARTMENT WILL DENY RENEWAL OF THEIR LICENSE.
  (B) IF AN INDIVIDUAL FAILS TO ANSWER THE SECOND NOTICE, THE DEPARTMENT
SHALL NOTIFY THE LICENSING STATE AGENCY THAT RENEWAL OF THEIR LICENSE IS
DENIED. THE DEPARTMENT SHALL ALSO SEND NOTICE TO  THE  TAX  DEBTOR  THAT
RENEWAL OF THEIR LICENSE HAS BEEN DENIED.
  5.  IF AN INDIVIDUAL HAS REQUESTED A HEARING TO DISPUTE THEIR TAX DEBT
AND THE STATE AGENCY HAS BEEN NOTIFIED THAT SUCH A HEARING  IS  PENDING,
THE  AGENCY  MAY  PROVISIONALLY RENEW THE INDIVIDUAL'S LICENSE, WITH THE
UNDERSTANDING THAT IF THE INDIVIDUAL LOSES HIS OR HER APPEAL  AND  FAILS
TO  THEN  PAY  HIS  OR  HER  DEBT OR ENTER INTO A PAYMENT PLAN, THAT THE
RENEWAL IS TO BE DENIED.
  6. (A) AN INDIVIDUAL WHO HAS HAD RENEWAL OF THEIR  LICENSE  DENIED  BY
THE  DEPARTMENT  UNDER  THIS  SECTION  MAY  APPEAL  SUCH DECISION TO THE
DEPARTMENT.

S. 6161                             4

  (B) IF THE INDIVIDUAL'S APPEAL IS GRANTED, THE DEPARTMENT SHALL  IMME-
DIATELY  INFORM  THE  LICENSING  STATE  AGENCY THAT THE DEPARTMENT IS NO
LONGER DENYING THE INDIVIDUAL THE RENEWAL OF THAT LICENSE.
  (C)  IF  AN INDIVIDUAL PAYS THEIR DEBT OR ENTERS INTO A PAYMENT AGREE-
MENT WITH THE DEPARTMENT TO FULFILL THEIR OBLIGATION AFTER  THE  DEPART-
MENT  DENIED  RENEWAL  OF  THEIR LICENSE, THEN THE DEPARTMENT SHALL SEND
NOTICE TO THE LICENSING STATE AGENCY INFORMING THEM THAT THE  DEPARTMENT
NO LONGER DENIES THE RENEWAL OF THE INDIVIDUAL'S LICENSE.
  S  4.  This  act shall take effect immediately; provided, however that
section two of this act shall take effect on the sixtieth day  after  it
shall  have become a law and provided further that section three of this
act shall take effect on the one hundred twentieth day  after  it  shall
have become a law.

2009-S6161A - Details

Current Committee:: Senate Finance
Law Section:: Executive Law
Laws Affected:: Amd §32, Exec L; amd §401, St Ad Proc Act; amd §53, Judy L; add §1702, Tax L
Versions Introduced in 2011-2012 Legislative Session:: S567

2009-S6161A - Summary

2009-S6161A - Sponsor Memo

                                 BILL NUMBER:  S6161A

 TITLE OF BILL :
An act to amend the executive law, the state administrative procedure
act, the judiciary law and the tax law, in relation to the denial of
the renewal of professional licenses when the applicant has
outstanding avoidance of state tax debt


 PURPOSE :
This bill provided the State of New York with additional tools to
collect outstanding tax debt.

 SUMMARY OF PROVISIONS :
Section 1 amends §32 of the Executive law by adding a section three,
which mandates that state agencies deny the renewal of professional
licenses to individuals unable to provide proof that they do not owe
tax debt.

Section 2 amends §401 of the State Administrative Procedure Act to
state that having a certification from the Department of Tax and
Finance that an individual does not owe tax debt is to be a
prerequisite for the renewal of professional licenses.

Section 3 amends §53 of the Judiciary Law to state that having a
certification from the Department of Tax and Finance that an

individual does not owe tax debt is to be a prerequisite for the
recertification of an attorney or counselor at law.

Section 4 adds a new §1702 to the Tax Law, which authorizes the
Department of Tax and Finance to create an computerized system that
will be used to issue certificates to individuals proving that they do
not owe a tax debt to New York State either through a secure website
or through a mailed in request. This section lays out an individuals'
rights to appeal a determination that they owe tax debt on the basis
that they were wrongfully identified as having tax debt, that they
paid off said tax debt, or that they have entered into an agreement
with the Department of Tax and Finance to payoff the tax debt.

Section 5 lays out an effective date of June 1, 2011, provided that
any rules, regulations, or actions necessary to act on its effective
date are authorized and directed to be completed on or before that
date.

 EXISTING LAW :
Existing law does not give state agencies the authority to deny the
renewal of licenses based on a licensee owing tax debt to New York
State. Existing law does not provide for any system which allows the
Department of Tax and Finance to issue individuals certification that
they do not owe tax debt.

 STATEMENT IN SUPPORT :
The ability to effectively collect taxes is crucial for the
functioning of State government. While the Department of Tax and
Finance has various powers and tools at its disposal to try to collect
tax debt, according to the department there was an outstanding
collectable tax debt of $2.5 billion as of April 30, 2009. Additional
tools for improved collections need to be examined and implemented in
order to collect on this massive debt, which if achieved would help
ease the current fiscal problems of the State.

In several other states, such as Illinois, Massachusetts, Minnesota,
Missouri, Rhode Island, and Wisconsin, revenue departments have the
power to suspend or deny the renewal of professional licenses, and
other licenses, if an individual owes a tax debt to the state. These
programs have proven successful, and have been expanded and improved
over the last few years. In Illinois, an improvement in their ability
to match tax debt records with those of licensing agencies brought an
additional $4 million in revenue collected between February 2009 and
the end of June, 2009. Massachusetts granted the power to suspend or
deny the renewal of professional and driver's licenses to their
Department of Revenue starting in 2008, and from September 2008 to
July 2009 this program collected an additional $9 million in revenue.

Licensing agencies in New York State do not check to see if licensees
owe any tax debt to New York prior to the issuance or renewal of
professional licenses. The Department of Tax and Finance does not have
access to information allowing them to find out if a professional
licensee owes tax debt, and lacks the ability to affect a licensee's
status even if they did.  There are over 430,000 individuals that owe
New York State a collectible tax debt. At the same time, the two most
significant professional licensing agencies in New York State, the
Department of Education, through its Office of Professions, and the
Department of State together have a million and a half current
professional licenses issued. Thirteen other State agencies also
license professions. Overlap between tax debtors and professional
licensees hare in New York is inevitable, just as it is in all the
other states that have these kinds of programs.

The bill also provides for strict notification standards on the part
of the Department of Tax and Finance, in order to give individuals
that might lose their professional license plenty of time to respond
and pay up, enter into a payment agreement with the state, or
challenge the validity of any supposed tax debt. This is done to
protect members of the public from any sudden denial of a license that
is crucial for their ability to carry out their profession.

 PRIOR LEGISLATIVE HISTORY :
This is a new bill.

 BUDGET IMPLICATIONS :
There will be costs associated with the creation of a data matching
system, as well as the need for increase staffing that the Department
of Tax and Finance, plus ongoing administrative costs of the program.
This bill shall also lead to increased collections of outstanding tax
debt, which would supersede any costs, as these programs have in all
other states that implement them.

 EFFECTIVE DATE :
The effective date of this act is June 1, 2011, provided that any
rules, regulations, or actions necessary to implement the provisions
of this act on its effective date are authorized and directed to be
completed on or before that date.

2009-S6161A - Bill Text download pdf

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

                                 6161--A

                       2009-2010 Regular Sessions

                            I N  S E N A T E

                            September 9, 2009
                               ___________

Introduced  by  Sen.  KLEIN  -- read twice and ordered printed, and when
  printed to be  committed  to  the  Committee  on  Rules  --  committee
  discharged, bill amended, ordered reprinted as amended and recommitted
  to said committee

AN  ACT  to  amend the executive law, the state administrative procedure
  act, the judiciary law and the tax law, in relation to the  denial  of
  the  renewal of professional licenses when the applicant has outstand-
  ing avoidance of state tax debt

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

  Section  1. Section 32 of the executive law, as added by chapter 55 of
the laws of 1992, is amended to read as follows:
  S 32. Authority not to renew. 1. For the purposes  of  this  section[,
"state]:  (A)  "STATE  agency"  shall  mean any state department, board,
bureau, division, commission, committee, public authority, public  bene-
fit  corporation, council, office, or other governmental entity perform-
ing a governmental or proprietary function  for  the  state,  AND  SHALL
INCLUDE THE EDUCATION DEPARTMENT.
  (B)  "TAX  DEBT"  SHALL  MEAN ALL LIABILITIES, INCLUDING UNPAID TAXES,
INTEREST AND PENALTIES, THAT THE COMMISSIONER OF TAXATION AND FINANCE IS
REQUIRED BY LAW TO COLLECT, AND THAT HAVE BEEN REDUCED  TO  JUDGMENT  BY
THE  DOCKETING OF A NEW YORK STATE TAX WARRANT WITH A COUNTY CLERK OR BY
THE FILING OF A COPY THEREOF WITH  THE  DEPARTMENT  OF  STATE,  AND  THE
TAXPAYER  DEBTOR  HAS  FAILED TO PAY SUCH LIABILITIES OR FAILED TO ENTER
INTO A WRITTEN AGREEMENT WITH THE DEPARTMENT OF TAXATION AND FINANCE  TO
SETTLE SUCH LIABILITIES.
  2.  Notwithstanding  any  other  provision of law, when a state agency
levies fees or assesses civil fines or penalties for licensing or  regu-
latory matters, such state agency shall, following consultation with the
[state]  department  of  law  and  after such appropriate due process as
required by the provisions of law applicable to such state agency and to

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD14691-06-9

S. 6161--A                          2

such licensing or regulatory matters,  not  be  required  to  renew  any
license, permit, or certificate of qualification, authority[,] or opera-
tion,  of  any  business,  individual[,] or other entity, which is not a
state  agency,  municipal  corporation  or district corporation, if such
business, individual or other entity has failed to pay or enter  into  a
written  agreement  to settle outstanding fees, civil penalties or fines
assessed by such state agency.
  3. (A) NOTWITHSTANDING ANY OTHER PROVISION OF LAW, EVERY STATE  AGENCY
WHICH  ISSUES  LICENSES,  PERMITS,  CERTIFICATES  OR REGISTRATIONS WHICH
SPECIFICALLY AUTHORIZE ANY PERSONS OR ENTITIES TO  CONDUCT  ANY  PROFES-
SION,  BUSINESS  OR  TRADE SHALL DENY THE APPLICATION FOR THE RENEWAL OF
ANY SUCH LICENSE, PERMIT, CERTIFICATE OR REGISTRATION TO ANY  PERSON  OR
ENTITY WHICH FAILS TO PROVIDE THE STATE AGENCY WITH A CERTIFICATE OF TAX
COMPLIANCE  ISSUED BY THE DEPARTMENT OF TAXATION AND FINANCE PURSUANT TO
SECTION SEVENTEEN HUNDRED TWO OF THE TAX LAW, WHICH  ATTESTS  THAT  SUCH
PERSON OR ENTITY DOES NOT HAVE A TAX DEBT.
  (B)  IT  SHALL  BE A CONDITION FOR THE RENEWAL OF ANY LICENSE, PERMIT,
CERTIFICATE OR REGISTRATION WHICH SPECIFICALLY AUTHORIZES ANY PERSON  OR
ENTITY  TO  CONDUCT ANY PROFESSION, BUSINESS OR TRADE THAT THE APPLICANT
FOR ISSUANCE OR RENEWAL PROVIDE THE STATE AGENCY ISSUING OR RENEWING THE
LICENSE, PERMIT, CERTIFICATE OR REGISTRATION WITH A CERTIFICATE  OF  TAX
COMPLIANCE  ISSUED BY THE DEPARTMENT OF TAXATION AND FINANCE PURSUANT TO
SECTION SEVENTEEN HUNDRED TWO OF THE TAX LAW,  WHICH  ATTESTS  THAT  THE
APPLICANT  DOES  NOT HAVE A TAX DEBT, AND DATED WITHIN SIXTY DAYS OF THE
APPLICATION FOR AN INITIAL OR THE EXPIRATION  OF  AN  EXISTING  LICENSE,
PERMIT, CERTIFICATE OR REGISTRATION TO CONDUCT A PROFESSION, BUSINESS OR
TRADE.
  (C)  EVERY  APPLICATION  FOR THE RENEWAL OF A LICENSE, PERMIT, CERTIF-
ICATE OR REGISTRATION WHICH SPECIFICALLY AUTHORIZES ANY PERSON OR ENTITY
TO CONDUCT A PROFESSION, BUSINESS OR TRADE SHALL PROVIDE NOTICE  TO  THE
APPLICANT  OF  THE  REQUIREMENTS  OF THIS SUBDIVISION. IN ADDITION, SUCH
NOTICE SHALL PROVIDE THE APPLICANT WITH THE INTERNET WEBSITE AND MAILING
ADDRESS FOR THE DEPARTMENT OF TAXATION AND FINANCE  FROM  WHICH  CERTIF-
ICATES  OF  TAX  COMPLIANCE WILL BE ISSUED PURSUANT TO SECTION SEVENTEEN
HUNDRED TWO OF THE TAX LAW.
  S 2. Section 401 of the state administrative procedure act, as amended
by chapter 935 of the laws of 1976, subdivision 1 as amended by  chapter
469  of  the  laws of 1985, subdivision 4 as added by chapter 236 of the
laws of 1987, is amended to read as follows:
  S 401. Licenses. 1. FOR THE PURPOSES OF THIS ARTICLE:
  (A) "AGENCY" SHALL MEAN AND INCLUDE THE  STATE  JUDICIAL  BRANCH,  THE
UNIFIED COURT SYSTEM, THE OFFICE OF COURT ADMINISTRATION AND THE MEANING
ASCRIBED  TO  SUCH TERM BY SUBDIVISION ONE OF SECTION ONE HUNDRED TWO OF
THIS ACT.
  (B) "TAX DEBT" SHALL MEAN ALL  LIABILITIES,  INCLUDING  UNPAID  TAXES,
INTEREST AND PENALTIES, THAT THE COMMISSIONER OF TAXATION AND FINANCE IS
REQUIRED  BY  LAW TO COLLECT, AND THAT HAVE BEEN REDUCED TO JUDGEMENT BY
THE DOCKETING OF A NEW YORK STATE TAX WARRANT WITH A COUNTY CLERK OR  BY
THE  FILING  OF  A  COPY  THEREOF  WITH THE DEPARTMENT OF STATE, AND THE
TAXPAYER DEBTOR HAS FAILED TO PAY SUCH LIABILITIES OR  FAILED  TO  ENTER
INTO  A WRITTEN AGREEMENT WITH THE DEPARTMENT OF TAXATION AND FINANCE TO
SETTLE SUCH LIABILITIES.
  2. When licensing is required by law to  be  preceded  by  notice  and
opportunity for hearing, the provisions of this chapter concerning adju-
dicatory proceedings apply. For purposes of this act, statutes providing

S. 6161--A                          3

an opportunity for hearing shall be deemed to include statutes providing
an opportunity to be heard.
  [2.]  3.(A)  NOTWITHSTANDING  ANY OTHER PROVISION OF LAW, EVERY AGENCY
WHICH ISSUES LICENSES,  PERMITS,  CERTIFICATES  OR  REGISTRATIONS  WHICH
SPECIFICALLY  AUTHORIZE  ANY  PERSONS OR ENTITIES TO CONDUCT ANY PROFES-
SION, BUSINESS OR TRADE SHALL DENY THE APPLICATION FOR  THE  RENEWAL  OF
ANY  SUCH  LICENSE, PERMIT, CERTIFICATE OR REGISTRATION TO ANY PERSON OR
ENTITY WHICH FAILS TO PROVIDE THE  AGENCY  WITH  A  CERTIFICATE  OF  TAX
COMPLIANCE  ISSUED BY THE DEPARTMENT OF TAXATION AND FINANCE PURSUANT TO
SECTION SEVENTEEN HUNDRED TWO OF THE TAX LAW, WHICH  ATTESTS  THAT  SUCH
PERSON OR ENTITY DOES NOT HAVE A TAX DEBT.
  (B)  IT  SHALL  BE A CONDITION FOR THE RENEWAL OF ANY LICENCE, PERMIT,
CERTIFICATE OR REGISTRATION WHICH SPECIFICALLY AUTHORIZES ANY PERSON  OR
ENTITY  TO  CONDUCT ANY PROFESSION, BUSINESS OR TRADE THAT THE APPLICANT
FOR RENEWAL PROVIDE THE AGENCY ISSUING OR RENEWING THE LICENSE,  PERMIT,
CERTIFICATE  OR REGISTRATION WITH A CERTIFICATE OF TAX COMPLIANCE ISSUED
BY THE DEPARTMENT OF TAXATION AND FINANCE PURSUANT TO SECTION  SEVENTEEN
HUNDRED  TWO  OF  THE TAX LAW, WHICH ATTESTS THAT THE APPLICANT DOES NOT
HAVE A TAX DEBT, AND DATED WITHIN SIXTY DAYS OF  THE  EXPIRATION  OF  AN
EXISTING  LICENSE,  PERMIT,  CERTIFICATE  OR  REGISTRATION  TO CONDUCT A
PROFESSION, BUSINESS OR TRADE.
  (C) EVERY APPLICATION FOR THE RENEWAL OF A  LICENSE,  PERMIT,  CERTIF-
ICATE OR REGISTRATION WHICH SPECIFICALLY AUTHORIZES ANY PERSON OR ENTITY
TO  CONDUCT  A PROFESSION, BUSINESS OR TRADE SHALL PROVIDE NOTICE TO THE
APPLICANT OF THE REQUIREMENTS OF THIS  SUBDIVISION.  IN  ADDITION,  SUCH
NOTICE SHALL PROVIDE THE APPLICANT WITH THE INTERNET WEBSITE AND MAILING
ADDRESS  FOR  THE  DEPARTMENT OF TAXATION AND FINANCE FROM WHICH CERTIF-
ICATES OF TAX COMPLIANCE WILL BE ISSUED PURSUANT  TO  SECTION  SEVENTEEN
HUNDRED TWO OF THE TAX LAW.
  4.  When a licensee has made timely and sufficient application for the
renewal of a license or a new license with reference to any activity  of
a  continuing  nature,  the  existing  license does not expire until the
application has been finally determined by the agency, and, in case  the
application is denied or the terms of the new license limited, until the
last day for seeking review of the agency order or a later date fixed by
order  of  the reviewing court, provided that this subdivision shall not
affect any valid agency action then in effect summarily suspending  such
license.
  [3.]  5.  If  the  agency finds that public health, safety, or welfare
imperatively requires emergency action, and incorporates  a  finding  to
that  effect  in  its  order,  summary  suspension  of  a license may be
ordered, effective on the date specified in such order or  upon  service
of  a  certified  copy of such order on the licensee, whichever shall be
later,  pending  proceedings  for  revocation  or  other  action.  These
proceedings shall be promptly instituted and determined.
  [4.]  6.  When the hearing seeks the revocation of a license or permit
previously granted by the agency, either party shall, upon demand and at
least seven days prior to the hearing, disclose the  evidence  that  the
party  intends  to  introduce  at  the  hearing,  including  documentary
evidence  and  identification  of  witnesses,  provided,  however,   the
provisions  of  this  subdivision  shall  not  be  deemed to require the
disclosure of information or material otherwise protected  by  law  from
disclosure,  including  information  and  material  protected because of
privilege or confidentiality. If, after such disclosure, a party  deter-
mines  to  rely upon other witnesses or information, the party shall, as

S. 6161--A                          4

soon as practicable, supplement its disclosure by providing the names of
such witnesses or the additional documents.
  S 3. Section 53 of the judiciary law is amended by adding a new subdi-
vision 7 to read as follows:
  7. (A) FOR THE PURPOSES OF THIS SUBDIVISION, "TAX DEBT" SHALL MEAN ALL
LIABILITIES,  INCLUDING  UNPAID  TAXES, INTEREST AND PENALTIES, THAT THE
COMMISSIONER OF TAXATION AND FINANCE IS REQUIRED BY LAW TO COLLECT,  AND
THAT  HAVE BEEN REDUCED TO JUDGMENT BY THE DOCKETING OF A NEW YORK STATE
TAX WARRANT WITH A CLERK OR BY THE FILING OF A  COPY  THEREOF  WITH  THE
DEPARTMENT  OF  STATE,  AND  THE  TAXPAYER DEBTOR HAS FAILED TO PAY SUCH
LIABILITIES OR FAILED TO ENTER INTO A WRITTEN AGREEMENT WITH THE DEPART-
MENT OF TAXATION AND FINANCE TO SETTLE SUCH LIABILITIES.
  (B)(I) EVERY APPELLATE DIVISION SHALL DENY THE APPLICATION FOR RENEWAL
OF ADMISSION TO PRACTICE AS AN ATTORNEY AND COUNSELLOR  AT  LAW  OF  ANY
PERSON  WHO  FAILS TO PROVIDE SUCH APPELLATE DIVISION WITH A CERTIFICATE
OF TAX COMPLIANCE ISSUED BY  THE  DEPARTMENT  OF  TAXATION  AND  FINANCE
PURSUANT  TO SECTION SEVENTEEN HUNDRED TWO OF THE TAX LAW, WHICH ATTESTS
THAT SUCH PERSON DOES NOT HAVE A TAX DEBT.
  (II) THE COURT OF APPEALS SHALL ADOPT RULES ESTABLISHING THAT IT SHALL
BE A CONDITION FOR THE RENEWAL OF ADMISSION TO PRACTICE AS  AN  ATTORNEY
AND  COUNSELLOR AT LAW THAT THE APPLICANT PROVIDE THE APPELLATE DIVISION
WITH A CERTIFICATE OF TAX COMPLIANCE ISSUED BY THE DEPARTMENT  OF  TAXA-
TION  AND  FINANCE  PURSUANT TO SECTION SEVENTEEN HUNDRED TWO OF THE TAX
LAW, WHICH ATTESTS THAT THE APPLICANT DOES NOT  HAVE  A  TAX  DEBT,  AND
DATED WITHIN SIXTY DAYS OF THE EXPIRATION OF AN EXISTING ADMISSION.
  (III)  EVERY  APPLICATION  FOR  RENEWAL OF ADMISSION TO PRACTICE AS AN
ATTORNEY AND COUNSELLOR AT LAW SHALL PROVIDE NOTICE TO THE APPLICANT  OF
THE  REQUIREMENTS  OF  THIS  PARAGRAPH.  IN  ADDITION, SUCH NOTICE SHALL
PROVIDE THE APPLICANT WITH THE INTERNET WEBSITE AND MAILING ADDRESS  FOR
THE  DEPARTMENT  OF  TAXATION AND FINANCE FROM WHICH CERTIFICATES OF TAX
COMPLIANCE WILL BE ISSUED PURSUANT TO SECTION SEVENTEEN HUNDRED  TWO  OF
THE TAX LAW.
  S  4.  The  tax law is amended by adding a new section 1702 to read as
follows:
  S 1702. CERTIFICATE OF TAX COMPLIANCE. 1. AS USED IN THIS SECTION:
  (A) "TAX DEBT" SHALL MEAN ALL  LIABILITIES,  INCLUDING  UNPAID  TAXES,
INTEREST  AND  PENALTIES,  THAT  THE  COMMISSIONER IS REQUIRED BY LAW TO
COLLECT, AND THAT HAVE BEEN REDUCED TO JUDGEMENT BY THE DOCKETING  OF  A
NEW  YORK  STATE  TAX  WARRANT WITH A COUNTY CLERK OR BY THE FILING OF A
COPY THEREOF WITH THE DEPARTMENT OF STATE, THE TAX DEBTOR HAS FAILED  TO
PAY  SUCH  LIABILITIES  OR FAILED TO ENTER INTO A WRITTEN AGREEMENT WITH
THE DEPARTMENT OF TAXATION AND FINANCE TO SETTLE SUCH LIABILITIES.
  (B) "TAX DEBTOR" MEANS A NATURAL PERSON OR ENTITY WITH A TAX DEBT.
  2. THE DEPARTMENT SHALL ESTABLISH, IMPLEMENT, OPERATE AND UPDATE IN  A
TIMELY  MANNER  A  COMPUTER DATA SYSTEM WHICH INCLUDES THE NAME, ADDRESS
AND TAX DEBT OF ALL TAX DEBTORS FILED AND IDENTIFIED  ON  THE  BASIS  OF
EACH  SUCH  DEBTOR'S  FEDERAL  EMPLOYER IDENTIFICATION NUMBER OR FEDERAL
SOCIAL SECURITY NUMBER. SUCH COMPUTER DATA SYSTEM SHALL BE ACCESSIBLE TO
ANY TAXPAYER WHO PROVIDES HIS, HER OR ITS FEDERAL  EMPLOYER  IDENTIFICA-
TION  NUMBER  OR  FEDERAL SOCIAL SECURITY NUMBER. ACCESS TO THE COMPUTER
DATA SYSTEM FOR THE  TAX  COMPLIANCE  STATUS  OF  A  TAXPAYER  SHALL  BE
PROVIDED BY MEANS OF AN INTERNET WEBSITE ESTABLISHED FOR SUCH PURPOSE BY
THE DEPARTMENT OR BY SUBMITTING A WRITTEN INQUIRY BY FIRST CLASS MAIL TO
THE DEPARTMENT.
  3. UPON RECEIPT OF ANY TAX COMPLIANCE INQUIRY, WHETHER BY THE INTERNET
OR  BY  MAIL,  THE DEPARTMENT SHALL PROVIDE THE TAXPAYER WITH A DETERMI-

S. 6161--A                          5

NATION OF WHETHER HE, SHE OR IT IS A TAX DEBTOR. IN THE EVENT  THAT  THE
TAXPAYER  IS  NOT A TAX DEBTOR, THE DEPARTMENT SHALL PROVIDE, BY MAIL OR
INTERNET, A CERTIFICATE OF TAX COMPLIANCE. EACH SUCH  CERTIFICATE  SHALL
INCLUDE THE NAME, ADDRESS, AND FEDERAL EMPLOYER IDENTIFICATION NUMBER OR
SOCIAL  SECURITY  NUMBER OF THE TAXPAYER, HAVE THE DATE OF ITS ISSUANCE,
AND INCLUDE A SPECIFIC CASE NUMBER  FOR  EACH  INQUIRY  SUBMITTED  BY  A
TAXPAYER.  EVERY TAX COMPLIANCE INQUIRY SUBMITTED BY MAIL SHALL BE PROC-
ESSED AND A DETERMINATION THEREON RETURNED TO THE TAXPAYER WITHIN  SEVEN
DAYS OF THE RECEIPT OF THE INQUIRY BY THE DEPARTMENT.  IN THE EVENT THAT
THE  COMPUTER  DATA  SYSTEM  IS AT ANY TIME UNABLE TO PROVIDE A DETERMI-
NATION TO A TAX COMPLIANCE INQUIRY FOR A PERIOD OF MORE THAN  TWO  DAYS,
THE  DEPARTMENT  SHALL ISSUE THE TAXPAYER A TEMPORARY CERTIFICATE OF TAX
COMPLIANCE WHICH SHALL AUTHORIZE THE DURATION OF ANY  EXISTING  LICENSE,
PERMIT,  CERTIFICATE,  REGISTRATION  OR ADMISSION TO CONDUCT ANY PROFES-
SION, TRADE OR BUSINESS FOR AN ADDITIONAL THIRTY DAYS.
  4. IN THE EVENT A TAXPAYER IS DETERMINED TO  BE  A  TAX  DEBTOR,  SUCH
TAXPAYER MAY SUBMIT AN APPLICATION TO THE COMMISSIONER ON THE BASIS THAT
HIS,  HER  OR  ITS TAX LIABILITIES HAVE BEEN PAID, THAT THE TAXPAYER HAS
ENTERED INTO AND COMPLIED WITH A WRITTEN AGREEMENT WITH  THE  DEPARTMENT
TO SETTLE HIS, HER OR ITS TAX LIABILITIES, OR THE TAXPAYER WAS WRONGFUL-
LY  IDENTIFIED  IN  THE INQUIRY. EVERY SUCH APPLICATION SHALL BE ADJUDI-
CATED BY THE COMMISSIONER WITHIN TEN DAYS OF THE RECEIPT THEREOF.
  S 5. This act shall take effect June 1, 2011, provided, however,  that
effective immediately, any and all rules, regulations and actions neces-
sary  to  implement the provisions of this act on its effective date are
authorized and directed to be completed on or before such date.

2009-S6161B (ACTIVE) - Details

Current Committee:: Senate Finance
Law Section:: Executive Law
Laws Affected:: Amd §32, Exec L; amd §401, St Ad Proc Act; amd §53, Judy L; add §1702, Tax L
Versions Introduced in 2011-2012 Legislative Session:: S567

2009-S6161B (ACTIVE) - Summary

2009-S6161B (ACTIVE) - Sponsor Memo

                                BILL NUMBER:S6161B

TITLE OF BILL:
An act to amend the executive law, the state administrative procedure
act and the judiciary law, in relation to the denial of the renewal of
professional licenses when the applicant has outstanding avoidance of
state tax debt

PURPOSE:
This bill provided the State of New York with additional tools to
collect outstanding tax debt.

SUMMARY OF PROVISIONS:
Section 1 amends §32 of the Executive law by adding a section three,
which mandates that state agencies deny the renewal of professional
licenses to individuals unable to provide proof that they do not owe tax
debt.

Section 2 amends §401 of the State Administrative Procedure Act to state
that an individual must submit a self-certification, under penalty of
perjury, that they do not have a tax debt when seeking to renew a
license, and states that agencies may deny the renewal of a license to
individuals that owe tax debt.

Section 3 amends §53 of the Judiciary Law to state that an individual
must submit a self-certification, under penalty of perjury, that they do

not have a tax debt when seeking to renew their license as an attorney
or counselor at law.

Section 4 lays out an effective date of January 1, 2012.

EXISTING LAW:
Existing law does not give state agencies the authority to deny the
renewal of licenses based on a licensee owing tax debt to New York
State.

STATEMENT IN SUPPORT:
The ability to effectively collect taxes is crucial for the functioning
of State government. While the Department of Tax and Finance has various
powers and tools at its disposal to try to collect tax debt, according
to the department there was an outstanding collectable tax debt of $2.5
billion as of April 30,2009.

In several other states, such as Illinois, Massachusetts, Minnesota,
Missouri, Rhode Island, and Wisconsin, revenue departments have the
power to suspend or deny the renewal of professional licenses, and other
licenses, if an individual owes a tax debt to the state. These programs
have proven successful, and have been expanded and improved over the
last few years. In Illinois, an improvement in their ability to match
tax debt records with those of licensing agencies brought an additional
$4 million in revenue collected between February 2009 and the end of

June, 2009. Massachusetts granted the power to suspend or deny the
renewal of professional and driver's licenses to their Department of
Revenue starting in 2008, and from September 2008 to July 2009 this
program collected an additional $9 million in revenue.

This legislation would allow the State to deny renewal of professional
or business licenses if an entity was found to owe taxes to the State,
which is defined as having a tax warrant issued against them.  All State
agencies that license professionals would add as part of the license
renewal application a form in which individuals would, under penalty of
perjury, affirm that they did not owe a tax debt, or had entered into an
agreement with the Department of Tax and Finance to payoff the tax debt.
This is similar to the system which State agencies use to check compli-
ance with an individual's child support obligations. If any agency was
informed, or found out during any audits that an individual owed tax
debt at the time of the affirmation, they would be able to take action
against an individual, including revoking their license as a penalty for
lying on their renewal application.

PRIOR LEGISLATIVE HISTORY:
This is a new bill.

BUDGET IMPLICATIONS:
There will be costs associated with the creation of new self-affirmation
forms as part of the license renewal process. This bill shall also lead
to increased collections of outstanding tax debt, which would supersede
any costs, as these programs have in all other states that implement
them.

EFFECTIVE DATE:
The effective date of this act is January 1, 2012.

2009-S6161B (ACTIVE) - Bill Text download pdf

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

                                 6161--B

                       2009-2010 Regular Sessions

                            I N  S E N A T E

                            September 9, 2009
                               ___________

Introduced  by  Sen.  KLEIN  -- read twice and ordered printed, and when
  printed to be  committed  to  the  Committee  on  Rules  --  committee
  discharged, bill amended, ordered reprinted as amended and recommitted
  to  said  committee  --  recommitted  to  the  Committee on Finance in
  accordance with Senate Rule 6, sec. 8 --  committee  discharged,  bill
  amended,  ordered reprinted as amended and recommitted to said commit-
  tee

AN ACT to amend the executive law, the  state  administrative  procedure
  act and the judiciary law, in relation to the denial of the renewal of
  professional  licenses when the applicant has outstanding avoidance of
  state tax debt

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

  Section  1. Section 32 of the executive law, as added by chapter 55 of
the laws of 1992, is amended to read as follows:
  S 32. Authority not to renew. 1. For the purposes  of  this  section[,
"state]:  (A)  "STATE  agency"  shall  mean any state department, board,
bureau, division, commission, committee, public authority, public  bene-
fit  corporation, council, office, or other governmental entity perform-
ing a governmental or proprietary function  for  the  state,  AND  SHALL
INCLUDE THE EDUCATION DEPARTMENT.
  (B)  "TAX  DEBT"  SHALL  MEAN ALL LIABILITIES, INCLUDING UNPAID TAXES,
INTEREST AND PENALTIES, THAT THE COMMISSIONER OF TAXATION AND FINANCE IS
REQUIRED BY LAW TO COLLECT, AND THAT HAVE BEEN REDUCED  TO  JUDGMENT  BY
THE  DOCKETING OF A NEW YORK STATE TAX WARRANT WITH A COUNTY CLERK OR BY
THE FILING OF A COPY THEREOF WITH  THE  DEPARTMENT  OF  STATE,  AND  THE
TAXPAYER  DEBTOR  HAS  FAILED TO PAY SUCH LIABILITIES OR FAILED TO ENTER
INTO A WRITTEN AGREEMENT WITH THE DEPARTMENT OF TAXATION AND FINANCE  TO
SETTLE SUCH LIABILITIES.
  2.  Notwithstanding  any  other  provision of law, when a state agency
levies fees or assesses civil fines or penalties for licensing or  regu-

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD14691-16-0

S. 6161--B                          2

latory matters, such state agency shall, following consultation with the
[state]  department  of  law  and  after such appropriate due process as
required by the provisions of law applicable to such state agency and to
such  licensing  or  regulatory  matters,  not  be required to renew any
license, permit, or certificate of qualification, authority[,] or opera-
tion, of any business, individual[,] or other entity,  which  is  not  a
state  agency,  municipal  corporation  or district corporation, if such
business, individual or other entity has failed to pay or enter  into  a
written  agreement  to settle outstanding fees, civil penalties or fines
assessed by such state agency.
  3. (A) IT SHALL BE A CONDITION FOR THE RENEWAL OF ANY LICENSE, PERMIT,
CERTIFICATE OR REGISTRATION WHICH SPECIFICALLY AUTHORIZES ANY PERSON  OR
ENTITY  TO  CONDUCT ANY PROFESSION, BUSINESS OR TRADE THAT THE APPLICANT
FOR RENEWAL ATTEST, UNDER THE PENALTY OF PERJURY, TO  THE  STATE  AGENCY
RENEWING  THE  LICENSE,  PERMIT,  CERTIFICATE  OR  REGISTRATION THAT THE
APPLICANT DOES NOT HAVE A TAX DEBT.
  (B) NOTWITHSTANDING ANY OTHER PROVISION OF  LAW,  EVERY  STATE  AGENCY
WHICH  ISSUES  A  LICENSE,  PERMIT,  CERTIFICATE  OR  REGISTRATION WHICH
SPECIFICALLY AUTHORIZES ANY PERSON OR ENTITY TO CONDUCT ANY  PROFESSION,
BUSINESS  OR  TRADE MAY DENY THE APPLICATION FOR THE RENEWAL OF ANY SUCH
LICENSE, PERMIT, CERTIFICATE OR REGISTRATION TO  ANY  PERSON  OR  ENTITY
WHICH HAS A TAX DEBT.
  (C)  EVERY  APPLICATION  FOR THE RENEWAL OF A LICENSE, PERMIT, CERTIF-
ICATE OR REGISTRATION WHICH SPECIFICALLY AUTHORIZES ANY PERSON OR ENTITY
TO CONDUCT A PROFESSION, BUSINESS OR TRADE SHALL PROVIDE NOTICE  TO  THE
APPLICANT OF THE REQUIREMENTS OF THIS SUBDIVISION.
  S 2. Section 401 of the state administrative procedure act, as amended
by  chapter 935 of the laws of 1976, subdivision 1 as amended by chapter
469 of the laws of 1985, subdivision 4 as added by chapter  236  of  the
laws of 1987, is amended to read as follows:
  S 401. Licenses. 1. FOR THE PURPOSES OF THIS ARTICLE:
  (A)  "AGENCY"  SHALL  MEAN  AND INCLUDE THE STATE JUDICIAL BRANCH, THE
UNIFIED COURT SYSTEM, THE OFFICE OF COURT ADMINISTRATION AND THE MEANING
ASCRIBED TO SUCH TERM BY SUBDIVISION ONE OF SECTION ONE HUNDRED  TWO  OF
THIS ACT.
  (B)  "TAX  DEBT"  SHALL  MEAN ALL LIABILITIES, INCLUDING UNPAID TAXES,
INTEREST AND PENALTIES, THAT THE COMMISSIONER OF TAXATION AND FINANCE IS
REQUIRED BY LAW TO COLLECT, AND THAT HAVE BEEN REDUCED  TO  JUDGMENT  BY
THE  DOCKETING OF A NEW YORK STATE TAX WARRANT WITH A COUNTY CLERK OR BY
THE FILING OF A COPY THEREOF WITH  THE  DEPARTMENT  OF  STATE,  AND  THE
TAXPAYER  DEBTOR  HAS  FAILED TO PAY SUCH LIABILITIES OR FAILED TO ENTER
INTO A WRITTEN AGREEMENT WITH THE DEPARTMENT OF TAXATION AND FINANCE  TO
SETTLE SUCH LIABILITIES.
  2.  When  licensing  is  required  by law to be preceded by notice and
opportunity for hearing, the provisions of this chapter concerning adju-
dicatory proceedings apply. For purposes of this act, statutes providing
an opportunity for hearing shall be deemed to include statutes providing
an opportunity to be heard.
  [2.] 3. (A) IT SHALL BE A CONDITION FOR THE RENEWAL  OF  ANY  LICENSE,
PERMIT,  CERTIFICATE  OR  REGISTRATION WHICH SPECIFICALLY AUTHORIZES ANY
PERSON OR ENTITY TO CONDUCT ANY PROFESSION, BUSINESS OR TRADE  THAT  THE
APPLICANT FOR RENEWAL ATTEST, UNDER THE PENALTY OF PERJURY, TO THE AGEN-
CY  RENEWING  THE  LICENSE, PERMIT, CERTIFICATE OR REGISTRATION THAT THE
APPLICANT DOES NOT HAVE A TAX DEBT.
  (B) NOTWITHSTANDING ANY OTHER PROVISION OF  LAW,  EVERY  AGENCY  WHICH
ISSUES A LICENSE, PERMIT, CERTIFICATE OR REGISTRATION WHICH SPECIFICALLY

S. 6161--B                          3

AUTHORIZES  ANY  PERSON OR ENTITY TO CONDUCT ANY PROFESSION, BUSINESS OR
TRADE MAY DENY THE APPLICATION FOR THE  RENEWAL  OF  ANY  SUCH  LICENSE,
PERMIT,  CERTIFICATE OR REGISTRATION TO ANY PERSON OR ENTITY WHICH HAS A
TAX DEBT.
  (C)  EVERY  APPLICATION  FOR THE RENEWAL OF A LICENSE, PERMIT, CERTIF-
ICATE OR REGISTRATION WHICH SPECIFICALLY AUTHORIZES ANY PERSON OR ENTITY
TO CONDUCT A PROFESSION, BUSINESS OR TRADE SHALL PROVIDE NOTICE  TO  THE
APPLICANT OF THE REQUIREMENTS OF THIS SUBDIVISION.
  4.  When a licensee has made timely and sufficient application for the
renewal of a license or a new license with reference to any activity  of
a  continuing  nature,  the  existing  license does not expire until the
application has been finally determined by the agency, and, in case  the
application is denied or the terms of the new license limited, until the
last day for seeking review of the agency order or a later date fixed by
order  of  the reviewing court, provided that this subdivision shall not
affect any valid agency action then in effect summarily suspending  such
license.
  [3.]  5.  If  the  agency finds that public health, safety, or welfare
imperatively requires emergency action, and incorporates  a  finding  to
that  effect  in  its  order,  summary  suspension  of  a license may be
ordered, effective on the date specified in such order or  upon  service
of  a  certified  copy of such order on the licensee, whichever shall be
later,  pending  proceedings  for  revocation  or  other  action.  These
proceedings shall be promptly instituted and determined.
  [4.]  6.  When the hearing seeks the revocation of a license or permit
previously granted by the agency, either party shall, upon demand and at
least seven days prior to the hearing, disclose the  evidence  that  the
party  intends  to  introduce  at  the  hearing,  including  documentary
evidence  and  identification  of  witnesses,  provided,  however,   the
provisions  of  this  subdivision  shall  not  be  deemed to require the
disclosure of information or material otherwise protected  by  law  from
disclosure,  including  information  and  material  protected because of
privilege or confidentiality. If, after such disclosure, a party  deter-
mines  to  rely upon other witnesses or information, the party shall, as
soon as practicable, supplement its disclosure by providing the names of
such witnesses or the additional documents.
  S 3. Section 53 of the judiciary law is amended by adding a new subdi-
vision 7 to read as follows:
  7. (A) FOR THE PURPOSES OF THIS SUBDIVISION, "TAX DEBT" SHALL MEAN ALL
LIABILITIES, INCLUDING UNPAID TAXES, INTEREST AND  PENALTIES,  THAT  THE
COMMISSIONER  OF TAXATION AND FINANCE IS REQUIRED BY LAW TO COLLECT, AND
THAT HAVE BEEN REDUCED TO JUDGMENT BY THE DOCKETING OF A NEW YORK  STATE
TAX  WARRANT  WITH  A  CLERK OR BY THE FILING OF A COPY THEREOF WITH THE
DEPARTMENT OF STATE, AND THE TAXPAYER DEBTOR  HAS  FAILED  TO  PAY  SUCH
LIABILITIES OR FAILED TO ENTER INTO A WRITTEN AGREEMENT WITH THE DEPART-
MENT OF TAXATION AND FINANCE TO SETTLE SUCH LIABILITIES.
  (B)(I)  EVERY  APPELLATE DIVISION MAY DENY THE APPLICATION FOR RENEWAL
OF ADMISSION TO PRACTICE AS AN ATTORNEY AND COUNSELLOR  AT  LAW  OF  ANY
PERSON WHO HAS A TAX DEBT.
  (II) THE COURT OF APPEALS SHALL ADOPT RULES ESTABLISHING THAT IT SHALL
BE  A  CONDITION FOR THE RENEWAL OF ADMISSION TO PRACTICE AS AN ATTORNEY
AND COUNSELLOR AT LAW THAT THE APPLICANT ATTEST, UNDER  THE  PENALTY  OF
PERJURY,  TO  THE  APPELLATE DIVISION THAT THE APPLICANT DOES NOT HAVE A
TAX DEBT.

S. 6161--B                          4

  (III) EVERY APPLICATION FOR RENEWAL OF ADMISSION  TO  PRACTICE  AS  AN
ATTORNEY  AND COUNSELLOR AT LAW SHALL PROVIDE NOTICE TO THE APPLICANT OF
THE REQUIREMENTS OF THIS PARAGRAPH.
  S 4. This act shall take effect January 1, 2012.

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