S T A T E   O F   N E W   Y O R K
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                                  4567

                       2013-2014 Regular Sessions

                          I N  A S S E M B L Y

                            February 6, 2013
                               ___________

Introduced  by M. of A. KOLB, OAKS, WALTER, REILICH, PALMESANO, MONTESA-
  NO, P. LOPEZ, GOODELL, RAIA, HAWLEY, BARCLAY -- Multi-Sponsored by  --
  M.  of A. CERETTO, McLAUGHLIN -- read once and referred to the Commit-
  tee on Economic Development

AN ACT to amend the  economic  development  law  and  the  tax  law,  in
  relation to enacting the BizBoom program act

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

  Section 1. The economic development law is amended  by  adding  a  new
article 21 to read as follows:
                                ARTICLE 21
                           BIZBOOM PROGRAM ACT
SECTION 450. SHORT TITLE.
        451. STATEMENT OF LEGISLATIVE FINDINGS AND DECLARATION.
        452. DEFINITIONS.
        453. ELIGIBILITY CRITERIA.
        454. APPLICATION AND APPROVAL PROCESS.
        455. POWERS AND DUTIES OF THE COMMISSIONER.
  S  450.  SHORT  TITLE. THIS ARTICLE SHALL BE KNOWN AND MAY BE CITED AS
THE "BIZBOOM PROGRAM ACT".
  S 451. STATEMENT OF LEGISLATIVE FINDINGS AND DECLARATION. IT IS HEREBY
FOUND AND DECLARED THAT NEW YORK STATE NEEDS,  AS  A  MATTER  OF  PUBLIC
POLICY,  TO  CREATE  COMPETITIVE  FINANCIAL INCENTIVES FOR BUSINESSES TO
LOCATE AND INVEST IN NEW YORK STATE.  THE BIZBOOM PROGRAM ACT IS CREATED
TO INCENTIVIZE THE SITING OF NEW BUSINESSES AND THE  CREATION  OF  BUSI-
NESSES IN OUR STATE.
  THIS  LEGISLATION  CREATES  THE  BIZBOOM PROGRAM, WHICH PROVIDES A TAX
EXEMPT BENEFIT TO NEW BUSINESSES RELOCATING TO  OR  STARTING  UP  A  NEW
BUSINESS  IN  NEW  YORK.  THE BIZBOOM TAX EXEMPTION FOR QUALIFYING BUSI-
NESSES IS ONE HUNDRED PERCENT THE FIRST YEAR, FIFTY PERCENT OF THE BUSI-
NESS TAX LIABILITY  IN  THE  SECOND  YEAR,  AND  A  TWENTY-FIVE  PERCENT

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD03321-01-3
              

A. 4567                             2

EXEMPTION  IN  THE  THIRD YEAR.   THIS EXEMPTION WOULD DISCONTINUE AFTER
THREE YEARS AND ANY PARTICIPATING BUSINESS THAT LEAVES THE STATE  BEFORE
COMPLETING SIX YEARS OF OPERATION WOULD BE LIABLE TO REPAY ALL TAX BENE-
FITS  RECEIVED  UNDER  THE  PROGRAM.  THESE  EXEMPTIONS  ARE DESIGNED TO
PROMOTE BUSINESS EXPANSION AND INCREASE JOBS IN NEW YORK STATE.  AT  THE
SAME  TIME,  THE  PROGRAM  PROTECTS STATE TAXPAYERS' DOLLARS BY ENSURING
THAT NEW YORK PROVIDES TAX BENEFITS ONLY TO  BUSINESSES  THAT  REPRESENT
NEW INVESTMENT IN OUR STATE.
  S  452.  DEFINITIONS.  FOR  THE  PURPOSES OF THIS ARTICLE: 1. "BIZBOOM
BUSINESS" MEANS A BUSINESS ENTITY THAT HAS BEEN DETERMINED TO BE A NEWLY
FORMED BUSINESS IN NEW YORK, AS DETERMINED BY THE COMMISSIONER OF  TAXA-
TION AND FINANCE AND THE DEPARTMENT.
  2.  "CERTIFICATE  OF  ELIGIBILITY"  MEANS  THE  DOCUMENT ISSUED BY THE
DEPARTMENT TO AN APPLICANT THAT  HAS  COMPLETED  AN  APPLICATION  TO  BE
ADMITTED INTO THE BIZBOOM PROGRAM AND HAS BEEN ACCEPTED INTO THE PROGRAM
BY  THE  DEPARTMENT. POSSESSION OF A CERTIFICATE OF ELIGIBILITY DOES NOT
BY ITSELF GUARANTEE THE ELIGIBILITY TO CLAIM THE TAX EXEMPTION.
  3. "CERTIFICATE OF TAX EXEMPTION"  MEANS  THE  DOCUMENT  ISSUED  TO  A
PARTICIPANT  BY  THE DEPARTMENT AS AUTHORIZED BY THE DEPARTMENT OF TAXA-
TION AND FINANCE, AFTER THE DEPARTMENT HAS VERIFIED THAT THE PARTICIPANT
HAS MET ALL APPLICABLE ELIGIBILITY CRITERIA IN THIS ARTICLE.
  S 453. ELIGIBILITY CRITERIA. 1. TO BE A  PARTICIPANT  IN  THE  BIZBOOM
PROGRAM,  A  QUALIFYING BUSINESS ENTITY SHALL HAVE NOT OPERATED OR SHALL
NOT HAVE HAD NEXUS IN NEW YORK STATE PRIOR TO  THE  FIRST  YEAR  OF  THE
IMPLEMENTATION  OF  THIS  ACT  AND ANY OTHER CRITERIA ESTABLISHED BY THE
COMMISSIONER IN REGULATIONS PROMULGATED PURSUANT  TO  THIS  ARTICLE.  IN
PROMULGATING SUCH REGULATIONS THE COMMISSIONER SHALL INCLUDE A REVIEW OF
SUCH NEW BUSINESS CREATION CRITERIA.
  2.  FOR  THE  PURPOSES OF THIS ARTICLE, IN ORDER TO PARTICIPATE IN THE
BIZBOOM JOBS PROGRAM A BUSINESS MUST BE IN COMPLIANCE  WITH  ALL  WORKER
PROTECTION  AND ENVIRONMENTAL LAWS AND REGULATIONS. IN ADDITION, A BUSI-
NESS MAY NOT OWE PAST DUE STATE TAXES, LOCAL PROPERTY TAXES OR ANY FINES
ISSUED BY THE STATE OR MUNICIPALITY.
  S 454. APPLICATION AND APPROVAL PROCESS. 1.  A  BUSINESS  ENTITY  MUST
SUBMIT A COMPLETED APPLICATION AS PRESCRIBED BY THE COMMISSIONER.
  2. AS PART OF SUCH APPLICATION, EACH BUSINESS ENTITY MUST:
  (A)  AGREE  TO  ALLOW THE DEPARTMENT TO SHARE ITS TAX INFORMATION WITH
THE DEPARTMENT OF LABOR AND DEPARTMENT OF TAXATION AND FINANCE. HOWEVER,
ANY INFORMATION SHARED AS A RESULT OF THIS AGREEMENT SHALL NOT BE AVAIL-
ABLE FOR DISCLOSURE OR INSPECTION UNDER THE STATE FREEDOM OF INFORMATION
LAW.
  (B) AGREE TO ALLOW THE DEPARTMENT OF LABOR AND DEPARTMENT OF  TAXATION
AND  FINANCE  TO SHARE ITS TAX AND EMPLOYER INFORMATION WITH THE DEPART-
MENT.  HOWEVER, ANY INFORMATION SHARED AS A  RESULT  OF  THIS  AGREEMENT
SHALL  NOT  BE  AVAILABLE  FOR  DISCLOSURE OR INSPECTION UNDER THE STATE
FREEDOM OF INFORMATION LAW.
  (C) ALLOW THE DEPARTMENT AND ITS AGENTS ACCESS TO ANY  AND  ALL  BOOKS
AND RECORDS THE DEPARTMENT MAY REQUIRE TO MONITOR COMPLIANCE.
  (D) PROVIDE THE FOLLOWING INFORMATION TO THE DEPARTMENT UPON REQUEST:
  (I) A PLAN OUTLINING THE SCHEDULE FOR JOB CREATION AND INVESTMENTS;
  (II) UNEMPLOYMENT INSURANCE QUARTERLY RETURNS, REAL PROPERTY TAX BILLS
AND AUDITED FINANCIAL STATEMENTS;
  (III)  THE AMOUNT AND DESCRIPTION OF PROJECTED TAX LIABILITY FOR WHICH
IT PLANS TO CLAIM THE BIZBOOM TAX EXEMPTIONS; AND

A. 4567                             3

  (IV) THE EMPLOYER IDENTIFICATION OR SOCIAL SECURITY  NUMBERS  FOR  ALL
RELATED  PERSONS  TO  THE APPLICANT, INCLUDING THOSE OF ANY MEMBERS OF A
LIMITED LIABILITY COMPANY OR PARTNERS IN A PARTNERSHIP.
  (E)  CERTIFY,  UNDER  PENALTY  OF  PERJURY,  THAT IT IS IN SUBSTANTIAL
COMPLIANCE WITH ALL ENVIRONMENTAL, WORKER PROTECTION, AND LOCAL,  STATE,
AND FEDERAL TAX LAWS.
  3.  AFTER  REVIEWING  A  BUSINESS  ENTITY'S  COMPLETED APPLICATION AND
DETERMINING THAT THE BUSINESS ENTITY WILL MEET THE CONDITIONS SET  FORTH
IN  SECTION FOUR HUNDRED FIFTY-THREE OF THIS ARTICLE, THE DEPARTMENT MAY
ADMIT THE APPLICANT INTO THE PROGRAM AND PROVIDE THE  APPLICANT  WITH  A
CERTIFICATE OF ELIGIBILITY.
  4.  IN ORDER TO BECOME A PARTICIPANT IN THE PROGRAM, AN APPLICANT MUST
SUBMIT EVIDENCE OF BEING A NEWLY FORMED BUSINESS ENTITY IN SUCH FORM  AS
THE  COMMISSIONER MAY PRESCRIBE. AFTER REVIEWING SUCH EVIDENCE AND FIND-
ING IT SUFFICIENT, THE DEPARTMENT  SHALL  CERTIFY  THE  APPLICANT  AS  A
PARTICIPANT   AND  ISSUE  TO  THAT  PARTICIPANT  A  CERTIFICATE  OF  TAX
EXEMPTION.
  5. A PARTICIPANT MAY CLAIM TAX BENEFITS COMMENCING IN THE FIRST  TAXA-
BLE  YEAR  THAT  THE  BUSINESS  ENTITY  RECEIVES  A  CERTIFICATE  OF TAX
EXEMPTION. A PARTICIPANT MAY  CLAIM  A  TAX  EXEMPTION  OF  ONE  HUNDRED
PERCENT  OF  THE  TAX  LIABILITY  IN  THE FIRST YEAR OF OPERATION, FIFTY
PERCENT EXEMPTION OF THE BUSINESS TAX LIABILITY IN THE  SECOND  YEAR  OF
OPERATION,  AND  A  TWENTY-FIVE  PERCENT  EXEMPTION  OF THE BUSINESS TAX
LIABILITY IN THE THIRD YEAR OF OPERATION, PROVIDED THAT THE  PARTICIPANT
DEMONSTRATES  TO  THE DEPARTMENT THAT IT CONTINUES TO SATISFY THE ELIGI-
BILITY CRITERIA SPECIFIED IN SECTION FOUR HUNDRED  FIFTY-THREE  OF  THIS
ARTICLE  AND  SUBDIVISION  TWO  OF THIS SECTION IN EACH OF THOSE TAXABLE
YEARS.
  S 455. POWERS AND DUTIES OF  THE  COMMISSIONER.  1.  THE  COMMISSIONER
SHALL  PROMULGATE  REGULATIONS  ESTABLISHING  AN APPLICATION PROCESS AND
ELIGIBILITY CRITERIA, THAT WILL BE APPLIED CONSISTENT WITH THE  PURPOSES
OF THIS ARTICLE.
  2.  THE  COMMISSIONER  SHALL,  IN  CONSULTATION WITH THE DEPARTMENT OF
TAXATION AND FINANCE, DEVELOP A CERTIFICATE OF TAX EXEMPTION THAT  SHALL
BE ISSUED BY THE COMMISSIONER TO PARTICIPANTS. PARTICIPANTS MUST INCLUDE
THE  CERTIFICATE  OF  TAX EXEMPTION WITH THEIR TAX RETURN TO RECEIVE ANY
TAX BENEFITS UNDER THIS ARTICLE.
  3. THE COMMISSIONER SHALL, IN  CONSULTATION  WITH  THE  DEPARTMENT  OF
TAXATION  AND  FINANCE AND THE DEPARTMENT OF LABOR, DETERMINE THE ELIGI-
BILITY OF ANY APPLICANT APPLYING FOR ENTRY INTO THE  PROGRAM  AND  SHALL
REMOVE  ANY  PARTICIPANT FROM THE PROGRAM FOR FAILING TO MEET ANY OF THE
REQUIREMENTS SET FORTH IN SECTION  FOUR  HUNDRED  FIFTY-THREE  AND  FOUR
HUNDRED FIFTY-FOUR OF THIS ARTICLE.
  S  2.  The  tax  law  is amended by adding a new section 38 to read as
follows:
  S 38. BIZBOOM PROGRAM EXEMPTION. (A) GENERAL.  A TAXPAYER  SUBJECT  TO
TAX  UNDER  ARTICLES  NINE-A  AND  TWENTY-TWO  OF  THIS CHAPTER SHALL BE
ALLOWED AN EXEMPTION AGAINST SUCH TAX, ALLOWABLE FOR UP TO THREE CONSEC-
UTIVE TAXABLE YEARS, IS PROVIDED AS FOLLOWS:
  (1) ONE HUNDRED PERCENT EXEMPTION IN YEAR ONE OF OPERATION;
  (2) FIFTY PERCENT EXEMPTION IN YEAR TWO OF OPERATION; AND
  (3) TWENTY-FIVE PERCENT EXEMPTION IN YEAR THREE OF OPERATION.
  (B) TO BE ELIGIBLE FOR THE BIZBOOM  PROGRAM  EXEMPTION,  THE  TAXPAYER
SHALL  HAVE  BEEN ISSUED A "CERTIFICATE OF TAX EXEMPTION" BY THE DEPART-
MENT OF ECONOMIC DEVELOPMENT PURSUANT TO  SUBDIVISION  FOUR  OF  SECTION
FOUR  HUNDRED  FIFTY-FOUR OF THE ECONOMIC DEVELOPMENT LAW, WHICH CERTIF-

A. 4567                             4

ICATE SHALL SET FORTH THE AMOUNT OF EACH EXEMPTION COMPONENT THAT MAY BE
CLAIMED FOR THE TAXABLE YEAR. A TAXPAYER MAY CLAIM  SUCH  EXEMPTION  FOR
THREE  CONSECUTIVE  TAXABLE  YEARS  COMMENCING IN THE FIRST TAXABLE YEAR
THAT  THE TAXPAYER RECEIVES A CERTIFICATE OF TAX EXEMPTION. THE TAXPAYER
SHALL BE ALLOWED TO CLAIM ONLY  THE  PERCENTAGE  AMOUNT  LISTED  ON  THE
CERTIFICATE  OF  TAX  EXEMPTION  FOR THAT TAXABLE YEAR. SUCH CERTIFICATE
SHOULD BE ATTACHED TO THE TAXPAYER'S RETURN. NO COST OR EXPENSE PAID  OR
INCURRED  BY THE TAXPAYER SHALL BE THE BASIS FOR MORE THAN ONE COMPONENT
OF THIS EXEMPTION OR ANY OTHER TAX EXEMPTION.
  (C) EXEMPTION RECAPTURE. IF A CERTIFICATE OF ELIGIBILITY OR A  CERTIF-
ICATE  OF TAX EXEMPTION ISSUED BY THE DEPARTMENT OF ECONOMIC DEVELOPMENT
UNDER ARTICLE TWENTY-ONE OF THE ECONOMIC DEVELOPMENT LAW IS  REVOKED  BY
SUCH  DEPARTMENT,  THE AMOUNT OF EXEMPTION DESCRIBED IN THIS SECTION AND
CLAIMED BY THE TAXPAYER PRIOR TO THAT REVOCATION SHALL BE ADDED BACK  TO
INCOME IN THE TAXABLE YEAR IN WHICH ANY SUCH REVOCATION BECOMES FINAL.
  S  3.  The tax law is amended by adding a new section 207-c to read as
follows:
  S 207-C. EXEMPTION OF BIZBOOM PROGRAM PARTICIPANTS. THIS ARTICLE SHALL
NOT APPLY TO ANY BUSINESS ENTITY WHICH IS A  QUALIFIED  BIZBOOM  PARTIC-
IPANT AS PROVIDED BY SECTION THIRTY-EIGHT OF THIS CHAPTER.
  S 4. Section 210 of the tax law is amended by adding a new subdivision
46 to read as follows:
  46. BIZBOOM PROGRAM EXEMPTION. (A) ALLOWANCE OF EXEMPTION.  A TAXPAYER
WILL  BE  ALLOWED  AN  EXEMPTION,  TO BE COMPUTED AS PROVIDED IN SECTION
THIRTY-EIGHT OF THIS CHAPTER, AGAINST THE TAX IMPOSED BY THIS ARTICLE.
  (B) APPLICATION OF EXEMPTION. THE EXEMPTION ALLOWED UNDER THIS  SUBDI-
VISION  FOR ANY TAXABLE YEAR MAY NOT REDUCE THE TAX DUE FOR SUCH YEAR TO
LESS THAN THE HIGHER OF THE AMOUNTS PRESCRIBED IN PARAGRAPHS (C) AND (D)
OF SUBDIVISION ONE OF THIS SECTION. HOWEVER, IF THE AMOUNT OF  EXEMPTION
ALLOWED  UNDER  THIS SUBDIVISION FOR ANY TAXABLE YEAR REDUCES THE TAX TO
SUCH AMOUNT, ANY AMOUNT OF EXEMPTION THUS NOT DEDUCTIBLE IN SUCH TAXABLE
YEAR WILL BE TREATED AS AN OVERPAYMENT OF TAX TO BE EXEMPTED OR REFUNDED
IN ACCORDANCE WITH THE PROVISIONS OF SECTION ONE THOUSAND EIGHTY-SIX  OF
THIS  CHAPTER.  PROVIDED,  HOWEVER,  THE PROVISIONS OF SUBSECTION (C) OF
SECTION ONE THOUSAND EIGHTY-EIGHT OF THIS  CHAPTER  NOTWITHSTANDING,  NO
INTEREST WILL BE PAID THEREON.
  S  5. Section 601 of the tax law is amended by adding a new subsection
(j) to read as follows:
  (J)  BIZBOOM  PROGRAM  PARTICIPANTS.  A  QUALIFYING  BUSINESS  ENTITY,
PARTICIPATING  IN  THE BIZBOOM PROGRAM PURSUANT TO ARTICLE TWENTY OF THE
ECONOMIC DEVELOPMENT LAW, WHICH IS TAXABLE  AS  A  BUSINESS  ENTITY  FOR
FEDERAL INCOME TAX PURPOSES SHALL NOT BE SUBJECT TO TAX UNDER THIS ARTI-
CLE;  SUBJECT  TO THE LIMITATION AS PROVIDED FOR BY SECTION THIRTY-EIGHT
OF THIS CHAPTER.
  S 6. Section 606 of the tax law is amended by adding a new  subsection
(vv) to read as follows:
  (VV)  BIZBOOM  PROGRAM  PARTICIPANTS.  CREDITS  ALLOWABLE  UNDER  THIS
SECTION THAT A TAXPAYER IS ELIGIBLE FOR THAT RELATE TO THE BUSINESS WILL
BE REDUCED BY ONE HUNDRED PERCENT IN THE FIRST YEAR OF OPERATION,  FIFTY
PERCENT  IN THE SECOND YEAR OF OPERATION, AND TWENTY-FIVE PERCENT IN THE
THIRD YEAR OF OPERATION.
  S 7. Subsection (c) of section 612 of the tax law is amended by adding
a new paragraph 39 to read as follows:
  (39) BUSINESS INCOME, TO THE EXTENT INCLUDIBLE  IN  GROSS  INCOME  FOR
FEDERAL  INCOME  TAX  PURPOSES,  IF THE TAXPAYER IS AUTHORIZED UNDER THE
BIZBOOM  PROGRAM;  ONE  HUNDRED  PERCENT  OF  BUSINESS  INCOME  WILL  BE

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SUBTRACTED FROM FEDERALLY ADJUSTED GROSS INCOME IN THE FIRST YEAR, FIFTY
PERCENT IN THE SECOND YEAR, AND TWENTY-FIVE PERCENT IN THE THIRD YEAR.
  S 8. Subsection (c) of section 615 of the tax law is amended by adding
a new paragraph 9 to read as follows:
  (9)  THE  AMOUNT  OF  ANY  FEDERAL  DEDUCTION FOR ANY BUSINESS RELATED
EXPENSE FOR A TAXPAYER AUTHORIZED UNDER  THE  BIZBOOM  PROGRAM  WILL  BE
REDUCED  BY  ONE HUNDRED PERCENT IN THE FIRST YEAR, FIFTY PERCENT IN THE
SECOND YEAR, AND TWENTY-FIVE PERCENT IN THE THIRD YEAR.
  S 9. Notwithstanding any other provision of law, rule  or  regulation,
any and all application fees related to the creation of a business enti-
ty shall be reduced by fifty percent.
  S 10. This act shall take effect January 1, 2014.