senate Bill S6699

2013-2014 Legislative Session

Establishes the study and stay program whereby a resident taxpayer, who received their bachelor's degree in this state, can set aside a portion of his or her tax payments for a down payment on a home

download bill text pdf

Sponsored By

Archive: Last Bill Status - In Committee


  • Introduced
  • In Committee
  • On Floor Calendar
    • Passed Senate
    • Passed Assembly
  • Delivered to Governor
  • Signed/Vetoed by Governor

do you support this bill?

Actions

view actions (1)
Assembly Actions - Lowercase
Senate Actions - UPPERCASE
Feb 28, 2014 referred to investigations and government operations

Co-Sponsors

S6699 - Bill Details

Current Committee:
Law Section:
Tax Law
Laws Affected:
Add §608, Tax L; add §85, St Fin L

S6699 - Bill Texts

view summary

Establishes the study and stay program whereby a resident taypayer, who received their bachelor's degree in this state, can set aside a portion of his or her tax payments for a down payment on a first home.

view sponsor memo
BILL NUMBER:S6699

TITLE OF BILL: An act to amend the tax law and the state finance law,
in relation to establishing the study and stay program

PURPOSE: To establish the Study and Stay Program allowing graduates
from New York colleges to set aside a portion of their tax payments
for a down payment on a home.

SUMMARY OF PROVISIONS:

Section 1: Amends the tax law by adding a new section 608 establishing
the Study and Stay Program. This section defines an "eligible
taxpayer" as a resident taxpayer who received a bachelor's degree
awarded by a college or university located in New York State after
January 1, 2015, who has never had an ownership interest in a
residential real property. Defines "ownership interest" as a fee
simple interest, joint tenancy, tenancy in common, tenancy by
entirety, interest of a tenant-shareholder in a residential
cooperative, a life estate, and a land contract.

The Study and Stay Program will allow eligible taxpayers to annually
deposit no more than $5,000 of his or her State Personal Income Tax
liability into an account designated for such taxpayer in the program.
Eligible taxpayers will be allowed to do this for a period not to
exceed 10 years after receipt of a bachelor's degree. Moneys so
deposited may only be withdrawn for the purpose of a down payment
toward the purchase of his or her first owner-occupied residential
real property.

The Department of Taxation and Finance shall provide a space on the
Personal Income Tax Returns to enable taxpayers to designate moneys
into the Study and Stay Program fund. No more than $10 million may be
designated to this program in any tax year. Eligible taxpayers must
submit proof to the Department of Taxation and Finance of receipt and
the date of receipt of a bachelor's degree from a college or
university located in the State.

Section 2: Amends the state finance law by adding a new section 85
establishing the Study and Stay Program Fund in the joint custody of
the State Comptroller and the Commissioner of Taxation and Finance.
The State Comptroller shall create a separate and distinct account for
each eligible taxpayer in the Study and Stay Program. The moneys in
said account must be made available within 10 days of submission by a
taxpayer for their use toward a down payment on a first purchase of
residential real property.

Within 60 days of receipt of moneys, the taxpayer must submit a sworn
statement to the State Comptroller and the Commissioner of Taxation
and Finance certifying that moneys were used toward this purpose.

Any moneys remaining in the account following disbursement to the
eligible taxpayer; remaining in the account in the 11th year after
receipt of a bachelor's degree; and remaining when the eligible
taxpayer ceases to be a resident of New York State shall be returned
to the general fund. Additionally, a penalty will be imposed for
eligible taxpayers who make a down payment and cease to be a resident


of the State during a certain timeframe. These penalties may be waived
due to relocation due to employment requiring residency in another
state, or a severe financial hardship.

Section 3: This act shall take effect immediately.

JUSTIFICATION: Earning a college degree is still one of the biggest
aspirations for New York's teenagers. A recent survey conducted by the
Pew Research Center found that 94% of parents expect their child to
attend college. This is because college is seen as the bedrock of the
American middle class. A high education not only stimulates
intellectual and personal growth, but allows our young adults to
develop the skills necessary to begin a successful career.

Unfortunately, it is increasingly expensive to attend college. During
the 2012-2013 academic year, it cost the average student $34,085 to
attend a private, four-year college in New York. This made us the 10th
most expensive state in the country. Likewise, the College Board found
that since 2004-2005, public university costs grew by 33%.

To meet this enormous price tag, individuals are taking on greater
amounts of student loans. The American Student Association reports
that 60% of college students borrow annually to finance their
education. In 2012, total outstanding student loan debt reached $966
billion; a level of debt second only to mortgages.

In New York, 60% of the class of 2011 graduated with such debt at an
average of $26,388. This figure is equivalent to 55% of the average
annual earnings of New York graduates under 30, all but guaranteeing a
repayment battle for years to come. At the same time, graduate
earnings are not as strong as they once were. Since 2000, earnings for
25 to 34 year-olds holding a bachelor's degree fell 15%. The
combination of lower earning and a high debt load make it increasingly
difficult for college students to make big purchases, which causes a
drag on lifetime wealth.

One such purchase is a home. Following the Great Recession,
homeownership rates among recent graduates fell by over 10%.
According to the Federal Reserve Bank of New York, for the first time
in at least a decade, 30-years olds without a student debt were more
likely to own a home than student debtors. It is especially difficult
for graduates to purchase a home in New York, which had the third
highest down payment rate in the country in 2013.

A college degree should bring a lifetime of rewards, not financial
struggle. That is why we propose the establishment of a Study and Stay
Program. If enacted, this program will make it affordable once again
for college graduates to own a New York home.

Study and Stay will allow graduates from a four-year, New York college
to receive a credit of up to $5,000 from their State Income Tax for up
to 10 years. When such a graduate seeks to purchase a home, they may
use these funds toward the down payment of a first home. With the
Study and Stay Program, we can not only allow more graduates to attain
the goal of homeownership, but also renew New York as a premier
destination for younger generations.


LEGISLATIVE HISTORY: New Bill.

FISCAL IMPLICATIONS: $10 million in tax expenditures when fully
phased implemented.

EFFECTIVE DATE: This act shall take effect immediately.

view full text
download pdf
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                  6699

                            I N  S E N A T E

                            February 28, 2014
                               ___________

Introduced  by  Sens. VALESKY, CARLUCCI, KLEIN, SAVINO -- read twice and
  ordered printed, and when printed to be committed to the Committee  on
  Investigations and Government Operations

AN  ACT  to  amend the tax law and the state finance law, in relation to
  establishing the study and stay program

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

  Section  1. The tax law is amended by adding a new section 608 to read
as follows:
  S 608. STUDY AND STAY PROGRAM. (A) FOR THE PURPOSES OF THIS SECTION:
  (1) "ELIGIBLE TAXPAYER" MEANS A RESIDENT TAXPAYER WHO RECEIVED A BACH-
ELOR'S DEGREE AWARDED BY AN INSTITUTION  OF  HIGHER  EDUCATION  IN  THIS
STATE  AFTER JANUARY FIRST, TWO THOUSAND FIFTEEN, WHO DOES NOT HAVE  NOR
EVER HAD AN OWNERSHIP INTEREST IN THE RESIDENTIAL REAL PROPERTY IN WHICH
HE OR SHE RESIDED. FURTHERMORE, AN ELIGIBLE TAXPAYER SHALL NOT  HAVE  AN
OWNERSHIP  IN  ANY  OTHER  RESIDENTIAL REAL PROPERTY, INCLUDING VACATION
HOMES OR RESIDENTIAL RENTAL PROPERTY.
  (2) "OWNERSHIP INTEREST" MEANS AND INCLUDES A FEE SIMPLE  INTEREST,  A
JOINT  TENANCY,  A  TENANCY  IN  COMMON,  A TENANCY BY THE ENTIRETY, THE
INTEREST OF A TENANT-SHAREHOLDER IN A RESIDENTIAL  COOPERATIVE,  A  LIFE
ESTATE AND A LAND CONTRACT. SUCH TERM SHALL NOT INCLUDE:
  (A) REMAINDER INTERESTS;
  (B) A LEASE WITH OR WITHOUT AN OPTION TO PURCHASE;
  (C) A MERE EXPECTANCY TO INHERIT AN INTEREST IN RESIDENTIAL REAL PROP-
ERTY;
  (D)  THE  INTEREST  THAT  A  PURCHASER  OF  RESIDENTIAL  REAL PROPERTY
ACQUIRES UPON THE EXECUTION OF A PURCHASE CONTRACT; OR
  (E) AN INTEREST IN REAL ESTATE OTHER THAN RESIDENTIAL REAL PROPERTY.
  (B) THERE SHALL BE ESTABLISHED BY THE  DEPARTMENT  A  STUDY  AND  STAY
PROGRAM  WHEREBY  ELIGIBLE  TAXPAYERS MAY DESIGNATE, FOR A PERIOD OF NOT
MORE THAN THE TEN TAX YEARS FOLLOWING SUCH TAXPAYER'S RECEIPT OF HIS  OR
HER BACHELOR'S DEGREE, NOT MORE THAN FIVE THOUSAND DOLLARS OF HIS OR HER
PAYMENT OF THE TAXES IMPOSED PURSUANT TO THIS ARTICLE FOR A TAX YEAR FOR
DEPOSIT  INTO  AN  ACCOUNT DESIGNATED FOR SUCH TAXPAYER WITHIN THE STUDY

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD13498-01-4

S. 6699                             2

AND STAY PROGRAM FUND ESTABLISHED BY SECTION EIGHTY-FIVE  OF  THE  STATE
FINANCE LAW. THE MONEYS SO DEPOSITED INTO AN ELIGIBLE TAXPAYER'S ACCOUNT
SHALL  ONLY BE WITHDRAWN THEREFROM AND EXPENDED BY SUCH TAXPAYER FOR THE
PAYMENT OF THE DOWN PAYMENT FOR HIS OR HER FIRST PURCHASE OF OWNER-OCCU-
PIED RESIDENTIAL REAL PROPERTY.
  (C)  THE  DESIGNATION  OF ALL OR ANY PORTION OF AN ELIGIBLE TAXPAYER'S
TAX PAYMENT DURING ANY TAX YEAR, SHALL NOT BE DEEMED  TO  INCREASE  SUCH
TAXPAYER'S LIABILITY FOR TAXES PURSUANT TO THIS ARTICLE. THE COMMISSION-
ER  SHALL  INCLUDE  A SPACE ON THE PERSONAL INCOME TAX RETURNS TO ENABLE
ELIGIBLE TAXPAYERS TO DESIGNATE MONEYS FOR DEPOSIT INTO  THE  STUDY  AND
STAY PROGRAM FUND.
  (D) EACH TAX YEAR, THE COMMISSIONER SHALL TRANSFER, TO THE STATE COMP-
TROLLER,  FOR DEPOSIT INTO THE APPROPRIATE ACCOUNTS WITHIN THE STUDY AND
STAY PROGRAM FUND, ALL MONEYS DESIGNATED BY ELIGIBLE TAXPAYERS  PURSUANT
TO THIS SECTION; PROVIDED, HOWEVER, THAT IN NO EVENT SHALL MORE THAN TEN
MILLION DOLLARS, IN THE AGGREGATE, BE SO DESIGNATED DURING ANY TAX YEAR.
  (E)  DURING THE FIRST YEAR THAT AN ELIGIBLE TAXPAYER DESIGNATES MONEYS
FOR DEPOSIT INTO THE STUDY AND STAY PROGRAM FUND,  SUCH  TAXPAYER  SHALL
SUBMIT, TO THE DEPARTMENT, SUCH PROOF OF RECEIPT AND THE DATE OF RECEIPT
OF  A  BACHELOR'S DEGREE FROM AN INSTITUTION OF HIGHER EDUCATION LOCATED
IN THIS STATE, AS THE COMMISSIONER SHALL DESIGNATE.
  S 2. The state finance law is amended by adding a new  section  85  to
read as follows:
  S  85.  STUDY AND STAY PROGRAM FUND. 1. THERE IS HEREBY ESTABLISHED IN
THE JOINT CUSTODY OF THE STATE COMPTROLLER AND THE COMMISSIONER OF TAXA-
TION AND FINANCE A SPECIAL FUND TO BE  KNOWN  AS  THE  "STUDY  AND  STAY
PROGRAM FUND".
  2.  THE  COMPTROLLER  SHALL ESTABLISH A SEPARATE AND DISTINCT ACCOUNT,
WITHIN THE STUDY AND STAY PROGRAM FUND, FOR EACH ELIGIBLE  TAXPAYER  WHO
DESIGNATES  MONEYS  FOR  DEPOSIT  INTO  THE FUND PURSUANT TO SECTION SIX
HUNDRED EIGHT OF THE TAX LAW.
  3. THE FUND SHALL CONSIST OF ALL MONEYS DEPOSITED THEREIN PURSUANT  TO
SECTION SIX HUNDRED EIGHT OF THE TAX LAW.
  4.  MONEYS  IN  EACH  ACCOUNT OF THE STUDY AND STAY FUND SHALL BE KEPT
SEPARATE AND SHALL NOT BE COMMINGLED WITH OTHER MONEYS IN THE CUSTODY OF
THE STATE COMPTROLLER.
  5. THE MONEYS IN THE ACCOUNT OF AN ELIGIBLE  TAXPAYER  SHALL  BE  MADE
AVAILABLE,  WITHIN TEN DAYS OF SUBMISSION OF AN APPLICATION THEREFOR, TO
SUCH TAXPAYER SOLELY FOR THE PURPOSE OF THE PAYMENT OF THE DOWN  PAYMENT
FOR  HIS  OR HER FIRST PURCHASE OF RESIDENTIAL REAL PROPERTY OCCUPIED BY
SUCH TAXPAYER AS HIS OR HER  PRIMARY  RESIDENCE,  INCLUDING  A  MULTIPLE
DWELLING HAVING NOT MORE THAN TWO HOUSING UNITS. NO SUCH MONEYS SHALL BE
EXPENDED  IN  AN  AMOUNT  IN EXCESS OF SUCH DOWN PAYMENT, NOR SHALL SUCH
MONEYS BE EXPENDED FOR REAL PROPERTY USED IN A BUSINESS OR  TRADE,  USED
AS  A  VACATION  RESIDENCE  OR  USED AS AN INVESTMENT, EXCEPT A MULTIPLE
DWELLING HAVING NOT MORE THAN TWO HOUSING UNITS  IN  ONE  OF  WHICH  THE
ELIGIBLE TAXPAYER HAS HIS OR HER PRIMARY RESIDENCE.
  6.  EACH  ELIGIBLE  TAXPAYER  SHALL,  WITHIN  SIXTY DAYS OF RECEIPT OF
MONEYS IN HIS OR HER  ACCOUNT  PURSUANT  TO  SUBDIVISION  FIVE  OF  THIS
SECTION,  SUBMIT  A  SWORN  STATEMENT  TO  THE STATE COMPTROLLER AND THE
COMMISSIONER OF TAXATION AND FINANCE, IN SUCH FORM AND CONTENT AS  SHALL
BE  DETERMINED  BY  THE COMMISSIONER OF TAXATION AND FINANCE, CERTIFYING
THAT SUCH MONEYS EXPENDED AS REQUIRED PURSUANT TO SUCH  SUBDIVISION  AND
RETURNING  TO  THE  STATE  COMPTROLLER  ALL  MONEYS NOT SO EXPENDED. ALL
MONEYS NOT SO EXPENDED AND REPAID TO THE STATE COMPTROLLER SHALL CONSTI-

S. 6699                             3

TUTE TAX MONEYS PAYABLE TO  THE  DEPARTMENT  OF  TAXATION  AND  FINANCE,
PURSUANT TO ARTICLE TWENTY-TWO OF THE TAX LAW.
  7.  THE  FOLLOWING  MONEYS  IN AN ELIGIBLE TAXPAYER'S ACCOUNT SHALL BE
TRANSFERRED TO AND DEPOSITED INTO THE GENERAL FUND:
  (A) ANY MONEYS REMAINING IN THE  ACCOUNT  AFTER  DISBURSEMENT  TO  THE
ELIGIBLE TAXPAYER PURSUANT TO SUBDIVISION FIVE OF THIS SECTION;
  (B)  ANY  MONEYS  REMAINING IN THE ACCOUNT OF THE ELIGIBLE TAXPAYER IN
THE ELEVENTH TAX YEAR AFTER SUCH TAXPAYER RECEIVED HIS OR HER BACHELOR'S
DEGREE; AND
  (C) ANY MONEYS REMAINING IN THE ACCOUNT OF THE ELIGIBLE TAXPAYER  WHEN
HE OR SHE CEASES TO BE A RESIDENT OF THE STATE.
  8.  (A) AN ELIGIBLE TAXPAYER WHO MAKES A DOWN PAYMENT FOR THE PURCHASE
OF HIS OR HER PRIMARY RESIDENCE WITH MONEYS  FROM  HIS  OR  HER  ACCOUNT
WITHIN THE STUDY AND STAY PROGRAM FUND, SHALL BE LIABLE TO THE STATE FOR
A  PENALTY  IN  THE  FOLLOWING AMOUNTS WHEN SUCH TAXPAYER CEASES TO BE A
RESIDENT OF THIS STATE  WITHIN  THE  FOLLOWING  PERIODS  OF  TIME  AFTER
RECEIPT OF MONEYS FROM HIS OR HER ACCOUNT:
     (I) ONE YEAR                  ALL MONEYS RECEIVED FROM THE ACCOUNT;
     (II) TWO YEARS                EIGHTY PERCENT OF THE MONEYS RECEIVED
                                   FROM THE ACCOUNT;
     (III) THREE YEARS             SIXTY PERCENT OF THE MONEYS RECEIVED
                                   FROM THE ACCOUNT;
     (IV) FOUR YEARS               FORTY PERCENT OF THE MONEYS RECEIVED
                                   FROM THE ACCOUNT;
     (V) FIVE YEARS                TWENTY PERCENT OF THE MONEYS RECEIVED
                                   FROM THE ACCOUNT; AND
     (VI) MORE THAN FIVE YEARS     NO PENALTY.
  (B)  PENALTIES  IMPOSED  PURSUANT TO THIS SUBDIVISION SHALL CONSTITUTE
PERSONAL INCOME TAX PAYABLE PURSUANT TO ARTICLE TWENTY-TWO  OF  THE  TAX
LAW.
  (C)  THE PENALTIES IMPOSED BY PARAGRAPH (A) OF THIS SUBDIVISION MAY BE
WAIVED, IN THE DISCRETION OF THE COMMISSIONER OF TAXATION  AND  FINANCE,
UPON  DEMONSTRATION  THAT  THE ELIGIBLE TAXPAYER CEASED RESIDENCY IN THE
STATE DUE TO:
  (I) AN EMPLOYMENT RELOCATION OUTSIDE OF THE STATE WHICH REQUIRED RESI-
DENCY IN ANOTHER STATE; OR
  (II) THE SEVERE FINANCIAL HARDSHIP OF THE ELIGIBLE TAXPAYER OR HIS  OR
HER DEPENDENT.
  S 3. This act shall take effect immediately.

Comments

Open Legislation comments facilitate discussion of New York State legislation. All comments are subject to moderation. Comments deemed off-topic, commercial, campaign-related, self-promotional; or that contain profanity or hate speech; or that link to sites outside of the nysenate.gov domain are not permitted, and will not be published. Comment moderation is generally performed Monday through Friday.

By contributing or voting you agree to the Terms of Participation and verify you are over 13.