S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   5679
 
                        2017-2018 Regular Sessions
 
                           I N  A S S E M B L Y
 
                             February 14, 2017
                                ___________
 
 Introduced  by M. of A. KOLB, OAKS, WALTER, PALMESANO, MONTESANO, LOPEZ,
   GOODELL, RAIA, HAWLEY, BARCLAY, STEC -- Multi-Sponsored by -- M. of A.
   BUTLER, McLAUGHLIN -- read once  and  referred  to  the  Committee  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 23 to read as follows:
                                 ARTICLE 23
                            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.
   § 450. SHORT TITLE. THIS ARTICLE SHALL BE KNOWN AND MAY  BE  CITED  AS
 THE "BIZBOOM PROGRAM ACT".
   § 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.
              

                                                            LBD08030-01-7

 A. 5679                             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.
   §  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.
   § 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.
   § 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. 5679                             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.
   § 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.
   §  2.  The  tax  law  is amended by adding a new section 43 to read as
 follows:
   § 43. 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. 5679                             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-TWO 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.
   §  3.  The tax law is amended by adding a new section 207-c to read as
 follows:
   § 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 FORTY-THREE OF THIS CHAPTER.
   §  4. Section 210-B of the tax law is amended by adding a new subdivi-
 sion 49 to read as follows:
   49. BIZBOOM PROGRAM EXEMPTION. (A) ALLOWANCE OF EXEMPTION. A  TAXPAYER
 WILL  BE  ALLOWED  AN  EXEMPTION,  TO BE COMPUTED AS PROVIDED IN SECTION
 FORTY-THREE 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 AMOUNT PRESCRIBED IN PARAGRAPH (D) OF SUBDIVISION  ONE  OF
 SECTION  TWO  HUNDRED  TEN  OF  THIS  ARTICLE. 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.
   § 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-TWO  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 FORTY-THREE OF
 THIS CHAPTER.
   § 6. Section 606 of the tax law is amended by adding a new  subsection
 (ccc) to read as follows:
   (CCC)  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.
   § 7. Subsection (c) of section 612 of the tax law is amended by adding
 a new paragraph 42 to read as follows:
   (42) 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

 A. 5679                             5
 
 SUBTRACTED FROM FEDERALLY ADJUSTED GROSS INCOME IN THE FIRST YEAR, FIFTY
 PERCENT IN THE SECOND YEAR, AND TWENTY-FIVE PERCENT IN THE THIRD YEAR.
   § 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.
   § 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.
   § 10. This act shall take effect January 1, 2018.