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This entry was published on 2022-04-29
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SECTION 25-C
Power to administer the empire state apprenticeship tax credit program
Labor (LAB) CHAPTER 31, ARTICLE 2
§ 25-c. Power to administer the empire state apprenticeship tax credit
program. (a) The commissioner is authorized to establish and administer
the empire state apprenticeship tax credit program to provide tax
incentives to certified employers for employing qualified apprentices
pursuant to an apprenticeship agreement registered with the department
pursuant to paragraph (d) of subdivision one of section eight hundred
eleven of this chapter. The commissioner is authorized to allocate up to
ten million dollars of tax credits annually, beginning in two thousand
eighteen and ending before two thousand twenty-eight. Any unused annual
allocation of the credit shall be made available in each of the
subsequent years before two thousand twenty-eight.

(b) Definitions. (1) The term "qualified apprenticeship agreement"
means an apprenticeship agreement as defined by section eight hundred
sixteen of this chapter that has been registered with, and approved by,
the commissioner, for a trade other than a construction trade.

(2) The term "qualified employer" means an employer that has or
participates in a commissioner approved registered apprenticeship
program.

(3) The term "construction" means constructing, reconstructing,
altering, maintaining, moving, rehabilitating, repairing, renovating,
fabricating, servicing, or demolition of any building, structure, or
improvement, or component, or relating to the excavation of or other
development or improvement to land.

(4) The term "participating employer" means a qualified employer that
has applied to participate in the empire state apprenticeship tax credit
program and received a preliminary certificate of tax credit from the
commissioner. The preliminary certificate shall state the maximum amount
of the tax credit that the employer may be able to claim if the
applicant becomes a "certified employer."

(5) The term "certified employer" means a qualified employer that has
received a final certificate of eligibility from the commissioner after
the commissioner has determined that the qualified employer has
fulfilled all the requisite eligibility criteria to participate in the
empire state apprenticeship tax credit program established in this
section. The final certificate of eligibility shall state the actual
amount of tax credit that a certified employer is entitled to claim and
the allocation year of the credit.

(6) The term "qualified apprentice" means an individual employed by a
participating employer in a full time position for at least six months
of a calendar year pursuant to a qualified apprenticeship agreement with
a qualified employer. No individual employed by a qualified employer
shall be deemed a qualified apprentice if such individual has not
completed their apprenticeship training program within one year of their
expected date of completion of their program.

(7) The term "disadvantaged youth" means an individual:

(i) who is between the ages of sixteen and twenty-four when the youth
begins the apprenticeship; and

(ii) who is low-income or at-risk, as those terms are defined by the
commissioner.

(8) The term "mentor" means an individual who provides instruction,
guidance, and support to the apprentice on a regular basis throughout
the apprentice's completion of the apprenticeship as the apprentice
seeks employment in the field or industry of the apprenticeship. The
goal of the mentor is to help train the apprentice in his or her trade
and to help the apprentice successfully complete the apprenticeship and
to secure and retain employment.

(c)(1) A certified employer shall be entitled to a tax credit against
income or franchise tax for each qualified apprentice. The base credit
allowed under this program shall be computed as follows:

(A) (1) two thousand dollars for each first year apprentice; (2) three
thousand dollars for each second year apprentice;(3) four thousand
dollars for each third year apprentice; (4) five thousand dollars for
each fourth year apprentice; and (5) six thousand dollars for each fifth
year apprentice. The apprentice's status as a first, second, third,
fourth or fifth year apprentice will be determined on the last day of
the calendar year, or if the apprentice is no longer employed by the
participating employer on the last day of the calendar year, on the last
day of the apprentice's employment with the participating employer; or

(B) in lieu of the credit specified in subparagraph (A) of this
paragraph, for each qualified apprentice who is considered a
disadvantaged youth for each tax year: (1) five thousand dollars for
each first year apprentice; (2) six thousand dollars for each second
year apprentice; and (3) seven thousand dollars for each third, fourth,
or fifth year apprentice. The apprentice's status as a first, second,
third, fourth or fifth year apprentice will be determined on the last
day of the calendar year, or if the apprentice is no longer employed by
the participating employer on the last day of the calendar year, on the
last day of the apprentice's employment with the participating employer.
If a disadvantaged youth begins an apprenticeship before the age of
twenty-five, a certified employer shall be eligible to continue to
receive the tax credit for such youth under this subparagraph until that
apprentice completes the apprenticeship.

(2) If an apprentice has been trained in his or her trade by a mentor
for the entirety of the calendar year, the base credit amounts described
in paragraph one of this subdivision shall be increased by five hundred
dollars.

(3) The certified employer shall not be allowed a tax credit under
this program for any apprentice, if that apprentice is the basis for any
other state tax credit.

(d) Application and approval process. (1) To participate in the
program established under this section, a qualified employer must submit
to the commissioner an application in a form prescribed by the
commissioner. As part of such application, a qualified employer must:

(A) Agree to allow the department of taxation and finance to share its
tax information with the department. 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.

(B) Allow the department and its agents access to any and all books
and records the department may require to monitor compliance.

(2) After reviewing a qualified employer's completed application and
determining that the qualified employer will meet the eligibility
conditions set forth under this section and any applicable regulations
promulgated by the commissioner, the commissioner may admit the
applicant into the program as a participating employer and provide the
applicant with a preliminary certificate of eligibility establishing the
qualified employer as a participating employer and stating the maximum
amount of credit for which the applicant may be eligible.

(3) To receive a final certificate of tax credit, the participating
employer must annually submit a final report to the commissioner, in a
form prescribed by the commissioner. The report must demonstrate that
the applicant has satisfied all eligibility requirements and provided
all the information necessary for the commissioner to compute an actual
amount of credit allowed for that calendar year, notwithstanding the
fact that a participating employer's taxable year may be a fiscal year,
as defined in subdivision ten of section two hundred eight of the tax
law.

(4) After reviewing the final report and finding it sufficient, the
commissioner shall certify the participating employer as a certified
employer and issue a final certificate of tax credit. Such certificate
shall include, but not be limited to, the following information:

(A) The name and employer identification number of the certified
employer;

(B) The actual amount of credit to which the certified employer is
entitled for that calendar year, which actual amount cannot exceed the
amount of credit listed on the preliminary certificate but may be less
than such amount;

(C) The allocation year of the credit.

(5) If a certified employer's taxable year is a fiscal year, it shall
be entitled to claim the credit on the return for the fiscal year that
includes the last day of the calendar year covered by the final
certificate of tax credit.

(e) The commissioner shall establish guidelines and criteria that
specify requirements for qualified employers to participate in the
program including criteria for certifying qualified apprentices. Any
regulations that the commissioner determines are necessary and are
consistent with the purpose of this article may be adopted on an
emergency basis notwithstanding any provisions to the contrary in the
state administrative procedure act. The commissioner may give preference
to qualified employers that hire and train disadvantaged youth through
qualified apprenticeship agreements, and qualified employers that are
engaged in demand occupations or industries, or in regional growth
sectors, including those identified by the department, such as clean
energy, health care, technology, including software engineering and web
development, advanced manufacturing and conservation. In addition, the
commissioner may give preference to employers that employ apprentices in
newly established apprenticeship programs. The commissioner also may
take the following factors into consideration when evaluating whether to
approve an application in a year subsequent to the year in which a
qualified employer was determined to be a certified employer:

(1) the length of the qualified apprenticeship agreement the employer
has entered into;

(2) how many apprentices have graduated from the apprenticeship
program to which the qualified apprentice employed by the employer
belongs;

(3) how many apprentices in the apprenticeship program the qualified
employer has hired; and

(4) any other factors the commissioner deems relevant.

(f) The commissioner shall annually publish a report. Such report must
contain the names and addresses of any certified employer issued a final
certificate of eligibility under this section, the work location of each
apprentice generating credit, the amount of empire state apprenticeship
tax credit allowed to the certified employer as specified on such final
certificate of eligibility, and the number of each of the first year
apprentices, second year apprentices, third year apprentices, fourth
year apprentices, and fifth year apprentices, and how many of each of
those types are considered disadvantaged youth. The commissioner shall
include in such report the relevant industries of certified employers
and recommendations for legislative or other action to further the
intent and purpose of the empire state apprenticeship tax credit
program.

(g) The commissioner shall promote, publish and disseminate
information concerning the empire state apprenticeship tax credit and
other available funding, particularly targeting industries and fields of
business not currently taking advantage of apprenticeships.