The Senate Democratic Majority passed legislation creating the Excelsior Jobs Program, a targeted economic development initiative that create jobs, attracts new businesses and encourages investment.
Totaling a $1.25 billion investment over 10 years, Excelsior provides tax credits to strategic industries, implements stringent accountability standards, and caps program spending to ensure the wisest investment of taxpayer dollars.
Though the Empire Zone program will no longer accept new participants after June 30, 2010, benefits will stay in effect for those already within the program, as long as they remain in good standing. Businesses will be able to start enrolling in the Excelsior program on July 1; companies can be enrolled in only one of these two benefits programs.
“We are building the foundation for smart and sustainable economic growth that will create the lasting jobs we need to get New Yorkers working again. The Excelsior program employs greater accountability and targeted investment to ensure businesses who receive benefits create jobs and public funds are spent wisely,” said Senate Majority Conference Leader John L. Sampson.
“For Upstate New York, our priorities are as much about business retention and expansion as they are about business attraction,” said Senator William T. Stachowski (D-Lake View), Chair of the Senate Committee on Commerce, Economic Development and Small Business. “The Excelsior Jobs Program is a good start to helping us reach these goals as we work to remodel the previous Empire Zone program. We will continue to develop incentives to welcome new investment and jobs to the upstate region. We will continue to do everything we can to strengthen the upstate economy and encourage real job growth. This program lays the foundation for additional strategies that will help to keep improving our economy and the quality of life in upstate New York.”
Senator Carl Kruger (D-Brooklyn), Chair of the Senate Finance Committee said, “The Excelsior Jobs Creation Program seeks to accomplish the lofty and extremely important goal of attracting new jobs to New York State, thereby correcting a shortfall of the previous program. We look forward to its implementation and the infusion of energy it promises to bring.”
Main features of the Excelsior Jobs program include:
- Three new tax credits that spur job creation and investments are available for businesses regardless of where they are located; the fourth credit, to provide property tax relief, is targeted to businesses located in 48 economically distressed communities.
- $62.5 million to target businesses that make a substantial investment with a goal of retaining jobs which might otherwise disappear.
- Improved transparency and accountability to make sure benefits are going to the firms that actually create required jobs or make the required investment. The Department of Economic Development must issue a quarterly report to the Legislature on the results of the program.
The legislation is targeted towards job creation and investment incentives to firms in high-tech, agri-business, financial services, and manufacturing industries. The Majority worked to include tax credits for firms in those industries that create and maintain new jobs, or make a substantial new investment in New York for five years (which, unlike in the past, are refundable). Those tax credits include:
- The Excelsior New Jobs Tax Credit of between $2,500 and $5,000 per new job to cover a portion of the associated payroll cost;
- The Excelsior Investment Tax Credit valued at two-percent of total qualified investments;
- The Excelsior Research and Development Tax Credit providing a ten-percent credit for new investments based on the Federal Research and Development credit; and
- The Excelsior Real Property Tax Credit valued at fifty-percent in the first year, decreasing to ten percent in the fifth year for regionally significant projects and/or businesses in targeted industries which locate to distressed areas.
Aid to Economically-Distressed Areas
A number of provisions help aid normally overlooked areas of the state. The inclusion of a real property tax credit gives firms incentive to locate in the state’s hardest-hit economic areas. Since many of these distressed communities also have high property taxes, this credit will allow them to give these areas another look.
The $62.5 million carve-out for retention projects helps firms in Upstate New York compete more successful in the innovation economy. Many of those firms may not be able to meet the set job creation targets, but are willing to invest in equipment and infrastructure.