Establishes the incentive evaluation act; creates the incentive evaluation commission to at least once every four years evaluate each incentive provided by the state and report to the governor and the legislature on their effectiveness and provide recommendations relating thereto.
STATE OF NEW YORK
________________________________________________________________________
10900
IN ASSEMBLY
April 8, 2026
___________
Introduced by M. of A. BORES -- read once and referred to the Committee
on Economic Development
AN ACT to amend the economic development law, in relation to establish-
ing the incentive evaluation act
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. The economic development law is amended by adding a new
2 article 29 to read as follows:
3 ARTICLE 29
4 INCENTIVE EVALUATION ACT
5 Section 510. Short title.
6 511. Definitions.
7 512. Incentive evaluation commission.
8 513. Periodic evaluations.
9 514. Evaluation process.
10 § 510. Short title. This article shall be known and may be cited as
11 the "incentive evaluation act".
12 § 511. Definitions. As used in this article, the following terms shall
13 have the following meanings:
14 1. "business entity" shall mean any person, corporation, partnership,
15 sole proprietor, limited partnership, association or any other business
16 entity.
17 2. "commission" shall mean the incentive evaluation commission estab-
18 lished under this article.
19 3. "incentive" shall mean a tax credit, tax exemption, tax deduction,
20 tax expenditure, rebate, grant, or loan that is intended to encourage
21 businesses to locate, expand, invest, or remain in New York, or to hire
22 or retain employees in New York.
23 4. "substantial interest" shall mean the ownership, directly or indi-
24 rectly, of more than fifty percent of the equity interest with voting
25 rights of a business entity.
26 § 512. Incentive evaluation commission. 1. There is hereby established
27 the incentive evaluation commission consisting of:
28 (a) A certified public accountant appointed by the state comptroller;
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD09441-04-6
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1 (b) A chartered financial analyst appointed by the speaker of the
2 assembly;
3 (c) An auditor who is employed as an internal auditor by a company or
4 who is employed by a private auditing firm appointed by the state comp-
5 troller;
6 (d) An economist from a New York college or university appointed by
7 the temporary president of the senate;
8 (e) A lay person who is not an elected official appointed by the
9 governor;
10 (f) The commissioner of the department of taxation and finance or
11 their designee who is also a member of the department of taxation and
12 finance, which shall be an ex officio and nonvoting position;
13 (g) The director of the authorities budget office or their designee
14 who is an employee of the authorities budget office which shall be an ex
15 officio and nonvoting position; and
16 (h) The commissioner or their designee who is an employee of empire
17 state development which shall be an ex officio and nonvoting position.
18 2. Initial appointments to the commission of voting members shall
19 occur within ninety days of the effective date of this article and such
20 members shall have their term expire on the thirty-first of December
21 next succeeding the ninetieth day after the effective date of this arti-
22 cle. Thereafter, such members shall be appointed for terms of four years
23 beginning on January first. Any vacancy shall be filled by the appoint-
24 ing authority for the remainder of the unexpired term.
25 3. No person shall serve on the commission or be appointed to the
26 commission who is employed by a business entity that receives any incen-
27 tive or who holds a substantial interest in ownership in a business
28 entity that receives any incentive.
29 4. No person shall be appointed to the commission who at the time of
30 their appointment is an elected official. Any person who is appointed to
31 the commission who subsequently becomes an elected official during their
32 term on the commission shall be required to vacate their position on the
33 commission.
34 5. The office of general services shall provide staff and administra-
35 tive support to the commission. The department and the department of
36 taxation and finance shall assist the office of general services as
37 needed in providing staff and administrative support to the commission.
38 § 513. Periodic evaluations. 1. (a) On or before the thirty-first of
39 December next succeeding the ninetieth day after the effective date of
40 this article and every four years thereafter, the commission shall
41 develop a four-year schedule for evaluating incentives. The development
42 of the schedule for evaluating the incentives shall take into consider-
43 ation fiscal impacts to revenues of this state, including but not limit-
44 ed to the general fund, the opportunity to group incentives with similar
45 goals and objectives for evaluation, and the ability to obtain suffi-
46 cient data related to the incentives for evaluation. Each schedule shall
47 include a list of all incentives in the state, including any it exempts
48 from evaluation. In determining whether a program is an incentive, the
49 commission may consider legislative intent and may also consider whether
50 the program is promoted as an incentive by any state agency. For each
51 incentive listed in the schedule, the commission shall attempt to iden-
52 tify the goal or goals of the incentive.
53 (b) Upon approval of the schedule, the commission shall provide the
54 schedule to the governor, temporary president of the senate, and speaker
55 of the assembly.
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1 2. For the four calendar years following the approval of a schedule
2 under subdivision one of this section, the commission shall ensure that
3 each incentive in such schedule is evaluated within the four-year evalu-
4 ation period unless the commission determines that the incentive is
5 exempt from evaluation. The commission may exempt from evaluation any
6 incentive that it concludes has a minimal fiscal impact. The commission
7 shall determine a specific threshold amount which shall be considered as
8 a minimal fiscal impact for the current evaluation cycle. The commission
9 may also conduct an expedited evaluation for any incentive that has been
10 evaluated at least twice within the previous eight years and has not had
11 a material change to the program since its prior evaluation. The expe-
12 dited evaluation will update the prior evaluation's financial and
13 economic impacts, findings, and recommendations.
14 § 514. Evaluation process. 1. The commission may contract with a
15 private company, nonprofit, or academic institution for professional
16 services to assist with evaluation of each incentive. The commission
17 shall develop requirements for such professional services necessary to
18 complete incentive evaluations pursuant to this article. Such require-
19 ments shall include, but not be limited to, the contractor provide at
20 least one draft report for each incentive prior to the issuance of the
21 final report; provided, the contractor may determine the timing and
22 frequency of draft reports based on the availability of information and
23 the potential for draft reports to assist the commission in making a
24 final recommendation. The cost of such contract shall be paid by the
25 department. No recipient or potential recipient of an incentive or
26 representative of a recipient or potential recipient shall contact the
27 entity or individual with whom the commission contracts pursuant to this
28 subdivision unless the entity or individual specifically requests infor-
29 mation or documentation for purposes of the incentive evaluation proc-
30 ess; provided, this shall not be construed to prevent participation in a
31 public hearing conducted pursuant to subdivision two of this section.
32 2. For each year in which incentives have been scheduled to be evalu-
33 ated under this article:
34 (a) By October first of each such year, the commission or the commis-
35 sion's chosen contractor shall have evaluated each incentive scheduled
36 for review that year. The commission or the commission's chosen contrac-
37 tor shall conduct each incentive evaluation in consultation with the
38 department using criteria developed pursuant to subdivision four of this
39 section.
40 (b) Between October first and November thirtieth of each such year,
41 the commission shall hold at least one public meeting to review, allow
42 for public comment, and vote to approve, disapprove, or modify each
43 incentive evaluation conducted that year.
44 (c) By December fifteenth of each such year, the commission shall
45 issue an annual written report which shall provide: (i) the results of
46 each incentive evaluation; (ii) a review of prior incentive evaluation
47 recommendations by the commission and changes to statute or incentive
48 administration related to such recommendations; and (iii) if the commis-
49 sion votes to modify an incentive evaluation as provided in this subdi-
50 vision, such modification and the original evaluation shall be docu-
51 mented. The report shall be made publicly available on the department's
52 website and the commission's website and shall be submitted to the
53 governor, temporary president of the senate, and the speaker of the
54 assembly.
55 3. Each evaluation shall include the following:
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1 (a) An estimate of the economic and fiscal impact of the incentive.
2 This estimate shall include, but not be limited to:
3 (i) the extent to which the incentive changes business behavior.
4 (ii) the results of the incentive for the economy of New York as a
5 whole. This consideration includes both positive direct and indirect
6 impacts and any negative effects on other New York businesses.
7 (iii) a comparison to the results of other incentives or other econom-
8 ic development strategies with similar goals.
9 (b) An assessment of whether adequate protections are in place to
10 ensure the fiscal impact of the incentive does not increase substantial-
11 ly beyond the state's expectations in future years.
12 (c) An assessment of whether the incentive is being administered
13 effectively.
14 (d) An assessment of whether the incentive is achieving its goals.
15 (e) Recommendations for how the state can most effectively achieve the
16 incentive's goals, including recommendations on whether the incentive
17 should be retained, reconfigured, or repealed.
18 (f) Recommendations for any changes to state policy, rules, or stat-
19 utes that would allow the incentive to be more easily or conclusively
20 evaluated in the future. These recommendations may include changes to
21 collection, reporting, and sharing of data, and revisions or clarifica-
22 tions to the goal of the incentive.
23 4. Evaluation criteria shall be developed for each incentive evaluated
24 by the commission. Each incentive shall be evaluated using criteria
25 specific to the individual incentive.
26 5. The commission and any of its contractors, unless prohibited by
27 state or federal law, may request and shall receive in a timely manner
28 from any department, division, board, bureau, commission, agency or
29 other political subdivision of the state, such information and assist-
30 ance as shall enable it to properly carry out its powers and duties
31 pursuant to this article.
32 § 2. This act shall take effect immediately.
