Add Art 15 SS270 - 273, Ec Dev L; add Art 24 SS851 - 853, amd SS210 & 606, Tax L
Establishes the manufacturing preservation and enhancement act to foster economic growth and job creation; provides manufacturing enhancement incentive income and real property tax credits.
STATE OF NEW YORK
________________________________________________________________________
5575
2013-2014 Regular Sessions
IN ASSEMBLY
March 1, 2013
___________
Introduced by M. of A. KOLB, TEDISCO, BUTLER, CORWIN -- Multi-Sponsored
by -- M. of A. BARCLAY, CROUCH, DUPREY, FINCH, FITZPATRICK, GIGLIO,
GOODELL, HAWLEY, JORDAN, P. LOPEZ, McDONOUGH, McKEVITT, OAKS, RA,
RABBITT, RAIA, REILICH, SALADINO, TENNEY, THIELE -- read once and
referred to the Committee on Economic Development
AN ACT to amend the economic development law, in relation to establish-
ing an incentive program for manufacturers that maintain or increase
employment, and to amend the tax law, in relation to establishing tax
credit incentives for manufacturing firms enrolled in the program
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Short title. This act shall be known and may be cited as
2 the "manufacturing preservation and enhancement act".
3 § 2. Legislative findings and intent. The legislature finds and deter-
4 mines that historically, manufacturing firms have helped to build our
5 state. Today, manufacturing jobs are an essential part of the state's
6 economy. Accordingly, the state should offer programs that foster growth
7 in this important sector of the state economy. The purpose of this
8 legislation is to establish a tax incentive program that would provide
9 tax credits to manufacturing firms that create new jobs in the manufac-
10 turing sector over a specified period of time.
11 § 3. The economic development law is amended by adding a new article
12 15 to read as follows:
13 ARTICLE 15
14 MANUFACTURING PRESERVATION AND ENHANCEMENT ACT
15 Section 270. Definitions.
16 271. Manufacturing preservation and enhancement program.
17 272. Special provisions relating to certified manufacturers.
18 273. Reporting.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD08255-01-3
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1 § 270. Definitions. As used in this article, the following words and
2 terms shall have the following meanings unless the content shall indi-
3 cate another or different meaning or intent:
4 1. "Program" shall mean the manufacturing preservation and enhancement
5 program established pursuant to this article.
6 2. "Manufacturing firm" shall mean an enterprise, including corporate
7 entities, partnerships and sole proprietors, engaged in the business of
8 production of goods and products from raw materials.
9 3. "Benchmark" shall mean a specific number of eligible new jobs
10 created in the state pursuant to the program.
11 4. "MEI" shall mean the manufacturing enhancement incentive program.
12 § 271. Manufacturing preservation and enhancement program. 1. There
13 is hereby created a manufacturing preservation and enhancement program
14 within the department to provide technical and financial assistance in
15 the form of tax incentives to manufacturing firms that meet specified
16 benchmarks in job creation as established by the commissioner.
17 2. The commissioner shall determine eligibility requirements for
18 participation in the program, provided, however, that such requirements
19 shall include the following:
20 (a) An applicant to the program may not participate in the program if
21 designated as a certified business located in an empire zone created
22 pursuant to article eighteen-B of the general municipal law; and
23 (b) An applicant that has previously participated in the program may
24 not reapply for participation in the program unless it can document that
25 at the time of its reapplication for participation, it has maintained a
26 level of employment at least as great as the highest level required
27 during its previous participation in the program.
28 3. Applications for participation in the MEI shall be submitted by
29 each manufacturing firm seeking to participate in the program, and shall
30 be in the form and contain such information, exhibits and supporting
31 data as the commissioner may prescribe. No applications for partic-
32 ipation shall be accepted after December thirty-first, two thousand
33 twenty-one.
34 4. Manufacturing firms interested in participating in the MEI shall
35 submit an application to the program. The commissioner shall review all
36 applications for participation in the program for eligibility and shall
37 register eligible applicants. The commissioner shall provide each regis-
38 tered applicant with benchmarks in job creation that must be achieved by
39 the registered applicant over the following one year. Such benchmarks
40 shall be consistent with regulations to be prescribed by the commission-
41 er. Annually, each registered applicant shall submit to the commissioner
42 a registration statement, together with such information, exhibits and
43 supporting data as the commissioner may require. Upon submission of the
44 second annual registration statement, the commissioner shall review the
45 registered applicant's file for eligibility for the tax incentives. If
46 the registered applicant has met the required benchmarks in job
47 creation, the commissioner shall provide a certificate, valid for the
48 succeeding five tax years, certifying that the registered applicant is
49 eligible for tax credits pursuant to this article. The MEI certificate
50 shall include a description of the property eligible for the property
51 tax benefit and shall specify the employment level and total amount of
52 employee gross salary eligible for the wage credit.
53 § 272. Special provisions relating to certified manufacturers. During
54 the five-year certification period, certified manufacturing firms shall
55 be eligible to receive the following tax credits:
A. 5575 3
1 1. An MEI property tax credit, which shall be computed pursuant to
2 section eight hundred fifty-one of the tax law;
3 2. An MEI wage tax credit, which shall be computed pursuant to section
4 eight hundred fifty-two of the tax law; and
5 3. An MEI energy tax credit, which shall be computed pursuant to
6 section eight hundred fifty-three of the tax law.
7 § 273. Reporting. The commissioner shall, on or before September
8 first, two thousand fifteen, and annually thereafter, submit a report to
9 the governor, the temporary president of the senate, the speaker of the
10 assembly, the minority leader of the senate and the minority leader of
11 the assembly on the operation and accomplishments of the program
12 provided for pursuant to this article.
13 § 4. The tax law is amended by adding a new article 24 to read as
14 follows:
15 ARTICLE 24
16 MANUFACTURING PRESERVATION AND ENHANCEMENT ACT
17 Section 851. MEI property tax credit.
18 852. MEI wage tax credit.
19 853. MEI energy tax credit.
20 § 851. MEI property tax credit. (a) Allowance of credit. A taxpayer
21 receiving an MEI certificate issued pursuant to article fifteen of the
22 economic development law, and that or who is subject to property taxes
23 under article nine-A or article twenty-two of this chapter, shall be
24 allowed a credit against the property taxes assessed under article
25 nine-A or article twenty-two of this chapter during the tax years that
26 the certificate is valid, provided, and to the extent that, the taxes
27 assessed constitute eligible real property taxes as defined in
28 subsection (b) of this section. The credit shall be computed pursuant to
29 the provisions of subsection (c) of this section.
30 (b) Definition. The term "eligible real property taxes" shall mean tax
31 imposed on real property which has been certified as MEI eligible prop-
32 erty pursuant to article fifteen of the economic development law. In
33 addition, the term "eligible real property taxes" includes payments in
34 lieu of taxes made by the taxpayer to the state, a municipal corporation
35 or a public benefit corporation pursuant to a written agreement entered
36 into by the taxpayer and the state, municipal corporation or public
37 benefit corporation.
38 (c) Computation of property tax credit. The property tax credit
39 described in this section shall be a flat ten percent of the property
40 tax assessed.
41 § 852. MEI wage tax credit. (a) Allowance of credit. A taxpayer
42 receiving an MEI certificate that has been issued pursuant to article
43 fifteen of the economic development law, and that or who is subject to
44 taxes under article nine-A or article twenty-two of this chapter, shall
45 be allowed a credit against the taxes assessed under article nine-A or
46 article twenty-two of this chapter during the tax years that the certif-
47 icate is valid. The credit shall be computed pursuant to the provisions
48 of subsection (c) of this section.
49 (b) Definitions. The term "eligible wages" shall mean the total amount
50 of employee gross salary eligible for the wage tax credit, as such
51 amount is specified in the MEI certificate issued pursuant to article
52 fifteen of the economic development law.
53 (c) Computation of wage tax credit. (1) During the first tax year of
54 the five-year period for which a valid MEI certificate has been issued
55 pursuant to article fifteen of the economic development law, provided
56 the taxpayer has maintained the employment and eligible wage require-
A. 5575 4
1 ments specified by the MEI as defined in article fifteen of the economic
2 development law, the taxpayer shall be allowed a credit of one and one-
3 half percent of the total amount of the eligible wages actually paid by
4 the taxpayer. If the taxpayer increases employment during this tax year,
5 and exceeds the level of employment required by the MEI as defined in
6 article fifteen of the economic development law, hiring and maintaining
7 additional employees and paying additional wages over and above the
8 eligible wages amount, the taxpayer shall be allowed an additional cred-
9 it of two and one-half percent of the total amount by which the wages
10 actually paid as a result of the increased level of employment exceed
11 the eligible wages.
12 (2) During the second tax year of the five-year period for which a
13 valid MEI certificate has been issued pursuant to article fifteen of the
14 economic development law, provided the taxpayer has maintained the
15 employment and eligible wage requirements specified by the MEI as
16 defined in article fifteen of the economic development law, the taxpayer
17 shall be allowed a credit of one and one-half percent of the total
18 amount of the eligible wages actually paid by the taxpayer; however, if
19 the taxpayer increased employment in the preceding tax year and claimed
20 the two and one-half percent credit for employment and payment of wages
21 in excess of the MEI requirements pursuant to article fifteen of the
22 economic development law, the taxpayer shall be allowed a credit of one
23 and one-half percent of the total amount of the eligible wages actually
24 paid by the taxpayer during the preceding tax year, provided the taxpay-
25 er has maintained the increased employment and salary levels. If the
26 taxpayer again increases employment, hiring and maintaining additional
27 employees and paying additional wages over and above the previous tax
28 year's amount, the taxpayer shall be allowed an additional credit of two
29 and one-half percent of the total amount by which the wages actually
30 paid as a result of the increased level of employment exceed the wages
31 subject to the one and one-half percent credit.
32 § 853. MEI energy tax credit. (a) Allowance of credit. A taxpayer
33 receiving an MEI certificate has been issued pursuant to article fifteen
34 of the economic development law, and that or who is subject to taxes
35 under article nine-A or article twenty-two of this chapter, shall be
36 allowed a credit against the taxes assessed under article nine-A or
37 article twenty-two of this chapter during the tax years that the certif-
38 icate is valid. The credit shall be computed pursuant to the provisions
39 of subsection (c) of this section.
40 (b) Definition. The term "eligible energy costs" shall mean the
41 amounts paid by the taxpayer for electricity, natural gas, or any other
42 energy product or service which the taxpayer has used in the operation
43 of a MEI certified manufacturing firm facility pursuant to article
44 fifteen of the economic development law.
45 (c) Computation of energy credit. (1) If the taxpayer has paid eligi-
46 ble energy costs during the first tax year of the five-year period for
47 which a valid MEI certificate has been issued pursuant to article
48 fifteen of the economic development law, provided the taxpayer has main-
49 tained the employment and eligible wages requirements specified by the
50 MEI as defined in article fifteen of the economic development law, the
51 taxpayer shall be allowed an energy credit of twenty-five dollars per
52 employee required by the MEI as defined in article fifteen of the
53 economic development law. If the taxpayer increases employment during
54 this tax year, and exceeds the level of employment required by the MEI
55 as defined in article fifteen of the economic development law, hiring
56 and maintaining additional employees and paying additional wages over
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1 and above the eligible wages amount, the taxpayer shall be allowed an
2 additional energy credit of fifty dollars per each additional employee.
3 The energy tax credit shall not exceed the amount of eligible energy
4 costs actually paid by the taxpayer.
5 (2) If the taxpayer has paid eligible energy costs during the second
6 tax year of the five-year period for which a valid MEI certificate has
7 been issued pursuant to article fifteen of the economic development law,
8 provided the taxpayer has maintained the employment and eligible wage
9 requirements specified by the MEI as defined in article fifteen of the
10 economic development law, the taxpayer shall be allowed an energy credit
11 of twenty-five dollars per employee required by the MEI as defined in
12 article fifteen of the economic development law; however, if the taxpay-
13 er increased employment during the preceding tax year and claimed the
14 additional energy tax credit of fifty dollars per additional employee,
15 the taxpayer shall be allowed a credit of twenty-five dollars per
16 employee up to the number of employees claimed in the previous tax year,
17 provided the taxpayer has maintained the increased employment and wage
18 levels. If the taxpayer again increases employment, hiring additional
19 employees and paying additional wages over and above the previous tax
20 year's amounts, the taxpayer shall be allowed an additional credit of
21 fifty dollars for each additional employee hired during the second year.
22 The energy tax credit shall not exceed the amount of eligible energy
23 costs actually paid by the taxpayer.
24 § 5. Section 210 of the tax law is amended by adding three new subdi-
25 visions 46, 47 and 48 to read as follows:
26 46. MEI property tax credit. (a) Allowance of credit. A taxpayer shall
27 be allowed a credit, to be computed as provided in section eight hundred
28 fifty-one of this chapter, against the tax imposed by this article.
29 (b) Carryovers. The credit allowed under this subdivision for any
30 taxable year shall not reduce the tax due for such year to less than the
31 higher of the amounts prescribed in paragraphs (c) and (d) of subdivi-
32 sion one of this section; provided, however, if the amount of this cred-
33 it allowable under this section for any taxable year reduces tax to such
34 amount, any amount of the credit not deductible in such taxable year may
35 be carried over to the following year or years and may be deducted from
36 the taxpayer's tax for such year or years.
37 47. MEI wage tax credit. (a) Allowance of credit. A taxpayer shall be
38 allowed a credit against the tax imposed by this article, to be computed
39 as provided in section eight hundred fifty-two of this chapter, against
40 the tax imposed by this article.
41 (b) Carryovers. The credit allowed under this subdivision for any
42 taxable year shall not reduce the tax due for such year to less than the
43 higher of the amounts prescribed in paragraphs (c) and (d) of subdivi-
44 sion one of this section; provided, however, if the amount of this cred-
45 it allowable under this section for any taxable year reduces tax to such
46 amount, any amount of the credit not deductible in such taxable year may
47 be carried over to the following year or years and may be deducted from
48 the taxpayer's tax for such year or years.
49 48. MEI energy tax credit. (a) Allowance of credit. A taxpayer shall
50 be allowed a credit against the tax imposed by this article, to be
51 computed as provided in section eight hundred fifty-three of this chap-
52 ter, against the tax imposed by this article.
53 (b) Carryovers. The credit allowed under this subdivision for any
54 taxable year shall not reduce the tax due for such year to less than the
55 higher of the amounts prescribed in paragraphs (c) and (d) of subdivi-
56 sion one of this section; provided, however, if the amount of this cred-
A. 5575 6
1 it allowable under this section for any taxable year reduces tax to such
2 amount, any amount of the credit not deductible in such taxable year may
3 be carried over to the following year or years and may be deducted from
4 the taxpayer's tax for such year or years.
5 § 6. Subparagraph (B) of paragraph 1 of subsection (i) of section 606
6 of the tax law, is amended by adding three new clauses (xxxv), (xxxvi)
7 and (xxxvii) to read as follows:
8 (xxxv) MEI property tax creditAmount of MEI property tax credit
9 under subsection (vv)under subdivision forty-six of
10 section two hundred ten
11 (xxxvi) MEI wage tax credit underAmount of MEI wage tax credit
12 subsection (ww)under subdivision forty-seven of
13 section two hundred ten
14 (xxxvii) MEI energy tax credit underAmount of MEI energy tax credit
15 subsection (xx)under subdivision forty-eight of
16 section two hundred ten
17 § 7. Section 606 of the tax law is amended by adding three new
18 subsections (vv), (ww) and (xx) to read as follows:
19 (vv) MEI property tax credit. (1) Allowance of credit. A taxpayer
20 shall be allowed a credit, to be computed as provided in section eight
21 hundred fifty-one of this chapter, against the tax imposed by this arti-
22 cle.
23 (2) Application of credit. If the amount of the credit allowed under
24 this subsection for any taxable year shall exceed the taxpayer's tax for
25 such year, the excess shall be treated as an overpayment of tax to be
26 credited or refunded in accordance with the provisions of section six
27 hundred eighty-six of this article, provided, however, that no interest
28 shall be paid thereon.
29 (ww) MEI wage tax credit. (1) Allowance of credit. A taxpayer shall be
30 allowed a credit, to be computed as provided in section eight hundred
31 fifty-two of this chapter, against the tax imposed by this article.
32 (2) Application of credit. If the amount of the credit allowed under
33 this subsection for any taxable year shall exceed the taxpayer's tax for
34 such year, the excess shall be treated as an overpayment of tax to be
35 credited or refunded in accordance with the provisions of section six
36 hundred eighty-six of this article, provided, however, that no interest
37 shall be paid thereon.
38 (xx) MEI energy tax credit. (1) Allowance of credit. A taxpayer shall
39 be allowed a credit, to be computed as provided in section eight hundred
40 fifty-three of this chapter, against the tax imposed by this article.
41 (2) Application of credit. If the amount of the credit allowed under
42 this subsection for any taxable year shall exceed the taxpayer's tax for
43 such year, the excess shall be treated as an overpayment of tax to be
44 credited or refunded in accordance with the provisions of section six
45 hundred eighty-six of this article, provided, however, that no interest
46 shall be paid thereon.
47 § 8. Subparagraph (vi) of paragraph (a) of subdivision 1 of section
48 210 of the tax law, as amended by section 1 of part C of chapter 56 of
49 the laws of 2011, is amended to read as follows:
50 (vi) for taxable years beginning on or after January thirty-first, two
51 thousand seven, the amount prescribed by this paragraph for a taxpayer
52 which is a qualified New York manufacturer, shall be computed at the
53 rate of six and one-half (6.5) percent of the taxpayer's entire net
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1 income base. For taxable years beginning on or after January first, two
2 thousand twelve [and before January first, two thousand fifteen], the
3 amount prescribed by this paragraph for a taxpayer which is [an eligi-
4 ble] a qualified New York manufacturer shall be computed at the rate of
5 three and one-quarter (3.25) percent of the taxpayer's entire net income
6 base. The term "manufacturer" shall mean a taxpayer which during the
7 taxable year is principally engaged in the production of goods by manu-
8 facturing, processing, assembling, refining, mining, extracting, farm-
9 ing, agriculture, horticulture, floriculture, viticulture or commercial
10 fishing. However, the generation and distribution of electricity, the
11 distribution of natural gas, and the production of steam associated with
12 the generation of electricity shall not be qualifying activities for a
13 manufacturer under this subparagraph. Moreover, the combined group shall
14 be considered a "manufacturer" for purposes of this subparagraph only if
15 the combined group during the taxable year is principally engaged in the
16 activities set forth in this paragraph, or any combination thereof. A
17 taxpayer or a combined group shall be "principally engaged" in activ-
18 ities described above if, during the taxable year, more than fifty
19 percent of the gross receipts of the taxpayer or combined group, respec-
20 tively, are derived from receipts from the sale of goods produced by
21 such activities. In computing a combined group's gross receipts, inter-
22 corporate receipts shall be eliminated. A "qualified New York manufac-
23 turer" is a manufacturer which has property in New York which is
24 described in clause (A) of subparagraph (i) of paragraph (b) of subdivi-
25 sion twelve of this section and either (I) the adjusted basis of such
26 property for federal income tax purposes at the close of the taxable
27 year is at least one million dollars or (II) all of its real and
28 personal property is located in New York. In addition, a "qualified New
29 York manufacturer" means a taxpayer which is defined as a qualified
30 emerging technology company under paragraph (c) of subdivision one of
31 section thirty-one hundred two-e of the public authorities law regard-
32 less of the ten million dollar limitation expressed in subparagraph one
33 of such paragraph (c). [The commissioner shall establish guidelines and
34 criteria that specify requirements by which a manufacturer may be clas-
35 sified as an eligible qualified New York manufacturer. Criteria may
36 include but not be limited to factors such as regional unemployment, the
37 economic impact that manufacturing has on the surrounding community,
38 population decline within the region and median income within the region
39 in which the manufacturer is located. In establishing these guidelines
40 and criteria, the commissioner shall endeavor that the total annual cost
41 of the lower rates shall not exceed twenty-five million dollars.]
42 § 9. Subparagraph 1 of paragraph (b) of subdivision 1 of section 210
43 of the tax law, as amended by section 1 of part GG-1 of chapter 57 of
44 the laws of 2008, is amended to read as follows:
45 (1) The amount prescribed by this paragraph for taxable years begin-
46 ning before January first, two thousand eight shall be computed at .178
47 percent for each dollar of the taxpayer's total business and investment
48 capital, or the portion thereof allocated within the state as hereinaft-
49 er provided. For taxable years beginning on or after January first, two
50 thousand eight, the amount prescribed by this paragraph shall be
51 computed at .15 percent for each dollar of the taxpayer's total business
52 and investment capital, or the portion thereof allocated within the
53 state as hereinafter provided. However, in the case of a cooperative
54 housing corporation as defined in the internal revenue code, the appli-
55 cable rate shall be .04 percent. For taxable years beginning on or
56 after January first, two thousand fourteen, the amount prescribed by
A. 5575 8
1 this paragraph for a taxpayer which is a qualified New York manufacturer
2 shall be computed at the rate of .075 percent of the taxpayer's total
3 business and investment capital, or the portion thereof allocated within
4 the state as hereinafter provided. In no event shall the amount
5 prescribed by this paragraph exceed three hundred fifty thousand dollars
6 for qualified New York manufacturers and for all other taxpayers ten
7 million dollars for taxable years beginning on or after January first,
8 two thousand eight but before January first, two thousand eleven and one
9 million dollars for taxable years beginning on or after January first,
10 two thousand eleven.
11 § 10. Clause (B) of subparagraph (ii) of paragraph (c) of subdivision
12 1 of section 210 of the tax law, as amended by section 2 of part C of
13 chapter 56 of the laws of 2011, is amended to read as follows:
14 (B) For taxable years beginning on or after January first, two thou-
15 sand twelve [and before January first, two thousand fifteen], the amount
16 prescribed by this paragraph for [an eligible] a qualified New York
17 manufacturer shall be computed at the rate of seventy-five hundredths
18 (.75) percent of the taxpayer's minimum taxable income base. For
19 purposes of this clause, the term "[eligible] qualified New York
20 manufacturer" shall have the same meaning as in subparagraph (vi) of
21 paragraph (a) of this subdivision.
22 § 11. Subparagraph 5 of paragraph (d) of subdivision 1 of section 210
23 of the tax law, as added by section 3 of part C of chapter 56 of the
24 laws of 2011, is amended to read as follows:
25 (5) For taxable years beginning on or after January first, two thou-
26 sand twelve [and before January first, two thousand fifteen], the
27 amounts prescribed in subparagraphs one and four of this paragraph as
28 the fixed dollar minimum tax for [an eligible] a qualified New York
29 manufacturer shall be one-half of the amounts stated in those subpara-
30 graphs. For purposes of this subparagraph, the term "[eligible] quali-
31 fied New York manufacturer" shall have the same meaning as in subpara-
32 graph (vi) of paragraph (a) of this subdivision.
33 § 12. This act shall take effect on the one hundred eightieth day
34 after it shall have become a law and shall apply to taxable years begin-
35 ning on or after January 1, 2014 and before January 1, 2021; provided,
36 however, that the addition, amendment and/or repeal of any rule or regu-
37 lation necessary for the implementation of this act on its effective
38 date are authorized and directed to be made on or before such date.
