Bill Text: NY A05332 | 2019-2020 | General Assembly | Introduced


Bill Title: Establishes the manufacturing preservation and enhancement act to foster economic growth and job creation; provides manufacturing enhancement incentive wage tax credits and energy tax credits and increases the real property tax credit for manufacturers.

Spectrum: Partisan Bill (Republican 2-0)

Status: (Introduced) 2019-02-08 - referred to economic development [A05332 Detail]

Download: New_York-2019-A05332-Introduced.html


                STATE OF NEW YORK
        ________________________________________________________________________
                                          5332
                               2019-2020 Regular Sessions
                   IN ASSEMBLY
                                    February 8, 2019
                                       ___________
        Introduced  by  M. of A. KOLB -- 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 wage
          tax credit incentives for manufacturing firms enrolled in the  program
          (Part A); and to amend the tax law, in relation to increasing the real
          property tax credit for manufacturers (Part B)
          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. This act enacts into law major components of legislation  provid-
    12  ing  for  the creation of the manufacturing preservation and enhancement
    13  act and increasing the real property tax credit for manufacturers.  Each
    14  component is wholly contained within a Part identified as Parts A and B.
    15  The  effective  date for each particular provision contained within such
    16  Part is set forth in the last section of such Part. Any provision in any
    17  section contained with a Part, including the effective date of the Part,
    18  which makes  reference  to  a  section  "of  this  act",  when  used  in
    19  connection  with  that particular component, shall be deemed to mean and
    20  refer to the corresponding section of the Part in  which  it  is  found.
    21  Section  five  of this act sets forth the general effective date of this
    22  act.
    23                                   PART A
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD06096-01-9

        A. 5332                             2
     1    Section 1.  The economic development law is amended by  adding  a  new
     2  article 15 to read as follows:
     3                                 ARTICLE 15
     4               MANUFACTURING PRESERVATION AND ENHANCEMENT ACT
     5  Section 270. Definitions.
     6          271. Manufacturing preservation and enhancement program.
     7          272. Special provisions relating to certified manufacturers.
     8          273. Reporting.
     9    §  270.  Definitions. As used in this article, the following words and
    10  terms shall have the following meanings unless the content  shall  indi-
    11  cate another or different meaning or intent:
    12    1. "Program" shall mean the manufacturing preservation and enhancement
    13  program established pursuant to this article.
    14    2.  "Manufacturing firm" shall mean an enterprise, including corporate
    15  entities, partnerships and sole proprietors, engaged in the business  of
    16  production of goods and products from raw materials.
    17    3.  "Benchmark"  shall  mean  a  specific  number of eligible new jobs
    18  created in the state pursuant to the program.
    19    4. "MEI" shall mean the manufacturing enhancement incentive program.
    20    § 271. Manufacturing preservation and enhancement program.   1.  There
    21  is  hereby  created a manufacturing preservation and enhancement program
    22  within the department to provide technical and financial  assistance  in
    23  the  form  of  tax incentives to manufacturing firms that meet specified
    24  benchmarks in job creation as established by the commissioner.
    25    2. The  commissioner  shall  determine  eligibility  requirements  for
    26  participation  in the program, provided, however, that such requirements
    27  shall include the following:
    28    (a) An applicant to the program may not participate in the program  if
    29  designated  as  a  certified  business located in an empire zone created
    30  pursuant to article eighteen-B of the general municipal law; and
    31    (b) An applicant that has previously participated in the  program  may
    32  not reapply for participation in the program unless it can document that
    33  at  the time of its reapplication for participation, it has maintained a
    34  level of employment at least as great  as  the  highest  level  required
    35  during its previous participation in the program.
    36    3.  Applications  for  participation  in the MEI shall be submitted by
    37  each manufacturing firm seeking to participate in the program, and shall
    38  be in the form and contain such  information,  exhibits  and  supporting
    39  data  as  the  commissioner  may  prescribe. No applications for partic-
    40  ipation shall be accepted  after  December  thirty-first,  two  thousand
    41  twenty-seven.
    42    4.  Manufacturing  firms  interested in participating in the MEI shall
    43  submit an application to the program. The commissioner shall review  all
    44  applications  for participation in the program for eligibility and shall
    45  register eligible applicants. The commissioner shall provide each regis-
    46  tered applicant with benchmarks in job creation that must be achieved by
    47  the registered applicant over the following one  year.  Such  benchmarks
    48  shall be consistent with regulations to be prescribed by the commission-
    49  er. Annually, each registered applicant shall submit to the commissioner
    50  a  registration  statement, together with such information, exhibits and
    51  supporting data as the commissioner may require. Upon submission of  the
    52  second  annual registration statement, the commissioner shall review the
    53  registered applicant's file for eligibility for the tax  incentives.  If
    54  the  registered  applicant  has  met  the  required  benchmarks  in  job
    55  creation, the commissioner shall provide a certificate,  valid  for  the
    56  succeeding  five  tax years, certifying that the registered applicant is

        A. 5332                             3
     1  eligible for tax credits pursuant to this article. The  MEI  certificate
     2  shall  include  a  description of the property eligible for the property
     3  tax benefit and shall specify the employment level and total  amount  of
     4  employee gross salary eligible for the wage credit.
     5    §  272. Special provisions relating to certified manufacturers. During
     6  the five-year certification period, certified manufacturing firms  shall
     7  be eligible to receive the following tax credits:
     8    1.    An  MEI  wage  tax  credit,  which shall be computed pursuant to
     9  section eight hundred sixty-one of the tax law; and
    10    2. An MEI energy tax credit,  which  shall  be  computed  pursuant  to
    11  section eight hundred sixty-two of the tax law.
    12    §  273.  Reporting.  The  commissioner  shall,  on or before September
    13  first, two thousand twenty, and annually thereafter, submit a report  to
    14  the  governor, the temporary president of the senate, the speaker of the
    15  assembly, the minority leader of the senate and the minority  leader  of
    16  the  assembly  on  the  operation  and  accomplishments  of  the program
    17  provided for pursuant to this article.
    18    § 2. The tax law is amended by adding a new article 24-A  to  read  as
    19  follows:
    20                                ARTICLE 24-A
    21               MANUFACTURING PRESERVATION AND ENHANCEMENT ACT
    22  Section 861. MEI wage tax credit.
    23          862. MEI energy tax credit.
    24    §  861.  MEI  wage  tax  credit.  (a)  Allowance of credit. A taxpayer
    25  receiving an MEI certificate that has been issued  pursuant  to  article
    26  fifteen  of  the economic development law, and that or who is subject to
    27  taxes under article nine-A or article twenty-two of this chapter,  shall
    28  be  allowed  a credit against the taxes assessed under article nine-A or
    29  article twenty-two of this chapter during the tax years that the certif-
    30  icate is valid. The credit shall be computed pursuant to the  provisions
    31  of subsection (c) of this section.
    32    (b) Definitions. The term "eligible wages" shall mean the total amount
    33  of  employee  gross  salary  eligible  for  the wage tax credit, as such
    34  amount is specified in the MEI certificate issued  pursuant  to  article
    35  fifteen of the economic development law.
    36    (c)  Computation  of wage tax credit. (1) During the first tax year of
    37  the five-year period for which a valid MEI certificate has  been  issued
    38  pursuant  to  article  fifteen of the economic development law, provided
    39  the taxpayer has maintained the employment and  eligible  wage  require-
    40  ments specified by the MEI as defined in article fifteen of the economic
    41  development  law, the taxpayer shall be allowed a credit of one and one-
    42  half percent of the total amount of the eligible wages actually paid  by
    43  the taxpayer. If the taxpayer increases employment during this tax year,
    44  and  exceeds  the  level of employment required by the MEI as defined in
    45  article fifteen of the economic development law, hiring and  maintaining
    46  additional  employees  and  paying  additional  wages over and above the
    47  eligible wages amount, the taxpayer shall be allowed an additional cred-
    48  it of two and one-half percent of the total amount by  which  the  wages
    49  actually  paid  as  a result of the increased level of employment exceed
    50  the eligible wages.
    51    (2) During the second tax year of the five-year  period  for  which  a
    52  valid MEI certificate has been issued pursuant to article fifteen of the
    53  economic  development  law,  provided  the  taxpayer  has maintained the
    54  employment and eligible  wage  requirements  specified  by  the  MEI  as
    55  defined in article fifteen of the economic development law, the taxpayer
    56  shall  be  allowed  a  credit  of  one and one-half percent of the total

        A. 5332                             4
     1  amount of the eligible wages actually paid by the taxpayer; however,  if
     2  the  taxpayer increased employment in the preceding tax year and claimed
     3  the two and one-half percent credit for employment and payment of  wages
     4  in  excess  of  the  MEI requirements pursuant to article fifteen of the
     5  economic development law, the taxpayer shall be allowed a credit of  one
     6  and  one-half percent of the total amount of the eligible wages actually
     7  paid by the taxpayer during the preceding tax year, provided the taxpay-
     8  er has maintained the increased employment and  salary  levels.  If  the
     9  taxpayer  again  increases employment, hiring and maintaining additional
    10  employees and paying additional wages over and above  the  previous  tax
    11  year's amount, the taxpayer shall be allowed an additional credit of two
    12  and  one-half  percent  of  the total amount by which the wages actually
    13  paid as a result of the increased level of employment exceed  the  wages
    14  subject to the one and one-half percent credit.
    15    §  862.  MEI  energy  tax credit. (a) Allowance of credit.  A taxpayer
    16  receiving an MEI certificate has been issued pursuant to article fifteen
    17  of the economic development law, and that or who  is  subject  to  taxes
    18  under  article  nine-A  or  article twenty-two of this chapter, shall be
    19  allowed a credit against the taxes  assessed  under  article  nine-A  or
    20  article twenty-two of this chapter during the tax years that the certif-
    21  icate  is valid. The credit shall be computed pursuant to the provisions
    22  of subsection (c) of this section.
    23    (b) Definition. The  term  "eligible  energy  costs"  shall  mean  the
    24  amounts  paid by the taxpayer for electricity, natural gas, or any other
    25  energy product or service which the taxpayer has used in  the  operation
    26  of  a  MEI  certified  manufacturing  firm  facility pursuant to article
    27  fifteen of the economic development law.
    28    (c) Computation of energy credit. (1) If the taxpayer has paid  eligi-
    29  ble  energy  costs during the first tax year of the five-year period for
    30  which a valid MEI  certificate  has  been  issued  pursuant  to  article
    31  fifteen of the economic development law, provided the taxpayer has main-
    32  tained  the  employment and eligible wages requirements specified by the
    33  MEI as defined in article fifteen of the economic development  law,  the
    34  taxpayer  shall  be  allowed an energy credit of twenty-five dollars per
    35  employee required by the MEI  as  defined  in  article  fifteen  of  the
    36  economic  development  law.  If the taxpayer increases employment during
    37  this tax year, and exceeds the level of employment required by  the  MEI
    38  as  defined  in  article fifteen of the economic development law, hiring
    39  and maintaining additional employees and paying  additional  wages  over
    40  and  above  the  eligible wages amount, the taxpayer shall be allowed an
    41  additional energy credit of fifty dollars per each additional  employee.
    42  The  energy  tax  credit  shall not exceed the amount of eligible energy
    43  costs actually paid by the taxpayer.
    44    (2) If the taxpayer has paid eligible energy costs during  the  second
    45  tax  year  of the five-year period for which a valid MEI certificate has
    46  been issued pursuant to article fifteen of the economic development law,
    47  provided the taxpayer has maintained the employment  and  eligible  wage
    48  requirements  specified  by the MEI as defined in article fifteen of the
    49  economic development law, the taxpayer shall be allowed an energy credit
    50  of twenty-five dollars per employee required by the MEI  as  defined  in
    51  article fifteen of the economic development law; however, if the taxpay-
    52  er  increased  employment  during the preceding tax year and claimed the
    53  additional energy tax credit of fifty dollars per  additional  employee,
    54  the  taxpayer  shall  be  allowed  a  credit  of twenty-five dollars per
    55  employee up to the number of employees claimed in the previous tax year,
    56  provided the taxpayer has maintained the increased employment  and  wage

        A. 5332                             5
     1  levels.  If  the  taxpayer again increases employment, hiring additional
     2  employees and paying additional wages over and above  the  previous  tax
     3  year's  amounts,  the  taxpayer shall be allowed an additional credit of
     4  fifty dollars for each additional employee hired during the second year.
     5  The  energy  tax  credit  shall not exceed the amount of eligible energy
     6  costs actually paid by the taxpayer.
     7    § 3. Section 210-B of the tax law is amended by adding two new  subdi-
     8  visions 53 and 54 to read as follows:
     9    53. MEI wage tax credit.  (a) Allowance of credit. A taxpayer shall be
    10  allowed a credit against the tax imposed by this article, to be computed
    11  as  provided in section eight hundred sixty-one of this chapter, against
    12  the tax imposed by this article.
    13    (b) Carryovers. The credit allowed  under  this  subdivision  for  any
    14  taxable year shall not reduce the tax due for such year to less than the
    15  amount  prescribed  in  paragraph  (d) of subdivision one of section two
    16  hundred ten of this article; provided, however, if the  amount  of  this
    17  credit  allowable under this section for any taxable year reduces tax to
    18  such amount, any amount of the credit not  deductible  in  such  taxable
    19  year  may  be  carried  over  to  the following year or years and may be
    20  deducted from the taxpayer's tax for such year or years.
    21    54. MEI energy tax credit. (a) Allowance of credit. A  taxpayer  shall
    22  be  allowed  a  credit  against  the  tax imposed by this article, to be
    23  computed as provided in section eight hundred sixty-two of this chapter,
    24  against the tax imposed by this article.
    25    (b) Carryovers. The credit allowed  under  this  subdivision  for  any
    26  taxable year shall not reduce the tax due for such year to less than the
    27  amount  prescribed  in  paragraph  (d) of subdivision one of section two
    28  hundred ten of this article; provided, however, if the  amount  of  this
    29  credit  allowable under this section for any taxable year reduces tax to
    30  such amount, any amount of the credit not  deductible  in  such  taxable
    31  year  may  be  carried  over to the following year   or years and may be
    32  deducted from the taxpayer's tax for such year or years.
    33    § 4. Subparagraph (B) of paragraph 1 of subsection (i) of section  606
    34  of  the tax law is amended by adding two new clauses (xliv) and (xlv) to
    35  read as follows:
    36  (xliv) MEI wage tax credit under     Amount of MEI wage tax credit
    37  subsection (jjj)                     under subdivision fifty three of
    38                                       section two hundred ten-B
    39  (xlv) MEI energy tax credit under    Amount of MEI energy tax credit
    40  subsection (kkk)                     under subdivision fifty-four of
    41                                       section two hundred ten-B
    42    § 5. Section 606  of  the  tax  law  is  amended  by  adding  two  new
    43  subsections (jjj) and (kkk) to read as follows:
    44    (jjj)  MEI  wage tax credit. (1) Allowance of credit. A taxpayer shall
    45  be allowed a credit, to be computed as provided in section eight hundred
    46  sixty-one of this chapter, against the tax imposed by this article.
    47    (2) Application of credit. If the amount of the credit  allowed  under
    48  this subsection for any taxable year shall exceed the taxpayer's tax for
    49  such  year,  the  excess shall be treated as an overpayment of tax to be
    50  credited or refunded in accordance with the provisions  of  section  six
    51  hundred  eighty-six of this article, provided, however, that no interest
    52  shall be paid thereon.

        A. 5332                             6
     1    (kkk) MEI energy tax credit. (1) Allowance of credit. A taxpayer shall
     2  be allowed a credit, to be computed as provided in section eight hundred
     3  sixty-two of this chapter, against the tax imposed by this article.
     4    (2)  Application  of credit. If the amount of the credit allowed under
     5  this subsection for any taxable year shall exceed the taxpayer's tax for
     6  such year, the excess shall be treated as an overpayment of  tax  to  be
     7  credited  or  refunded  in accordance with the provisions of section six
     8  hundred eighty-six of this article, provided, however, that no  interest
     9  shall be paid thereon.
    10    § 6. This act shall take effect on the one hundred eightieth day after
    11  it shall have become a law and shall apply to taxable years beginning on
    12  or  after January 1, 2020 and before January 1, 2027; provided, however,
    13  that the addition, amendment and/or repeal of  any  rule  or  regulation
    14  necessary  for  the implementation of this act on its effective date are
    15  authorized and directed to be made on or before such date.
    16                                   PART B
    17    Section 1. Paragraph (a) of subdivision 43 of section 210-B of the tax
    18  law, as added by section 17 of part A of chapter 59 of the laws of 2014,
    19  is amended to read as follows:
    20    (a) A qualified New York manufacturer, as defined in subparagraph (vi)
    21  of paragraph (a) of subdivision one of section two hundred ten  of  this
    22  article, will be allowed a credit equal to [twenty] fifty percent of the
    23  real  property  tax  it  paid  during the taxable year for real property
    24  owned by such manufacturer in New York which was principally used during
    25  the taxable year for manufacturing to the extent not deducted in  deter-
    26  mining    entire net income. This credit will not be allowed if the real
    27  property taxes that are the basis for this credit are  included  in  the
    28  calculation of another credit claimed by the taxpayer.
    29    §  2. Paragraph 1 of subsection (xx) of section 606 of the tax law, as
    30  amended by section 8 of part I of chapter 59 of the  laws  of  2015,  is
    31  amended to read as follows:
    32    (1)  A  qualified New York manufacturer will be allowed a credit equal
    33  to [twenty] fifty percent of the real property tax it  paid  during  the
    34  taxable  year  for  real property owned by such manufacturer in New York
    35  which was principally used during the taxable year for manufacturing  to
    36  the  extent  not  deducted  in computing New York adjusted gross income.
    37  This credit will not be allowed if the real property taxes that are  the
    38  basis  for this credit are included in the calculation of another credit
    39  claimed by the taxpayer.
    40    § 3. This act shall take effect immediately and  shall  apply  to  tax
    41  years beginning on or after January 1, 2020.
    42    § 4. Severability clause. If any clause, sentence, paragraph, subdivi-
    43  sion,  section  or  part  of  this act shall be adjudged by any court of
    44  competent jurisdiction to be invalid, such judgment  shall  not  affect,
    45  impair,  or  invalidate  the remainder thereof, but shall be confined in
    46  its operation to the clause, sentence, paragraph,  subdivision,  section
    47  or part thereof directly involved in the controversy in which such judg-
    48  ment shall have been rendered. It is hereby declared to be the intent of
    49  the  legislature  that  this  act  would  have been enacted even if such
    50  invalid provisions had not been included herein.
    51    § 5. This act shall take effect immediately, provided,  however,  that
    52  the  applicable effective date of Part A and Part B of this act shall be
    53  as specifically set forth in the last section of such Parts.
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