§ 436 — Businesses locating in tax-free NY areas

§ 436. Businesses locating in tax-free NY areas. 1. A campus,\nuniversity or college that has sponsored a tax-free NY area (including\nany strategic state asset affiliated with the campus, university or\ncollege) shall solicit and accept applications from businesses to locate\nin such area that are consistent with the plan of such campus,\nuniversity or college or strategic state asset that has been approved\npursuant to section four hundred thirty-five of this article. Any\nbusiness that wants to locate in a tax-free NY area must submit an\napplication to the campus, university or college which is sponsoring the\ntax-free NY area by December thirty-first, two thousand twenty-five.\nPrior to such date, the commissioner shall prepare an evaluation on the\neffectiveness of the START-UP NY program and deliver it to the governor\nand the legislature to determine continued eligibility for application\nsubmissions.\n 2. (a) The sponsoring campus, university or college shall provide the\napplication and all supporting documentation of any business it decides\nto accept into its tax-free NY area to the commissioner for review. Such\napplication shall be in a form prescribed by the commissioner and shall\ncontain all information the commissioner determines is necessary to\nproperly evaluate the business's application, including, but not limited\nto, the name, address, and employer identification number of the\nbusiness; a description of the land or space the business will use, the\nterms of the lease agreement, if applicable, between the sponsoring\ncampus, university or college and the business, and whether or not the\nland or space being used by the business is being transferred or sublet\nto the business from some other business. The application must include a\ncertification by the business that it meets the eligibility criteria\nspecified in section four hundred thirty-three of this article and will\nalign with or further the academic mission of the sponsoring campus,\ncollege or university, and that the business's participation in the\nSTART-UP NY program will have positive community and economic benefits.\nThe application must also describe whether or not the business competes\nwith other businesses in the same community but outside the tax-free NY\narea. In addition, the application must include a description of how the\nbusiness plans to recruit employees from the local workforce.\n (b) The commissioner shall review such application and documentation\nwithin sixty days and may reject such application upon a determination\nthat the business does not meet the eligibility criteria in section four\nhundred thirty-three of this article, has submitted an incomplete\napplication, has failed to comply with subdivision three of this\nsection, or has failed to demonstrate that the business's participation\nin the START-UP NY program will have positive community and economic\nbenefits, which shall be evaluated based on factors including but not\nlimited to whether or not the business competes with other businesses in\nthe same community but outside the tax-free NY area as prohibited by\nsection four hundred forty of this article. If the commissioner rejects\nsuch application, it shall provide notice of such rejection to the\nsponsoring campus, university or college and business. If the\ncommissioner does not reject such application within sixty days, such\nbusiness is accepted to locate in such tax-free NY area, and the\napplication of such business shall constitute a contract between such\nbusiness and the sponsoring campus, university or college. The\nsponsoring campus, university or college must provide accepted\nbusinesses with documentation of their acceptances in such form as\nprescribed by the commissioner of taxation and finance which will be\nused to demonstrate such business's eligibility for the tax benefits\nspecified in section thirty-nine of the tax law.\n (c) If a state university campus proposes to enter into a lease with a\nbusiness for eligible land in a tax-free NY area with a term greater\nthan forty years, including any options to renew, or for eligible land\nin a tax-free NY area of one million or more square feet, the state\nuniversity campus, at the same time as the application is provided to\nthe commissioner, also must submit the lease for review to the START-UP\nNY approval board. If the board does not disapprove of the lease terms\nwithin thirty days, the lease is deemed approved. If the board\ndisapproves the lease terms, the state university campus must submit\nmodified lease terms to the commissioner for review. The commissioner's\nsixty day review period is suspended while the board is reviewing the\nlease and during the time it takes for the state university campus to\nmodify the lease terms.\n (d) Except as otherwise provided in this article, proprietary\ninformation or supporting documentation submitted by a business to a\nsponsoring campus, university or college shall only be utilized for the\npurpose of evaluating such business's application or compliance with the\nprovisions of this article and shall not be otherwise disclosed. Any\nperson who willfully discloses such information to a third party for any\nother purpose whatsoever shall be guilty of a misdemeanor.\n 3. The business submitting the application, as part of the\napplication, must:\n (a) agree to allow the department of taxation and finance to share its\ntax information with the department and the sponsoring campus,\nuniversity or college;\n (b) agree to allow the department of labor to share its tax and\nemployer information with the department and the sponsoring campus,\nuniversity or college;\n (c) allow the department and its agents and the sponsoring campus,\nuniversity or college access to any and all books and records the\ndepartment or sponsoring campus, university or college may require to\nmonitor compliance;\n (d) include performance benchmarks, including the number of net new\njobs that must be created, the schedule for creating those jobs, and\ndetails on job titles and expected salaries. The application must\nspecify the consequences for failure to meet such benchmarks, as\ndetermined by the business and the sponsoring campus, university or\ncollege: (i) suspension of such business's participation in the START-UP\nNY program for one or more tax years as specified in such application;\n(ii) termination of such business's participation in the START-UP NY\nprogram; and/or (iii) proportional recovery of tax benefits awarded\nunder the START-UP NY program as specified in section thirty-nine of the\ntax law;\n (e) provide the following information to the department and sponsoring\ncampus, university or college upon request:\n (i) the prior three years of federal and state income or franchise tax\nreturns, unemployment insurance quarterly returns, real property tax\nbills and audited financial statements;\n (ii) the employer identification or social security numbers for all\nrelated persons to the business, including those of any members of a\nlimited liability company or partners in a partnership;\n (f) provide a clear and detailed presentation of all related persons\nto the business to assure the department that jobs are not being shifted\nwithin the state; and\n (g) certify, under penalty of perjury, that it is in substantial\ncompliance with all environmental, worker protection, and local, state,\nand federal tax laws, and that it satisfies all the eligibility\nrequirements to participate in the START-UP NY program.\n 4. (a) At the conclusion of the lease term of a lease by the\nsponsoring campus, university or college to a business of land or space\nin a tax-free NY area owned by the sponsoring campus, university or\ncollege, the leased land or space and any improvements thereon shall\nrevert to the sponsoring campus, university or college, unless the lease\nis renewed.\n (b) If, at any time, the sponsoring campus, university or college or\nthe commissioner determines that a business no longer satisfies any of\nthe eligibility criteria specified in section four hundred thirty-three\nof this article, the sponsoring campus, university or college shall\nrecommend to the commissioner that the commissioner terminate or the\ncommissioner on his or her own initiative shall immediately terminate\nsuch business's participation in the START-UP NY program. Such business\nshall be notified of such termination by a method which allows for\nverification of receipt of such termination notice. A copy of such\ntermination notice shall be sent to the commissioner of taxation and\nfinance. Upon such termination, such business shall not be eligible for\nthe tax benefits specified in section thirty-nine of the tax law for\nthat or any future taxable year, calendar quarter or sales tax quarter,\nalthough employees of such business may continue to claim the tax\nbenefit for their wages during the remainder of that taxable year.\nFurther, such lease or contract between the sponsoring campus,\nuniversity or college and such business shall be rescinded, effective on\nthe thirtieth day after the commissioner mailed such termination notice\nto such business and the land or space and any improvements thereon\nshall revert to the sponsoring campus, university or college.\n 5. The commissioner shall promulgate regulations to effectuate the\npurposes of this section, including, but not limited to, establishing\nthe process for the evaluation and possible rejection of applications,\nthe eligibility criteria that will be applied in evaluating those\napplications, and the process for terminations from the START-UP NY\nprogram and administrative appeals of such terminations.\n