Bill Text: NY S03364 | 2017-2018 | General Assembly | Amended
Bill Title: Enacts the corporate accountability for tax expenditures act; standardizes applications for state development assistance for empire zone assistance and industrial development agency assistance; requires submission of certain development assistance agreements to the department of taxation and finance; requires recipients of certain development assistance to submit progress reports which include certain information and disclosures; makes certain recapture provisions; and defines relevant terms.
Spectrum: Partisan Bill (Democrat 3-0)
Status: (Introduced - Dead) 2018-06-18 - PRINT NUMBER 3364A [S03364 Detail]
Download: New_York-2017-S03364-Amended.html
STATE OF NEW YORK ________________________________________________________________________ 3364--A 2017-2018 Regular Sessions IN SENATE January 23, 2017 ___________ Introduced by Sens. KRUEGER, BAILEY, PARKER -- read twice and ordered printed, and when printed to be committed to the Committee on Corpo- rations, Authorities and Commissions -- recommitted to the Committee on Corporations, Authorities and Commissions in accordance with Senate Rule 6, sec. 8 -- committee discharged, bill amended, ordered reprinted as amended and recommitted to said committee AN ACT to amend the business corporation law and the public authorities law, in relation to enacting the "corporate accountability for tax expenditures act" 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 "corporate accountability for tax expenditures act". 3 § 2. The business corporation law is amended by adding a new article 4 14 to read as follows: 5 ARTICLE 14 6 CORPORATE ACCOUNTABILITY FOR TAX EXPENDITURES 7 Section 1401. Definitions. 8 1402. Unified economic development budget. 9 1403. Standardized applications for state development assist- 10 ance. 11 1404. State development assistance disclosure. 12 1405. Recapture. 13 § 1401. Definitions. 14 As used in this article: 15 (a) "Base years" means the first two complete calendar years following 16 the effective date of a recipient receiving development assistance. 17 (b) "Date of assistance" means the commencement date of the assistance 18 agreement, which date triggers the period during which the recipient is 19 obligated to create or retain jobs and continue operations at the 20 specific project site. EXPLANATION--Matter in italics (underscored) is new; matter in brackets [] is old law to be omitted. LBD05985-02-8S. 3364--A 2 1 (c) "Default" means that a recipient has not achieved its job 2 creation, job retention, or wage or benefit goals, as applicable, during 3 the prescribed period therefor. 4 (d) "Department" means, unless otherwise noted, the department of 5 taxation and finance or any successor agency. 6 (e) "Development assistance" means (1) tax credits and tax exemptions 7 (other than given under tax increment financing) given as an incentive 8 to a recipient business organization pursuant to an initial certif- 9 ication or an initial designation made by the department under article 10 eighteen-A or eighteen-B of the general municipal law; 11 (2) all successor and subsequent programs and tax credits designed to 12 promote large business relocations and expansions. "Development assist- 13 ance" does not include tax increment financing, assistance provided by 14 industrial development agencies under article eighteen-A or eighteen-B 15 of the general municipal law pursuant to local ordinance, participation 16 loans, or financial transactions through statutorily authorized finan- 17 cial intermediaries in support of small business loans and investments 18 or given in connection with the development of affordable housing. 19 (f) "Development assistance agreement" means any agreement executed by 20 the state granting body and the recipient setting forth the terms and 21 conditions of development assistance to be provided to the recipient 22 consistent with the final application for development assistance, 23 including but not limited to the date of assistance, submitted to and 24 approved by the state granting body. 25 (g) "Full-time, permanent job" means a job in which the new employee 26 works for the recipient at a rate of at least thirty-five hours per 27 week. 28 (h) "New employee" means a full-time, permanent employee who repres- 29 ents a net increase in the number of the recipient's employees state- 30 wide. "New employee" includes an employee who previously filled a new 31 employee position with the recipient who was rehired or called back from 32 a layoff that occurs during or following the base years. 33 The term "new employee" does not include any of the following: 34 (1) An employee of the recipient who performs a job that was previous- 35 ly performed by another employee in this state, if that job existed in 36 this state for at least six months before hiring the employee. 37 (2) A child, grandchild, parent, or spouse, other than a spouse who is 38 legally separated from the individual, of any individual who has a 39 direct or indirect ownership interest of at least five percent in the 40 profits, capital, or value of any member of the recipient. 41 (i) "Part-time job" means a job in which the new employee works for 42 the recipient at a rate of less than thirty-five hours per week. 43 (j) "Recipient" means any business that receives economic development 44 assistance. A business is any corporation, limited liability company, 45 partnership, joint venture, association, sole proprietorship, or other 46 legally recognized entity. 47 (k) "Retained employee" means any employee defined as having a full- 48 time or full-time equivalent job preserved at a specific facility or 49 site, the continuance of which is threatened by a specific and demon- 50 strable threat, which shall be specified in the application for develop- 51 ment assistance. 52 (l) "Specific project site" means that distinct operational unit to 53 which any development assistance is applied. 54 (m) "State granting body" means the department, any other state 55 department or state agency that provides development assistance that hasS. 3364--A 3 1 reporting requirements under this article, and any successor agencies to 2 any of the preceding. 3 (n) "Temporary job" means a job in which the new employee is hired for 4 a specific duration of time or season. 5 (o) "Value of assistance" means the face value of any form of develop- 6 ment assistance. 7 § 1402. Unified economic development budget. 8 (a) For each state fiscal year ending on or after June thirtieth, two 9 thousand eighteen, the department shall submit an annual unified econom- 10 ic development budget to the governor, senate and assembly. The unified 11 economic development budget shall be due within three months after the 12 end of the fiscal year, and shall present all types of development 13 assistance granted during the prior fiscal year, including: 14 (1) The aggregate amount of uncollected or diverted state tax revenues 15 resulting from each type of development assistance provided pursuant to 16 law, as reported to the department on tax returns filed during the 17 fiscal year. 18 (2) All state development assistance. 19 (b) All data contained in the unified economic development budget 20 presented to the governor, senate and assembly shall be fully subject to 21 the freedom of information act. 22 (c) The department shall submit a report of the amounts in subpara- 23 graph one of paragraph (a) of this section to the department, which may 24 append such report to the unified economic development budget rather 25 than separately reporting such amounts. 26 § 1403. Standardized applications for state development assistance. 27 (a) All final applications submitted to the department or any other 28 state granting body requesting development assistance shall contain, at 29 a minimum: 30 (1) An application tracking number that is specific to both the state 31 granting agency and to each application. 32 (2) The office mailing address, office telephone number, and chief 33 officer of the granting body. 34 (3) The office mailing address, telephone number, and the name of the 35 chief officer of the applicant or authorized designee for the specific 36 project site for which development assistance is requested. 37 (4) The applicant's total number of employees at the specific project 38 site on the date that the application is submitted to the state granting 39 body, including the number of full-time, permanent jobs, the number of 40 part-time jobs, and the number of temporary jobs. 41 (5) The type of development assistance and value of assistance being 42 requested. 43 (6) The number of jobs to be created and retained or both created and 44 retained by the applicant as a result of the development assistance, 45 including the number of full-time, permanent jobs, the number of part- 46 time jobs, and the number of temporary jobs. 47 (7) A detailed list of the occupation or job classifications and 48 number of new employees or retained employees to be hired in full-time, 49 permanent jobs, a schedule of anticipated starting dates of the new 50 hires and the anticipated average wage by occupation or job classifica- 51 tion and total payroll to be created as a result of the development 52 assistance. 53 (8) A list of all other forms of development assistance that the 54 applicant is requesting for the specific project site and the name of 55 each state granting body from which that development assistance is being 56 requested.S. 3364--A 4 1 (9) A narrative, if necessary, describing why the development assist- 2 ance is needed and how the applicant's use of the development assistance 3 may reduce employment at any site in New York. 4 (10) A certification by the chief officer of the applicant or his or 5 her authorized designee that the information contained in the applica- 6 tion submitted to the granting body contains no knowing misrepresen- 7 tation of material facts upon which eligibility for development assist- 8 ance is based. 9 (b) Every state granting body either shall complete, or shall require 10 the applicant to complete, an application form that meets the minimum 11 requirements as prescribed in this section each time an applicant 12 applies for development assistance covered by this article. 13 (c) The department shall have the discretion to modify any standard- 14 ized application for state development assistance required under para- 15 graph (a) of this section for any grants that are not given as an incen- 16 tive to a recipient business organization. 17 § 1404. State development assistance disclosure. 18 (a) Beginning February first, two thousand nineteen and each year 19 thereafter, every state granting body shall submit to the department 20 copies of all development assistance agreements that it approved in the 21 prior calendar year. 22 (b) For each development assistance agreement for which the date of 23 assistance has occurred in the prior calendar year, each recipient shall 24 submit to the department a progress report that shall include, but not 25 be limited to, the following: 26 (1) The application tracking number. 27 (2) The office mailing address, telephone number, and the name of the 28 chief officer of the granting body. 29 (3) The office mailing address, telephone number, and the name of the 30 chief officer of the applicant or authorized designee for the specific 31 project site for which the development assistance was approved by the 32 state granting body. 33 (4) The type of development assistance program and value of assistance 34 that was approved by the state granting body. 35 (5) The applicant's total number of employees at the specific project 36 site on the date that the application was submitted to the state grant- 37 ing body and the applicant's total number of employees at the specific 38 project site on the date of the report, including the number of full- 39 time, permanent jobs, the number of part-time jobs, and the number of 40 temporary jobs, and a computation of the gain or loss of jobs in each 41 category. 42 (6) The number of new employees and retained employees the applicant 43 stated in its development assistance agreement, if any, if not, then in 44 its application, would be created by the development assistance broken 45 down by full-time, permanent, part-time, and temporary. 46 (7) A sworn declaration of whether the recipient is in compliance with 47 the development assistance agreement. 48 (8) A detailed list of the occupation or job classifications and 49 number of new employees or retained employees to be hired in full-time, 50 permanent jobs, a schedule of anticipated starting dates of the new 51 hires and the actual average wage by occupation or job classification 52 and total payroll to be created as a result of the development assist- 53 ance. 54 (9) A narrative, if necessary, describing how the recipient's use of 55 the development assistance during the reporting year has reduced employ- 56 ment at any site in New York.S. 3364--A 5 1 (10) A certification by the chief officer of the applicant or his or 2 her authorized designee that the information in the progress report 3 contains no knowing misrepresentation of material facts upon which 4 eligibility for development assistance is based. 5 (c) The state granting body, or a successor agency, shall have full 6 authority to verify information contained in the recipient's progress 7 report, including the authority to inspect the specific project site and 8 inspect the records of the recipient that are subject to the development 9 assistance agreement. 10 (d) By June first, two thousand nineteen and by June first of each 11 year thereafter, the department shall compile and publish all data in 12 all of the progress reports in both written and electronic form. 13 (e) If a recipient of development assistance fails to comply with 14 paragraph (b) of this section, the department shall, within twenty work- 15 ing days after the reporting submittal deadlines set forth in such para- 16 graph (b), suspend within thirty-three working days any current develop- 17 ment assistance to such recipient under its control, and shall be 18 prohibited from completing any current or providing any future develop- 19 ment assistance until it receives proof that such recipient has come 20 into compliance with the requirements of paragraph (b) of this section. 21 (f) The department shall have the discretion to modify the information 22 required in the progress report required under paragraph (b) of this 23 section consistent with the disclosure purpose of this section for any 24 grants that are not given as an incentive to a recipient business organ- 25 ization. 26 § 1405. Recapture. 27 (a) All development assistance agreements shall contain, at a minimum, 28 the following recapture provisions: 29 (1) The recipient must (i) make the level of capital investment in the 30 economic development project specified in the development assistance 31 agreement; (ii) create or retain, or both, the requisite number of jobs, 32 paying not less than specified wages for the created and retained jobs, 33 within and for the duration of the time period specified in the develop- 34 ment assistance programs and the development assistance agreement. 35 (2) If the recipient fails to create or retain the requisite number of 36 jobs within and for the time period specified, in the development 37 assistance programs and the development assistance agreement, the recip- 38 ient shall be deemed to no longer qualify for the state economic assist- 39 ance and the applicable recapture provisions shall take effect. 40 (3) If the recipient receives state economic assistance in the form of 41 an empire zone designation pursuant to article eighteen-B of the general 42 municipal law or an industrial development zone designation pursuant to 43 article eighteen-A of the general municipal law and the recipient fails 44 to create or retain the requisite number of jobs, as determined by the 45 development assistance agreement within the requisite period of time, 46 the recipient shall be required to pay to the state the full amount of 47 the state tax exemption that it received as a result of such desig- 48 nation. 49 (4) If the recipient receives a grant or loan pursuant to an empire 50 zone designation pursuant to article eighteen-B of the general municipal 51 law or an industrial development zone designation pursuant to article 52 eighteen-A of the general municipal law and the recipient fails to 53 create or retain the requisite number of jobs for the requisite time 54 period, as provided in the development assistance agreement, the recipi- 55 ent shall be required to repay to the state a pro rata amount of the 56 grant; that amount shall reflect the percentage of the deficiencyS. 3364--A 6 1 between the requisite number of jobs to be created or retained by the 2 recipient and the actual number of such jobs in existence as of the date 3 the department determines the recipient is in breach of the job creation 4 or retention covenants contained in the development assistance agree- 5 ment. If the recipient of development assistance under such designations 6 ceases operations at the specific project site during a five year period 7 commencing on the date of assistance, the recipient shall be required to 8 repay the entire amount of the grant or to accelerate repayment of the 9 loan back to the state. 10 (5) If the recipient receives a tax credit under article eighteen-A or 11 eighteen-B of the general municipal law, the development assistance 12 agreement shall provide that (i) if the number of new or retained 13 employees falls below the requisite number set forth in the development 14 assistance agreement, the allowance of the credit shall be automatically 15 suspended until the number of new and retained employees equals or 16 exceeds the requisite number in the development assistance agreement; 17 (ii) if the recipient discontinues operations at the specific project 18 site during the first five years of the term of the development assist- 19 ance agreement, the recipient shall forfeit all credits taken by the 20 recipient during such five year period; and (iii) in the event of a 21 revocation or suspension of the credit, the department shall initiate 22 proceedings against the recipient to recover wrongfully exempted state 23 income taxes and the recipient shall promptly repay to the department 24 any wrongfully exempted state income taxes. The forfeited amount of 25 credits shall be deemed assessed on the date the department initiates 26 proceedings against such recipient and the recipient shall promptly 27 repay to the department any wrongfully exempted state income taxes. 28 (b) The commissioner of taxation and finance may elect to waive 29 enforcement of any contractual provision arising out of the development 30 assistance agreement required by this article based on a finding that 31 the waiver is necessary to avert an imminent and demonstrable hardship 32 to the recipient that may result in such recipient's insolvency or 33 discharge of workers. If a waiver is granted, the recipient shall agree 34 to a contractual modification, including recapture provisions, to the 35 development assistance agreement. The existence of any waiver granted 36 pursuant to paragraph (c) of this section, the date of the granting of 37 such waiver, and a brief summary of the reasons supporting the granting 38 of such waiver shall be disclosed consistent with the provisions of this 39 section. 40 (c) Beginning June first, two thousand eighteen, the department shall 41 annually compile a report on the outcomes and effectiveness of recapture 42 provisions by program, including but not limited to: (i) the total 43 number of companies that receive development assistance as defined in 44 this article; (ii) the total number of recipients in violation of devel- 45 opment agreements with the department; (iii) the total number of 46 completed recapture efforts; (iv) the total number of recapture efforts 47 initiated; and (v) the number of waivers granted. Such report shall be 48 disclosed consistent with the provisions of section fourteen hundred 49 four of this article. 50 § 3. The public authorities law is amended by adding a new article 51 10-E to read as follows: 52 ARTICLE 10-E 53 CORPORATE ACCOUNTABILITY FOR TAX EXPENDITURES 54 Section 3980. Definitions. 55 3981. Unified economic development budget.S. 3364--A 7 1 3982. Standardized applications for state development assist- 2 ance. 3 3983. State development assistance disclosure. 4 3984. Recapture. 5 § 3980. Definitions. As used in this article: 6 1. "Base years" means the first two complete calendar years following 7 the effective date of a recipient receiving development assistance. 8 2. "Date of assistance" means the commencement date of the assistance 9 agreement, which date triggers the period during which the recipient is 10 obligated to create or retain jobs and continue operations at the 11 specific project site. 12 3. "Default" means that a recipient has not achieved its job creation, 13 job retention, or wage or benefit goals, as applicable, during the 14 prescribed period therefor. 15 4. "Department" means, unless otherwise noted, the department of taxa- 16 tion and finance or any successor agency. 17 5. "Development assistance" means (a) tax credits and tax exemptions 18 (other than given under tax increment financing) given as an incentive 19 to a recipient public authority pursuant to an initial certification or 20 an initial designation made by the department under article eighteen-A 21 or eighteen-B of the general municipal law; 22 (b) all successor and subsequent programs and tax credits designed to 23 promote large business relocations and expansions. "Development assist- 24 ance" does not include tax increment financing, assistance provided by 25 industrial development agencies under article eighteen-A or eighteen-B 26 of the general municipal law pursuant to local ordinance, participation 27 loans, or financial transactions through statutorily authorized finan- 28 cial intermediaries in support of small business loans and investments 29 or given in connection with the development of affordable housing. 30 6. "Development assistance agreement" means any agreement executed by 31 the state granting body and the recipient setting forth the terms and 32 conditions of development assistance to be provided to the recipient 33 consistent with the final application for development assistance, 34 including but not limited to the date of assistance, submitted to and 35 approved by the state granting body. 36 7. "Full-time, permanent job" means a job in which the new employee 37 works for the recipient at a rate of at least thirty-five hours per 38 week. 39 8. "New employee" means a full-time, permanent employee who repres- 40 ents a net increase in the number of the recipient's employees state- 41 wide. "New employee" includes an employee who previously filled a new 42 employee position with the recipient who was rehired or called back from 43 a layoff that occurs during or following the base years. 44 The term "new employee" does not include any of the following: 45 (a) An employee of the recipient who performs a job that was previous- 46 ly performed by another employee in this state, if that job existed in 47 this state for at least six months before hiring the employee. 48 (b) A child, grandchild, parent, or spouse, other than a spouse who is 49 legally separated from the individual, of any individual who has a 50 direct or indirect ownership interest of at least five percent in the 51 profits, capital, or value of any member of the recipient. 52 9. "Part-time job" means a job in which the new employee works for the 53 recipient at a rate of less than thirty-five hours per week. 54 10. "Recipient" means any public authority created pursuant to this 55 chapter that receives economic development assistance or other legally 56 recognized entity of such a public authority.S. 3364--A 8 1 11. "Retained employee" means any employee defined as having a full- 2 time or full-time equivalent job preserved at a specific facility or 3 site, the continuance of which is threatened by a specific and demon- 4 strable threat, which shall be specified in the application for develop- 5 ment assistance. 6 12. "Specific project site" means that distinct operational unit to 7 which any development assistance is applied. 8 13. "State granting body" means the department, any other state 9 department or state agency that provides development assistance that has 10 reporting requirements under this article, and any successor agencies to 11 any of the preceding. 12 14. "Temporary job" means a job in which the new employee is hired for 13 a specific duration of time or season. 14 15. "Value of assistance" means the face value of any form of develop- 15 ment assistance. 16 § 3981. Unified economic development budget. 1. For each state fiscal 17 year ending on or after June thirtieth, two thousand eighteen, the 18 department shall submit an annual unified economic development budget to 19 the governor, senate and assembly. The unified economic development 20 budget shall be due within three months after the end of the fiscal 21 year, and shall present all types of development assistance granted 22 during the prior fiscal year, including: 23 (a) The aggregate amount of uncollected or diverted state tax revenues 24 resulting from each type of development assistance provided pursuant to 25 law, as reported to the department on tax returns filed during the 26 fiscal year. 27 (b) All state development assistance. 28 2. All data contained in the unified economic development budget 29 presented to the governor, senate and assembly shall be fully subject to 30 the freedom of information act. 31 3. The department shall submit a report of the amounts in paragraph 32 (a) of subdivision one of this section to the department, which may 33 append such report to the unified economic development budget rather 34 than separately reporting such amounts. 35 § 3982. Standardized applications for state development assistance. 36 1. All final applications submitted to the department or any other state 37 granting body requesting development assistance shall contain, at a 38 minimum: 39 (a) An application tracking number that is specific to both the state 40 granting agency and to each application. 41 (b) The office mailing address, office telephone number, and chief 42 officer of the granting body. 43 (c) The office mailing address, telephone number, and the name of the 44 chief officer of the applicant or authorized designee for the specific 45 project site for which development assistance is requested. 46 (d) The applicant's total number of employees at the specific project 47 site on the date that the application is submitted to the state granting 48 body, including the number of full-time, permanent jobs, the number of 49 part-time jobs, and the number of temporary jobs. 50 (e) The type of development assistance and value of assistance being 51 requested. 52 (f) The number of jobs to be created and retained or both created and 53 retained by the applicant as a result of the development assistance, 54 including the number of full-time, permanent jobs, the number of part- 55 time jobs, and the number of temporary jobs.S. 3364--A 9 1 (g) A detailed list of the occupation or job classifications and 2 number of new employees or retained employees to be hired in full-time, 3 permanent jobs, a schedule of anticipated starting dates of the new 4 hires and the anticipated average wage by occupation or job classifica- 5 tion and total payroll to be created as a result of the development 6 assistance. 7 (h) A list of all other forms of development assistance that the 8 applicant is requesting for the specific project site and the name of 9 each state granting body from which that development assistance is being 10 requested. 11 (i) A narrative, if necessary, describing why the development assist- 12 ance is needed and how the applicant's use of the development assistance 13 may reduce employment at any site in New York. 14 (j) A certification by the chief officer of the applicant or his or 15 her authorized designee that the information contained in the applica- 16 tion submitted to the granting body contains no knowing misrepresen- 17 tation of material facts upon which eligibility for development assist- 18 ance is based. 19 2. Every state granting body either shall complete, or shall require 20 the applicant to complete, an application form that meets the minimum 21 requirements as prescribed in this section each time an applicant 22 applies for development assistance covered by this article. 23 3. The department shall have the discretion to modify any standardized 24 application for state development assistance required under subdivision 25 one of this section for any grants that are not given as an incentive to 26 a recipient public authority. 27 § 3983. State development assistance disclosure. 1. Beginning Febru- 28 ary first, two thousand nineteen and each year thereafter, every state 29 granting body shall submit to the department copies of all development 30 assistance agreements that it approved in the prior calendar year. 31 2. For each development assistance agreement for which the date of 32 assistance has occurred in the prior calendar year, each recipient shall 33 submit to the department a progress report that shall include, but not 34 be limited to, the following: 35 (a) The application tracking number. 36 (b) The office mailing address, telephone number, and the name of the 37 chief officer of the granting body. 38 (c) The office mailing address, telephone number, and the name of the 39 chief officer of the applicant or authorized designee for the specific 40 project site for which the development assistance was approved by the 41 state granting body. 42 (d) The type of development assistance program and value of assistance 43 that was approved by the state granting body. 44 (e) The applicant's total number of employees at the specific project 45 site on the date that the application was submitted to the state grant- 46 ing body and the applicant's total number of employees at the specific 47 project site on the date of the report, including the number of full- 48 time, permanent jobs, the number of part-time jobs, and the number of 49 temporary jobs, and a computation of the gain or loss of jobs in each 50 category. 51 (f) The number of new employees and retained employees the applicant 52 stated in its development assistance agreement, if any, if not, then in 53 its application, would be created by the development assistance broken 54 down by full-time, permanent, part-time, and temporary. 55 (g) A sworn declaration of whether the recipient is in compliance with 56 the development assistance agreement.S. 3364--A 10 1 (h) A detailed list of the occupation or job classifications and 2 number of new employees or retained employees to be hired in full-time, 3 permanent jobs, a schedule of anticipated starting dates of the new 4 hires and the actual average wage by occupation or job classification 5 and total payroll to be created as a result of the development assist- 6 ance. 7 (i) A narrative, if necessary, describing how the recipient's use of 8 the development assistance during the reporting year has reduced employ- 9 ment at any site in New York. 10 (j) A certification by the chief officer of the applicant or his or 11 her authorized designee that the information in the progress report 12 contains no knowing misrepresentation of material facts upon which 13 eligibility for development assistance is based. 14 3. The state granting body, or a successor agency, shall have full 15 authority to verify information contained in the recipient's progress 16 report, including the authority to inspect the specific project site and 17 inspect the records of the recipient that are subject to the development 18 assistance agreement. 19 4. By June first, two thousand nineteen and by June first of each year 20 thereafter, the department shall compile and publish all data in all of 21 the progress reports in both written and electronic form. 22 5. If a recipient of development assistance fails to comply with 23 subdivision two of this section, the department shall, within twenty 24 working days after the reporting submittal deadlines set forth in such 25 subdivision two, suspend within thirty-three working days any current 26 development assistance to such recipient under its control, and shall be 27 prohibited from completing any current or providing any future develop- 28 ment assistance until it receives proof that such recipient has come 29 into compliance with the requirements of subdivision two of this 30 section. 31 6. The department shall have the discretion to modify the information 32 required in the progress report required under subdivision two of this 33 section consistent with the disclosure purpose of this section for any 34 grants that are not given as an incentive to a recipient public authori- 35 ty. 36 § 3984. Recapture. 1. All development assistance agreements shall 37 contain, at a minimum, the following recapture provisions: 38 (a) The recipient must (i) make the level of capital investment in the 39 economic development project specified in the development assistance 40 agreement; (ii) create or retain, or both, the requisite number of jobs, 41 paying not less than specified wages for the created and retained jobs, 42 within and for the duration of the time period specified in the develop- 43 ment assistance programs and the development assistance agreement. 44 (b) If the recipient fails to create or retain the requisite number of 45 jobs within and for the time period specified, in the development 46 assistance programs and the development assistance agreement, the recip- 47 ient shall be deemed to no longer qualify for the state economic assist- 48 ance and the applicable recapture provisions shall take effect. 49 (c) If the recipient receives state economic assistance in the form of 50 an empire zone designation pursuant to article eighteen-B of the general 51 municipal law or an industrial development zone designation pursuant to 52 article eighteen-A of the general municipal law and the recipient fails 53 to create or retain the requisite number of jobs, as determined by the 54 development assistance agreement within the requisite period of time, 55 the recipient shall be required to pay to the state the full amount ofS. 3364--A 11 1 the state tax exemption that it received as a result of such desig- 2 nation. 3 (d) If the recipient receives a grant or loan pursuant to an empire 4 zone designation pursuant to article eighteen-B of the general municipal 5 law or an industrial development zone designation pursuant to article 6 eighteen-A of the general municipal law and the recipient fails to 7 create or retain the requisite number of jobs for the requisite time 8 period, as provided in the development assistance agreement, the recipi- 9 ent shall be required to repay to the state a pro rata amount of the 10 grant; that amount shall reflect the percentage of the deficiency 11 between the requisite number of jobs to be created or retained by the 12 recipient and the actual number of such jobs in existence as of the date 13 the department determines the recipient is in breach of the job creation 14 or retention covenants contained in the development assistance agree- 15 ment. If the recipient of development assistance under such designations 16 ceases operations at the specific project site during a five year period 17 commencing on the date of assistance, the recipient shall be required to 18 repay the entire amount of the grant or to accelerate repayment of the 19 loan back to the state. 20 (e) If the recipient receives a tax credit under article eighteen-A or 21 eighteen-B of the general municipal law, the development assistance 22 agreement shall provide that (i) if the number of new or retained 23 employees falls below the requisite number set forth in the development 24 assistance agreement, the allowance of the credit shall be automatically 25 suspended until the number of new and retained employees equals or 26 exceeds the requisite number in the development assistance agreement; 27 (ii) if the recipient discontinues operations at the specific project 28 site during the first five years of the term of the development assist- 29 ance agreement, the recipient shall forfeit all credits taken by the 30 recipient during such five year period; and (iii) in the event of a 31 revocation or suspension of the credit, the department shall initiate 32 proceedings against the recipient to recover wrongfully exempted state 33 income taxes and the recipient shall promptly repay to the department 34 any wrongfully exempted state income taxes. The forfeited amount of 35 credits shall be deemed assessed on the date the department initiates 36 proceedings against such recipient and the recipient shall promptly 37 repay to the department any wrongfully exempted state income taxes. 38 2. The commissioner of taxation and finance may elect to waive 39 enforcement of any contractual provision arising out of the development 40 assistance agreement required by this article based on a finding that 41 the waiver is necessary to avert an imminent and demonstrable hardship 42 to the recipient that may result in such recipient's insolvency or 43 discharge of workers. If a waiver is granted, the recipient shall agree 44 to a contractual modification, including recapture provisions, to the 45 development assistance agreement. The existence of any waiver granted 46 pursuant to subdivision three of this section, the date of the granting 47 of such waiver, and a brief summary of the reasons supporting the grant- 48 ing of such waiver shall be disclosed consistent with the provisions of 49 this section. 50 3. Beginning June first, two thousand eighteen, the department shall 51 annually compile a report on the outcomes and effectiveness of recapture 52 provisions by program, including but not limited to: (a) the total 53 number of authorities that receive development assistance as defined in 54 this article; (b) the total number of recipients in violation of devel- 55 opment agreements with the department; (c) the total number of completed 56 recapture efforts; (d) the total number of recapture efforts initiated;S. 3364--A 12 1 and (e) the number of waivers granted. Such report shall be disclosed 2 consistent with the provisions of section thirty-nine hundred eighty- 3 three of this article. 4 § 4. This act shall take effect on the one hundred twentieth day after 5 it shall have become a law and shall apply to contracts and agreements 6 entered into on or after such effective date. Effective immediately, 7 the addition, amendment and/or repeal of any rule or regulation neces- 8 sary for the implementation of this act on its effective date are 9 authorized to be made on or before such effective date.