A.9021 (Rules/Silver)



A.9021 (Rules/Silver)


Empire Zones



The Business Council opposes this legislation because it place excessive restrictions on the Empire Zone program, including overly restrictive limits on the designation of Empire Zones, and onerous criteria for the decertification of zone certified businesses. While The Business Council agrees that some program reforms are necessary, and should be part of any legislation to extend the Zones program, this legislation would have adverse impacts on this key state economic development program.

Specific issues of concern to The Business Council include the following:

  • We disagree with the proposal that all existing and future Empire Zones designate their zone acreage within no more than three distinct contiguous areas. This proposal is inconsistent with economic development needs of many areas of the state, especially in upstate rural counties. The Business Council believes that the EZ program can serve both urban redevelopment and general state economic development needs. This specific proposal is proposing a urban settings-based, one-size fits all approach to designating Zone areas.

  • Defining distressed areas as those with job growth at least 2% below the state average over a three year period is too restrictive, given that job growth in most areas of the state and most counties continue to lag behind national averages. In short, compared to national economic performance, most areas of New York are “distressed” when measured on a job growth basis, and would benefit from the economic incentives provided under the Empire Zone program.

  • We disagree that Zone certified businesses should be decertified if they fail to qualify for tax benefits in any given year. As currently structured, the Zone program bases program certification (and benefit eligibility) on projections of job growth and/or investments by an individual business. However, actual tax benefits are based on actual job growth and/or investments in any given tax year. If a business falls below its required employment count for a specific tax year, for example, they would not receive QEZE benefits for that year; however, they would remain program certified, and could claim QEZE credits in subsequent years if their job count again rises above their base period. We see no significant program benefit to automatically decertifying these businesses.

  • We disagree with program eligibility criteria that would require that businesses comply with not only the substance but also the “spirit of” the Empire Zone legislation. It would be difficult if not impossible for a business to be assured that it is complying with this vague criteria, thereby adding significant uncertainty to benefit eligibility criteria.

For these reasons, The Business Council respectfully opposes approval of A.9021.