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A03718 Summary:

BILL NOA03718
 
SAME ASNo Same As
 
SPONSORKim
 
COSPNSRSteck, Cahill, Abinanti
 
MLTSPNSR
 
Add Art 17 §250, St Fin L
 
Establishes an interstate compact agreement to phase out corporate giveaways which prohibits member states from offering or providing any company-specific tax incentive or company-specific grant to any entity for a corporate headquarters, manufacturing facility, office space or other real estate development located in any other member state as an inducement for the corporate headquarters, manufacturing facility, office space or other real estate development to relocate to the offering member state.
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A03718 Text:



 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                          3718
 
                               2021-2022 Regular Sessions
 
                   IN ASSEMBLY
 
                                    January 28, 2021
                                       ___________
 
        Introduced  by  M.  of  A. KIM, STECK, CAHILL, ABINANTI -- read once and
          referred to the Committee on Economic Development
 
        AN ACT to amend the state finance law, in relation  to  establishing  an
          interstate compact agreement to phase out corporate giveaways
 
          The  People of the State of New York, represented in Senate and Assem-
        bly, do enact as follows:
 
     1    Section 1. The state finance law is amended by adding a new article 17
     2  to read as follows:
     3                                 ARTICLE 17
     4             INTERSTATE COMPACT AGREEMENT TO PHASE OUT CORPORATE
     5                                  GIVEAWAYS
     6  Section 250. Interstate compact agreement to phase out  corporate  give-
     7                 aways.
     8    § 250. Interstate  compact agreement to phase out corporate giveaways.
     9  This act shall be known and may be cited as the "agreement to phase  out
    10  corporate giveaways act".
    11    Article 1. Membership. Any state of the United States and the District
    12  of  Columbia may become a member of this compact by enacting this agree-
    13  ment in substantially the following form.
    14    Article 2. Definitions. As used in this compact,  unless  the  context
    15  clearly  indicates otherwise, the following terms shall have the follow-
    16  ing meanings:
    17    a. "Corporate giveaway" means any company-specific or industry-specif-
    18  ic disbursement of funds via property, cash or deferred or  reduced  tax
    19  liability  by  a  state  or  local government to a particular company or
    20  industry.
    21    b. "Member state" means any state or the District of Columbia that has
    22  enacted a statute agreeing to this compact.
    23    c. "Company-specific tax incentive" is any change in the  general  tax
    24  rate or valuation offered or presented to a specific company that is not
    25  available to other similarly-situated companies.
 
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD05950-01-1

        A. 3718                             2
 
     1    d. "Company-specific grant" is any disbursement of funds via property,
     2  cash  or  deferred  tax  liability by the state or local government to a
     3  particular company.
     4    e.  "Located  in any other member state" means any corporate headquar-
     5  ters, office space, manufacturing facility or other real estate develop-
     6  ment that is physically located in another member state, whether or  not
     7  the company has other property in the member state.
     8    Article 3. Findings. The member states find that:
     9    a.  Corporate giveaways are among the least effective uses of taxpayer
    10  dollars to create and maintain jobs;
    11    b. Local and state leaders are in a prisoners'  dilemma  where  it  is
    12  best  for  all to create a level playing field for all employers without
    13  any corporate giveaways, but each level of government has  an  incentive
    14  to subsidize a company, generating a race to the bottom;
    15    c.  Governments  should  attract and retain companies based on general
    16  conditions (including but  not  limited  to  modern  infrastructure,  an
    17  educated workforce, a clean environment, and a favorable tax and regula-
    18  tory  climate), not based on a specific grant for a particular company;
    19    d.  Corporate  giveaways  fuel business inequality as only the largest
    20  businesses receive the vast majority of these funds;
    21    e. A reasonable first step in phasing out corporate  giveaways  is  an
    22  anti-poaching agreement among state governments prohibiting state compa-
    23  ny-specific  tax  incentives  and  state  company-specific  grants as an
    24  inducement for entities to relocate existing facilities;
    25    f. Creating a national board of gubernatorial appointees charged  with
    26  finding  consensus  around improvements to this agreement over time in a
    27  phased approach will assist state and local governments in escaping from
    28  the prisoners' dilemma and implementing a level playing  field  for  all
    29  employers.
    30    Article  4. Anti-poaching prohibition. Each member state is prohibited
    31  from offering or providing any company-specific tax incentive or  compa-
    32  ny-specific  grant  to any entity for a corporate headquarters, manufac-
    33  turing facility, office space or other real estate  development  located
    34  in  any  other member state as an inducement for the corporate headquar-
    35  ters, manufacturing facility, office space or other real estate develop-
    36  ment to relocate to the offering member state.
    37    Article 5. Exclusions. Workforce development grants that train employ-
    38  ees are not subject to this agreement. Company-specific  tax  incentives
    39  or  company-specific  grants  from  local governments are not subject to
    40  this agreement. State company-specific tax incentives or state  company-
    41  specific  grants  to  entities for corporate headquarters, office space,
    42  manufacturing facilities or real estate developments located within  its
    43  own state are not subject to this agreement.
    44    Article  6. Withdrawal. Any member state may withdraw from this agree-
    45  ment with six months' notice and shall do so in  writing  to  the  chief
    46  executive officer of every other member state to the agreement.
    47    Article  7.  Enforcement. a. The chief law enforcement officer of each
    48  member state shall enforce this compact.
    49    b. A taxpaying resident of any member state has standing in the courts
    50  of any member state to require the chief law enforcement officer of that
    51  member state to enforce this compact.
    52    Article 8. National board to draft suggested improvements over time to
    53  the agreement. A national board of the agreement to phase out  corporate
    54  giveaways  act  is  established  by this agreement. Each chief executive
    55  officer of each member state shall appoint one member to the board.  The
    56  board  shall  accept  appointees  from  non-member  states  that wish to

        A. 3718                             3
 
     1  appoint a member of the board. The purpose of the board  is  to  publish
     2  suggested  revisions  to  this  agreement  in  December of every year to
     3  continue to phase out those forms of corporate giveaways that the  board
     4  finds  reasonable to include as suggested revisions to the agreement for
     5  member states to consider implementing.   The  board  shall  convene  at
     6  least  annually, elect officers from its membership, establish rules and
     7  procedures for its governance and publish a report in December of  every
     8  year  that  includes suggested revisions and improvements to this agree-
     9  ment. The board shall collect testimony  from  all  interested  parties,
    10  including organizations and associations representing state legislators,
    11  taxpayers  and  subject  matter  experts  on  how  the  agreement can be
    12  improved and strengthened.
    13    Article 9. Construction and severability. This compact shall be liber-
    14  ally construed so as to effectuate its purposes. If any phrase,  clause,
    15  sentence  or  provision  of  this  compact,  or the applicability of any
    16  phrase, clause, sentence or provision of this compact to any government,
    17  agency, person or circumstance is declared in  a  final  judgment  by  a
    18  court  of  competent  jurisdiction to be contrary to the constitution of
    19  the United States or is otherwise held  invalid,  the  validity  of  the
    20  remainder of this compact and the applicability of the remainder of this
    21  compact  to  any government, agency, person or circumstance shall not be
    22  affected.
    23    If this compact is held to be contrary  to  the  constitution  of  any
    24  member  state,  the  compact shall remain in full force and effect as to
    25  the remaining member states and in full  force  and  effect  as  to  the
    26  affected member state as to all severable matters.
    27    §  2.  This  act shall take effect upon the adoption of the interstate
    28  compact agreement to phase  out  corporate  giveaways  by  two  or  more
    29  states;  and  provided  further that the comptroller of the state of New
    30  York shall notify the legislative  bill  drafting  commission  upon  the
    31  occurrence of such adoption of the interstate compact agreement to phase
    32  out  corporate giveaways by two or more states in order that the commis-
    33  sion may maintain an accurate and timely  effective  data  base  of  the
    34  official  text  of  the  laws of the State of New York in furtherance of
    35  effecting the provisions of  section  44  of  the  legislative  law  and
    36  section 70-b of the public officers law.
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