Summary of Bill S 1093

Bill Number: S 1093

Title: Prohibits federal corporate bailout recipients who engage in stock buybacks from receiving New York state tax credits

Status: Referred to Budget and Revenue

Introduced: January 08, 2025

Classification: Bill

Purpose and Intent

Bill S 1093 aims to restrict New York state tax credits for corporations that have received federal bailouts and subsequently engage in stock buyback activities. The intent of this legislation is to discourage companies from prioritizing stock buybacks over reinvestment in their workforce and operations, particularly after benefiting from taxpayer-funded bailouts.

Key Provisions

• Prohibition of Tax Credits: The bill specifically prohibits any corporation that has received federal bailout funds from claiming New York state tax credits if they engage in stock buybacks.
• Definition of Stock Buybacks: The bill defines stock buybacks as the repurchase of shares by the issuing company, which can inflate stock prices but does not contribute to job creation or economic growth.
• Eligibility Criteria: Corporations that have received federal assistance must demonstrate compliance with the provisions of this bill to qualify for any state tax credits.

Affected Parties

• Corporations: The primary entities affected by this bill are corporations that have received federal bailouts. They will need to reconsider their financial strategies regarding stock buybacks if they wish to retain eligibility for state tax credits.
• State Revenue: The bill may impact state revenue by potentially reducing the number of tax credits claimed by corporations that engage in stock buybacks.
• Workers and Communities: The legislation is designed to benefit workers and local communities by encouraging corporations to invest in job creation and operational improvements rather than stock price manipulation.

Procedural Aspects

• Legislative Action: As of January 8, 2025, the bill has been referred to the Budget and Revenue Committee for further consideration.
• Related Legislation: This bill is related to prior-session bills S 8230, S 2756, and S 1742, which may address similar issues regarding corporate accountability and state tax incentives.

Conclusion

Bill S 1093 represents a significant step towards holding corporations accountable for their financial practices, especially in the context of federal assistance. By linking state tax credits to corporate behavior, the legislation seeks to promote responsible investment in the economy and discourage practices that may undermine long-term economic stability.