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S 10100

Relates to reforming the industrial development authority program and adding a tax clearance process

2025 Regular Session Introduced by Liz Krueger

Requires tax clearances for IDA projects and tight oversight to ensure tax compliance, transparency, and accountability of exemptions.

REFERRED TO LOCAL GOVERNMENT
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Bill Summary · S 10100

Summary of Bill S.10100 (2025-2026) – New York

Jurisdiction: New York
Session: 2025-2026
Committee: Local Government
Sponsor: Sen. Krueger (Co-sponsor: Liz Krueger)
Title: Relates to reforming the industrial development authority program and adding a tax clearance process

Date Introduced: April 28, 2026

1) Purpose and Intent

  • Reform the state’s industrial development authority (IDA) program, enhancing oversight, accountability, and alignment with tax-exemption practices.
  • Introduce a formal tax clearance process to ensure that entities receiving IDA tax exemptions meet tax compliance requirements.
  • Strengthen reporting, auditing, public transparency, and governances standards for IDAs and related authorities.

2) Key Provisions and Changes

A. General Municipal Law (IDA-related provisions)

  • Redefined terms and clarified references for “State sales and use taxes,” “State taxes,” “IDA,” “Commissioner,” “ABO” (Authorities Budget Office), and “PACB” (Public Authorities Control Board).
  • IDAs must maintain records of state/local tax exemption benefits granted to each project and agent/project operator; provide records to the Commissioner upon request.
  • Within 30 days of providing financial assistance with state tax exemption benefits, an IDA must report the project, the amount of benefits, and other prescribed details to the Commissioner. Noncompliance can bar the IDA from granting state tax exemptions until compliant.
  • IDA resolutions and project documents must include terms and conditions requiring compliance by agents/project operators; IDAs must recover or recapture any improper or unauthorized tax exemption benefits.
  • If benefits are recovered, IDA must remit amounts to the Commissioner within 30 days and may be joined as a party in related actions. IDAs must file an annual compliance report detailing compliance efforts and targets, shared with multiple state offices.
  • Public disclosure requirements: IDAs must maintain a public website (free access) with resolutions, notices, meeting minutes, votes, project descriptions, and tax-exemption details. Data disclosed may be redacted only as permitted by the Public Officers Law.
  • Noncompliance by an IDA triggers ABO-driven corrective action; repeated failure can prevent the IDA from establishing projects or providing exemptions.

B. Compliance and Oversight Enhancements

  • Adds new open meetings law/Public Authorities Law compliance expectations for IDA members and officers.
  • Requires prior PACB approval for exemptions totaling or exceeding $5 million for a project (or increases/extends such exemptions), with detailed application requirements and timelines.
  • PACB must act within 45 days; if not acted upon, the application is deemed approved and disclosed on the IDA’s website.
  • PACB must assess whether exemptions would disproportionately advantage a project/operator compared with existing businesses; explicit prohibition on approvals where exemptions provide a competitive advantage.
  • For substantial exemptions, prior PACB approval is required for any increases/extensions if total tax benefits reach or exceed $5 million.

C. Tax Clearance Requirement

  • Adds a new requirement that, before an IDA can establish a project or provide financial assistance, it must obtain a tax clearance for every applicant, agent, project operator, and others required to collect tax, per Tax Law Sec. 171-x.

D. Public Authorities Budget Office and Related Authorities

  • Codifies the role and authority of the ABO to review and direct IDA compliance and can trigger consequences through PACB referrals.
  • Extends into the Public Authorities Law for consistency with the new accountability framework.

E. Tax Law – New Enforcement Mechanism

  • Enacts §171-x: Tax clearance enforcement to support delinquent tax liabilities.
    • Government entities can request tax clearances; the Department of Taxation and Finance (DTF) will assess past-due liabilities (thresholds may apply; default threshold is $500).
    • Clearances can be denied for past-due liabilities, missing returns, or failure to register when required.
    • Denials come with notice and opportunities to resolve deficiencies; challenges limited to specified grounds (e.g., not the correct taxpayer, satisfied liabilities, child support garnishments, etc.).
    • Clearances denial process includes protest options with defined timelines (60 days) through the Department of Tax Appeals.
    • Allows data sharing between government entities and DTF strictly for clearance purposes; prohibits broad redisclosure.
    • Clearances do not constrain other tax collection authorities unless specified.
    • Not applicable to the tax clearance requirement in §171-x (exemption-specific).

F. Effective Date

  • Effective immediately.
  • Applies to projects/agents/operators established on or after enactment; applies to amendments involving new or increased exemptions on or after enactment; and to tax-exemption-related recoveries from IDAs established after enactment.

3) Who/What is Affected

  • Industrial Development Agencies (IDAs) and industrial development authorities created under NY law.
  • IDA board members, officers, agents, project operators, and entities receiving state tax exemptions.
  • State agencies: Department of Taxation and Finance (DTF), Authorities Budget Office (ABO), Public Authorities Control Board (PACB), Department of Economic Development, and related municipal entities.
  • Public disclosures and online postings by IDAs.
  • Businesses seeking or currently receiving state tax exemptions tied to IDA projects.

4) Procedural and Timeline Aspects

  • PACB review window: 45 days to act on complete tax-exemption applications; if not acted, deemed approved.
  • 30-day reporting requirement to the Commissioner after implementing tax exemption benefits.
  • 30-day window for IDA to remit recovered exemptions or amounts to the Commissioner.
  • Public website data updates required within 30 days of changes.
  • Tax clearance denials trigger defined protest periods (60 days) and limited avenues for challenge.
  • Immediate effect upon enactment; broad application to new and existing IDA activities as described.

This bill would significantly enhance transparency, require tighter compliance with tax-related requirements, introduce a formal tax-clearance regime for IDA activities, and establish rigorous oversight of exemptions to prevent competitive distortions and ensure fiscal accountability.

Compiled from official sources — confirm details with the bill’s official record.

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