New York State’s motto is “Excelsior” or Ever Upwards. We like it! Unfortunately, when it comes to economic development, Governor Hochul’s budget wants to take New York completely backwards. Here is a short list of the Parade of Horribles. For our full rapid reaction, head over to our website.
- A 55% increase in the film tax credit, from $420 million to $700 million a year. The film tax break is the perfect race to the bottom: lawmakers are convinced that if they don’t offer it, film companies will flee to other states, which completely ignores everything we know about how business subsidies don’t work.
- Resuscitating the utterly failed and dead Start-Up NY program. EPIC, the Extended Prosperity and Innovation Campuses program, is plain dumb and ignores everything learned about why Start-Up NY failed. The program would allow businesses to operate tax-free for 10 years on or near university or college campuses.
- Creating the Affordable Housing from Commercial Conversions Tax Incentive Benefits (AHCC) program, which will provide a tax break to developers in New York City who convert a commercial, manufacturing, or other non-residential building to residential use. Why does Albany love messing with NYC’s tax base so much?
- Extending 421-a to allow developers more time to finish their buildings and still qualify for the credit. Under current law, to be eligible for a 421-a tax credit, construction must be completed by June 16, 2026. The state is proposing to extend the completion deadline to June 15, 2030, giving developers more time to finish their projects and still get the lucrative subsidy.
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New York Corporate Welfare This Week
- New bills chip away at IDAs’ most egregious practices. The Investigative Post reports on two bills coming down the pike: One will ban Industrial Development Agencies from abating taxes that fund schools, and the other would require that IDAs get a special analysis if they want to give taxpayer dollars to retail establishments. Handing out subsidies to retail establishments is technically already banned except in special cases. And you can guess how often there are special cases!
- The proposal change to 421-a would be a victory for developers. The Real Deal explains the extension of 421-a.
- The expansion of the film tax credit is turning heads. The NY Post investigates the number of Hollywood donors who give generously to Hochul (featuring our John Kaehny!), while Crain’s explains that actually, NYS is afraid all the film shoot crews will flee to Georgia (?!).
- The microchip industry continues to cut jobs and production. “Green” CHIPS recipient Micron, which is slated to develop near Syracuse in exchange for massive tax dollars, is…not doing well. Who knows if they’ll actually build anything. But hey, at least Hochul and Schumer got their victory lap!
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Fun fact: Governor Hochul wants the NYS Thruway Authority to loan $455 million to the already state subsidized Belmont horse race track for renovations.
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