New York Gov. Andrew Cuomo and state legislative leaders on Wednesday announced an agreement on legislation that allows the Tax-Free NY program to move forward.
The bill is officially known as START-UP NY (the SUNY Tax-free Areas to Revitalize and Transform Upstate NY).
SUNY is short for State University of New York.
START-UP NY is intended to foster entrepreneurialism and job creation by enticing companies to bring their ventures to upstate New York and partner with colleges and universities.
The program offers new businesses the opportunity to operate completely tax-free for 10 years — including no income tax for employees, no sales, property, or business tax — in specified zones on college campuses while also partnering with the institutions in the SUNY system and selected private colleges.
In order to locate into a START-UP NY tax-free zone, a business will need to be aligned with or further the academic mission of a given campus, college, or university that is sponsoring the tax-free zone.
Eligible companies must also either be a startup, relocating to New York, or an expansion of an existing New York company, according to the proposal.
Every business must create and maintain net new jobs in order to participate.
Employees in participating companies will pay no income taxes for the first five years. For the second five years, employees will pay no taxes on income up to $200,000 of wages for individuals, $250,000 for a head of household, and $300,000 for taxpayers filing a joint return.
The number of net new jobs eligible for personal income-tax benefits will not exceed 10,000 new jobs per year, according to the governor’s office.
All SUNY schools are eligible to take part using vacant campus land or campus-building space, or any incubator with a “bona fide” affiliation to the school, the governor’s office said.
In addition, the program also provides 3 million square feet (with the potential of another 600,000 more) of tax-free areas primarily dedicated to private colleges and universities on land north of Westchester County, to be allocated by the START-UP NY program board “in a manner that ensures regional balance and balance among eligible rural, urban, and suburban areas in the state,” according to the proposal.
State leaders, including Cuomo and Assembly Speaker Sheldon Silver, will appoint the three members of that board. The members will have “significant” experience in academic-based entrepreneurship, the governor’s office said.
State lawmakers will consider the legislation as the current legislative session draws to a close.
Contact Reinhardt at ereinhardt@cnybj.com