Tax Credit Deferral

Date: 2011

 MEMORANDUM IN OPPOSITION


Unshackle Upstate, a bipartisan coalition representing more than 70,000 employers with upwards of 1.5 million workers oppose the deferral of use of payment of certain tax credits as proposed by Governor Paterson. This proposal would include a new section in tax law that would require the deferral of fifty (50) percent of specific business tax credits for tax years 2010, 2011 and 2012.


Specifically, the proposed changes would provide the Commissioner of the Department of Taxation and Finance to defer fifty (50) percent of the amount of the specified tax credits that would otherwise be used or refunded through 2012 from the following credits:
 

Alternative Fuels Credit
Credit for Employment of Persons with Disabilities
Special Additional Mortgage Recording Tax Credit
Investment Tax Credit
Rehabilitation of Historic Properties Credit
Companies who Provide Transportation to Individuals with Disabilities
Clean Heating Fuel Credit
Biofuel Production Credit
Empire State Commercial Production
Conservation Easement tax credit
Purchase of an Automated External Defibrillator
Fuel Cell Electric Generating Equipment Expenditures
EZ Wage tax credit
EZ Capital Tax credit
EZ ITC
EZ EIC
Employment Incentive credit
QEZE Tax reduction Credit
QEZE Credit on Real Property Tax
Brownfield Redevelopment Tax credit
Remediated Brownfield Real Property Taxes for Qualified Sites
Environmental Remediation Insurance Credit
Security Training tax credit
QETC Facilities Operations and Training Credit
QETC Employment Credit


QETC Capital Tax credit
Low Income Housing Credit
Green Building Credit
Credit for servicing certain mortgages
Historic Homeownership Rehabilitation
Solar Energy System Equipment credit
CAPCO Credit
Power for Jobs Credit

This proposal advanced by Governor Paterson would slow any economic recovery, as it will once again demonstrate to job creators looking to invest, that New York does not keep its promises to the business community. Taxpayers and job creators that have made investments in New York State through the installation of solar arrays, providing transportation to individuals with disabilities, restoring brownfields, hiring additional employees, or expanding their operations are now going to be told that the State of New York is going to renege on its share of that investment. When the trust with the investment communities is broken it cannot be restored with a few kind words about job creation and the innovation economy. Taxpayer and job creators are literally banking on those credits, when they don't materials economic projects and jobs will be placed in jeopardy.
 

In fact, the governor’s proposal is nothing more than a hidden business tax increase — individual businesses will pay more in taxes than they would under current law. Unshackle Upstate is committed through its Judgment Day efforts to make legislators and the public aware that the people of New York can not support additional taxes, fees, borrowing and labor mandates.


Unshackle Upstate has offered - and will continue to offer - solutions to the state's fiscal problems, that including current year proposals, would provide for $12 billion in state savings. The coalition understands that this cannot occur overnight, and cannot occur without some shared pain. However, lawmakers and the governor must respect the rights of New York's largest special interest group: the taxpayers.
In general, Unshackle Upstate supports:


Holding school aid and Medicaid spending flat;
Consolidating both large and small government agencies and functions;
Identifying ways to use state resources to stimulate private sector job growth;
Enacting permanent structural reforms (not one-offs or cuts only); and
Enacting reforms highlighted in the final report of both the Suozzi and Lundine Commissions

For these reasons, Unshackle Upstate strongly encourages the Assembly and the Senate to reject this onerous burden in the Enacted State Budget.