Legislative actions of interest to business incubators

Several recent legislative actions early this year have implications for incubators and their tenant/clients.

The state Senate passed with bipartisan support the "Upstate NOW" package (S05953 sponsored by Sen. Bruno with numerous cosponsors). This long and complex bill includes authorization of assistance grants for incubators as part of regional economic-development partnerships; a proposed sales tax exemption for equipment purchased by companies located in certain incubators; certain preferences under the Qualified Emerging Technology Company tax credit for incubator graduates; and establishment of a "virtual incubator" program serving rural areas and agricultural or food businesses.

The Upstate NOW package will serve as a counterpart and negotiating position for the Senate with respect to the Administration's Executive Budget for economic development, which also referenced incubation. It was sent to the Assembly and referred to the Ways and Means Committee. Language which in previous sessions referred narrowly and unclearly to "academic incubators" has been clarified and broadened in parts of the bill to include other incubators "funded by the state."

S3430, sponsored by Sen. Skelos with several cosponsors, was returned to the Senate in early January after dying in the Assembly. It would remove the sunset on the QETC "facilities, operations and training credit" and increase the amount of the credit.

Also in January, Assemblyman Schimminger introduced A03022 (also with cosponsors), which was referred to the Ways and Means Committee. It allows companies still in the development stage to trade unused net operating losses and R&D tax credits to profitable companies that can use them to offset taxes owed. This bill, which would be welcomed by many incubator-stage companies, is a re-introduction of legislation introduced every session since 1999-2000.