Skip to main content
Premium Trial:

Request an Annual Quote

$3M NYC Biotech Tax Credit Passes State Assembly; Stalemate Threatens Bill in State Senate

Premium

This is an updated version of a story originally posted on June 18.

A bill allowing New York City to award up to $3 million in tax credits to early-stage biotechnology companies that promise to relocate to, or expand within, the Big Apple passed the the state Assembly unanimously on Wednesday.

However, the bill's fate was left in limbo in the state Senate, where a week-old stalemate over leadership is poised to halt progress on that and other pending legislation.

"Right now, all bets are off," Assembly Member Mark Weprin (D-Little Neck) told BioRegion News on Thursday. "I assume that since it passed the assembly unanimously, eventually the Senate will do some business, and since there's no known opposition to this, we will get it passed. But I've stopped guessing what's going to happen in the Senate."

New York City, Weprin said, wrote the tax credit into its budget for the fiscal year starting July 1, on the assumption that it would pass both houses of the state Legislature.

Assembly Bill 8131, introduced May 5, allows the New York City Department of Finance to award 100 percent of tax credits up to $250,000 per calendar year to biotech companies that grow their workforces by at least 5 percent above the number for the year they were approved for the tax credit.

That level, or "tier," of tax credit also applies to companies "that are newly established, newly relocated, or did not have any employees in the year prior to which the credit is claimed."

Companies that increase their payroll by less than 5 percent can only receive a maximum 50 percent of the maximum amount of the credit, up to $125,000. Firms in academic incubators are not eligible for the 50-percent credit.

Those stipulations make the bill different from the state's existing Qualified Emerging Technologies, Facilities, Operations, and Training Credit, set to expire Jan. 1, 2012.

Weprin — a candiate for the City Council seat being vacated by his brother David Weprin (D-Hollis), who is now running for city comptroller — joined with City Council Speaker Christine Quinn in announcing the bill last month.

Beyond individual companies that stand to benefit from it, the new tax credit is aimed to help New York City retain startups and grow its own biocluster. That effort, in turn, is part of a broader economic-development push by Mayor Michael Bloomberg to broaden the city's economy beyond Wall Street and the financial services sector [BRN, May 15; Feb. 23]. Bloomberg is seeking re-election this year.

"The credit will help a young firm equip a lab, train technicians, and fund access to high tech equipment that they do not own," according to an Assembly memorandum in support of the bill.

The tax credit program would run for three consecutive years beginning in January 2010. The memorandum includes an estimate from the New York City Council Finance Division that without a cap on total credits, the credit would cost the city approximately $2 million in the city's 2011 fiscal year, which starts July 1, 2010, and would rise to approximately $3 million by NYC FY 2013.

The bill was among 75 acted on by the Assembly on Wednesday, Speaker Sheldon Silver (D-Manhattan) announced.

In the state Senate, the companion Senate Bill 4845-B, which can be found here introduced by state Sen. Tom Duane (D-Manhattan), cleared the Energy and Telecommunications committee, then advanced as far as a second reading on the chamber's calendar on June 8.

That coincided with the day when two Democratic state Senators, Pedro Espada and Hiram Monserrate, broke ranks with the Democratic majority and aligned themselves with Republicans, thereby overthrowing Majority Leader Malcolm Smith (D-Queens).

Monserrate is from Queens; Espada represents a Bronx district, but also has a residence in the New York City suburb of Mamaroneck, NY.

State Supreme Court Justice Thomas McNamara on Tuesday refused a request by Democrats to intervene in the dispute and reverse the June 8 seizure of state Senate leadership. By then, Monserrate returned to the Democratic fold, though Espada remains allied with the GOP. The result is a 31-31 deadlock that has stopped action on bills, and nearly all other state Senate business.

The Scan

Billions for Antivirals

The US is putting $3.2 billion toward a program to develop antivirals to treat COVID-19 in its early stages, the Wall Street Journal reports.

NFT of the Web

Tim Berners-Lee, who developed the World Wide Web, is auctioning its original source code as a non-fungible token, Reuters reports.

23andMe on the Nasdaq

23andMe's shares rose more than 20 percent following its merger with a special purpose acquisition company, as GenomeWeb has reported.

Science Papers Present GWAS of Brain Structure, System for Controlled Gene Transfer

In Science this week: genome-wide association study ties variants to white matter stricture in the brain, and more.