The Open for Business Act, sponsored by Bronx State Senator Jamaal Bailey and Assemblywoman Catalina Cruz of Queens, would provide tax incentives to businesses that employ local residents in full-time or part-time positions up to two years after the conclusion of a state disaster emergency.
If passed, the law would be administered by the state’s Department of Labor. According to DOL, more than 1.6 million New Yorkers have filed for unemployment, with $4.6 billion in benefits distributed in the last two months.
“New York’s workforce has been decimated by COVID-19,” Cruz said in a statement. “With almost two million people jobless and hundreds of thousands of businesses on the brink of closing, the financial impact will resonate across the state for years to come.
“We cannot sit back and allow our local workforce and small businesses, who make our communities what they are, to become lost to history,” she added.
To qualify for the tax incentive, a business must hire employees who meet specific requirements, such as residing within 50 miles of the company and previously losing employment due to the pandemic.
For the first six months for each qualified employee, a participating business would receive $750 per month for a full-time employee or $375 per month for a part-time employee who works at least 20 hours per week.
For the following six months, the tax credit would jump up to $1,500 for each full-time employee or $750 for part-time workers.
“Our bill would provide tax credits to small businesses and incentivize them to hire locally,” Bailey said in a statement. “The only way we can come out of the pandemic successfully is to come together as one, community and businesses working together to achieve a common goal.”
Last week, Cruz also teamed up with Manhattan State Senator Brad Hoylman to introduce the Commercial Lease Efficiency and Resolution (CLEAR) Path Forward Act, which would reduce commercial evictions and encourage tenants and landlords to renegotiate the terms of their leases outside of the courtroom.
Under current state law, a party to a commercial lease can excuse compliance where circumstances are beyond their control, according to the legislators. When Governor Andrew Cuomo ordered the shutdown of non-essential businesses, many small businesses were forced to close their doors, resulting in significant loss of revenue.
The CLEAR Path Forward Act would provide a roadmap for tenants and landlords to negotiate a settlement, prevent litigation and avoid evictions. If the parties cannot reach an agreement, the legislation would provide criteria for the court to evaluate where there should be a reduction of rent or a termination of the lease.
According to Hoylman, 89 percent of businesses in New York City have fewer than 20 employees. Those businesses are at the most risk during the COVID-19 pandemic, he said.
“No one wants New York City to be a place where only chain stores and outlet malls can survive,” he said.
Cruz added that her district, which includes Corona, Elmhurst and Jackson Heights, is the epicenter of the epicenter, so many local small businesses were forced to close for months. The majority of those businesses are immigrant owned, she noted.
“Prior to the epidemic, many of these small business owners were struggling to stay afloat as rent began to rise,” she said. “Now, with the state shutting them down, they are in danger of losing their only source of income and face mounting debt and possible eviction.”
The Queens lawmaker added that the legislation she is sponsoring would help these businesses stay open.
“This bill would ensure that these unforeseen circumstances are deemed legally beyond their control,” Cruz said.