by Andrew Henderson

Three Fulton businesses and 10 Oswego businesses are being eliminated from their respective Empire Zones and will lose the accompanying benefits.

The state is mailing letters to more than 8,000 businesses that are currently located in Empire Zones around the state. The vast majority of them—roughly 6,400—will continue to receive the Empire Zone benefits while more than 600 will be notified that they will lose the benefits.

There are two Empire Zones in Oswego County. They are located in the cities of Fulton and Oswego.

In Fulton, PAR-K Properties of Fulton, Pioneer Fulton Shopping Center, and Macabe Family Development are slated to lose their benefits. In Oswego, E.J. Spirtas Group, Wal-Mart Stores East, Compass Federal Credit Union, Panos Enterprises of West Oswego, Inc. d/b/a McDonald’s, Oswego Harbor Power, NRG Energy, and Bond, Schoeneck & King are slated to lose their benefits.

These businesses received a letter from Randal Coburn, director of the Empire Zones program, stating that they did not meet the qualifications to receive the benefits.

“Certain statutory reforms to the Empire Zones Program were enacted as part of the 2009-2010 state budget,” Coburn wrote. “The reforms require that Empire State Development review all existing Empire Zone certified businesses to verify that they qualify for continued participation in the program based on the new statutory requirements.

“Specifically, Empire State Development must review businesses to determine whether, if certified prior to August 1, 2002, a business restructured and transferred employees or property from one business to another in order to maximize their Empire Zone benefits, or whether a business is providing economic returns to the state that exceed the tax benefits it is receiving,” he added. “Based on our initial review of your business, it appears your business does not meet the qualification for continued certification.”

Coburn noted in the letter that the Empire State Development will be mailing additional information by no later than June 19 to provide details on its findings and explain the process for appealing any decisions.

Empire Zone certified businesses receive several benefits, including:

• Wage Tax Credit, available to companies hiring full-time or full-time equivalent employees in the zone. Credits are available for up to five consecutive years. Credits are $1,500 per employee; for employees in special targeted groups the amount is raised to $3,000 per employee per year. In investment zones, this credit is increased by $500 for workers with wages over $40,000. Unused credits can be forwarded indefinitely and new businesses (those that have been taxable for five years or less) are eligible for a 50 percent refund of unused credits.

• Investment Tax Credit, available to companies making an investment in the zone for depreciable property and/or equipment that is principally used in manufacturing, processing, assembly, industrial waste treatment, or air pollution-control facilities; R&D; or financial institutions. Ten percent (8 percent for personal income tax filers) of the eligible investment can be taken for credit. Unused credits can be forwarded indefinitely and new businesses are eligible for a 50 percent refund of unused credits.

• An additional Employment Incentive Credit equal to 30 percent of the investment tax credit is available for each of the three years after the Investment Tax Credit is claimed if employment is increased when the investment is made. Unused credits can be forwarded indefinitely and new businesses (personal income tax only) are eligible for a 50 percent refund of unused credits.

• Zone Capital Credits, a 25-percent tax credit available for personal or corporate income tax payers for eligible investments in certified zone businesses, or contributions to approved community development projects. There is a lifetime limit of $100,000 in zone capital credits per contributor for Community Development Projects and $100,000 lifetime limit in zone capital credits per investor in a Direct Equity Investment project.

• New York State Sales Tax Refund, refund of the state portion of the sales tax available for the purchase of building materials used in the construction or renovation of industrial or commercial property located in a zone. Empire Zone certification is not a requirement to receive this benefit; however, the purchaser must be buying for a property in the zone.

Assemblyman Will Barclay expressed his disappointment over the anticipated removal of the more than 100 businesses from central New York.

“It is amazing to me that during a time when our upstate businesses are struggling, Albany passes a budget that will raise taxes, health-care premiums, and energy costs,” said Assemblyman Barclay. “Then, under the auspices of ‘reform,’ guts the one state economic-development program—New York State Empire Zone Program—that is designed to combat some of these costs.

“It is shocking that some of our biggest employers in the region—Harden Furniture, Anaren Microwave, Welch Allen, Crucible Specialty Metals. and others—will be losing their Empire Zone benefits,” the assemblyman added. “I guess this is New York’s way of saying thanks to these manufacturers who have so long labored under New York’s repressive business climate. I urge the governor and my colleagues in the legislature to join with me in passing legislation to reverse this misguided policy.”

Some of the other businesses in the Fulton Empire Zone include Huhtamaki, Birdseye, New York Chocolate and Confections Company, the former Fulton Builders Supply site, Tom Mirabito’s Big M market, Erie Hydro Power, Byrne Dairy located on Route 3, Holly Drive Motel, the Watertower Hill area, D-K Manufacturing, State Street–Hughes Building, and the Oak Street Senior Housing.