Relates to restricting the use of economic development funds to business entities where the CEO of such business entity earns a salary which is 25 times greater than that of the lowest paid employee.
NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A6231
SPONSOR: Glick TITLE OF BILL:
An act to amend the economic development law and the New York state
urban development corporation act, in relation to limiting the use of
economic development funds to certain corporations
PURPOSE OR GENERAL IDEA OF BILL:
Relates to limiting the use of economic development funds to certain
corporations.
SUMMARY OF SPECIFIC PROVISIONS:
Section 1. The economic development law is amended by adding a new
section 107 to limit funding, such as loans and grants, to those compa-
nies who pay their chief executive officers no more than twenty-five
times that of the lowest paid employee's salary. Part time worker sala-
ries will be determined on a prorated basis. This shall be determined
via the commissioner's review of all payroll records of those requesting
economic development funds.
Section 2. Section 1 of chapter 174 of the laws of 1968, constituting
the New York stat urban development corporation act, is amended by
adding a new section 5-a. to limit funding, such as loans and grants, to
those companies who pay their chief executive officers no more than
twenty-five times that of the lowest paid employee's salary. Part time
worker salaries will be determined on a prorated basis. This shall be
determined via the commissioner's review of all payroll records of those
requesting economic development funds.
JUSTIFICATION:
In this time of excessive spending on executive compensation and vast
income disparities, this act would dispense economic development funds
to companies that have a more balanced salary ratio and could serve to
increase baseline salaries.
PRIOR LEGISLATIVE HISTORY:
2007-08: A6808 referred to Economic Development
2009-10: A3099 Referred to Economic Development, held for consideration
in Economic Development.
2011-2012: A3503 Referred to Economic Development, Held for consider-
ation in Economic Development.
2013-14: Held for consideration in Economic Development.
STATE OF NEW YORK
________________________________________________________________________
6231
2023-2024 Regular Sessions
IN ASSEMBLY
April 3, 2023
___________
Introduced by M. of A. GLICK -- read once and referred to the Committee
on Economic Development
AN ACT to amend the economic development law and the New York state
urban development corporation act, in relation to limiting the use of
economic development funds to certain corporations
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. The economic development law is amended by adding a new
2 section 107 to read as follows:
3 § 107. Restrictions on economic development funding to certain corpo-
4 rations. No economic development loans, grants or other funds may be
5 provided under the provisions of this chapter to any person, firm, part-
6 nership or corporation where the chief executive officer of such busi-
7 ness entity receives a salary, including all remuneration, bonuses,
8 stock and benefits, which is more than twenty-five times the amount of
9 the salary of the lowest paid employee of such business entity. The
10 salary of any part time employee shall be determined on a prorated
11 basis, and calculated as if such employee was employed full time. The
12 commissioner shall request and examine the payroll records and any other
13 records of any business entity which receives or applies for any loan,
14 grant or economic development funding under this chapter which are
15 necessary to determine the salary amounts pursuant to this section.
16 § 2. Section 1 of chapter 174 of the laws of 1968, constituting the
17 New York state urban development corporation act, is amended by adding a
18 new section 5-a to read as follows:
19 § 5-a. Restrictions on economic development funding to certain corpo-
20 rations. No economic development loans, grants or other funds may be
21 provided under the provisions of this act to any person, firm, partner-
22 ship or corporation where the chief executive officer of such business
23 entity receives a salary, including all remuneration, bonuses, stock and
24 benefits, which is more than twenty-five times the amount of the salary
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD09304-01-3
A. 6231 2
1 of the lowest paid employee of such business entity. The salary of any
2 part time employee shall be determined on a prorated basis, and calcu-
3 lated as if such employee was employed full time. The board of directors
4 of the corporation shall request and examine the payroll records and any
5 other records of any business entity which receives or applies for any
6 loan, grant or economic development funding under this act which are
7 necessary to determine the salary amounts pursuant to this section.
8 § 3. This act shall take effect on the first of January next succeed-
9 ing the date on which it shall have become a law.
