START-UP NY
Procedure for Competition Analysis
January 31, 2014
Purpose:
The START-UP NY legislation requires campus applications for tax free status to “describe
whether or not the business competes with other businesses in the same community but
outside the Tax-free area” (See EDL §440). The Program regulations clarify this requirement by
specifying tasks to “ascertain that the business applicant will not compete with any other
business in the community but outside the Tax-Free NY area” (See 5 NYCRR 220.10(d)(4)(viii)).
These tasks include public notices to be done by the Sponsoring college or university
(“Sponsor”), an attestation by the applicant business, and a review of 6-digit NAICS codes of
businesses in the community. This memo outlines the efforts necessary to ascertain that, at the
time of application, the business would not compete with any other business in the same
community but outside the Tax-Free NY Area.
Business Application Attestation:
Business applicants must complete all sections of the Business Application, including Section 5
“Business Competitors.” The applicant must answer “Yes,” “No,” or “Unsure,” as to whether the
business competes with other businesses in the same community. By checking “No”, the
business attests that the applicant business will not compete with other businesses in the same
community, but outside the Tax-Free NY Area. Applicants that check “Yes,” must provide the
names and addresses of the businesses with whom the applicant business will be competing. A
business can check “Unsure” for any other reason including, but not limited to, where it has
insufficient information to select “Yes” or “No”, is unfamiliar with the community and with the
businesses in the area, or the business is genuinely unsure of whether it competes with other
businesses in the same community.
Procedure for NAICS Code Analysis:
a. Initiation
For the NAICS code analysis, the Sponsor will provide information to the New York State
Department of Labor, Division of Research and Statistics (DOL). Ideally the information provided
will include:
Full business name (including any DBAs) and
federal employer identification number (EIN)
Current full business mailing address
Proposed full business mailing address (for tax free status)
6-Digit NAICS code and a detailed description of the business product or service at the
proposed location (2012 NAICS codes can be found at
http://www.census.gov/eos/www/naics/)
Full contact information for the campus contact
Information will be sent by email to [email protected]
b. Analysis
DOL will search its official employment data, the Quarterly Census of Employment and Wages
(QCEW), for any existing companies classified with the same 6-digit NAICS in the proposed
business community, defined as the Census Tract containing the proposed business mailing
address and all contiguous Census Tracts.
c. Notification
If there are no existing company matches, DOL will email the campus and ESD
([email protected]) the 6-digit NAICS code searched and a statement indicating no
companies matched that 6-digit code.
If there are 1 or more existing company matches, DOL will email the campus the 6-digit NAICS
code searched and a statement indicating that at least 1 company matched that 6-digit code.
DOL will also email to ESD the 6-digit NAICS code searched and the identity and contact
information for any matching company or companies ([email protected]). ESD will
then review all information to support a final determination by the Commissioner of Economic
Development. (Note: ESD only is allowed access to confidential labor data per a Confidentiality
Agreement between ESD and DOL.)
Procedure for Public Posting:
a. Initiation
In advance of forwarding any business application to ESD, the Sponsor will publish a notice in a
daily print or online newspaper in the county where the applicable Tax-Free NY Area is located
for no less than five consecutive days in order to identify businesses that identify themselves as
competitors in the community (“public posting”). The posting should include:
A detailed description of the business applicant’s proposed products or services
6-Digit NAICS code and proposed full business mailing address (for tax-free status)
Full contact information for the campus contact
The Sponsor is not obligated to identify the business applicant in the public posting. However,
the Sponsor should be mindful that this process is designed to provide the public with an
opportunity to identify themselves as a potential competitor and that information provided in
the public posting should be presented with this goal in mind. ESD reserves the right to review
the public posting to determine that this public notice was not sufficient and require the
Sponsor to republish a more detailed notice.
b. Identification of Competitors
If no existing companies contact the Sponsor to identify themselves as competitors in the
community, the Sponsor shall attest that no competitors were identified through this process.
The attestation should be included as part of the business’ application.
In the case that potential competitors are identified through the posting process, the Sponsor
will email ESD the identity and contact information for every company that identified itself as a
potential competitor, and will email that information to ESD ([email protected]).
Procedure for Review:
a. Initiation
In the event that any of these efforts identifies potential competitors, the Sponsor must request
a letter from the Commissioner attesting that the business does not compete with other
businesses in the same community. The request should contain information about the business
applicant; the identity and contact information for every potential competitor identified; a
comparison of the products and/or services proposed to be provided by the business applicant;
information about the products and/or services provided by the potential competitor or
competitors (if known); the community at issue; a copy of the public notice; and any other
information the business applicant deems relevant to this analysis.
b. Analysis
On receipt of this request, ESD will then review all information available to ESD to support a
final determination by the Commissioner of the Department Economic Development. The
review shall include, but not be limited to, a comparison of the products and/or services
proposed to be provided by the business applicant and the products and/or services provided
by the potential competitor or competitors. The Commissioner will make the final
determination about whether the business applicant will compete with other existing
businesses in the community.
c. Notification
Upon completion of the review, the Commissioner will provide a letter for inclusion with the
business application to the business and the Sponsor of his/her determination as to whether
the business competes with other businesses in the same community.