Relates to enacting the New York state digital game development and incentive act to enhance opportunities in the gaming industry.
TITLE OF BILL: An act to amend the urban development corporation act and the state finance law, in relation to establishing the New York state digital game development and incentive act
PURPOSE: To incentivize rapid growth and job creation in the digital game development industry by providing competitions and events around the state
SUMMARY OF PROVISIONS:
Section 1 New 16-w in the urban development corporation act, the NYS digital game development and incentive act. Key provisions:
Raise NYS profile
* NYS digital game summit, regional events, & representation at national events. The summit will be a celebration of New York's industry sponsored by one or more private groups, and regional support is to include support of regional and local events. The purpose is to create an ecosystem of related gatherings, meetings, and competitions. Representation at events will entail ESDC organizing and/or participating in representation of New York digital game companies, entrepreneurs, academics, and others at major game events and venues.
* NYS digital game development competition, a three stage judged competition for prizes over a 24-month period. Judges are from industry, academia, and economic development. Competitors must be residents of the state, new and emerging talent, and early seed stage startup entrepreneurs. The competition is as follows:
- First competition - 10 winners from each NYS 10 economic development regions. Prize is $10,000 Requires conceptualization, design document, and at least a digital prototype. Winners use the prizes to link with incubators and to develop business attributes and product completion necessary for the next phase of the competition.
- Second competition - 10 winners from the winners of the first competition, scheduled at different venues around the state. Prize is matching funds of up to $100,000. Entrants should be in pre-production, with a vertical slice, and have raised funds for match. Prizes will include access to incubator space and mentoring.
- Final competition - two winners from the ten, selected at the NYS digital game summit. Prize is $500,000. Entrants must have a completed game, and update the information required in the second competition.
- Competition 2 and 3 winners must agree to remain resident in the state for game development purposes for three years, and to return the award to the state should they leave or sell the game or the game company prior to that. Winners must also agree to contribute one percent of
profits of the game to the New York state digital game development fund for three years after publication of the game, or until the amount contributed matches the amount of the award received, whichever time period is less.
* NYS digital game development fund, To receive funds from revenues contributed by winners of the competitions.
EXISTING LAW: New bill.
JUSTIFICATION: The digital game industry is $21 billion domestically (2012), greater than the music industry ($16.5 billion), the movie industry ($10.44 billion) and the DVD industry ($18 billion), growing at 10% per year, with an average salary for direct employees of $90,000.
New York ranks 4th among the top states, with 71 developers and publishers and 5,474 direct and indirect jobs. Average compensation is $96,602. Top states are California, Washington, Texas, with Massachusetts coming up behind.
The changes in this legislation will dramatically increase New York's share of the industry they are based on recommendations and discussions conducted with the industry in all-day roundtables and other discussions.
FISCAL IMPLICATIONS: To be determined, but minimal in the current fiscal year, and then limited thereafter to appropriations and tax credit caps.
On the ninetieth day after it shall have become law.
STATE OF NEW YORK ________________________________________________________________________ 6793 IN SENATE March 11, 2014 ___________Introduced by Sens. GOLDEN, GALLIVAN, BALL, GRIFFO, ROBACH, VALESKY -- read twice and ordered printed, and when printed to be committed to the Committee on Corporations, Authorities and Commissions AN ACT to amend the urban development corporation act and the state finance law, in relation to establishing the New York state digital game development and incentive act THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Section 1 of chapter 174 of the laws of 1968, constituting the New York state urban development corporation act, is amended by adding a new section 16-w to read as follows: S 16-W. THE NEW YORK STATE DIGITAL GAME DEVELOPMENT AND INCENTIVE ACT. 1. AS USED IN THIS SECTION: A. "DIGITAL GAME DEVELOPMENT" OR "DIGITAL GAME SOFTWARE" COMPANIES (COLLECTIVELY, "DIGITAL GAME COMPANIES") AND PUBLISHERS ARE COMPANIES ENGAGED IN DEVELOPING, PRODUCING, OR PUBLISHING ENTERTAINMENT SOFTWARE FOR ONE OR MULTIPLE PLATFORMS OR PLAYING DEVICES THAT MAY OR MAY NOT BE DOWNLOADED ELECTRONICALLY, INCLUDING COMPANIES THAT ARE OR WOULD BE CLASSIFIED UNDER NAIC CODE 511210 OR ANY SUCCESSOR THERETO; B. "NEW YORK STATE INCUBATOR" OR "NEW YORK STATE INNOVATION HOT SPOT" HAVE THE SAME MEANINGS AS "NEW YORK STATE INCUBATORS" AND "NEW YORK STATE INNOVATION HOT SPOTS" AS USED IN SECTION SIXTEEN-V OF THIS ACT; C. "ANCHOR TENANT" MEANS ENTITIES OR PERSONS SO DESIGNATED BY THE COMMISSIONER OF ECONOMIC DEVELOPMENT THAT ARE DIGITAL GAME COMPANIES, OR ARE SUBSIDIARIES OF OR NEW VENTURES OWNED WHOLLY OR IN PART BY DIGITAL GAME COMPANIES. AN ENTITY OR PERSON CANNOT BE AN ANCHOR TENANT UNLESS IT IS RESIDENT IN NEW YORK STATE AND ESTABLISHES OPERATIONS PURSUANT TO THE START-UP NY PROGRAM AUTHORIZED UNDER ARTICLE 21 OF THE ECONOMIC DEVELOP- MENT LAW IN AN INDUSTRY CLUSTER OF DIGITAL GAME COMPANIES. 2. THE CORPORATION IS AUTHORIZED AND DIRECTED, WITHIN AMOUNTS MADE AVAILABLE TO IT BY APPROPRIATION THEREFOR AND SUCH OTHER PUBLIC AND PRIVATE FUNDS AS SHALL ADDITIONALLY BE MADE AVAILABLE, TO PROVIDE LOANS AND GRANTS FOR SERVICES AND EXPENSES RELATED TO PLANNING AND IMPLEMENT- ING A NEW YORK STATE DIGITAL GAME SUMMIT, TO SUPPORT AND PROMOTE OTHEREXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD14395-01-4 S. 6793 2
LOCAL AND REGIONAL DIGITAL GAME EVENTS, AND TO ORGANIZE STATE REPRESEN- TATION AT NATIONAL DIGITAL GAME EVENTS DEEMED AFTER CONSULTATION WITH THE NEW YORK STATE DIGITAL GAME DEVELOPMENT ADVISORY BOARD TO BE SIGNIF- ICANT AND APPROPRIATE TO RAISING NEW YORK'S PROFILE AND STATUS IN THE GAME DEVELOPMENT INDUSTRY. PRIOR TO TAKING SUCH ACTIONS, THE CORPORATION SHALL CONSULT WITH AND DEVELOP A PLAN TO MAXIMIZE THE EFFECT OF SUCH ACTIVITIES WITH THE NEW YORK DIGITAL GAME DEVELOPMENT ADVISORY BOARD. GENERAL REQUIREMENTS AND PARAMETERS FOR THESE ACTIVITIES SHALL BE AS FOLLOWS: A. NEW YORK STATE GAME SUMMIT SHALL BE A MULTI-DAY CONVENTION AND CELEBRATION OF NEW YORK'S DIGITAL GAME INDUSTRY, INCLUDING ENTREPRE- NEURS, STUDENTS, ACADEMIC INSTITUTIONS, AND COMPANIES, TO BE HELD IN NEW YORK CITY AT A TIME WHEN THERE IS THE LEAST AMOUNT OF COMPETITION FROM OTHER NATIONAL AND IN-STATE EVENTS, AT A VENUE WITH A HISTORY AND INTER- EST IN DIGITAL GAMING OR IN CONVENTIONS WHICH ARE ABLE TO HOUSE THE LAUNCH OF A GROWING EVENT. THE GAME SUMMIT WILL ALSO INCLUDE THE FINALS OF THE NEW YORK DIGITAL GAME DEVELOPMENT COMPETITION, CREATED AND AUTHORIZED BY THIS SECTION, AND SHALL INCLUDE DEMONSTRATIONS AND DISCUSSIONS OF GAMES, EDUCATIONAL FORUMS IN WHICH EDUCATORS CAN LEARN ABOUT USING GAMES IN THE CLASSROOM, AND OTHER ACTIVITIES DEEMED APPRO- PRIATE BY THE CORPORATION TO SUCH AN EVENT. THE CORPORATION SHALL PART- NER WITH AND SUPPORT ONE OR MORE PRIVATE ENTITIES AND TRADE ASSOCIATIONS THAT CREATE AND IMPLEMENT THE SUMMIT. B. REGIONAL SUPPORT SHALL INCLUDE SUPPORT OF AND COLLABORATIONS WITH REGIONAL AND LOCAL DIGITAL GAME PUBLISHERS AND DEVELOPER EVENTS, FOR THE PURPOSE OF CREATING AN ECOSYSTEM OF RELATED GATHERINGS, MEETINGS, AND COMPETITIONS IN THIS STATE. C. REPRESENTATION AT EVENTS WILL ENTAIL THE CORPORATION ORGANIZING AND/OR PARTICIPATING IN REPRESENTATION OF NEW YORK DIGITAL GAME COMPA- NIES, ENTREPRENEURS, ACADEMICS, AND OTHERS AT MAJOR GAME EVENTS AND VENUES. 3. THE CORPORATION IS AUTHORIZED, WITHIN AMOUNTS MADE AVAILABLE TO IT BY APPROPRIATION THEREFOR AND WITH SUCH OTHER PUBLIC AND PRIVATE FUNDS AS SHALL ADDITIONALLY BE MADE AVAILABLE, TO PLAN AND IMPLEMENT THE NEW YORK STATE DIGITAL GAME DEVELOPMENT COMPETITION, THE PURPOSE OF WHICH SHALL BE TO ANNUALLY RECOGNIZE AND ENCOURAGE EMERGING TALENT IN GAME DEVELOPMENT IN THIS STATE THROUGH A THREE STAGE JUDGED COMPETITION FOR PRIZES OVER A PERIOD NOT LONGER THAN TWENTY-FOUR MONTHS. THE CORPORATION SHALL CONSULT WITH AND DEVELOP A PLAN FOR THE GAME DEVELOPMENT COMPETI- TION WITH THE NEW YORK DIGITAL GAME DEVELOPMENT ADVISORY BOARD. GENERAL REQUIREMENTS AND PARAMETERS FOR THESE ACTIVITIES ARE AS FOLLOWS: A. THE FIRST COMPETITION SHALL TAKE PLACE WITHIN EACH ECONOMIC DEVEL- OPMENT REGION IN THE STATE, AND SHALL RESULT IN TEN WINNERS PER REGION. NOTHING CONTAINED HEREIN SHALL PREVENT TWO OR MORE REGIONS FROM COLLAB- ORATING IN THIS STAGE OF THE COMPETITION, AND THE CORPORATION SHALL ESTABLISH RULES OR GUIDELINES TO GOVERN SUCH COLLABORATIONS. THE SECOND COMPETITION SHALL TAKE PLACE AMONG THE WINNERS OF THE FIRST COMPETITION, AND SHALL RESULT IN TEN WINNERS. THIS COMPETITION SHALL BE SCHEDULED AT DIFFERENT VENUES WITHIN THE STATE EACH YEAR TO ASSURE GEOGRAPHICAL BALANCE. THE FINAL COMPETITION SHALL RESULT IN TWO WINNERS AND SHALL BE CONDUCTED AS PART OF THE NEW YORK STATE DIGITAL GAME SUMMIT. WINNERS OF THE FIRST COMPETITION SHALL RECEIVE PRIZES OF TEN THOUSAND DOLLARS EACH. WINNERS OF THE SECOND COMPETITION SHALL RECEIVE MATCHING FUND PRIZES OF UP TO ONE HUNDRED THOUSAND DOLLARS EACH. WINNERS OF THE THIRD COMPETI- TION SHALL RECEIVE PRIZES OF FIVE HUNDRED THOUSAND DOLLARS EACH.S. 6793 3
B. EACH COMPETITION SHALL BE JUDGED BY A SEVEN-MEMBER PANEL OF INDUS- TRY OFFICIALS, ENTREPRENEURS, ACADEMICS, AND ECONOMIC DEVELOPMENT OFFI- CIALS IN THE REGION OR IN THE STATE AS APPROPRIATE TO THE LEVEL OF THE COMPETITION, SELECTED BY THE CORPORATION BASED ON RECOMMENDATIONS FROM THE COMMUNITY, THE GAMING INDUSTRY, AND GOVERNMENT AND OTHER OFFICIALS IN THE REGION. THE PANELS SHOULD INCLUDE A PREPONDERANCE OF JUDGES WHO ARE INDUSTRY OFFICIALS, ENTREPRENEURS, ACADEMICS, AND SUCH JUDGES SHOULD HAVE A BACKGROUND IN OR KNOWLEDGE OF DIGITAL GAMES, GAME PUBLISHING, AND GAME DEVELOPMENT AND AN UNDERSTANDING OF COMMERCIAL APPEAL AND MARKETA- BILITY OF GAMES. C. THE CORPORATION SHALL ESTABLISH CRITERIA FOR ELIGIBILITY OF COMPE- TITION ENTRANTS THAT REQUIRE RESIDENCY IN THIS STATE AND THAT LIMIT ENTRANTS TO NEW AND EMERGING TALENT AND EARLY SEED STAGE STARTUP ENTRE- PRENEURS AS EVIDENCED BY FACTORS SUCH AS THAT THE ENTRANT HAS NOT PUBLISHED A GAME PREVIOUSLY OR, IF SUCH ENTRANT HAS PUBLISHED A GAME IT HAS EARNED A SMALL AMOUNT AS DETERMINED BY THE CORPORATION, OR THAT SUCH ENTRANT IS CURRENTLY A CLIENT OF A NEW YORK STATE INCUBATOR OR NEW YORK STATE INNOVATION HOT SPOT, AND THE COMPANY HAS BEEN IN EXISTENCE FOR LESS THAN THREE YEARS, AND OTHER SIMILAR FACTORS. D. FACTORS TO BE INCLUDED IN JUDGING EACH PHASE OF THE COMPETITION ARE AS FOLLOWS: (I) FOR THE FIRST PHASE ENTRANTS SHOULD SHOW CONCEPTUALIZATION, A DESIGN DOCUMENT, AND PRE-PRODUCTION WITH CODING COMPLETED TO AT LEAST A DIGITAL PROTOTYPE THAT SHOWS HOW THE GAME WOULD WORK. ADDITIONALLY, THE JUDGES SHALL CONSIDER THE QUALITY OF THE GAME CONCEPT, THE PITCH OF THE INDIVIDUAL TEAMS, THE TEAM DYNAMIC, AND THE LEVEL OF REAL, SUBSTANTIAL, AND CONTINUING CONTROL OF THE I.P. WINNERS SHALL USE THE FUNDS TO LINK WITH NEW YORK STATE INCUBATORS FOR COUNSELING AND MENTORING AND TO DEVELOP THE NECESSARY BUSINESS ATTRIBUTES AS WELL AS ADDITIONAL PRODUCT COMPLETION NECESSARY FOR THE NEXT PHASE OF THE COMPETITION; (II) FOR THE SECOND PHASE COMPETITION AMONG THE WINNERS OF THE FIRST PHASE, ENTRANTS SHOULD BE IN PRE-PRODUCTION, AND SHOULD HAVE RAISED FUNDS FROM INVESTORS OR FUNDING SITES OR OTHER SOURCES. PRIZES WILL BE A MATCH TO SUCH FUNDS, UP TO ONE HUNDRED THOUSAND DOLLARS, PLUS ACCESS TO INCUBATOR SPACE AND MENTORING, SKILL BUILDING, AND OTHER SERVICES AVAIL- ABLE TO BEING AN INCUBATOR CLIENT, AS NEGOTIATED AND DEVELOPED BY THE CORPORATION. JUDGES WILL LOOK AT ASPECTS OF THE PRODUCT AS WELL AS THE BUSINESS PROPOSAL. COMPETITORS SHOULD HAVE COMPLETED AND SUBMITTED EVIDENCE SATISFACTORY TO THE CORPORATION OF: (A) A BUSINESS TEAM (BAIL TEAM) AND A BUSINESS AND MARKETING PLAN; (B) A STRATEGIC MONETIZATION INVESTMENT AND FUNDING PLAN; (C) A BUSINESS (INCLUDING A DBA, OR ANY OTHER FORM OF BUSINESS ORGAN- IZATION); (D) A COMPLETED PRODUCT PLAN FOR MARKETING AND FINAL DEVELOPMENT; (E) PROOF OF CONCEPT CONSISTING AT LEAST OF A "VERTICAL SLICE" OF THE GAME, MEANING AT LEAST ONE LEVEL OF PLAY, POLISH AND FINISH, WITH THE INFRASTRUCTURE LARGELY COMPLETED; (F) PUBLIC TESTING OR ACCEPTANCE OR OTHER EVIDENCE OF MARKETING VALUE OF THE GAME; (III) FOR THE THIRD PHASE COMPETITION AMONG WINNERS OF THE SECOND PHASE, ENTRANTS MUST HAVE A COMPLETED GAME SUBMITTED FOR JUDGING, AND UPDATE THE INFORMATION REQUIRED IN PHASE TWO OF THE COMPETITION. CONTES- TANTS SHOULD ALSO REVEAL WHAT THEY INTEND TO DO WITH THE AWARD MONEY IF THEY WIN. E. AS A CONDITION OF RECEIPT OF AWARDS RECEIVED IN PHASES TWO AND THREE, CONTESTANTS SHALL AGREE TO REMAIN RESIDENT IN THE STATE FOR GAMES. 6793 4
DEVELOPMENT PURPOSES FOR A PERIOD OF FIVE YEARS, AND TO RETURN THE AWARD TO THE STATE SHOULD THEY LEAVE OR SELL THE GAME OR THE GAME COMPANY PRIOR TO THAT FIVE-YEAR PERIOD. WINNERS IN PHASES ONE AND TWO SHALL ALSO AGREE, AS A CONDITION OF RECEIPT OF THE AWARD, TO CONTRIBUTE ONE PERCENT OF PROFITS OF THE GAME TO THE NEW YORK STATE DIGITAL GAME DEVELOPMENT FUND CREATED PURSUANT TO SECTION NINETY-NINE-V OF THE STATE FINANCE LAW, FOR A PERIOD OF THREE YEARS AFTER PUBLICATION OF THE GAME, OR UNTIL THE AMOUNT CONTRIBUTED MATCHES THE AMOUNT OF THE AWARD RECEIVED, WHICHEVER TIME PERIOD IS LESS. F. THE CORPORATION SHALL TAKE SUCH STEPS AS ARE NECESSARY OR CONVEN- IENT IN ASSOCIATION WITH GAME PUBLISHERS TO PROVIDE OPPORTUNITIES FOR PHASE TWO AWARD RECIPIENTS TO OBTAIN CONSIDERATION OF PUBLICATION OF THEIR GAMES. S 2. The state finance law is amended by adding a new section 99-v to read as follows: S 99-V. NEW YORK STATE DIGITAL GAME DEVELOPMENT FUND. 1. THERE IS HEREBY ESTABLISHED IN THE JOINT CUSTODY OF THE COMPTROLLER AND THE COMMISSIONER OF ECONOMIC DEVELOPMENT AN ACCOUNT IN THE MISCELLANEOUS SPECIAL REVENUE FUND TO BE KNOWN AS THE "NEW YORK STATE DIGITAL GAME DEVELOPMENT FUND". 2. SUCH ACCOUNT SHALL CONSIST OF MONIES DEPOSITED INTO IT FROM THE REQUIREMENTS ESTABLISHED PURSUANT TO PARAGRAPH E OF SUBDIVISION THREE OF SECTION SIXTEEN-W OF THE URBAN DEVELOPMENT CORPORATION ACT. 3. ALL MONIES IN THE ACCOUNT SHALL BE AVAILABLE, SUBJECT TO APPROPRI- ATION, FOR THE PAYMENT OF EXPENSES AND PRIZES OF THE NEW YORK DIGITAL GAME DEVELOPMENT COMPETITION. S 3. This act shall take effect on the ninetieth day after it shall have become a law.