senate Bill S5163B

Establishes a musical and theatrical production credit against business franchise and personal income taxes for certain pre-Broadway and post-Broadway productions

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Bill Status


  • Introduced
  • In Committee
  • On Floor Calendar
    • Passed Senate
    • Passed Assembly
  • Delivered to Governor
  • Signed/Vetoed by Governor
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actions

  • 13 / May / 2013
    • REFERRED TO INVESTIGATIONS AND GOVERNMENT OPERATIONS
  • 08 / Jan / 2014
    • REFERRED TO INVESTIGATIONS AND GOVERNMENT OPERATIONS
  • 24 / Jan / 2014
    • AMEND AND RECOMMIT TO INVESTIGATIONS AND GOVERNMENT OPERATIONS
  • 24 / Jan / 2014
    • PRINT NUMBER 5163A
  • 13 / Mar / 2014
    • AMEND AND RECOMMIT TO INVESTIGATIONS AND GOVERNMENT OPERATIONS
  • 13 / Mar / 2014
    • PRINT NUMBER 5163B

Summary

Establishes a musical and theatrical production credit against business franchise and personal income taxes for certain pre-Broadway and post-Broadway productions.

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Bill Details

See Assembly Version of this Bill:
A8730A
Versions:
S5163
S5163A
S5163B
Legislative Cycle:
2013-2014
Current Committee:
Senate Investigations And Government Operations
Law Section:
Tax Law
Laws Affected:
Add §24-a, amd §§210 & 606, Tax L

Sponsor Memo

BILL NUMBER:S5163B

TITLE OF BILL: An act to amend the tax law, in relation to
establishing business franchise and personal income tax credits for
certain musical and theatrical production expenses

PURPOSE: Establishes a musical and theatrical production credit
against business franchise and personal income taxes for certain
pre-Broadway and post-Broadway productions.

SUMMARY OF PROVISIONS:

Section 1 amends the tax law by adding a new section 24-a to provide
for a musical and theatrical production credit. The amount of the
credit is twenty-five percent of qualified production costs incurred
in New York State. For credits that are at least one million dollars
but less than five million dollars the credit will be claimed over a
two year period beginning in the first taxable year in which the
credit may be claimed and in the next succeeding taxable year with
one-half of the amount of the credit allowed being claimed in each
year. If the amount of the credit is at least five million dollars,
the credit shall be claimed over a three year period beginning in the
first taxable year in which the credit may be claimed and in the next
two seceding taxable years, with one-third of the amount of the credit
allowed being claimed each year.

An accredited theater production is defined as a for-profit live stage
presentation in a qualified production facility and certified by the
governor's office of motion picture and television development that is
either a pre-Broadway production or is a post-Broadway production.
The bill defines a qualified production facility as a facility located
in the state in which live theatrical productions are, or are intended
to be, exclusively presented that contains at least one stage, a
seating capacity of one thousand five hundred or more seats, and
dressing rooms, storage areas, and other ancillary amenities necessary
for the accredited theater productions.

Section 2 amends section 210 of the tax law to state that the credit
allowed under this subdivision for any taxable year shall not reduce
the tax due for each year to less than the amount prescribed in
paragraph (d) of subdivision one of this section Provided, however,
that if the amount of the credit allowable under this subdivision for
any taxable year reduces the tax to such amount, the excess shall be
treated as an overpayment of the tax to be credited or refunded.

Section 3 (B) of paragraph 1 of subsection (i) of section 606 of the
tax law is amended by adding a new clause (xxxvii) to include the
musical and theatrical production credit.

Section 4 amends section 606 of the tax law by adding a new subsection
(u) to included the musical and theatrical production tax credit.

Section 5 contains the effective date.

EXISTING LAW: Under current law, New York State provides for a
production tax credit for film and television.


JUSTIFICATION: Modeled after the successful Rhode Island musical and
theatrical production tax credit for pre and post- Broadway
productions, this bill aims to encourage investment in live events and
further spur investment and tourism in both the Mid and Upstate
regions of the State. Further, New York will also be able to compete
with a growing number of other states that offer similar incentives
for investors in live theater, such as Louisiana, Illinois and Rhode
Island.

Across this state, from Buffalo to the capital region and from
Poughkeepsie to Binghamton to Elmira; upstate cities can boast
incredible economic activity due to the drive of New York's famous
Broadway at theaters like Shea's, Proctors, the Clemens Center and the
newly opened Landmark in Syracuse.

This tax credit will boost investment in these Upstate New York Cities
increasing production and ultimately jobs and the economy.

LEGISLATIVE HISTORY: 2013: S.5163 Referred to Investigation and
Government Operations

FISCAL IMPLICATIONS: To be determined

EFFECTIVE DATE: This act shall take effect January 1, 2015

view bill text
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                 5163--B

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                              May 13, 2013
                               ___________

Introduced  by  Sens.  LITTLE, LIBOUS -- read twice and ordered printed,
  and when printed to be committed to the  Committee  on  Investigations
  and  Government Operations -- recommitted to the Committee on Investi-
  gations and Government Operations in accordance with  Senate  Rule  6,
  sec.  8  --  committee  discharged, bill amended, ordered reprinted as
  amended and recommitted to said  committee  --  committee  discharged,
  bill  amended,  ordered  reprinted  as amended and recommitted to said
  committee

AN ACT to amend the tax law, in relation to establishing business  fran-
  chise and personal income tax credits for certain musical and theatri-
  cal production expenses

  THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1. The tax law is amended by adding a new section 24-a to read
as follows:
  S 24-A. MUSICAL AND THEATRICAL PRODUCTION CREDIT. (A) (1) ALLOWANCE OF
CREDIT. A TAXPAYER WHICH IS A QUALIFIED THEATER PRODUCTION  COMPANY,  OR
WHICH  IS  A  SOLE PROPRIETOR OF OR A MEMBER OF A PARTNERSHIP WHICH IS A
QUALIFIED THEATER PRODUCTION COMPANY, AND WHICH  SUBJECT  TO  TAX  UNDER
ARTICLE  NINE-A OR TWENTY-TWO OF THIS CHAPTER, SHALL BE ALLOWED A CREDIT
AGAINST SUCH TAX, PURSUANT TO THE PROVISIONS REFERRED TO IN  SUBDIVISION
(C) OF THIS SECTION, AND TO BE COMPUTED AS PROVIDED IN THIS SECTION.
  (2)  THE  AMOUNT OF THE CREDIT SHALL BE THE PRODUCT (OR PRO RATA SHARE
OF THE PRODUCT, IN THE CASE OF A MEMBER OF A PARTNERSHIP) OF TWENTY-FIVE
PERCENT AND THE SUM OF THE PRODUCTION AND PERFORMANCE  EXPENDITURES  AND
THE TRANSPORTATION EXPENDITURES. IF THE AMOUNT OF THE CREDIT IS AT LEAST
ONE MILLION DOLLARS BUT LESS THAN FIVE MILLION DOLLARS, THE CREDIT SHALL
BE CLAIMED OVER A TWO YEAR PERIOD BEGINNING IN THE FIRST TAXABLE YEAR IN
WHICH THE CREDIT MAY BE CLAIMED AND IN THE NEXT SUCCEEDING TAXABLE YEAR,
WITH  ONE-HALF  OF  THE  AMOUNT  OF CREDIT ALLOWED BEING CLAIMED IN EACH
YEAR. IF THE AMOUNT OF THE CREDIT IS AT LEAST FIVE MILLION DOLLARS,  THE

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD09449-05-4

S. 5163--B                          2

CREDIT  SHALL BE CLAIMED OVER A THREE YEAR PERIOD BEGINNING IN THE FIRST
TAXABLE YEAR IN WHICH THE CREDIT MAY BE CLAIMED  AND  IN  THE  NEXT  TWO
SUCCEEDING  TAXABLE  YEARS,  WITH  ONE-THIRD OF THE AMOUNT OF THE CREDIT
ALLOWED BEING CLAIMED IN EACH YEAR.
  (3)  NO  PRODUCTION  AND  PERFORMANCE  EXPENDITURES  OR TRANSPORTATION
EXPENDITURES USED BY A TAXPAYER EITHER AS THE BASIS FOR THE ALLOWANCE OF
THE CREDIT PROVIDED FOR PURSUANT TO THIS SECTION OR USED IN  THE  CALCU-
LATION  OF THE CREDIT PROVIDED PURSUANT TO THIS SECTION SHALL BE USED BY
SUCH TAXPAYER TO CLAIM ANY OTHER CREDIT ALLOWED PURSUANT TO  THIS  CHAP-
TER.
  (B)  DEFINITIONS.  AS  USED IN THIS SECTION, THE FOLLOWING TERMS SHALL
HAVE THE FOLLOWING MEANINGS:
  (1) "QUALIFIED  THEATER  PRODUCTION  COMPANY"  MEANS  ANY  INDIVIDUAL,
CORPORATION, PARTNERSHIP OR LIMITED LIABILITY COMPANY ENGAGED IN PRODUC-
ING  QUALIFIED  LIVE  THEATER  PRODUCTIONS  FOR COMMERCIAL PURPOSE. SUCH
COMPANY, OR ITS DESIGNATED PARTY, SHALL BE RESPONSIBLE  FOR  THE  DIRECT
PRODUCTION AND PERFORMANCE COSTS, AND BE THE SIGNATORY TO CONTRACTS WITH
PAYROLL  SERVICES, FACILITIES AND VENDORS, UTILIZED IN THE PRODUCTION OF
QUALIFIED THEATER PRODUCTIONS.
  (2) "THEATER PRODUCTION" MEANS A FOR-PROFIT LIVE STAGE PRESENTATION IN
A QUALIFIED PRODUCTION FACILITY AND CERTIFIED BY THE  GOVERNOR'S  OFFICE
OF  MOTION PICTURE AND TELEVISION DEVELOPMENT THAT IS EITHER: (I) A PRE-
BROADWAY PRODUCTION, OR (II) A POST-BROADWAY PRODUCTION.
  (3)  "ADVERTISING  AND  PUBLIC  RELATIONS  EXPENDITURE"  MEANS   COSTS
INCURRED  WITHIN  THE  STATE  BY  THE ACCREDITED THEATER PRODUCTIONS FOR
GOODS OR SERVICES RELATED TO THE NATIONAL MARKETING,  PUBLIC  RELATIONS,
CREATION  AND PLACEMENT OF PRINT, ELECTRONIC, TELEVISION, BILLBOARDS AND
OTHER FORMS OF ADVERTISING TO PROMOTE THE ACCREDITED THEATER PRODUCTION.
  (4) "PAYROLL" MEANS ALL SALARIES, WAGES, FEES, AND OTHER  COMPENSATION
INCLUDING  RELATED  BENEFITS  FOR  SERVICES PERFORMED AND COSTS INCURRED
WITHIN THE STATE.
  (5) "PRE-BROADWAY PRODUCTION" MEANS A LIVE STAGE PRODUCTION  THAT,  IN
ITS ORIGINAL OR ADAPTIVE VERSION, IS PERFORMED IN A QUALIFIED PRODUCTION
FACILITY HAVING A PRESENTATION SCHEDULED FOR BROADWAY'S THEATER DISTRICT
IN  THE  CITY  OF  NEW  YORK WITHIN TWELVE MONTHS AFTER ITS PRESENTATION
OUTSIDE OF THE CITY OF NEW YORK.
  (6) "POST-BROADWAY PRODUCTION" MEANS A LIVE STAGE PRODUCTION THAT,  IN
ITS ORIGINAL OR ADAPTIVE VERSION, IS PERFORMED IN A QUALIFIED PRODUCTION
FACILITY  AND  OPENS ITS NATIONAL TOUR IN THIS STATE, BUT OUTSIDE OF THE
CITY OF NEW YORK, AFTER A PRESENTATION SCHEDULED FOR BROADWAY'S  THEATER
DISTRICT IN THE CITY OF NEW YORK.
  (7)  "PRODUCTION AND PERFORMANCE EXPENDITURES" MEANS A CONTEMPORANEOUS
EXCHANGE OF CASH OR CASH EQUIVALENT FOR GOODS  OR  SERVICES  RELATED  TO
DEVELOPMENT,  PRODUCTION, PERFORMANCE OR OPERATING EXPENDITURES INCURRED
IN THIS STATE FOR A QUALIFIED  THEATER  PRODUCTION  INCLUDING,  BUT  NOT
LIMITED TO, EXPENDITURES FOR DESIGN, CONSTRUCTION AND OPERATION, INCLUD-
ING  SETS,  SPECIAL  AND  VISUAL  EFFECTS, COSTUMES, WARDROBES, MAKE-UP,
ACCESSORIES, COSTS ASSOCIATED WITH SOUND,  LIGHTING,  STAGING,  PAYROLL,
TRANSPORTATION  EXPENDITURES,  ADVERTISING AND PUBLIC RELATIONS EXPENDI-
TURES, FACILITY EXPENSES, RENTALS, PER DIEMS, ACCOMMODATIONS  AND  OTHER
RELATED COSTS.
  (8)  "QUALIFIED  PRODUCTION  FACILITY" MEANS A FACILITY LOCATED IN THE
STATE IN WHICH LIVE THEATRICAL PRODUCTIONS ARE, OR ARE INTENDED  TO  BE,
EXCLUSIVELY PRESENTED THAT CONTAINS AT LEAST ONE STAGE, A SEATING CAPAC-
ITY  OF  ONE  THOUSAND  FIVE  HUNDRED OR MORE SEATS, AND DRESSING ROOMS,

S. 5163--B                          3

STORAGE AREAS, AND OTHER ANCILLARY AMENITIES NECESSARY FOR  THE  ACCRED-
ITED THEATER PRODUCTION.
  (9) (I) "TRANSPORTATION EXPENDITURES" MEANS EXPENDITURES FOR THE PACK-
AGING, CRATING, AND TRANSPORTATION BOTH TO THE STATE FOR USE IN A QUALI-
FIED  THEATER  PRODUCTION  OF SETS, COSTUMES, OR OTHER TANGIBLE PROPERTY
CONSTRUCTED OR MANUFACTURED OUT OF STATE, AND/OR FROM  THE  STATE  AFTER
USE IN A QUALIFIED THEATER PRODUCTION OF SETS, COSTUMES, OR OTHER TANGI-
BLE PROPERTY CONSTRUCTED OR MANUFACTURED IN THIS STATE AND THE TRANSPOR-
TATION  OF  THE  CAST  AND  CREW  TO AND FROM THE STATE. SUCH TERM SHALL
INCLUDE THE PACKAGING, CRATING, AND TRANSPORTING OF PROPERTY AND  EQUIP-
MENT  USED FOR SPECIAL AND VISUAL EFFECTS, SOUND, LIGHTING, AND STAGING,
COSTUMES, WARDROBES, MAKE-UP AND RELATED ACCESSORIES AND  MATERIALS,  AS
WELL  AS ANY OTHER PERFORMANCE OR PRODUCTION-RELATED PROPERTY AND EQUIP-
MENT.
  (II) TRANSPORTATION EXPENDITURES SHALL NOT INCLUDE ANY COSTS TO TRANS-
PORT PROPERTY AND EQUIPMENT TO BE USED ONLY FOR FILMING  AND  NOT  IN  A
QUALIFIED  THEATER PRODUCTION, ANY INDIRECT COSTS, AND EXPENDITURES THAT
ARE LATER REIMBURSED BY A THIRD PARTY, OR ANY AMOUNTS THAT ARE  PAID  TO
PERSONS  OR  ENTITIES AS A RESULT OF THEIR PARTICIPATION IN PROFITS FROM
THE EXPLOITATION OF THE PRODUCTION.
  (C) CROSS-REFERENCES. FOR APPLICATION OF THE CREDIT  PROVIDED  FOR  IN
THIS SECTION, SEE THE FOLLOWING PROVISIONS OF THIS CHAPTER:
  (1) ARTICLE 9-A: SECTION 210: SUBDIVISION 36-A.
  (2) ARTICLE 22: SECTION 606: SUBSECTION (U).
  (D) NOTWITHSTANDING ANY PROVISION OF THIS CHAPTER, EMPLOYEES AND OFFI-
CERS  OF THE GOVERNOR'S OFFICE OF MOTION PICTURE AND TELEVISION DEVELOP-
MENT AND THE DEPARTMENT SHALL BE ALLOWED AND ARE DIRECTED TO  SHARE  AND
EXCHANGE  INFORMATION  REGARDING  THE  CREDITS  APPLIED FOR, ALLOWED, OR
CLAIMED PURSUANT TO THIS SECTION AND  TAXPAYERS  WHO  ARE  APPLYING  FOR
CREDITS  OR WHO ARE CLAIMING CREDITS, INCLUDING INFORMATION CONTAINED IN
OR DERIVED FROM CREDIT CLAIM  FORMS  SUBMITTED  TO  THE  DEPARTMENT  AND
APPLICATIONS  FOR  CERTIFICATION  SUBMITTED  TO THE GOVERNOR'S OFFICE OF
MOTION PICTURE AND TELEVISION DEVELOPMENT.
  S 2. Section 210 of the tax law is amended by adding a new subdivision
36-a to read as follows:
  36-A. MUSICAL AND THEATRICAL PRODUCTION CREDIT. (A) ALLOWANCE OF CRED-
IT.  A TAXPAYER WHO IS ELIGIBLE PURSUANT  TO  SECTION  TWENTY-FOUR-A  OF
THIS  CHAPTER  SHALL  BE  ALLOWED A CREDIT TO BE COMPUTED AS PROVIDED IN
SUCH SECTION AGAINST THE TAX IMPOSED BY THIS ARTICLE.
  (B) THE CREDIT ALLOWED UNDER THIS SUBDIVISION  FOR  ANY  TAXABLE  YEAR
SHALL  NOT  REDUCE  THE  TAX  DUE  FOR SUCH YEAR TO LESS THAN THE AMOUNT
PRESCRIBED  IN  PARAGRAPH  (D)  OF  SUBDIVISION  ONE  OF  THIS  SECTION.
PROVIDED, HOWEVER, THAT IF THE AMOUNT OF THE CREDIT ALLOWABLE UNDER THIS
SUBDIVISION  FOR  ANY  TAXABLE  YEAR REDUCES THE TAX TO SUCH AMOUNT, THE
EXCESS SHALL BE TREATED AS AN OVERPAYMENT  OF  TAX  TO  BE  CREDITED  OR
REFUNDED  IN  ACCORDANCE  WITH  THE  PROVISIONS  OF SECTION ONE THOUSAND
EIGHTY-SIX  OF  THIS  CHAPTER.  PROVIDED,  FURTHER,  THE  PROVISIONS  OF
SUBSECTION  (C)  OF  SECTION  ONE  THOUSAND EIGHTY-EIGHT OF THIS CHAPTER
NOTWITHSTANDING, NO INTEREST SHALL BE PAID THEREON.
  S 3. Subparagraph (B) of paragraph 1 of subsection (i) of section  606
of  the  tax  law  is amended by adding a new clause (xxxvii) to read as
follows:
(XXXVII) MUSICAL AND THEATRICAL      AMOUNT OF CREDIT FOR
PRODUCTION CREDIT UNDER              THE SUM OF THE PRODUCTION AND
SUBSECTION (U)                       PERFORMANCE EXPENDITURES AND
                                     THE TRANSPORTATION EXPENDITURES

S. 5163--B                          4

                                     IN AN ACCREDITED THEATRE
                                     PRODUCTION UNDER SUBDIVISION
                                     THIRTY-SIX-A OF SECTION TWO
                                     HUNDRED TEN
  S  4. Section 606 of the tax law is amended by adding a new subsection
(u) to read as follows:
  (U) MUSICAL AND THEATRICAL PRODUCTION CREDIT. (1) ALLOWANCE OF CREDIT.
A TAXPAYER WHO IS ELIGIBLE PURSUANT TO  SECTION  TWENTY-FOUR-A  OF  THIS
CHAPTER  SHALL  BE  ALLOWED  A CREDIT TO BE COMPUTED AS PROVIDED IN SUCH
SECTION AGAINST THE TAX IMPOSED BY THIS ARTICLE.
  (2) APPLICATION OF CREDIT. IF THE AMOUNT OF THE CREDIT ALLOWABLE UNDER
THIS SUBSECTION FOR ANY TAXABLE YEAR EXCEEDS THE TAXPAYER'S TAX FOR SUCH
YEAR, THE EXCESS SHALL BE TREATED AS AN OVERPAYMENT OF TAX TO BE CREDIT-
ED OR REFUNDED AS PROVIDED IN SECTION SIX  HUNDRED  EIGHTY-SIX  OF  THIS
ARTICLE, PROVIDED, HOWEVER, THAT NO INTEREST SHALL BE PAID THEREON.
  S 5. This act shall take effect January 1, 2015.

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