S T A T E   O F   N E W   Y O R K
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                                 2551--A

                       2015-2016 Regular Sessions

                          I N  A S S E M B L Y

                            January 16, 2015
                               ___________

Introduced  by  M.  of  A.  CUSICK,  CRESPO, SIMANOWITZ, THIELE, MARKEY,
  MALLIOTAKIS, GOLDFEDER,  BENEDETTO,  KEARNS,  HEVESI,  PERRY,  CURRAN,
  WEPRIN,  ROZIC, RODRIGUEZ, DenDEKKER, GJONAJ, MILLER, SKARTADOS, SALA-
  DINO, FITZPATRICK, ARROYO, TITONE, HIKIND, McDONALD, BRABENEC, GIGLIO,
  OTIS, FINCH, WOZNIAK, GANTT, LAWRENCE, MOYA -- Multi-Sponsored  by  --
  M.  of A.   BLANKENBUSH, BRAUNSTEIN, COLTON, COOK, CORWIN, CYMBROWITZ,
  DAVILA, GARBARINO, GOODELL, GRAF, HAWLEY, KATZ, KOLB,  LALOR,  LENTOL,
  LOPEZ,  McLAUGHLIN, MONTESANO, NOJAY, OAKS, ORTIZ, PALMESANO, PALUMBO,
  PEOPLES-STOKES, PICHARDO, PRETLOW, RA, SCHIMMINGER, SIMOTAS,  SOLAGES,
  STEC,  TENNEY,  TITUS,  WEINSTEIN  --  read  once  and referred to the
  Committee on Ways and Means -- recommitted to the  Committee  on  Ways
  and  Means  in  accordance  with  Assembly Rule 3, sec. 2 -- committee
  discharged, bill amended, ordered reprinted as amended and recommitted
  to said committee

AN ACT to amend the tax law and the education law, in relation to enact-
  ing the "education investment incentives act"

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

  Section  1.  Short  title. This act shall be known and may be cited as
the "education investment incentives act".
  S 2. Legislative findings and intent. The legislature hereby finds and
declares that:
  a. The education of the children of this state is one of  the  founda-
tions  of  a  strong  society  that  requires an academically robust and
financially sound school system, both public and non-public;
  b. At a time when the state is considering ways of  reducing  the  tax
burden  for New York state residents and educators are seeking an expan-
sion of financial resources, charitable giving for educational  purposes
should be encouraged;

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD07511-02-6

A. 2551--A                          2
              

  c.  Permitting  public education entities such as school districts and
individual public schools to accept and receive voluntary cash  contrib-
utions will be beneficial to students, taxpayers and educators;
  d.  Encouraging voluntary support for education, without prejudice for
or against any state-sanctioned  educational  enterprise,  promotes  the
state's interest in providing the highest quality education to all chil-
dren in the state;
  e.  The  tax credit provided in this act is merely one of many credits
available to New York taxpayers;
  f. The intended beneficiaries of the tax credits provided in this  act
are  the  students who attend public schools, students who further their
education using tuition scholarships from educational scholarship organ-
izations, and teachers who purchase with personal funds to supply  their
students and classrooms, and who seek charitable donations for classroom
projects and initiatives;
  g.  Permitting  educators to claim a credit for the purchase of class-
room instructional materials and supplies will insure a wider availabil-
ity of such materials and supplies for all students.
  S 3.  The tax law is amended by adding a new section  42  to  read  as
follows:
  S  42.  EDUCATION  INVESTMENT  TAX  CREDIT.   (A) DEFINITIONS. FOR THE
PURPOSES OF THIS SECTION, THE FOLLOWING TERMS SHALL HAVE  THE  FOLLOWING
MEANINGS:
  1.  "AUTHORIZED  CONTRIBUTION"  MEANS  THE CONTRIBUTION AMOUNT THAT IS
LISTED ON THE  CONTRIBUTION  AUTHORIZATION  CERTIFICATE  ISSUED  TO  THE
TAXPAYER.
  2.  "CONTRIBUTION"  MEANS  A  DONATION PAID BY CASH, CHECK, ELECTRONIC
FUNDS TRANSFER, DEBIT CARD OR CREDIT CARD THAT IS MADE BY  THE  TAXPAYER
DURING THE TAXABLE YEAR.
  3.  "EDUCATIONAL PROGRAM" MEANS AN ACADEMIC PROGRAM OF A PUBLIC SCHOOL
THAT ENHANCES THE CURRICULUM OR ACADEMIC PROGRAM OF THE  PUBLIC  SCHOOL,
OR PROVIDES A PRE-KINDERGARTEN PROGRAM OR AN AFTER SCHOOL PROGRAM TO THE
PUBLIC SCHOOL. FOR PURPOSES OF THIS DEFINITION, THE INSTRUCTION, MATERI-
ALS,  PROGRAMS AND OTHER ACTIVITIES OFFERED BY OR THROUGH AN EDUCATIONAL
PROGRAM MAY INCLUDE, BUT ARE NOT LIMITED TO, THE FOLLOWING FEATURES: (I)
INSTRUCTION OR MATERIALS PROMOTING HEALTH, PHYSICAL EDUCATION, AND FAMI-
LY AND CONSUMER SCIENCES; LITERARY, PERFORMING AND  VISUAL  ARTS;  MATH-
EMATICS,  SOCIAL  STUDIES,  TECHNOLOGY  AND SCIENTIFIC ACHIEVEMENT; (II)
INSTRUCTION OR PROGRAMMING  TO  MEET  THE  EDUCATION  NEEDS  OF  AT-RISK
STUDENTS  OR  STUDENTS  WITH  DISABILITIES,  INCLUDING TUTORING OR COUN-
SELING;  OR  (III)  THE  USE  OF  SPECIALIZED  INSTRUCTIONAL  MATERIALS,
INSTRUCTORS OR INSTRUCTION NOT PROVIDED BY A PUBLIC SCHOOL.
  4.  "EDUCATIONAL SCHOLARSHIP ORGANIZATION" MEANS AN ENTITY THAT (I) IS
EXEMPT FROM TAXATION UNDER PARAGRAPH THREE OF SUBSECTION (C) OF  SECTION
FIVE  HUNDRED  ONE  OF  THE  INTERNAL REVENUE CODE, (II) COMMITS FOR THE
EXPENDITURE OF AT LEAST NINETY PERCENT OF  THE  QUALIFIED  CONTRIBUTIONS
RECEIVED DURING THE CALENDAR YEAR AND ANY INCOME DERIVED FROM SUCH QUAL-
IFIED  CONTRIBUTIONS  FOR  SCHOLARSHIPS,  (III) PROVIDES MORE THAN FIFTY
PERCENT OF ITS SCHOLARSHIPS DURING A CALENDAR YEAR  TO  ELIGIBLE  PUPILS
WHO  RESIDE  IN A HOUSEHOLD THAT HAS AN INCOME NOT TO EXCEED ONE HUNDRED
FIFTY PERCENT OF THE INCOME QUALIFICATION REQUIRED FOR THE REDUCED PRICE
SCHOOL LUNCHES UNDER THE NATIONAL SCHOOL LUNCH  ACT,  PROVIDED  HOWEVER,
FOR  THE  PURPOSES OF AN EDUCATIONAL SCHOLARSHIP ORGANIZATION FULFILLING
SUCH REQUIREMENT, AN EDUCATIONAL SCHOLARSHIP ORGANIZATION MAY ENTER INTO
AN AGREEMENT WITH ANOTHER EDUCATIONAL SCHOLARSHIP ORGANIZATION OR ORGAN-
IZATIONS TO JOINTLY REPORT THEIR SCHOLARSHIP INFORMATION  TO  MEET  SUCH

A. 2551--A                          3

REQUIREMENT,  (IV)  PROVIDES  SCHOLARSHIPS TO ELIGIBLE PUPILS FOR USE AT
NOT FEWER THAN THREE NON-PUBLIC SCHOOLS, (V) DEPOSITS AND  HOLDS  QUALI-
FIED  CONTRIBUTIONS  AND ANY INCOME DERIVED FROM QUALIFIED CONTRIBUTIONS
IN  AN  ACCOUNT  THAT  IS  SEPARATE FROM THE ORGANIZATION'S OPERATING OR
OTHER FUNDS UNTIL SUCH QUALIFIED CONTRIBUTIONS OR INCOME  ARE  WITHDRAWN
FOR  USE,  AND  (VI) IS APPROVED TO RECEIVE AUTHORIZED CONTRIBUTIONS AND
ISSUE CERTIFICATES OF RECEIPT PURSUANT TO  ARTICLE  TWENTY-FIVE  OF  THE
EDUCATION LAW.
  5.  "ELIGIBLE  PUPIL"  MEANS A CHILD WHO (I) IS A RESIDENT, (II) IS OF
SCHOOL AGE IN ACCORDANCE WITH  SUBDIVISION  ONE  OF  SECTION  THIRTY-TWO
HUNDRED  TWO  OF  THE  EDUCATION  LAW  OR WHO IS FOUR YEARS OF AGE ON OR
BEFORE DECEMBER FIRST OF THE YEAR IN WHICH SUCH CHILD IS ENROLLED  IN  A
PRE-KINDERGARTEN  PROGRAM,  (III) ATTENDS OR IS ABOUT TO ATTEND A QUALI-
FIED SCHOOL, AND (IV) RESIDES IN A HOUSEHOLD THAT HAS A FEDERAL ADJUSTED
GROSS INCOME OF TWO HUNDRED FIFTY THOUSAND  DOLLARS  OR  LESS,  PROVIDED
HOWEVER,  FOR  HOUSEHOLDS  WITH  THREE  OR MORE DEPENDENT CHILDREN, SUCH
INCOME LEVEL SHALL BE INCREASED BY TEN THOUSAND  DOLLARS  PER  DEPENDENT
CHILD  IN  EXCESS  OF TWO CHILDREN, NOT TO EXCEED THREE HUNDRED THOUSAND
DOLLARS.
  6. "LOCAL EDUCATION FUND" MEANS A NOT-FOR-PROFIT ENTITY WHICH  (I)  IS
EXEMPT  FROM TAXATION UNDER PARAGRAPH THREE OF SUBSECTION (C) OF SECTION
FIVE HUNDRED ONE OF THE INTERNAL REVENUE CODE, (II) IS  ESTABLISHED  FOR
THE  PURPOSE OF SUPPORTING AT LEAST ONE PUBLIC SCHOOL OR A PUBLIC SCHOOL
DISTRICT, (III) USES AT LEAST NINETY PERCENT OF THE  QUALIFIED  CONTRIB-
UTIONS  RECEIVED  DURING  THE  CALENDAR YEAR AND ANY INCOME DERIVED FROM
SUCH QUALIFIED CONTRIBUTIONS TO SUPPORT THE PUBLIC SCHOOL OR SCHOOLS  OR
PUBLIC  SCHOOL DISTRICT OR DISTRICTS THAT SUCH FUND HAS BEEN ESTABLISHED
TO SUPPORT, (IV) DEPOSITS AND  HOLDS  QUALIFIED  CONTRIBUTIONS  AND  ANY
INCOME  DERIVED FROM QUALIFIED CONTRIBUTIONS IN AN ACCOUNT THAT IS SEPA-
RATE FROM THE FUND'S OPERATING  OR  OTHER  FUNDS  UNTIL  SUCH  QUALIFIED
CONTRIBUTIONS  OR  INCOME  ARE WITHDRAWN FOR USE, AND (V) IS APPROVED TO
RECEIVE AUTHORIZED  CONTRIBUTIONS  AND  ISSUE  CERTIFICATES  OF  RECEIPT
PURSUANT TO ARTICLE TWENTY-FIVE OF THE EDUCATION LAW.
  7.  "NON-PUBLIC  SCHOOL"  MEANS  ANY  NOT-FOR-PROFIT  PRE-KINDERGARTEN
PROGRAM OR ELEMENTARY OR  SECONDARY  SECTARIAN  OR  NONSECTARIAN  SCHOOL
LOCATED  IN  THIS  STATE,  OTHER  THAN  A  PUBLIC  SCHOOL, THAT PROVIDES
INSTRUCTION AT ONE OR MORE LOCATIONS  TO  STUDENTS  IN  ACCORDANCE  WITH
SUBDIVISION TWO OF SECTION THIRTY-TWO HUNDRED FOUR OF THE EDUCATION LAW.
  8.  "PUBLIC EDUCATION ENTITY" MEANS A PUBLIC SCHOOL OR A PUBLIC SCHOOL
DISTRICT, PROVIDED THAT SUCH PUBLIC SCHOOL OR PUBLIC SCHOOL DISTRICT (I)
DEPOSITS AND HOLDS QUALIFIED CONTRIBUTIONS AND ANY INCOME  DERIVED  FROM
SUCH  QUALIFIED  CONTRIBUTIONS  IN  AN ACCOUNT THAT IS SEPARATE FROM THE
PUBLIC SCHOOL OR PUBLIC SCHOOL DISTRICT'S OPERATING OR OTHER FUNDS UNTIL
SUCH QUALIFIED CONTRIBUTIONS OR INCOME ARE WITHDRAWN FOR USE AND (II) IS
APPROVED  TO  ISSUE  CERTIFICATES  OF  RECEIPT   PURSUANT   TO   ARTICLE
TWENTY-FIVE OF THE EDUCATION LAW.
  9.  "PUBLIC  SCHOOL"  MEANS ANY FREE ELEMENTARY OR SECONDARY SCHOOL IN
THIS STATE PURSUANT TO ARTICLE ELEVEN OF THE CONSTITUTION, BUT SHALL NOT
INCLUDE A CHARTER SCHOOL AUTHORIZED BY ARTICLE FIFTY-SIX OF  THE  EDUCA-
TION LAW.
  10. "QUALIFIED CONTRIBUTION" MEANS THE AUTHORIZED CONTRIBUTION MADE BY
A  TAXPAYER  TO  A PUBLIC EDUCATION ENTITY, SCHOOL IMPROVEMENT ORGANIZA-
TION, LOCAL EDUCATION FUND, OR EDUCATIONAL SCHOLARSHIP ORGANIZATION  FOR
WHICH  THE CONTRIBUTION AUTHORIZATION CERTIFICATE HAS BEEN ISSUED TO THE
TAXPAYER FOR WHICH THE TAXPAYER HAS RECEIVED A  CERTIFICATE  OF  RECEIPT
FROM  SUCH ENTITY, FUND OR ORGANIZATION. A CONTRIBUTION DOES NOT QUALIFY

A. 2551--A                          4

IF THE TAXPAYER DESIGNATES THE TAXPAYER'S CONTRIBUTION TO AN  ENTITY  OR
ORGANIZATION  FOR  THE  DIRECT  BENEFIT  OF  ANY PARTICULAR OR SPECIFIED
STUDENT.
  11.  "QUALIFIED  EDUCATOR"  MEANS  AN  INDIVIDUAL  WHO IS A TEACHER OR
INSTRUCTOR IN A QUALIFIED SCHOOL FOR AT LEAST NINE HUNDRED HOURS  DURING
A SCHOOL YEAR.
  12.  "QUALIFIED  SCHOOL"  MEANS  A  PUBLIC SCHOOL OR NON-PUBLIC SCHOOL
LOCATED IN THIS STATE.
  13. "SCHOLARSHIP" MEANS AN EDUCATIONAL SCHOLARSHIP  WHICH  PROVIDES  A
TUITION  GRANT AWARDED TO AN ELIGIBLE PUPIL TO ATTEND A QUALIFIED SCHOOL
IN AN AMOUNT NOT TO EXCEED THE TUITION CHARGED  TO  ATTEND  SUCH  SCHOOL
LESS ANY OTHER EDUCATIONAL SCHOLARSHIP OR TUITION GRANT RECEIVED BY SUCH
ELIGIBLE  PUPIL  OR HIS OR HER PARENT, PARENTS, LEGAL GUARDIAN, OR LEGAL
GUARDIANS FOR SUCH ELIGIBLE PUPIL'S TUITION; PROVIDED, HOWEVER,  IN  THE
CASE  OF  AN  ELIGIBLE  PUPIL ATTENDING A PUBLIC SCHOOL IN A DISTRICT OF
WHICH SUCH PUPIL IS NOT A RESIDENT, THE AMOUNT OF THE EDUCATIONAL SCHOL-
ARSHIP AWARDED MAY NOT EXCEED THE TUITION CHARGED BY THE  PUBLIC  SCHOOL
PURSUANT  TO  PARAGRAPH  D  OF  SUBDIVISION  FOUR  OF SECTION THIRTY-TWO
HUNDRED TWO OF THE EDUCATION LAW, BUT ONLY IF  THE  SCHOOL  DISTRICT  OF
WHICH SUCH PUPIL IS A RESIDENT IS NOT REQUIRED TO PAY FOR SUCH TUITION.
  14.  "SCHOOL  IMPROVEMENT  ORGANIZATION" MEANS A NOT-FOR-PROFIT ENTITY
WHICH (I) IS EXEMPT FROM TAXATION UNDER PARAGRAPH  THREE  OF  SUBSECTION
(C)  OF SECTION FIVE HUNDRED ONE OF THE INTERNAL REVENUE CODE, (II) USES
AT LEAST NINETY PERCENT OF THE QUALIFIED CONTRIBUTIONS  RECEIVED  DURING
THE  CALENDAR  YEAR  AND ANY INCOME DERIVED FROM QUALIFIED CONTRIBUTIONS
DURING SUCH MONTHS TO ASSIST PUBLIC SCHOOLS OR PUBLIC  SCHOOL  DISTRICTS
LOCATED IN THIS STATE IN THEIR PROVISION OF EDUCATIONAL PROGRAMS, EITHER
BY  MAKING  CONTRIBUTIONS TO ONE OR MORE PUBLIC SCHOOLS OR PUBLIC SCHOOL
DISTRICTS LOCATED IN THIS STATE OR PROVIDING EDUCATIONAL PROGRAMS TO, OR
IN CONJUNCTION WITH,  ONE  OR  MORE  PUBLIC  SCHOOLS  OR  PUBLIC  SCHOOL
DISTRICTS  LOCATED  IN  THIS  STATE,  (III) DEPOSITS AND HOLDS QUALIFIED
CONTRIBUTIONS AND ANY INCOME DERIVED FROM QUALIFIED CONTRIBUTIONS IN  AN
ACCOUNT  THAT  IS  SEPARATE  FROM  THE ORGANIZATION'S OPERATING OR OTHER
FUNDS UNTIL SUCH QUALIFIED CONTRIBUTIONS OR  INCOME  ARE  WITHDRAWN  FOR
USE,  AND  (IV) IS APPROVED TO ISSUE CERTIFICATES OF RECEIPT PURSUANT TO
ARTICLE TWENTY-FIVE OF THE EDUCATION LAW. SUCH TERM INCLUDES A  PRE-KIN-
DERGARTEN  PROGRAM  OR NOT-FOR-PROFIT ENTITY THAT ALLOWS THE TAXPAYER TO
CHOOSE TO DONATE TO A PROGRAM, PROJECT OR  INITIATIVE  IDENTIFIED  BY  A
QUALIFIED EDUCATOR FOR USE IN A PUBLIC SCHOOL.
  (B)  ALLOWANCE  OF  CREDIT.  A  TAXPAYER  SUBJECT TO TAX UNDER ARTICLE
NINE-A OR TWENTY-TWO OF THIS  CHAPTER  SHALL  BE  ALLOWED  AN  EDUCATION
INVESTMENT  TAX  CREDIT  AGAINST  SUCH  TAX,  PURSUANT TO THE PROVISIONS
REFERENCED IN SUBDIVISION (L) OF THIS SECTION, WITH RESPECT TO QUALIFIED
CONTRIBUTIONS MADE DURING THE TAXABLE YEAR.
  (C) AMOUNT OF CREDIT. THE AMOUNT OF THE CREDIT SHALL  BE  SEVENTY-FIVE
PERCENT  OF  THE TAXPAYER'S TOTAL QUALIFIED CONTRIBUTIONS, CAPPED AT ONE
MILLION DOLLARS.  A TAXPAYER THAT IS A PARTNER IN A PARTNERSHIP,  MEMBER
OF  A LIMITED LIABILITY COMPANY OR SHAREHOLDER IN AN S CORPORATION SHALL
BE ALLOWED TO CLAIM ITS PRO RATA SHARE OF THE CREDIT EARNED BY THE PART-
NERSHIP, LIMITED LIABILITY COMPANY OR S CORPORATION, PROVIDED THAT  SUCH
A TAXPAYER SHALL NOT CLAIM CREDIT IN EXCESS OF THE LIMIT IMPOSED BY THIS
SUBDIVISION.
  (D) INFORMATION TO BE POSTED ON THE DEPARTMENT'S WEBSITE.  THE COMMIS-
SIONER SHALL MAINTAIN ON THE DEPARTMENT'S WEBSITE A RUNNING TOTAL OF THE
AMOUNT  OF  AVAILABLE  CREDIT  FOR WHICH TAXPAYERS MAY APPLY PURSUANT TO
THIS SECTION.  SUCH RUNNING TOTAL SHALL BE UPDATED  ON  A  DAILY  BASIS.

A. 2551--A                          5

ADDITIONALLY,  THE  COMMISSIONER  SHALL  MAINTAIN  ON  THE  DEPARTMENT'S
WEBSITE A LIST OF THE SCHOOL IMPROVEMENT ORGANIZATIONS, LOCAL  EDUCATION
FUNDS  AND  EDUCATIONAL  SCHOLARSHIP  ORGANIZATIONS  APPROVED  TO  ISSUE
CERTIFICATES OF RECEIPT PURSUANT TO ARTICLE TWENTY-FIVE OF THE EDUCATION
LAW.  THE COMMISSIONER SHALL ALSO MAINTAIN ON THE DEPARTMENT'S WEBSITE A
LIST  OF  PUBLIC  EDUCATION  ENTITIES, SCHOOL IMPROVEMENT ORGANIZATIONS,
LOCAL EDUCATION FUNDS AND EDUCATIONAL  SCHOLARSHIP  ORGANIZATIONS  WHOSE
APPROVAL  TO  ISSUE  CERTIFICATES OF RECEIPT HAS BEEN REVOKED ALONG WITH
THE DATE OF REVOCATION.
  (E) APPLICATIONS FOR CONTRIBUTION AUTHORIZATION CERTIFICATES. PRIOR TO
MAKING A CONTRIBUTION TO A PUBLIC EDUCATION ENTITY,  SCHOOL  IMPROVEMENT
ORGANIZATION, LOCAL EDUCATION FUND, OR EDUCATIONAL SCHOLARSHIP ORGANIZA-
TION,  THE  TAXPAYER  SHALL  APPLY  TO THE DEPARTMENT FOR A CONTRIBUTION
AUTHORIZATION CERTIFICATE FOR SUCH CONTRIBUTION. SUCH APPLICATION  SHALL
BE  IN THE FORM AND MANNER PRESCRIBED BY THE DEPARTMENT.  THE DEPARTMENT
MAY ALLOW TAXPAYERS TO MAKE MULTIPLE  APPLICATIONS  ON  THE  SAME  FORM,
PROVIDED  THAT  EACH  CONTRIBUTION  LISTED  ON SUCH APPLICATION SHALL BE
TREATED AS A SEPARATE APPLICATION AND THAT THE  DEPARTMENT  SHALL  ISSUE
SEPARATE  CONTRIBUTION AUTHORIZATION CERTIFICATES FOR EACH SUCH APPLICA-
TION.
  (F) CONTRIBUTION AUTHORIZATION CERTIFICATES. 1.  ISSUANCE  OF  CERTIF-
ICATES.  THE COMMISSIONER SHALL ISSUE CONTRIBUTION AUTHORIZATION CERTIF-
ICATES  IN  TWO PHASES.   IN PHASE ONE, WHICH BEGINS ON THE FIRST DAY OF
JANUARY AND ENDS ON THE THIRTY-FIRST DAY OF  JANUARY,  THE  COMMISSIONER
SHALL  ACCEPT  APPLICATIONS FOR CONTRIBUTION AUTHORIZATION CERTIFICATES.
COMMENCING AFTER THE FIFTH DAY OF FEBRUARY, THE COMMISSIONER SHALL ISSUE
CONTRIBUTION AUTHORIZATION CERTIFICATES FOR APPLICATIONS RECEIVED DURING
PHASE ONE, PROVIDED THAT IF THE AGGREGATE TOTAL OF THE CONTRIBUTIONS FOR
WHICH APPLICATIONS HAVE BEEN  RECEIVED  DURING  PHASE  ONE  EXCEEDS  THE
AMOUNT OF THE CREDIT CAP IN SUBDIVISION (H) OF THIS SECTION, THE AUTHOR-
IZED  CONTRIBUTION  AMOUNT  LISTED  ON  EACH  CONTRIBUTION AUTHORIZATION
CERTIFICATE SHALL EQUAL THE PRO-RATA SHARE OF THE CREDIT CAP.    IF  THE
CREDIT  CAP  IS  NOT EXCEEDED, PHASE TWO COMMENCES ON FEBRUARY FIRST AND
ENDS ON DECEMBER THIRTY-FIRST. THE COMMISSIONER SHALL ISSUE CONTRIBUTION
AUTHORIZATION CERTIFICATES ON A FIRST-COME, FIRST SERVE BASIS BASED UPON
THE DATE THE DEPARTMENT RECEIVED THE  TAXPAYER'S  APPLICATION  FOR  SUCH
CERTIFICATE.    CONTRIBUTION AUTHORIZATION CERTIFICATES FOR APPLICATIONS
RECEIVED DURING PHASE ONE SHALL BE MAILED NO LATER  THAN  THE  TWENTIETH
DAY  OF  FEBRUARY.  CONTRIBUTION AUTHORIZATION CERTIFICATES FOR APPLICA-
TIONS RECEIVED DURING PHASE TWO SHALL BE MAILED WITHIN  TWENTY  DAYS  OF
RECEIPT  OF  SUCH APPLICATIONS.   PROVIDED HOWEVER, THAT NO CONTRIBUTION
AUTHORIZATION CERTIFICATES FOR APPLICATIONS RECEIVED  DURING  PHASE  TWO
SHALL BE ISSUED UNTIL ALL OF THE CONTRIBUTION AUTHORIZATION CERTIFICATES
FOR APPLICATIONS RECEIVED DURING PHASE ONE HAVE BEEN ISSUED.
  2.  CONTRIBUTION AUTHORIZATION CERTIFICATE CONTENTS. EACH CONTRIBUTION
AUTHORIZATION CERTIFICATE SHALL STATE (I) THE DATE SUCH CERTIFICATE  WAS
ISSUED,  (II)  THE  DATE BY WHICH THE AUTHORIZED CONTRIBUTIONS LISTED IN
THE CERTIFICATE MUST BE MADE, WHICH SHALL  BE  NO  LATER  THAN  DECEMBER
THIRTY-FIRST  OF  THE  YEAR  FOR  WHICH  THE  CONTRIBUTION AUTHORIZATION
CERTIFICATE WAS ISSUED, (III) THE TAXPAYER'S NAME AND ADDRESS, (IV)  THE
AMOUNT  OF  AUTHORIZED CONTRIBUTIONS, (V) THE CONTRIBUTION AUTHORIZATION
CERTIFICATE'S CERTIFICATE NUMBER, (VI)  THE  NAME  AND  ADDRESS  OF  THE
PUBLIC  EDUCATION  ENTITY, SCHOOL IMPROVEMENT ORGANIZATION, LOCAL EDUCA-
TION FUND OR EDUCATIONAL SCHOLARSHIP ORGANIZATION FOR WHICH THE TAXPAYER
MAY MAKE THE AUTHORIZED CONTRIBUTION, AND (VII)  ANY  OTHER  INFORMATION
THAT THE COMMISSIONER DEEMS NECESSARY.

A. 2551--A                          6

  3.  NOTIFICATION  OF  THE  ISSUANCE  OF  A  CONTRIBUTION AUTHORIZATION
CERTIFICATE. UPON ISSUANCE OF A CONTRIBUTION AUTHORIZATION  CERTIFICATE,
THE  COMMISSIONER SHALL NOTIFY THE EDUCATIONAL SCHOLARSHIP ORGANIZATION,
PUBLIC EDUCATION ENTITY, SCHOOL IMPROVEMENT ORGANIZATION OR LOCAL EDUCA-
TION  FUND OF THE ISSUANCE OF THE CONTRIBUTION AUTHORIZATION CERTIFICATE
TO A TAXPAYER.  SUCH NOTIFICATION SHALL INCLUDE (I) THE TAXPAYER'S  NAME
AND  ADDRESS,  (II) THE DATE SUCH CERTIFICATE WAS ISSUED, (III) THE DATE
BY WHICH THE AUTHORIZED CONTRIBUTION LISTED IN THE NOTIFICATION MUST  BE
MADE  BY  THE  TAXPAYER, (IV) THE AMOUNT OF THE AUTHORIZED CONTRIBUTION,
(V) CONTRIBUTION AUTHORIZATION CERTIFICATE, AND (VI) ANY OTHER  INFORMA-
TION THAT THE COMMISSIONER DEEMS NECESSARY.
  (G) CERTIFICATE OF RECEIPT. 1. IN GENERAL. NO PUBLIC EDUCATION ENTITY,
SCHOOL  IMPROVEMENT  ORGANIZATION,  LOCAL EDUCATION FUND, OR EDUCATIONAL
SCHOLARSHIP ORGANIZATION SHALL ISSUE A CERTIFICATE OF  RECEIPT  FOR  ANY
CONTRIBUTION  MADE  BY  A  TAXPAYER UNLESS SUCH PUBLIC EDUCATION ENTITY,
SCHOOL IMPROVEMENT ORGANIZATION, LOCAL EDUCATION  FUND,  OR  EDUCATIONAL
SCHOLARSHIP  ORGANIZATION  HAS  BEEN  APPROVED  TO ISSUE CERTIFICATES OF
RECEIPT PURSUANT TO ARTICLE TWENTY-FIVE OF THE EDUCATION LAW. NO  PUBLIC
EDUCATION ENTITY, SCHOOL IMPROVEMENT ORGANIZATION, LOCAL EDUCATION FUND,
OR  EDUCATIONAL  SCHOLARSHIP  ORGANIZATION  SHALL ISSUE A CERTIFICATE OF
RECEIPT FOR A CONTRIBUTION MADE BY A TAXPAYER UNLESS SUCH PUBLIC  EDUCA-
TION  ENTITY,  SCHOOL IMPROVEMENT ORGANIZATION, LOCAL EDUCATION FUND, OR
EDUCATIONAL  SCHOLARSHIP  ORGANIZATION  HAS  RECEIVED  NOTICE  FROM  THE
DEPARTMENT THAT THE DEPARTMENT ISSUED A CREDIT AUTHORIZATION CERTIFICATE
TO THE TAXPAYER FOR SUCH CONTRIBUTION.
  2. TIMELY CONTRIBUTION. IF A TAXPAYER MAKES AN AUTHORIZED CONTRIBUTION
TO  THE  PUBLIC EDUCATION ENTITY, SCHOOL IMPROVEMENT ORGANIZATION, LOCAL
EDUCATION FUND, OR EDUCATIONAL SCHOLARSHIP ORGANIZATION SET FORTH ON THE
AUTHORIZATION CERTIFICATE ISSUED TO THE TAXPAYER NO LATER THAN THE  DATE
BY  WHICH  SUCH  AUTHORIZED  CONTRIBUTION  IS  REQUIRED TO BE MADE, SUCH
PUBLIC EDUCATION ENTITY, SCHOOL IMPROVEMENT ORGANIZATION,  LOCAL  EDUCA-
TION  FUND, OR EDUCATIONAL SCHOLARSHIP ORGANIZATION SHALL, WITHIN THIRTY
DAYS OF RECEIPT OF THE AUTHORIZED CONTRIBUTION, ISSUE TO THE TAXPAYER  A
WRITTEN  CERTIFICATE OF RECEIPT; PROVIDED, HOWEVER, THAT IF THE TAXPAYER
CONTRIBUTES AN AMOUNT THAT IS LESS THAN THE AMOUNT LISTED ON THE TAXPAY-
ER'S CONTRIBUTION AUTHORIZATION CERTIFICATE, THE TAXPAYER SHALL  NOT  BE
ISSUED A CERTIFICATE OF RECEIPT FOR SUCH CONTRIBUTION.
  3.  CERTIFICATE OF RECEIPT CONTENTS. EACH CERTIFICATE OF RECEIPT SHALL
STATE (I) THE NAME AND ADDRESS OF THE ISSUING PUBLIC  EDUCATION  ENTITY,
SCHOOL  IMPROVEMENT  ORGANIZATION,  LOCAL EDUCATION FUND, OR EDUCATIONAL
SCHOLARSHIP ORGANIZATION, (II) THE TAXPAYER'S NAME  AND  ADDRESS,  (III)
THE DATE FOR EACH CONTRIBUTION, (IV) THE AMOUNT OF EACH CONTRIBUTION AND
THE CORRESPONDING CONTRIBUTION AUTHORIZATION CERTIFICATE NUMBER, (V) THE
TOTAL  AMOUNT  OF CONTRIBUTIONS, AND (VI) ANY OTHER INFORMATION THAT THE
COMMISSIONER MAY DEEM NECESSARY.
  4. NOTIFICATION TO THE DEPARTMENT FOR THE ISSUANCE OF A CERTIFICATE OF
RECEIPT. UPON THE ISSUANCE OF A  CERTIFICATE  OF  RECEIPT,  THE  ISSUING
PUBLIC  EDUCATION  ENTITY, SCHOOL IMPROVEMENT ORGANIZATION, LOCAL EDUCA-
TION FUND, OR EDUCATIONAL SCHOLARSHIP ORGANIZATION SHALL, WITHIN  THIRTY
DAYS  OF ISSUING THE CERTIFICATE OF RECEIPT, PROVIDE THE DEPARTMENT WITH
NOTIFICATION OF THE ISSUANCE OF SUCH CERTIFICATE IN THE FORM AND  MANNER
PRESCRIBED BY THE DEPARTMENT.
  5. NOTIFICATION TO THE DEPARTMENT OF THE NON-ISSUANCE OF A CERTIFICATE
OF  RECEIPT.  EACH PUBLIC EDUCATION ENTITY, SCHOOL IMPROVEMENT ORGANIZA-
TION, LOCAL EDUCATION FUND, OR EDUCATIONAL SCHOLARSHIP ORGANIZATION THAT
RECEIVED NOTIFICATION FROM THE DEPARTMENT PURSUANT TO SUBDIVISION (D) OF

A. 2551--A                          7

THIS SECTION REGARDING THE  ISSUANCE  OF  A  CONTRIBUTION  AUTHORIZATION
CERTIFICATE  TO  A  TAXPAYER SHALL, WITHIN THIRTY DAYS OF THE EXPIRATION
DATE FOR SUCH  AUTHORIZED  CONTRIBUTION,  PROVIDE  NOTIFICATION  TO  THE
DEPARTMENT FOR EACH TAXPAYER THAT FAILED TO MAKE THE AUTHORIZED CONTRIB-
UTION  TO SUCH PUBLIC EDUCATION ENTITY, SCHOOL IMPROVEMENT ORGANIZATION,
LOCAL EDUCATION FUND, OR EDUCATIONAL  SCHOLARSHIP  ORGANIZATION  IN  THE
FORM AND MANNER PRESCRIBED BY THE DEPARTMENT.
  6.  FAILURE  TO NOTIFY THE DEPARTMENT. WITHIN THIRTY DAYS OF DISCOVERY
OF THE FAILURE OF ANY PUBLIC EDUCATION ENTITY, SCHOOL IMPROVEMENT ORGAN-
IZATION, LOCAL EDUCATION FUND, OR EDUCATIONAL  SCHOLARSHIP  ORGANIZATION
TO  COMPLY  WITH  THE NOTIFICATION REQUIREMENTS PRESCRIBED BY PARAGRAPHS
FOUR AND FIVE OF THIS SUBDIVISION, THE COMMISSIONER SHALL ISSUE A NOTICE
OF COMPLIANCE FAILURE TO SUCH ENTITY, PROGRAM FUND OR ORGANIZATION. SUCH
ENTITY, PROGRAM FUND OR ORGANIZATION SHALL HAVE  THIRTY  DAYS  FROM  THE
DATE  OF  SUCH NOTICE TO MAKE THE NOTIFICATIONS PRESCRIBED BY PARAGRAPHS
FOUR AND FIVE OF THIS SUBDIVISION. SUCH PERIOD MAY BE  EXTENDED  FOR  AN
ADDITIONAL  THIRTY  DAYS UPON THE REQUEST OF THE ENTITY, PROGRAM FUND OR
ORGANIZATION. UPON THE EXPIRATION OF THE PERIOD FOR COMPLIANCE SET FORTH
IN THE NOTICE PRESCRIBED BY THIS PARAGRAPH, THE COMMISSIONER SHALL NOTI-
FY THE BOARD OF REGENTS AND THE  COMMISSIONER  OF  EDUCATION  THAT  SUCH
ENTITY,  PROGRAM  FUND  OR ORGANIZATION FAILED TO MAKE THE NOTIFICATIONS
PRESCRIBED BY PARAGRAPHS FOUR AND FIVE OF THIS SUBDIVISION.
  (H) CREDIT CAP. THE  MAXIMUM  PERMITTED  CREDITS  UNDER  THIS  SECTION
AVAILABLE TO ALL TAXPAYERS FOR QUALIFIED CONTRIBUTIONS FOR CALENDAR YEAR
TWO  THOUSAND  SEVENTEEN SHALL BE ONE HUNDRED FIFTY MILLION DOLLARS.  IN
CALENDAR YEAR TWO THOUSAND EIGHTEEN, THE MAXIMUM PERMITTED CREDITS UNDER
THIS SECTION AVAILABLE TO ALL TAXPAYERS SHALL BE TWO HUNDRED TWENTY-FIVE
MILLION DOLLARS PLUS ANY AMOUNTS THAT ARE REQUIRED TO BE  ADDED  TO  THE
CAP  PURSUANT TO SUBDIVISION (I) OF THIS SECTION.  FOR CALENDAR YEAR TWO
THOUSAND NINETEEN AND EACH CALENDAR YEAR THEREAFTER, THE MAXIMUM PERMIT-
TED CREDITS UNDER THIS SECTION AVAILABLE TO ALL TAXPAYERS SHALL BE THREE
HUNDRED MILLION DOLLARS, PLUS ANY AMOUNTS THAT ARE REQUIRED TO BE  ADDED
TO  THE  CAP  PURSUANT  TO SUBDIVISION (I) OF THIS SECTION.  THE MAXIMUM
PERMITTED CREDITS UNDER THIS SECTION FOR QUALIFIED  CONTRIBUTIONS  SHALL
BE ALLOCATED FIFTY PERCENT TO PUBLIC EDUCATION ENTITIES, SCHOOL IMPROVE-
MENT  ORGANIZATIONS,  AND  LOCAL  EDUCATION  FUNDS  AND FIFTY PERCENT TO
EDUCATIONAL SCHOLARSHIP ORGANIZATIONS.
  (I) ADDITIONS TO THE CREDIT CAP. UNISSUED CERTIFICATES OF RECEIPT. ANY
AMOUNTS FOR WHICH THE DEPARTMENT RECEIVES NOTIFICATION  OF  NON-ISSUANCE
OF  A  CERTIFICATE  OF  RECEIPT  SHALL BE ADDED TO THE CAP PRESCRIBED IN
SUBDIVISION (H) OF THIS SECTION FOR THE IMMEDIATELY FOLLOWING YEAR.
  (J) REGULATIONS. THE COMMISSIONER IS HEREBY AUTHORIZED  TO  PROMULGATE
AND  ADOPT ON AN EMERGENCY BASIS REGULATIONS NECESSARY FOR THE IMPLEMEN-
TATION OF THIS SECTION.
  (K) REPORTS. 1. REPORTS TO THE COMMISSIONER. ON OR BEFORE THE LAST DAY
OF FEBRUARY FOR EACH CALENDAR YEAR, EACH PUBLIC EDUCATION ENTITY, SCHOOL
IMPROVEMENT ORGANIZATION, LOCAL EDUCATION FUND, AND EDUCATIONAL SCHOLAR-
SHIP ORGANIZATION THAT ISSUED ONE OR MORE CERTIFICATES OF RECEIPT  SHALL
REPORT  TO  THE  COMMISSIONER THE NUMBER OF SUCH CERTIFICATES ISSUED AND
THE AGGREGATE AMOUNT OF QUALIFIED CONTRIBUTIONS  MADE  TO  SUCH  ENTITY,
FUND, OR ORGANIZATION DURING THE IMMEDIATELY PRECEDING CALENDAR YEAR.
  2.  JOINT  ANNUAL  REPORT.  ON OR BEFORE THE LAST DAY OF JUNE FOR EACH
CALENDAR YEAR, FOR THE IMMEDIATELY PRECEDING YEAR, THE COMMISSIONER  AND
THE  COMMISSIONER  OF EDUCATION SHALL JOINTLY SUBMIT A WRITTEN REPORT TO
THE GOVERNOR, THE TEMPORARY PRESIDENT OF THE SENATE, THE SPEAKER OF  THE
ASSEMBLY,  THE CHAIRMAN OF THE SENATE FINANCE COMMITTEE AND THE CHAIRMAN

A. 2551--A                          8

OF THE ASSEMBLY WAYS AND MEANS  COMMITTEE  REGARDING  THE  CREDIT.  SUCH
REPORT  SHALL  CONTAIN  INFORMATION  FOR ARTICLES NINE-A AND TWENTY-TWO,
RESPECTIVELY, REGARDING: (I) THE NUMBER OF APPLICATIONS  RECEIVED;  (II)
THE  NUMBER  OF  AND  AGGREGATE  VALUE OF THE CONTRIBUTION AUTHORIZATION
CERTIFICATES ISSUED FOR  CONTRIBUTIONS  TO  PUBLIC  EDUCATION  ENTITIES,
SCHOOL IMPROVEMENT ORGANIZATIONS, LOCAL EDUCATION FUNDS, AND SCHOLARSHIP
ORGANIZATIONS,  RESPECTIVELY;  (III)  THE  GEOGRAPHICAL  DISTRIBUTION BY
COUNTY OF (A) THE APPLICATIONS FOR  CONTRIBUTION  AUTHORIZATION  CERTIF-
ICATES,  DISTRIBUTION  BY  COUNTY  OF (B) THE PUBLIC EDUCATION ENTITIES,
SCHOOL IMPROVEMENT ORGANIZATIONS, LOCAL EDUCATION FUNDS, AND EDUCATIONAL
SCHOLARSHIP ORGANIZATIONS LISTED ON  THE  ISSUED  CONTRIBUTION  AUTHORI-
ZATION   CERTIFICATES;  AND  (IV)  INFORMATION,  INCLUDING  GEOGRAPHICAL
DISTRIBUTION BY COUNTY, OF THE NUMBER OF ELIGIBLE PUPILS  THAT  RECEIVED
SCHOLARSHIPS,  THE  NUMBER OF ELIGIBLE PUPILS THAT RESIDE IN A HOUSEHOLD
THAT HAS AN INCOME NOT TO EXCEED ONE HUNDRED FIFTY PERCENT OF THE INCOME
QUALIFICATION REQUIRED FOR THE REDUCED PRICE SCHOOL  LUNCHES  UNDER  THE
NATIONAL  SCHOOL  LUNCH ACT, THE NUMBER OF QUALIFIED SCHOOLS ATTENDED BY
ELIGIBLE PUPILS THAT RECEIVED SUCH SCHOLARSHIPS, AND THE  AVERAGE  VALUE
OF  SCHOLARSHIPS  RECEIVED BY SUCH ELIGIBLE PUPILS. THE COMMISSIONER AND
DESIGNATED EMPLOYEES OF THE STATE EDUCATION  DEPARTMENT,  THE  BOARD  OF
REGENTS  AND  ALL MEMBERS OF THE BOARD OF REGENTS, INCLUDING THE COMMIS-
SIONER OF EDUCATION AND DESIGNATED  EMPLOYEES  OF  THE  STATE  EDUCATION
DEPARTMENT,  SHALL  BE  ALLOWED  AND  ARE DIRECTED TO SHARE AND EXCHANGE
INFORMATION REGARDING THE SCHOOL IMPROVEMENT ORGANIZATIONS, LOCAL EDUCA-
TION FUNDS AND EDUCATIONAL SCHOLARSHIP ORGANIZATIONS  THAT  APPLIED  FOR
APPROVAL  TO  BE  AUTHORIZED TO RECEIVE QUALIFIED CONTRIBUTIONS; AND THE
PUBLIC  EDUCATION  ENTITIES,  SCHOOL  IMPROVEMENT  ORGANIZATIONS,  LOCAL
EDUCATION FUNDS, AND EDUCATIONAL SCHOLARSHIP ORGANIZATIONS AUTHORIZED TO
ISSUE  CERTIFICATES  OF  RECEIPT,  INCLUDING INFORMATION CONTAINED IN OR
DERIVED FROM APPLICATION FORMS AND REPORTS SUBMITTED TO THE STATE EDUCA-
TION DEPARTMENT OR BOARD OF REGENTS.
  (L) 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-B; SUBDIVISION 49;
  2. ARTICLE 22: SECTION 606; SUBSECTIONS (I) AND (CCC).
  S  4.  Paragraph (b) of subdivision 9 of section 208 of the tax law is
amended by adding a new subparagraph 22 to read as follows:
  (22) THE AMOUNT OF ANY  DEDUCTION  ALLOWED  PURSUANT  TO  SECTION  ONE
HUNDRED SEVENTY OF THE INTERNAL REVENUE CODE FOR WHICH CREDIT IS CLAIMED
PURSUANT  TO SUBDIVISION FORTY-NINE OF SECTION TWO HUNDRED TEN-B OF THIS
ARTICLE.
  S 5. Section 210-B of the tax law is amended by adding a new  subdivi-
sion 49 to read as follows:
  49.  EDUCATION  INVESTMENT  TAX  CREDIT.  (A)  ALLOWANCE  OF CREDIT. A
TAXPAYER SHALL BE ALLOWED A  CREDIT,  TO  BE  COMPUTED  AS  PROVIDED  IN
SECTION FORTY-TWO OF THIS CHAPTER, AGAINST THE TAX IMPOSED BY THIS ARTI-
CLE.
  (B)  APPLICATION  OF CREDIT. THE CREDIT ALLOWED UNDER THIS SUBDIVISION
FOR ANY TAXABLE YEAR SHALL NOT REDUCE THE TAX DUE FOR THAT YEAR TO  LESS
THAN  THE  HIGHER OF THE AMOUNTS PRESCRIBED IN PARAGRAPH (D) OF SUBDIVI-
SION ONE OF SECTION TWO HUNDRED TEN OF THIS ARTICLE.   HOWEVER,  IF  THE
AMOUNT  OF  CREDIT ALLOWED UNDER THIS SUBDIVISION FOR QUALIFIED CONTRIB-
UTIONS FOR ANY TAXABLE YEAR REDUCES THE TAX TO SUCH AMOUNT,  ANY  AMOUNT
OF  CREDIT  THUS NOT DEDUCTIBLE IN SUCH TAXABLE YEAR MAY BE CARRIED OVER
TO THE SUCCEEDING FIVE YEARS AND MAY BE DEDUCTED FROM THE TAXPAYER'S TAX
FOR SUCH YEAR OR YEARS.

A. 2551--A                          9

  S 6. Subparagraph (B) of paragraph 1 of subsection (i) of section  606
of  the  tax  law  is  amended  by  adding a new clause (xli) to read as
follows:
(XLI) EDUCATION INVESTMENT           AMOUNT OF CREDIT UNDER SUBDIVISION
TAX CREDIT UNDER SUBSECTION (CCC)    FORTY-NINE OF SECTION TWO HUNDRED
                                     TEN-B
  S  7. Section 606 of the tax law is amended by adding a new subsection
(w) to read as follows:
  (W) INSTRUCTIONAL MATERIALS AND SUPPLIES CREDIT. (1) FOR TAXABLE YEARS
BEGINNING ON AND AFTER JANUARY FIRST, TWO THOUSAND SEVENTEEN, A TAXPAYER
SHALL BE ALLOWED A CREDIT IN THE AMOUNT PAID BY THE TAXPAYER DURING  THE
TAXABLE  YEAR  FOR  INSTRUCTIONAL MATERIALS AND SUPPLIES WITH RESPECT TO
CLASSROOM BASED INSTRUCTION  IN  A  QUALIFIED  SCHOOL,  OR  TWO  HUNDRED
DOLLARS,  WHICHEVER  IS LESS; PROVIDED THAT THE TAXPAYER IS A TEACHER OR
INSTRUCTOR IN A QUALIFIED SCHOOL, AS DEFINED  IN  SECTION  FORTY-TWO  OF
THIS  CHAPTER, FOR AT LEAST NINE HUNDRED HOURS DURING A SCHOOL YEAR. FOR
PURPOSES OF THIS SUBSECTION, THE TERM  "MATERIALS  AND  SUPPLIES"  MEANS
AMOUNTS PAID FOR INSTRUCTIONAL MATERIALS OR SUPPLIES THAT ARE DESIGNATED
FOR CLASSROOM USE IN ANY QUALIFIED SCHOOL.
  (2) A HUSBAND AND WIFE WHO FILE SEPARATE RETURNS FOR A TAXABLE YEAR IN
WHICH  THEY COULD HAVE FILED A JOINT RETURN MAY EACH CLAIM ONLY ONE-HALF
OF THE TAX CREDIT THAT WOULD HAVE BEEN ALLOWED FOR A JOINT RETURN.
  (3) IF THE AMOUNT OF THE CREDIT ALLOWED UNDER THIS SUBSECTION FOR  ANY
TAXABLE  YEAR  SHALL EXCEED THE TAXPAYER'S TAX FOR SUCH YEAR, THE EXCESS
SHALL BE TREATED AS AN OVERPAYMENT OF TAX TO BE CREDITED OR REFUNDED  IN
ACCORDANCE WITH THE PROVISIONS OF SECTION SIX HUNDRED EIGHTY-SIX OF THIS
ARTICLE, PROVIDED, HOWEVER, THAT NO INTEREST SHALL BE PAID THEREON.
  S 8.  Section 606 of the tax law is amended by adding a new subsection
(ccc) to read as follows:
  (CCC)  EDUCATION  INVESTMENT  TAX  CREDIT.  (1) ALLOWANCE OF CREDIT. A
TAXPAYER SHALL BE ALLOWED A CREDIT TO BE COMPUTED AS PROVIDED IN SECTION
FORTY-TWO OF THIS CHAPTER, AGAINST THE TAX IMPOSED BY THIS ARTICLE.
  (2) APPLICATION OF CREDIT. IF THE AMOUNT OF THE CREDIT  ALLOWED  UNDER
THIS  SUBSECTION  FOR  ANY  QUALIFIED CONTRIBUTIONS FOR ANY TAXABLE YEAR
EXCEEDS THE TAXPAYER'S TAX FOR SUCH YEAR, THE EXCESS MAY BE CARRIED OVER
TO THE SUCCEEDING FIVE YEARS AND MAY BE DEDUCTED FROM THE TAXPAYER'S TAX
FOR SUCH YEAR OR YEARS.
  S 9. Subsection (c) of section 615 of the tax law is amended by adding
a new paragraph 9 to read as follows:
  (9) THE AMOUNT OF ANY FEDERAL DEDUCTION  FOR  CONTRIBUTIONS  MADE  FOR
WHICH  A  TAXPAYER  CLAIMS A CREDIT UNDER SUBSECTION (KK) OF SECTION SIX
HUNDRED SIX OF THIS ARTICLE.
  S 10. The education law is amended by adding a new article 25 to  read
as follows:
                               ARTICLE 25
                 EDUCATION INVESTMENT TAX CREDIT PROGRAM
SECTION 1209. SHORT TITLE.
        1210. DEFINITIONS.
        1211. APPROVAL TO ISSUE CERTIFICATES OF RECEIPT.
        1212. APPLICATIONS   FOR   APPROVAL  TO  ISSUE  CERTIFICATES  OF
                RECEIPT.
        1213. APPLICATION APPROVAL.
        1214. REVOCATION OF APPROVAL TO ISSUE CERTIFICATES OF RECEIPT.
        1215. REPORTING AND RECORDKEEPING.
        1216. JOINT ANNUAL REPORT.
        1217. COMMISSIONER; POWERS.

A. 2551--A                         10

  S 1209. SHORT TITLE. THIS ARTICLE SHALL BE KNOWN AND MAY BE  CITED  AS
THE "EDUCATION INVESTMENT TAX CREDIT PROGRAM".
  S  1210.  DEFINITIONS.  AS  USED  IN THIS ARTICLE, THE FOLLOWING TERMS
SHALL HAVE THE FOLLOWING MEANINGS:
  1. "AUTHORIZED CONTRIBUTION" MEANS THE CONTRIBUTION AMOUNT  LISTED  ON
THE CONTRIBUTION AUTHORIZATION CERTIFICATE ISSUED TO A TAXPAYER.
  2.  "CONTRIBUTION"  MEANS  A  DONATION PAID BY CASH, CHECK, ELECTRONIC
FUNDS TRANSFER, DEBIT CARD OR CREDIT CARD MADE BY  THE  TAXPAYER  DURING
THE TAX YEAR.
  3.  "EDUCATIONAL PROGRAM" MEANS AN ACADEMIC PROGRAM OF A PUBLIC SCHOOL
THAT ENHANCES THE CURRICULUM OR ACADEMIC PROGRAM OF THE  PUBLIC  SCHOOL,
OR  PROVIDES  OR  EXPANDS  A PRE-KINDERGARTEN PROGRAM OR AN AFTER SCHOOL
PROGRAM TO THE PUBLIC SCHOOL.  FOR  PURPOSES  OF  THIS  DEFINITION,  THE
INSTRUCTION,  MATERIALS,  PROGRAMS  OR  OTHER  ACTIVITIES  OFFERED BY OR
THROUGH AN EDUCATIONAL PROGRAM MAY INCLUDE, BUT ARE NOT LIMITED TO,  THE
FOLLOWING FEATURES: (A) INSTRUCTION OR MATERIALS PROMOTING HEALTH, PHYS-
ICAL  EDUCATION,  AND FAMILY AND CONSUMER SCIENCES; LITERARY, PERFORMING
AND VISUAL ARTS; MATHEMATICS, SOCIAL STUDIES, TECHNOLOGY AND  SCIENTIFIC
ACHIEVEMENT;  (B) INSTRUCTION OR PROGRAMMING TO MEET THE EDUCATION NEEDS
OF AT-RISK STUDENTS OR STUDENTS WITH DISABILITIES, INCLUDING TUTORING OR
COUNSELING; OR (C) USE OF SPECIALIZED INSTRUCTIONAL MATERIALS,  INSTRUC-
TORS OR INSTRUCTION NOT PROVIDED BY A PUBLIC SCHOOL.
  4. "EDUCATIONAL SCHOLARSHIP ORGANIZATION" MEANS A NOT-FOR-PROFIT ENTI-
TY WHICH (I) IS EXEMPT FROM TAXATION UNDER PARAGRAPH THREE OF SUBSECTION
(C)  OF  SECTION  FIVE  HUNDRED  ONE  OF THE INTERNAL REVENUE CODE, (II)
COMMITS FOR THE EXPENDITURE OF OR DESIGNATES AT LEAST NINETY PERCENT  OF
THE  REVENUE  FROM  QUALIFIED CONTRIBUTIONS RECEIVED DURING THE CALENDAR
YEAR AND ANY INCOME DERIVED FROM QUALIFIED  CONTRIBUTIONS  FOR  SCHOLAR-
SHIPS, (III) PROVIDES MORE THAN FIFTY PERCENT OF ITS SCHOLARSHIPS DURING
A CALENDAR YEAR TO ELIGIBLE PUPILS WHO RESIDE IN A HOUSEHOLD THAT HAS AN
INCOME  NOT TO EXCEED ONE HUNDRED FIFTY PERCENT OF THE INCOME QUALIFICA-
TION REQUIRED FOR THE REDUCED PRICE SCHOOL LUNCHES  UNDER  THE  NATIONAL
SCHOOL  LUNCH  ACT,  PROVIDED HOWEVER FOR THE PURPOSES OF AN EDUCATIONAL
SCHOLARSHIP ORGANIZATION FULFILLING  SUCH  REQUIREMENT,  AN  EDUCATIONAL
SCHOLARSHIP ORGANIZATION MAY ENTER INTO AN AGREEMENT WITH ANOTHER EDUCA-
TIONAL SCHOLARSHIP ORGANIZATION OR ORGANIZATIONS TO JOINTLY REPORT THEIR
SCHOLARSHIP  INFORMATION  TO  MEET  SUCH  REQUIREMENT; (IV) DEPOSITS AND
HOLDS QUALIFIED CONTRIBUTIONS AND  ANY  INCOME  DERIVED  FROM  QUALIFIED
CONTRIBUTIONS  IN  AN  ACCOUNT  THAT IS SEPARATE FROM THE ORGANIZATION'S
OPERATING OR OTHER FUNDS UNTIL SUCH QUALIFIED  CONTRIBUTIONS  OR  INCOME
ARE  WITHDRAWN FOR USE, AND (V) PROVIDES SCHOLARSHIPS TO ELIGIBLE PUPILS
FOR USE AT NOT FEWER THAN THREE NON-PUBLIC SCHOOLS.
  5. "ELIGIBLE PUPIL" MEANS A CHILD WHO (I) IS A RESIDENT OF THIS STATE,
(II) IS SCHOOL AGE IN ACCORDANCE WITH SUBDIVISION ONE OF  SECTION  THIR-
TY-TWO  HUNDRED  TWO  OF  THIS CHAPTER OR WHO IS FOUR YEARS OF AGE ON OR
BEFORE DECEMBER FIRST OF THE YEAR  IN  WHICH  THEY  ARE  ENROLLED  IN  A
PRE-KINDERGARTEN  PROGRAM,  (III) ATTENDS OR IS ABOUT TO ATTEND A QUALI-
FIED SCHOOL, AND (IV)  RESIDES  IN  A  HOUSEHOLD  WHICH  HAS  A  FEDERAL
ADJUSTED  GROSS  INCOME  OF  TWO HUNDRED FIFTY THOUSAND DOLLARS OR LESS,
PROVIDED HOWEVER, FOR HOUSEHOLDS WITH THREE OR MORE DEPENDENT  CHILDREN,
SUCH INCOME LEVEL SHALL BE INCREASED BY TEN THOUSAND DOLLARS PER DEPEND-
ENT  CHILD  IN EXCESS OF TWO CHILDREN, NOT TO EXCEED THREE HUNDRED THOU-
SAND DOLLARS.
  6. "LOCAL EDUCATION FUND" MEANS A NOT-FOR-PROFIT ENTITY WHICH  (I)  IS
EXEMPT  FROM TAXATION UNDER PARAGRAPH THREE OF SUBSECTION (C) OF SECTION
FIVE HUNDRED ONE OF THE INTERNAL REVENUE CODE, (II) IS  ESTABLISHED  FOR

A. 2551--A                         11

THE PURPOSE OF SUPPORTING AT LEAST ONE PUBLIC SCHOOL, OR A PUBLIC SCHOOL
DISTRICT,  (III)  USES AT LEAST NINETY PERCENT OF THE QUALIFIED CONTRIB-
UTIONS RECEIVED DURING THE CALENDAR YEAR AND  ANY  INCOME  DERIVED  FROM
SUCH  QUALIFIED CONTRIBUTIONS TO SUPPORT THE PUBLIC SCHOOL OR SCHOOLS OR
PUBLIC SCHOOL DISTRICT OR DISTRICTS THAT SUCH FUND HAS BEEN  ESTABLISHED
TO  SUPPORT, AND (IV) DEPOSITS AND HOLDS QUALIFIED CONTRIBUTIONS AND ANY
INCOME DERIVED FROM QUALIFIED CONTRIBUTIONS IN AN ACCOUNT THAT IS  SEPA-
RATE  FROM  THE  FUND'S  OPERATING  OR  OTHER FUNDS UNTIL SUCH QUALIFIED
CONTRIBUTIONS OR INCOME ARE WITHDRAWN FOR USE.
  7.  "NON-PUBLIC  SCHOOL"  MEANS  ANY  NOT-FOR-PROFIT  PRE-KINDERGARTEN
PROGRAM OR ELEMENTARY, SECONDARY SECTARIAN OR NONSECTARIAN SCHOOL, OTHER
THAN  A  PUBLIC  SCHOOL,  THAT  IS  PROVIDING INSTRUCTION AT ONE OR MORE
LOCATIONS TO AN ELIGIBLE PUPIL IN ACCORDANCE  WITH  SUBDIVISION  TWO  OF
SECTION THIRTY-TWO HUNDRED FOUR OF THIS CHAPTER.
  8.  "PUBLIC  EDUCATION  ENTITY"  MEANS  A  PUBLIC SCHOOL DISTRICT OR A
PUBLIC SCHOOL, PROVIDED THAT  SUCH  PUBLIC  SCHOOL  DISTRICT  OR  PUBLIC
SCHOOL DEPOSITS AND HOLDS QUALIFIED CONTRIBUTIONS AND ANY INCOME DERIVED
FROM  QUALIFIED  CONTRIBUTIONS  IN  AN ACCOUNT THAT IS SEPARATE FROM THE
PUBLIC SCHOOL OR PUBLIC SCHOOL DISTRICT'S OPERATING OR OTHER FUNDS UNTIL
SUCH QUALIFIED CONTRIBUTIONS OR INCOME ARE WITHDRAWN FOR USE FROM  OPER-
ATING OR OTHER FUNDS AND IS APPROVED TO RECEIVE AUTHORIZED CONTRIBUTIONS
AND ISSUE CERTIFICATES OF RECEIPT PURSUANT TO THIS ARTICLE.
  9.  "PUBLIC  SCHOOL"  MEANS ANY FREE ELEMENTARY OR SECONDARY SCHOOL IN
THIS STATE PURSUANT TO ARTICLE ELEVEN OF THE NEW YORK CONSTITUTION,  BUT
SHALL  NOT  INCLUDE  A CHARTER SCHOOL AUTHORIZED BY ARTICLE FIFTY-SIX OF
THIS CHAPTER.
  10. "QUALIFIED CONTRIBUTION" MEANS THE AUTHORIZED CONTRIBUTION MADE BY
A TAXPAYER TO A PUBLIC EDUCATION ENTITY, LOCAL  EDUCATION  FUND,  SCHOOL
IMPROVEMENT  DISTRICT  OR  EDUCATIONAL  SCHOLARSHIP ORGANIZATION THAT IS
LISTED ON THE  CONTRIBUTION  AUTHORIZATION  CERTIFICATE  ISSUED  TO  THE
TAXPAYER  AND  FOR  WHICH  THE  TAXPAYER  HAS  RECEIVED A CERTIFICATE OF
RECEIPT FROM SUCH ENTITY, FUND, OR ORGANIZATION.   A  CONTRIBUTION  DOES
NOT QUALIFY IF THE TAXPAYER DESIGNATES THE TAXPAYER'S CONTRIBUTION TO AN
ENTITY OR ORGANIZATION FOR THE DIRECT BENEFIT OF ANY PARTICULAR OR SPEC-
IFIED STUDENT.
  11.  "QUALIFIED  EDUCATOR"  MEANS  AN  INDIVIDUAL  WHO IS A TEACHER OR
INSTRUCTOR IN A QUALIFIED SCHOOL FOR AT LEAST NINE HUNDRED HOURS  DURING
A SCHOOL YEAR.
  12.  "QUALIFIED  SCHOOL"  MEANS  A  PUBLIC SCHOOL OR NON-PUBLIC SCHOOL
LOCATED IN THIS STATE.
  13. "SCHOLARSHIP" MEANS AN EDUCATIONAL SCHOLARSHIP  WHICH  PROVIDES  A
TUITION  GRANT AWARDED TO AN ELIGIBLE PUPIL TO ATTEND A QUALIFIED SCHOOL
IN AN AMOUNT NOT TO EXCEED THE TUITION CHARGED  TO  ATTEND  SUCH  SCHOOL
LESS  ANY  OTHER EDUCATIONAL SCHOLARSHIP RECEIVED BY SUCH ELIGIBLE PUPIL
OR HIS OR HER PARENT, PARENTS, LEGAL GUARDIAN  OR  LEGAL  GUARDIANS  FOR
SUCH  ELIGIBLE  PUPIL'S  TUITION;  PROVIDED,  HOWEVER, IN THE CASE OF AN
ELIGIBLE PUPIL ATTENDING A PUBLIC SCHOOL IN A  DISTRICT  OF  WHICH  SUCH
PUPIL  IS  NOT  A  RESIDENT,  THE  AMOUNT OF THE EDUCATIONAL SCHOLARSHIP
AWARDED MAY NOT EXCEED THE TUITION CHARGED BY THE PUBLIC SCHOOL PURSUANT
TO PARAGRAPH D OF SUBDIVISION FOUR OF SECTION THIRTY-TWO HUNDRED TWO  OF
THIS  CHAPTER  LESS  ANY  OTHER EDUCATIONAL SCHOLARSHIP OR TUITION GRANT
RECEIVED BY SUCH ELIGIBLE PUPIL OR HIS OR  HER  PARENT,  PARENTS,  LEGAL
GUARDIAN  OR LEGAL GUARDIANS FOR SUCH ELIGIBLE PUPIL'S TUITION, BUT ONLY
IF THE SCHOOL DISTRICT OF WHICH SUCH PUPIL IS A RESIDENT IS NOT REQUIRED
TO PAY FOR SUCH TUITION.

A. 2551--A                         12

  14. "SCHOOL IMPROVEMENT ORGANIZATION" MEANS  A  NOT-FOR-PROFIT  ENTITY
WHICH  (I)  IS  EXEMPT FROM TAXATION UNDER PARAGRAPH THREE OF SUBSECTION
(C) OF SECTION FIVE HUNDRED ONE OF THE INTERNAL REVENUE CODE, (II)  USES
AT  LEAST  NINETY PERCENT OF THE QUALIFIED CONTRIBUTIONS RECEIVED DURING
THE  CALENDAR  YEAR  AND ANY INCOME DERIVED FROM QUALIFIED CONTRIBUTIONS
DURING SUCH MONTHS TO ASSIST PUBLIC SCHOOLS OR PUBLIC  SCHOOL  DISTRICTS
LOCATED IN THIS STATE IN THEIR PROVISION OF EDUCATIONAL PROGRAMS, EITHER
BY  MAKING  CONTRIBUTIONS TO ONE OR MORE PUBLIC SCHOOLS OR PUBLIC SCHOOL
DISTRICTS LOCATED IN THIS STATE OR PROVIDING EDUCATIONAL PROGRAMS TO, OR
IN CONJUNCTION WITH,  ONE  OR  MORE  PUBLIC  SCHOOLS  OR  PUBLIC  SCHOOL
DISTRICTS  LOCATED  IN  THIS  STATE,  (III) DEPOSITS AND HOLDS QUALIFIED
CONTRIBUTIONS AND ANY INCOME DERIVED FROM QUALIFIED CONTRIBUTIONS IN  AN
ACCOUNT  THAT  IS  SEPARATE  FROM  THE ORGANIZATION'S OPERATING OR OTHER
FUNDS UNTIL SUCH QUALIFIED CONTRIBUTIONS OR  INCOME  ARE  WITHDRAWN  FOR
USE,  AND  (IV) IS APPROVED TO ISSUE CERTIFICATES OF RECEIPT PURSUANT TO
THIS ARTICLE. SUCH TERM INCLUDES A PRE-KINDERGARTEN PROGRAM OR  NOT-FOR-
PROFIT ENTITY THAT ALLOWS THE TAXPAYER TO CHOOSE TO DONATE TO A PROGRAM,
PROJECT  OR  INITIATIVE  IDENTIFIED BY A QUALIFIED EDUCATOR FOR USE IN A
PUBLIC SCHOOL.
  S 1211. APPROVAL TO ISSUE CERTIFICATES OF RECEIPT. 1.  PUBLIC  SCHOOLS
AND  PUBLIC  SCHOOL  DISTRICTS.  ALL  PUBLIC  SCHOOLS  AND PUBLIC SCHOOL
DISTRICTS SHALL BE APPROVED TO ISSUE CERTIFICATES OF  RECEIPT  PROVIDED,
THAT  A PUBLIC SCHOOL OR PUBLIC SCHOOL DISTRICT SHALL NOT BE APPROVED IF
EITHER (I) SUCH PUBLIC SCHOOL OR PUBLIC SCHOOL DISTRICT FAILS TO DEPOSIT
AND HOLD QUALIFIED CONTRIBUTIONS AND ANY INCOME DERIVED  FROM  QUALIFIED
CONTRIBUTIONS  IN  AN ACCOUNT THAT IS SEPARATE FROM THE SCHOOL OR SCHOOL
DISTRICT'S OPERATING OR OTHER FUNDS UNTIL SUCH  QUALIFIED  CONTRIBUTIONS
OR  INCOME  ARE  WITHDRAWN  FOR  USE,  OR  (II) THE BOARD OF REGENTS HAS
REVOKED SUCH APPROVAL FOR SUCH PUBLIC SCHOOL OR PUBLIC  SCHOOL  DISTRICT
PURSUANT TO SECTION TWELVE HUNDRED FOURTEEN OF THIS ARTICLE.
  2. SCHOOL IMPROVEMENT ORGANIZATIONS, EDUCATIONAL SCHOLARSHIP ORGANIZA-
TIONS  AND  LOCAL  EDUCATION  FUNDS. NO SCHOOL IMPROVEMENT ORGANIZATION,
EDUCATIONAL SCHOLARSHIP ORGANIZATION OR LOCAL EDUCATION FUND SHALL ISSUE
ANY CERTIFICATES OF RECEIPT WITHOUT FILING AN  APPLICATION  PURSUANT  TO
SECTION TWELVE HUNDRED TWELVE AND RECEIVING APPROVAL PURSUANT TO SECTION
TWELVE HUNDRED THIRTEEN OF THIS ARTICLE.
  S  1212.  APPLICATIONS  FOR APPROVAL TO ISSUE CERTIFICATES OF RECEIPT.
EACH SCHOOL IMPROVEMENT ORGANIZATION, EDUCATIONAL SCHOLARSHIP  ORGANIZA-
TION  AND  LOCAL EDUCATION FUND SHALL SUBMIT AN APPLICATION TO THE BOARD
OF REGENTS FOR APPROVAL TO ISSUE CERTIFICATES OF RECEIPT IN THE FORM AND
MANNER PRESCRIBED BY THE BOARD OF REGENTS, PROVIDED THAT  SUCH  APPLICA-
TION  SHALL  INCLUDE:  (1)  SUBMISSION OF DOCUMENTATION THAT SUCH SCHOOL
IMPROVEMENT ORGANIZATION, LOCAL EDUCATION FUND OR  EDUCATIONAL  SCHOLAR-
SHIP  ORGANIZATION  HAS BEEN GRANTED EXEMPTION FROM TAXATION UNDER PARA-
GRAPH THREE OF SUBSECTION (C) OF SECTION FIVE HUNDRED ONE OF THE  INTER-
NAL  REVENUE  CODE;  (2)  THE  MOST RECENT ANNUAL FINANCIAL AUDIT, WHICH
SHALL BE COMPLETED BY AN INDEPENDENT CERTIFIED PUBLIC ACCOUNTANT, AND  A
LIST OF NAMES AND ADDRESSES OF ALL MEMBERS OF THE GOVERNING BOARD OF THE
SCHOOL  IMPROVEMENT  ORGANIZATION,  LOCAL  EDUCATION FUND OR EDUCATIONAL
SCHOLARSHIP ORGANIZATION; AND (3) AN EDUCATIONAL  SCHOLARSHIP  ORGANIZA-
TION SHALL PROVIDE CRITERIA FOR THE AWARDING OF SCHOLARSHIPS TO ELIGIBLE
STUDENTS.  THE  BOARD  OF  REGENTS, COMMISSIONER OR DEPARTMENT SHALL NOT
REQUIRE ANY OTHER INFORMATION FOR SUCH APPLICATION EXCEPT AS  AUTHORIZED
IN THIS ARTICLE OR BY SECTION FORTY-TWO OF THE TAX LAW.
  S  1213.  APPLICATION APPROVAL. IN GENERAL. THE BOARD OF REGENTS SHALL
REVIEW EACH APPLICATION TO ISSUE CERTIFICATES  OF  RECEIPT  PURSUANT  TO

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THIS  ARTICLE. APPROVAL OR DENIAL OF AN APPLICATION SHALL BE MADE AT THE
NEXT SCHEDULED MEETING OF THE BOARD OF REGENTS THAT FOLLOWS  RECEIPT  OF
SUCH APPLICATION, BUT NOT LATER THAN THE NEXT MEETING THEREAFTER.
  S  1214.  REVOCATION OF APPROVAL TO ISSUE CERTIFICATES OF RECEIPT. THE
BOARD OF REGENTS, IN CONSULTATION WITH THE COMMISSIONER OF TAXATION  AND
FINANCE,  MAY  REVOKE THE APPROVAL OF A SCHOOL IMPROVEMENT ORGANIZATION,
EDUCATIONAL  SCHOLARSHIP  ORGANIZATION,  LOCAL  EDUCATION  FUND,  PUBLIC
SCHOOL OR PUBLIC SCHOOL DISTRICT TO ISSUE CERTIFICATES OF RECEIPT UPON A
FINDING  THAT  SUCH  ORGANIZATION,  FUND,  SCHOOL OR SCHOOL DISTRICT HAS
VIOLATED THIS ARTICLE  OR  SECTION  FORTY-TWO  OF  THE  TAX  LAW.  THESE
VIOLATIONS  SHALL  INCLUDE, BUT NOT BE LIMITED TO, ANY OF THE FOLLOWING:
(1) FAILURE  TO  MEET  THE  REQUIREMENTS  OF  THIS  ARTICLE  OR  SECTION
FORTY-TWO  OF THE TAX LAW, (2) THE FAILURE TO MAINTAIN FULL AND ADEQUATE
RECORDS WITH RESPECT TO THE RECEIPT OF QUALIFIED CONTRIBUTIONS, (3)  THE
FAILURE  TO SUPPLY SUCH RECORDS TO THE COMMISSIONER, DEPARTMENT OF TAXA-
TION AND FINANCE, THE DEPARTMENT OR THE BOARD OF REGENTS WHEN  REQUESTED
BY  THE  DEPARTMENT  OR  BOARD OF REGENTS, OR (4) THE FAILURE TO PROVIDE
NOTICE TO THE DEPARTMENT OF TAXATION AND  FINANCE  OF  THE  ISSUANCE  OR
NON-ISSUANCE OF CERTIFICATES OF RECEIPT PURSUANT TO SECTION FORTY-TWO OF
THE  TAX  LAW;  PROVIDED,  HOWEVER,  THAT THE BOARD OF REGENTS SHALL NOT
REVOKE APPROVAL PURSUANT TO THIS SECTION BASED UPON A VIOLATION  OF  TAX
LAW  UNLESS THE COMMISSIONER OF TAXATION AND FINANCE AGREES THAT REVOCA-
TION IS WARRANTED; AND PROVIDED FURTHER THAT THE BOARD OF REGENTS  SHALL
NOT  REVOKE APPROVAL PURSUANT TO THIS SECTION WHEN THE FAILURE TO COMPLY
IS DUE TO CLERICAL ERROR AND NOT NEGLIGENCE OR INTENTIONAL DISREGARD FOR
THE LAW.  WITHIN FIVE DAYS OF THE DETERMINATION REVOKING  APPROVAL,  THE
COMMISSIONER  SHALL PROVIDE NOTICE OF SUCH REVOCATION TO THE EDUCATIONAL
SCHOLARSHIP ORGANIZATION, SCHOOL IMPROVEMENT ORGANIZATION, LOCAL  EDUCA-
TION  FUND,  PUBLIC SCHOOL, OR PUBLIC SCHOOL DISTRICT AND TO THE DEPART-
MENT OF TAXATION AND FINANCE.
  S 1215. REPORTING AND RECORDKEEPING. 1.  REPORTING.  EACH  EDUCATIONAL
SCHOLARSHIP  ORGANIZATION, SCHOOL IMPROVEMENT ORGANIZATION, LOCAL EDUCA-
TION FUND, PUBLIC SCHOOL AND PUBLIC SCHOOL DISTRICT THAT RECEIVES QUALI-
FIED CONTRIBUTIONS SHALL REPORT TO THE COMMISSIONER  AND  THE  BOARD  OF
REGENTS  BY  THE LAST DAY OF FEBRUARY OF EACH CALENDAR YEAR. SUCH REPORT
SHALL BE IN THE FORM  AND  MANNER  PRESCRIBED  BY  THE  COMMISSIONER  IN
CONSULTATION  WITH  THE  BOARD OF REGENTS, WHICH SHALL INCLUDE AN ANNUAL
FINANCIAL AUDIT FROM AN  INDEPENDENT  CERTIFIED  PUBLIC  ACCOUNTANT  AND
SHALL  NOT  EXCEED THE REQUIREMENTS NECESSARY TO PRODUCE THE INFORMATION
PURSUANT TO SECTION TWELVE HUNDRED SIXTEEN OF THIS ARTICLE.
  2. RECORDKEEPING. EACH EDUCATIONAL  SCHOLARSHIP  ORGANIZATION,  SCHOOL
IMPROVEMENT ORGANIZATION, LOCAL EDUCATION FUND, PUBLIC SCHOOL AND PUBLIC
SCHOOL  DISTRICT  THAT  ISSUED AT LEAST ONE CERTIFICATE OF RECEIPT SHALL
MAINTAIN RECORDS INCLUDING (A) NOTIFICATIONS RECEIVED FROM  THE  DEPART-
MENT  OF  TAXATION AND FINANCE, (B) NOTIFICATIONS MADE TO THE DEPARTMENT
OF TAXATION AND FINANCE, (C) COPIES OF QUALIFIED CONTRIBUTIONS RECEIVED,
(D) COPIES OF THE DEPOSIT OF SUCH QUALIFIED CONTRIBUTIONS, (E) COPIES OF
ISSUED CERTIFICATES OF RECEIPT, (F) ANNUAL FINANCIAL STATEMENTS, (G)  IN
THE  CASE  OF  SCHOOL IMPROVEMENT ORGANIZATIONS, EDUCATIONAL SCHOLARSHIP
ORGANIZATIONS AND  LOCAL  EDUCATION  FUNDS,  THE  APPLICATION  SUBMITTED
PURSUANT  TO  SECTION  TWELVE  HUNDRED  TWELVE  OF  THIS ARTICLE AND THE
APPROVAL ISSUED BY THE BOARD OF REGENTS, AND (H) ANY  OTHER  INFORMATION
AS  PRESCRIBED  BY  REGULATION  PROMULGATED  BY THE COMMISSIONER OR RULE
PROMULGATED BY THE BOARD OF REGENTS.
  S 1216. JOINT ANNUAL REPORT. ON OR BEFORE THE LAST  DAY  OF  JUNE  FOR
EACH  CALENDAR  YEAR,  THE  COMMISSIONER OF TAXATION AND FINANCE AND THE

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COMMISSIONER, JOINTLY, SHALL SUBMIT A  WRITTEN  REPORT  AS  PROVIDED  IN
PARAGRAPH TWO OF SUBDIVISION (J) OF SECTION FORTY-TWO OF THE TAX LAW.
  S  1217. COMMISSIONER; POWERS. THE COMMISSIONER SHALL PROMULGATE ON AN
EMERGENCY BASIS REGULATIONS NECESSARY FOR  THE  IMPLEMENTATION  OF  THIS
SECTION.  THE  COMMISSIONER  SHALL  MAKE  ANY APPLICATION REQUIRED TO BE
FILED PURSUANT TO THIS ARTICLE AVAILABLE TO APPLICANTS WITHIN SIXTY DAYS
OF THE EFFECTIVE DATE OF THIS ARTICLE.
  S 11. The education law is amended by adding a new section  1503-a  to
read as follows:
  S  1503-A.  POWER  TO  ACCEPT AND SOLICIT GIFTS AND DONATIONS.  1. ALL
SCHOOL DISTRICTS ORGANIZED BY SPECIAL LAWS OR PURSUANT TO THE PROVISIONS
OF A GENERAL LAW ARE HEREBY AUTHORIZED AND EMPOWERED  TO  ACCEPT  GIFTS,
DONATIONS, AND CONTRIBUTIONS TO THE DISTRICT AND TO SOLICIT THE SAME.
  2. NOTWITHSTANDING ANY OTHER PROVISION OF THIS CHAPTER OR OF ANY OTHER
GENERAL  OR  SPECIAL  LAW  TO  THE  CONTRARY, THE RECEIPT OF SUCH GIFTS,
DONATIONS, CONTRIBUTIONS AND OTHER FUNDS, AND ANY INCOME DERIVED  THERE-
FROM,  SHALL  BE  DISREGARDED  FOR  THE  PURPOSES OF ALL APPORTIONMENTS,
COMPUTATIONS, AND DETERMINATIONS OF STATE AID.
  S 12. Severability. If any provision of this section or  the  applica-
tion  thereof to any person or circumstances is held invalid, such inva-
lidity shall not affect other provisions or applications of the  section
which  can be given effect without the invalid provision or application,
and to this end the provisions of this section are declared to be sever-
able.
  S 13. This act shall take effect immediately and shall apply to  taxa-
ble years beginning after December 31, 2016.