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

                                  6981

                       2013-2014 Regular Sessions

                          I N  A S S E M B L Y

                             April 29, 2013
                               ___________

Introduced  by  M.  of  A.  GABRYSZAK  --  read once and referred to the
  Committee on Ways and Means

AN ACT to amend the tax law, in  relation  to  establishing  a  business
  franchise  and  personal  income  tax  credit  for  natural  resources
  improvement projects upon farmlands and forestlands

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

  Section  1.  Subdivision 9 of section 208 of the tax law is amended by
adding a new paragraph (r) to read as follows:
  (R) IN THE EVENT THE TAXPAYER CLAIMS THE NATURAL RESOURCE  IMPROVEMENT
CREDIT FOR FARMLANDS AND FORESTLANDS ESTABLISHED PURSUANT TO SUBDIVISION
FORTY-SIX  OF SECTION TWO HUNDRED TEN OF THIS ARTICLE, ENTIRE NET INCOME
SHALL BE INCREASED BY THE AMOUNT OF ANY EXPENDITURES DEFINED IN INTERNAL
REVENUE CODE SECTION 175(C)(1) THAT THE TAXPAYER DEDUCTED FROM ITS TOTAL
NET INCOME ON ITS FEDERAL TAX RETURN FOR THE TAX YEAR.
  S 2. Section 210 of the tax law is amended by adding a new subdivision
46 to read as follows:
  46. NATURAL RESOURCE IMPROVEMENT CREDIT FOR FARMLANDS AND FORESTLANDS.
(A) ALLOWANCE OF CREDIT. FOR TAXABLE YEARS BEGINNING ON OR AFTER JANUARY
FIRST, TWO THOUSAND THIRTEEN, A  TAXPAYER  SHALL  BE  ALLOWED  A  CREDIT
AGAINST  THE  TAX  IMPOSED  BY  THIS  ARTICLE  IN  AN  AMOUNT  EQUAL  TO
TWENTY-FIVE PERCENT OF THE TAXPAYER'S ELIGIBLE EXPENDITURES  DURING  THE
TAX YEAR FOR A NATURAL RESOURCES IMPROVEMENT PROJECT. PROVIDED, HOWEVER,
THAT  THE  CREDIT  GRANTED  FOR ANY NATURAL RESOURCE IMPROVEMENT PROJECT
PURSUANT TO THIS SUBDIVISION SHALL NOT EXCEED FIFTY THOUSAND DOLLARS.
  (B) DEFINITIONS. FOR THE PURPOSES OF THIS SUBDIVISION,  THE  FOLLOWING
DEFINITIONS SHALL APPLY:
  (1) "ELIGIBLE EXPENDITURES" SHALL MEAN FEES FOR ARCHITECTURAL, ARCHEO-
LOGICAL,  GEOLOGICAL  AND  ENGINEERING SERVICES; THE COSTS OF DEVELOPING
PLANS AND SPECIFICATIONS; FEES FOR CONSULTANT AND  LEGAL  SERVICES;  AND
ANY  EXPENDITURE  DEFINED  IN  INTERNAL  REVENUE CODE SECTION 175(C)(1),

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD02530-03-3
              

A. 6981                             2

INCLUDING EXPENDITURES RELATED TO THE APPLICATION OF LIME AND  FERTILIZ-
ER,  IMPROVEMENT  OF  DRAINAGE  IN THE CASE OF OPEN AREAS THAT HAVE BEEN
USED FOR AGRICULTURAL PURPOSES AT ANY TIME IN THE PAST, AND EXPENDITURES
RELATED  TO  THE  DECONSTRUCTION AND REMOVAL OF FENCES, STREAM CROSSINGS
AND NECESSARY RIPARIAN BUFFERS AND FORESTLAND IMPROVEMENTS  AS  REQUIRED
BY THE NATURAL RESOURCES IMPROVEMENT PROJECT.
  (2)  "FARMLAND AND FORESTLAND" SHALL MEAN LAND WHICH, DURING THE TAXA-
BLE YEAR IN WHICH THE CREDIT IS CLAIMED PURSUANT TO THIS SUBDIVISION, IS
ELIGIBLE  FOR   AN   AGRICULTURAL   ASSESSMENT   PURSUANT   TO   ARTICLE
TWENTY-FIVE-AA  OF  THE  AGRICULTURE  AND  MARKETS LAW OR ELIGIBLE FOR A
FOREST ASSESSMENT UNDER SECTION FOUR HUNDRED EIGHTY-A OF THE REAL  PROP-
ERTY TAX LAW.
  (3) "NATURAL RESOURCES IMPROVEMENT PROJECT" SHALL MEAN THE RESTORATION
OF  FARMLAND AND FORESTLAND FOR THE PRODUCTION OF AGRICULTURAL PERENNIAL
CROPS, INCLUDING THOSE CROPS INTENDED FOR ENERGY PRODUCTION PURPOSES, BY
IMPROVING SUCH LAND WHICH HAS NOT BEEN USED IN  AGRICULTURAL  PRODUCTION
FOR  TWO  OR  MORE  YEARS PRIOR TO THE INITIATION OF SUCH RESTORATION OR
FORESTLAND IMPROVEMENTS REQUIRED IN THE MANAGEMENT PLAN.
  (C) APPLICATION OF CREDIT. THE CREDIT ALLOWED UNDER  THIS  SUBDIVISION
FOR  ANY  TAXABLE  YEAR MAY NOT REDUCE THE TAX DUE FOR SUCH YEAR TO LESS
THAN THE AMOUNT PRESCRIBED IN PARAGRAPH (D) OF SUBDIVISION ONE  OF  THIS
SECTION. HOWEVER, IF THE AMOUNT OF CREDIT ALLOWED UNDER THIS SUBDIVISION
FOR ANY TAXABLE YEAR REDUCES THE TAX TO SUCH AMOUNT, ANY AMOUNT OF CRED-
IT  THUS NOT DEDUCTIBLE IN SUCH TAXABLE YEAR WILL BE TREATED AS AN OVER-
PAYMENT OF TAX TO  BE  CREDITED  OR  REFUNDED  IN  ACCORDANCE  WITH  THE
PROVISIONS OF SECTION ONE THOUSAND EIGHTY-SIX OF THIS CHAPTER. PROVIDED,
HOWEVER, THE PROVISIONS OF SUBSECTION (C) OF SECTION ONE THOUSAND EIGHT-
Y-EIGHT OF THIS CHAPTER NOTWITHSTANDING, NO INTEREST WILL BE PAID THERE-
ON.
  S  3. Subparagraph (B) of paragraph 1 of subsection (i) of section 606
of the tax law is amended by adding a  new  clause  (xxxv)  to  read  as
follows:
(XXXV) NATURAL RESOURCE              AMOUNT OF CREDIT FOR ELIGIBLE
IMPROVEMENT CREDIT FOR               EXPENDITURES FOR A NATURAL
FARMLANDS AND                        RESOURCES IMPROVEMENT PROJECT
FORESTLANDS UNDER                    UNDER SUBDIVISION FORTY-SIX
SUBSECTION (VV)                      OF SECTION TWO HUNDRED TEN
  S  4. Section 606 of the tax law is amended by adding a new subsection
(vv) to read as follows:
  (VV) NATURAL RESOURCE IMPROVEMENT CREDIT  FOR  FARMLANDS  AND  FOREST-
LANDS.  (1) ALLOWANCE OF CREDIT. FOR TAXABLE YEARS BEGINNING ON OR AFTER
JANUARY  FIRST,  TWO  THOUSAND  THIRTEEN,  A TAXPAYER SHALL BE ALLOWED A
CREDIT AGAINST THE TAX IMPOSED BY THIS ARTICLE IN  AN  AMOUNT  EQUAL  TO
TWENTY-FIVE  PERCENT  OF THE TAXPAYER'S ELIGIBLE EXPENDITURES DURING THE
TAX YEAR FOR A NATURAL RESOURCE IMPROVEMENT PROJECT. PROVIDED,  HOWEVER,
THAT  THE  CREDIT  GRANTED  FOR ANY NATURAL RESOURCE IMPROVEMENT PROJECT
PURSUANT TO THIS SUBSECTION SHALL NOT EXCEED FIFTY THOUSAND DOLLARS.
  (2) DEFINITIONS. FOR THE PURPOSES OF THIS  SUBSECTION,  THE  FOLLOWING
DEFINITIONS SHALL APPLY:
  (A) "ELIGIBLE EXPENDITURES" SHALL MEAN FEES FOR ARCHITECTURAL, ARCHEO-
LOGICAL,  GEOLOGICAL  AND  ENGINEERING SERVICES; THE COSTS OF DEVELOPING
PLANS AND SPECIFICATIONS; FEES FOR CONSULTANT AND  LEGAL  SERVICES;  AND
ANY  EXPENDITURE  DEFINED  IN  INTERNAL  REVENUE CODE SECTION 175(C)(1),
INCLUDING EXPENDITURES RELATED TO THE APPLICATION OF LIME AND  FERTILIZ-
ER,  IMPROVEMENT  OF  DRAINAGE  IN THE CASE OF OPEN AREAS THAT HAVE BEEN
USED FOR AGRICULTURAL PURPOSES AT ANY TIME IN THE PAST, AND EXPENDITURES

A. 6981                             3

RELATED TO THE DECONSTRUCTION AND REMOVAL OF  FENCES,  STREAM  CROSSINGS
AND  NECESSARY  RIPARIAN BUFFERS AND FORESTLAND IMPROVEMENTS AS REQUIRED
BY THE NATURAL RESOURCE IMPROVEMENT PROJECT.
  (B)  "FARMLAND AND FORESTLAND" SHALL MEAN LAND WHICH, DURING THE TAXA-
BLE YEAR IN WHICH THE CREDIT IS CLAIMED PURSUANT TO THIS SUBSECTION,  IS
ELIGIBLE   FOR   AN   AGRICULTURAL   ASSESSMENT   PURSUANT   TO  ARTICLE
TWENTY-FIVE-AA OF THE AGRICULTURE AND MARKETS  LAW  OR  ELIGIBLE  FOR  A
FOREST  ASSESSMENT UNDER SECTION FOUR HUNDRED EIGHTY-A OF THE REAL PROP-
ERTY TAX LAW.
  (C) "NATURAL RESOURCE IMPROVEMENT PROJECT" SHALL MEAN THE  RESTORATION
OF  FARMLAND AND FORESTLAND FOR THE PRODUCTION OF AGRICULTURAL PERENNIAL
CROPS, INCLUDING THOSE CROPS INTENDED FOR ENERGY PRODUCTION PURPOSES, BY
IMPROVING SUCH LAND WHICH HAS NOT BEEN USED IN  AGRICULTURAL  PRODUCTION
FOR TWO OR MORE YEARS PRIOR TO THE COMPLETION OF SUCH RESTORATION OR HAD
A COMMERCIAL TIMBER HARVEST WITHIN THE PAST FIVE YEARS.
  (3)  APPLICATION  OF CREDIT. IF THE AMOUNT OF THE CREDIT ALLOWED UNDER
THIS SUBSECTION SHALL EXCEED THE  TAXPAYER'S  TAX  FOR  SUCH  YEAR,  THE
TAXPAYER  MAY  RECEIVE  AND THE COMPTROLLER, SUBJECT TO A CERTIFICATE OF
THE COMMISSIONER, SHALL PAY AS AN  OVERPAYMENT,  WITHOUT  INTEREST,  THE
AMOUNT OF SUCH EXCESS.
  S  5.  Paragraph 4 of subsection (b) of section 612 of the tax law, as
amended by chapter 406 of the laws  of  1990,  is  amended  to  read  as
follows:
  (4)  Interest  on  indebtedness  incurred  or continued to purchase or
carry obligations or securities the interest on which is exempt from tax
under this article, to the  extent  deductible  in  determining  federal
adjusted  gross  income;  PROVIDED THAT IN THE EVENT THE TAXPAYER CLAIMS
THE NATURAL RESOURCE IMPROVEMENT CREDIT FOR  FARMLANDS  AND  FORESTLANDS
ESTABLISHED  PURSUANT  TO  SUBSECTION (VV) OF SECTION SIX HUNDRED SIX OF
THIS ARTICLE, THE AMOUNT OF ANY EXPENDITURES DEFINED IN INTERNAL REVENUE
CODE SECTION 175(C)(1) THAT THE TAXPAYER DEDUCTED FROM HIS OR HER FEDER-
AL GROSS INCOME ON HIS OR HER FEDERAL TAX RETURN FOR THE TAX YEAR.
  S 6. This act shall take effect immediately and shall apply to  resto-
ration projects initiated on or after such date.