[ ] is old law to be omitted.
LBD12574-03-3
S. 2609--B 2 A. 3009--B
filing of tax documents and improving sales tax compliance and to
repeal certain provisions of the tax law and the administrative code
of the city of New York relating thereto (Part H); to amend the tax
law, in relation to exempting sales made at a Taste-NY facility from
sales and compensating use taxes; and to amend the alcoholic beverage
control law, in relation to allowing sales of all types of alcoholic
beverages at a Taste-NY facility (Part I); to amend the general munic-
ipal law and the public authorities law, in relation to industrial
development agencies and authorities (Part J); to amend the tax law,
in relation to expanding the exemption of CNG in the sales tax to
include natural gas purchased and used to produce CNG for use exclu-
sively and directly in the engine of a motor vehicle (Part K); to
amend the tax law, in relation to allowing voluntary ambulance
services, fire companies, fire departments and rescue squads to claim
reimbursement of the petroleum business tax for fuel used in their
vehicles (Part L); to amend the tax law, in relation to the power of
the commissioner of taxation and finance to refuse to issue a certif-
icate of authority to collect the sales and use taxes and the power of
the commissioner of taxation and finance to revoke such a certificate
once granted and penalties related to the operation of a business
without such certificate (Part M); to amend the tax law, in relation
to allowing the department of taxation and finance to refuse a certif-
icate of registration to retail dealers of cigarettes and tobacco
products if such dealers have certain tax liabilities or have been
convicted of a tax crime within one year of applying for or renewing a
certificate of registration (Part N); to amend the tax law, in
relation to increasing the penalty for the possession of unstamped and
unlawfully stamped cigarettes (Part O); to amend the tax law, the
vehicle and traffic law and the insurance law, in relation to the
suspension of drivers' licenses of persons who are delinquent in the
payment of past-due tax liabilities (Part P); to amend the tax law, in
relation to serving an income execution with respect to individual tax
debtors without filing a warrant (Part Q); to amend the tax law, in
relation to the authority of counties to impose sales and compensating
use taxes pursuant to the authority of article 29 of such law; and to
repeal certain provisions of sections 1210 and 1224 and section 1210-E
of such law relating thereto (Part R); to amend the tax law, in
relation to a keno style lottery game (Part S); to amend the tax law,
in relation to vendor fees paid to vendor tracks (Part T); to amend
the racing, pari-mutuel wagering and breeding law, in relation to
licenses for simulcast facilities, sums relating to track simulcast,
simulcast of out-of-state thoroughbred races, simulcasting of races
run by out-of-state harness tracks and distributions of wagers; to
amend chapter 281 of the laws of 1994, amending the racing, pari-mutu-
el wagering and breeding law and other laws relating to simulcasting
and chapter 346 of the laws of 1990, amending the racing, pari-mutuel
wagering and breeding law and other laws relating to simulcasting and
the imposition of certain taxes, in relation to making permanent
certain provisions thereof; to amend the racing, pari-mutuel wagering
and breeding law, in relation to making permanent certain provisions
thereof; and to repeal subdivision 5 of section 1012 of the racing,
pari-mutuel wagering and breeding law relating to telephone accounts
and telephone wagering and section 1014 of the racing, pari-mutuel
wagering and breeding law relating to simulcasting of out-of-state
thoroughbred races (Part U); to amend the tax law, in relation to the
credit for the rehabilitation of historic homes (Part V); to amend the
S. 2609--B 3 A. 3009--B
tax law, in relation to allowing certain tax-free interdistributor
sales of highway diesel motor fuel (Part W); and to amend the tax law,
in relation to updating the farming exemption in the highway use tax
to reflect current industry practice (Part X)
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. This act enacts into law major components of legislation
which are necessary to implement the state fiscal plan for the 2013-2014
state fiscal year. Each component is wholly contained within a Part
identified as Parts A through X. The effective date for each particular
provision contained within such Part is set forth in the last section of
such Part. Any provision in any section contained within a Part, includ-
ing the effective date of the Part, which makes a reference to a section
"of this act", when used in connection with that particular component,
shall be deemed to mean and refer to the corresponding section of the
Part in which it is found. Section three of this act sets forth the
general effective date of this act.
PART A
Section 1. Subdivision 1 of section 183-a of the tax law, as amended
by section 1 of part II-1 of chapter 57 of the laws of 2008, is amended
to read as follows:
1. The term "corporation" as used in this section shall include an
association, within the meaning of paragraph three of subsection (a) of
section seventy-seven hundred one of the internal revenue code (includ-
ing a limited liability company), a publicly traded partnership treated
as a corporation for purposes of the internal revenue code pursuant to
section seventy-seven hundred four thereof and any business conducted by
a trustee or trustees wherein interest or ownership is evidenced by
certificates or other written instruments. Every corporation, joint-
stock company or association formed for or principally engaged in the
conduct of canal, steamboat, ferry (except a ferry company operating
between any of the boroughs of the city of New York under a lease grant-
ed by the city), express, navigation, pipe line, transfer, baggage
express, omnibus, taxicab, telegraph, or telephone business, or formed
for or principally engaged in the conduct of two or more such busi-
nesses, and every corporation, joint-stock company or association formed
for or principally engaged in the conduct of a railroad, palace car,
sleeping car or trucking business or formed for or principally engaged
in the conduct of two or more of such businesses and which has made an
election pursuant to subdivision ten of section one hundred eighty-three
of this article, and every other corporation, joint-stock company or
association principally engaged in the conduct of a transportation or
transmission business, except a corporation, joint-stock company or
association formed for or principally engaged in the conduct of a rail-
road, palace car, sleeping car or trucking business or formed for or
principally engaged in the conduct of two or more of such businesses and
which has not made the election provided for in subdivision ten of
section one hundred eighty-three of this article, and except a corpo-
ration, joint-stock company or association principally engaged in the
conduct of aviation (including air freight forwarders acting as princi-
pal and like indirect air carriers) and except a corporation principally
S. 2609--B 4 A. 3009--B
engaged in providing telecommunication services between aircraft and
dispatcher, aircraft and air traffic control or ground station and
ground station (or any combination of the foregoing), at least ninety
percent of the voting stock of which corporation is owned, directly or
indirectly, by air carriers and which corporation's principal function
is to fulfill the requirements of (i) the federal aviation adminis-
tration (or the successor thereto) or (ii) the international civil
aviation organization (or the successor thereto), relating to the exist-
ence of a communication system between aircraft and dispatcher, aircraft
and air traffic control or ground station and ground station (or any
combination of the foregoing) for the purposes of air safety and naviga-
tion and except a corporation, joint-stock company or association which
is liable to taxation under article thirty-two of this chapter, shall
pay for the privilege of exercising its corporate franchise, or of doing
business, or of employing capital, or of owning or leasing property in
the metropolitan commuter transportation district in such corporate or
organized capacity, or of maintaining an office in such district, a tax
surcharge for all or any part of its years commencing on or after Janu-
ary first, nineteen hundred eighty-two but ending before December thir-
ty-first, two thousand [thirteen] EIGHTEEN, which tax surcharge, in
addition to the tax imposed by section one hundred eighty-three of this
article, shall be computed at the rate of eighteen percent of the tax
imposed under such section one hundred eighty-three for such years or
any part of such years ending before December thirty-first, nineteen
hundred eighty-three after the deduction of any credits otherwise allow-
able under this article, and at the rate of seventeen percent of the tax
imposed under such section for such years or any part of such years
ending on or after December thirty-first, nineteen hundred eighty-three
after the deduction of any credits otherwise allowable under this arti-
cle; provided, however, that such rates of tax surcharge shall be
applied only to that portion of the tax imposed under section one
hundred eighty-three of this article after the deduction of any credits
otherwise allowable under this article which is attributable to the
taxpayer's business activity carried on within the metropolitan commuter
transportation district as so determined in the manner prescribed by the
rules and regulations promulgated by the commissioner; and provided,
further, that the tax surcharge imposed by this section shall not be
imposed upon any taxpayer for more than [three] FOUR hundred [seventy-
two] THIRTY-TWO months.
S 2. The opening paragraph of subdivision 1 of section 184-a of the
tax law, as amended by section 2 of part II-1 of chapter 57 of the laws
of 2008, is amended to read as follows:
The term "corporation" as used in this section shall include an asso-
ciation, within the meaning of paragraph three of subsection (a) of
section seventy-seven hundred one of the internal revenue code (includ-
ing a limited liability company), and a publicly traded partnership
treated as a corporation for purposes of the internal revenue code
pursuant to section seventy-seven hundred four thereof. Every corpo-
ration, joint-stock company or association formed for or principally
engaged in the conduct of canal, steamboat, ferry (except a ferry compa-
ny operating between any of the boroughs of the city of New York under a
lease granted by the city), express, navigation, pipe line, transfer,
baggage express, omnibus, taxicab, telegraph or local telephone busi-
ness, or formed for or principally engaged in the conduct of two or more
such businesses, and every corporation, joint-stock company or associ-
ation formed for or principally engaged in the conduct of a surface
S. 2609--B 5 A. 3009--B
railroad, whether or not operated by steam, subway railroad, elevated
railroad, palace car, sleeping car or trucking business or principally
engaged in the conduct of two or more such businesses and which has made
an election pursuant to subdivision ten of section one hundred eighty-
three of this article, and every other corporation, joint-stock company
or association formed for or principally engaged in the conduct of a
transportation or transmission business (other than a telephone busi-
ness) except a corporation, joint-stock company or association formed
for or principally engaged in the conduct of a surface railroad, whether
or not operated by steam, subway railroad, elevated railroad, palace
car, sleeping car or trucking business or principally engaged in the
conduct of two or more such businesses and which has not made the
election provided for in subdivision ten of section one hundred eighty-
three of this article, and except a corporation, joint-stock company or
association principally engaged in the conduct of aviation (including
air freight forwarders acting as principal and like indirect air carri-
ers) and except a corporation principally engaged in providing telecom-
munication services between aircraft and dispatcher, aircraft and air
traffic control or ground station and ground station (or any combination
of the foregoing), at least ninety percent of the voting stock of which
corporation is owned, directly or indirectly, by air carriers and which
corporation's principal function is to fulfill the requirements of (i)
the federal aviation administration (or the successor thereto) or (ii)
the international civil aviation organization (or the successor there-
to), relating to the existence of a communication system between
aircraft and dispatcher, aircraft and air traffic control or ground
station and ground station (or any combination of the foregoing) for the
purposes of air safety and navigation and except a corporation, joint-
stock company or association which is liable to taxation under article
thirty-two of this chapter, shall pay for the privilege of exercising
its corporate franchise, or of doing business, or of employing capital,
or of owning or leasing property in the metropolitan commuter transpor-
tation district in such corporate or organized capacity, or of maintain-
ing an office in such district, a tax surcharge for all or any part of
its taxable years commencing on or after January first, nineteen hundred
eighty-two, but ending before December thirty-first, two thousand [thir-
teen] EIGHTEEN, which tax surcharge, in addition to the tax imposed by
section one hundred eighty-four of this article, shall be computed at
the rate of eighteen percent of the tax imposed under such section one
hundred eighty-four for such taxable years or any part of such taxable
years ending before December thirty-first, nineteen hundred eighty-three
after the deduction of any credits otherwise allowable under this arti-
cle, and at the rate of seventeen percent of the tax imposed under such
section for such taxable years or any part of such taxable years ending
on or after December thirty-first, nineteen hundred eighty-three after
the deduction of any credits otherwise allowable under this article;
provided, however, that such rates of tax surcharge shall be applied
only to that portion of the tax imposed under section one hundred eight-
y-four of this article after the deduction of any credits otherwise
allowable under this article which is attributable to the taxpayer's
business activity carried on within the metropolitan commuter transpor-
tation district; and provided, further, that the tax surcharge imposed
by this section on corporations, joint-stock companies and associations
formed for or principally engaged in the conduct of telephone or tele-
graph business shall be computed in accordance with this subdivision and
paragraph (c) of subdivision two of this section as if the three-quar-
S. 2609--B 6 A. 3009--B
ters of one percent rate of tax provided for in subdivision one of
section one hundred eighty-four of this article were applicable to such
telephone and telegraph businesses for taxable years commencing on or
after January first, nineteen hundred eighty-five and ending on or
before December thirty-first, nineteen hundred eighty-nine; and
provided, further, that the tax surcharge imposed by this section shall
not be imposed upon any taxpayer for more than [three] FOUR hundred
[seventy-two] THIRTY-TWO months. Provided, however, that for taxable
years beginning in two thousand and thereafter, for purposes of this
subdivision the tax imposed under section one hundred eighty-four of
this article shall be deemed to have been imposed at the rate of three-
quarters of one percent, except that in the case of a corporation,
joint-stock company or association which has made an election pursuant
to subdivision ten of section one hundred eighty-three of this article,
for purposes of this subdivision the tax imposed under section one
hundred eighty-four of this article shall be deemed to have been imposed
at the rate of six-tenths of one percent.
S 3. Subparagraph 1 of paragraph (a) of subdivision 1 of section 186-c
of the tax law, as amended by section 3 of part II-1 of chapter 57 of
the laws of 2008, is amended to read as follows:
(1) Every utility doing business in the metropolitan commuter trans-
portation district shall pay a tax surcharge, in addition to the tax
imposed by section one hundred eighty-six-a of this article, for all or
any parts of its taxable years commencing on or after January first,
nineteen hundred eighty-two but ending before December thirty-first, two
thousand [thirteen] EIGHTEEN, to be computed at the rate of eighteen
percent of the tax imposed under section one hundred eighty-six-a of
this article for such taxable years or any part of such taxable years
ending before December thirty-first, nineteen hundred eighty-three after
the deduction of any credits otherwise allowable under this article, and
at the rate of seventeen percent of the tax imposed under such section
for such taxable years or any part of such taxable years ending on or
after December thirty-first, nineteen hundred eighty-three after the
deduction of credits otherwise allowable under this article except any
utility credit provided for by article thirteen-A of this chapter;
provided, however, that such rates of tax surcharge shall be applied
only to that portion of the tax imposed under section one hundred eight-
y-six-a of this article after the deduction of credits otherwise allow-
able under this article, except any utility credit provided for by arti-
cle thirteen-A of this chapter, which is attributable to the taxpayer's
gross income or gross operating income from business activity carried on
within the metropolitan commuter transportation district; and provided,
further, that the tax surcharge imposed by this section shall not be
imposed upon any taxpayer for more than [three] FOUR hundred [seventy-
two] THIRTY-TWO months.
S 4. Subdivision 1 of section 209-B of the tax law, as amended by
section 4 of part II-1 of chapter 57 of the laws of 2008, is amended to
read as follows:
1. For the privilege of exercising its corporate franchise, or of
doing business, or of employing capital, or of owning or leasing proper-
ty in a corporate or organized capacity, or of maintaining an office in
the metropolitan commuter transportation district, for all or any part
of its taxable year, there is hereby imposed on every corporation, other
than a New York S corporation, subject to tax under section two hundred
nine of this article, or any receiver, referee, trustee, assignee or
other fiduciary, or any officer or agent appointed by any court, who
S. 2609--B 7 A. 3009--B
conducts the business of any such corporation, for the taxable years
commencing on or after January first, nineteen hundred eighty-two but
ending before December thirty-first, two thousand [thirteen] EIGHTEEN, a
tax surcharge, in addition to the tax imposed under section two hundred
nine of this article, to be computed at the rate of eighteen percent of
the tax imposed under such section two hundred nine for such taxable
years or any part of such taxable years ending before December thirty-
first, nineteen hundred eighty-three after the deduction of any credits
otherwise allowable under this article, and at the rate of seventeen
percent of the tax imposed under such section for such taxable years or
any part of such taxable years ending on or after December thirty-first,
nineteen hundred eighty-three after the deduction of any credits other-
wise allowable under this article; provided, however, that such rates of
tax surcharge shall be applied only to that portion of the tax imposed
under section two hundred nine of this article after the deduction of
any credits otherwise allowable under this article which is attributable
to the taxpayer's business activity carried on within the metropolitan
commuter transportation district; and provided, further, that the tax
surcharge imposed by this section shall not be imposed upon any taxpayer
for more than [three] FOUR hundred [seventy-two] THIRTY-TWO months.
Provided however, that for taxable years commencing on or after July
first, nineteen hundred ninety-eight, such surcharge shall be calculated
as if the tax imposed under section two hundred ten of this article were
imposed under the law in effect for taxable years commencing on or after
July first, nineteen hundred ninety-seven and before July first, nine-
teen hundred ninety-eight. Provided however, that for taxable years
commencing on or after January first, two thousand seven, such surcharge
shall be calculated using the highest of the tax bases imposed pursuant
to paragraphs (a), (b), (c) or (d) of subdivision one of section two
hundred ten of this article and the amount imposed under paragraph (e)
of subdivision one of such section two hundred ten, for the taxable
year; and, provided further that, if such highest amount is the tax base
imposed under paragraph (a), (b) or (c) of such subdivision, then the
surcharge shall be computed as if the tax rates and limitations under
such paragraph were the tax rates and limitations under such paragraph
in effect for taxable years commencing on or after July first, nineteen
hundred ninety-seven and before July first, nineteen hundred ninety-
eight.
S 5. Subsection 1 of section 1455-B of the tax law, as amended by
section 5 of part II-1 of chapter 57 of the laws of 2008, is amended to
read as follows:
1. For the privilege of exercising its franchise or doing business in
the metropolitan commuter transportation district in a corporate or
organized capacity, there is hereby imposed on every taxpayer subject to
tax under this article, other than a New York S corporation, for the
taxable years commencing on or after January first, nineteen hundred
eighty-two but ending before December thirty-first, two thousand [thir-
teen] EIGHTEEN, a tax surcharge, in addition to the tax imposed under
section fourteen hundred fifty-one of this article, at the rate of eigh-
teen percent of the tax imposed under such section fourteen hundred
fifty-one of this article, for such taxable years or any part of such
taxable years ending before December thirty-first, nineteen hundred
eighty-three after the deduction of any credits otherwise allowable
under this article, and at the rate of seventeen percent of the tax
imposed under such section for such taxable years or any part of such
taxable years ending on or after December thirty-first, nineteen hundred
S. 2609--B 8 A. 3009--B
eighty-three after the deduction of any credits otherwise allowable
under this article; provided however, that such rates of tax surcharge
shall be applied only to that portion of the tax imposed under section
fourteen hundred fifty-one of this article after the deduction of any
credits otherwise allowable under this article which is attributable to
the taxpayer's business activity carried on within the metropolitan
commuter transportation district; and provided, further, that the tax
surcharge imposed by this section shall not be imposed upon any taxpayer
for more than [three] FOUR hundred [seventy-two] THIRTY-TWO months.
Provided however, that for taxable years commencing on or after July
first, two thousand, such surcharge shall be calculated as if the rate
of the basic tax computed under subsection (a) of section fourteen
hundred fifty-five of this article was nine percent.
S 6. Paragraphs 1 and 3 of subdivision (a) of section 1505-a of the
tax law, as amended by section 6 of part II-1 of chapter 57 of the laws
of 2008, are amended to read as follows:
(1) Every domestic insurance corporation and every foreign or alien
insurance corporation, and every life insurance corporation described in
subdivision (b) of section fifteen hundred one of this article, for the
privilege of exercising its corporate franchise, or of doing business,
or of employing capital, or of owning or leasing property in the metro-
politan commuter transportation district in a corporate or organized
capacity, or of maintaining an office in the metropolitan commuter
transportation district, for all or any part of its taxable years
commencing on or after January first, nineteen hundred eighty-two, but
ending before December thirty-first, two thousand [thirteen] EIGHTEEN,
except corporations specified in subdivision (c) of section fifteen
hundred twelve of this article, shall annually pay, in addition to the
taxes otherwise imposed by this article, a tax surcharge on the taxes
imposed under this article after the deduction of any credits otherwise
allowable under this article as allocated to such district. Such taxes
shall be allocated to such district for purposes of computing such tax
surcharge upon taxpayers subject to tax under subdivision (b) of section
fifteen hundred ten of this article by applying the methodology, proce-
dures and computations set forth in subdivisions (a) and (b) of section
fifteen hundred four of this article, except that references to terms
denoting New York premiums, and total wages, salaries, personal service
compensation and commissions within New York shall be read as denoting
within the metropolitan commuter transportation district and terms
denoting total premiums and total wages, salaries, personal service
compensation and commissions shall be read as denoting within the state.
If it shall appear to the commissioner that the application of the meth-
odology, procedures and computations set forth in such subdivisions (a)
and (b) does not properly reflect the activity, business or income of a
taxpayer within the metropolitan commuter transportation district, then
the commissioner shall be authorized, in the commissioner's discretion,
to adjust such methodology, procedures and computations for the purpose
of allocating such taxes by:
(A) excluding one or more factors therein;
(B) including one or more other factors therein, such as expenses,
purchases, receipts other than premiums, real property or tangible
personal property; or
(C) any other similar or different method which allocates such taxes
by attributing a fair and proper portion of such taxes to the metropol-
itan commuter transportation district. The commissioner from time to
time shall publish all rulings of general public interest with respect
S. 2609--B 9 A. 3009--B
to any application of the provisions of the preceding sentence. The
commissioner may promulgate rules and regulations to further implement
the provisions of this section.
(3) Such tax surcharge shall be computed at the rate of eighteen
percent of the taxes imposed under sections fifteen hundred one and
fifteen hundred ten of this article as limited by section fifteen
hundred five of this article, as allocated to such district, for such
taxable years or any part of such taxable years ending before December
thirty-first, nineteen hundred eighty-three after the deduction of any
credits otherwise allowable under this article, at the rate of seventeen
percent of the taxes imposed under such sections as limited by section
fifteen hundred five of this article, as allocated to such district, for
such taxable years or any part of such taxable years ending on or after
December thirty-first, nineteen hundred eighty-three and before January
first, two thousand three after the deduction of any credits otherwise
allowable under this article, and at the rate of seventeen percent of
the taxes imposed under sections fifteen hundred one, fifteen hundred
two-a, and fifteen hundred ten of this article, as limited or otherwise
determined by subdivision (a) or (b) of section fifteen hundred five of
this article, as allocated to such district, for such taxable years or
any part of such taxable years ending after December thirty-first, two
thousand two after the deduction of any credits otherwise allowable
under this article; provided, however, that the tax surcharge imposed by
this section shall not be imposed upon any taxpayer for more than
[three] FOUR hundred [seventy-two] THIRTY-TWO months. Provided however,
that for taxable years commencing on or after July first, two thousand,
and in the case of taxpayers subject to tax under section fifteen
hundred two-a of this article, for taxable years of such taxpayers
beginning on or after July first, two thousand and before January first,
two thousand three, such surcharge shall be calculated as if (i) the
rate of the tax computed under paragraph one of subdivision (a) of
section fifteen hundred two of this article was nine percent and (ii)
the rate of the limitation on tax set forth in section fifteen hundred
five of this article for domestic, foreign and alien insurance corpo-
rations except life insurance corporations was two and six-tenths
percent.
S 7. This act shall take effect immediately.
PART B
Section 1. Paragraph 3 of subdivision (b) of section 24 of the tax
law, as added by section 1 of part P of chapter 60 of the laws of 2004,
is amended to read as follows:
(3) "Qualified film" means a feature-length film, television film,
RELOCATED TELEVISION PRODUCTION, television pilot and/or each episode of
a television series, regardless of the medium by means of which the
film, pilot or episode is created or conveyed. "Qualified film" shall
not include (i) a documentary film, news or current affairs program,
interview or talk program, "how-to" (i.e., instructional) film or
program, film or program consisting primarily of stock footage, sporting
event or sporting program, game show, award ceremony, film or program
intended primarily for industrial, corporate or institutional end-users,
fundraising film or program, daytime drama (i.e., daytime "soap opera"),
commercials, music videos or "reality" program, or (ii) a production for
which records are required under section 2257 of title 18, United States
code, to be maintained with respect to any performer in such production
S. 2609--B 10 A. 3009--B
(reporting of books, films, etc. with respect to sexually explicit
conduct).
S 2. Subdivision (b) of section 24 of the tax law is amended by adding
a new paragraph 8 to read as follows:
(8) "RELOCATED TELEVISION PRODUCTION" SHALL MEAN, NOTWITHSTANDING THE
LIMITATIONS IN SUBPARAGRAPH (I) OF PARAGRAPH THREE OF THIS SUBDIVISION,
A TELEVISION PRODUCTION THAT IS A TALK OR VARIETY PROGRAM THAT FILMED AT
LEAST FIVE SEASONS OUTSIDE THE STATE PRIOR TO ITS FIRST RELOCATED SEASON
IN NEW YORK, THE EPISODES ARE FILMED BEFORE A STUDIO AUDIENCE OF TWO
HUNDRED OR MORE, AND THE RELOCATED TELEVISION PRODUCTION INCURS (I) AT
LEAST THIRTY MILLION DOLLARS IN ANNUAL PRODUCTION COSTS IN THE STATE, OR
(II) AT LEAST TEN MILLION DOLLARS IN CAPITAL EXPENDITURES AT A QUALIFIED
PRODUCTION FACILITY IN THE STATE.
S 3. Paragraph 4 of subdivision (e) of section 24 of the tax law, as
added by chapter 268 of the laws of 2012, is amended to read as follows:
(4) Additional pool 2 - The aggregate amount of tax credits allowed in
subdivision (a) of this section shall be increased by an [addition]
ADDITIONAL four hundred twenty million dollars in EACH YEAR STARTING IN
two thousand ten[, four hundred twenty million dollars in two thousand
eleven, four hundred twenty million dollars in two thousand twelve, four
hundred twenty million dollars in two thousand thirteen and four hundred
twenty million dollars in two thousand fourteen] THROUGH TWO THOUSAND
NINETEEN provided however, seven million dollars of the annual allo-
cation shall be available for the empire state film post production
credit pursuant to section thirty-one of this [chapter] ARTICLE IN TWO
THOUSAND THIRTEEN AND TWO THOUSAND FOURTEEN AND TWENTY-FIVE MILLION
DOLLARS OF THE ANNUAL ALLOCATION SHALL BE AVAILABLE FOR THE EMPIRE STATE
FILM POST PRODUCTION CREDIT PURSUANT TO SECTION THIRTY-ONE OF THIS ARTI-
CLE IN EACH YEAR STARTING IN TWO THOUSAND FIFTEEN THROUGH TWO THOUSAND
NINETEEN. This amount shall be allocated by the governor's office for
motion picture and television development among taxpayers in accordance
with subdivision (a) of this section. If the [director of the governor's
office for motion picture and television development] COMMISSIONER OF
ECONOMIC DEVELOPMENT determines that the aggregate amount of tax credits
available from additional pool 2 for the empire state film production
tax credit have been previously allocated, and determines that the pend-
ing applications from eligible applicants for the EMPIRE STATE FILM post
production tax credit pursuant to section thirty-one of this [chapter]
ARTICLE is insufficient to utilize the balance of unallocated EMPIRE
STATE FILM post production tax credits from such pool, the remainder,
after such pending applications are considered, shall be made available
for allocation in the empire state film tax credit pursuant to this
section, subdivision thirty-six of section two hundred ten and
subsection (gg) of section six hundred six of this chapter. ALSO, IF
THE COMMISSIONER OF ECONOMIC DEVELOPMENT DETERMINES THAT THE AGGREGATE
AMOUNT OF TAX CREDITS AVAILABLE FROM ADDITIONAL POOL 2 FOR THE EMPIRE
STATE FILM POST PRODUCTION TAX CREDIT HAVE BEEN PREVIOUSLY ALLOCATED,
AND DETERMINES THAT THE PENDING APPLICATIONS FROM ELIGIBLE APPLICANTS
FOR THE EMPIRE STATE FILM PRODUCTION TAX CREDIT PURSUANT TO THIS SECTION
IS INSUFFICIENT TO UTILIZE THE BALANCE OF UNALLOCATED FILM PRODUCTION
TAX CREDITS FROM SUCH POOL, THEN ALL OR PART OF THE REMAINDER, AFTER
SUCH PENDING APPLICATIONS ARE CONSIDERED, SHALL BE MADE AVAILABLE FOR
ALLOCATION FOR THE EMPIRE STATE FILM POST PRODUCTION CREDIT PURSUANT TO
THIS SECTION, SUBDIVISION FORTY-ONE OF SECTION TWO HUNDRED TEN AND
SUBSECTION (GG) OF SECTION SIX HUNDRED SIX OF THIS CHAPTER. The gover-
nor's office for motion picture and television development must notify
S. 2609--B 11 A. 3009--B
taxpayers of their allocation year and include the allocation year on
the certificate of tax credit. Taxpayers eligible to claim a credit
must report the allocation year directly on their empire state film
production credit tax form for each year a credit is claimed and include
a copy of the certificate with their tax return. In the case of a quali-
fied film that receives funds from additional pool 2, no empire state
film production credit shall be claimed before the later of the taxable
year the production of the qualified film is complete, or the taxable
year immediately following the allocation year for which the film has
been allocated credit by the governor's office for motion picture and
television development.
S 4. Paragraph 1 of subdivision (b) of section 24 of the tax law, as
amended by section 6 of part Q of chapter 57 of the laws of 2010, is
amended to read as follows:
(1) "Qualified production costs" means production costs only to the
extent such costs are attributable to the use of tangible property or
the performance of services within the state directly and predominantly
in the production (including pre-production and post production) of a
qualified film[, provided, however, that qualified production costs
shall not include post production costs unless the portion of the post
production costs paid or incurred that is attributable to the use of
tangible property or the performance of services in New York in the
production of such qualified film equals or exceeds seventy-five percent
of the total post production costs spent within and without New York in
the production of such qualified film].
S 5. Paragraph 3 of subdivision (a) of section 31 of the tax law, as
added by section 12 of part Q of chapter 57 of the laws of 2010, is
amended to read as follows:
(3) (I) A taxpayer shall not be eligible for the credit established by
this section FOR QUALIFIED POST PRODUCTION COSTS, EXCLUDING THE COSTS
FOR VISUAL EFFECTS AND ANIMATION, unless the qualified post production
costs, EXCLUDING THE COSTS FOR VISUAL EFFECTS AND ANIMATION, at a quali-
fied post production facility meet or exceed seventy-five percent of the
total post production costs, EXCLUDING THE COSTS FOR VISUAL EFFECTS AND
ANIMATION, paid or incurred in the post production of the qualified film
at any post production facility. (II) A TAXPAYER SHALL NOT BE ELIGIBLE
FOR THE CREDIT ESTABLISHED BY THIS SECTION FOR QUALIFIED POST PRODUCTION
COSTS WHICH ARE COSTS FOR VISUAL EFFECTS OR ANIMATION UNLESS THE QUALI-
FIED POST PRODUCTION COSTS FOR VISUAL EFFECTS OR ANIMATION AT A QUALI-
FIED POST PRODUCTION FACILITY MEET OR EXCEED THREE MILLION DOLLARS OR
TWENTY PERCENT OF THE TOTAL POST PRODUCTION COSTS FOR VISUAL EFFECTS OR
ANIMATION PAID OR INCURRED IN THE POST PRODUCTION OF A QUALIFIED FILM AT
ANY POST PRODUCTION FACILITY, WHICHEVER IS LESS. (III) A TAXPAYER MAY
CLAIM A CREDIT FOR QUALIFIED POST PRODUCTION COSTS EXCLUDING THE COSTS
FOR VISUAL EFFECTS AND ANIMATION, AND FOR QUALIFIED POST PRODUCTION
COSTS OF VISUAL EFFECTS AND ANIMATION, PROVIDED THAT THE CRITERIA IN
SUBPARAGRAPHS (I) AND (II) OF THIS PARAGRAPH ARE BOTH SATISFIED. The
credit shall be allowed for the taxable year in which the production of
such qualified film is completed.
S 5-a. Subdivision (a) of section 31 of the tax law, as added by
section 12 of part Q of chapter 57 of the laws of 2010, is amended by
adding a new paragraph 5 to read as follows:
(5) 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
S. 2609--B 12 A. 3009--B
AMOUNT OF 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 SUCCEEDING TAXABLE YEARS,
WITH ONE-THIRD OF THE AMOUNT OF THE CREDIT ALLOWED BEING CLAIMED IN EACH
YEAR.
S 6. Section 3 of part Y-1 of chapter 57 of the laws of 2009, amending
the tax law relating to the empire state film production credit, is
amended to read as follows:
S 3. A. The governor's office of motion picture and television devel-
opment shall file a report on a quarterly basis with the director of the
division of the budget and the chairmen of the assembly ways and means
committee and senate finance committee. The report shall be filed within
fifteen days after the close of the calendar quarter. The first report
shall cover the calendar quarter that begins April 1, 2009. The report
must contain the following information for the calendar quarter:
(1) the total dollar amount of credits allocated during each month of
the calendar quarter, broken down by month;
(2) the number of film projects which have been allocated tax credits
of less than $1 million per project and the total dollar amount of cred-
its allocated to those projects;
(3) the number of film projects which have been allocated tax credits
of $1 million or more but less than $5 million per project and the total
dollar amount of credits allocated to those projects;
(4) the number of film projects which have been allocated tax credits
of $5 million or more per project and the total dollar amount of credits
allocated to those projects; [and]
(5) a list of each film project which has been allocated a tax credit
and for each of those projects (a) the estimated number of employees
associated with the project, (b) the estimated qualified costs for the
project, [and] (c) the estimated total costs of the project, AND (D) THE
CREDIT-ELIGIBLE MAN HOURS FOR EACH PROJECT; AND
(6)(A) THE NAME OF EACH TAXPAYER ALLOCATED A TAX CREDIT FOR EACH
PROJECT; PROVIDED HOWEVER, IF THE TAXPAYER CLAIMS A TAX CREDIT BECAUSE
THE TAXPAYER IS A MEMBER OF A LIMITED LIABILITY COMPANY, A PARTNER IN A
PARTNERSHIP OR A SHAREHOLDER IN A SUBCHAPTER S CORPORATION, THE NAME OF
EACH LIMITED LIABILITY COMPANY, PARTNERSHIP OR SUBCHAPTER S CORPORATION
EARNING ANY OF THOSE TAX CREDITS MUST BE INCLUDED IN THE REPORT INSTEAD
OF INFORMATION ABOUT THE TAXPAYER CLAIMING THE TAX CREDIT, (B) THE
AMOUNT OF TAX CREDIT ALLOCATED TO EACH TAXPAYER; PROVIDED HOWEVER, IF
THE TAXPAYER CLAIMS A TAX CREDIT BECAUSE THE TAXPAYER IS A MEMBER OF A
LIMITED LIABILITY COMPANY, A PARTNER IN A PARTNERSHIP OR A SHAREHOLDER
IN A SUBCHAPTER S CORPORATION, THE AMOUNT OF TAX CREDIT EARNED BY EACH
ENTITY MUST BE INCLUDED IN THE REPORT INSTEAD OF INFORMATION ABOUT THE
TAXPAYER CLAIMING THE TAX CREDIT, AND (C) INFORMATION IDENTIFYING THE
PROJECT ASSOCIATED WITH EACH TAXPAYER FOR WHICH A TAX CREDIT WAS CLAIMED
UNDER SECTION 24 OR SECTION 31, AS ADDED BY CHAPTER 57 OF THE LAWS OF
2010, OF THE TAX LAW, INCLUDING THE NAME OF THE FILM AND COUNTY IN WHICH
THE PROJECT IS LOCATED; AND
B. THE GOVERNOR'S OFFICE OF MOTION PICTURE AND TELEVISION DEVELOPMENT
SHALL FILE A REPORT ON A BIENNIAL BASIS WITH THE DIRECTOR OF THE DIVI-
SION OF THE BUDGET AND THE CHAIRS OF THE ASSEMBLY WAYS AND MEANS COMMIT-
TEE AND SENATE FINANCE COMMITTEE. THE REPORT SHALL BE FILED WITHIN
FIFTEEN DAYS AFTER THE CLOSE OF THE CALENDAR YEAR. THE FIRST REPORT
SHALL COVER A TWO YEAR PERIOD THAT BEGINS ON JANUARY FIRST, TWO THOUSAND
THIRTEEN. THE REPORT MUST BE PREPARED BY AN INDEPENDENT THIRD PARTY
S. 2609--B 13 A. 3009--B
AUDITOR AND INCLUDE: (1) INFORMATION REGARDING THE EMPIRE STATE FILM
PRODUCTION CREDIT AND POST PRODUCTION CREDIT PROGRAMS INCLUDING THE
EFFICIENCY OF OPERATIONS, RELIABILITY OF FINANCIAL REPORTING, COMPLIANCE
WITH LAWS AND REGULATIONS AND DISTRIBUTION OF ASSETS AND FUNDS; (2) AN
ECONOMIC IMPACT STUDY PREPARED BY AN INDEPENDENT THIRD PARTY OF THE FILM
CREDIT PROGRAMS; AND (3) ANY OTHER INFORMATION AND/OR OTHER STATISTICAL
INFORMATION THAT THE COMMISSIONER OF ECONOMIC DEVELOPMENT DEEMS TO BE
USEFUL IN ANALYZING THE EFFECTS OF THE PROGRAM.
S 7. This act shall take effect immediately, provided, however, that
sections four and five of this act shall apply to taxpayers submitting
initial applications to the governor's office of motion picture and
television development on or after the date this act shall have become a
law, and to taxpayers who filed an initial application before this act
shall have become a law but who have not yet submitted a final applica-
tion to the governor's office of motion picture and television develop-
ment on or before the date this act shall have become a law; and the
amendments made to section 3 of part Y-1 of chapter 57 of the laws of
2009, amending the tax law relating to the empire state film production
credit, with the exception of subdivision b of such section, shall only
apply to taxpayers submitting initial applications to the governor's
office of motion picture and television development on or after the date
this act shall become a law.
PART C
Section 1. Legislative intent. This act is intended to create a state-
wide network of university affiliated or college affiliated and private
sector affiliated innovation hot spots in New York state to support
start-up companies and those in the early stage of development. The
mission of the innovation hot spots shall be to promote job creation,
entrepreneurship and technology transfer, as well as to provide support
services to hot spot tenants, including, but not limited to, business
planning, management assistance, financial-packaging, linkages to
financing and technology services, and coordination with other sources
of assistance.
S 2. The economic development law is amended by adding a new section
361 to read as follows:
S 361. NEW YORK INNOVATION HOT SPOT PROGRAM. 1. DEFINITIONS. AS USED
IN THIS SECTION, THE FOLLOWING TERMS SHALL HAVE THE FOLLOWING MEANINGS:
(A) "INNOVATION HOT SPOT" SHALL MEAN A FACILITY OR FACILITIES DESIG-
NATED AS SUCH BY THE COMMISSIONER.
(B) "QUALIFIED ENTITY" SHALL MEAN A BUSINESS ENTERPRISE THAT IS:
(I) IN THE FORMATIVE STAGE OF DEVELOPMENT;
(II) LOCATED IN NEW YORK STATE;
(III) EITHER: (A) ANY CORPORATION, EXCEPT A CORPORATION WHICH:
(1) OVER FIFTY PERCENT OF THE NUMBER OF SHARES OF STOCK ENTITLING THE
HOLDERS THEREOF TO VOTE FOR THE ELECTION OF DIRECTORS OR TRUSTEES IS
OWNED OR CONTROLLED, EITHER DIRECTLY OR INDIRECTLY, BY A TAXPAYER
SUBJECT TO TAX UNDER THE FOLLOWING PROVISIONS OF THE TAX LAW: ARTICLE
NINE-A; SECTION ONE HUNDRED EIGHTY-THREE, ONE HUNDRED EIGHTY-FOUR OR ONE
HUNDRED EIGHTY-FIVE OF ARTICLE NINE; ARTICLE THIRTY-TWO OR ARTICLE THIR-
TY-THREE; OR
(2) IS SUBSTANTIALLY SIMILAR IN OPERATION AND IN OWNERSHIP TO A BUSI-
NESS ENTITY (OR ENTITIES) TAXABLE OR PREVIOUSLY TAXABLE UNDER THE
FOLLOWING PROVISIONS OF THE TAX LAW: ARTICLE NINE-A; SECTION ONE HUNDRED
EIGHTY-THREE, ONE HUNDRED EIGHTY-FOUR, ONE HUNDRED EIGHTY-FIVE OR FORMER
S. 2609--B 14 A. 3009--B
SECTION ONE HUNDRED EIGHTY-SIX OF ARTICLE NINE; ARTICLE THIRTY-TWO;
ARTICLE THIRTY-THREE; ARTICLE TWENTY-THREE, OR WOULD HAVE BEEN SUBJECT
TO TAX UNDER SUCH ARTICLE TWENTY-THREE (AS SUCH ARTICLE WAS IN EFFECT ON
JANUARY FIRST, NINETEEN HUNDRED EIGHTY) OR THE INCOME (OR LOSSES) OF
WHICH IS (OR WAS) INCLUDABLE UNDER ARTICLE TWENTY-TWO; OR
(B) A SOLE PROPRIETORSHIP, PARTNERSHIP, LIMITED LIABILITY COMPANY, OR
NEW YORK SUBCHAPTER S CORPORATION THAT IS NOT SUBSTANTIALLY SIMILAR IN
OPERATION AND IN OWNERSHIP TO A BUSINESS ENTITY (OR ENTITIES) TAXABLE,
OR PREVIOUSLY TAXABLE, UNDER ARTICLE NINE-A OF THE TAX LAW, SECTION ONE
HUNDRED EIGHTY-THREE, ONE HUNDRED EIGHTY-FOUR, ONE HUNDRED EIGHTY-FIVE
OR FORMER SECTION ONE HUNDRED EIGHTY-SIX OF ARTICLE NINE OF THE TAX LAW,
ARTICLE THIRTY-TWO OR THIRTY-THREE OF THE TAX LAW, ARTICLE TWENTY-THREE
OF THE TAX LAW OR WHICH WOULD HAVE BEEN SUBJECT TO TAX UNDER SUCH ARTI-
CLE TWENTY-THREE (AS SUCH ARTICLE WAS IN EFFECT ON JANUARY FIRST, NINE-
TEEN HUNDRED EIGHTY) OR THE INCOME (OR LOSSES) OF WHICH IS (OR WAS)
INCLUDABLE UNDER ARTICLE TWENTY-TWO OF THE TAX LAW; AND
(IV) IS APPROVED TO LOCATE IN AN INNOVATION HOT SPOT BY THE OPERATOR
OF SUCH INNOVATION HOT SPOT.
(C) "OPERATOR OF AN INNOVATION HOT SPOT" SHALL MEAN:
(I) AN ACCREDITED POST-SECONDARY EDUCATIONAL INSTITUTION, COLLEGE OR
UNIVERSITY; NOT-FOR-PROFIT ENTITY AFFILIATED WITH A HIGHER EDUCATIONAL
INSTITUTION; OR, COLLABORATIVE ENTERPRISE BETWEEN ONE OR MORE ACCREDITED
POST-SECONDARY EDUCATIONAL INSTITUTION, COLLEGE OR UNIVERSITY AND
NOT-FOR-PROFIT ENTITY AFFILIATED WITH A HIGHER EDUCATIONAL INSTITUTION;
(II) LOCATED IN NEW YORK STATE; AND
(III) DESIGNATED BY THE COMMISSIONER TO OPERATE A FACILITY THAT
PROVIDES: LOW-COST SPACE; TECHNICAL ASSISTANCE; SUPPORT SERVICES,
INCLUDING, BUT NOT LIMITED TO, CENTRAL SERVICES; AND, EDUCATIONAL OPPOR-
TUNITIES, TO A "QUALIFIED ENTITY."
2. THE COMMISSIONER SHALL:
(A) SOLICIT APPLICATIONS FROM POST-SECONDARY EDUCATIONAL INSTITUTIONS,
COLLEGES, UNIVERSITIES, OR NOT-FOR-PROFIT ENTITIES AFFILIATED WITH A
HIGHER EDUCATION INSTITUTION OR COLLABORATIVE ENTERPRISES BETWEEN ONE OR
MORE ACCREDITED POST-SECONDARY EDUCATIONAL INSTITUTIONS, COLLEGES, OR
UNIVERSITIES AND NOT-FOR-PROFIT ENTITIES FOR APPROVAL TO OPERATE INNO-
VATION HOT SPOTS IN PROPERTY OWNED OR LEASED BY SUCH ENTITIES TO ATTRACT
INDUSTRIES WITH SIGNIFICANT POTENTIAL FOR ECONOMIC GROWTH AND DEVELOP-
MENT IN NEW YORK STATE, AND IDENTIFY TECHNOLOGICAL AREAS THAT CAN
CONTRIBUTE TO THE GROWTH OF VARIOUS INDUSTRIES LOCATED THROUGHOUT NEW
YORK STATE;
(B) RECEIVE RECOMMENDATIONS FROM THE REGIONAL ECONOMIC DEVELOPMENT
COUNCILS REGARDING THE APPROVAL OR REJECTION OF THE APPLICANTS AS OPERA-
TORS OF INNOVATION HOT SPOTS.
3. THE COMMISSIONER SHALL ESTABLISH CRITERIA CONCERNING THE INNOVATION
HOT SPOT PROGRAM. (A) THE CRITERIA THAT APPLICANTS MUST SATISFY TO BE
DESIGNATED AS AN OPERATOR OF AN INNOVATION HOT SPOT INCLUDE, BUT ARE NOT
LIMITED TO, THE FOLLOWING:
(I) A RECORD OF, OR PLAN TO CONFORM TO, BEST PRACTICES INCLUDING, BUT
NOT LIMITED TO, CLEAR POLICIES FOR THE RESIDENT BUSINESS ENTITIES AND
GRADUATION FROM THE SPACE;
(II) A COMPREHENSIVE SUITE OF ENTREPRENEURIAL MENTORING PRACTICES
INCLUDING, BUT NOT LIMITED TO, ADVISING, COACHING, PLANNING AND CONNECT-
ING TO FUNDING AND TECHNOLOGY SOURCES;
(III) THE CAPACITY TO SECURE SUBSTANTIAL PRIVATE AND OTHER NON-STATE
GOVERNMENTAL FUNDING FOR THE PROPOSED INNOVATION HOT SPOT, IN ADDITION
S. 2609--B 15 A. 3009--B
TO DIRECT SUPPORT FROM THE SPONSORING ACADEMIC INSTITUTION OR RELATED
FOUNDATION;
(IV) THE ABILITY AND WILLINGNESS TO COOPERATE WITH OTHER LOCAL,
REGIONAL AND STATEWIDE ECONOMIC DEVELOPMENT ORGANIZATIONS, BUSINESS
SUPPORT NETWORKS, VENTURE AND ANGEL CAPITAL FUNDING SOURCES, AND WORK-
FORCE DEVELOPMENT ADVOCATES;
(V) THE CAPACITY TO COLLABORATE WITH OTHER BUSINESSES AND INDUSTRIES
INDIVIDUALLY; AND
(VI) SUCH OTHER REQUIREMENTS AS THE DEPARTMENT DEEMS APPROPRIATE FOR
THE FORMAT, CONTENT AND FILING OF APPLICATIONS FOR DESIGNATION AS INNO-
VATION HOT SPOTS.
(B) THE COMMISSIONER SHALL ALSO ESTABLISH CRITERIA FOR THE DESIGNATION
OF INNOVATION HOT SPOTS.
(C) AFTER ESTABLISHING SUCH CRITERIA, THE COMMISSIONER SHALL APPROVE
AND DESIGNATE FIVE INNOVATION HOT SPOTS AND THEIR OPERATORS IN FISCAL
YEAR TWO THOUSAND THIRTEEN--TWO THOUSAND FOURTEEN AND FIVE ADDITIONAL
INNOVATION HOT SPOTS AND THEIR OPERATORS IN FISCAL YEAR TWO THOUSAND
FOURTEEN--TWO THOUSAND FIFTEEN.
(D) THE COMMISSIONER SHALL ISSUE A CERTIFICATE OF APPROVAL FOR EACH
DESIGNATED INNOVATION HOT SPOT AND EACH APPROVED OPERATOR OF AN INNO-
VATION HOT SPOT.
(E) THE OPERATOR OF AN APPROVED INNOVATION HOT SPOT MAY ACCEPT APPLI-
CATIONS FOR TENANCIES FROM QUALIFIED ENTITIES FOR A PERIOD OF FIVE YEARS
AFTER THE RECEIPT BY SUCH INNOVATION HOT SPOT OF ITS CERTIFICATE OF
APPROVAL FROM THE COMMISSIONER. QUALIFIED ENTITIES THAT LOCATE THEIR
BUSINESSES IN AN INNOVATION HOT SPOT ARE ELIGIBLE TO RECEIVE TAX BENE-
FITS UNDER SECTION THIRTY-EIGHT OF THE TAX LAW FOR FIVE TAXABLE YEARS,
BEGINNING WITH THE FIRST TAXABLE YEAR DURING WHICH SUCH QUALIFIED ENTI-
TIES BECOME TENANTS IN AN INNOVATION HOT SPOT.
4. EACH OPERATOR OF AN INNOVATION HOT SPOT SHALL REPORT ON AN ANNUAL
BASIS ON ITS ACTIVITIES TO THE COMMISSIONER IN A MANNER AND ACCORDING TO
THE SCHEDULE ESTABLISHED BY THE DEPARTMENT, AND SHALL PROVIDE SUCH ADDI-
TIONAL INFORMATION AS THE COMMISSIONER MAY REQUIRE. THE COMMISSIONER
SHALL EVALUATE THE OPERATIONS OF THE INNOVATION HOT SPOTS USING METHODS
INCLUDING BUT NOT LIMITED TO SITE VISITS, REPORTS PURSUANT TO SPECIFIED
INFORMATION, AND REVIEW EVALUATIONS. IF THE COMMISSIONER IS UNSATISFIED
WITH THE PROGRESS OF AN OPERATOR OF AN INNOVATION HOT SPOT, THE COMMIS-
SIONER SHALL NOTIFY SUCH OPERATOR OF THE RESULTS OF ITS EVALUATIONS AND
THE FINDINGS OF DEFICIENCIES IN THE OPERATION OF SUCH HOT SPOT AND SHALL
ALLOW AND COOPERATE WITH SUCH OPERATOR TO REMEDY SUCH FINDINGS IN A
TIMELY MANNER.
5. NOTWITHSTANDING ANY PROVISION OF THIS CHAPTER, EMPLOYEES AND OFFI-
CERS OF THE DEPARTMENT AND THE DEPARTMENT OF TAXATION AND FINANCE SHALL
BE ALLOWED AND ARE DIRECTED TO SHARE AND EXCHANGE:
(I) INFORMATION DERIVED FROM TAX RETURNS OR REPORTS THAT IS RELEVANT
TO A QUALIFIED ENTITY'S ELIGIBILITY TO PARTICIPATE IN THE INNOVATION HOT
SPOTS PROGRAM, AND
(II) INFORMATION REGARDING THE TAX BENEFITS APPLIED FOR, ALLOWED, OR
CLAIMED PURSUANT TO SECTION THIRTY-EIGHT OF THE TAX LAW AND THE TAXPAY-
ERS WHO ARE APPLYING FOR OR ARE CLAIMING THE TAX BENEFITS.
ALL INFORMATION EXCHANGED BETWEEN THE DEPARTMENT AND THE DEPARTMENT OF
TAXATION AND FINANCE SHALL NOT BE SUBJECT TO DISCLOSURE OR INSPECTION
PURSUANT TO THE STATE'S FREEDOM OF INFORMATION LAW. THE DEPARTMENT
SHALL NOT DISCLOSE ANY INFORMATION OBTAINED FROM THE DEPARTMENT OF TAXA-
TION AND FINANCE THAT CONCERNS SPECIFIC TAXPAYERS.
S. 2609--B 16 A. 3009--B
S 3. The tax law is amended by adding a new section 38 to read as
follows:
S 38. NEW YORK INNOVATION HOT SPOT PROGRAM TAX BENEFITS. (A) AS USED
IN THIS CHAPTER, THE TERMS "INNOVATION HOT SPOT" AND "QUALIFIED ENTITY"
SHALL HAVE THE SAME MEANING AS UNDER SECTION THREE HUNDRED SIXTY-ONE OF
THE ECONOMIC DEVELOPMENT LAW.
(B) A TAXPAYER UNDER ARTICLE NINE-A OF THIS CHAPTER THAT IS A QUALI-
FIED ENTITY AND ALSO A TENANT IN AN INNOVATION HOT SPOT SHALL BE SUBJECT
ONLY TO THE FIXED DOLLAR MINIMUM TAX, IMPOSED UNDER PARAGRAPH (D) OF
SUBDIVISION ONE OF SECTION TWO HUNDRED TEN OF THIS CHAPTER, FOR FIVE
TAXABLE YEARS, BEGINNING WITH THE FIRST TAXABLE YEAR DURING WHICH THE
QUALIFIED ENTITY BECOMES A TENANT IN AN INNOVATION HOT SPOT. A TAXPAYER
UNDER ARTICLE NINE-A OF THIS CHAPTER THAT IS A CORPORATE PARTNER IN A
QUALIFIED ENTITY, OR IS A QUALIFIED ENTITY THAT IS LOCATED BOTH WITHIN
AND WITHOUT AN INNOVATION HOT SPOT, SHALL BE ALLOWED ONLY A DEDUCTION
FOR THE AMOUNT OF INCOME OR GAIN INCLUDED IN ITS FEDERAL TAXABLE INCOME
TO THE EXTENT THAT THE INCOME OR GAIN IS ATTRIBUTABLE TO THE OPERATIONS
AT THE INNOVATION HOT SPOT. THE DEDUCTION IS ALLOWED FOR FIVE TAXABLE
YEARS, BEGINNING WITH THE FIRST TAXABLE YEAR DURING WHICH THE QUALIFIED
ENTITY BECOMES A TENANT IN AN INNOVATION HOT SPOT.
(C) AN INDIVIDUAL WHO IS THE SOLE PROPRIETOR OF A QUALIFIED ENTITY OR
A MEMBER OF A LIMITED LIABILITY COMPANY, A PARTNER IN A PARTNERSHIP OR A
SHAREHOLDER IN A NEW YORK SUBCHAPTER S CORPORATION WHERE THE LIMITED
LIABILITY COMPANY, PARTNERSHIP, OR S CORPORATION IS A QUALIFIED ENTITY,
THAT IS TAXABLE UNDER ARTICLE TWENTY-TWO OF THIS CHAPTER SHALL BE
ALLOWED A DEDUCTION FOR THE AMOUNT OF INCOME OR GAIN INCLUDED IN ITS
FEDERAL ADJUSTED GROSS INCOME TO THE EXTENT THAT THE INCOME OR GAIN IS
ATTRIBUTABLE TO THE OPERATIONS OF A QUALIFIED ENTITY WHICH IS A TENANT
IN AN INNOVATION HOT SPOT. THE DEDUCTION IS ALLOWED FOR FIVE TAXABLE
YEARS, BEGINNING WITH THE FIRST TAXABLE YEAR DURING WHICH THE QUALIFIED
ENTITY BECOMES A TENANT IN AN INNOVATION HOT SPOT.
(D) A QUALIFIED ENTITY THAT IS A TENANT IN AN INNOVATION HOT SPOT
SHALL BE ELIGIBLE FOR A CREDIT OR REFUND FOR SALES AND USE TAXES IMPOSED
ON THE RETAIL SALE OF TANGIBLE PERSONAL PROPERTY OR SERVICES UNDER
SUBDIVISIONS (A), (B), AND (C) OF SECTION ELEVEN HUNDRED FIVE AND
SECTION ELEVEN HUNDRED TEN OF THIS CHAPTER. THE CREDIT OR REFUND SHALL
BE ALLOWED FOR SIXTY MONTHS BEGINNING WITH THE FIRST FULL MONTH AFTER
THE QUALIFIED ENTITY BECOMES A TENANT IN AN INNOVATION HOT SPOT.
(E) A TAXPAYER WHO CLAIMS ANY OF THE TAX BENEFITS DESCRIBED IN THIS
SECTION IS NO LONGER ELIGIBLE FOR ANY OTHER NEW YORK STATE EXEMPTIONS,
DEDUCTIONS, OR CREDIT OR REFUNDS UNDER THIS CHAPTER TO THE EXTENT THAT
ANY SUCH EXEMPTION, DEDUCTION, CREDIT OR REFUND IS ATTRIBUTABLE TO THE
BUSINESS OPERATIONS OF A TENANT IN AN INNOVATION HOT SPOT. THE ELECTION
TO CLAIM THE TAX BENEFITS DESCRIBED IN THIS SECTION IS NOT REVOCABLE.
(F) CROSS-REFERENCES. FOR APPLICATION OF THE TAX BENEFITS PROVIDED FOR
IN THIS SECTION, SEE THE FOLLOWING PROVISIONS OF THIS CHAPTER:
(I) ARTICLE 9-A, SECTION 208, SUBDIVISION (9), PARAGRAPH (A), SUBPARA-
GRAPH (18).
(II) ARTICLE 9-A, SECTION 209, SUBDIVISION 11.
(III) ARTICLE 22, SECTION 612, SUBSECTION (C), PARAGRAPH (39).
(IV) ARTICLE 28, SECTION 1119, SUBDIVISION (D).
S 4. Paragraph (a) of subdivision 9 of section 208 of the tax law is
amended by adding a new subparagraph 18 to read as follows:
(18) THE AMOUNT OF INCOME OR GAIN INCLUDED IN FEDERAL TAXABLE INCOME
OF A TAXPAYER THAT IS A PARTNER IN A QUALIFIED ENTITY OR IS A QUALIFIED
ENTITY THAT IS LOCATED BOTH WITHIN AND WITHOUT AN INNOVATION HOT SPOT,
S. 2609--B 17 A. 3009--B
TO THE EXTENT THAT THE INCOME OR GAIN IS ATTRIBUTABLE TO THE OPERATIONS
OF A QUALIFIED ENTITY AT THE INNOVATION HOT SPOT AS PROVIDED IN SECTION
THIRTY-EIGHT OF THIS CHAPTER.
S 5. Section 209 of the tax law is amended by adding a new subdivision
11 to read as follows:
11. EXCEPT AS PROVIDED IN SUBPARAGRAPH EIGHTEEN OF PARAGRAPH (A) OF
SUBDIVISION NINE OF SECTION TWO HUNDRED EIGHT OF THIS ARTICLE, A CORPO-
RATION THAT IS A QUALIFIED ENTITY AND ALSO A TENANT IN AN INNOVATION HOT
SPOT SHALL BE SUBJECT ONLY TO THE FIXED DOLLAR MINIMUM TAX UNDER PARA-
GRAPH (D) OF SUBDIVISION ONE OF SECTION TWO HUNDRED TEN OF THIS ARTICLE,
AS PROVIDED IN SECTION THIRTY-EIGHT OF THIS CHAPTER.
S 6. Subsection (c) of section 612 of the tax law is amended by adding
a new paragraph 39 to read as follows:
(39) ANY INCOME OR GAIN, TO THE EXTENT IT IS INCLUDED IN FEDERAL
ADJUSTED GROSS INCOME OF AN INDIVIDUAL WHO IS THE SOLE PROPRIETOR OF A
QUALIFIED ENTITY OR A MEMBER OF A LIMITED LIABILITY COMPANY, A PARTNER
IN A PARTNERSHIP OR A SHAREHOLDER IN A NEW YORK SUBCHAPTER S CORPORATION
THAT IS A QUALIFIED ENTITY, ATTRIBUTABLE TO THE OPERATIONS OF A QUALI-
FIED ENTITY AT ITS LOCATION IN AN INNOVATION HOT SPOT, AS PROVIDED IN
SECTION THIRTY-EIGHT OF THIS CHAPTER.
S 7. Paragraph 1 of subdivision (d) of section 1119 of the tax law, as
added by section 31 of part S-1 of chapter 57 of the laws of 2009, is
amended to read as follows:
(1) Subject to the conditions and limitations provided for in this
section, a refund or credit will be allowed for taxes imposed on the
retail sale of tangible personal property described in subdivision (a)
of section eleven hundred five of this article, and on every sale of
services described in subdivisions (b) and (c) of such section, and
consideration given or contracted to be given for, or for the use of,
such tangible personal property or services, where such tangible
personal property or services are sold to a qualified empire zone enter-
prise OR TO A QUALIFIED ENTITY THAT IS ALSO A TENANT IN AN INNOVATION
HOT SPOT AS PROVIDED IN SECTION THIRTY-EIGHT OF THIS CHAPTER, provided
that (A) such tangible personal property or tangible personal property
upon which such a service has been performed or such service (other than
a service described in subdivision (b) of section eleven hundred five of
this article) is directly and predominantly, or such a service described
in clause (A) or (D) of paragraph one of such subdivision (b) of section
eleven hundred five of this article is directly and exclusively, used or
consumed by (I) such QUALIFIED EMPIRE ZONE enterprise in an area desig-
nated as an empire zone pursuant to article eighteen-B of the general
municipal law with respect to which such enterprise is certified pursu-
ant to such article eighteen-B, OR (II) SUCH QUALIFIED ENTITY IN AN
INNOVATION HOT SPOT or (B) such a service described in clause (B) or (C)
of paragraph one of subdivision (b) of section eleven hundred five of
this article is delivered and billed to (I) such enterprise at an
address in such empire zone OR (II) SUCH QUALIFIED ENTITY AT THE ADDRESS
OF THE INNOVATION HOT SPOT WHERE IT IS A TENANT, or (C) the enterprise's
place of primary use of the service described in paragraph two of such
subdivision (b) of section eleven hundred five is at an address in such
empire zone OR AT AN INNOVATION HOT SPOT; provided, further, that, in
order for a motor vehicle, as defined in subdivision (c) of section
eleven hundred seventeen of this article, or tangible personal property
related to such a motor vehicle to be found to be used predominantly in
such a zone, at least fifty percent of such motor vehicle's use shall be
exclusively within such zone or at least fifty percent of such motor
S. 2609--B 18 A. 3009--B
vehicle's use shall be in activities originating or terminating in such
zone, or both; and either or both such usages shall be computed either
on the basis of mileage or hours of use, at the discretion of such
enterprise. For purposes of this subdivision, tangible personal property
related to such a motor vehicle shall include a battery, diesel motor
fuel, an engine, engine components, motor fuel, a muffler, tires and
similar tangible personal property used in or on such a motor vehicle.
S 8. Subdivision (c) of section 11-1712 of the administrative code of
the city of New York is amended by adding a new paragraph 35 to read as
follows:
(35) AS PROVIDED IN SECTION THIRTY-EIGHT OF THE TAX LAW, ANY INCOME OR
GAIN, TO THE EXTENT IT IS INCLUDED IN FEDERAL ADJUSTED GROSS INCOME OF
AN INDIVIDUAL WHO IS THE SOLE PROPRIETOR OF A QUALIFIED ENTITY OR A
MEMBER OF A LIMITED LIABILITY COMPANY, A PARTNER IN A PARTNERSHIP OR A
SHAREHOLDER IN A NEW YORK SUBCHAPTER S CORPORATION THAT IS A QUALIFIED
ENTITY AS DEFINED IN PARAGRAPH (B) OF SUBDIVISION ONE OF SECTION THREE
HUNDRED SIXTY-ONE OF THE ECONOMIC DEVELOPMENT LAW, ATTRIBUTABLE TO THE
OPERATIONS OF SUCH QUALIFIED ENTITY AT ITS LOCATION IN AN INNOVATION HOT
SPOT, AS DEFINED IN PARAGRAPH (A) OF SUBDIVISION ONE OF SECTION THREE
HUNDRED SIXTY-ONE OF THE ECONOMIC DEVELOPMENT LAW.
S 9. This act shall take effect immediately.
PART D
Section 1. Subsection (g) of section 615 of the tax law, as added by
section 3 of part HH of chapter 57 of the laws of 2010, is amended to
read as follows:
(g)(1) With respect to an individual whose New York adjusted gross
income is over one million dollars and no more than ten million dollars,
the New York itemized deduction shall be an amount equal to fifty
percent of any charitable contribution deduction allowed under section
one hundred seventy of the internal revenue code for taxable years
beginning after two thousand nine and before two thousand [thirteen]
SIXTEEN. With respect to an individual whose New York adjusted gross
income is over one million dollars, the New York itemized deduction
shall be an amount equal to fifty percent of any charitable contribution
deduction allowed under section one hundred seventy of the internal
revenue code for taxable years beginning in two thousand nine or after
two thousand [twelve] FIFTEEN.
(2) With respect to an individual whose New York adjusted gross income
is over ten million dollars, the New York itemized deduction shall be an
amount equal to twenty-five percent of any charitable contribution
deduction allowed under section one hundred seventy of the internal
revenue code for taxable years beginning after two thousand nine and
ending before two thousand [thirteen] SIXTEEN.
S 2. Subdivision (g) of section 11-1715 of the administrative code of
the city of New York, as added by section 7 of part HH of chapter 57 of
the laws of 2010, is amended to read as follows:
(g) (1) With respect to an individual whose New York adjusted gross
income is over one million dollars but no more than ten million dollars,
the New York itemized deduction shall be an amount equal to fifty
percent of any charitable contribution deduction allowed under section
one hundred seventy of the internal revenue code for taxable years
beginning after two thousand nine and before two thousand [thirteen]
SIXTEEN. With respect to an individual whose New York adjusted gross
income is over one million dollars, the New York itemized deduction
S. 2609--B 19 A. 3009--B
shall be an amount equal to fifty percent of any charitable contribution
deduction allowed under section one hundred seventy of the internal
revenue code for taxable years beginning in two thousand nine or after
two thousand [twelve] FIFTEEN.
(2) With respect to an individual whose New York adjusted gross income
is over ten million dollars, the New York itemized deduction shall be an
amount equal to twenty-five percent of any charitable contribution
deduction allowed under section one hundred seventy of the internal
revenue code for taxable years beginning after two thousand nine AND
ENDING BEFORE TWO THOUSAND SIXTEEN.
S 3. This act shall take effect immediately.
PART E
Section 1. Subparagraph 17 of paragraph (a) of subdivision 9 of
section 208 of the tax law is REPEALED.
S 2. Paragraph (o) of subdivision 9 of section 208 of the tax law, as
amended by section 1 of part M of chapter 686 of the laws of 2003,
clause (A) of subparagraph 2 as amended by section 4 of part J of chap-
ter 60 of the laws of 2007, is amended to read as follows:
(o) Related members expense add back [and income exclusion]. (1) Defi-
nitions. (A) Related member [or members. For purposes of this paragraph,
the term related member or members means a person, corporation, or other
entity, including an entity that is treated as a partnership or other
pass-through vehicle for purposes of federal taxation, whether such
person, corporation or entity is a taxpayer or not, where one such
person, corporation, or entity, or set of related persons, corporations
or entities, directly or indirectly owns or controls a controlling
interest in another entity. Such entity or entities may include all
taxpayers under articles nine, nine-A, thirteen, twenty-two, thirty-two,
thirty-three or thirty-three-A of this chapter]. "RELATED MEMBER" MEANS
A RELATED PERSON AS DEFINED IN SUBPARAGRAPH (C) OF PARAGRAPH THREE OF
SUBSECTION (B) OF SECTION FOUR HUNDRED SIXTY-FIVE OF THE INTERNAL REVEN-
UE CODE, EXCEPT THAT "FIFTY PERCENT" SHALL BE SUBSTITUTED FOR "TEN
PERCENT".
(B) [Controlling interest. A controlling interest shall mean (i) in
the case of a corporation, either thirty percent or more of the total
combined voting power of all classes of stock of such corporation, or
thirty percent or more of the capital, profits or beneficial interest in
such voting stock of such corporation, and (ii) in the case of a part-
nership, association, trust or other entity, thirty percent or more of
the capital, profits or beneficial interest in such partnership, associ-
ation, trust or other entity.] EFFECTIVE RATE OF TAX. "EFFECTIVE RATE OF
TAX" MEANS, AS TO ANY STATE OR U.S. POSSESSION, THE MAXIMUM STATUTORY
RATE OF TAX IMPOSED BY THE STATE OR POSSESSION ON OR MEASURED BY A
RELATED MEMBER'S NET INCOME MULTIPLIED BY THE APPORTIONMENT PERCENTAGE,
IF ANY, APPLICABLE TO THE RELATED MEMBER UNDER THE LAWS OF SAID JURIS-
DICTION. FOR PURPOSES OF THIS DEFINITION, THE EFFECTIVE RATE OF TAX AS
TO ANY STATE OR U.S. POSSESSION IS ZERO WHERE THE RELATED MEMBER'S NET
INCOME TAX LIABILITY IN SAID JURISDICTION IS REPORTED ON A COMBINED OR
CONSOLIDATED RETURN INCLUDING BOTH THE TAXPAYER AND THE RELATED MEMBER
WHERE THE REPORTED TRANSACTIONS BETWEEN THE TAXPAYER AND THE RELATED
MEMBER ARE ELIMINATED OR OFFSET. ALSO, FOR PURPOSES OF THIS DEFINITION,
WHEN COMPUTING THE EFFECTIVE RATE OF TAX FOR A JURISDICTION IN WHICH A
RELATED MEMBER'S NET INCOME IS ELIMINATED OR OFFSET BY A CREDIT OR SIMI-
LAR ADJUSTMENT THAT IS DEPENDENT UPON THE RELATED MEMBER EITHER MAIN-
S. 2609--B 20 A. 3009--B
TAINING OR MANAGING INTANGIBLE PROPERTY OR COLLECTING INTEREST INCOME IN
THAT JURISDICTION, THE MAXIMUM STATUTORY RATE OF TAX IMPOSED BY SAID
JURISDICTION SHALL BE DECREASED TO REFLECT THE STATUTORY RATE OF TAX
THAT APPLIES TO THE RELATED MEMBER AS EFFECTIVELY REDUCED BY SUCH CREDIT
OR SIMILAR ADJUSTMENT.
(C) Royalty payments. Royalty payments are payments directly connected
to the acquisition, use, maintenance or management, ownership, sale,
exchange, or any other disposition of licenses, trademarks, copyrights,
trade names, trade dress, service marks, mask works, trade secrets,
patents and any other similar types of intangible assets as determined
by the commissioner, and [includes] INCLUDE amounts allowable as inter-
est deductions under section one hundred sixty-three of the internal
revenue code to the extent such amounts are directly or indirectly for,
related to or in connection with the acquisition, use, maintenance or
management, ownership, sale, exchange or disposition of such intangible
assets.
(D) Valid Business Purpose. A valid business purpose is one or more
business purposes, other than the avoidance or reduction of taxation,
which alone or in combination constitute the primary motivation for some
business activity or transaction, which activity or transaction changes
in a meaningful way, apart from tax effects, the economic position of
the taxpayer. The economic position of the taxpayer includes an increase
in the market share of the taxpayer, or the entry by the taxpayer into
new business markets.
(2) Royalty expense add backs. (A) Except where a taxpayer is included
in a combined report with a related member pursuant to subdivision four
of section two hundred eleven of this article, for the purpose of
computing entire net income or other applicable taxable basis, a taxpay-
er must add back royalty payments [to a] DIRECTLY OR INDIRECTLY PAID,
ACCRUED, OR INCURRED IN CONNECTION WITH ONE OR MORE DIRECT OR INDIRECT
TRANSACTIONS WITH ONE OR MORE related [member] MEMBERS during the taxa-
ble year to the extent deductible in calculating federal taxable income.
(B) [The add back of royalty payments shall not be required if and to
the extent that such payments meet either of the following conditions:
(i) the related member during the same taxable year directly or indi-
rectly paid or incurred the amount to a person or entity that is not a
related member, and such transaction was done for a valid business
purpose and the payments are made at arm's length;
(ii) the royalty payments are paid or incurred to a related member
organized under the laws of a country other than the United States, are
subject to a comprehensive income tax treaty between such country and
the United States, and are taxed in such country at a tax rate at least
equal to that imposed by this state.
(3) Royalty income exclusions. For the purpose of computing entire net
income or other taxable basis, a taxpayer shall be allowed to deduct
royalty payments directly or indirectly received from a related member
during the taxable year to the extent included in the taxpayer's federal
taxable income unless such royalty payments would not be required to be
added back under subparagraph two of this paragraph or other similar
provision in this chapter.] EXCEPTIONS. (I) THE ADJUSTMENT REQUIRED IN
THIS PARAGRAPH SHALL NOT APPLY TO THE PORTION OF THE ROYALTY PAYMENT
THAT THE TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE OF THE
TYPE AND IN THE FORM SPECIFIED BY THE COMMISSIONER, MEETS ALL OF THE
FOLLOWING REQUIREMENTS: (I) THE RELATED MEMBER WAS SUBJECT TO TAX IN
THIS STATE OR ANOTHER STATE OR POSSESSION OF THE UNITED STATES OR A
FOREIGN NATION OR SOME COMBINATION THEREOF ON A TAX BASE THAT INCLUDED
S. 2609--B 21 A. 3009--B
THE ROYALTY PAYMENT PAID, ACCRUED OR INCURRED BY THE TAXPAYER; (II) THE
RELATED MEMBER DURING THE SAME TAXABLE YEAR DIRECTLY OR INDIRECTLY PAID,
ACCRUED OR INCURRED SUCH PORTION TO A PERSON THAT IS NOT A RELATED
MEMBER; AND (III) THE TRANSACTION GIVING RISE TO THE ROYALTY PAYMENT
BETWEEN THE TAXPAYER AND THE RELATED MEMBER WAS UNDERTAKEN FOR A VALID
BUSINESS PURPOSE.
(II) THE ADJUSTMENT REQUIRED IN THIS PARAGRAPH SHALL NOT APPLY IF THE
TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE OF THE TYPE AND
IN THE FORM SPECIFIED BY THE COMMISSIONER, THAT: (I) THE RELATED MEMBER
WAS SUBJECT TO TAX ON OR MEASURED BY ITS NET INCOME IN THIS STATE OR
ANOTHER STATE OR POSSESSION OF THE UNITED STATES OR SOME COMBINATION
THEREOF; (II) THE TAX BASE FOR SAID TAX INCLUDED THE ROYALTY PAYMENT
PAID, ACCRUED OR INCURRED BY THE TAXPAYER; AND (III) THE AGGREGATE
EFFECTIVE RATE OF TAX APPLIED TO THE RELATED MEMBER IN THOSE JURISDIC-
TIONS IS NO LESS THAN EIGHTY PERCENT OF THE STATUTORY RATE OF TAX THAT
APPLIED TO THE TAXPAYER UNDER SECTION TWO HUNDRED TEN OF THIS ARTICLE
FOR THE TAXABLE YEAR.
(III) THE ADJUSTMENT REQUIRED IN THIS PARAGRAPH SHALL NOT APPLY IF THE
TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE OF THE TYPE AND
IN THE FORM SPECIFIED BY THE COMMISSIONER, THAT: (I) THE ROYALTY PAYMENT
WAS PAID, ACCRUED OR INCURRED TO A RELATED MEMBER ORGANIZED UNDER THE
LAWS OF A COUNTRY OTHER THAN THE UNITED STATES; (II) THE RELATED
MEMBER'S INCOME FROM THE TRANSACTION WAS SUBJECT TO A COMPREHENSIVE
INCOME TAX TREATY BETWEEN SUCH COUNTRY AND THE UNITED STATES; (III) THE
RELATED MEMBER WAS SUBJECT TO TAX IN A FOREIGN NATION ON A TAX BASE THAT
INCLUDED THE ROYALTY PAYMENT PAID, ACCRUED OR INCURRED BY THE TAXPAYER;
(IV) THE RELATED MEMBER'S INCOME FROM THE TRANSACTION WAS TAXED IN SUCH
COUNTRY AT AN EFFECTIVE RATE OF TAX AT LEAST EQUAL TO THAT IMPOSED BY
THIS STATE; AND (V) THE ROYALTY PAYMENT WAS PAID, ACCRUED OR INCURRED
PURSUANT TO A TRANSACTION THAT WAS UNDERTAKEN FOR A VALID BUSINESS
PURPOSE AND USING TERMS THAT REFLECT AN ARM'S LENGTH RELATIONSHIP.
(IV) THE ADJUSTMENT REQUIRED IN THIS PARAGRAPH SHALL NOT APPLY IF THE
TAXPAYER AND THE COMMISSIONER AGREE IN WRITING TO THE APPLICATION OR USE
OF ALTERNATIVE ADJUSTMENTS OR COMPUTATIONS. THE COMMISSIONER MAY, IN HIS
OR HER DISCRETION, AGREE TO THE APPLICATION OR USE OF ALTERNATIVE
ADJUSTMENTS OR COMPUTATIONS WHEN HE OR SHE CONCLUDES THAT IN THE ABSENCE
OF SUCH AGREEMENT THE INCOME OF THE TAXPAYER WOULD NOT BE PROPERLY
REFLECTED.
S 3. Paragraph 6 of subdivision (a) of section 292 of the tax law, as
amended by section 15 of part M of chapter 686 of the laws of 2003, is
amended to read as follows:
(6) Related members expense add back [and income exclusion]. (A)
Definitions. (i) Related member [or members. For purposes of this para-
graph, the term related member or members means a person, corporation,
or other entity, including an entity that is treated as a partnership or
other pass-through vehicle for purposes of federal taxation, whether
such person, corporation or entity is a taxpayer or not, where one such
person, corporation, or entity, or set of related persons, corporations
or entities, directly or indirectly owns or controls a controlling
interest in another entity. Such entity or entities may include all
taxpayers under article nine, nine-A, thirteen, twenty-two, thirty-two,
thirty-three or thirty-three-A of this chapter]. "RELATED MEMBER" MEANS
A RELATED PERSON AS DEFINED IN SUBPARAGRAPH (C) OF PARAGRAPH THREE OF
SUBSECTION (B) OF SECTION FOUR HUNDRED SIXTY-FIVE OF THE INTERNAL REVEN-
UE CODE, EXCEPT THAT "FIFTY PERCENT" SHALL BE SUBSTITUTED FOR "TEN
PERCENT".
S. 2609--B 22 A. 3009--B
(ii) [Controlling interest. A controlling interest shall mean (I) in
the case of a corporation, either thirty percent or more of the total
combined voting power of all classes of stock of such corporation, or
thirty percent or more of the capital, profits or beneficial interest in
such voting stock of such corporation, and (II) in the case of a part-
nership, association, trust or other entity, thirty percent or more of
the capital, profits or beneficial interest in such partnership, associ-
ation, trust or other entity.] EFFECTIVE RATE OF TAX. "EFFECTIVE RATE OF
TAX" MEANS, AS TO ANY STATE OR U.S. POSSESSION, THE MAXIMUM STATUTORY
RATE OF TAX IMPOSED BY THE STATE OR POSSESSION ON OR MEASURED BY A
RELATED MEMBER'S NET INCOME MULTIPLIED BY THE APPORTIONMENT PERCENTAGE,
IF ANY, APPLICABLE TO THE RELATED MEMBER UNDER THE LAWS OF SAID JURIS-
DICTION. FOR PURPOSES OF THIS DEFINITION, THE EFFECTIVE RATE OF TAX AS
TO ANY STATE OR U.S. POSSESSION IS ZERO WHERE THE RELATED MEMBER'S NET
INCOME TAX LIABILITY IN SAID JURISDICTION IS REPORTED ON A COMBINED OR
CONSOLIDATED RETURN INCLUDING BOTH THE TAXPAYER AND THE RELATED MEMBER
WHERE THE REPORTED TRANSACTIONS BETWEEN THE TAXPAYER AND THE RELATED
MEMBER ARE ELIMINATED OR OFFSET. ALSO, FOR PURPOSES OF THIS DEFINITION,
WHEN COMPUTING THE EFFECTIVE RATE OF TAX FOR A JURISDICTION IN WHICH A
RELATED MEMBER'S NET INCOME IS ELIMINATED OR OFFSET BY A CREDIT OR SIMI-
LAR ADJUSTMENT THAT IS DEPENDENT UPON THE RELATED MEMBER EITHER MAIN-
TAINING OR MANAGING INTANGIBLE PROPERTY OR COLLECTING INTEREST INCOME IN
THAT JURISDICTION, THE MAXIMUM STATUTORY RATE OF TAX IMPOSED BY SAID
JURISDICTION SHALL BE DECREASED TO REFLECT THE STATUTORY RATE OF TAX
THAT APPLIES TO THE RELATED MEMBER AS EFFECTIVELY REDUCED BY SUCH CREDIT
OR SIMILAR ADJUSTMENT.
(iii) Royalty payments. Royalty payments are payments directly
connected to the acquisition, use, maintenance or management, ownership,
sale, exchange, or any other disposition of licenses, trademarks, copy-
rights, trade names, trade dress, service marks, mask works, trade
secrets, patents and any other similar types of intangible assets as
determined by the commissioner, and [includes] INCLUDE amounts allowable
as interest deductions under section one hundred sixty-three of the
internal revenue code to the extent such amounts are directly or indi-
rectly for, related to or in connection with the acquisition, use, main-
tenance or management, ownership, sale, exchange or disposition of such
intangible assets.
(iv) Valid business purpose. A valid business purpose is one or more
business purposes other than the avoidance or reduction of taxation
which alone or in combination constitute the primary motivation for some
business activity or transaction, which activity or transaction changes
in a meaningful way, apart from tax effects, the economic position of
the taxpayer. The economic position of the taxpayer includes an increase
in the market share of the taxpayer, or the entry by the taxpayer into
new business markets.
(B) Royalty expense add backs. (i) For the purpose of computing New
York unrelated business taxable income, a taxpayer must add back royalty
payments [to a] DIRECTLY OR INDIRECTLY PAID, ACCRUED, OR INCURRED IN
CONNECTION WITH ONE OR MORE DIRECT OR INDIRECT TRANSACTIONS WITH ONE OR
MORE related [member] MEMBERS during the taxable year to the extent
deductible in calculating federal unrelated business taxable income;
(ii) [The add back of royalty payments shall not be required if and to
the extent that such payments meet either of the following conditions:
(I) the related member during the same taxable year directly or indi-
rectly paid or incurred the amount to a person or entity that is not a
S. 2609--B 23 A. 3009--B
related member, and such transaction was done for a valid business and
the payments are made at arm's length;
(II) the royalty payments are paid or incurred to a related member
organized under the laws of a country other than the United States, are
subject to a comprehensive income tax treaty between such country and
the United States, and are taxed in such country at a tax rate at least
equal to that imposed by this state.
(C) Royalty income exclusions. For the purpose of computing New York
unrelated business taxable income, a taxpayer shall be allowed to deduct
royalty payments directly or indirectly received from a related member
during the taxable year to the extent included in the taxpayer's federal
taxable income unless such royalty payments would not be required to be
added back under subparagraph (B) of this paragraph or other similar
provision in this chapter.] EXCEPTIONS. (I) THE ADJUSTMENT REQUIRED IN
THIS PARAGRAPH SHALL NOT APPLY TO THE PORTION OF THE ROYALTY PAYMENT
THAT THE TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE OF THE
TYPE AND IN THE FORM SPECIFIED BY THE COMMISSIONER, MEETS ALL OF THE
FOLLOWING REQUIREMENTS: (A) THE RELATED MEMBER WAS SUBJECT TO TAX IN
THIS STATE OR ANOTHER STATE OR POSSESSION OF THE UNITED STATES OR A
FOREIGN NATION OR SOME COMBINATION THEREOF ON A TAX BASE THAT INCLUDED
THE ROYALTY PAYMENT PAID, ACCRUED OR INCURRED BY THE TAXPAYER; (B) THE
RELATED MEMBER DURING THE SAME TAXABLE YEAR DIRECTLY OR INDIRECTLY PAID,
ACCRUED OR INCURRED SUCH PORTION TO A PERSON THAT IS NOT A RELATED
MEMBER; AND (C) THE TRANSACTION GIVING RISE TO THE ROYALTY PAYMENT
BETWEEN THE TAXPAYER AND THE RELATED MEMBER WAS UNDERTAKEN FOR A VALID
BUSINESS PURPOSE.
(II) THE ADJUSTMENT REQUIRED IN THIS PARAGRAPH SHALL NOT APPLY IF THE
TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE OF THE TYPE AND
IN THE FORM SPECIFIED BY THE COMMISSIONER, THAT: (A) THE RELATED MEMBER
WAS SUBJECT TO TAX ON OR MEASURED BY ITS NET INCOME IN THIS STATE OR
ANOTHER STATE OR POSSESSION OF THE UNITED STATES OR SOME COMBINATION
THEREOF; (B) THE TAX BASE FOR SAID TAX INCLUDED THE ROYALTY PAYMENT
PAID, ACCRUED OR INCURRED BY THE TAXPAYER; AND (C) THE AGGREGATE EFFEC-
TIVE RATE OF TAX APPLIED TO THE RELATED MEMBER IN THOSE JURISDICTIONS IS
NO LESS THAN EIGHTY PERCENT OF THE STATUTORY RATE OF TAX THAT APPLIED TO
THE TAXPAYER UNDER SECTION TWO HUNDRED NINETY OF THIS ARTICLE FOR THE
TAXABLE YEAR.
(III) THE ADJUSTMENT REQUIRED IN THIS PARAGRAPH SHALL NOT APPLY IF THE
TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE OF THE TYPE AND
IN THE FORM SPECIFIED BY THE COMMISSIONER, THAT: (A) THE ROYALTY PAYMENT
WAS PAID, ACCRUED OR INCURRED TO A RELATED MEMBER ORGANIZED UNDER THE
LAWS OF A COUNTRY OTHER THAN THE UNITED STATES; (B) THE RELATED MEMBER'S
INCOME FROM THE TRANSACTION WAS SUBJECT TO A COMPREHENSIVE INCOME TAX
TREATY BETWEEN SUCH COUNTRY AND THE UNITED STATES; (C) THE RELATED
MEMBER WAS SUBJECT TO TAX IN A FOREIGN NATION ON A TAX BASE THAT
INCLUDED THE ROYALTY PAYMENT PAID, ACCRUED OR INCURRED BY THE TAXPAYER;
(D) THE RELATED MEMBER'S INCOME FROM THE TRANSACTION WAS TAXED IN SUCH
COUNTRY AT AN EFFECTIVE RATE OF TAX AT LEAST EQUAL TO THAT IMPOSED BY
THIS STATE; AND (E) THE ROYALTY PAYMENT WAS PAID, ACCRUED OR INCURRED
PURSUANT TO A TRANSACTION THAT WAS UNDERTAKEN FOR A VALID BUSINESS
PURPOSE AND USING TERMS THAT REFLECT AN ARM'S LENGTH RELATIONSHIP.
(IV) THE ADJUSTMENT REQUIRED IN THIS PARAGRAPH SHALL NOT APPLY IF THE
TAXPAYER AND THE COMMISSIONER AGREE IN WRITING TO THE APPLICATION OR USE
OF ALTERNATIVE ADJUSTMENTS OR COMPUTATIONS. THE COMMISSIONER MAY, IN HIS
OR HER DISCRETION, AGREE TO THE APPLICATION OR USE OF ALTERNATIVE
ADJUSTMENTS OR COMPUTATIONS WHEN HE OR SHE CONCLUDES THAT IN THE ABSENCE
S. 2609--B 24 A. 3009--B
OF SUCH AGREEMENT THE INCOME OF THE TAXPAYER WOULD NOT BE PROPERLY
REFLECTED.
S 4. Paragraph 19 of subsection (c) of section 612 of the tax law is
REPEALED.
S 5. Subsection (r) of section 612 of the tax law, as amended by
section 3 of part M of chapter 686 of the laws of 2003, is amended to
read as follows:
(r) Related members expense add back [and income exclusion]. (1)
Definitions. (A) Related member [or members. For purposes of this
subsection, the term related member or members means a person, corpo-
ration, or other entity, including an entity that is treated as a part-
nership or other pass-through vehicle for purposes of federal taxation,
whether such person, corporation or entity is a taxpayer or not, where
one such person, corporation, or entity, or set of related persons,
corporations or entities, directly or indirectly owns or controls a
controlling interest in another entity. Such entity or entities may
include all taxpayers under article nine, nine-A, thirteen, twenty-two,
thirty-two, thirty-three or thirty-three-A of this chapter]. "RELATED
MEMBER" MEANS A RELATED PERSON AS DEFINED IN SUBPARAGRAPH (C) OF PARA-
GRAPH THREE OF SUBSECTION (B) OF SECTION FOUR HUNDRED SIXTY-FIVE OF THE
INTERNAL REVENUE CODE, EXCEPT THAT "FIFTY PERCENT" SHALL BE SUBSTITUTED
FOR "TEN PERCENT".
(B) [Controlling interest. A controlling interest shall mean (i) in
the case of a corporation, either thirty percent or more of the total
combined voting power of all classes of stock of such corporation, or
thirty percent or more of the capital, profits or beneficial interest in
such voting stock of such corporation, and (ii) in the case of a part-
nership, association, trust or other entity, thirty percent or more of
the capital, profits or beneficial interest in such partnership, associ-
ation, trust or other entity.] EFFECTIVE RATE OF TAX. "EFFECTIVE RATE
OF TAX" MEANS, AS TO ANY STATE OR U.S. POSSESSION, THE MAXIMUM STATUTORY
RATE OF TAX IMPOSED BY THE STATE OR POSSESSION ON OR MEASURED BY A
RELATED MEMBER'S NET INCOME MULTIPLIED BY THE APPORTIONMENT PERCENTAGE,
IF ANY, APPLICABLE TO THE RELATED MEMBER UNDER THE LAWS OF SAID JURIS-
DICTION. FOR PURPOSES OF THIS DEFINITION, THE EFFECTIVE RATE OF TAX AS
TO ANY STATE OR U.S. POSSESSION IS ZERO WHERE THE RELATED MEMBER'S NET
INCOME TAX LIABILITY IN SAID JURISDICTION IS REPORTED ON A COMBINED OR
CONSOLIDATED RETURN INCLUDING BOTH THE TAXPAYER AND THE RELATED MEMBER
WHERE THE REPORTED TRANSACTIONS BETWEEN THE TAXPAYER AND THE RELATED
MEMBER ARE ELIMINATED OR OFFSET. ALSO, FOR PURPOSES OF THIS DEFINITION,
WHEN COMPUTING THE EFFECTIVE RATE OF TAX FOR A JURISDICTION IN WHICH A
RELATED MEMBER'S NET INCOME IS ELIMINATED OR OFFSET BY A CREDIT OR SIMI-
LAR ADJUSTMENT THAT IS DEPENDENT UPON THE RELATED MEMBER EITHER MAIN-
TAINING OR MANAGING INTANGIBLE PROPERTY OR COLLECTING INTEREST INCOME IN
THAT JURISDICTION, THE MAXIMUM STATUTORY RATE OF TAX IMPOSED BY SAID
JURISDICTION SHALL BE DECREASED TO REFLECT THE STATUTORY RATE OF TAX
THAT APPLIES TO THE RELATED MEMBER AS EFFECTIVELY REDUCED BY SUCH CREDIT
OR SIMILAR ADJUSTMENT.
(C) Royalty payments. Royalty payments are payments directly connected
to the acquisition, use, maintenance or management, ownership, sale,
exchange, or any other disposition of licenses, trademarks, copyrights,
trade names, trade dress, service marks, mask works, trade secrets,
patents and any other similar types of intangible assets as determined
by the commissioner, and [includes] INCLUDE amounts allowable as inter-
est deductions under section one hundred sixty-three of the internal
revenue code to the extent such amounts are directly or indirectly for,
S. 2609--B 25 A. 3009--B
related to or in connection with the acquisition, use, maintenance or
management, ownership, sale, exchange or disposition of such intangible
assets.
(D) Valid business purpose. A valid business purpose is one or more
business purposes, other than the avoidance or reduction of taxation,
which alone or in combination constitute the primary motivation for some
business activity or transaction, which activity or transaction changes
in a meaningful way, apart from tax effects, the economic position of
the taxpayer. The economic position of the taxpayer includes an increase
in the market share of the taxpayer, or the entry by the taxpayer into
new business markets.
(2) Royalty expense add backs. (A) For the purpose of computing New
York adjusted gross income, a taxpayer must add back royalty payments
[to a] DIRECTLY OR INDIRECTLY PAID, ACCRUED, OR INCURRED IN CONNECTION
WITH ONE OR MORE DIRECT OR INDIRECT TRANSACTIONS WITH ONE OR MORE
related [member] MEMBERS during the taxable year to the extent deduct-
ible in calculating federal taxable income.
(B) [The add back of royalty payments shall not be required if and to
the extent that such payments meet either of the following conditions:
(i) the related member during the same taxable year directly or indi-
rectly paid or incurred the amount to a person or entity that is not a
related member, and such transaction was done for a valid business and
the payments are made at arm's length;
(ii) the royalty payments are paid or incurred to a related member
organized under the laws of a country other than the United States, are
subject to a comprehensive income tax treaty between such country and
the United States, and are taxed in such country at a tax rate at least
equal to that imposed by this state.
(3) Royalty income exclusions. For the purpose of computing New York
adjusted gross income, a taxpayer shall be allowed to deduct royalty
payments directly or indirectly received from a related member during
the taxable year to the extent included in the taxpayer's federal taxa-
ble income unless such royalty payments would not be required to be
added back under paragraph two of this subsection or other similar
provision in this chapter.] EXCEPTIONS. (I) THE ADJUSTMENT REQUIRED IN
THIS SUBSECTION SHALL NOT APPLY TO THE PORTION OF THE ROYALTY PAYMENT
THAT THE TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE OF THE
TYPE AND IN THE FORM SPECIFIED BY THE COMMISSIONER, MEETS ALL OF THE
FOLLOWING REQUIREMENTS: (I) THE RELATED MEMBER WAS SUBJECT TO TAX IN
THIS STATE OR ANOTHER STATE OR POSSESSION OF THE UNITED STATES OR A
FOREIGN NATION OR SOME COMBINATION THEREOF ON A TAX BASE THAT INCLUDED
THE ROYALTY PAYMENT PAID, ACCRUED OR INCURRED BY THE TAXPAYER; (II) THE
RELATED MEMBER DURING THE SAME TAXABLE YEAR DIRECTLY OR INDIRECTLY PAID,
ACCRUED OR INCURRED SUCH PORTION TO A PERSON THAT IS NOT A RELATED
MEMBER; AND (III) THE TRANSACTION GIVING RISE TO THE ROYALTY PAYMENT
BETWEEN THE TAXPAYER AND THE RELATED MEMBER WAS UNDERTAKEN FOR A VALID
BUSINESS PURPOSE.
(II) THE ADJUSTMENT REQUIRED IN THIS SUBSECTION SHALL NOT APPLY IF THE
TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE OF THE TYPE AND
IN THE FORM SPECIFIED BY THE COMMISSIONER, THAT: (I) THE RELATED MEMBER
WAS SUBJECT TO TAX ON OR MEASURED BY ITS NET INCOME IN THIS STATE OR
ANOTHER STATE OR POSSESSION OF THE UNITED STATES OR SOME COMBINATION
THEREOF; (II) THE TAX BASE FOR SAID TAX INCLUDED THE ROYALTY PAYMENT
PAID, ACCRUED OR INCURRED BY THE TAXPAYER; AND (III) THE AGGREGATE
EFFECTIVE RATE OF TAX APPLIED TO THE RELATED MEMBER IN THOSE JURISDIC-
TIONS IS NO LESS THAN EIGHTY PERCENT OF THE STATUTORY RATE OF TAX THAT
S. 2609--B 26 A. 3009--B
APPLIED TO THE TAXPAYER UNDER SECTION SIX HUNDRED ONE OF THIS ARTICLE
FOR THE TAXABLE YEAR.
(III) THE ADJUSTMENT REQUIRED IN THIS SUBSECTION SHALL NOT APPLY IF
THE TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE OF THE TYPE
AND IN THE FORM SPECIFIED BY THE COMMISSIONER, THAT: (I) THE ROYALTY
PAYMENT WAS PAID, ACCRUED OR INCURRED TO A RELATED MEMBER ORGANIZED
UNDER THE LAWS OF A COUNTRY OTHER THAN THE UNITED STATES; (II) THE
RELATED MEMBER'S INCOME FROM THE TRANSACTION WAS SUBJECT TO A COMPREHEN-
SIVE INCOME TAX TREATY BETWEEN SUCH COUNTRY AND THE UNITED STATES; (III)
THE RELATED MEMBER WAS SUBJECT TO TAX IN A FOREIGN NATION ON A TAX BASE
THAT INCLUDED THE ROYALTY PAYMENT PAID, ACCRUED OR INCURRED BY THE
TAXPAYER; (IV) THE RELATED MEMBER'S INCOME FROM THE TRANSACTION WAS
TAXED IN SUCH COUNTRY AT AN EFFECTIVE TAX RATE AT LEAST EQUAL TO THAT
IMPOSED BY THIS STATE; AND (V) THE ROYALTY PAYMENT WAS PAID, ACCRUED OR
INCURRED PURSUANT TO A TRANSACTION THAT WAS UNDERTAKEN FOR A VALID BUSI-
NESS PURPOSE AND USING TERMS THAT REFLECT AN ARM'S LENGTH RELATIONSHIP.
(IV) THE ADJUSTMENT REQUIRED IN THIS SUBSECTION SHALL NOT APPLY IF THE
TAXPAYER AND THE COMMISSIONER AGREE IN WRITING TO THE APPLICATION OR USE
OF ALTERNATIVE ADJUSTMENTS OR COMPUTATIONS. THE COMMISSIONER MAY, IN
HIS OR HER DISCRETION, AGREE TO THE APPLICATION OR USE OF ALTERNATIVE
ADJUSTMENTS OR COMPUTATIONS WHEN HE OR SHE CONCLUDES THAT IN THE ABSENCE
OF SUCH AGREEMENT THE INCOME OF THE TAXPAYER WOULD NOT BE PROPERLY
REFLECTED.
S 6. Paragraph 17 of subsection (e) of section 1453 of the tax law is
REPEALED.
S 7. Subsection (r) of section 1453 of the tax law, as amended by
section 5 of part M of chapter 686 of the laws of 2003, subparagraph (A)
of paragraph 2 as amended by section 5 of part J of chapter 60 of the
laws of 2007, is amended to read as follows:
(r) Related members expense add back [and income exclusion]. (1)
Definitions. (A) Related member [or members. For purposes of this
subsection, the term related member or members means a person, corpo-
ration, or other entity, including an entity that is treated as a part-
nership or other pass-through vehicle for purposes of federal taxation,
whether such person, corporation or entity is a taxpayer or not, where
one such person, corporation, or entity, or set of related persons,
corporations or entities, directly or indirectly owns or controls a
controlling interest in another entity. Such entity or entities may
include all taxpayers under article nine, nine-A, thirteen, twenty-two,
thirty-two, thirty-three or thirty-three-A of this chapter]. "RELATED
MEMBER" MEANS A RELATED PERSON AS DEFINED IN SUBPARAGRAPH (C) OF PARA-
GRAPH THREE OF SUBSECTION (B) OF SECTION FOUR HUNDRED SIXTY-FIVE OF THE
INTERNAL REVENUE CODE, EXCEPT THAT "FIFTY PERCENT" SHALL BE SUBSTITUTED
FOR "TEN PERCENT".
(B) [Controlling interest. A controlling interest shall mean (i) in
the case of a corporation, either thirty percent or more of the total
combined voting power of all classes of stock of such corporation, or
thirty percent or more of the capital, profits or beneficial interest in
such voting stock of such corporation, and (ii) in the case of a part-
nership, association, trust or other entity, thirty percent or more of
the capital, profits or beneficial interest in such partnership, associ-
ation, trust or other entity.] EFFECTIVE RATE OF TAX. "EFFECTIVE RATE OF
TAX" MEANS, AS TO ANY STATE OR U.S. POSSESSION, THE MAXIMUM STATUTORY
RATE OF TAX IMPOSED BY THE STATE OR POSSESSION ON OR MEASURED BY A
RELATED MEMBER'S NET INCOME MULTIPLIED BY THE APPORTIONMENT PERCENTAGE,
IF ANY, APPLICABLE TO THE RELATED MEMBER UNDER THE LAWS OF SAID JURIS-
S. 2609--B 27 A. 3009--B
DICTION. FOR PURPOSES OF THIS DEFINITION, THE EFFECTIVE RATE OF TAX AS
TO ANY STATE OR U.S. POSSESSION IS ZERO WHERE THE RELATED MEMBER'S NET
INCOME TAX LIABILITY IN SAID JURISDICTION IS REPORTED ON A COMBINED OR
CONSOLIDATED RETURN INCLUDING BOTH THE TAXPAYER AND THE RELATED MEMBER
WHERE THE REPORTED TRANSACTIONS BETWEEN THE TAXPAYER AND THE RELATED
MEMBER ARE ELIMINATED OR OFFSET. ALSO, FOR PURPOSES OF THIS DEFINITION,
WHEN COMPUTING THE EFFECTIVE RATE OF TAX FOR A JURISDICTION IN WHICH A
RELATED MEMBER'S NET INCOME IS ELIMINATED OR OFFSET BY A CREDIT OR SIMI-
LAR ADJUSTMENT THAT IS DEPENDENT UPON THE RELATED MEMBER EITHER MAIN-
TAINING OR MANAGING INTANGIBLE PROPERTY OR COLLECTING INTEREST INCOME IN
THAT JURISDICTION, THE MAXIMUM STATUTORY RATE OF TAX IMPOSED BY SAID
JURISDICTION SHALL BE DECREASED TO REFLECT THE STATUTORY RATE OF TAX
THAT APPLIES TO THE RELATED MEMBER AS EFFECTIVELY REDUCED BY SUCH CREDIT
OR SIMILAR ADJUSTMENT.
(C) Royalty payments. Royalty payments are payments directly connected
to the acquisition, use, maintenance or management, ownership, sale,
exchange, or any other disposition of licenses, trademarks, copyrights,
trade names, trade dress, service marks, mask works, trade secrets,
patents and any other similar types of intangible assets as determined
by the commissioner, and [includes] INCLUDE amounts allowable as inter-
est deductions under section one hundred sixty-three of the internal
revenue code to the extent such amounts are directly or indirectly for,
related to or in connection with the acquisition, use, maintenance or
management, ownership, sale, exchange or disposition of such intangible
assets.
(D) Valid business purpose. A valid business purpose is one or more
business purposes, other than the avoidance or reduction of taxation,
which alone or in combination constitute the primary motivation for some
business activity or transaction, which activity or transaction changes
in a meaningful way, apart from tax effects, the economic position of
the taxpayer. The economic position of the taxpayer includes an increase
in the market share of the taxpayer, or the entry by the taxpayer into
new business markets.
(2) Royalty expense add backs. (A) Except where a taxpayer is included
in a combined return with a related member pursuant to subsection (f) of
section fourteen hundred sixty-two of this article, for the purpose of
computing entire net income, a taxpayer must add back royalty payments
[to a] DIRECTLY OR INDIRECTLY PAID, ACCRUED, OR INCURRED IN CONNECTION
WITH ONE OR MORE DIRECT OR INDIRECT TRANSACTIONS WITH ONE OR MORE
related [member] MEMBERS during the taxable year to the extent deduct-
ible in calculating federal taxable income.
(B) [The add back of royalty payments shall not be required if and to
the extent that such payments meet either of the following conditions:
(i) the related member during the same taxable year directly or indi-
rectly paid or incurred the amount to a person or entity that is not a
related member, and such transaction was done for a valid business and
the payments are made at arm's length;
(ii) the royalty payments are paid or incurred to a related member
organized under the laws of a country other than the United States, are
subject to a comprehensive income tax treaty between such country and
the United States, and are taxed in such country at a tax rate at least
equal to that imposed by this state.
(3) Royalty income exclusions. For the purpose of computing entire net
income, a taxpayer shall be allowed to deduct royalty payments directly
or indirectly received from a related member during the taxable year to
the extent included in the taxpayer's federal taxable income unless such
S. 2609--B 28 A. 3009--B
royalty payments would not be required to be added back under paragraph
two of this subsection or other similar provision in this chapter.]
EXCEPTIONS. (I) THE ADJUSTMENT REQUIRED IN THIS SUBSECTION SHALL NOT
APPLY TO THE PORTION OF THE ROYALTY PAYMENT THAT THE TAXPAYER ESTAB-
LISHES, BY CLEAR AND CONVINCING EVIDENCE OF THE TYPE AND IN THE FORM
SPECIFIED BY THE COMMISSIONER, MEETS ALL OF THE FOLLOWING REQUIREMENTS:
(I) THE RELATED MEMBER WAS SUBJECT TO TAX IN THIS STATE OR ANOTHER STATE
OR POSSESSION OF THE UNITED STATES OR A FOREIGN NATION OR SOME COMBINA-
TION THEREOF ON A TAX BASE THAT INCLUDED THE ROYALTY PAYMENT PAID,
ACCRUED OR INCURRED BY THE TAXPAYER; (II) THE RELATED MEMBER DURING THE
SAME TAXABLE YEAR DIRECTLY OR INDIRECTLY PAID, ACCRUED OR INCURRED SUCH
PORTION TO A PERSON THAT IS NOT A RELATED MEMBER; AND (III) THE TRANS-
ACTION GIVING RISE TO THE ROYALTY PAYMENT BETWEEN THE TAXPAYER AND THE
RELATED MEMBER WAS UNDERTAKEN FOR A VALID BUSINESS PURPOSE.
(II) THE ADJUSTMENT REQUIRED IN THIS SUBSECTION SHALL NOT APPLY IF THE
TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE OF THE TYPE AND
IN THE FORM SPECIFIED BY THE COMMISSIONER, THAT: (I) THE RELATED MEMBER
WAS SUBJECT TO TAX ON OR MEASURED BY ITS NET INCOME IN THIS STATE OR
ANOTHER STATE OR POSSESSION OF THE UNITED STATES OR SOME COMBINATION
THEREOF; (II) THE TAX BASE FOR SAID TAX INCLUDED THE ROYALTY PAYMENT
PAID, ACCRUED OR INCURRED BY THE TAXPAYER; AND (III) THE AGGREGATE
EFFECTIVE RATE OF TAX APPLIED TO THE RELATED MEMBER IN THOSE JURISDIC-
TIONS IS NO LESS THAN EIGHTY PERCENT OF THE STATUTORY RATE OF TAX THAT
APPLIED TO THE TAXPAYER UNDER SECTION FOURTEEN HUNDRED FIFTY-FIVE OF
THIS ARTICLE FOR THE TAXABLE YEAR.
(III) THE ADJUSTMENT REQUIRED IN THIS SUBSECTION SHALL NOT APPLY IF
THE TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE OF THE TYPE
AND IN THE FORM SPECIFIED BY THE COMMISSIONER, THAT: (I) THE ROYALTY
PAYMENT WAS PAID, ACCRUED OR INCURRED TO A RELATED MEMBER ORGANIZED
UNDER THE LAWS OF A COUNTRY OTHER THAN THE UNITED STATES; (II) THE
RELATED MEMBER'S INCOME FROM THE TRANSACTION WAS SUBJECT TO A COMPREHEN-
SIVE INCOME TAX TREATY BETWEEN SUCH COUNTRY AND THE UNITED STATES; (III)
THE RELATED MEMBER WAS SUBJECT TO TAX IN A FOREIGN NATION ON A TAX BASE
THAT INCLUDED THE ROYALTY PAYMENT PAID, ACCRUED OR INCURRED BY THE
TAXPAYER; (IV) THE RELATED MEMBER'S INCOME FROM THE TRANSACTION WAS
TAXED IN SUCH COUNTRY AT AN EFFECTIVE RATE OF TAX AT LEAST EQUAL TO THAT
IMPOSED BY THIS STATE; AND (V) THE ROYALTY PAYMENT WAS PAID, ACCRUED OR
INCURRED PURSUANT TO A TRANSACTION THAT WAS UNDERTAKEN FOR A VALID BUSI-
NESS PURPOSE AND USING TERMS THAT REFLECT AN ARM'S LENGTH RELATIONSHIP.
(IV) THE ADJUSTMENT REQUIRED IN THIS SUBSECTION SHALL NOT APPLY IF THE
TAXPAYER AND THE COMMISSIONER AGREE IN WRITING TO THE APPLICATION OR USE
OF ALTERNATIVE ADJUSTMENTS OR COMPUTATIONS. THE COMMISSIONER MAY, IN HIS
OR HER DISCRETION, AGREE TO THE APPLICATION OR USE OF ALTERNATIVE
ADJUSTMENTS OR COMPUTATIONS WHEN HE OR SHE CONCLUDES THAT IN THE ABSENCE
OF SUCH AGREEMENT THE INCOME OF THE TAXPAYER WOULD NOT BE PROPERLY
REFLECTED.
S 8. Paragraph 14 of subdivision (b) of section 1503 of the tax law,
as amended by section 7 of part M of chapter 686 of the laws of 2003,
clause (i) of subparagraph (B) as amended by section 6 of part J of
chapter 60 of the laws of 2007, is amended to read as follows:
(14) Related members expense add back [and income exclusion]. (A)
Definitions. (i) Related member [or members. For purposes of this para-
graph, the term related member or members means a person, corporation,
or other entity, including an entity that is treated as a partnership or
other pass-through vehicle for purposes of federal taxation, whether
such person, corporation or entity is a taxpayer or not, where one such
S. 2609--B 29 A. 3009--B
person, corporation, or entity, or set of related persons, corporations
or entities, directly or indirectly owns or controls a controlling
interest in another entity. Such entity or entities may include all
taxpayers under article nine, nine-A, thirteen, twenty-two, thirty-two,
thirty-three or thirty-three-A of this chapter]. "RELATED MEMBER" MEANS
A RELATED PERSON AS DEFINED IN SUBPARAGRAPH (C) OF PARAGRAPH THREE OF
SUBSECTION (B) OF SECTION FOUR HUNDRED SIXTY-FIVE OF THE INTERNAL REVEN-
UE CODE, EXCEPT THAT "FIFTY PERCENT" SHALL BE SUBSTITUTED FOR "TEN
PERCENT".
(ii) [Controlling interest. A controlling interest shall mean (I) in
the case of a corporation, either thirty percent or more of the total
combined voting power of all classes of stock of such corporation, or
thirty percent or more of the capital, profits or beneficial interest in
such voting stock of such corporation, and (II) in the case of a part-
nership, association, trust or other entity, thirty percent or more of
the capital, profits or beneficial interest in such partnership, associ-
ation, trust or other entity.] EFFECTIVE RATE OF TAX. "EFFECTIVE RATE OF
TAX" MEANS, AS TO ANY STATE OR U.S. POSSESSION, THE MAXIMUM STATUTORY
RATE OF TAX IMPOSED BY THE STATE OR POSSESSION ON OR MEASURED BY A
RELATED MEMBER'S NET INCOME MULTIPLIED BY THE APPORTIONMENT PERCENTAGE,
IF ANY, APPLICABLE TO THE RELATED MEMBER UNDER THE LAWS OF SAID JURIS-
DICTION. FOR PURPOSES OF THIS DEFINITION, THE EFFECTIVE RATE OF TAX AS
TO ANY STATE OR U.S. POSSESSION IS ZERO WHERE THE RELATED MEMBER'S NET
INCOME TAX LIABILITY IN SAID JURISDICTION IS REPORTED ON A COMBINED OR
CONSOLIDATED RETURN INCLUDING BOTH THE TAXPAYER AND THE RELATED MEMBER
WHERE THE REPORTED TRANSACTIONS BETWEEN THE TAXPAYER AND THE RELATED
MEMBER ARE ELIMINATED OR OFFSET. ALSO, FOR PURPOSES OF THIS DEFINITION,
WHEN COMPUTING THE EFFECTIVE RATE OF TAX FOR A JURISDICTION IN WHICH A
RELATED MEMBER'S NET INCOME IS ELIMINATED OR OFFSET BY A CREDIT OR SIMI-
LAR ADJUSTMENT THAT IS DEPENDENT UPON THE RELATED MEMBER EITHER MAIN-
TAINING OR MANAGING INTANGIBLE PROPERTY OR COLLECTING INTEREST INCOME
IN THAT JURISDICTION, THE MAXIMUM STATUTORY RATE OF TAX IMPOSED BY SAID
JURISDICTION SHALL BE DECREASED TO REFLECT THE STATUTORY RATE OF TAX
THAT APPLIES TO THE RELATED MEMBER AS EFFECTIVELY REDUCED BY SUCH CREDIT
OR SIMILAR ADJUSTMENT.
(iii) Royalty payments. Royalty payments are payments directly
connected to the acquisition, use, maintenance or management, ownership,
sale, exchange, or any other disposition of licenses, trademarks, copy-
rights, trade names, trade dress, service marks, mask works, trade
secrets, patents and any other similar types of intangible assets as
determined by the commissioner, and [includes] INCLUDE amounts allowable
as interest deductions under section one hundred sixty-three of the
internal revenue code to the extent such amounts are directly or indi-
rectly for, related to or in connection with the acquisition, use, main-
tenance or management, ownership, sale, exchange or disposition of such
intangible assets.
(iv) Valid business purpose. A valid business purpose is one or more
business purposes, other than the avoidance or reduction of taxation,
which alone or in combination constitute the primary motivation for some
business activity or transaction, which activity or transaction changes
in a meaningful way, apart from tax effects, the economic position of
the taxpayer. The economic position of the taxpayer includes an increase
in the market share of the taxpayer, or the entry by the taxpayer into
new business markets.
(B) Royalty expense add backs. (i) Except where a taxpayer is included
in a combined return with a related member pursuant to subdivision (f)
S. 2609--B 30 A. 3009--B
of section fifteen hundred fifteen of this article, for the purpose of
computing entire net income, a taxpayer must add back royalty payments
[to a] DIRECTLY OR INDIRECTLY PAID, ACCRUED, OR INCURRED IN CONNECTION
WITH ONE OR MORE DIRECT OR INDIRECT TRANSACTIONS WITH ONE OR MORE
related [member] MEMBERS during the taxable year to the extent deduct-
ible in calculating federal taxable income.
(ii) [The add back of royalty payments shall not be required if and to
the extent that such payments meet either of the following conditions:
(I) the related member during the same taxable year directly or indi-
rectly paid or incurred the amount to a person or entity that is not a
related member, and such transaction was done for a valid business and
the payments are made at arm's length;
(II) the royalty payments are paid or incurred to a related member
organized under the laws of a country other than the United States, are
subject to a comprehensive income tax treaty between such country and
the United States, and are taxed in such country at a tax rate at least
equal to that imposed by this state.
(C) Royalty income exclusions. For the purpose of computing entire net
income, a taxpayer shall be allowed to deduct royalty payments directly
or indirectly received from a related member during the taxable year to
the extent included in the taxpayer's federal taxable income unless such
royalty payments would not be required to be added back under subpara-
graph (B) of this paragraph or other similar provision in this chapter.]
EXCEPTIONS. (I) THE ADJUSTMENT REQUIRED IN THIS PARAGRAPH SHALL NOT
APPLY TO THE PORTION OF THE ROYALTY PAYMENT THAT THE TAXPAYER ESTAB-
LISHES, BY CLEAR AND CONVINCING EVIDENCE OF THE TYPE AND IN THE FORM
SPECIFIED BY THE COMMISSIONER, MEETS ALL OF THE FOLLOWING REQUIREMENTS:
(A) THE RELATED MEMBER WAS SUBJECT TO TAX IN THIS STATE OR ANOTHER STATE
OR POSSESSION OF THE UNITED STATES OR A FOREIGN NATION OR SOME COMBINA-
TION THEREOF ON A TAX BASE THAT INCLUDED THE ROYALTY PAYMENT PAID,
ACCRUED OR INCURRED BY THE TAXPAYER; (B) THE RELATED MEMBER DURING THE
SAME TAXABLE YEAR DIRECTLY OR INDIRECTLY PAID, ACCRUED OR INCURRED SUCH
PORTION TO A PERSON THAT IS NOT A RELATED MEMBER; AND (C) THE TRANS-
ACTION GIVING RISE TO THE ROYALTY PAYMENT BETWEEN THE TAXPAYER AND THE
RELATED MEMBER WAS UNDERTAKEN FOR A VALID BUSINESS PURPOSE.
(II) THE ADJUSTMENT REQUIRED IN THIS PARAGRAPH SHALL NOT APPLY IF THE
TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE OF THE TYPE AND
IN THE FORM SPECIFIED BY THE COMMISSIONER, THAT: (A) THE RELATED MEMBER
WAS SUBJECT TO TAX ON OR MEASURED BY ITS NET INCOME IN THIS STATE OR
ANOTHER STATE OR POSSESSION OF THE UNITED STATES OR SOME COMBINATION
THEREOF; (B) THE TAX BASE FOR SAID TAX INCLUDED THE ROYALTY PAYMENT
PAID, ACCRUED OR INCURRED BY THE TAXPAYER; AND (C) THE AGGREGATE EFFEC-
TIVE RATE OF TAX APPLIED TO THE RELATED MEMBER IN THOSE JURISDICTIONS IS
NO LESS THAN EIGHTY PERCENT OF THE STATUTORY RATE OF TAX THAT APPLIED TO
THE TAXPAYER UNDER SECTION FIFTEEN HUNDRED TWO, FIFTEEN HUNDRED TWO-A,
OR FIFTEEN HUNDRED TWO-B OF THIS ARTICLE FOR THE TAXABLE YEAR.
(III) THE ADJUSTMENT REQUIRED IN THIS PARAGRAPH SHALL NOT APPLY IF THE
TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE OF THE TYPE AND
IN THE FORM SPECIFIED BY THE COMMISSIONER, THAT: (A) THE ROYALTY PAYMENT
WAS PAID, ACCRUED OR INCURRED TO A RELATED MEMBER ORGANIZED UNDER THE
LAWS OF A COUNTRY OTHER THAN THE UNITED STATES; (B) THE RELATED MEMBER'S
INCOME FROM THE TRANSACTION WAS SUBJECT TO A COMPREHENSIVE INCOME TAX
TREATY BETWEEN SUCH COUNTRY AND THE UNITED STATES; (C) THE RELATED
MEMBER WAS SUBJECT TO TAX IN A FOREIGN NATION ON A TAX BASE THAT
INCLUDED THE ROYALTY PAYMENT PAID, ACCRUED OR INCURRED BY THE TAXPAYER;
(D) THE RELATED MEMBER'S INCOME FROM THE TRANSACTION WAS TAXED IN SUCH
S. 2609--B 31 A. 3009--B
COUNTRY AT AN EFFECTIVE RATE OF TAX AT LEAST EQUAL TO THAT IMPOSED BY
THIS STATE; AND (E) THE ROYALTY PAYMENT WAS PAID, ACCRUED OR INCURRED
PURSUANT TO A TRANSACTION THAT WAS UNDERTAKEN FOR A VALID BUSINESS
PURPOSE AND USING TERMS THAT REFLECT AN ARM'S LENGTH RELATIONSHIP.
(IV) THE ADJUSTMENT REQUIRED IN THIS PARAGRAPH SHALL NOT APPLY IF THE
TAXPAYER AND THE COMMISSIONER AGREE IN WRITING TO THE APPLICATION OR USE
OF ALTERNATIVE ADJUSTMENTS OR COMPUTATIONS. THE COMMISSIONER MAY, IN HIS
OR HER DISCRETION, AGREE TO THE APPLICATION OR USE OF ALTERNATIVE
ADJUSTMENTS OR COMPUTATIONS WHEN HE OR SHE CONCLUDES THAT IN THE ABSENCE
OF SUCH AGREEMENT THE INCOME OF THE TAXPAYER WOULD NOT BE PROPERLY
REFLECTED.
S 9. Subdivision (e) of section 11-506 of the administrative code of
the city of New York, as added by section 17 of part M of chapter 686 of
the laws of 2003 and as relettered by chapter 633 of the laws of 2005,
is amended to read as follows:
(e) Related members expense add back [and income exclusion]. (1)
Definitions. (A) Related member [or members. For purposes of this subdi-
vision, the term related member or members means a person, corporation,
or other entity, including an entity that is treated as a partnership or
other pass-through vehicle for purposes of federal taxation, whether
such person, corporation or entity is a taxpayer or not, where one such
person, corporation, or entity, or set of related persons, corporations
or entities, directly or indirectly owns or controls a controlling
interest in another entity. Such entity or entities may include all
taxpayers under this title]. "RELATED MEMBER" MEANS A RELATED PERSON AS
DEFINED IN SUBPARAGRAPH (C) OF PARAGRAPH THREE OF SUBSECTION (B) OF
SECTION FOUR HUNDRED SIXTY-FIVE OF THE INTERNAL REVENUE CODE, EXCEPT
THAT "FIFTY PERCENT" SHALL BE SUBSTITUTED FOR "TEN PERCENT".
(B) [Controlling interest. A controlling interest shall mean (i) in
the case of a corporation, either thirty percent or more of the total
combined voting power of all classes of stock of such corporation, or
thirty percent or more of the capital, profits or beneficial interest in
such voting stock of such corporation, and (ii) in the case of a part-
nership, association, trust or other entity, thirty percent or more of
the capital, profits or beneficial interest in such partnership, associ-
ation, trust or other entity.] EFFECTIVE RATE OF TAX. "EFFECTIVE RATE OF
TAX" MEANS, AS TO ANY CITY, THE MAXIMUM STATUTORY RATE OF TAX IMPOSED BY
THE CITY ON OR MEASURED BY A RELATED MEMBER'S NET INCOME MULTIPLIED BY
THE APPORTIONMENT PERCENTAGE, IF ANY, APPLICABLE TO THE RELATED MEMBER
UNDER THE LAWS OF SAID JURISDICTION. FOR PURPOSES OF THIS DEFINITION,
THE EFFECTIVE RATE OF TAX AS TO ANY CITY IS ZERO WHERE THE RELATED
MEMBER'S NET INCOME TAX LIABILITY IN SAID CITY IS REPORTED ON A COMBINED
OR CONSOLIDATED RETURN INCLUDING BOTH THE TAXPAYER AND THE RELATED
MEMBER WHERE THE REPORTED TRANSACTIONS BETWEEN THE TAXPAYER AND THE
RELATED MEMBER ARE ELIMINATED OR OFFSET. ALSO, FOR PURPOSES OF THIS
DEFINITION, WHEN COMPUTING THE EFFECTIVE RATE OF TAX FOR A CITY IN WHICH
A RELATED MEMBER'S NET INCOME IS ELIMINATED OR OFFSET BY A CREDIT OR
SIMILAR ADJUSTMENT THAT IS DEPENDENT UPON THE RELATED MEMBER EITHER
MAINTAINING OR MANAGING INTANGIBLE PROPERTY OR COLLECTING INTEREST
INCOME IN THAT CITY, THE MAXIMUM STATUTORY RATE OF TAX IMPOSED BY SAID
CITY SHALL BE DECREASED TO REFLECT THE STATUTORY RATE OF TAX THAT
APPLIES TO THE RELATED MEMBER AS EFFECTIVELY REDUCED BY SUCH CREDIT OR
SIMILAR ADJUSTMENT.
(C) Royalty payments. Royalty payments are payments directly connected
to the acquisition, use, maintenance or management, ownership, sale,
exchange, or any other disposition of licenses, trademarks, copyrights,
S. 2609--B 32 A. 3009--B
trade names, trade dress, service marks, mask works, trade secrets,
patents and any other similar types of intangible assets as determined
by the commissioner of finance, and [includes] INCLUDE amounts allowable
as interest deductions under section one hundred sixty-three of the
internal revenue code to the extent such amounts are directly or indi-
rectly for, related to or in connection with the acquisition, use, main-
tenance or management, ownership, sale, exchange or disposition of such
intangible assets.
(D) Valid business purpose. A valid business purpose is one or more
business purposes, other than the avoidance or reduction of taxation,
which alone or in combination constitute the primary motivation for some
business activity or transaction, which activity or transaction changes
in a meaningful way, apart from tax effects, the economic position of
the taxpayer. The economic position of the taxpayer includes an increase
in the market share of the taxpayer, or the entry by the taxpayer into
new business markets.
(2) Royalty expense add backs. (A) For the purpose of computing unin-
corporated business entire net income, a taxpayer must add back royalty
payments [to a] DIRECTLY OR INDIRECTLY PAID, ACCRUED, OR INCURRED IN
CONNECTION WITH ONE OR MORE DIRECT OR INDIRECT TRANSACTIONS WITH ONE OR
MORE related [member] MEMBERS during the taxable year to the extent
deductible in calculating federal taxable income.
(B) [The add back of royalty payments shall not be required if and to
the extent that such payments meet either of the following conditions:
(i) the related member during the same taxable year directly or indi-
rectly paid or incurred the amount to a person or entity that is not a
related member, and such transaction was done for a valid business and
the payments are made at arm's length;
(ii) the royalty payments are paid or incurred to a related member
organized under the laws of a country other than the United States, are
subject to a comprehensive income tax treaty between such country and
the United States, and are taxed in such country at a tax rate at least
equal to that imposed by this state.
(3) Royalty income exclusions. For the purpose of computing unincorpo-
rated business entire net income, a taxpayer shall be allowed to deduct
royalty payments directly or indirectly received from a related member
during the taxable year to the extent included in the taxpayer's federal
taxable income unless such royalty payments would not be required to be
added back under paragraph two of this subdivision or other similar
provision in this chapter.] EXCEPTIONS. (I) THE ADJUSTMENT REQUIRED IN
THIS SUBDIVISION SHALL NOT APPLY TO THE PORTION OF THE ROYALTY PAYMENT
THAT THE TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE OF THE
TYPE AND IN THE FORM SPECIFIED BY THE COMMISSIONER OF FINANCE, MEETS ALL
OF THE FOLLOWING REQUIREMENTS: (I) THE RELATED MEMBER WAS SUBJECT TO TAX
IN THIS CITY OR ANOTHER CITY WITHIN THE UNITED STATES OR A FOREIGN
NATION OR SOME COMBINATION THEREOF ON A TAX BASE THAT INCLUDED THE
ROYALTY PAYMENT PAID, ACCRUED OR INCURRED BY THE TAXPAYER; (II) THE
RELATED MEMBER DURING THE SAME TAXABLE YEAR DIRECTLY OR INDIRECTLY PAID,
ACCRUED OR INCURRED SUCH PORTION TO A PERSON THAT IS NOT A RELATED
MEMBER; AND (III) THE TRANSACTION GIVING RISE TO THE ROYALTY PAYMENT
BETWEEN THE TAXPAYER AND THE RELATED MEMBER WAS UNDERTAKEN FOR A VALID
BUSINESS PURPOSE.
(II) THE ADJUSTMENT REQUIRED IN THIS SUBDIVISION SHALL NOT APPLY IF
THE TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE OF THE TYPE
AND IN THE FORM SPECIFIED BY THE COMMISSIONER OF FINANCE, THAT: (I) THE
RELATED MEMBER WAS SUBJECT TO TAX ON OR MEASURED BY ITS NET INCOME IN
S. 2609--B 33 A. 3009--B
THIS CITY OR ANOTHER CITY WITHIN THE UNITED STATES, OR SOME COMBINATION
THEREOF; (II) THE TAX BASE FOR SAID TAX INCLUDED THE ROYALTY PAYMENT
PAID, ACCRUED OR INCURRED BY THE TAXPAYER; AND (III) THE AGGREGATE
EFFECTIVE RATE OF TAX APPLIED TO THE RELATED MEMBER IN THOSE JURISDIC-
TIONS IS NO LESS THAN EIGHTY PERCENT OF THE STATUTORY RATE OF TAX THAT
APPLIED TO THE TAXPAYER UNDER SECTION 11-503 OF THIS CHAPTER FOR THE
TAXABLE YEAR.
(III) THE ADJUSTMENT REQUIRED IN THIS SUBDIVISION SHALL NOT APPLY IF
THE TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE OF THE TYPE
AND IN THE FORM SPECIFIED BY THE COMMISSIONER OF FINANCE, THAT: (I) THE
ROYALTY PAYMENT WAS PAID, ACCRUED OR INCURRED TO A RELATED MEMBER ORGAN-
IZED UNDER THE LAWS OF A COUNTRY OTHER THAN THE UNITED STATES; (II) THE
RELATED MEMBER'S INCOME FROM THE TRANSACTION WAS SUBJECT TO A COMPREHEN-
SIVE INCOME TAX TREATY BETWEEN SUCH COUNTRY AND THE UNITED STATES; (III)
THE RELATED MEMBER WAS SUBJECT TO TAX IN A FOREIGN NATION ON A TAX BASE
THAT INCLUDED THE ROYALTY PAYMENT PAID, ACCRUED OR INCURRED BY THE
TAXPAYER; (IV) THE RELATED MEMBER'S INCOME FROM THE TRANSACTION WAS
TAXED IN SUCH COUNTRY AT AN EFFECTIVE RATE OF TAX AT LEAST EQUAL TO THAT
IMPOSED BY THIS CITY; AND (V) THE ROYALTY PAYMENT WAS PAID, ACCRUED OR
INCURRED PURSUANT TO A TRANSACTION THAT WAS UNDERTAKEN FOR A VALID BUSI-
NESS PURPOSE AND USING TERMS THAT REFLECT AN ARM'S LENGTH RELATIONSHIP.
(IV) THE ADJUSTMENT REQUIRED IN THIS SUBDIVISION SHALL NOT APPLY IF
THE TAXPAYER AND THE COMMISSIONER OF FINANCE AGREE IN WRITING TO THE
APPLICATION OR USE OF ALTERNATIVE ADJUSTMENTS OR COMPUTATIONS. THE
COMMISSIONER OF FINANCE MAY, IN HIS OR HER DISCRETION, AGREE TO THE
APPLICATION OR USE OF ALTERNATIVE ADJUSTMENTS OR COMPUTATIONS WHEN HE OR
SHE CONCLUDES THAT IN THE ABSENCE OF SUCH AGREEMENT THE INCOME OF THE
TAXPAYER WOULD NOT BE PROPERLY REFLECTED.
S 10. Paragraph (n) of subdivision 8 of section 11-602 of the adminis-
trative code of the city of New York, as amended by section 19 of part M
of chapter 686 of the laws of 2003, is amended to read as follows:
(n) Related members expense add back [and income exclusion]. (1)
Definitions. (A) Related member [or members. For purposes of this para-
graph, the term related member or members means a person, corporation,
or other entity, including an entity that is treated as a partnership or
other pass-through vehicle for purposes of federal taxation, whether
such person, corporation or entity is a taxpayer or not, where one such
person, corporation, or entity, or set of related persons, corporations
or entities, directly or indirectly owns or controls a controlling
interest in another entity. Such entity or entities may include all
taxpayers under this title]. "RELATED MEMBER" MEANS A RELATED PERSON AS
DEFINED IN SUBPARAGRAPH (C) OF PARAGRAPH THREE OF SUBSECTION (B) OF
SECTION FOUR HUNDRED SIXTY-FIVE OF THE INTERNAL REVENUE CODE, EXCEPT
THAT "FIFTY PERCENT" SHALL BE SUBSTITUTED FOR "TEN PERCENT".
(B) [Controlling interest. A controlling interest shall mean (i) in
the case of a corporation, either thirty percent or more of the total
combined voting power of all classes of stock of such corporation, or
thirty percent or more of the capital, profits or beneficial interest in
such voting stock of such corporation, and (ii) in the case of a part-
nership, association, trust or other entity, thirty percent or more of
the capital, profits or beneficial interest in such partnership, associ-
ation, trust or other entity.] EFFECTIVE RATE OF TAX. "EFFECTIVE RATE OF
TAX" MEANS, AS TO ANY CITY, THE MAXIMUM STATUTORY RATE OF TAX IMPOSED BY
THE CITY ON OR MEASURED BY A RELATED MEMBER'S NET INCOME MULTIPLIED BY
THE APPORTIONMENT PERCENTAGE, IF ANY, APPLICABLE TO THE RELATED MEMBER
UNDER THE LAWS OF SAID JURISDICTION. FOR PURPOSES OF THIS DEFINITION,
S. 2609--B 34 A. 3009--B
THE EFFECTIVE RATE OF TAX AS TO ANY CITY IS ZERO WHERE THE RELATED
MEMBER'S NET INCOME TAX LIABILITY IN SAID CITY IS REPORTED ON A COMBINED
OR CONSOLIDATED RETURN INCLUDING BOTH THE TAXPAYER AND THE RELATED
MEMBER WHERE THE REPORTED TRANSACTIONS BETWEEN THE TAXPAYER AND THE
RELATED MEMBER ARE ELIMINATED OR OFFSET. ALSO, FOR PURPOSES OF THIS
DEFINITION, WHEN COMPUTING THE EFFECTIVE RATE OF TAX FOR A CITY IN WHICH
A RELATED MEMBER'S NET INCOME IS ELIMINATED OR OFFSET BY A CREDIT OR
SIMILAR ADJUSTMENT THAT IS DEPENDENT UPON THE RELATED MEMBER EITHER
MAINTAINING OR MANAGING INTANGIBLE PROPERTY OR COLLECTING INTEREST
INCOME IN THAT CITY, THE MAXIMUM STATUTORY RATE OF TAX IMPOSED BY SAID
CITY SHALL BE DECREASED TO REFLECT THE STATUTORY RATE OF TAX THAT
APPLIES TO THE RELATED MEMBER AS EFFECTIVELY REDUCED BY SUCH CREDIT OR
SIMILAR ADJUSTMENT.
(C) Royalty payments. Royalty payments are payments directly connected
to the acquisition, use, maintenance or management, ownership, sale,
exchange, or any other disposition of licenses, trademarks, copyrights,
trade names, trade dress, service marks, mask works, trade secrets,
patents and any other similar types of intangible assets as determined
by the commissioner of finance, and [includes] INCLUDE amounts allowable
as interest deductions under section one hundred sixty-three of the
internal revenue code to the extent such amounts are directly or indi-
rectly for, related to or in connection with the acquisition, use, main-
tenance or management, ownership, sale, exchange or disposition of such
intangible assets.
(D) Valid business purpose. A valid business purpose is one or more
business purposes, other than the avoidance or reduction of taxation,
which alone or in combination constitute the primary motivation for some
business activity or transaction, which activity or transaction changes
in a meaningful way, apart from tax effects, the economic position of
the taxpayer. The economic position of the taxpayer includes an increase
in the market share of the taxpayer, or the entry by the taxpayer into
new business markets.
(2) Royalty expense add backs. (A) For the purpose of computing entire
net income or other applicable taxable basis, a taxpayer must add back
royalty payments [to a] DIRECTLY OR INDIRECTLY PAID, ACCRUED, OR
INCURRED IN CONNECTION WITH ONE OR MORE DIRECT OR INDIRECT TRANSACTIONS
WITH ONE OR MORE related [member] MEMBERS during the taxable year to the
extent deductible in calculating federal taxable income.
(B) [The add back of royalty payments shall not be required if and to
the extent that such payments meet either of the following conditions:
(i) the related member during the same taxable year directly or indi-
rectly paid or incurred the amount to a person or entity that is not a
related member, and such transaction was done for a valid business
purpose and the payments are made at arm's length;
(ii) the royalty payments are paid or incurred to a related member
organized under the laws of a country other than the United States, are
subject to a comprehensive income tax treaty between such country and
the United States, and are taxed in such country at a tax rate at least
equal to that imposed by this state.
(3) Royalty income exclusions. For the purpose of computing entire net
income or other taxable basis, a taxpayer shall be allowed to deduct
royalty payments directly or indirectly received from a related member
during the taxable year to the extent included in the taxpayer's federal
taxable income unless such royalty payments would not be required to be
added back under subparagraph two of this paragraph or other similar
provision in this chapter.] EXCEPTIONS. (I) THE ADJUSTMENT REQUIRED IN
S. 2609--B 35 A. 3009--B
THIS PARAGRAPH SHALL NOT APPLY TO THE PORTION OF THE ROYALTY PAYMENT
THAT THE TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE OF THE
TYPE AND IN THE FORM SPECIFIED BY THE COMMISSIONER OF FINANCE, MEETS ALL
OF THE FOLLOWING REQUIREMENTS: (I) THE RELATED MEMBER WAS SUBJECT TO TAX
IN THIS CITY OR ANOTHER CITY WITHIN THE UNITED STATES OR A FOREIGN
NATION OR SOME COMBINATION THEREOF ON A TAX BASE THAT INCLUDED THE
ROYALTY PAYMENT PAID, ACCRUED OR INCURRED BY THE TAXPAYER; (II) THE
RELATED MEMBER DURING THE SAME TAXABLE YEAR DIRECTLY OR INDIRECTLY PAID,
ACCRUED OR INCURRED SUCH PORTION TO A PERSON THAT IS NOT A RELATED
MEMBER; AND (III) THE TRANSACTION GIVING RISE TO THE ROYALTY PAYMENT
BETWEEN THE TAXPAYER AND THE RELATED MEMBER WAS UNDERTAKEN FOR A VALID
BUSINESS PURPOSE.
(II) THE ADJUSTMENT REQUIRED IN THIS PARAGRAPH SHALL NOT APPLY IF THE
TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE OF THE TYPE AND
IN THE FORM SPECIFIED BY THE COMMISSIONER OF FINANCE, THAT: (I) THE
RELATED MEMBER WAS SUBJECT TO TAX ON OR MEASURED BY ITS NET INCOME IN
THIS CITY OR ANOTHER CITY WITHIN THE UNITED STATES, OR SOME COMBINATION
THEREOF; (II) THE TAX BASE FOR SAID TAX INCLUDED THE ROYALTY PAYMENT
PAID, ACCRUED OR INCURRED BY THE TAXPAYER; AND (III) THE AGGREGATE
EFFECTIVE RATE OF TAX APPLIED TO THE RELATED MEMBER IN THOSE JURISDIC-
TIONS IS NO LESS THAN EIGHTY PERCENT OF THE STATUTORY RATE OF TAX THAT
APPLIED TO THE TAXPAYER UNDER SECTION 11-604 OF THIS SUBCHAPTER FOR THE
TAXABLE YEAR.
(III) THE ADJUSTMENT REQUIRED IN THIS PARAGRAPH SHALL NOT APPLY IF THE
TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE OF THE TYPE AND
IN THE FORM SPECIFIED BY THE COMMISSIONER OF FINANCE, THAT: (I) THE
ROYALTY PAYMENT WAS PAID, ACCRUED OR INCURRED TO A RELATED MEMBER ORGAN-
IZED UNDER THE LAWS OF A COUNTRY OTHER THAN THE UNITED STATES; (II) THE
RELATED MEMBER'S INCOME FROM THE TRANSACTION WAS SUBJECT TO A COMPREHEN-
SIVE INCOME TAX TREATY BETWEEN SUCH COUNTRY AND THE UNITED STATES; (III)
THE RELATED MEMBER WAS SUBJECT TO TAX IN A FOREIGN NATION ON A TAX BASE
THAT INCLUDED THE ROYALTY PAYMENT PAID, ACCRUED OR INCURRED BY THE
TAXPAYER; (IV) THE RELATED MEMBER'S INCOME FROM THE TRANSACTION WAS
TAXED IN SUCH COUNTRY AT AN EFFECTIVE RATE OF TAX AT LEAST EQUAL TO THAT
IMPOSED BY THIS CITY; AND (V) THE ROYALTY PAYMENT WAS PAID, ACCRUED OR
INCURRED PURSUANT TO A TRANSACTION THAT WAS UNDERTAKEN FOR A VALID BUSI-
NESS PURPOSE AND USING TERMS THAT REFLECT AN ARM'S LENGTH RELATIONSHIP.
(IV) THE ADJUSTMENT REQUIRED IN THIS PARAGRAPH SHALL NOT APPLY IF THE
TAXPAYER AND THE COMMISSIONER OF FINANCE AGREE IN WRITING TO THE APPLI-
CATION OR USE OF ALTERNATIVE ADJUSTMENTS OR COMPUTATIONS. THE COMMIS-
SIONER OF FINANCE MAY, IN HIS OR HER DISCRETION, AGREE TO THE APPLICA-
TION OR USE OF ALTERNATIVE ADJUSTMENTS OR COMPUTATIONS WHEN HE OR SHE
CONCLUDES THAT IN THE ABSENCE OF SUCH AGREEMENT THE INCOME OF THE
TAXPAYER WOULD NOT BE PROPERLY REFLECTED.
S 11. Subdivision (q) of section 11-641 of the administrative code of
the city of New York, as added by section 21 of part M of chapter 686 of
the laws of 2003, is amended to read as follows:
(q) Related members expense add back [and income exclusion]. (1)
Definitions. (A) Related member [or members. For purposes of this subdi-
vision, the term related member or members means a person, corporation,
or other entity, including an entity that is treated as a partnership or
other pass-through vehicle for purposes of federal taxation, whether
such person, corporation or entity is a taxpayer or not, where one such
person, corporation, or entity, or set of related persons, corporations
or entities, directly or indirectly owns or controls a controlling
interest in another entity. Such entity or entities may include all
S. 2609--B 36 A. 3009--B
taxpayers under this title]. "RELATED MEMBER" MEANS A RELATED PERSON AS
DEFINED IN SUBPARAGRAPH (C) OF PARAGRAPH THREE OF SUBSECTION (B) OF
SECTION FOUR HUNDRED SIXTY-FIVE OF THE INTERNAL REVENUE CODE, EXCEPT
THAT "FIFTY PERCENT" SHALL BE SUBSTITUTED FOR "TEN PERCENT".
(B) [Controlling interest. A controlling interest shall mean (i) in
the case of a corporation, either thirty percent or more of the total
combined voting power of all classes of stock of such corporation, or
thirty percent or more of the capital, profits or beneficial interest in
such voting stock of such corporation, and (ii) in the case of a part-
nership, association, trust or other entity, thirty percent or more of
the capital, profits or beneficial interest in such partnership, associ-
ation, trust or other entity.] EFFECTIVE RATE OF TAX. "EFFECTIVE RATE
OF TAX" MEANS, AS TO ANY CITY, THE MAXIMUM STATUTORY RATE OF TAX IMPOSED
BY THE CITY ON OR MEASURED BY A RELATED MEMBER'S NET INCOME MULTIPLIED
BY THE APPORTIONMENT PERCENTAGE, IF ANY, APPLICABLE TO THE RELATED
MEMBER UNDER THE LAWS OF SAID JURISDICTION. FOR PURPOSES OF THIS DEFI-
NITION, THE EFFECTIVE RATE OF TAX AS TO ANY CITY IS ZERO WHERE THE
RELATED MEMBER'S NET INCOME TAX LIABILITY IN SAID CITY IS REPORTED ON A
COMBINED OR CONSOLIDATED RETURN INCLUDING BOTH THE TAXPAYER AND THE
RELATED MEMBER WHERE THE REPORTED TRANSACTIONS BETWEEN THE TAXPAYER AND
THE RELATED MEMBER ARE ELIMINATED OR OFFSET. ALSO, FOR PURPOSES OF THIS
DEFINITION, WHEN COMPUTING THE EFFECTIVE RATE OF TAX FOR A CITY IN WHICH
A RELATED MEMBER'S NET INCOME IS ELIMINATED OR OFFSET BY A CREDIT OR
SIMILAR ADJUSTMENT THAT IS DEPENDENT UPON THE RELATED MEMBER EITHER
MAINTAINING OR MANAGING INTANGIBLE PROPERTY OR COLLECTING INTEREST
INCOME IN THAT CITY, THE MAXIMUM STATUTORY RATE OF TAX IMPOSED BY SAID
CITY SHALL BE DECREASED TO REFLECT THE STATUTORY RATE OF TAX THAT
APPLIES TO THE RELATED MEMBER AS EFFECTIVELY REDUCED BY SUCH CREDIT OR
SIMILAR ADJUSTMENT.
(C) Royalty payments. Royalty payments are payments directly connected
to the acquisition, use, maintenance or management, ownership, sale,
exchange, or any other disposition of licenses, trademarks, copyrights,
trade names, trade dress, service marks, mask works, trade secrets,
patents and any other similar types of intangible assets as determined
by the commissioner of finance, and [includes] INCLUDE amounts allowable
as interest deductions under section one hundred sixty-three of the
internal revenue code to the extent such amounts are directly or indi-
rectly for, related to or in connection with the acquisition, use, main-
tenance or management, ownership, sale, exchange or disposition of such
intangible assets.
(D) Valid business purpose. A valid business purpose is one or more
business purposes, other than the avoidance or reduction of taxation,
which alone or in combination constitute the primary motivation for some
business activity or transaction, which activity or transaction changes
in a meaningful way, apart from tax effects, the economic position of
the taxpayer. The economic position of the taxpayer includes an increase
in the market share of the taxpayer, or the entry by the taxpayer into
new business markets.
(2) Royalty expense add backs. (A) For the purpose of computing entire
net income, a taxpayer must add back royalty payments [to a] DIRECTLY OR
INDIRECTLY PAID, ACCRUED, OR INCURRED IN CONNECTION WITH ONE OR MORE
DIRECT OR INDIRECT TRANSACTIONS WITH ONE OR MORE related [member]
MEMBERS during the taxable year to the extent deductible in calculating
federal taxable income.
(B) [The add back of royalty payments shall not be required if and to
the extent that such payments meet either of the following conditions:
S. 2609--B 37 A. 3009--B
(i) the related member during the same taxable year directly or indi-
rectly paid or incurred the amount to a person or entity that is not a
related member, and such transaction was done for a valid business and
the payments are made at arm's length;
(ii) the royalty payments are paid or incurred to a related member
organized under the laws of a country other than the United States, are
subject to a comprehensive income tax treaty between such country and
the United States, and are taxed in such country at a tax rate at least
equal to that imposed by this state.
(3) Royalty income exclusions. For the purpose of computing entire net
income, a taxpayer shall be allowed to deduct royalty payments directly
or indirectly received from a related member during the taxable year to
the extent included in the taxpayer's federal taxable income unless such
royalty payments would not be required to be added back under paragraph
two of this subdivision or other similar provision in this chapter.]
EXCEPTIONS. (I) THE ADJUSTMENT REQUIRED IN THIS SUBDIVISION SHALL NOT
APPLY TO THE PORTION OF THE ROYALTY PAYMENT THAT THE TAXPAYER ESTAB-
LISHES, BY CLEAR AND CONVINCING EVIDENCE OF THE TYPE AND IN THE FORM
SPECIFIED BY THE COMMISSIONER OF FINANCE, MEETS ALL OF THE FOLLOWING
REQUIREMENTS: (I) THE RELATED MEMBER WAS SUBJECT TO TAX IN THIS CITY OR
ANOTHER CITY WITHIN THE UNITED STATES OR A FOREIGN NATION OR SOME COMBI-
NATION THEREOF ON A TAX BASE THAT INCLUDED THE ROYALTY PAYMENT PAID,
ACCRUED OR INCURRED BY THE TAXPAYER; (II) THE RELATED MEMBER DURING THE
SAME TAXABLE YEAR DIRECTLY OR INDIRECTLY PAID, ACCRUED OR INCURRED SUCH
PORTION TO A PERSON THAT IS NOT A RELATED MEMBER; AND (III) THE TRANS-
ACTION GIVING RISE TO THE ROYALTY PAYMENT BETWEEN THE TAXPAYER AND THE
RELATED MEMBER WAS UNDERTAKEN FOR A VALID BUSINESS PURPOSE.
(II) THE ADJUSTMENT REQUIRED IN THIS SUBDIVISION SHALL NOT APPLY IF
THE TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE OF THE TYPE
AND IN THE FORM SPECIFIED BY THE COMMISSIONER OF FINANCE, THAT: (I) THE
RELATED MEMBER WAS SUBJECT TO TAX ON OR MEASURED BY ITS NET INCOME IN
THIS CITY OR ANOTHER CITY WITHIN THE UNITED STATES, OR SOME COMBINATION
THEREOF; (II) THE TAX BASE FOR SAID TAX INCLUDED THE ROYALTY PAYMENT
PAID, ACCRUED OR INCURRED BY THE TAXPAYER; AND (III) THE AGGREGATE
EFFECTIVE RATE OF TAX APPLIED TO THE RELATED MEMBER IN THOSE JURISDIC-
TIONS IS NO LESS THAN EIGHTY PERCENT OF THE STATUTORY RATE OF TAX THAT
APPLIED TO THE TAXPAYER UNDER SECTION 11-643.5 OF THIS PART FOR THE
TAXABLE YEAR.
(III) THE ADJUSTMENT REQUIRED IN THIS SUBDIVISION SHALL NOT APPLY IF
THE TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE OF THE TYPE
AND IN THE FORM SPECIFIED BY THE COMMISSIONER OF FINANCE, THAT: (I) THE
ROYALTY PAYMENT WAS PAID, ACCRUED OR INCURRED TO A RELATED MEMBER ORGAN-
IZED UNDER THE LAWS OF A COUNTRY OTHER THAN THE UNITED STATES; (II) THE
RELATED MEMBER'S INCOME FROM THE TRANSACTION WAS SUBJECT TO A COMPREHEN-
SIVE INCOME TAX TREATY BETWEEN SUCH COUNTRY AND THE UNITED STATES; (III)
THE RELATED MEMBER WAS SUBJECT TO TAX IN A FOREIGN NATION ON A TAX BASE
THAT INCLUDED THE ROYALTY PAYMENT PAID, ACCRUED OR INCURRED BY THE
TAXPAYER; (IV) THE RELATED MEMBER'S INCOME FROM THE TRANSACTION WAS
TAXED IN SUCH COUNTRY AT AN EFFECTIVE RATE OF TAX AT LEAST EQUAL TO THAT
IMPOSED BY THIS CITY; AND (V) THE ROYALTY PAYMENT WAS PAID, ACCRUED OR
INCURRED PURSUANT TO A TRANSACTION THAT WAS UNDERTAKEN FOR A VALID BUSI-
NESS PURPOSE AND USING TERMS THAT REFLECT AN ARM'S LENGTH RELATIONSHIP.
(IV) THE ADJUSTMENT REQUIRED IN THIS SUBDIVISION SHALL NOT APPLY IF
THE TAXPAYER AND THE COMMISSIONER OF FINANCE AGREE IN WRITING TO THE
APPLICATION OR USE OF ALTERNATIVE ADJUSTMENTS OR COMPUTATIONS. THE
COMMISSIONER OF FINANCE MAY, IN HIS OR HER DISCRETION, AGREE TO THE
S. 2609--B 38 A. 3009--B
APPLICATION OR USE OF ALTERNATIVE ADJUSTMENTS OR COMPUTATIONS WHEN HE OR
SHE CONCLUDES THAT IN THE ABSENCE OF SUCH AGREEMENT THE INCOME OF THE
TAXPAYER WOULD NOT BE PROPERLY REFLECTED.
S 12. Subdivision (t) of section 11-1712 of the administrative code of
the city of New York, as added by section 26 of part M of chapter 686 of
the laws of 2003, is amended to read as follows:
(t) Related members expense add back [and income exclusion]. (1)
Definitions. (A) Related member [or members. For purposes of this subdi-
vision, the term related member or members means a person, corporation,
or other entity, including an entity that is treated as a partnership or
other pass-through vehicle for purposes of federal taxation, whether
such person, corporation or entity is a taxpayer or not, where one such
person, corporation or entity, or set of related persons, corporations
or entities, directly or indirectly owns or controls a controlling
interest in another entity. Such entity or entities may include all
taxpayers under this title]. "RELATED MEMBER" MEANS A RELATED PERSON AS
DEFINED IN SUBPARAGRAPH (C) OF PARAGRAPH THREE OF SUBSECTION (B) OF
SECTION FOUR HUNDRED SIXTY-FIVE OF THE INTERNAL REVENUE CODE, EXCEPT
THAT "FIFTY PERCENT" SHALL BE SUBSTITUTED FOR "TEN PERCENT".
(B) [Controlling interest. A controlling interest shall mean (i) in
the case of a corporation, either thirty percent or more of the total
combined voting power of all classes of stock of such corporation, or
thirty percent or more of the capital, profits or beneficial interest in
such voting stock of such corporation, and (ii) in the case of a part-
nership, association, trust or other entity, thirty percent or more of
the capital, profits or beneficial interest in such partnership, associ-
ation, trust or other entity.] EFFECTIVE RATE OF TAX. "EFFECTIVE RATE OF
TAX" MEANS, AS TO ANY CITY, THE MAXIMUM STATUTORY RATE OF TAX IMPOSED BY
THE CITY ON OR MEASURED BY A RELATED MEMBER'S NET INCOME MULTIPLIED BY
THE APPORTIONMENT PERCENTAGE, IF ANY, APPLICABLE TO THE RELATED MEMBER
UNDER THE LAWS OF SAID JURISDICTION. FOR PURPOSES OF THIS DEFINITION,
THE EFFECTIVE RATE OF TAX AS TO ANY CITY IS ZERO WHERE THE RELATED
MEMBER'S NET INCOME TAX LIABILITY IN SAID CITY IS REPORTED ON A COMBINED
OR CONSOLIDATED RETURN INCLUDING BOTH THE TAXPAYER AND THE RELATED
MEMBER WHERE THE REPORTED TRANSACTIONS BETWEEN THE TAXPAYER AND THE
RELATED MEMBER ARE ELIMINATED OR OFFSET. ALSO, FOR PURPOSES OF THIS
DEFINITION, WHEN COMPUTING THE EFFECTIVE RATE OF TAX FOR A CITY IN WHICH
A RELATED MEMBER'S NET INCOME IS ELIMINATED OR OFFSET BY A CREDIT OR
SIMILAR ADJUSTMENT THAT IS DEPENDENT UPON THE RELATED MEMBER EITHER
MAINTAINING OR MANAGING INTANGIBLE PROPERTY OR COLLECTING INTEREST
INCOME IN THAT CITY, THE MAXIMUM STATUTORY RATE OF TAX IMPOSED BY SAID
CITY SHALL BE DECREASED TO REFLECT THE STATUTORY RATE OF TAX THAT
APPLIES TO THE RELATED MEMBER AS EFFECTIVELY REDUCED BY SUCH CREDIT OR
SIMILAR ADJUSTMENT.
(C) Royalty payments. Royalty payments are payments directly connected
to the acquisition, use, maintenance or management, ownership, sale,
exchange, or any other disposition of licenses, trademarks, copyrights,
trade names, trade dress, service marks, mask works, trade secrets,
patents and any other similar types of intangible assets as determined
by the state commissioner of taxation and finance, and [includes]
INCLUDE amounts allowable as interest deductions under section one
hundred sixty-three of the internal revenue code to the extent such
amounts are directly or indirectly for, related to or in connection with
the acquisition, use, maintenance or management, ownership, sale,
exchange or disposition of such intangible assets.
S. 2609--B 39 A. 3009--B
(D) Valid business purpose. A valid business purpose is one or more
business purposes, other than the avoidance or reduction of taxation,
which alone or in combination constitute the primary motivation for some
business activity or transaction, which activity or transaction changes
in a meaningful way, apart from tax effects, the economic position of
the taxpayer. The economic position of the taxpayer includes an increase
in the market share of the taxpayer, or the entry by the taxpayer into
new business markets.
(2) Royalty expense add backs. (A) For the purpose of computing city
adjusted gross income, a taxpayer must add back royalty payments [to a]
DIRECTLY OR INDIRECTLY PAID, ACCRUED, OR INCURRED IN CONNECTION WITH ONE
OR MORE DIRECT OR INDIRECT TRANSACTIONS WITH ONE OR MORE related
[member] MEMBERS during the taxable year to the extent deductible in
calculating federal taxable income.
(B) [The add back of royalty payments shall not be required if and to
the extent that such payments meet either of the following conditions:
(i) the related member during the same taxable year directly or indi-
rectly paid or incurred the amount to a person or entity that is not a
related member, and such transaction was done for a valid business and
the payments are made at arm's length;
(ii) the royalty payments are paid or incurred to a related member
organized under the laws of a country other than the United States, are
subject to a comprehensive income tax treaty between such country and
the United States, and are taxed in such country at a tax rate at least
equal to that imposed by this state.
(3) Royalty income exclusions. (A) For the purpose of computing city
adjusted gross income, a taxpayer shall be allowed to deduct royalty
payments directly or indirectly received from a related member during
the taxable year to the extent included in the taxpayer's federal taxa-
ble income unless such royalty payments would not be required to be
added back under paragraph two of this subdivision or other similar
provision in this title.] EXCEPTIONS. (I) THE ADJUSTMENT REQUIRED IN
THIS SUBDIVISION SHALL NOT APPLY TO THE PORTION OF THE ROYALTY PAYMENT
THAT THE TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE OF THE
TYPE AND IN THE FORM SPECIFIED BY THE COMMISSIONER OF FINANCE, MEETS ALL
OF THE FOLLOWING REQUIREMENTS: (I) THE RELATED MEMBER WAS SUBJECT TO TAX
IN THIS CITY OR ANOTHER CITY WITHIN THE UNITED STATES OR A FOREIGN
NATION OR SOME COMBINATION THEREOF ON A TAX BASE THAT INCLUDED THE
ROYALTY PAYMENT PAID, ACCRUED OR INCURRED BY THE TAXPAYER; (II) THE
RELATED MEMBER DURING THE SAME TAXABLE YEAR DIRECTLY OR INDIRECTLY PAID,
ACCRUED OR INCURRED SUCH PORTION TO A PERSON THAT IS NOT A RELATED
MEMBER; AND (III) THE TRANSACTION GIVING RISE TO THE ROYALTY PAYMENT
BETWEEN THE TAXPAYER AND THE RELATED MEMBER WAS UNDERTAKEN FOR A VALID
BUSINESS PURPOSE.
(II) THE ADJUSTMENT REQUIRED IN THIS SUBDIVISION SHALL NOT APPLY IF
THE TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE OF THE TYPE
AND IN THE FORM SPECIFIED BY THE COMMISSIONER OF FINANCE, THAT: (I) THE
RELATED MEMBER WAS SUBJECT TO TAX ON OR MEASURED BY ITS NET INCOME IN
THIS CITY OR ANOTHER CITY WITHIN THE UNITED STATES, OR SOME COMBINATION
THEREOF; (II) THE TAX BASE FOR SAID TAX INCLUDED THE ROYALTY PAYMENT
PAID, ACCRUED OR INCURRED BY THE TAXPAYER; AND (III) THE AGGREGATE
EFFECTIVE RATE OF TAX APPLIED TO THE RELATED MEMBER IN THOSE JURISDIC-
TIONS IS NO LESS THAN EIGHTY PERCENT OF THE STATUTORY RATE OF TAX THAT
APPLIED TO THE TAXPAYER UNDER SECTION 11-1701 OF THIS CHAPTER FOR THE
TAXABLE YEAR.
S. 2609--B 40 A. 3009--B
(III) THE ADJUSTMENT REQUIRED IN THIS SUBDIVISION SHALL NOT APPLY IF
THE TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE OF THE TYPE
AND IN THE FORM SPECIFIED BY THE COMMISSIONER OF FINANCE, THAT: (I) THE
ROYALTY PAYMENT WAS PAID, ACCRUED OR INCURRED TO A RELATED MEMBER ORGAN-
IZED UNDER THE LAWS OF A COUNTRY OTHER THAN THE UNITED STATES; (II) THE
RELATED MEMBER'S INCOME FROM THE TRANSACTION WAS SUBJECT TO A COMPREHEN-
SIVE INCOME TAX TREATY BETWEEN SUCH COUNTRY AND THE UNITED STATES; (III)
THE RELATED MEMBER WAS SUBJECT TO TAX IN A FOREIGN NATION ON A TAX BASE
THAT INCLUDED THE ROYALTY PAYMENT PAID, ACCRUED OR INCURRED BY THE
TAXPAYER; (IV) THE RELATED MEMBER'S INCOME FROM THE TRANSACTION WAS
TAXED IN SUCH COUNTRY AT AN EFFECTIVE RATE OF TAX AT LEAST EQUAL TO THAT
IMPOSED BY THIS CITY; AND (V) THE ROYALTY PAYMENT WAS PAID, ACCRUED OR
INCURRED PURSUANT TO A TRANSACTION THAT WAS UNDERTAKEN FOR A VALID BUSI-
NESS PURPOSE AND USING TERMS THAT REFLECT AN ARM'S LENGTH RELATIONSHIP.
(IV) THE ADJUSTMENT REQUIRED IN THIS SUBDIVISION SHALL NOT APPLY IF
THE TAXPAYER AND THE COMMISSIONER OF FINANCE AGREE IN WRITING TO THE
APPLICATION OR USE OF ALTERNATIVE ADJUSTMENTS OR COMPUTATIONS. THE
COMMISSIONER OF FINANCE MAY, IN HIS OR HER DISCRETION, AGREE TO THE
APPLICATION OR USE OF ALTERNATIVE ADJUSTMENTS OR COMPUTATIONS WHEN HE OR
SHE CONCLUDES THAT IN THE ABSENCE OF SUCH AGREEMENT THE INCOME OF THE
TAXPAYER WOULD NOT BE PROPERLY REFLECTED.
S 13. This act shall take effect immediately and shall apply to taxa-
ble years beginning on or after January 1, 2013.
PART F
Section 1. Subparagraph (A) of paragraph 1, and paragraphs 4 and 5 of
subsection (oo) of section 606 of the tax law, subparagraph (A) of para-
graph 1 as amended by chapter 472 of the laws of 2010 and paragraph 4 as
amended and paragraph 5 as added by chapter 239 of the laws of 2009, are
amended to read as follows:
(A) For taxable years beginning on or after January first, two thou-
sand ten and before January first, two thousand [fifteen] TWENTY, a
taxpayer shall be allowed a credit as hereinafter provided, against the
tax imposed by this article, in an amount equal to one hundred percent
of the amount of credit allowed the taxpayer with respect to a certified
historic structure under subsection (a) (2) of section 47 of the federal
internal revenue code with respect to a certified historic structure
located within the state. Provided, however, the credit shall not exceed
five million dollars. For taxable years beginning on or after January
first, two thousand [fifteen] TWENTY, a taxpayer shall be allowed a
credit as hereinafter provided, against the tax imposed by this article,
in an amount equal to thirty percent of the amount of credit allowed the
taxpayer with respect to a certified historic structure under subsection
(a)(2) of section 47 of the federal internal revenue code with respect
to a certified historic structure located within the state; provided,
however, the credit shall not exceed one hundred thousand dollars.
(4) If the amount of the credit [allowable under this subsection for
any taxable year shall exceed the taxpayer's tax for such year, the
excess may be carried over to the following year or years, and may be
applied against the taxpayer's tax for such year or years] 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. 2609--B 41 A. 3009--B
(5) To be eligible for the credit allowable under this subsection the
rehabilitation project shall be in whole or in part [a targeted area
residence within the meaning of section 143(j) of the internal revenue
code or] located within a census tract which is identified as being at
or below one hundred percent of the state median family income [in the
most recent federal census] AS CALCULATED USING A FIVE YEAR SAMPLE FROM
THE AMERICAN COMMUNITY SURVEY BEGINNING WITH THE YEAR TWO THOUSAND SIX-
-YEAR TWO THOUSAND ELEVEN SAMPLE.
S 2. Subparagraph (A) of paragraph 1, and paragraphs 4 and 5 of subdi-
vision 40 of section 210 of the tax law, subparagraph (A) of paragraph 1
and paragraph 4 as amended and paragraph 5 as added by chapter 472 of
the laws of 2010, are amended to read as follows:
(A) For taxable years beginning on or after January first, two thou-
sand ten and before January first, two thousand [fifteen] TWENTY, a
taxpayer shall be allowed a credit as hereinafter provided, against the
tax imposed by this article, in an amount equal to one hundred percent
of the amount of credit allowed the taxpayer with respect to a certified
historic structure under subsection (a) (2) of section 47 of the federal
internal revenue code with respect to a certified historic structure
located within the state. Provided, however, the credit shall not exceed
five million dollars. For taxable years beginning on or after January
first, two thousand [fifteen] TWENTY, a taxpayer shall be allowed a
credit as hereinafter provided, against the tax imposed by this article,
in an amount equal to thirty percent of the amount of credit allowed the
taxpayer with respect to a certified historic structure under subsection
(a)(2) of section 47 of the federal internal revenue code with respect
to a certified historic structure located within the state. Provided,
however, the credit shall not exceed one hundred thousand dollars.
(4) The credit allowed under this subdivision for any taxable year
shall not reduce the tax due for such year to less than the higher of
the amounts prescribed in paragraphs (c) and (d) of subdivision one of
this section. However, if the amount of the credit [allowable under this
subdivision for any taxable year shall exceed the taxpayer's tax for
such year, the excess may be carried over to the following year or
years, and may be deducted from the taxpayer's tax for such year or
years] ALLOWED UNDER THIS SUBDIVISION FOR ANY TAXABLE YEAR REDUCES THE
TAX TO SUCH AMOUNT, ANY AMOUNT OF CREDIT THUS NOT DEDUCTIBLE IN SUCH
TAXABLE YEAR 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, HOWEVER, THE PROVISIONS OF
SUBSECTION (C) OF SECTION ONE THOUSAND EIGHTY-EIGHT OF THIS CHAPTER
NOTWITHSTANDING, NO INTEREST SHALL BE PAID THEREON.
(5) To be eligible for the credit allowable under this subdivision,
the rehabilitation project shall be in whole or in part [a targeted area
residence within the meaning of section 143(j) of the internal revenue
code or] located within a census tract which is identified as being at
or below one hundred percent of the state median family income [in the
most recent federal census] AS CALCULATED USING A FIVE YEAR SAMPLE FROM
THE AMERICAN COMMUNITY SURVEY BEGINNING WITH THE YEAR TWO THOUSAND SIX-
-YEAR TWO THOUSAND ELEVEN SAMPLE.
S 3. Subparagraph (A) of paragraph 1, and paragraphs 4 and 5 of
subsection (u) of section 1456 of the tax law, as added by chapter 472
of the laws of 2010, are amended to read as follows:
(A) For taxable years beginning on or after January first, two thou-
sand ten and before January first, two thousand [fifteen] TWENTY, a
taxpayer shall be allowed a credit as hereinafter provided, against the
S. 2609--B 42 A. 3009--B
tax imposed by this article, in an amount equal to one hundred percent
of the amount of credit allowed the taxpayer with respect to a certified
historic structure under subsection (a)(2) of section 47 of the federal
internal revenue code with respect to a certified historic structure
located within the state. Provided, however, the credit shall not exceed
five million dollars. For taxable years beginning on or after January
first, two thousand [fifteen] TWENTY, a taxpayer shall be allowed a
credit as hereinafter provided, against the tax imposed by this article,
in an amount equal to thirty percent of the amount of credit allowed the
taxpayer with respect to a certified historic structure under subsection
(a)(2) of section 47 of the federal internal revenue code with respect
to a certified historic structure located within the state. Provided,
however, the credit shall not exceed one hundred thousand dollars.
(4) The credit allowed under this subsection for any taxable year
shall not reduce the tax to less than the dollar amount fixed as a mini-
mum tax by subsection (b) of section fourteen hundred fifty-five of this
article. [If the amount of credit allowable under this subsection for
any taxable year reduces the tax to such amount, the excess may be
carried over to the following year or years, and may be deducted from
the taxpayer's tax for such year or years.] HOWEVER, IF THE AMOUNT OF
CREDIT ALLOWED UNDER THIS SUBSECTION FOR ANY TAXABLE YEAR REDUCES THE
TAX TO SUCH AMOUNT, ANY AMOUNT OF CREDIT THUS NOT DEDUCTIBLE IN SUCH
TAXABLE YEAR 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, HOWEVER, THE PROVISIONS OF
SUBSECTION (C) OF SECTION ONE THOUSAND EIGHTY-EIGHT OF THIS CHAPTER
NOTWITHSTANDING, NO INTEREST SHALL BE PAID THEREON.
(5) To be eligible for the credit allowable under this subsection the
rehabilitation project shall be in whole or in part [a targeted area
residence within the meaning of section 143(j) of the internal revenue
code or] located within a census tract which is identified as being at
or below one hundred percent of the state median family income [in the
most recent federal census] AS CALCULATED USING A FIVE YEAR SAMPLE FROM
THE AMERICAN COMMUNITY SURVEY BEGINNING WITH THE YEAR TWO THOUSAND SIX-
-YEAR TWO THOUSAND ELEVEN SAMPLE.
S 4. Subparagraph (A) of paragraph 1, and paragraphs 4 and 5 of subdi-
vision (y) of section 1511 of the tax law, as added by chapter 472 of
the laws of 2010, are amended to read as follows:
(A) For taxable years beginning on or after January first, two thou-
sand ten and before January first, two thousand [fifteen] TWENTY, a
taxpayer shall be allowed a credit as hereinafter provided, against the
tax imposed by this article, in an amount equal to one hundred percent
of the amount of credit allowed the taxpayer with respect to a certified
historic structure under subsection (a)(2) of section 47 of the federal
internal revenue code with respect to a certified historic structure
located within the state. Provided, however, the credit shall not exceed
five million dollars. For taxable years beginning on or after January
first, two thousand [fifteen] TWENTY, a taxpayer shall be allowed a
credit as hereinafter provided, against the tax imposed by this article,
in an amount equal to thirty percent of the amount of credit allowed the
taxpayer with respect to a certified historic structure under subsection
(a)(2) of section 47 of the federal internal revenue code with respect
to a certified historic structure located within the state. Provided,
however, the credit shall not exceed one hundred thousand dollars.
(4) The credit allowed under this subdivision for any taxable year
shall not reduce the tax due for such year to less than the minimum
S. 2609--B 43 A. 3009--B
fixed by paragraph four of subdivision (a) of section fifteen hundred
two or section fifteen hundred two-a of this article, whichever is
applicable. [If the amount of the credit allowable under this subdivi-
sion for any taxable year reduces the tax to such amount, the excess may
be carried over to the following year or years, and may be deducted from
the taxpayer's tax for such year or years.] HOWEVER, IF THE AMOUNT OF
CREDITS ALLOWED UNDER THIS SUBDIVISION FOR ANY TAXABLE YEAR REDUCES THE
TAX TO SUCH AMOUNT, ANY AMOUNT OF CREDIT THUS NOT DEDUCTIBLE IN SUCH
TAXABLE YEAR 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, HOWEVER, THE PROVISIONS OF
SUBSECTION (C) OF SECTION ONE THOUSAND EIGHTY-EIGHT OF THIS CHAPTER
NOTWITHSTANDING, NO INTEREST SHALL BE PAID THEREON.
(5) To be eligible for the credit allowable under this subdivision,
the rehabilitation project shall be in whole or in part [a targeted area
residence within the meaning of section 143(j) of the internal revenue
code or] located within a census tract which is identified as being at
or below one hundred percent of the state median family income [in the
most recent federal census] AS CALCULATED USING A FIVE YEAR SAMPLE FROM
THE AMERICAN COMMUNITY SURVEY BEGINNING WITH THE YEAR TWO THOUSAND SIX-
-YEAR TWO THOUSAND ELEVEN SAMPLE.
S 5. This act shall take effect immediately and shall apply to taxable
years beginning on and after January 1, 2013; provided however the
amendments to paragraph 4 of subsection (oo) of section 606 of the tax
law made by section one of this act, the amendments to paragraph 4 of
subdivision 40 of section 210 of the tax law made by section two of this
act, the amendments to paragraph 4 of subsection (u) of section 1456 of
the tax law made by section three of this act and the amendments to
paragraph 4 of subdivision (y) of section 1511 of the tax law made by
section four of this act shall take effect January 1, 2015 and shall
apply to taxable years beginning on and after January 1, 2015 for quali-
fied rehabilitation placed in service on or after January 1, 2015.
PART G
Section 1. Section 187-b of the tax law, as amended by section 14 of
part W-1 of chapter 109 of the laws of 2006, is amended to read as
follows:
S 187-b. [Alternative fuels credit] ELECTRIC VEHICLE RECHARGING PROP-
ERTY CREDIT. 1. General. A taxpayer shall be allowed a credit, to be
credited against the taxes imposed under sections one hundred eighty-
three, one hundred eighty-four, and one hundred eighty-five of this
article. Such credit, to be computed as hereinafter provided, shall be
allowed for [alternative fuel vehicle refueling] ELECTRIC VEHICLE
RECHARGING property placed in service during the taxable year. Provided,
however, that the amount of such credit allowable against the tax
imposed by section one hundred eighty-four of this article shall be the
excess of the credit allowed by this section over the amount of such
credit allowable against the tax imposed by section one hundred eighty-
three of this article.
2. [Alternative fuel vehicle refueling property] ELECTRIC VEHICLE
RECHARGING PROPERTY. The credit under this section for [alternative
fuel vehicle refueling] ELECTRIC VEHICLE RECHARGING property shall equal
FOR EACH INSTALLATION OF PROPERTY THE LESSER OF FIVE THOUSAND DOLLARS OR
fifty percent of the cost of any such property:
(a) which is located in this state; [and]
S. 2609--B 44 A. 3009--B
(b) [for which a credit is allowed under section thirty C of the
internal revenue code but not including alternative fuel vehicle refuel-
ing property relating to a qualified hybrid vehicle as such vehicle is
defined in subparagraph (B) of paragraph three of subsection (p) of
section six hundred six of this chapter] WHICH CONSTITUTES ELECTRIC
VEHICLE RECHARGING PROPERTY; AND
(C) FOR WHICH NONE OF THE COST HAS BEEN PAID FOR FROM THE PROCEEDS OF
GRANTS, INCLUDING GRANTS FROM THE NEW YORK STATE ENERGY RESEARCH AND
DEVELOPMENT AUTHORITY OR THE NEW YORK POWER AUTHORITY.
3. Definitions. [(a)] The term ["alternative fuel vehicle refueling
property"] "ELECTRIC VEHICLE RECHARGING PROPERTY" means [any such prop-
erty which is qualified within the meaning of section thirty C of the
internal revenue code, but shall not include alternative fuel vehicle
refueling property relating to a qualified hybrid vehicle as such vehi-
cle is defined in subparagraph (B) of paragraph three of subsection (p)
of section six hundred six of this chapter] ALL THE EQUIPMENT NEEDED TO
CONVEY ELECTRIC POWER FROM THE ELECTRIC GRID OR ANOTHER POWER SOURCE TO
AN ONBOARD VEHICLE ENERGY STORAGE SYSTEM.
[(b) The term "qualified hybrid vehicle" shall have the same meaning
as provided for under subparagraph (B) of paragraph three of subsection
(p) of section six hundred six of this chapter.]
4. Carryovers. In no event shall the credit under this section be
allowed in an amount which will reduce the tax payable to less than the
applicable minimum tax fixed by section one hundred eighty-three or one
hundred eighty-five of this article. If, however, the amount of credit
allowable under this section for any taxable year reduces the tax to
such amount, any amount of credit not deductible in such taxable year
may be carried over to the following year or years and may be deducted
from the taxpayer's tax for such year or years.
5. Credit recapture[; Alternative fuel vehicle refueling property].
If, at any time before the end of its recovery period, [alternative fuel
vehicle refueling] ELECTRIC VEHICLE RECHARGING property ceases to be
qualified, a recapture amount must be added back in the year in which
such cessation occurs.
(i) Cessation of qualification. [Alternative fuel vehicle refueling
property] ELECTRIC VEHICLE RECHARGING PROPERTY ceases to be qualified
if:
(I) the property no longer qualifies as [property described in section
thirty C of the internal revenue code] ELECTRIC VEHICLE RECHARGING PROP-
ERTY; or
(II) fifty percent or more of the use of the property in a taxable
year is other than a trade or business in this state; or
(III) the taxpayer receiving the credit under this section sells or
disposes of the property and knows or has reason to know that the prop-
erty will be used in a manner described in this subparagraph.
(ii) Recapture amount. The recapture amount is equal to the credit
allowable under this section multiplied by a fraction, the numerator of
which is the total recovery period for the property minus the number of
recovery years prior to, but not including, the recapture year, and the
denominator of which is the total recovery period.
6. Termination. The credit allowed by subdivision two of this section
shall not apply in taxable years beginning after December thirty-first,
two thousand [ten] SEVENTEEN.
S 2. Subdivision 24 of section 210 of the tax law, as amended by
section 15 of part W-1 of chapter 109 of the laws of 2006, is amended to
read as follows:
S. 2609--B 45 A. 3009--B
24. [Alternative fuels] ELECTRIC VEHICLE RECHARGING PROPERTY credit.
(a) General. A taxpayer shall be allowed a credit, to be computed as
hereinafter provided, against the tax imposed by this article for
[alternative fuel vehicle refueling] ELECTRIC VEHICLE RECHARGING proper-
ty placed in service during the taxable year.
(b) [Alternative fuel vehicle refueling property] ELECTRIC VEHICLE
RECHARGING PROPERTY. The credit under this subdivision for [alternative
fuel vehicle refueling] ELECTRIC VEHICLE RECHARGING property shall equal
FOR EACH INSTALLATION OF PROPERTY THE LESSER OF FIVE THOUSAND DOLLARS OR
fifty percent of the cost of any such property:
(i) which is located in this state; [and]
(ii) [for which a credit is allowed under section thirty C of the
internal revenue code but not including alternative fuel refueling prop-
erty relating to a qualified hybrid vehicle as such vehicle is defined
in subparagraph (B) of paragraph three of subsection (p) of section six
hundred six of this chapter] WHICH IS ELECTRIC VEHICLE RECHARGING PROP-
ERTY; AND
(III) FOR WHICH NONE OF THE COST HAS BEEN PAID FOR FROM THE PROCEEDS
OF GRANTS, INCLUDING GRANTS FROM THE NEW YORK STATE ENERGY RESEARCH AND
DEVELOPMENT AUTHORITY OR THE NEW YORK POWER AUTHORITY.
(c) Definitions. The term ["alternative fuel vehicle refueling proper-
ty"] "ELECTRIC VEHICLE RECHARGING PROPERTY" means [any such property
which is qualified within the meaning of section thirty C of the inter-
nal revenue code but shall not include alternative fuel vehicle refuel-
ing property relating to a qualified hybrid vehicle as such vehicle is
defined in subparagraph (B) of paragraph three of subsection (p) of
section six hundred six of this chapter] ALL OF THE EQUIPMENT NEEDED TO
CONVEY ELECTRIC POWER FROM THE ELECTRIC GRID OR ANOTHER POWER SOURCE TO
AN ONBOARD VEHICLE ENERGY STORAGE SYSTEM.
(d) Carryovers. In no event shall the credit under this subdivision be
allowed in an amount which will reduce the tax payable to less than the
higher of the amounts prescribed in paragraphs (c) and (d) of subdivi-
sion one of this section. Provided, however, that if the amount of cred-
it allowable under this subdivision for any taxable year reduces the tax
to such amount, any amount of credit not deductible in such taxable year
may be carried over to the following year or years and may be deducted
from the taxpayer's tax for such year or years.
(e) Credit recapture. [(i) Alternative fuel vehicle refueling proper-
ty.] If, at any time before the end of its recovery period, [alternative
fuel vehicle refueling] ELECTRIC VEHICLE RECHARGING property ceases to
be qualified, a recapture amount must be added back in the year in which
such cessation occurs.
(A) [Alternative fuel vehicle refueling] ELECTRIC VEHICLE RECHARGING
property ceases to be qualified if:
(1) the property no longer qualifies as [property described in section
thirty C of the internal revenue code] ELECTRIC VEHICLE RECHARGING PROP-
ERTY; or
(2) fifty percent or more of the use of the property in a taxable year
is other than in a trade or business in this state; or
(3) the taxpayer receiving the credit under this subdivision sells or
disposes of the property and knows or has reason to know that the prop-
erty will be used in a manner described in clauses one and two of this
subparagraph.
(B) Recapture amount. The recapture amount is equal to the credit
allowable under this subdivision multiplied by a fraction, the numerator
of which is the total recovery period for the property minus the number
S. 2609--B 46 A. 3009--B
of recovery years prior to, but not including, the recapture year, and
the denominator of which is the total recovery period.
[(f) Affiliates. (i) If a credit under this subdivision is allowed to
a taxpayer with respect to a taxable year, the action taken by such
taxpayer which resulted in such credit being allowed thereto may, at the
election of the taxpayer and an affiliate thereof, be ascribed to such
affiliate. Where such affiliate, based on such ascription, is allowed
such credit and deducts from the tax otherwise due the amount of such
credit, such credit shall be deemed in all respects to have been allowed
to such affiliate, provided that any action or inaction by the taxpayer
which constitutes an event of recapture described in paragraph (e) of
this subdivision shall be ascribed to the affiliate and shall constitute
an event of recapture with respect to the credit allowed to the affil-
iate pursuant to this subdivision.
(ii) Notwithstanding any other provision of law to the contrary, in
the case of the credit provided for under this subdivision being allowed
to, or asserted to be allowed to, an affiliate, pursuant to subparagraph
(i) of this paragraph, the commissioner shall have the same powers with
respect to examining the books and records of the taxpayer, and have
such other powers of investigation with respect to the taxpayer, as are
afforded under this chapter with respect to a taxpayer which has
deducted the credit allowed under this section from tax otherwise due,
as if it were the taxpayer which had deducted such credit from tax
otherwise due.
(iii) The term "affiliate" shall mean a corporation substantially all
the capital stock of which is owned or controlled either directly or
indirectly by the taxpayer, or which owns or controls either directly or
indirectly substantially all the capital stock of the taxpayer, or
substantially all the capital stock of which is owned or controlled
either directly or indirectly by interests which own or control either
directly or indirectly substantially all the capital stock of the
taxpayer.]
[(g)] (F) Termination. The credit allowed by paragraph (b) of this
subdivision shall not apply in taxable years beginning after December
thirty-first, two thousand [ten] SEVENTEEN.
S 3. Subsection (p) of section 606 of the tax law, as amended by
section 16 of part W-1 of chapter 109 of the laws of 2006, is amended to
read as follows:
(p) [Alternative fuels] ELECTRIC VEHICLE RECHARGING PROPERTY credit.
(1) General. A taxpayer shall be allowed a credit, to be computed as
hereinafter provided, against the tax imposed by this article, for
[alternative fuel vehicle refueling] ELECTRIC VEHICLE RECHARGING proper-
ty placed in service during the taxable year.
(2) [Alternative fuel vehicle refueling property] ELECTRIC VEHICLE
RECHARGING PROPERTY. The credit under this subsection for [clean-fuel
vehicle refueling] ELECTRIC VEHICLE RECHARGING property shall equal FOR
EACH INSTALLATION OF PROPERTY THE LESSER OF FIVE THOUSAND DOLLARS OR
fifty percent of the cost of any such property
(A) which is located in this state [and];
(B) [for which a credit is allowed under section thirty C of the
internal revenue code but not including alternative fuel vehicle refuel-
ing property relating to a qualified hybrid vehicle as such vehicle is
defined in subparagraph (B) of paragraph three of this subsection] WHICH
IS ELECTRIC VEHICLE RECHARGING PROPERTY; AND
S. 2609--B 47 A. 3009--B
(C) FOR WHICH NONE OF THE COST HAS BEEN PAID FOR FROM THE PROCEEDS OF
GRANTS, INCLUDING GRANTS FROM THE NEW YORK STATE ENERGY RESEARCH AND
DEVELOPMENT AUTHORITY OR THE NEW YORK POWER AUTHORITY.
(3) Definitions. [(A)] The term ["alternative fuel vehicle refueling
property"] "ELECTRIC VEHICLE RECHARGING PROPERTY" means [any such prop-
erty which is qualified within the meaning of section thirty C of the
internal revenue code, but such term shall not include alternative fuel
vehicle refueling property relating to a qualified hybrid vehicle as
such vehicle is defined in subparagraph (B) of this paragraph] ALL THE
EQUIPMENT NEEDED TO CONVEY ELECTRIC POWER FROM THE ELECTRIC GRID OR
ANOTHER POWER SOURCE TO AN ONBOARD VEHICLE ENERGY STORAGE SYSTEM.
[(B) The term "qualified hybrid vehicle" means a motor vehicle, as
defined in section one hundred twenty-five of the vehicle and traffic
law,, that:
(i) draws propulsion energy from both
(a) an internal combustion engine (or heat engine that uses combusti-
ble fuel); and
(b) an energy storage device; and
(ii) employs a regenerative vehicle braking system that recovers waste
energy to charge such energy storage device.]
(4) Carryovers. If the amount of credit allowable under this
subsection shall exceed the taxpayer's tax for such year, the excess may
be carried over to the following year or years and may be deducted from
the taxpayer's tax for such year or years.
(5) Credit recapture. (A) [Vehicles.
(i) If, within three full years from the date a qualified hybrid vehi-
cle or a vehicle of which alternative fuel vehicle property is a part is
placed in service, such qualified hybrid vehicle or vehicle of which
alternative fuel vehicle property is a part] IF, AT ANY TIME BEFORE THE
END OF ITS RECOVERY PERIOD, ELECTRIC VEHICLE RECHARGING PROPERTY ceases
to be qualified, a recapture amount must be added back in the tax year
in which such cessation occurs.
[(ii)] (B) Cessation of qualification. [(I) A qualified hybrid vehicle
ceases to be qualified if
(a) it is modified by the taxpayer so that it no longer meets the
requirements of a qualified hybrid vehicle as defined in subparagraph
(B) of paragraph three of this subsection.
(b) the taxpayer receiving the credit under this subsection sells or
disposes of the vehicle and knows or has reason to know that the vehicle
will be so modified.
(B) Alternative fuel vehicle refueling property. (i) If, at any time
before the end of its recovery period, alternative fuel vehicle refuel-
ing property ceases to be qualified, a recapture amount must be added
back in the year in which such cessation occurs.
(ii) Cessation of qualification. Clean-fuel vehicle refueling] ELEC-
TRIC VEHICLE RECHARGING property ceases to be qualified if:
[(I)] (I) the property no longer qualifies as [property described in
section thirty C of the internal revenue code] ELECTRIC VEHICLE RECHARG-
ING PROPERTY, or
[(II)] (II) fifty percent or more of the use of the property in a
taxable year is other than in a trade or business in this state, or
[(III)] (III) the taxpayer receiving the credit under this subsection
sells or disposes of the property and knows or has reason to know that
the property will be used in a manner described in [item (I)] CLAUSE (I)
or [(II)] (II) of this [clause] SUBPARAGRAPH.
S. 2609--B 48 A. 3009--B
[(iii)] (C) Recapture amount. The recapture amount is equal to the
credit allowable under this subsection multiplied by a fraction, the
numerator of which is the total recovery period for the property minus
the number of recovery years prior to, but not including, the recapture
year, and the denominator of which is the total recovery period.
(6) Termination. The credit allowed by [paragraph two of] this
subsection shall not apply in taxable years beginning after December
thirty-first, two thousand [ten] SEVENTEEN.
S 4. Clause (ix) of subparagraph (B) of paragraph 1 of subsection (i)
of section 606 of the tax law, as amended by section 7 of part C-1 of
chapter 57 of the laws of 2009, is amended to read as follows:
(ix) [Alternative fuels] [Cost] AMOUNT OF CREDIT
ELECTRIC VEHICLE under subdivision twenty-four
RECHARGING PROPERTY of section two hundred ten
credit under subsection (p)
S 5. This act shall take effect immediately and shall apply to taxable
years beginning on or after January 1, 2013 for property placed in
service on or after such date.
PART H
Section 1. Paragraph 10 of subsection (g) of section 658 of the tax
law is REPEALED.
S 2. Paragraph 10 of subdivision (g) of section 11-1758 of the admin-
istrative code of the city of New York is REPEALED.
S 3. Paragraph 5 of subsection (u) of section 685 of the tax law is
REPEALED.
S 4. Paragraph 5 of subdivision (t) of section 11-1785 of the adminis-
trative code of the city of New York is REPEALED.
S 5. Section 23 of part U of chapter 61 of the laws of 2011, as
amended by section 1 of part G of chapter 59 of the laws of 2012, is
amended to read as follows:
S 23. This act shall take effect immediately; provided, however, that:
(a) the amendments to section 29 of the tax law made by section thir-
teen of this act shall apply to tax documents filed or required to be
filed on or after the sixtieth day after which this act shall have
become a law [and shall expire and be deemed repealed December 31,
2013], provided however that the amendments to paragraph 4 of subdivi-
sion (a) of section 29 of the tax law and paragraph 2 of subdivision (e)
of section 29 of the tax law made by section thirteen of this act with
regard to individual taxpayers shall take effect September 15, 2011 but
only if the commissioner of taxation and finance has reported in the
report required by section seventeen-b of this act that the percentage
of individual taxpayers electronically filing their 2010 income tax
returns is less than eighty-five percent; provided that the commissioner
of taxation and finance shall notify the legislative bill drafting
commission of the date of the issuance of such report in order that the
commission may maintain an accurate and timely effective data base of
the official text of the laws of the state of New York in furtherance of
effectuating the provisions of section 44 of the legislative law and
section 70-b of the public officers law;
(b) sections fourteen, fifteen, sixteen and seventeen of this act
shall take effect September 15, 2011 but only if the commissioner of
taxation and finance has reported in the report required by section
S. 2609--B 49 A. 3009--B
seventeen-b of this act that the percentage of individual taxpayers
electronically filing their 2010 income tax returns is less than eight-
y-five percent;
(c) sections fourteen-a and fifteen-a of this act shall take effect
September 15, 2011 and expire and be deemed repealed December 31, 2012
but shall take effect only if the commissioner of taxation and finance
has reported in the report required by section seventeen-b of this act
that the percentage of individual taxpayers electronically filing their
2010 income tax returns is eighty-five percent or greater; AND
(d) sections fourteen-b, fifteen-b, sixteen-a and seventeen-a of this
act shall take effect January 1, 2014 but only if the commissioner of
taxation and finance has reported in the report required by section
seventeen-b of this act that the percentage of individual taxpayers
electronically filing their 2010 income tax returns is less than eight-
y-five percent[; and
(e) sections twenty-one and twenty-one-a of this act shall expire and
be deemed repealed December 31, 2013].
S 6. This act shall take effect immediately.
PART I
Section 1. Legislative intent. The legislature seeks to demonstrate
that the state of New York is open for business by promoting, attract-
ing, and encouraging the development of business in the state. The
legislature intends to encourage businesses to locate in the state and
produce goods and services within the state, thereby increasing job
creation and economic growth. The legislature further intends to foster
economic development by showcasing various goods that are produced in
New York. In order to accomplish these objectives, the legislature
intends that there shall be established "Taste-NY facilities," which
will sell a variety of products, including but not limited to products
produced within the state, and prominently feature New York produced
goods, including alcoholic beverages.
S 2. Subdivision (b) of section 1101 of the tax law is amended by
adding a new paragraph 39 to read as follows:
(39) TASTE-NY FACILITY. "TASTE-NY FACILITY" SHALL MEAN A FACILITY
OPERATED BY A PERSON DESIGNATED BY AND PURSUANT TO A WRITTEN AGREEMENT
WITH A STATE AGENCY, PUBLIC AUTHORITY, OR AN INTERSTATE AGENCY OR PUBLIC
CORPORATION CREATED PURSUANT TO AN AGREEMENT OR COMPACT WITH ANOTHER
STATE OR THE DOMINION OF CANADA, FROM WHICH SALES ARE MADE OF TANGIBLE
PERSONAL PROPERTY OR FOOD AND DRINK (WHETHER OR NOT FOR CONSUMPTION ON
THE PREMISES OF SUCH FACILITY), AND THAT PROMINENTLY FEATURES PRODUCTS
PRODUCED WITHIN THE STATE.
S 3. Subdivision (a) of section 1115 of the tax law is amended by
adding a new paragraph 44 to read as follows:
(44) TANGIBLE PERSONAL PROPERTY SOLD AT A TASTE-NY FACILITY, AS
DEFINED IN PARAGRAPH THIRTY-NINE OF SECTION ELEVEN HUNDRED ONE OF THIS
ARTICLE, FOR WHICH THE RECEIPT OR CONSIDERATION GIVEN OR CONTRACTED TO
BE GIVEN IS LESS THAN TWO HUNDRED DOLLARS PER ITEM.
S 4. Section 1115 of the tax law is amended by adding a new subdivi-
sion (ii) to read as follows:
(II) RECEIPTS FROM SALES OF THE FOLLOWING AT A TASTE-NY FACILITY SHALL
BE EXEMPT FROM THE SALES TAX IMPOSED UNDER SECTION ELEVEN HUNDRED FIVE
AND THE COMPENSATING USE TAX IMPOSED UNDER SECTION ELEVEN HUNDRED TEN OF
THIS ARTICLE: (1) FOOD OR DRINK FOR CONSUMPTION ON THE PREMISES OF SUCH
FACILITY; (2) FOOD OR DRINK SOLD FOR CONSUMPTION OFF THE PREMISES OF
S. 2609--B 50 A. 3009--B
SUCH FACILITY THAT IS SOLD IN A HEATED STATE; (3) SANDWICHES SOLD FOR
CONSUMPTION OFF THE PREMISES OF SUCH FACILITY, WHETHER OR NOT SOLD IN A
HEATED STATE; (4) FOOD OR DRINK SOLD THROUGH VENDING MACHINES; AND (5)
FOOD OR DRINK SOLD IN AN UNHEATED STATE THAT IS OF A TYPE COMMONLY SOLD
FOR OFF-PREMISES CONSUMPTION AND IS NOT IN THE SAME FORM, CONDITION,
QUANTITIES AND PACKAGING AS IN ESTABLISHMENTS THAT ARE FOOD STORES OTHER
THAN THOSE PRINCIPALLY ENGAGED IN SELLING FOODS PREPARED AND READY TO BE
EATEN.
S 5. The alcoholic beverage control law is amended by adding a new
section 63-b to read as follows:
S 63-B. SPECIAL LICENSE TO SELL ALCOHOLIC BEVERAGES AT RETAIL FOR
CONSUMPTION OFF THE PREMISES. 1. ANY PERSON AUTHORIZED TO OPERATE A
TASTE-NY FACILITY DESIGNATED BY AND PURSUANT TO A WRITTEN AGREEMENT WITH
A STATE AGENCY, PUBLIC AUTHORITY, OR AN INTERSTATE AGENCY OR PUBLIC
CORPORATION CREATED PURSUANT TO AN AGREEMENT OR COMPACT WITH ANOTHER
STATE OR THE DOMINION OF CANADA MAY MAKE APPLICATION TO THE AUTHORITY
FOR A SPECIAL LICENSE TO SELL ALCOHOLIC BEVERAGES AT RETAIL FOR CONSUMP-
TION OFF THE LICENSED PREMISES.
2. AN APPLICATION FOR A LICENSE UNDER THIS SECTION SHALL BE IN SUCH
FORM AND SHALL CONTAIN SUCH INFORMATION AS SHALL BE REQUIRED BY THE
AUTHORITY AND SHALL BE ACCOMPANIED BY A CHECK OR DRAFT IN THE AMOUNT
REQUIRED BY THIS ARTICLE.
3. SECTION FIFTY-FOUR OF THIS CHAPTER SHALL CONTROL SO FAR AS IS
APPLICABLE THE PROCEDURE IN CONNECTION WITH SUCH APPLICATION.
4. A LICENSE UNDER THIS SECTION SHALL BE ISSUED TO ALL ELIGIBLE APPLI-
CANTS EXCEPT FOR GOOD CAUSE SHOWN.
5. A LICENSE UNDER THIS CHAPTER SHALL NOT BE SUBJECT TO THE PROVISIONS
OF SUBDIVISIONS TWO, THREE, SIX AND SIXTEEN OF SECTION ONE HUNDRED FIVE
OF THIS CHAPTER.
6. NOTWITHSTANDING THE PROVISIONS OF SUBDIVISION FOURTEEN OF SECTION
ONE HUNDRED FIVE OF THIS CHAPTER, THE HOURS OF OPERATION AND SALE OF
ALCOHOLIC BEVERAGES SHALL BE GOVERNED BY THE LICENSEE'S WRITTEN AGREE-
MENT WITH THE STATE AGENCY, PUBLIC AUTHORITY, INTERSTATE AGENCY OR
COMPACT ENTITY.
7. SUBJECT TO ANY RESTRICTION CONTAINED IN THE WRITTEN AGREEMENT WITH
THE STATE AGENCY, PUBLIC AUTHORITY, INTERSTATE AGENCY OR COMPACT ENTITY,
THE HOLDER OF A LICENSE ISSUED UNDER THIS SECTION MAY OFFER SAMPLES OF
ALCOHOLIC BEVERAGES TO CUSTOMERS TO BE CONSUMED ON THE LICENSED PREMISES
UPON THE FOLLOWING CONDITIONS:
(A) NO FEE SHALL BE CHARGED FOR ANY SAMPLE;
(B) EACH SAMPLE SHALL BE LIMITED:
(I) IN THE CASE OF BEER, WINE PRODUCTS AND CIDER, TO THREE OUNCES OR
LESS;
(II) IN THE CASE OF WINE, TO TWO OUNCES;
(III) IN THE CASE OF LIQUOR, TO ONE-QUARTER OUNCE;
(C) NO SAMPLE SHALL BE PROVIDED TO A CUSTOMER DURING THE HOURS PROHIB-
ITED BY THE PROVISIONS OF SUBDIVISION FIVE OF SECTION ONE HUNDRED SIX OF
THIS CHAPTER; AND
(D) NO CUSTOMER MAY BE PROVIDED WITH MORE THAN THREE SAMPLES IN ONE
CALENDAR DAY.
S 6. Section 66 of the alcoholic beverage control law is amended by
adding a new subdivision 11 to read as follows:
11. THE ANNUAL FEE FOR A SPECIAL LICENSE TO SELL ALCOHOLIC BEVERAGES
AT RETAIL FOR CONSUMPTION OFF THE LICENSED PREMISES SHALL BE FIVE
HUNDRED DOLLARS.
S. 2609--B 51 A. 3009--B
S 7. Section 67 of the alcoholic beverage control law, as amended by
section 4 of part Z of chapter 85 of the laws of 2002, is amended to
read as follows:
S 67. License fees, duration of licenses; fee for part of year.
[Effective April first, nineteen hundred eighty-three, licenses] 1.
LICENSES issued pursuant to sections sixty-one, sixty-two, sixty-three,
[sixty-four, sixty-four-a and sixty-four-b] AND SIXTY-THREE-B of this
article shall be effective for three years at three times that annual
fee, except that, in implementing the purposes of this section, the
liquor authority shall schedule the commencement dates, duration and
expiration dates thereof to provide for an equal cycle of license
renewals issued under each such section through the course of the fiscal
year. [Effective December first, nineteen hundred ninety-eight,
licenses]
2. LICENSES issued pursuant to sections sixty-four, sixty-four-a and
sixty-four-b of this article shall be effective for two years at two
times that annual fee, except that, in implementing the purposes of this
section, the liquor authority shall schedule the commencement dates,
duration and expiration dates thereof to provide for an equal cycle of
license renewals issued under each such section through the course of
the fiscal year. [Notwithstanding the foregoing, commencing on December
first, nineteen hundred ninety-eight and concluding on July thirty-
first, two thousand two, a licensee issued a license pursuant to section
sixty-four, sixty-four-a or sixty-four-b of this article may elect to
remit the fee for such license in equal annual installments. Such
installments shall be due on dates established by the liquor authority
and the failure of a licensee to have remitted such annual installments
after a due date shall be a violation of this chapter. For licenses
issued for less than the three-year licensing period, the license fee
shall be levied on a pro-rated basis.]
3. The entire license fee shall be due and payable at the time of
application. The liquor authority may make such rules as shall be appro-
priate to carry out the purpose of this section.
S 8. Subdivisions 1 and 2 of section 56-a of the alcoholic beverage
control law, as amended by chapter 108 of the laws of 2012, are amended
to read as follows:
1. In addition to the annual fees provided for in this chapter, there
shall be paid to the authority with each initial application for a
license filed pursuant to section fifty-one, fifty-one-a, fifty-three,
fifty-eight, sixty-one, sixty-two, seventy-six or seventy-eight of this
chapter, a filing fee of four hundred dollars; with each initial appli-
cation for a license filed pursuant to section sixty-three,
SIXTY-THREE-B, sixty-four, sixty-four-a or sixty-four-b of this chapter,
a filing fee of two hundred dollars; with each initial application for a
license filed pursuant to section fifty-three-a, fifty-four, fifty-five,
fifty-five-a, seventy-nine, eighty-one or eighty-one-a of this chapter,
a filing fee of one hundred dollars; with each initial application for a
permit filed pursuant to section ninety-one, ninety-one-a, ninety-two,
ninety-two-a, ninety-three, ninety-three-a, if such permit is to be
issued on a calendar year basis, ninety-four, ninety-five, ninety-six or
ninety-six-a, or pursuant to paragraph b, c, e or j of subdivision one
of section ninety-nine-b of this chapter if such permit is to be issued
on a calendar year basis, or for an additional bar pursuant to subdivi-
sion four of section one hundred of this chapter, a filing fee of twenty
dollars; and with each application for a permit under section ninety-
three-a of this chapter, other than a permit to be issued on a calendar
S. 2609--B 52 A. 3009--B
year basis, section ninety-seven, ninety-eight, ninety-nine, or ninety-
nine-b of this chapter, other than a permit to be issued pursuant to
paragraph b, c, e or j of subdivision one of section ninety-nine-b of
this chapter on a calendar year basis, a filing fee of ten dollars.
2. In addition to the annual fees provided for in this chapter, there
shall be paid to the authority with each renewal application for a
license filed pursuant to section fifty-one, fifty-one-a, fifty-three,
fifty-eight, sixty-one, sixty-two, seventy-six or seventy-eight of this
chapter, a filing fee of one hundred dollars; with each renewal applica-
tion for a license filed pursuant to section sixty-three, SIXTY-THREE-B,
sixty-four, sixty-four-a or sixty-four-b of this chapter, a filing fee
of ninety dollars; with each renewal application for a license filed
pursuant to section seventy-nine, eighty-one or eighty-one-a of this
chapter, a filing fee of twenty-five dollars; and with each renewal
application for a license or permit filed pursuant to section fifty-
three-a, fifty-four, fifty-five, fifty-five-a, ninety-one, ninety-one-a,
ninety-two, ninety-two-a, ninety-three, ninety-three-a, if such permit
is issued on a calendar year basis, ninety-four, ninety-five, ninety-six
or ninety-six-a of this chapter or pursuant to subdivisions b, c, e or j
of section ninety-nine-b, if such permit is issued on a calendar year
basis, or with each renewal application for an additional bar pursuant
to subdivision four of section one hundred of this chapter, a filing fee
of thirty dollars.
S 9. Paragraph (a) of subdivision 1 of section 101 of the alcoholic
beverage control law, as amended by chapter 22 of the laws of 2011, is
amended to read as follows:
(a) Be interested directly or indirectly in any premises where any
alcoholic beverage is sold at retail; or in any business devoted wholly
or partially to the sale of any alcoholic beverage at retail by stock
ownership, interlocking directors, mortgage or lien or any personal or
real property, or by any other means. The provisions of this paragraph
shall not apply to:
(i) any such premises or business constituting the overnight lodging
and resort facility located wholly within the boundaries of the town of
North Elba, county of Essex, township eleven, Richard's survey, great
lot numbers two hundred seventy-eight, two hundred seventy-nine, two
hundred eighty, two hundred ninety-eight, two hundred ninety-nine, three
hundred, three hundred eighteen, three hundred nineteen, three hundred
twenty, three hundred thirty-five and three hundred thirty-six, and
township twelve, Thorn's survey, great lot numbers one hundred six and
one hundred thirteen, as shown on the Adirondack map, compiled by the
conservation department of the state of New York - nineteen hundred
sixty-four edition, in the Essex county atlas at page twenty-seven in
the Essex county clerk's office, Elizabethtown, New York, provided that
such facility maintains not less than two hundred fifty rooms and suites
for overnight lodging[,];
(ii) any such premises or business constituting the overnight lodging
and resort facility located wholly within the boundaries of that tract
or parcel of land situate in the city of Canandaigua, county of Ontario,
beginning at a point in the northerly line of village lot nine where it
meets with South Main Street, thence south sixty-nine degrees fifty-four
minutes west a distance of nine hundred sixteen and twenty-three
hundredths feet to an iron pin; thence in the same course a distance of
fourteen feet to an iron pin; thence in the same course a distance of
fourteen and four-tenths feet to a point; thence south fifteen degrees
thirty-eight minutes and forty seconds east a distance of four hundred
S. 2609--B 53 A. 3009--B
forty-six and eighty-seven hundredths feet to a point; thence south
twenty-eight degrees thirty-seven minutes and fifty seconds east a
distance of one hundred thirteen and eighty-four hundredths feet to a
point; thence south eighty-five degrees and forty-seven minutes east a
distance of forty-seven and sixty-one hundredths feet to an iron pin;
thence on the same course a distance of three hundred and sixty-five
feet to an iron pin; thence north seventeen degrees twenty-one minutes
and ten seconds east a distance of four hundred fifty-seven and thirty-
two hundredths feet to an iron pin; thence north nineteen degrees and
thirty minutes west a distance of two hundred and forty-eight feet to a
point; thence north sixty-nine degrees and fifty-four minutes east a
distance of two hundred eighty-four and twenty-six hundredths feet to a
point; thence north nineteen degrees and thirty minutes west a distance
of sixty feet to the point and place of beginning, provided that such
facility maintains not less than one hundred twenty rooms and suites for
overnight lodging[,];
(iii) any such premises or business constituting the overnight lodging
facility located wholly within the boundaries of that tract or parcel of
land situated in the borough of Manhattan, city and county of New York,
beginning at a point on the northerly side of west fifty-fourth street
at a point one hundred feet easterly from the intersection of the said
northerly side of west fifty-fourth street and the easterly side of
seventh avenue; running thence northerly and parallel with the easterly
side of seventh avenue one hundred feet five inches to the center line
of the block; running thence easterly and parallel with the northerly
side of west fifty-fourth street and along the center line of the block
fifty feet to a point; running thence northerly and parallel with the
easterly side of seventh avenue one hundred feet five inches to the
southerly side of west fifty-fifth street at a point distant one hundred
fifty feet easterly from the intersection of the said southerly side of
west fifty-fifth street and the easterly side of seventh avenue; running
thence easterly along the southerly side of west fifty-fifth street
thirty-one feet three inches to a point; running thence southerly and
parallel with the easterly side of the seventh avenue one hundred feet
five inches to the center line of the block; running thence easterly
along the center line of the block and parallel with the southerly side
of west fifty-fifth street, one hundred feet; running thence northerly
and parallel with the easterly side of seventh avenue one hundred feet
five inches to the southerly side of west fifty-fifth street; running
thence easterly along the southerly side of west fifty-fifth street
twenty-one feet ten and one-half inches to a point; running thence
southerly and parallel with the easterly side of seventh avenue one
hundred feet five inches to the center line of the block; running thence
westerly along the center line of the block and parallel with the north-
erly side of west fifty-fourth street three feet one and one-half inch-
es; running thence southerly and parallel with the easterly side of
seventh avenue one hundred feet five inches to the northerly side of
west fifty-fourth street at a point distant three hundred feet easterly
from the intersection of the said northerly side of west fifty-fourth
street and the easterly side of seventh avenue; running thence westerly
and along the northerly side of west fifty-fourth street two hundred
feet to the point or place of beginning, provided that such facility
maintains not less than four hundred guest rooms and suites for over-
night lodging[,];
(iv) any such premises or business located on that tract or parcel of
land, or any subdivision thereof, situate in the Village of Lake Placid,
S. 2609--B 54 A. 3009--B
Town of North Elba, Essex County, New York; it being also a part of Lot
No. 279, Township No. 11, Old Military Tract, Richard's Survey; it
being also all of Lot No. 23 and part of Lot No. 22 as shown and desig-
nated on a certain map entitled "Map of Building Sites for Sale by B.R.
Brewster" made by G.T. Chellis C.E. in 1892; also being PARCEL No. 1 on
a certain map of lands of Robert J. Mahoney and wife made by G.C.
Sylvester, P.E. & L.S. # 21300, dated August 4, 1964, and filed in the
Essex County Clerk's Office on August 27, 1964, and more particularly
bounded and described as follows; BEGINNING at the intersection of the
northerly bounds of Shore Drive (formerly Mirror Street) with the
westerly bounds of Park Place (formerly Rider Street) which point is
also the northeast corner of Lot No. 23, from thence South 21°50' East
in the westerly bounds of Park Place a distance of 119 feet, more or
less, to a lead plug in the edge of the sidewalk marking the southeast
corner of Lot No. 23 and the northeast corner of Lot No. 24; from thence
South 68°00'50" West a distance of 50.05 feet to an iron pipe set in
concrete at the corner of Lots 23 and 22; from thence South 65°10'50"
West a distance of 7.94 feet along the south line of Lot No. 22 to an
iron pipe for a corner; from thence North 23°21'40" West and at 17.84
feet along said line passing over a drill hole in a concrete sidewalk,
and at 68.04 feet further along said line passing over an iron pipe at
the southerly edge of another sidewalk, and at 1.22 feet further along
said line passing over another drill hole in a sidewalk, a total
distance of 119 feet, more or less, to the northerly line of Lot. No.
22; from thence easterly in the northerly line of Lot 22 and 23 to the
northeast corner of Lot No. 23 and the point of beginning. Also includ-
ing the lands to the center of Shore Drive included between the norther-
ly straight line continuation of the side lines of the above described
parcel, and to the center of Park Place, where they abut the above
described premises SUBJECT to the use thereof for street purposes. Being
the same premises conveyed by Morestuff, Inc. to Madeline Sellers by
deed dated June 30, 1992, recorded in the Essex County Clerk's Office on
July 10, 1992 in Book 1017 of Deeds at Page 318;
(v) any such premises or business located on that certain piece or
parcel of land, or any subdivision thereof, situate, lying and being in
the Town of Plattsburgh, County of Clinton, State of New York and being
more particularly bounded and described as follows: Starting at an iron
pipe found in the easterly bounds of the highway known as the Old Mili-
tary Turnpike, said iron pipe being located 910.39 feet southeasterly,
as measured along the easterly bounds of said highway, from the souther-
ly bounds of the roadway known as Industrial Parkway West, THENCE
running S 31 ° 54' 33" E along the easterly bounds of said Old Military
Turnpike Extension, 239.88 feet to a point marking the beginning of a
curve concave to the west; thence southerly along said curve, having a
radius of 987.99 feet, 248.12 feet to an iron pipe found marking the
point of beginning for the parcel herein being described, said point
also marked the southerly corner of lands of Larry Garrow, et al, as
described in Book 938 of Deeds at page 224; thence N 07° 45' 4" E along
the easterly bounds of said Garrow, 748.16 feet to a 3"x4" concrete
monument marking the northeasterly corner of said Garrow, the northwes-
terly corner of the parcel herein being described and said monument also
marking the southerly bounds of lands of Salerno Plastic Corp. as
described in Book 926 of Deeds at Page 186; thence S 81° 45' 28" E along
a portion of the southerly bounds of said Salerno Plastic Corp., 441.32
feet to an iron pin found marking the northeasterly corner of the parcel
herein being described and also marking the northwest corner of the
S. 2609--B 55 A. 3009--B
remaining lands now or formerly owned by said Marx and Delaura; thence S
07° 45' 40" W along the Westerly bounds of lands now of formerly of said
Marx and DeLaura and along the easterly bounds of the parcel herein
being described, 560.49 feet to an iron pin; thence N 83° 43' 21" W
along a portion of the remaining lands of said Marx and DeLaura, 41.51
feet to an iron pin; thence S 08° 31' 30" W, along a portion of the
remaining lands of said Marx and Delaura, 75.01 feet to an iron pin
marking northeasterly corner of lands currently owned by the Joint Coun-
cil for Economic Opportunity of Plattsburgh and Clinton County, Inc. as
described in Book 963 of Deeds at Page 313; thence N 82° 20' 32" W along
a portion of the northerly bounds of said J.C.E.O., 173.50 feet to an
iron pin; thence 61° 21' 12" W, continuing along a portion of the north-
erly bounds of said J.C.E.O., 134.14 feet to an iron pin; thence S 07°
45' 42" W along the westerly bounds of said J.C.E.O., 50 feet to an iron
pin; thence S 66° 48' 56" W along a portion of the northerly bounds of
remaining lands of said Marx and DeLaura, 100.00 feet to an iron pipe
found on the easterly bounds of the aforesaid highway, said from pipe
also being located on a curve concave to the west; thence running and
running northerly along the easterly bounds of the aforesaid highway and
being along said curve, with the curve having a radius of 987.93 feet,
60.00 feet to the point of beginning and containing 6.905 acres of land.
Being the same premises as conveyed to Ronald Marx and Alice Marx by
deed of CIT Small Business Lending Corp., as agent of the administrator,
U.S. Small Business Administration, an agency of the United States
Government dated September 10, 2001 and recorded in the office of the
Clinton County Clerk on September 21, 2001 as Instrument #135020; [or]
(vi) any such premises or business located on the west side of New
York state route 414 in military lots 64 and 75 located wholly within
the boundaries of that tract or parcel of land situated in the town of
Lodi, county of Seneca beginning at an iron pin on the assumed west line
of New York State Route 414 on the apparent north line of lands reputed-
ly of White (lib. 420, page 155); said iron pin also being northerly a
distance of 1200 feet more or less from the centerline of South Miller
Road; Thence leaving the point of beginning north 85-17'-44" west along
said lands of White a distance of 2915.90 feet to an iron pin Thence
north 03-52'-48" east along said lands of White, passing through an iron
pin 338.36 feet distant, and continuing further along that same course a
distance of 13.64 feet farther, the total distance being 352.00 feet to
a point in the assumed centerline of Nellie Neal Creek; Thence in gener-
ally a north westerly direction the following courses and distances
along the assumed centerline of Nellie Neal Creek; north 69-25'-11" west
a distance of 189.56 feet to a point; north 63-40'-00" west a distance
of 156.00 feet to a point; north 49-25'-00" west a distance of 80.00
feet to a point; south 80-21'-00" west a distance of 90.00 feet to a
point; north 72-03'-00" west a distance of 566.00 feet to a point; north
68-15'-00" west a distance of 506.00 feet to a point; north 55-16'-00"
west a distance of 135.00 feet to a point; south 69-18'-00" west a
distance of 200.00 feet to a point; south 88-00'-00" west a distance of
170.00 feet to a point on a tie line at or near the high water line of
Seneca Lake; Thence north 25-17'-00" east along said tie line a distance
of 238.00 feet to an iron pipe; Thence south 82-04'-15" east along lands
reputedly of M. Wagner (lib. 464, page 133) a distance of 100.00 feet to
an iron pin; Thence north 06-56'-47" east along said lands of M. Wagner
a distance of 100.00 feet to an iron pipe; Thence north 09-34'-28" east
along lands reputedly of Schneider (lib. 429, page 37) a distance of
50.10 feet to an iron pipe; Thence north 07-49'-11" east along lands
S. 2609--B 56 A. 3009--B
reputedly of Oney (lib. 484, page 24) a distance of 50.00 feet to an
iron pipe; Thence north 82-29'-40" west along said lands of Oney a
distance of 95.30 feet to an iron pipe on a tie line at or near the
highwater line of Seneca Lake; Thence north 08-15'-22" east along said
tie line a distance of 25.00 feet to an iron pin; Thence south
82-28'-00" east along lands reputedly of Yu (lib. 405, page 420) a
distance of 96.53 feet to an iron pipe; Thence north 34-36'-59" east
along said lands of Yu a distance of 95.00 feet to a point in the
assumed centerline of Van Liew Creek; Thence in generally an easterly
direction the following courses and distances along the assumed center-
line of Van Liew Creek; north 72-46'-37" east a distance of 159.98 feet
to a point; north 87-53'-00" east a distance of 94.00 feet to a point;
south 71-12'-00" east a distance of 52.00 feet to a point; south
84-10'-00" east a distance of 158.00 feet to a point; south 59-51'-00"
east a distance of 160.00 feet to a point; south 83-29'-00" east a
distance of 187.00 feet to a point; Thence north 01-33'-40" east along
lands reputedly of Hansen (lib. 515, page 205) passing through an iron
pipe 32.62 feet distant, and continuing further along that same course
passing through an iron pin 205.38 feet farther, and continuing still
further along that same course a distance of 21.45 feet farther, the
total distance being 259.45 feet to the assumed remains of a White Oak
stump; Thence north 69-16'-11" east along lands reputedly of Schwartz
(lib. 374, page 733) being tie lines along the top of the south bank of
Campbell Creek a distance of 338.00 feet to a point; Thence south
57-17'32" east along said tie line a distance of 136.60 feet to a point;
Thence south 74-45'-00" east along said tie line a distance of 100.00
feet to an iron pin; Thence north 04-46'-00" east along said lands of
Schwartz a distance of 100.00 feet to a point in the assumed centerline
of Campbell Creek; Thence in generally an easterly direction the follow-
ing courses and distances along the assumed centerline of Campbell
Creek; south 71-34'-00" east a distance of 330.00 feet to a point; north
76-53'-00" east a distance of 180.00 feet to a point; north 83-05'00"
east a distance of 230.00 feet to a point; south 66-44'-00" east a
distance of 90.00 feet to a point; south 81-10'-00" east a distance of
240.00 feet to a point; south 45-29'-15" east a distance of 73.18 feet
to a point; Thence south 05-25'-50" west along lands reputedly of Stan-
ley Wagner (lib. 450, page 276) a distance of 135.00 feet to a point on
the assumed north line of Military Lot 75; Thence south 84-34'-10" east
along said lands of Wagner and the assumed north line of Military Lot 75
a distance of 1195.06 feet to an iron pin; Thence south O6-57'52" west
along said lands of M. Wagner (lib. 414, page 267) passing through an
iron pin 215.58 feet distant, and continuing further along that same
course a distance of 20.59 feet farther, the total distance being 236.17
feet to a point in the assumed centerline of Campbell Creek; Thence in
generally a south easterly direction the following course and distances
along the assumed centerline of Campbell Creek; north 78-23'-09" east a
distance of 29.99 feet to a point; south 46-09'-15" east a distance of
65.24 feet to a point; north 85-55'-09" east a distance of 60.10 feet to
a point; south 61-59'-50" east a distance of 206.91 feet to a point;
north 63-58'-27" east a distance of 43.12 feet to a point; south
28-51'-21" east a distance of 47.72 feet to a point; south 15-14'-08"
west a distance of 33.42 feet to a point; south 79-16'-32" east a
distance of 255.15 feet to a point; south 62-19'-46" east a distance of
75.82 feet to a point; north 76-10'-42" east a distance of 99.60 feet to
a point; north 82-12'55" east a distance of 86.00 feet to a point; south
44-13'53" east a distance of 64.08 feet to a point; north 67-52'-46"
S. 2609--B 57 A. 3009--B
east a distance of 73.98 feet to a point; north 88-13'-13" east a
distance of 34.64 feet to a point on the assumed west line of New York
State Route 414; Thence south 20-13'-30" east along the assumed west
line of New York State Route 414 a distance of 248.04 feet to a concrete
monument; Thence south 02-10'-30" west along said road line a distance
of 322.90 feet to an iron pin; Thence 13-14'-50" west along said road
line a distance of 487.41 feet to an iron pin, said iron pin being the
point and place of beginning; Comprising an area of 126.807 acres of
land according to a survey completed by Michael D. Karlsen entitled
"Plan Owned by Stanley A. Wagner" known as Parcel A of Job number
98-505. This survey is subject to all utility easements and easements
and right-of-ways of record which may affect the parcel of land. This
survey is also subject to the rights of the public in and to lands here-
in referred to as New York State Route 414. This survey intends to
describe a portion of the premises as conveyed by Ruth V. Wagner to
Stanley A. Wagner by deed recorded February 10, 1989 in Liber 450 of
deeds, at Page 286. This survey also intends to describe a portion of
the premises as conveyed by Stanley W. VanVleet to Stanley A. Wagner by
deed recorded April 30, 1980 in Liber 385 of Deeds, at Page 203.
ALSO ALL THAT OTHER TRACT OR PARCEL OF LAND SITUATE on the east side of
New York State Route 414 in Military Lot 75 in the Town of Lodi, County
of Seneca, State of New York bounded and described as follows: Begin-
ning at an iron pin on the assumed east line of New York State Route
414, said iron pin being north 50-44'-57" east a distance of 274.92 feet
from the south east corner of the parcel of land herein above described;
Thence leaving the point of beginning north 00-26'01" east along a math-
ematical tie line a distance of 504.91 feet to an iron pin; Thence south
37-00'-20" east along lands reputedly of Tomberelli (lib. 419, page 243)
passing through an iron pin 176.00 feet distant, and continuing further
along that same course a distance of 2.01 feet farther, the total
distance being 178.01 feet to a point; Thence south 09-03'-55" west
along lands reputedly of M. Wagner (lib. 491, page 181) a distance of
68.19 feet to an iron pipe; Thence south 15-36'-04" west along said
lands of M. Wagner a distance of 300.15 feet to an iron pipe; Thence
south 72-04'-59" west along said lands of M. Wagner a distance of 20.49
feet to an iron pin, said iron pin being the point and place of begin-
ning. Comprising an area of 0.727 acre of lands according to a survey
completed by Michael D. Karlsen entitled "Plan of Land Owned by Stanley
A. Wagner" known as Parcel B of job number 98-505. This survey is
subject to all utility easements and easements and right-of-ways of
record which may affect this parcel of land. This survey is also
subject to the rights of the public in and to lands herein referred to
as New York State Route 414. This survey intends to describe the same
premises as conveyed by Henry W. Eighmey as executor of the Last Will
and Testament of Mary C. Eighmey to Stanley A. Wagner by deed recorded
July 2, 1996 in liber 542, page 92. This survey also intends to
describe a portion of the premises as conveyed by Ruth V. Wagner to
Stanley A. Wagner by deed recorded February 10, 1989 in Liber 450 of
deeds, at Page 286[.];
[The provisions of this paragraph shall not apply to] (VII) any prem-
ises or business located wholly within the following described parcel:
ALL THAT TRACT OR PARCEL OF LAND situate in the City of Corning, County
of Steuben and State of New York bounded and described as follows:
Beginning at an iron pin situate at the terminus of the westerly line of
Townley Avenue at its intersection with the southwesterly line of New
York State Route 17; thence S 00° 45' 18" E along the westerly line of
S. 2609--B 58 A. 3009--B
Townley Avenue, a distance of 256.09 feet to a point; thence S 89° 02'
07" W through an iron pin placed at a distance of 200.00 feet, a total
distance of 300.00 feet to an iron pin; thence N 00° 59' 17" W a
distance of 47.13 feet to an iron pin; thence S 89° 02' 07" W a distance
of 114.56 feet to a point situate in the southeast corner of Parcel A-2
as set forth on a survey map hereinafter described; thence N 14° 18' 49"
E a distance of 124.40 feet to an iron pin situate at the southeast
corner of lands now or formerly of Cicci (Liber 923, Page 771); thence N
14° 18' 49" E a distance of 76.46 feet to an iron pin; thence N 00° 57'
53" W a distance of 26.25 feet to an iron pin marking the southeast
corner of parcel A-1 as set forth on the hereinafter described survey
map; thence N 00° 58' 01" W a distance of 166.00 to an iron pin situate
at the northeast corner of said Parcel A-1, which pin also marks the
southeast corner of lands now or formerly of Becraft (Liber 1048, Page
1086); thence N 00° 57' 53" W a distance of 106.00 feet to an iron pin
situate in the southerly line of lands now or formerly of the United
States Postal Service; thence N 89° 02' 07" E along the southerly line
of said United States Postal Service a distance of 81.47 feet to a
point; thence N 14° 18' 49" E along the easterly line of said United
States Postal Service a distance of 114.29 feet to an iron pin situate
in the southwesterly line of New York State Route 17; thence S 32° 00'
31" E along the southwesterly line of New York State Route 17, a
distance of 358.93 feet to an iron pin; thence continuing along the
southwesterly line of New York state Route 17, S 38° 30' 04" E a
distance of 108.18 feet to the iron pin marking the place of beginning.
Said premises are set forth and shown as approximately 4.026 acres of
land designated as Parcel A (excluding Parcels A-1 and A-2) on a survey
map entitled "As-Built Survey of Lands of New York Inn, LLC, City of
Corning, Steuben County, New York" by Weiler Associates, dated December
27, 2001, designated Job No. 12462; [or (vii)]
(VIII) any such premises or businesses located on that certain plot,
piece or parcel of land, situate, lying and being in the Second Ward of
the City of Schenectady, on the Northerly side of Union Street, bounded
and described as follows: to wit; Beginning at the Southeasterly corner
of the lands lately owned by Elisha L. Freeman and now by Albert Shear;
and running from thence Easterly along the line of Union Street, 44 feet
to the lands now owned by or in the possession of James G. Van Vorst;
thence Northerly in a straight line along the last mentioned lands and
the lands of the late John Lake, 102 feet to the lands of one Miss Rodg-
ers; thence Westerly along the line of the last mentioned lands of said
Rodgers to the lands of the said Shear; and thence Southerly along the
lands of said Shear 101 feet, 6 inches to Union Street, the place of
beginning.
Also all that tract or parcel of land, with the buildings thereon,
situate in the City of Schenectady, County of Schenectady, and State of
New York, situate in the First, formerly the Second Ward of the said
City, on the Northerly side of Union Street, which was conveyed by
William Meeker and wife to Elisha L. Freeman by deed dated the second
day of December 1843, and recorded in the Clerk's Office of Schenectady
County on December 5, 1843, in Book V of Deeds at page 392, which lot in
said deed is bounded and described as follows: Beginning at a point in
the Northerly line of Union Street where it is intersected by the East-
erly line of property numbered 235 Union Street, which is hereby
conveyed, and running thence Northerly along the Easterly line of said
property, One Hundred Forty and Five-tenths (140.5) feet to a point
sixteen (16) feet Southerly from the Southerly line of the new garage
S. 2609--B 59 A. 3009--B
built upon land adjoining on the North; thence Westerly parallel with
said garage, Forty-six and Seven-tenths (46.7) feet; thence Southerly
One Hundred Forty and Eight-tenths (140.8) feet to the Northerly margin
of Union Street; thence Easterly along the Northerly margin of Union
Street, about Forty-eight and three-tenths (48.3) feet to the point or
place of beginning. The two above parcels are together more particular-
ly described as follows: All that parcel of land in the City of Sche-
nectady beginning at a point in the northerly margin of Union Street at
the southwesterly corner of lands now or formerly of Friedman (Deed Book
636 at page 423) which point is about 60 feet westerly of the westerly
line of North College Street and runs thence N. 86 deg. 42' 20" W. 92.30
feet to the southeasterly corner of other lands now or formerly of
Friedman (Deed Book 798 at page 498); thence N. 04 deg. 06' 48" E.
140.50 feet to the southwesterly corner of lands now or formerly of
Stockade Associates (Deed Book 1038 at page 521); thence S. 87 deg. 05'
27" E. 46.70 feet to lands now or formerly of McCarthy (Deed Book 1129
at page 281); thence along McCarthy S. 00 deg. 52' 02" E. 3.69 feet to
the northwesterly corner of lands now or formerly of SONYMA (Deed Book
1502 at page 621); thence along lands of SONYMA S. 02 deg 24' 56"
W.34.75 feet to a corner; thence still along lands of SONYMA and lands
now or formerly of Magee (Deed Book 399 at page 165) S. 86 deg. 11' 52"
E. 42.57 feet to a corner; thence still along lands of Magee and Lands
of Friedman first above mentioned S. 03 deg. 10' 08" W. 102.00 feet to
the point of beginning. Excepting and reserving all that portion of the
above parcel lying easterly of a line described as follows: All that
tract or parcel of land, situated in the City of Schenectady and County
of Schenectady and State of New York, on the Northerly side of Union
Street bounded and described as follows: Beginning at a point in the
northerly line of Union Street, said point being in the division line
between lands now or formerly of Electric Brew Pubs, Inc. (1506 of Deeds
at page 763) on the West and lands now or formerly of Margaret Wexler
and Donna Lee Wexler Pavlovic, as trustees under Will of Ruth F. Wexler
(Street number 241 Union Street) on the East; thence North 03 deg. 04'
10" East, along the building known as Street No. 241 Union Street, a
distance of 30.50 feet to a point; thence North 88 deg. 45' 45" West,
along said building and building eve, a distance of 5.62 feet to a
point; thence North 03 deg. 03' 30" East, along said building eve of
Street No. 241 Union Street, a distance of 32.74 feet; thence South 88
deg. 45' 45" East, along said building eve, a distance of 1.2 feet to an
intersection of building corner of Street No. 241 Union Street and a
brick wall; thence north 03 deg. 37' 30" East, along said brick wall, a
distance of 14.47 feet to a point in the corner of the brick wall,
thence South 86 deg. 46' 45" East along said brick wall a distance of
4.42 feet to the intersection of brick wall with the boundary line
between the Electric Brew Pubs, Inc. (aforesaid) on the West and lands
of Margaret Wexler and Donna Lee Wexler Pavlovic, (aforesaid) on the
East; thence North 03 deg 10' 08" East a distance of 0.62 feet to the
Northeast corner of lands belonging to Margaret Wexler and Donna Lee
Wexler Pavlovic. Also all that tract or parcel of land commonly known
as the Union Street School, located on the Northeasterly corner of Union
and North College Streets in the First Ward of the City and County of
Schenectady and State of New York, more particularly bounded and
described as follows: Beginning at a point in the Northerly street line
of Union Street where it is intersected by the Easterly street line of
North College Street, and runs thence Northerly along the Easterly
street line of North College Street, one hundred seven and five-tenths
S. 2609--B 60 A. 3009--B
(107.5) feet to a point, thence easterly at an angle of ninety (90)
degrees, one hundred ninety-one and seventy-five hundredths (191.75)
feet to a point in the Northwesterly street line of Erie Boulevard
thence southwesterly along the Northwesterly street line of Erie Boule-
vard, one hundred twenty-three and eight-tenths (123.8) feet to its
intersection with the Northerly street line of Union Street; thence
Westerly along the Northerly street line of Union Street, one hundred
twenty-four and fifty-five hundredths (124.55) feet to the point or
place of beginning.
The above described parcel of property includes the Blue Line parcel
of land, which is a portion of the abandoned Erie Canal Lands, located
in the First Ward of the City of Schenectady, New York, and which Blue
Line parcel lies between the Northwesterly line of Erie Boulevard as set
forth in the above described premises and the Northeasterly lot line of
the old Union Street School as it runs parallel with the Northwesterly
line of Erie Boulevard as aforesaid.
The two above parcels are together more particularly described as
follows: All that parcel of land in the City of Schenectady beginning at
a point in the northerly margin of Union Street and the northwesterly
margin of Erie Boulevard and runs thence along Union Street N. 86 deg.
42' 20" W. 124.55 feet to the easterly margin of North College Street;
thence along North College Street N. 05 deg 04' 40" E. 107.50 feet to
the southeasterly corner of lands now or formerly of McCarthy (Deed Book
1129 at page 279); thence along McCarthy, Cottage Alley and lands now or
formerly of McGregor (Deed Book 912 at page 624) S. 84 deg. 55' 20" E.
191.75 feet to the northwesterly margin of Erie Boulevard; thence along
Erie Boulevard S. 38 deg. 03' 53" W. 123.54 feet to the point of begin-
ning; [or (viii)]
(IX) any such premises or businesses located on that tract or parcel
of land situate in the Town of Hopewell, Ontario County, State of New
York, bounded and described as follows: Commencing at a 5/8" rebar found
on the division line between lands now or formerly of Ontario County -
Finger Lakes Community College (Liber 698 of Deeds, Page 466) on the
north and lands now or formerly of James W. Baird (Liber 768 of Deeds,
Page 1109) on the south; thence, North 43°-33'-40" West, on said divi-
sion line, a distance of 77.32 feet to the Point of Beginning. Thence,
North 43°-33'-40" West, continuing on said division line and through
said lands of Ontario County, a distance of 520.45 feet to a point on
the southeasterly edge of an existing concrete pad; thence, South
74°-19'-53" West, along said edge of concrete and the projection there-
of, a distance of 198.78 feet to a point on the easterly edge of pave-
ment of an existing campus drive; thence, the following two (2) courses
and distances along said edge of pavement: Northeasterly on a curve to
the left having a radius of 2221.65 feet, a chord bearing of North
30°-16'-39" East, a chord distance of 280.79, a central angle of
07°-14'-47", a length of 280.98 feet to a point of reverse curvature;
thence, Northeasterly on a curve to the right having a radius of 843.42
feet, a chord bearing of North 45°-25'-09" East, a chord distance of
534.08, a central angle of 36°-55'-01", a length of 543.43 feet to a
point; thence, South 30°-04'-59" East, a distance of 18.28 feet to the
corner of the property acquired by Ontario County (Liber 766 of Deeds,
Page 1112), as shown on a map recorded in the Ontario County Clerk's
Office as Map No. 6313; thence, the following four (4) courses and
distances along said property line: South 30°-04'-59" East, a distance
of 177.17 feet to a point; thence, South 02°-20'-33" East, a distance of
147.53 feet to a point; thence, South 41°-31'-35" East, a distance of
S. 2609--B 61 A. 3009--B
200.93 feet to a point; thence, South 23°-48'-53" West, along said prop-
erty line, and the projection thereof, through the first said lands of
Ontario County - Finger Lakes Community College (Liber 698 of Deeds,
Page 466), a distance of 517.96 feet to Point of Beginning. Said parcel
containing 7.834 acres, more or less, as shown on a map entitled
"Proposed Lease Area - Friends of the Finger Lakes Performing Arts
Center, Hopewell, NY", prepared by Bergmann Associates, drawing LM-01,
dated June 10, 2005, last revised August 17, 2005. The related PAC Prop-
erties are shown on the Map denominated "FLCC Campus Property, FLPAC
Ground Lease, Parking, Vehicular & Pedestrian Access", recorded in the
Ontario County Clerk's Office on December 10, 2009 in Book 1237 of Deeds
at page 9 and are comprised of the areas separately labeled as Parking
Lot 'A', Parking Lot 'G', the Ticket Booth area, the Sidewalks, and the
Entry Roads[.];
(X) ANY PREMISES LICENSED PURSUANT TO SECTION SIXTY-THREE-B OF THIS
CHAPTER.
[The provisions of this paragraph shall not apply to] (XI) any prem-
ises licensed under section sixty-four of this chapter in which a
manufacturer or wholesaler holds a direct or indirect interest, provided
that: [(I)] (1) said premises consist of an interactive entertainment
facility which predominantly offers interactive computer and video
entertainment attractions, and other games and also offers themed
merchandise and food and beverages, [(II)] (2) the sale of alcoholic
beverages within the premises shall be restricted to an area consisting
of not more than twenty-five percent of the total interior floor area of
the premises, [(III)] (3) the retail licenses shall derive not less than
sixty-five percent of the total revenue generated by the facility from
interactive video entertainment activities and other games, including
related attractions and sales of merchandise other than food and alco-
holic beverages, [(IV)] (4) the interested manufacturer or wholesaler,
or its parent company, shall be listed on a national securities exchange
and its direct or indirect equity interest in the retail licensee shall
not exceed twenty-five percent, [(V)] (5) no more than fifteen percent
of said licensee's purchases of alcoholic beverages for sale in the
premises shall be products produced or distributed by the manufacturer
or wholesaler, [(VI)] (6) neither the name of the manufacturer or whole-
saler nor the name of any brand of alcoholic beverage produced or
distributed by said manufacturer or wholesaler shall be part of the name
of the premises, [(VII)] (7) the name of the manufacturer or wholesaler
or the name of products sold or distributed by such manufacturer or
wholesaler shall not be identified on signage affixed to either the
interior or the exterior of the premises in any fashion, [(VIII)] (8)
promotions involving alcoholic beverages produced or distributed by the
manufacturer or wholesaler are not held in such premises and further,
retail and consumer advertising specialties bearing the name of the
manufacturer or wholesaler or the name of alcoholic beverages produced
or distributed by the manufacturer or wholesaler are not utilized in any
fashion, given away or sold in said premises, and [(IX)] (9) except to
the extent provided in this paragraph, the licensing of each premises
covered by this exception is subject to all provisions of section
sixty-four of this chapter, including but not limited to liquor authori-
ty approval of the specific location thereof.
The provisions of this paragraph shall not prohibit (1) a manufacturer
or wholesaler, if an individual, or a partner, of a partnership, or, if
a corporation, an officer or director thereof, from being an officer or
director of a duly licensed charitable organization which is the holder
S. 2609--B 62 A. 3009--B
of a license for on-premises consumption under this chapter, nor (2) a
manufacturer from acquiring any such premises if the liquor authority
first consents thereto after determining, upon such proofs as it shall
deem sufficient, that such premises is contiguous to the licensed prem-
ises of such manufacturer, and is reasonably necessary for the expansion
of the facilities of such manufacturer. After any such acquisition, it
shall be illegal for a manufacturer acquiring any such premises to sell
or deliver alcoholic beverages manufactured by him to any licensee occu-
pying such premises.
S 10. If any provision of this act or the application thereof shall
for any reason be finally adjudged by a court of competent jurisdiction
to be invalid or unconstitutional, such judgment shall not affect,
impair, or invalidate the remainder of this act but shall be confined in
its operation to the provision or provisions directly involved in the
controversy in which such judgment shall have been rendered. It is here-
by declared to be the intent of the legislature that this act would have
been enacted even if such invalid provision or provisions had not been
included. In the event that any provision of the laws of New York, as
amended by this act, shall be finally adjudged by a court of competent
jurisdiction to be invalid or unconstitutional, the provisions of such
laws in effect prior to the date this act shall have become law shall
not be affected by such judgment.
S 11. This act shall take effect immediately; provided, however, that
the sales tax exemptions created by sections three and four of this act
shall take effect on the first day of a sales tax quarterly period, as
described in subdivision (b) of section 1136 of the tax law, next
commencing at least 30 days after this act shall have become a law and
shall apply in accordance with the applicable transitional provisions in
sections 1106 and 1217 of the tax law; and provided further that the
amendments to subdivisions 1 and 2 of section 56-a of the alcoholic
beverage control law made by section eight of this act shall take effect
on the same date and in the same manner as sections 7 and 8, respective-
ly, of chapter 108 of the laws of 2012, as amended, take effect.
PART J
Section 1. The general municipal law is amended by adding a new
section 875 to read as follows:
S 875. SPECIAL PROVISIONS APPLICABLE TO STATE SALES AND COMPENSATING
USE TAXES AND CERTAIN TYPES OF FACILITIES. 1. FOR PURPOSES OF THIS
SECTION: "STATE SALES AND USE TAXES" MEANS SALES AND COMPENSATING USE
TAXES AND FEES IMPOSED BY ARTICLE TWENTY-EIGHT OR TWENTY-EIGHT-A OF THE
TAX LAW BUT EXCLUDING SUCH TAXES IMPOSED IN A CITY BY SECTION ELEVEN
HUNDRED SEVEN OR ELEVEN HUNDRED EIGHT OF SUCH ARTICLE TWENTY-EIGHT.
"IDA" MEANS AN INDUSTRIAL DEVELOPMENT AGENCY ESTABLISHED BY THIS ARTICLE
OR AN INDUSTRIAL DEVELOPMENT AUTHORITY CREATED BY THE PUBLIC AUTHORITIES
LAW. "COMMISSIONER" MEANS THE COMMISSIONER OF TAXATION AND FINANCE.
2. (A) AN IDA SHALL NOT PROVIDE STATE SALES AND USE TAX EXEMPTION
BENEFITS WITH RESPECT TO ANY PROJECT UNLESS AND UNTIL THE PREREQUISITES
SET FORTH IN PARAGRAPHS (B), (C), (D) AND (E) OF THIS SUBDIVISION ARE
MET.
(B) EITHER (I) THE AGENT OR PROJECT OPERATOR OF SUCH PROJECT MUST HAVE
BEEN CERTIFIED AS A PARTICIPANT IN THE EXCELSIOR JOBS PROGRAM, AS SUCH
TERM "PARTICIPANT" IS DEFINED IN SECTION THREE HUNDRED FIFTY-TWO OF THE
ECONOMIC DEVELOPMENT LAW, AND PROVIDES TO THE IDA VALID PROOF OF PARTIC-
IPATION IN SUCH PROGRAM, OR (II) IF SUCH AGENT OR PROJECT OPERATOR IS
S. 2609--B 63 A. 3009--B
NOT A PARTICIPANT IN SUCH PROGRAM, THE IDA, AFTER REVIEWING THE FACTS ON
THE RECORD, MUST FIND THAT THE AGENT OR PROJECT OPERATOR IS A BUSINESS
ENTITY OF THE TYPE DESCRIBED IN SUBDIVISION ONE OF SECTION THREE HUNDRED
FIFTY-THREE OF THE ECONOMIC DEVELOPMENT LAW AND REGULATIONS ADOPTED
PURSUANT TO SUCH SECTION.
(C) IF THE PREREQUISITE IN EITHER SUBPARAGRAPH (I) OR (II) OF PARA-
GRAPH (B) OF THIS SUBDIVISION HAS BEEN MET, THE IDA SHALL SUBMIT IN
WRITING ITS PLAN TO PROVIDE SUCH STATE SALES AND USE TAX EXEMPTION BENE-
FITS FOR SUCH PROJECT, TOGETHER WITH THE FINDINGS IT MADE UNDER SUCH
SUBPARAGRAPH (II) OF PARAGRAPH (B) TO THE COMMISSIONER OF ECONOMIC
DEVELOPMENT.
(D) THE COMMISSIONER OF ECONOMIC DEVELOPMENT SHALL REVIEW SUCH
PROPOSED STATE SALES AND USE TAX EXEMPTION BENEFIT PLAN FOR SUCH PROJECT
AND DETERMINE, IN CONSULTATION WITH THE REGIONAL ECONOMIC DEVELOPMENT
COUNCIL ESTABLISHED BY THE GOVERNOR THAT ENCOMPASSES THE JURISDICTION
FOR WHOSE BENEFIT THE IDA RECOMMENDING THE TAX EXEMPTION BENEFITS WAS
CREATED, WHETHER SUCH PROPOSED STATE SALES AND USE TAX EXEMPTION BENEFIT
PLAN FOR SUCH PROJECT IS CONSISTENT WITH REGIONAL ECONOMIC DEVELOPMENT
STRATEGIES.
(E) THE COMMISSIONER OF ECONOMIC DEVELOPMENT SHALL REVIEW THE IDA'S
FINDINGS, IF ANY, AND APPROVE OR DISAPPROVE THE PROPOSED BENEFITS OR
DENY THEM IF SUCH COMMISSIONER DOES NOT APPROVE SUCH IDA'S FINDINGS THAT
THE AGENT/PROJECT OPERATOR IS A BUSINESS ENTITY OF THE TYPE REQUIRED.
SUCH COMMISSIONER IS ALSO AUTHORIZED TO MODIFY THE IDA'S PROPOSED PLAN
BY REDUCING THE TOTAL AMOUNT OF ANY SUCH STATE SALES AND USE TAX
EXEMPTION BENEFITS OR BY SPECIFYING THAT SUCH BENEFITS SHALL APPLY TO
ONLY SOME OF THE TYPES OF PROPERTY OR SERVICES PROPOSED TO BE EXEMPT
FROM SUCH STATE TAXES OR BY REDUCING THE TIME PERIOD DURING WHICH SUCH
BENEFITS MAY BE PROVIDED. SUCH COMMISSIONER SHALL ADVISE THE IDA IN
WRITING OF HIS OR HER APPROVAL, DISAPPROVAL, DENIAL, OR MODIFICATION OF
THE IDA'S PLAN, AND SUCH APPROVAL, DISAPPROVAL, DENIAL, OR MODIFICATION
SHALL BIND THE IDA AS TO WHETHER THE IDA CAN PROVIDE STATE SALES AND USE
TAX EXEMPTION BENEFITS AND, IF APPROVED IN WHOLE OR AS MODIFIED, THE
AMOUNT OF STATE SALES AND USE TAX EXEMPTION BENEFITS THAT THE IDA CAN
PROVIDE WITH RESPECT TO SUCH PROJECT, THE TYPES OF PROPERTY AND SERVICES
THAT MAY BE ELIGIBLE FOR EXEMPTION, AND THE DURATION OF TIME DURING
WHICH SUCH EXEMPTION BENEFITS MAY APPLY. HOWEVER, THE IDA MAY PROVIDE
STATE SALES AND USE TAX EXEMPTION BENEFITS IN A LESSER AMOUNT, FOR FEWER
TYPES OF PROPERTY OR SERVICES, OR FOR A SHORTER PERIOD, THAN AS APPROVED
BY SUCH COMMISSIONER.
(F) NOTWITHSTANDING THE FOREGOING, IF AT THE TIME AN IDA PROPOSES A
STATE SALES AND USE TAX EXEMPTION BENEFIT PLAN THERE IS NO REGIONAL
ECONOMIC DEVELOPMENT COUNCIL IN THE APPLICABLE REGION, THEN THE COMMIS-
SIONER OF ECONOMIC DEVELOPMENT SHALL REVIEW SUCH PLAN AND ANY SUCH FIND-
INGS AS PROVIDED IN PARAGRAPH (D) OF THIS SUBDIVISION, WITHOUT REGARD TO
THE RECOMMENDATION OF ANY OTHER BODY.
(G) AN IDA SHALL NOT PROVIDE STATE SALES AND USE TAX EXEMPTION BENE-
FITS IN AN AMOUNT GREATER, FOR PROPERTY OR SERVICES OTHER, OR FOR A TIME
PERIOD LONGER THAN AS APPROVED BY THE COMMISSIONER OF ECONOMIC DEVELOP-
MENT. ANY AMOUNT OF STATE SALES AND USE TAX EXEMPTION BENEFITS THAT AN
IDA PURPORTS TO PROVIDE IN EXCESS OF THE AMOUNT APPROVED, OR FOR DIFFER-
ENT PROPERTY OR SERVICES THAN APPROVED, OR FOR A PERIOD LONGER THAN
APPROVED BY SUCH COMMISSIONER SHALL BE VOID FROM ITS INCEPTION, AND AN
AGENT, PROJECT OPERATOR, OR OTHER PERSON OR ENTITY THAT MAKES A PURCHASE
OR USE WITHOUT PAYING STATE SALES AND USE TAXES, OR WHO PAID SUCH TAXES
BUT OBTAINED A REFUND OR CREDIT OF THEM, AS A RESULT SHALL BE REQUIRED
S. 2609--B 64 A. 3009--B
TO PAY SUCH AMOUNT OF TAX TO THE COMMISSIONER OF TAXATION AND FINANCE IN
ACCORDANCE WITH ARTICLES TWENTY-EIGHT AND TWENTY-NINE OF THE TAX LAW.
THE COMMISSIONER SHALL BE AUTHORIZED TO DETERMINE AND ASSESS STATE SALES
AND USE TAXES FOREGONE ON ACCOUNT OF AN AGENT, PROJECT OPERATOR OR OTHER
PERSON OR ENTITY NOT HAVING PAID SUCH STATE SALES OR USE TAX THAT SHOULD
HAVE BEEN PAID, OR WHO OBTAINED SUCH A REFUND OR CREDIT BUT SHOULD NOT
HAVE, IN ACCORD WITH THE APPLICABLE PROVISIONS OF THE TAX LAW, EXCEPT
THAT ANY STATUTE THAT LIMITS THE TIME BY WHICH THE COMMISSIONER MUST
DETERMINE OR ASSESS SUCH TAX SHALL NOT BEGIN TO RUN UNTIL THE COMMIS-
SIONER HAS RECEIVED ACTUAL NOTICE OF SUCH IMPROPER PURCHASES OR USES.
3. AN IDA SHALL KEEP RECORDS OF THE AMOUNT OF STATE AND LOCAL SALES
AND USE TAX EXEMPTION BENEFITS PROVIDED TO EACH PROJECT AND EACH AGENT
OR PROJECT OPERATOR, AND SHALL MAKE SUCH RECORDS AVAILABLE TO THE
COMMISSIONER AND STATE COMPTROLLER UPON REQUEST. SUCH IDA SHALL ALSO,
WITHIN THIRTY DAYS OF PROVIDING FINANCIAL ASSISTANCE TO A PROJECT THAT
INCLUDES ANY AMOUNT OF STATE SALES AND USE TAX EXEMPTION BENEFITS,
REPORT TO THE COMMISSIONER AND THE STATE COMPTROLLER THE AMOUNT OF SUCH
BENEFITS FOR SUCH PROJECT, THE PROJECT TO WHICH THEY ARE BEING PROVIDED,
ANY LIMITATION ON THE APPLICATION OR EXERCISE OF SUCH EXEMPTIONS, THE
TYPES OF PROPERTY AND SERVICES TO BE EXEMPTED, THE TIME DURING WHICH
SUCH EXEMPTION BENEFITS APPLY, AND THE NAME AND ADDRESS OF THE AGENT OR
PROJECT OPERATOR OF SUCH PROJECT, TOGETHER WITH SUCH OTHER INFORMATION
AND SUCH SPECIFICITY AND DETAIL AS THE COMMISSIONER MAY PRESCRIBE, WITH
A COPY OF SUCH REPORT FURNISHED AT THE SAME TIME TO THE AGENT OR PROJECT
OPERATOR. THIS REPORT MAY BE MADE IN CONJUNCTION WITH THE STATEMENT
REQUIRED BY SUBDIVISION NINE OF SECTION EIGHT HUNDRED SEVENTY-FOUR OF
THIS ARTICLE OR IT MAY BE MADE AS A SEPARATE REPORT, AT THE DISCRETION
OF THE COMMISSIONER. AN AGENT OR PROJECT OPERATOR OR OTHER PERSON OR
ENTITY SHALL NOT AVAIL ITSELF OF STATE OR LOCAL SALES AND USE TAX
EXEMPTIONS IN EXCESS OF THE AMOUNT OR IN CONTRAVENTION OF THE TIME AND
OTHER LIMITATIONS SET OUT IN SUCH REPORT OR FOR PROPERTY OR SERVICES
OTHER THAN THOSE SET OUT IN SUCH REPORT. AN IDA THAT FAILS TO MAKE SUCH
RECORDS AVAILABLE TO THE COMMISSIONER OR TO THE STATE COMPTROLLER OR TO
FILE SUCH REPORT OR TO COMPLY WITH ANY OTHER REQUIREMENT OF THIS SUBDI-
VISION SHALL BE PROHIBITED FROM PROVIDING STATE SALES AND USE TAX
EXEMPTION BENEFITS FOR ANY PROJECT UNLESS AND UNTIL SUCH IDA COMES INTO
COMPLIANCE WITH ALL SUCH REQUIREMENTS.
4. NOTWITHSTANDING ANY PROVISION OF THIS SECTION OR OTHER LAW, IN NO
CASE SHALL AN IDA AGENT, PROJECT OPERATOR, OR OTHER PERSON OR ENTITY
TAKE ANY STATE SALES AND USE TAX EXEMPTION BENEFITS AS EXEMPTIONS AT THE
TIME OF PURCHASE OR USE. RATHER, IN ALL CASES, THE PERSON OR ENTITY
SHALL PAY STATE SALES OR USE TAX TO THE PERSON REQUIRED TO COLLECT IT AT
THE TIME OF PURCHASE OR TO THE COMMISSIONER IN ACCORD WITH THE REQUIRE-
MENTS OF ARTICLE TWENTY-EIGHT OF THE TAX LAW. AFTER HAVING PAID TAX TO
THE PERSON REQUIRED TO COLLECT IT OR TO THE COMMISSIONER, SUCH PERSON OR
ENTITY MAY THEN APPLY TO THE COMMISSIONER FOR A REFUND OR CREDIT OF SUCH
TAX ACTUALLY PAID. ANY SUCH REFUND OR CREDIT SHALL THEN BE APPLIED FOR
IN THE MANNER ESTABLISHED BY AND SUBJECT TO THE PROVISIONS OF SUCH ARTI-
CLE TWENTY-EIGHT.
5. NOTWITHSTANDING ANY PROVISION OF THIS SECTION OR OTHER LAW, AN IDA
SHALL NOT CREATE A PROJECT OR ANY PORTION OF A PROJECT, OR AUTHORIZE THE
USE OF ANY PROJECT OR PROJECT PROPERTY, OUTSIDE THIS STATE.
6. AN IDA THAT ENTERS INTO AN AGREEMENT REQUIRING PAYMENTS IN LIEU OF
STATE SALES AND USE TAXES TO BE PAID TO IT SHALL REMIT THE FULL AMOUNT
OF ANY SUCH PAYMENTS IT RECEIVES TO THE COMMISSIONER WITHIN THIRTY DAYS
OF THE DATE THAT THE IDA RECEIVES THE PAYMENT, TOGETHER WITH A RETURN OR
S. 2609--B 65 A. 3009--B
REPORT REQUIRED BY THE COMMISSIONER. THE IDA SHALL SEND A COPY OF ANY
SUCH AGREEMENT FOR PAYMENT IN LIEU OF SUCH TAXES TO THE COMMISSIONER
WITHIN THIRTY DAYS OF THE DATE IT IS EXECUTED. IF THE PERSON OR ENTITY
REQUIRED TO MAKE SUCH PAYMENTS TO THE IDA FAILS TO DO SO TIMELY, OR IF
THE IDA FAILS TO REMIT SUCH PAYMENTS TO THE COMMISSIONER TIMELY, THE
AMOUNT OF ANY SUCH UNTIMELY PAYMENTS OR REMISSIONS, TOGETHER WITH A
PENALTY OF FIVE PERCENT OF THE AMOUNT OF SUCH LATE PAYMENTS AND INTEREST
ON SUCH LATE PAYMENTS AT THE RATE OF ONE PERCENT PER MONTH, SHALL ALL
BE DEEMED TO BE SALES TAX WHICH A RETURN OR REPORT SHOWS TO BE DUE UNDER
SECTION ONE HUNDRED SEVENTY-THREE-A OF THE TAX LAW AND SUCH AMOUNTS
SHALL BE PAID UPON NOTICE AND DEMAND AND SHALL BE ASSESSED, COLLECTED,
AND PAID IN THE MANNER PROVIDED FOR SALES TAX, AND SUCH NOTICE AND
DEMAND SHALL NOT BE CONSIDERED AS A NOTICE OF DETERMINATION, AS
DESCRIBED IN SUCH SECTION ONE HUNDRED SEVENTY-THREE-A. AN IDA SHALL JOIN
THE COMMISSIONER AS A PARTY IN ANY ACTION OR PROCEEDING THAT THE IDA
COMMENCES TO RECOVER, OBTAIN, OR OTHERWISE SEEK, ANY UNPAID PAYMENTS IN
LIEU OF STATE SALES AND USE TAX FROM AN AGENT, PROJECT OPERATOR OR OTHER
PERSON OR ENTITY. THE PROVISIONS OF THIS SUBDIVISION SHALL ALSO APPLY TO
ANY INTEREST OR PENALTY THAT THE IDA IMPOSES ON ANY SUCH PAYMENTS IN
LIEU OF TAXES OR THAT ARE IMPOSED ON SUCH PAYMENTS BY OPERATION OF LAW
OR BY JUDICIAL ORDER OR OTHERWISE. ANY SUCH PAYMENTS, TOGETHER WITH ANY
INTEREST OR PENALTIES THEREON, SHALL BE DEEMED TO BE STATE SALES AND USE
TAXES AND THE IDA SHALL RECEIVE ANY SUCH PAYMENTS, WHETHER AS A RESULT
OF COURT ACTION OR OTHERWISE, AS TRUSTEE FOR AND ON ACCOUNT OF THE
STATE.
7. AN IDA OR IDA AGENT OR PROJECT OPERATOR SHALL NOT BE EXEMPT FROM
THE TAXES IMPOSED BY PARAGRAPH TEN OF SUBDIVISION (C) OF SECTION ELEVEN
HUNDRED FIVE OR BY ARTICLE TWENTY-EIGHT-A OR TWENTY-NINE-A OF THE TAX
LAW.
8. IF AN IDA RECOVERS, RECAPTURES, RECEIVES, OR OTHERWISE OBTAINS, ANY
AMOUNT OF STATE SALES AND USE TAX EXEMPTION BENEFITS FROM AN AGENT,
PROJECT OPERATOR OR OTHER PERSON OR ENTITY, THE IDA SHALL, WITHIN THIRTY
DAYS OF COMING INTO POSSESSION OF SUCH AMOUNT, REMIT IT TO THE COMMIS-
SIONER, TOGETHER WITH SUCH INFORMATION AND REPORT THAT THE COMMISSIONER
DEEMS NECESSARY TO ADMINISTER PAYMENT OVER OF SUCH AMOUNT. AN IDA SHALL
JOIN THE COMMISSIONER AS A PARTY IN ANY ACTION OR PROCEEDING THAT THE
IDA COMMENCES TO RECOVER, RECAPTURE, OBTAIN, OR OTHERWISE SEEK THE
RETURN OF, STATE SALES AND USE TAX EXEMPTION BENEFITS FROM AN AGENT,
PROJECT OPERATOR OR OTHER PERSON OR ENTITY. THIS SUBDIVISION SHALL
APPLY TO ANY AMOUNTS OF STATE SALES AND USE TAX EXEMPTION BENEFITS THAT
AN IDA RECOVERS, RECAPTURES, RECEIVES, OR OTHERWISE OBTAINS, REGARDLESS
OF WHETHER THE IDA OR THE AGENT, PROJECT OPERATOR OR OTHER PERSON OR
ENTITY CHARACTERIZES SUCH BENEFITS RECOVERED, RECAPTURED, RECEIVED, OR
OTHERWISE OBTAINED, AS A PENALTY OR LIQUIDATED OR CONTRACT DAMAGES OR
OTHERWISE. THE PROVISIONS OF THIS SUBDIVISION SHALL ALSO APPLY TO ANY
INTEREST OR PENALTY THAT THE IDA IMPOSES ON ANY SUCH AMOUNTS OR THAT ARE
IMPOSED ON SUCH AMOUNTS BY OPERATION OF LAW OR BY JUDICIAL ORDER OR
OTHERWISE. ANY SUCH AMOUNTS OR PAYMENTS THAT AN IDA RECOVERS, RECAP-
TURES, RECEIVES, OR OTHERWISE OBTAINS, TOGETHER WITH ANY INTEREST OR
PENALTIES THEREON, SHALL BE DEEMED TO BE STATE SALES AND USE TAXES AND
THE IDA SHALL RECEIVE ANY SUCH AMOUNTS OR PAYMENTS, WHETHER AS A RESULT
OF COURT ACTION OR OTHERWISE, AS TRUSTEE FOR AND ON ACCOUNT OF THE
STATE.
9. THE COMMISSIONER SHALL DEPOSIT AND DISPOSE OF ANY AMOUNT OF ANY
PAYMENTS OR MONEYS RECEIVED FROM OR PAID OVER BY AN IDA OR FROM OR BY
ANY PERSON OR ENTITY, OR RECEIVED PURSUANT TO AN ACTION OR PROCEEDING
S. 2609--B 66 A. 3009--B
COMMENCED BY AN IDA, TOGETHER WITH ANY INTEREST OR PENALTIES THEREON,
PURSUANT TO SUBDIVISION SIX OR EIGHT OF THIS SECTION, AS STATE SALES AND
USE TAXES IN ACCORD WITH THE PROVISIONS OF ARTICLE TWENTY-EIGHT OF THE
TAX LAW. THE AMOUNT OF ANY SUCH PAYMENTS OR MONEYS, TOGETHER WITH ANY
INTEREST OR PENALTIES THEREON, SHALL BE ATTRIBUTED TO THE TAXES IMPOSED
BY SECTIONS ELEVEN HUNDRED FIVE AND ELEVEN HUNDRED TEN, ON THE ONE HAND,
AND SECTION ELEVEN HUNDRED NINE OF THE TAX LAW, ON THE OTHER HAND, OR TO
ANY LIKE TAXES OR FEES IMPOSED BY SUCH ARTICLE, BASED ON THE PROPORTION
THAT THE RATES OF SUCH TAXES OR FEES BEAR TO EACH OTHER, UNLESS THERE IS
EVIDENCE TO SHOW THAT ONLY ONE OR THE OTHER OF SUCH TAXES OR FEES WAS
IMPOSED OR RECEIVED OR PAID OVER.
10. THE STATEMENT THAT AN IDA IS REQUIRED BY SUBDIVISION NINE OF
SECTION EIGHT HUNDRED SEVENTY-FOUR OF THIS ARTICLE TO FILE WITH THE
COMMISSIONER SHALL NOT BE CONSIDERED AN EXEMPTION OR OTHER CERTIFICATE
OR DOCUMENT UNDER ARTICLE TWENTY-EIGHT OR TWENTY-NINE OF THE TAX LAW.
THE IDA SHALL NOT REPRESENT TO ANY AGENT, PROJECT OPERATOR, OR OTHER
PERSON OR ENTITY THAT A COPY OF SUCH STATEMENT MAY SERVE AS A SALES OR
USE TAX EXEMPTION CERTIFICATE OR DOCUMENT. NO AGENT OR PROJECT OPERATOR
MAY TENDER A COPY OF SUCH STATEMENT TO ANY PERSON REQUIRED TO COLLECT
SALES OR USE TAXES AS THE BASIS TO MAKE ANY PURCHASE EXEMPT FROM TAX. NO
SUCH PERSON REQUIRED TO COLLECT SALES OR USE TAXES MAY ACCEPT SUCH A
STATEMENT IN LIEU OF COLLECTING ANY TAX REQUIRED TO BE COLLECTED. THE
CIVIL AND CRIMINAL PENALTIES FOR MISUSE OF A COPY OF SUCH STATEMENT AS
AN EXEMPTION CERTIFICATE OR DOCUMENT OR FOR FAILURE TO PAY OR COLLECT
TAX SHALL BE AS PROVIDED IN THE TAX LAW. IN ADDITION, THE USE BY AN IDA
OR AGENT, PROJECT OPERATOR, OR OTHER PERSON OR ENTITY OF SUCH STATEMENT,
OR THE IDA'S RECOMMENDATION OF THE USE OR TENDERING OF SUCH STATEMENT,
AS SUCH AN EXEMPTION CERTIFICATE OR DOCUMENT SHALL BE DEEMED TO BE,
UNDER ARTICLES TWENTY-EIGHT AND THIRTY-SEVEN OF THE TAX LAW, THE ISSU-
ANCE OF A FALSE OR FRAUDULENT EXEMPTION CERTIFICATE OR DOCUMENT WITH
INTENT TO EVADE TAX.
11. IN CONSULTATION WITH THE COMMISSIONER OF ECONOMIC DEVELOPMENT, THE
COMMISSIONER OF TAXATION AND FINANCE IS HEREBY AUTHORIZED TO ADOPT RULES
AND REGULATIONS AND TO ISSUE PUBLICATIONS AND OTHER GUIDANCE IMPLEMENT-
ING THE PROVISIONS OF THIS SECTION AND OF THE OTHER SECTIONS OF THIS
ARTICLE RELATING TO ANY STATE OR LOCAL TAX OR FEE, OR EXEMPTION OR
EXCLUSION THEREFROM, THAT THE COMMISSIONER ADMINISTERS AND THAT MAY BE
AFFECTED BY ANY PROVISION OF THIS ARTICLE, AND ANY SUCH RULES AND REGU-
LATIONS OF THE COMMISSIONER SHALL HAVE THE SAME FORCE AND EFFECT WITH
RESPECT TO SUCH TAXES AND FEES, OR AMOUNTS MEASURED IN RESPECT OF THEM,
AS IF THEY HAD BEEN ADOPTED BY THE COMMISSIONER PURSUANT TO THE AUTHORI-
TY OF THE TAX LAW.
12. TO THE EXTENT THAT A PROVISION OF THIS SECTION CONFLICTS WITH A
PROVISION OF ANY OTHER SECTION OF THIS ARTICLE, THE PROVISIONS OF THIS
SECTION SHALL CONTROL.
S 2. The public authorities law is amended by adding a new section
1963-b to read as follows:
S 1963-B. SPECIAL PROVISIONS APPLICABLE TO STATE SALES AND COMPENSAT-
ING USE TAXES AND CERTAIN TYPES OF FACILITIES. THE PROVISIONS OF SECTION
EIGHT HUNDRED SEVENTY-FIVE OF THE GENERAL MUNICIPAL LAW SHALL APPLY TO
THE PROVISIONS OF THIS TITLE AND TO THE AUTHORITY CREATED BY THIS TITLE
WITH THE SAME FORCE AND EFFECT AS IF THE PROVISIONS OF SUCH SECTION
EIGHT HUNDRED SEVENTY-FIVE HAD BEEN INCORPORATED IN FULL INTO THIS TITLE
AND HAD EXPRESSLY REFERRED TO THE PROVISIONS OF THIS TITLE AND TO SUCH
AUTHORITY, WITH SUCH CHANGES TO SUCH SECTION AS ARE NECESSARY TO REFER
S. 2609--B 67 A. 3009--B
TO THE PROVISIONS OF THIS TITLE AND TO THE AUTHORITY CREATED BY THIS
TITLE.
S 3. The public authorities law is amended by adding a new section
2326-a to read as follows:
S 2326-A. SPECIAL PROVISIONS APPLICABLE TO STATE SALES AND COMPENSAT-
ING USE TAXES AND CERTAIN TYPES OF FACILITIES. THE PROVISIONS OF SECTION
EIGHT HUNDRED SEVENTY-FIVE OF THE GENERAL MUNICIPAL LAW SHALL APPLY TO
THE PROVISIONS OF THIS TITLE AND TO THE AUTHORITY CREATED BY THIS TITLE
WITH THE SAME FORCE AND EFFECT AS IF THE PROVISIONS OF SUCH SECTION
EIGHT HUNDRED SEVENTY-FIVE HAD BEEN INCORPORATED IN FULL INTO THIS TITLE
AND HAD EXPRESSLY REFERRED TO THE PROVISIONS OF THIS TITLE AND TO SUCH
AUTHORITY, WITH SUCH CHANGES TO SUCH SECTION AS ARE NECESSARY TO REFER
TO THE PROVISIONS OF THIS TITLE AND TO THE AUTHORITY CREATED BY THIS
TITLE.
S 4. Subdivision 3 of section 810 of the general municipal law, as
amended by chapter 356 of the laws of 1993, is amended to read as
follows:
3. The term "local officer or employee" shall mean the heads (other
than local elected officials) of any agency, department, division, coun-
cil, board, commission, or bureau of a political subdivision and their
deputies and assistants, and the officers and employees of such agen-
cies, departments, divisions, boards, bureaus, commissions or councils
who hold policy-making positions, as annually determined by the appoint-
ing authority and set forth in a written instrument which shall be filed
with the appropriate body during the month of February; except that the
term "local officer or employee" shall not mean a judge, justice, offi-
cer or employee of the unified court system. Members, officers, and
employees of each industrial development agency and authority ESTAB-
LISHED BY THIS CHAPTER OR CREATED BY THE PUBLIC AUTHORITIES LAW shall be
deemed officers or employees of the county, city, village, or town for
whose benefit such agency or authority is established OR CREATED.
S 5. Subdivision 4 of section 854 of the general municipal law, as
amended by chapter 478 of the laws of 2011, is amended to read as
follows:
(4) "Project" - shall mean any land, any building or other improve-
ment, and all real and personal properties located within the state of
New York and within or outside or partially within and partially outside
the municipality for whose benefit the agency was created, including,
but not limited to, machinery, equipment and other facilities deemed
necessary or desirable in connection therewith, or incidental thereto,
whether or not now in existence or under construction, which shall be
suitable for manufacturing, warehousing, research, commercial or indus-
trial purposes or other economically sound purposes identified and
called for to implement a state designated urban cultural park manage-
ment plan as provided in title G of the parks, recreation and historic
preservation law and which may include or mean an industrial pollution
control facility, a recreation facility, educational or cultural facili-
ty, a horse racing facility, a railroad facility or an automobile racing
facility, provided, however, no agency shall use its funds OR PROVIDE
FINANCIAL ASSISTANCE in respect of any project wholly or partially
outside the municipality for whose benefit the agency was created with-
out the prior consent thereto by the governing body or bodies of all the
other municipalities in which a part or parts of the project is, or is
to be, located, AND SUCH PORTION OF THE PROJECT LOCATED OUTSIDE SUCH
MUNICIPALITY FOR WHOSE BENEFIT THE AGENCY WAS CREATED SHALL BE CONTIG-
UOUS WITH THE PORTION OF THE PROJECT INSIDE SUCH MUNICIPALITY.
S. 2609--B 68 A. 3009--B
S 6. Section 883 of the general municipal law, as added by chapter 356
of the laws of 1993, is amended to read as follows:
S 883. Conflicts of interest. All members, officers, and employees of
an agency or INDUSTRIAL DEVELOPMENT authority ESTABLISHED BY THIS CHAP-
TER OR CREATED BY THE PUBLIC AUTHORITIES LAW shall be subject to the
provisions of article eighteen of this chapter.
S 7. Subdivision 9 of section 874 of the general municipal law, as
added by section 1 of subpart C of part S of chapter 57 of the laws of
2010, is amended to read as follows:
(9) (A) Within thirty days of the date that the agency designates a
project operator or other person to act as agent of the agency for
purposes of providing financial assistance consisting of any sales and
compensating use tax exemption to such person, the agency shall file a
statement with the department of taxation and finance relating thereto,
on a form and in such manner as is prescribed by the commissioner of
taxation and finance, identifying each such agent so named by the agen-
cy, setting forth the taxpayer identification number of each such agent,
giving a brief description of the property and/or services intended to
be exempted from such taxes as a result of such appointment as agent,
indicating the agency's rough estimate of the value of the property
and/or services to which such appointment as agent relates, indicating
the date when such designation as agent became effective and indicating
the date upon which such designation as agent shall cease.
(B) WITHIN THIRTY DAYS OF THE DATE THAT THE AGENCY'S DESIGNATION
DESCRIBED IN PARAGRAPH (A) OF THIS SUBDIVISION HAS BEEN AMENDED, TERMI-
NATED, BEEN REVOKED, OR BECOME INVALID OR INEFFECTIVE FOR ANY REASON,
THE AGENCY SHALL FILE A STATEMENT WITH THE DEPARTMENT OF TAXATION AND
FINANCE RELATING THERETO, ON A FORM AND IN SUCH MANNER AS IS PRESCRIBED
BY THE COMMISSIONER OF TAXATION AND FINANCE, IDENTIFYING EACH SUCH AGENT
SO NAMED BY THE AGENCY IN THE ORIGINAL DESIGNATION AND SETTING FORTH THE
TAXPAYER IDENTIFICATION NUMBER AND OTHER IDENTIFYING INFORMATION OF EACH
SUCH AGENT, THE DATE AS OF WHICH THE ORIGINAL DESIGNATION WAS AMENDED,
TERMINATED, REVOKED, OR BECAME INVALID OR INEFFECTIVE AND THE REASON
THEREFOR, TOGETHER WITH A COPY OF THE ORIGINAL DESIGNATION.
S 8. Subdivision 4 of section 1963 of the public authorities law, as
added by section 2 of subpart C of part S of chapter 57 of the laws of
2010, is amended to read as follows;
4. (A) Within thirty days of the date that the authority designates a
project operator or other person to act as agent of the authority for
purposes of providing financial assistance consisting of any sales and
compensating use tax exemption to such person, the agency shall file a
statement with the department of taxation and finance relating thereto,
on a form and in such manner as is prescribed by the commissioner of
taxation and finance, identifying each such agent so named by the
authority, setting forth the taxpayer identification number of each such
agent, giving a brief description of the property and/or services
intended to be exempted from such taxes as a result of such appointment
as agent, indicating the authority's rough estimate of the value of the
property and/or services to which such appointment as agent relates,
indicating the date when such designation as agent became effective and
indicating the date upon which such designation as agent shall cease.
(B) WITHIN THIRTY DAYS OF THE DATE THAT THE AUTHORITY'S DESIGNATION
DESCRIBED IN PARAGRAPH (A) OF THIS SUBDIVISION HAS BEEN AMENDED, TERMI-
NATED, BEEN REVOKED, OR BECOME INVALID OR INEFFECTIVE FOR ANY REASON,
THE AUTHORITY SHALL FILE A STATEMENT WITH THE DEPARTMENT OF TAXATION AND
FINANCE RELATING THERETO, ON A FORM AND IN SUCH MANNER AS IS PRESCRIBED
S. 2609--B 69 A. 3009--B
BY THE COMMISSIONER OF TAXATION AND FINANCE, IDENTIFYING EACH SUCH AGENT
SO NAMED BY THE AUTHORITY IN THE ORIGINAL DESIGNATION AND SETTING FORTH
THE TAXPAYER IDENTIFICATION NUMBER AND OTHER IDENTIFYING INFORMATION OF
EACH SUCH AGENT, THE DATE AS OF WHICH THE ORIGINAL DESIGNATION WAS
AMENDED, TERMINATED, REVOKED, OR BECAME INVALID OR INEFFECTIVE AND THE
REASON THEREFOR, TOGETHER WITH A COPY OF THE ORIGINAL DESIGNATION.
S 9. Subdivision 4 of section 2326 of the public authorities law, as
added by section 3 of subpart C of part S of chapter 57 of the laws of
2010, is amended to read as follows:
4. (A) Within thirty days of the date that the authority designates a
project operator or other person to act as agent of the authority for
purposes of providing financial assistance consisting of any sales and
compensating use tax exemption to such person, the agency shall file a
statement with the department of taxation and finance relating thereto,
on a form and in such manner as is prescribed by the commissioner of
taxation and finance, identifying each such agent so named by the
authority, setting forth the taxpayer identification number of each such
agent, giving a brief description of the property and/or services
intended to be exempted from such taxes as a result of such appointment
as agent, indicating the authority's rough estimate of the value of the
property and/or services to which such appointment as agent relates,
indicating the date when such designation as agent became effective and
indicating the date upon which such designation as agent shall cease.
(B) WITHIN THIRTY DAYS OF THE DATE THAT THE AUTHORITY'S DESIGNATION
DESCRIBED IN PARAGRAPH (A) OF THIS SUBDIVISION HAS BEEN AMENDED, TERMI-
NATED, BEEN REVOKED, OR BECOME INVALID OR INEFFECTIVE FOR ANY REASON,
THE AUTHORITY SHALL FILE A STATEMENT WITH THE DEPARTMENT OF TAXATION AND
FINANCE RELATING THERETO, ON A FORM AND IN SUCH MANNER AS IS PRESCRIBED
BY THE COMMISSIONER OF TAXATION AND FINANCE, IDENTIFYING EACH SUCH AGENT
SO NAMED BY THE AUTHORITY IN THE ORIGINAL DESIGNATION AND SETTING FORTH
THE TAXPAYER IDENTIFICATION NUMBER AND OTHER IDENTIFYING INFORMATION OF
EACH SUCH AGENT, THE DATE AS OF WHICH THE ORIGINAL DESIGNATION WAS
AMENDED, TERMINATED, REVOKED, OR BECAME INVALID OR INEFFECTIVE AND THE
REASON THEREFOR, TOGETHER WITH A COPY OF THE ORIGINAL DESIGNATION.
S 10. Severability. If any provision of this act shall for any reason
be finally adjudged by any court of competent jurisdiction to be inval-
id, such judgment shall not affect, impair, or invalidate the remainder
of this act, but shall be confined in its operation to the provision
directly involved in the controversy in which such judgment shall have
been rendered. It is hereby declared to be the intent of the legislature
that this act would have been enacted even if such invalid provision had
not been included in this act.
S 11. This act shall take effect immediately and shall apply to (a)
any project established, agent or project operator appointed, financial
assistance provided, and agreement regarding payments in lieu of taxes
entered into, on or after the date this act shall have become a law, (b)
any amendment or revision made on or after the date this act shall have
become a law to any project established, agent or project operator
appointed, financial assistance provided, or payment in lieu of taxes
entered into, prior to that date, (c) any state sales and compensating
use tax exemption benefits recovered, recaptured, received, or otherwise
obtained by an industrial development agency or authority established by
the general municipal law or created by the public authorities law on or
after such date, and (d) any payments in lieu of state sales and compen-
sating use taxes of such an industrial development agency or authority
receives on or after such date.
S. 2609--B 70 A. 3009--B
PART K
Section 1. Paragraph 42 of subdivision (a) of section 1115 of the tax
law, as added by section 11 of part W-1 of chapter 109 of the laws of
2006, is amended to read as follows:
(42) E85, CNG or hydrogen, for use or consumption directly and exclu-
sively in the engine of a motor vehicle AND NATURAL GAS PURCHASED AND
CONVERTED INTO CNG, FOR USE OR FOR SALE FOR USE OR CONSUMPTION DIRECTLY
AND EXCLUSIVELY IN THE ENGINE OF A MOTOR VEHICLE.
S 2. This act shall take effect on the first day of a sales tax quar-
terly period, as described in subdivision (b) of section 1136 of the tax
law, next commencing after this act shall have become a law and shall
apply in accordance with the applicable transitional provisions in
sections 1106 and 1217 of the tax law; provided, however, that the
amendments to paragraph 42 of subdivision (a) of section 1115 of the tax
law made by section one of this act shall not affect the repeal of such
paragraph and shall be deemed repealed therewith.
PART L
Section 1. Section 301-c of the tax law is amended by adding a new
subdivision (p) to read as follows:
(P) REIMBURSEMENT FOR MOTOR FUEL AND DIESEL MOTOR FUEL USED BY A
VOLUNTARY AMBULANCE SERVICE, AS DEFINED IN SECTION THREE THOUSAND ONE OF
THE PUBLIC HEALTH LAW, A FIRE COMPANY OR A FIRE DEPARTMENT, AS DEFINED
IN SECTION THREE OF THE VOLUNTEER FIREFIGHTERS' BENEFIT LAW, OR A VOLUN-
TEER RESCUE SQUAD SUPPORTED IN WHOLE OR IN PART BY TAX MONIES, WHERE ANY
SUCH ENTITY IS THE PURCHASER, USER OR CONSUMER OF MOTOR FUEL OR DIESEL
MOTOR FUEL IN A VEHICLE OWNED AND OPERATED BY SUCH ENTITY AND USED
EXCLUSIVELY FOR SUCH ENTITY'S PURPOSES. A PURCHASER SHALL BE ELIGIBLE
FOR REIMBURSEMENT OF THE TAX IMPOSED PURSUANT TO THIS ARTICLE IF (1) ANY
TAX IMPOSED PURSUANT TO THIS ARTICLE HAS BEEN PAID WITH RESPECT TO SUCH
GALLONAGE AND THE ENTIRE AMOUNT OF SUCH TAX HAS BEEN ABSORBED BY SUCH
PURCHASER, AND (2) SUCH PURCHASER POSSESSES DOCUMENTARY PROOF SATISFAC-
TORY TO THE COMMISSIONER EVIDENCING THE ABSORPTION BY SUCH PURCHASER OF
THE ENTIRE AMOUNT OF SUCH TAX. PROVIDED, THAT THE COMMISSIONER SHALL
REQUIRE SUCH DOCUMENTARY PROOF TO QUALIFY FOR ANY REIMBURSEMENT PROVIDED
HEREUNDER AS THE COMMISSIONER DEEMS APPROPRIATE.
S 2. This act shall take effect on the first day of the first month
next succeeding the sixtieth day after it shall have become a law.
PART M
Section 1. Subparagraphs (A) and (B) of paragraph 4 of subdivision (a)
of section 1134 of the tax law, subparagraph (A) as amended by section
21-a of part U of chapter 61 of the laws of 2011 and subparagraph (B) as
amended by chapter 2 of the laws of 1995, are amended to read as
follows:
(A) Where a person who holds a certificate of authority (i) willfully
fails to file a report or return required by this article, (ii) willful-
ly files, causes to be filed, gives or causes to be given a report,
return, certificate or affidavit required under this article which is
false, (iii) willfully fails to comply with the provisions of paragraph
two or three of subdivision (e) of section eleven hundred thirty-seven
of this article, (iv) willfully fails to prepay, collect, truthfully
account for or pay over any tax imposed under this article or pursuant
S. 2609--B 71 A. 3009--B
to the authority of article twenty-nine of this chapter, (v) fails to
obtain a bond pursuant to paragraph two of subdivision (e) of section
eleven hundred thirty-seven of this part, or fails to comply with a
notice issued by the commissioner pursuant to paragraph three of such
subdivision, [or] (vi) has been convicted of a crime provided for in
this chapter, OR UNDER THE PENAL LAW OF THIS STATE WHERE THE UNDERLYING
CONDUCT CONSTITUTES A CRIME UNDER THIS CHAPTER, OR IS CONVICTED OF A
CRIMINAL OFFENSE OF THE UNITED STATES, ANY OTHER STATE, OR A POLITICAL
SUBDIVISION OF THIS STATE OR ANY OTHER STATE, WHICH, IF COMMITTED IN
THIS STATE, WOULD CONSTITUTE A SIMILAR CRIME UNDER THIS CHAPTER OR (VII)
SUCH PERSON WOULD BE INELIGIBLE TO RECEIVE SUCH CERTIFICATE OF AUTHORITY
PURSUANT TO CLAUSES (I), (II), (IV) OR (V) OF SUBPARAGRAPH (B) OF THIS
PARAGRAPH, the commissioner may revoke or suspend such certificate of
authority and all duplicates thereof. Provided, however, that the
commissioner may revoke or suspend a certificate of authority based on
the grounds set forth in clause (vi) of this subparagraph only where the
conviction referred to occurred not more than [one year] FIVE YEARS
prior to the date of revocation or suspension.
(B) Where a person files a certificate of registration for a certif-
icate of authority under this subdivision and in considering such appli-
cation the commissioner ascertains that (i) any tax imposed under this
chapter or any related statute, as defined in section eighteen hundred
of this chapter, has been finally determined to be due from such person
and has not been paid in full, (ii) [a] ANY tax [due under this article
or any law, ordinance or resolution enacted pursuant to the authority of
article twenty-nine] IMPOSED BY OR PURSUANT TO THE AUTHORITY OF THIS
CHAPTER OR ANY RELATED STATUTE AS DEFINED IN SECTION EIGHTEEN HUNDRED of
this chapter has been finally determined to be due from an officer,
director, partner or employee of such person, and, where such person is
a limited liability company, also a member or manager of such person, in
the officer's, director's, partner's, member's, manager's or employee's
capacity as a person required to collect tax on behalf of such person or
another person and has not been paid, (iii) such person has been
convicted of a crime provided for in this chapter, OR UNDER THE PENAL
LAW OF THIS STATE WHERE THE UNDERLYING CONDUCT CONSTITUTES A CRIME UNDER
THIS CHAPTER, OR IS CONVICTED OF A CRIMINAL OFFENSE OF THE UNITED
STATES, ANY OTHER STATE, OR A POLITICAL SUBDIVISION OF THIS STATE OR ANY
OTHER STATE, WHICH, IF COMMITTED IN THIS STATE, WOULD CONSTITUTE A SIMI-
LAR CRIME UNDER THIS CHAPTER within [one year] FIVE YEARS from the date
on which such certificate of registration is filed, (iv) an officer,
director, partner or employee of such person, and, where such person is
a limited liability company, also a member or manager of such person,
which officer, director, partner, member, manager or employee is a
person required to collect tax on behalf of such person filing a certif-
icate of registration has in the officer's, director's, partner's,
member's, manager's or employee's capacity as a person required to
collect tax on behalf of such person or of another person been convicted
of a crime [provided for in this chapter] SET FORTH IN CLAUSE (III) OF
THIS SUBPARAGRAPH WHERE THE CONVICTION REFERRED TO OCCURRED within [one
year] FIVE YEARS from the date on which such certificate of registration
is filed, (v) a shareholder owning more than fifty percent of the number
of shares of stock of such person (where such person is a corporation)
entitling the holder thereof to vote for the election of directors or
trustees, OR A PERSON HAVING MORE THAN FIFTY PERCENT OF THE VOTING
RIGHTS OF SUCH PERSON (WHERE SUCH PERSON IS A LIMITED LIABILITY COMPA-
NY), OR A PERSON HAVING A CONTROLLING INTEREST IN ANY FORM OF PARTNER-
S. 2609--B 72 A. 3009--B
SHIP (CONTROLLING INTEREST MEANING MORE THAN FIFTY PERCENT OF THE CAPI-
TAL, PROFITS OR BENEFICIAL INTEREST IN SUCH PARTNERSHIP) who owned more
than fifty percent of the number of such shares of another person (where
such other person is a corporation), OR HAD MORE THAN FIFTY PERCENT OF
THE VOTING RIGHTS OF A LIMITED LIABILITY COMPANY, OR HAD CONTROLLING
INTEREST IN ANY FORM OF PARTNERSHIP (CONTROLLING INTEREST MEANING MORE
THAN FIFTY PERCENT OF THE CAPITAL, PROFITS OR BENEFICIAL INTEREST IN
SUCH PARTNERSHIP) at the time any tax imposed under this chapter or any
related statute as defined in section eighteen hundred of this chapter
was finally determined to be due FROM SUCH CORPORATION, PARTNERSHIP OR
LIMITED LIABILITY COMPANY and where such tax has not been paid in full,
or at the time such other person was convicted of a crime [provided for
in this chapter] SET FORTH IN CLAUSE (III) OF THIS SUBPARAGRAPH WHERE
THE CONVICTION REFERRED TO OCCURRED within [one year] FIVE YEARS from
the date on which such certificate of registration is filed, [or] (vi) a
certificate of authority issued to such person has been revoked or
suspended pursuant to subparagraph (A) of this paragraph within [one
year] THREE YEARS from the date on which such certificate of registra-
tion is filed, (VII) A CERTIFICATE OF AUTHORITY ISSUED TO ANY OTHER
PERSON HAS BEEN REVOKED OR SUSPENDED PURSUANT TO SUBPARAGRAPH (A) OF
THIS PARAGRAPH WITHIN THREE YEARS FROM THE DATE ON WHICH SUCH CERTIF-
ICATE OF REGISTRATION IS FILED AND AN OFFICER, DIRECTOR, MEMBER, MANAG-
ER, PARTNER OR EMPLOYEE OF SUCH PERSON WAS, AT THAT TIME OF SUCH REVOCA-
TION, A PERSON REQUIRED TO COLLECT TAX ON BEHALF OF SUCH PERSON AND SUCH
OFFICER, DIRECTOR, MEMBER, MANAGER, PARTNER OR EMPLOYEE IS A PERSON
REQUIRED TO COLLECT TAX ON BEHALF OF THE PERSON FILING A CERTIFICATE OF
REGISTRATION, OR (VIII) SUCH PERSON HAS COMMITTED AN ACT WHICH WOULD
GIVE THE COMMISSIONER THE AUTHORITY TO REVOKE OR SUSPEND SUCH CERTIF-
ICATE PURSUANT TO CLAUSE (I), (II), (III), (IV), OR (V) OF SUBPARAGRAPH
(A) OF THIS PARAGRAPH, the commissioner may refuse to issue a certif-
icate of authority.
S 2. Subparagraph (A) of paragraph 4 of subdivision (a) of section
1134 of the tax law, as amended by chapter 2 of the laws of 1995, is
amended to read as follows:
(A) Where a person who holds a certificate of authority (i) willfully
fails to file a report or return required by this article, (ii) willful-
ly files, causes to be filed, gives or causes to be given a report,
return, certificate or affidavit required under this article which is
false, (iii) willfully fails to comply with the provisions of paragraph
two or three of subdivision (e) of section eleven hundred thirty-seven
of this article, (iv) willfully fails to prepay, collect, truthfully
account for or pay over any tax imposed under this article or pursuant
to the authority of article twenty-nine of this chapter, [or] (v) has
been convicted of a crime provided for in this chapter, OR UNDER THE
PENAL LAW OF THIS STATE WHERE THE UNDERLYING CONDUCT CONSTITUTES A CRIME
UNDER THIS CHAPTER, OR IS CONVICTED OF A CRIMINAL OFFENSE OF THE UNITED
STATES, ANY OTHER STATE, OR A POLITICAL SUBDIVISION OF THIS STATE OR ANY
OTHER STATE, WHICH, IF COMMITTED IN THIS STATE, WOULD CONSTITUTE A SIMI-
LAR CRIME UNDER THIS CHAPTER, OR (VI) SUCH PERSON WOULD BE INELIGIBLE TO
RECEIVE SUCH CERTIFICATE OF AUTHORITY PURSUANT TO CLAUSES (I), (II),
(IV) OR (V) OF SUBPARAGRAPH (B) OF THIS PARAGRAPH, the commissioner may
revoke or suspend such certificate of authority and all duplicates ther-
eof. Provided, however, that the commissioner may revoke or suspend a
certificate of authority based on the grounds set forth in clause (v) of
this subparagraph only where the conviction referred to occurred not
S. 2609--B 73 A. 3009--B
more than [one year] FIVE YEARS prior to the date of revocation or
suspension.
S 3. Subparagraphs (C) and (E) of paragraph 4 and paragraph 5 of
subdivision (a) of section 1134 of the tax law, as amended by chapter 2
of the laws of 1995, are amended to read as follows:
(C) In any of the foregoing instances where the commissioner may
suspend or revoke or refuse to issue a certificate of authority, the
commissioner may condition the retention or issuance of a certificate of
authority upon (I) the filing of a bond [or], (II) the deposit of tax in
the manner provided in paragraph two or three of subdivision (e) of
section eleven hundred thirty-seven OF THIS PART, (III) NOTWITHSTANDING
PARAGRAPH TWO OF SUBDIVISION (A) OF THIS SECTION, THE ISSUANCE OF SUCH
CERTIFICATE FOR A SPECIFIED TERM OF LESS THAN THREE YEARS, (IV) THE
FILING OF PART-QUARTERLY RETURNS PURSUANT TO PARAGRAPH TWO OF SUBDIVI-
SION (A) OF SECTION ELEVEN HUNDRED THIRTY-SIX OF THIS PART, (V) THE
FILING OF ANY UNFILED RETURNS, (VI) ENTERING INTO AN INSTALLMENT PAYMENT
AGREEMENT OR OTHERWISE MAKING PAYMENT ARRANGEMENTS SATISFACTORY TO THE
COMMISSIONER, AND/OR (VII) SUCH OTHER TERMS AS THE COMMISSIONER AND
APPLICANT MAY AGREE TO.
(E) After the commissioner has suspended or revoked a person's certif-
icate of authority, by a notice of suspension or revocation, or has
refused to issue a certificate of authority, by a notice of refusal, to
such person and such decision has become final as provided for in this
paragraph, or after a person's certificate of authority has expired, OR
A PERSON WAS NOTIFIED THAT SUCH PERSON'S CERTIFICATE OF AUTHORITY WAS
DEEMED TO EXPIRE PURSUANT TO PARAGRAPH FIVE OF SUBDIVISION (A) OF THIS
SECTION and such person has failed to renew such certificate or obtain a
new certificate of authority, OR WHERE A PERSON REQUIRED TO COLLECT TAX
HAS FAILED TO APPLY FOR SUCH CERTIFICATE OF AUTHORITY, ANY such person
is prohibited from engaging in any business in this state for which a
certificate of authority is required. If despite such prohibition such
person continues to be so engaged in business, the commissioner may
bring an action to enjoin such person from so engaging in business. NO
SUCH ACTION SHALL BE INSTITUTED BY THE COMMISSIONER BEFORE THE COMMIS-
SIONER GIVES NOTICE TO THE ATTORNEY GENERAL APPRISING HIM OR HER OF SUCH
ACTION AND THE NATURE AND PURPOSE THEREOF, SO THAT THE ATTORNEY GENERAL
MAY PARTICIPATE OR JOIN THEREIN IF IN HIS OR HER OPINION THE INTERESTS
OF THE STATE SO WARRANT, AND THE COMMISSIONER MAY NOT INSTITUTE SUCH
ACTION UNTIL TWO WEEKS AFTER PROVIDING SUCH NOTICE TO THE ATTORNEY
GENERAL.
(5) If the commissioner considers it necessary for the proper adminis-
tration of the sales and use taxes and prepaid taxes imposed by this
article and pursuant to the authority of article twenty-nine of this
chapter, it may require every person under this section or section
twelve hundred fifty-three of this chapter who holds a certificate of
authority to file a new certificate of registration in such form and at
such time as the commissioner may prescribe and to surrender such
certificate of authority. The commissioner may require such filing and
such surrender not more often than once every three years; HOWEVER, IN
ANY INSTANCE WHERE A HOLDER OF A CERTIFICATE OF AUTHORITY HAS FAILED TO
FILE A SALES TAX RETURN AS REQUIRED BY THIS CHAPTER FOR A PERIOD OF AT
LEAST ONE YEAR SUCH CERTIFICATE SHALL BE DEEMED EXPIRED AND THE COMMIS-
SIONER SHALL REQUIRE A NEW CERTIFICATE OF REGISTRATION PURSUANT TO THIS
SUBDIVISION. Upon the filing of such certificate of registration and, TO
THE EXTENT REQUIRED BY THE COMMISSIONER, the surrender of such certif-
icate of authority, the commissioner shall issue, within such time as
S. 2609--B 74 A. 3009--B
the commissioner may prescribe, a new certificate of authority, without
charge, to each registrant and a duplicate thereof for each additional
place of business of such registrant.
S 4. Subparagraph (i) of paragraph 3 of subdivision (a) of section
1145 of the tax law, as amended by section 48 of part K of chapter 61 of
the laws of 2011, is amended to read as follows:
(i) Any person required to obtain a certificate of authority under
section eleven hundred thirty-four of this part who, without possessing
a valid certificate of authority, (A) sells tangible personal property
or services subject to tax, receives amusement charges or operates a
hotel, (B) purchases or sells tangible personal property for resale, (C)
sells petroleum products, or (D) sells cigarettes shall, in addition to
any other penalty imposed by this chapter, be subject to a penalty in an
amount [not exceeding] OF five hundred dollars [for the first] A day
FROM THE FIRST DAY on which such sales or purchases are made, [plus an
amount not exceeding two hundred dollars for each subsequent day on
which such sales or purchases are made,] not to exceed [ten] TWENTY
thousand dollars in the aggregate. THE WILLFUL FAILURE TO OBTAIN OR
MAINTAIN A VALID CERTIFICATE OF AUTHORITY SHALL BE SUBJECT TO A PENALTY
IN AN AMOUNT OF ONE THOUSAND DOLLARS A DAY FROM THE FIRST DAY SUCH SALES
OR PURCHASES ARE MADE, NOT TO EXCEED FIFTY THOUSAND DOLLARS IN THE
AGGREGATE, IN ADDITION TO THE PENALTIES IMPOSED BY SUBDIVISION (B) OF
SECTION EIGHTEEN HUNDRED SEVENTEEN OF THIS ARTICLE, OR ANY OTHER PENALTY
IMPOSED BY THIS CHAPTER. FOR THE PURPOSES OF THIS SECTION, THE PENALTY
FOR THE WILLFUL FAILURE TO OBTAIN OR MAINTAIN A VALID CERTIFICATE OF
AUTHORITY SHALL BE ALTERNATE TO THE TWENTY THOUSAND DOLLAR PENALTY
DESCRIBED ABOVE, AND THE TERM "WILLFUL" SHALL HAVE THE SAME MEANING AS
"WILLFULLY" AS DEFINED IN SUBDIVISION (C) OF SECTION EIGHTEEN HUNDRED
ONE OF THIS CHAPTER.
S 5. Subparagraphs (ii), (iii) and (iv) of paragraph 3 of subdivision
(a) of section 1145 of the tax law, as amended by chapter 65 of the laws
of 1985, are amended to read as follows:
(ii) Any person who fails to surrender a certificate of authority when
a notice of revocation, EXPIRATION or suspension has become final shall,
in addition to any other penalty imposed by this chapter, be subject to
a penalty in an amount not exceeding five hundred dollars [for the first
day of such failure, together with a penalty in an amount not exceeding
two hundred dollars for each subsequent] A day [of] FOR such failure,
not to exceed [ten] TWENTY thousand dollars in the aggregate.
(iii) Any person described in paragraph one or two of subdivision (a)
of section eleven hundred thirty-four OF THIS PART who takes possession
of or pays for business assets under circumstances requiring notifica-
tion by such person to the [tax commission] COMMISSIONER pursuant to
subdivision (c) of section eleven hundred forty-one OF THIS PART without
having filed a certificate of registration pursuant to section eleven
hundred thirty-four OF THIS PART shall, in addition to any other penalty
imposed by this chapter, be subject to a penalty in an amount not
exceeding two [hundred] THOUSAND dollars.
(iv) If the [tax commission] COMMISSIONER determines that any failure
or act described in this paragraph was due to reasonable cause and not
due to willful neglect, [it] HE OR SHE may remit all or part of such
penalty. PROVIDED, HOWEVER, THIS CLAUSE SHALL NOT APPLY TO A PENALTY FOR
THE WILLFUL FAILURE TO OBTAIN A CERTIFICATE OF AUTHORITY.
S 6. Paragraph 4 of subdivision (a) of section 1145 of the tax law, as
amended by chapter 65 of the laws of 1985, is amended to read as
follows:
S. 2609--B 75 A. 3009--B
(4) Any person required by this article to display a certificate of
authority, who fails to display such certificate in the manner required
by this article or any rule or regulation adopted by the [tax commis-
sion] COMMISSIONER in connection with such requirement shall, in addi-
tion to any other penalty imposed by this chapter, be subject to a
penalty of [fifty] ONE HUNDRED dollars. If the [tax commission] COMMIS-
SIONER determines that such failure was due to reasonable cause [and not
due to willful neglect], [it] HE OR SHE may remit all or part of such
penalty.
S 7. Subdivision (g) of section 1146 of the tax law, as added by chap-
ter 577 of the laws of 1997, is amended to read as follows:
(g) (1) Notwithstanding the provisions of subdivision (a) of this
section, if the commissioner determines that a person required to
collect tax is liable for any tax, penalty or interest under this arti-
cle or is liable for a penalty under subdivision (e) of section eleven
hundred forty-five of this [article] PART with respect to any failure,
upon request in writing of such person, the commissioner shall disclose
in writing to such person [(1)] (I) the name of any other person
required to collect tax or any other person liable for such penalty
under such subdivision (e) whom the commissioner has determined to be
liable for the same tax, penalty or interest or for such penalty with
respect to such failure, and [(2)] (II) whether the commissioner has
attempted to collect such tax, penalty or interest or such penalty from
such other person, the general nature of such collection activities, and
the amount collected.
(2) NOTWITHSTANDING ANY PROVISION OF THIS CHAPTER TO THE CONTRARY, FOR
THE PURPOSES OF SUBPARAGRAPH (B) OF PARAGRAPH FOUR OF SUBDIVISION (A) OF
SECTION ELEVEN HUNDRED THIRTY-FOUR OF THIS PART, IF THE COMMISSIONER
DETERMINES THAT ANY TAX IMPOSED UNDER THIS CHAPTER OR ANY RELATED STAT-
UTE, AS DEFINED IN SECTION EIGHTEEN HUNDRED OF THIS CHAPTER, HAS BEEN
FINALLY DETERMINED TO BE DUE FROM A PERSON REQUIRED TO COLLECT TAX AND
HAS NOT BEEN PAID, UPON WRITTEN REQUEST OF THE PERSON WHO FILED THE
CERTIFICATE OF REGISTRATION FOR A CERTIFICATE OF AUTHORITY THAT WAS
REFUSED, THE COMMISSIONER MAY DISCLOSE TO SUCH PERSON THE NAME OF THE
PERSON OR PERSONS REQUIRED TO COLLECT TAX WHOSE TAX LIABILITY OR LIABIL-
ITIES WERE GROUNDS FOR THE REFUSAL TO ISSUE THE CERTIFICATE OF AUTHORITY
AND THE AMOUNT OR AMOUNTS OF TAX DUE FOR EACH SUCH PERSON OR PERSONS.
S 8. Subdivisions (a) and (b) of section 1817 of the tax law, as
amended by section 53 of part K of chapter 61 of the laws of 2011, are
amended to read as follows:
(a) Any person required to obtain a certificate of authority under
section eleven hundred thirty-four of this chapter who, without possess-
ing a valid certificate of authority, OR POSSESSING A CERTIFICATE OF
AUTHORITY THAT WAS DEEMED TO HAVE EXPIRED PURSUANT TO PARAGRAPH FIVE OF
SUBDIVISION (A) OF SECTION ELEVEN HUNDRED THIRTY-FOUR OF THIS CHAPTER
willfully (1) sells tangible personal property or services subject to
tax, receives amusement charges or operates a hotel, (2) purchases or
sells tangible personal property for resale, or (3) sells petroleum
products; and any person who fails to surrender a certificate of author-
ity as required by such article shall be guilty of [a misdemeanor] CRIM-
INAL TAX FRAUD IN THE FIFTH DEGREE.
(b) Any person required to obtain a certificate of authority under
section eleven hundred thirty-four of this chapter who within five years
after a determination by the commissioner[,] pursuant to such section[,]
to suspend, revoke or refuse to issue a certificate of authority has
become final, OR WAS NOTIFIED BY THE COMMISSIONER THAT THE PERSON'S
S. 2609--B 76 A. 3009--B
CERTIFICATE OF AUTHORITY WAS DEEMED TO HAVE EXPIRED PURSUANT TO PARA-
GRAPH FIVE OF SUBDIVISION (A) OF SECTION ELEVEN HUNDRED THIRTY-FOUR OF
THIS CHAPTER, and without possession of a valid certificate of authority
WILLFULLY (1) sells tangible personal property or services subject to
tax, receives amusement charges or operates a hotel, (2) purchases or
sells tangible personal property for resale, or (3) sells petroleum
products, shall be guilty of [a misdemeanor] CRIMINAL TAX FRAUD IN THE
FOURTH DEGREE. It shall be an affirmative defense that such person
performed the acts described in this subdivision without knowledge of
such determination. Any person who violates a provision of this subdivi-
sion, upon conviction, shall be subject to a fine in any amount author-
ized by this article, but not less than five hundred dollars, in addi-
tion to any other penalty provided by law.
S 9. This act shall take effect immediately, provided that the amend-
ments to subparagraph (A) of paragraph 4 of subdivision (a) of section
1134 of the tax law made by section one of this act shall be subject to
the expiration and reversion of such subparagraph pursuant to section 23
of part U of chapter 61 of the laws of 2011, as amended when upon such
date the provisions of section two of this act shall take effect.
PART N
Section 1. Subdivision 1 of section 480-a of the tax law is amended by
adding a new paragraph (f) to read as follows:
(F) WHEN A PERSON FILES AN APPLICATION FOR A CERTIFICATE OF REGISTRA-
TION UNDER THIS SECTION, AND IN CONSIDERING SUCH APPLICATION THE COMMIS-
SIONER ASCERTAINS THE EXISTENCE OF ONE OR MORE OF THE GROUNDS FOR
REFUSAL OF A CERTIFICATE OF AUTHORITY IN CLAUSES (I), (II), (III), (IV),
AND (V) OF SUBPARAGRAPH (B) OF PARAGRAPH FOUR OF SUBDIVISION (A) OF
SECTION ELEVEN HUNDRED THIRTY-FOUR OF THIS CHAPTER, THE COMMISSIONER MAY
REFUSE TO ISSUE A CERTIFICATE OF REGISTRATION. NOTWITHSTANDING ANY
PROVISION OF THIS CHAPTER TO THE CONTRARY, IF THE COMMISSIONER REFUSES
TO ISSUE A CERTIFICATE OF REGISTRATION UNDER THIS SUBDIVISION, THE
COMMISSIONER SHALL UPON WRITTEN REQUEST OF THE PERSON FILING SUCH APPLI-
CATION DISCLOSE THE NAME OF THE PERSON OR PERSONS WHOSE TAX LIABILITIES
WERE GROUNDS FOR THE REFUSAL TO ISSUE THE CERTIFICATE OF REGISTRATION.
S 2. Paragraph (d) of subdivision 2 of section 480-a of the tax law,
as amended by chapter 760 of the laws of 1992, is amended to read as
follows:
(d) Except as otherwise provided in this section, all the provisions
of article twenty-eight of this chapter relating to the personal liabil-
ity for the tax, administration, collection and determination of tax,
and deposit and disposition of revenue, including section eleven hundred
thirty-eight of this chapter relating to determination of tax and
section eleven hundred forty-five of this chapter (but only paragraphs
one and two of subdivision (a) of such section) relating to penalties
and interest for failure to file a return or pay tax within the time
required, shall apply to the applications for registration and the fees
for filing such applications required by this section and the penalty
imposed pursuant to subdivision three of this section, as if such appli-
cations were returns required under section eleven hundred thirty-six of
this chapter and such filing fees, penalties and interest were taxes
required to be paid pursuant to such article twenty-eight, in the same
manner and with the same force and effect as if the language of such
provisions of such article twenty-eight had been incorporated in full
into this article, except to the extent that any such provision is
S. 2609--B 77 A. 3009--B
either inconsistent with a provision of this section or is not relevant
thereto and with such other modifications as may be necessary to adapt
the language of such provisions to the provisions of this section.
[Section] EXCEPT AS PROVIDED FOR IN PARAGRAPH (F) OF SUBDIVISION ONE OF
THIS SECTION, SECTION eleven hundred thirty-four of such article twen-
ty-eight shall not apply to this section. Provided, however, that the
commissioner of taxation and finance shall refund or credit an applica-
tion fee paid with respect to the registration of a vending machine or a
retail place of business in this state through which cigarettes or
tobacco products were to be sold if, prior to the beginning of the
calendar year with respect to which such registration relates, the
certificate of registration described in paragraph (a) of this subdivi-
sion is returned to the department of taxation and finance, or if such
certificate has been destroyed, the retail dealer or vending machine
operator satisfactorily accounts to the commissioner for the missing
certificate, but such vending machine or retail place of business may
not be used to sell cigarettes or tobacco products in this state during
such calendar year, unless it is re-registered. The provisions of
section eleven hundred thirty-nine of this chapter shall apply to the
refund or credit authorized by the preceding sentence and for such
purposes, such refund or credit shall be deemed a refund of tax paid in
error provided, however, no interest shall be allowed or paid on any
such refund.
S 3. This act shall take effect immediately and shall apply to certif-
icates of registration applications filed for calendar year 2014 and
thereafter.
PART O
Section 1. Subparagraph (i) of paragraph (b) of subdivision 1 of
section 481 of the tax law, as amended by chapter 604 of the laws of
2008, is amended to read as follows:
(i) In addition to any other penalty imposed by this article, the
commissioner may (A) impose a penalty of not more than [one] SIX hundred
[fifty] dollars for each two hundred cigarettes, or fraction thereof, in
excess of one thousand cigarettes in unstamped or unlawfully stamped
packages in the possession or under the control of any person or (B)
impose a penalty of not more than two hundred dollars for each ten unaf-
fixed false, altered or counterfeit cigarette tax stamps, imprints or
impressions, or fraction thereof, in the possession or under the control
of any person. In addition, the commissioner may impose a penalty of not
more than seventy-five dollars for each fifty cigars or one pound of
tobacco, or fraction thereof, in excess of two hundred fifty cigars or
five pounds of tobacco in the possession or under the control of any
person and a penalty of not more than one hundred fifty dollars for each
fifty cigars or pound of tobacco, or fraction thereof, in excess of five
hundred cigars or ten pounds of tobacco in the possession or under the
control of any person, with respect to which the tobacco products tax
has not been paid or assumed by a distributor or tobacco products deal-
er; provided, however, that any such penalty imposed shall not exceed
seven thousand five hundred dollars in the aggregate. The commissioner
may impose a penalty of not more than seventy-five dollars for each
fifty cigars or one pound of tobacco, or fraction thereof, in excess of
fifty cigars or one pound of tobacco in the possession or under the
control of any tobacco products dealer or distributor appointed by the
commissioner, and a penalty of not more than one hundred fifty dollars
S. 2609--B 78 A. 3009--B
for each fifty cigars or pound of tobacco, or fraction thereof, in
excess of two hundred fifty cigars or five pounds of tobacco in the
possession or under the control of any such dealer or distributor, with
respect to which the tobacco products tax has not been paid or assumed
by a distributor or a tobacco products dealer; provided, however, that
any such penalty imposed shall not exceed fifteen thousand dollars in
the aggregate.
S 2. This act shall take effect June 1, 2013.
PART P
Section 1. The tax law is amended by adding a new section 171-v to
read as follows:
S 171-V. ENFORCEMENT OF DELINQUENT TAX LIABILITIES THROUGH THE SUSPEN-
SION OF DRIVERS' LICENSES. (1) THE COMMISSIONER SHALL ENTER INTO A WRIT-
TEN AGREEMENT WITH THE COMMISSIONER OF MOTOR VEHICLES, WHICH SHALL SET
FORTH THE PROCEDURES FOR THE TWO DEPARTMENTS TO COOPERATE IN A PROGRAM
TO IMPROVE TAX COLLECTION THROUGH THE SUSPENSION OF DRIVERS' LICENSES OF
TAXPAYERS WITH PAST-DUE TAX LIABILITIES EQUAL TO OR IN EXCESS OF TEN
THOUSAND DOLLARS. FOR THE PURPOSES OF THIS SECTION, THE TERM "TAX
LIABILITIES" SHALL MEAN ANY TAX, SURCHARGE, OR FEE ADMINISTERED BY THE
COMMISSIONER, OR ANY PENALTY OR INTEREST DUE ON THESE AMOUNTS OWED BY AN
INDIVIDUAL WITH A NEW YORK DRIVER'S LICENSE, THE TERM "DRIVER'S LICENSE"
MEANS ANY LICENSE ISSUED BY THE DEPARTMENT OF MOTOR VEHICLES, EXCEPT FOR
A COMMERCIAL DRIVER'S LICENSE AS DEFINED IN SECTION FIVE HUNDRED ONE-A
OF THE VEHICLE AND TRAFFIC LAW, AND THE TERM "PAST-DUE TAX LIABILITIES"
MEANS ANY TAX LIABILITY OR LIABILITIES WHICH HAVE BECOME FIXED AND FINAL
SUCH THAT THE TAXPAYER NO LONGER HAS ANY RIGHT TO ADMINISTRATIVE OR
JUDICIAL REVIEW.
(2) THE AGREEMENT SHALL INCLUDE THE FOLLOWING PROVISIONS:
(A) THE PROCEDURES BY WHICH THE DEPARTMENT SHALL NOTIFY THE COMMIS-
SIONER OF MOTOR VEHICLES OF TAXPAYERS WITH PAST-DUE TAX LIABILITIES,
INCLUDING THE PROCEDURES BY WHICH THE DEPARTMENT AND THE DEPARTMENT OF
MOTOR VEHICLES SHALL SHARE THE INFORMATION NECESSARY TO IDENTIFY INDI-
VIDUALS WITH PAST-DUE TAX LIABILITIES, WHICH SHALL INCLUDE A TAXPAYER'S
NAME, SOCIAL SECURITY NUMBER, AND ANY OTHER INFORMATION NECESSARY TO
ENSURE THE PROPER IDENTIFICATION OF THE TAXPAYER;
(B) THE PROCEDURES BY WHICH THE COMMISSIONER SHALL NOTIFY THE DEPART-
MENT OF MOTOR VEHICLES THAT A TAXPAYER HAS SATISFIED HIS OR HER PAST-DUE
TAX LIABILITIES, OR HAS ENTERED INTO AN INSTALLMENT PAYMENT AGREEMENT OR
HAS OTHERWISE MADE PAYMENT ARRANGEMENTS SATISFACTORY TO THE COMMISSION-
ER, SO THAT THE SUSPENSION OF THE TAXPAYER'S DRIVER'S LICENSE MAY BE
LIFTED; AND
(C) ANY OTHER MATTER THE DEPARTMENT AND THE DEPARTMENT OF MOTOR VEHI-
CLES SHALL DEEM NECESSARY TO CARRY OUT THE PROVISIONS OF THIS SECTION.
(3) THE DEPARTMENT SHALL PROVIDE NOTICE TO THE TAXPAYER OF HIS OR HER
INCLUSION IN THE LICENSE SUSPENSION PROGRAM NO LATER THAN FORTY-FIVE
DAYS PRIOR TO THE DATE THE DEPARTMENT INTENDS TO INFORM THE COMMISSIONER
OF MOTOR VEHICLES OF THE TAXPAYER'S INCLUSION. HOWEVER, NO SUCH NOTICE
SHALL BE ISSUED TO A TAXPAYER WHOSE WAGES ARE BEING GARNISHED BY THE
DEPARTMENT FOR THE PAYMENT OF PAST-DUE TAX LIABILITIES OR PAST-DUE CHILD
SUPPORT OR COMBINED CHILD AND SPOUSAL SUPPORT ARREARS. NOTICE SHALL BE
PROVIDED BY FIRST CLASS MAIL TO THE TAXPAYER'S LAST KNOWN ADDRESS AS
SUCH ADDRESS APPEARS IN THE ELECTRONIC SYSTEMS OR RECORDS OF THE DEPART-
MENT. SUCH NOTICE SHALL INCLUDE:
S. 2609--B 79 A. 3009--B
(A) A CLEAR STATEMENT OF THE PAST-DUE TAX LIABILITIES ALONG WITH A
STATEMENT THAT THE DEPARTMENT SHALL PROVIDE TO THE DEPARTMENT OF MOTOR
VEHICLES THE TAXPAYER'S NAME, SOCIAL SECURITY NUMBER AND ANY OTHER IDEN-
TIFYING INFORMATION NECESSARY FOR THE PURPOSE OF SUSPENDING HIS OR HER
DRIVER'S LICENSE PURSUANT TO THIS SECTION AND SUBDIVISION FOUR-F OF
SECTION FIVE HUNDRED TEN OF THE VEHICLE AND TRAFFIC LAW FORTY-FIVE DAYS
AFTER THE MAILING OR SENDING OF SUCH NOTICE TO THE TAXPAYER;
(B) A STATEMENT THAT THE TAXPAYER MAY AVOID SUSPENSION OF HIS OR HER
LICENSE BY FULLY SATISFYING THE PAST-DUE TAX LIABILITIES OR BY MAKING
PAYMENT ARRANGEMENTS SATISFACTORY TO THE COMMISSIONER, AND INFORMATION
AS TO HOW THE TAXPAYER CAN PAY THE PAST-DUE TAX LIABILITIES TO THE
DEPARTMENT, ENTER INTO A PAYMENT ARRANGEMENT OR REQUEST ADDITIONAL
INFORMATION;
(C) A STATEMENT THAT THE TAXPAYER'S RIGHT TO PROTEST THE NOTICE IS
LIMITED TO RAISING ISSUES SET FORTH IN SUBDIVISION FIVE OF THIS SECTION;
(D) A STATEMENT THAT THE SUSPENSION OF THE TAXPAYER'S DRIVER'S LICENSE
SHALL CONTINUE UNTIL THE PAST-DUE TAX LIABILITIES ARE FULLY PAID OR THE
TAXPAYER MAKES PAYMENT ARRANGEMENTS SATISFACTORY TO THE COMMISSIONER;
AND
(E) ANY OTHER INFORMATION THAT THE COMMISSIONER DEEMS NECESSARY.
(4) AFTER THE EXPIRATION OF THE FORTY-FIVE DAY PERIOD, IF THE TAXPAYER
HAS NOT CHALLENGED THE NOTICE PURSUANT TO SUBDIVISION FIVE OF THIS
SECTION AND THE TAXPAYER HAS FAILED TO SATISFY THE PAST-DUE TAX LIABIL-
ITIES OR MAKE PAYMENT ARRANGEMENTS SATISFACTORY TO THE COMMISSIONER, THE
DEPARTMENT SHALL NOTIFY THE DEPARTMENT OF MOTOR VEHICLES, IN THE MANNER
AGREED UPON BY THE TWO AGENCIES, THAT THE TAXPAYER'S DRIVER'S LICENSE
SHALL BE SUSPENDED PURSUANT TO SUBDIVISION FOUR-F OF SECTION FIVE
HUNDRED TEN OF THE VEHICLE AND TRAFFIC LAW; PROVIDED, HOWEVER, IN ANY
CASE WHERE A TAXPAYER FAILS TO COMPLY WITH THE TERMS OF A CURRENT
PAYMENT ARRANGEMENT MORE THAN ONCE WITHIN A TWELVE MONTH PERIOD, THE
COMMISSIONER SHALL IMMEDIATELY NOTIFY THE DEPARTMENT OF MOTOR VEHICLES
THAT THE TAXPAYER'S DRIVER'S LICENSE SHALL BE SUSPENDED.
(5) NOTWITHSTANDING ANY OTHER PROVISION OF LAW, AND EXCEPT AS SPECIF-
ICALLY PROVIDED HEREIN, THE TAXPAYER SHALL HAVE NO RIGHT TO COMMENCE A
COURT ACTION OR PROCEEDING OR TO ANY OTHER LEGAL RECOURSE AGAINST THE
DEPARTMENT OR THE DEPARTMENT OF MOTOR VEHICLES REGARDING A NOTICE ISSUED
BY THE DEPARTMENT PURSUANT TO THIS SECTION AND THE REFERRAL BY THE
DEPARTMENT OF ANY TAXPAYER WITH PAST-DUE TAX LIABILITIES TO THE DEPART-
MENT OF MOTOR VEHICLES PURSUANT TO THIS SECTION FOR THE PURPOSE OF
SUSPENDING THE TAXPAYER'S DRIVER'S LICENSE. A TAXPAYER MAY ONLY CHAL-
LENGE SUCH SUSPENSION OR REFERRAL ON THE GROUNDS THAT (I) THE INDIVIDUAL
TO WHOM THE NOTICE WAS PROVIDED IS NOT THE TAXPAYER AT ISSUE; (II) THE
PAST-DUE TAX LIABILITIES WERE SATISFIED; (III) THE TAXPAYER'S WAGES ARE
BEING GARNISHED BY THE DEPARTMENT FOR THE PAYMENT OF THE PAST-DUE TAX
LIABILITIES AT ISSUE OR FOR PAST-DUE CHILD SUPPORT OR COMBINED CHILD AND
SPOUSAL SUPPORT ARREARS; (IV) THE TAXPAYER'S WAGES ARE BEING GARNISHED
FOR THE PAYMENT OF PAST-DUE CHILD SUPPORT OR COMBINED CHILD AND SPOUSAL
SUPPORT ARREARS PURSUANT TO AN INCOME EXECUTION ISSUED PURSUANT TO
SECTION FIVE THOUSAND TWO HUNDRED FORTY-ONE OF THE CIVIL PRACTICE LAW
AND RULES; (V) THE TAXPAYER'S DRIVER'S LICENSE IS A COMMERCIAL DRIVER'S
LICENSE AS DEFINED IN SECTION FIVE HUNDRED ONE-A OF THE VEHICLE AND
TRAFFIC LAW; OR (VI) THE DEPARTMENT INCORRECTLY FOUND THAT THE TAXPAYER
HAS FAILED TO COMPLY WITH THE TERMS OF A PAYMENT ARRANGEMENT MADE WITH
THE COMMISSIONER MORE THAN ONCE WITHIN A TWELVE MONTH PERIOD FOR THE
PURPOSES OF SUBDIVISION THREE OF THIS SECTION.
S. 2609--B 80 A. 3009--B
HOWEVER, NOTHING IN THIS SUBDIVISION IS INTENDED TO LIMIT A TAXPAYER
FROM SEEKING RELIEF FROM JOINT AND SEVERAL LIABILITY PURSUANT TO SECTION
SIX HUNDRED FIFTY-FOUR OF THIS CHAPTER, TO THE EXTENT THAT HE OR SHE IS
ELIGIBLE PURSUANT TO THAT SUBDIVISION, OR ESTABLISHING TO THE DEPARTMENT
THAT THE ENFORCEMENT OF THE UNDERLYING TAX LIABILITIES HAS BEEN STAYED
BY THE FILING OF A PETITION PURSUANT TO THE BANKRUPTCY CODE OF 1978
(TITLE ELEVEN OF THE UNITED STATES CODE).
(6) NOTWITHSTANDING ANY PROVISION OF THIS CHAPTER TO THE CONTRARY, THE
DEPARTMENT MAY DISCLOSE TO THE DEPARTMENT OF MOTOR VEHICLES THE INFORMA-
TION DESCRIBED IN THIS SECTION THAT, IN THE DISCRETION OF THE COMMIS-
SIONER, IS NECESSARY FOR THE PROPER IDENTIFICATION OF A TAXPAYER
REFERRED TO THE DEPARTMENT OF MOTOR VEHICLES FOR THE PURPOSE OF SUSPEND-
ING THE TAXPAYER'S DRIVER'S LICENSE PURSUANT TO THIS SECTION AND SUBDI-
VISION FOUR-F OF SECTION FIVE HUNDRED TEN OF THE VEHICLE AND TRAFFIC
LAW. THE DEPARTMENT OF MOTOR VEHICLES MAY NOT REDISCLOSE THIS INFORMA-
TION TO ANY OTHER ENTITY OR PERSON, OTHER THAN FOR THE PURPOSE OF
INFORMING THE TAXPAYER THAT HIS OR HER DRIVER'S LICENSE HAS BEEN
SUSPENDED.
(7) EXCEPT AS OTHERWISE PROVIDED IN THIS SECTION, THE ACTIVITIES TO
COLLECT PAST-DUE TAX LIABILITIES UNDERTAKEN BY THE DEPARTMENT PURSUANT
TO THIS SECTION SHALL NOT IN ANY WAY LIMIT, RESTRICT OR IMPAIR THE
DEPARTMENT FROM EXERCISING ANY OTHER AUTHORITY TO COLLECT OR ENFORCE TAX
LIABILITIES UNDER ANY OTHER APPLICABLE PROVISION OF LAW.
S 2. Section 510 of the vehicle and traffic law is amended by adding a
new subdivision 4-f to read as follows:
4-F. SUSPENSION FOR FAILURE TO PAY PAST-DUE TAX LIABILITIES. (1) THE
COMMISSIONER SHALL ENTER INTO A WRITTEN AGREEMENT WITH THE COMMISSIONER
OF TAXATION AND FINANCE, AS PROVIDED IN SECTION ONE HUNDRED
SEVENTY-ONE-V OF THE TAX LAW, WHICH SHALL SET FORTH THE PROCEDURES FOR
SUSPENDING THE DRIVERS' LICENSES OF INDIVIDUALS WHO HAVE FAILED TO
SATISFY PAST-DUE TAX LIABILITIES AS SUCH TERMS ARE DEFINED IN SUCH
SECTION.
(2) UPON RECEIPT OF NOTIFICATION FROM THE DEPARTMENT OF TAXATION AND
FINANCE THAT AN INDIVIDUAL HAS FAILED TO SATISFY PAST-DUE TAX LIABIL-
ITIES, OR TO OTHERWISE MAKE PAYMENT ARRANGEMENTS SATISFACTORY TO THE
COMMISSIONER OF TAXATION AND FINANCE, OR HAS FAILED TO COMPLY WITH THE
TERMS OF SUCH PAYMENT ARRANGEMENTS MORE THAN ONCE WITHIN A TWELVE MONTH
PERIOD, THE COMMISSIONER OR HIS OR HER AGENT SHALL SUSPEND THE LICENSE
OF SUCH PERSON TO OPERATE A MOTOR VEHICLE. IN THE EVENT SUCH PERSON IS
UNLICENSED, SUCH PERSON'S PRIVILEGE OF OBTAINING A LICENSE SHALL BE
SUSPENDED. SUCH SUSPENSION SHALL TAKE EFFECT NO LATER THAN FIFTEEN DAYS
FROM THE DATE OF THE NOTICE THEREOF PROVIDED TO THE PERSON WHOSE LICENSE
OR PRIVILEGE OF OBTAINING A LICENSE IS TO BE SUSPENDED, AND SHALL REMAIN
IN EFFECT UNTIL SUCH TIME AS THE COMMISSIONER IS ADVISED THAT THE PERSON
HAS SATISFIED HIS OR HER PAST-DUE TAX LIABILITIES, OR HAS OTHERWISE MADE
PAYMENT ARRANGEMENTS SATISFACTORY TO THE COMMISSIONER OF TAXATION AND
FINANCE.
(3) FROM THE TIME THE COMMISSIONER IS NOTIFIED BY THE DEPARTMENT OF
TAXATION AND FINANCE UNDER THIS SECTION, THE COMMISSIONER SHALL BE
RELIEVED FROM ALL LIABILITY TO SUCH PERSON WHICH MAY OTHERWISE ARISE
UNDER THIS SECTION, AND SUCH PERSON SHALL HAVE NO RIGHT TO COMMENCE A
COURT ACTION OR PROCEEDING OR TO ANY OTHER LEGAL RECOURSE AGAINST THE
COMMISSIONER TO RECOVER SUCH DRIVING PRIVILEGES AS AUTHORIZED BY THIS
SECTION. IN ADDITION, NOTWITHSTANDING ANY OTHER PROVISION OF LAW, SUCH
PERSON SHALL HAVE NO RIGHT TO A HEARING OR APPEAL PURSUANT TO THIS CHAP-
S. 2609--B 81 A. 3009--B
TER WITH RESPECT TO A SUSPENSION OF DRIVING PRIVILEGES AS AUTHORIZED BY
THIS SECTION.
(4) NOTWITHSTANDING ANY PROVISION OF LAW TO THE CONTRARY, THE DEPART-
MENT SHALL FURNISH THE DEPARTMENT OF TAXATION AND FINANCE WITH THE
INFORMATION NECESSARY FOR THE PROPER IDENTIFICATION OF AN INDIVIDUAL
REFERRED TO THE DEPARTMENT FOR THE PURPOSE OF DRIVER'S LICENSE SUSPEN-
SION PURSUANT TO THIS SECTION AND SECTION ONE HUNDRED SEVENTY-ONE-V OF
THE TAX LAW. THIS SHALL INCLUDE THE INDIVIDUAL'S NAME, SOCIAL SECURITY
NUMBER AND ANY OTHER INFORMATION THE COMMISSIONER OF MOTOR VEHICLES
DEEMS NECESSARY.
(5) ANY PERSON WHOSE DRIVER'S LICENSE IS SUSPENDED PURSUANT TO PARA-
GRAPH TWO OF THIS SUBDIVISION MAY APPLY FOR THE ISSUANCE OF A RESTRICTED
USE LICENSE AS PROVIDED IN SECTION FIVE HUNDRED THIRTY OF THIS TITLE.
S 3. Subdivision 7 of section 511 of the vehicle and traffic law, as
added by chapter 81 of the laws of 1995, is amended to read as follows:
7. Exceptions. When a person is convicted of a violation of subdivi-
sion one [of] OR two of this section, and the suspension was issued
pursuant to (A) subdivision four-e of section five hundred ten of this
article due to a support arrears, OR (B) SUBDIVISION FOUR-F OF SECTION
FIVE HUNDRED TEN OF THE ARTICLE DUE TO PAST-DUE TAX LIABILITIES, the
mandatory penalties set forth in subdivision one or two of this section
shall not be applicable if, on or before the return date or subsequent
adjourned date, such person presents proof that such support arrears OR
PAST-DUE TAX LIABILITIES have been satisfied as shown by certified
check, notice issued by the court ordering the suspension, or notice
from a support collection unit OR DEPARTMENT OF TAXATION AND FINANCE AS
APPLICABLE. The sentencing court shall take the satisfaction of arrears
OR THE PAYMENT OF THE PAST-DUE TAX LIABILITIES into account when impos-
ing a sentence for any such conviction. FOR LICENSES SUSPENDED FOR NON-
PAYMENT OF PAST-DUE TAX LIABILITIES, THE COURT SHALL ALSO TAKE INTO
CONSIDERATION PROOF, IN THE FORM OF A NOTICE FROM THE DEPARTMENT OF
TAXATION AND FINANCE, THAT SUCH PERSON HAS MADE PAYMENT ARRANGEMENTS
THAT ARE SATISFACTORY TO THE COMMISSIONER OF TAXATION AND FINANCE.
S 4. Section 530 of the vehicle and traffic law is amended by adding a
new subdivision 5-b to read as follows:
(5-B) ISSUANCE OF A RESTRICTED LICENSE SHALL NOT BE DENIED TO ANY
PERSON WHOSE LICENSE IS SUSPENDED PURSUANT TO SUBDIVISION FOUR-F OF
SECTION FIVE HUNDRED TEN OF THIS TITLE FOR ANY REASON OTHER THAN SUCH
PERSON'S FAILURE TO OTHERWISE HAVE A VALID OR RENEWABLE DRIVER'S
LICENSE. THE RESTRICTIONS ON THE TYPES OF VEHICLES WHICH MAY BE OPERATED
WITH A RESTRICTED LICENSE CONTAINED IN SUCH SUBDIVISION FIVE OF THIS
SECTION SHALL NOT BE APPLICABLE TO A RESTRICTED LICENSE ISSUED TO A
PERSON PURSUANT TO SUBDIVISION FOUR-F OF SECTION FIVE HUNDRED TEN OF
THIS TITLE. THE ISSUANCE OF A RESTRICTED LICENSE ISSUED AS A RESULT OF A
SUSPENSION UNDER SUBDIVISION FOUR-F OF SECTION FIVE HUNDRED TEN OF THIS
TITLE SHALL NOT IN ANY WAY AFFECT A PERSON'S ELIGIBILITY FOR A
RESTRICTED LICENSE AT SOME FUTURE TIME.
S 5. Section 2335-a of the insurance law, as added by chapter 152 of
the laws of 1998, is amended to read as follows:
S 2335-a. Prohibition of rate increases for persons involved in emer-
gency use of vehicles OR DUE TO A DRIVER'S LICENSE SUSPENSION FOR PAST-
DUE TAX LIABILITIES.
(A) No insurer authorized to transact or transacting business in this
state, or controlling or controlled by or under common control by or
with an insurer authorized to transact or transacting business in this
state, [which] THAT sells a policy providing motor vehicle liability
S. 2609--B 82 A. 3009--B
insurance coverage in this state, shall increase the policy premium in
connection with the insurance permitted or required by this chapter
solely because the insured or any other person who customarily operates
an automobile covered by the policy has had an accident while operating
a motor vehicle in response to an emergency, where the insured was
either responding to a call to duty as a paid or volunteer member of any
police or fire department or first aid squad[;], or was performing any
other function on behalf of the state, any political subdivision there-
of, a public authority, public benefit corporation, or any other govern-
mental agency or instrumentality in a public emergency.
(B) NO INSURER AUTHORIZED TO TRANSACT OR TRANSACTING BUSINESS IN THIS
STATE, OR CONTROLLING OR CONTROLLED BY OR UNDER COMMON CONTROL BY OR
WITH AN INSURER AUTHORIZED TO TRANSACT OR TRANSACTING BUSINESS IN THIS
STATE, THAT SELLS A POLICY PROVIDING MOTOR VEHICLE INSURANCE COVERAGE IN
THIS STATE SHALL INCREASE THE POLICY PREMIUM IN CONNECTION WITH THE
INSURANCE PERMITTED OR REQUIRED BY THIS CHAPTER SOLELY BECAUSE THE
INSURED OR ANY OTHER PERSON WHO CUSTOMARILY OPERATES AN AUTOMOBILE
COVERED BY THE POLICY HAS HAD HIS OR HER DRIVER'S LICENSE SUSPENDED
PURSUANT TO SUBDIVISION FOUR-F OF SECTION FIVE HUNDRED TEN OF THE VEHI-
CLE AND TRAFFIC LAW FOR PAST-DUE TAX LIABILITIES, AS DEFINED IN SECTION
ONE HUNDRED SEVENTY-ONE-V OF THE TAX LAW, OR HAS APPLIED FOR OR RECEIVED
A RESTRICTED USE LICENSE AS PROVIDED FOR BY SECTION FIVE HUNDRED THIRTY
OF THE VEHICLE AND TRAFFIC LAW, AS THE RESULT OF SUCH SUSPENSION.
S 6. The insurance law is amended by adding a new section 2616 to read
as follows:
S 2616. DISCRIMINATION BECAUSE OF A DRIVER'S LICENSE SUSPENSION FOR
PAST-DUE TAX LIABILITIES. AN INDIVIDUAL OR ENTITY SHALL NOT REFUSE TO
ISSUE ANY POLICY OF MOTOR VEHICLE INSURANCE, OR CANCEL OR DECLINE TO
RENEW SUCH POLICY, BECAUSE THE APPLICANT OR POLICY HOLDER HAS HAD HIS OR
HER DRIVER'S LICENSE SUSPENDED PURSUANT TO SUBDIVISION FOUR-F OF SECTION
FIVE HUNDRED TEN OF THE VEHICLE AND TRAFFIC LAW FOR PAST-DUE TAX LIABIL-
ITIES, AS DEFINED IN SECTION ONE HUNDRED SEVENTY-ONE-V OF THE TAX LAW,
OR HAS APPLIED FOR OR RECEIVED A RESTRICTED USE LICENSE, AS PROVIDED FOR
BY SECTION FIVE HUNDRED THIRTY OF THE VEHICLE AND TRAFFIC LAW, AS THE
RESULT OF SUCH SUSPENSION.
S 7. This act shall take effect immediately; provided, however, that
the department of taxation and finance and the department of motor vehi-
cles shall have up to six months after this act shall have become a law
to execute the written agreement and implement the necessary procedures
as described in sections one and two of this act.
PART Q
Section 1. The tax law is amended by adding a new section 174-c to
read as follows:
S 174-C. SERVICE OF INCOME EXECUTION WITHOUT FILING A WARRANT. 1.
NOTWITHSTANDING ANY PROVISION OF LAW TO THE CONTRARY, IF ANY INDIVIDUAL
LIABLE FOR THE PAYMENT OF ANY TAX OR OTHER IMPOSITION ADMINISTERED BY
THE COMMISSIONER, INCLUDING ANY ADDITIONS TO TAX, PENALTIES AND INTEREST
IN CONNECTION THEREWITH, FAILS TO PAY OR TO COLLECT OR PAY OVER THE SAME
WITHIN TWENTY-ONE CALENDAR DAYS AFTER NOTICE AND DEMAND THEREFOR IS
GIVEN TO SUCH INDIVIDUAL (TEN BUSINESS DAYS IF THE AMOUNT FOR WHICH SUCH
NOTICE AND DEMAND IS MADE EQUALS OR EXCEEDS ONE HUNDRED THOUSAND
DOLLARS), THE COMMISSIONER IS AUTHORIZED TO SERVE AN INCOME EXECUTION ON
THE INDIVIDUAL OR ON THE PERSON FROM WHOM THE INDIVIDUAL IS RECEIVING,
OR WILL RECEIVE, MONEY, WITHOUT FILING A WARRANT IN THE OFFICE OF THE
S. 2609--B 83 A. 3009--B
CLERK OF THE APPROPRIATE COUNTY OR IN THE DEPARTMENT OF STATE AS
PROVIDED FOR IN THIS CHAPTER. FOR PURPOSES OF SERVING AN INCOME
EXECUTION PURSUANT TO THIS SECTION, THE COMMISSIONER SHALL, IN THE RIGHT
OF THE PEOPLE OF THE STATE OF NEW YORK, BE DEEMED TO HAVE OBTAINED JUDG-
MENT AGAINST THE INDIVIDUAL FOR THE TAX OR OTHER IMPOSITION, AND THE
ADDITIONS TO TAX, PENALTIES AND INTEREST IN CONNECTION THEREOF, AND
THERE SHALL BE A LIEN ON THE AMOUNT OF THE INDIVIDUAL'S INCOME THAT MAY
BE GARNISHED. IF THE COMMISSIONER CHOOSES TO SERVE AN INCOME EXECUTION
WITHOUT FILING A WARRANT PURSUANT TO THIS SECTION, THE COMMISSIONER MUST
SERVE THE INCOME EXECUTION WITHIN SIX YEARS AFTER THE FIRST DATE A
WARRANT COULD BE FILED PURSUANT TO SECTION ONE HUNDRED SEVENTY-FOUR-B OF
THIS ARTICLE. WHEN SERVING AN INCOME EXECUTION WITHOUT THE FILING OF A
WARRANT, THE COMMISSIONER SHALL FOLLOW THE PROCEDURES SET FORTH IN
SECTION FIVE THOUSAND TWO HUNDRED THIRTY-ONE OF THE CIVIL PRACTICE LAW
AND RULES, WITH THE REFERENCES IN SUCH SECTION TO "SHERIFF" TO BE READ
AS REFERRING TO THE COMMISSIONER OR THE DEPARTMENT. SUCH INCOME
EXECUTION SHALL CONTINUE TO BE IN EFFECT UNTIL SUCH LIABILITY IS SATIS-
FIED OR UNTIL TWENTY YEARS FROM THE FIRST DATE A WARRANT COULD BE FILED
BY THE COMMISSIONER PURSUANT TO SECTION ONE HUNDRED SEVENTY-FOUR-B OF
THIS ARTICLE, WHETHER OR NOT A WARRANT IS FILED FOR THAT LIABILITY.
2. THE PROVISIONS OF THIS SECTION SHALL BE IN ADDITION TO THE PROCE-
DURES RELATING TO COLLECTION OR ADMINISTRATION PROVIDED WITH RESPECT TO
ANY TAX OR OTHER IMPOSITION ADMINISTERED BY THE COMMISSIONER. WHERE A
PROVISION OF THIS SECTION IS INCONSISTENT WITH ANY SUCH PROVISION WITH
RESPECT TO SUCH TAX OR OTHER IMPOSITION, THE PROVISIONS OF THIS SECTION
WILL APPLY. NOTHING IN THIS SECTION SHALL PREVENT THE COMMISSIONER FROM
TIMELY FILING A WARRANT IN ORDER TO PURSUE ANY OF THE COLLECTION METHODS
AUTHORIZED UNDER ARTICLE FIFTY-TWO OF THE CIVIL PRACTICE LAW AND RULES.
S 2. This act shall take effect immediately.
PART R
Section 1. Subparagraph (i) of the opening paragraph of section 1210
of the tax law is REPEALED and a new subparagraph (i) is added to read
as follows:
(I) WITH RESPECT TO A CITY OF ONE MILLION OR MORE AND THE FOLLOWING
COUNTIES (1) ANY SUCH CITY HAVING A POPULATION OF ONE MILLION OR MORE IS
HEREBY AUTHORIZED AND EMPOWERED TO ADOPT AND AMEND LOCAL LAWS, ORDI-
NANCES OR RESOLUTIONS IMPOSING SUCH TAXES IN ANY SUCH CITY, AT THE RATE
OF FOUR AND ONE-HALF PERCENT;
(2) THE FOLLOWING COUNTIES THAT IMPOSE TAXES DESCRIBED IN SUBDIVISION
(A) OF THIS SECTION AT THE RATE OF THREE PERCENT AS AUTHORIZED ABOVE IN
THIS PARAGRAPH FOR SUCH COUNTIES ARE HEREBY FURTHER AUTHORIZED AND
EMPOWERED TO ADOPT AND AMEND LOCAL LAWS, ORDINANCES, OR RESOLUTIONS
IMPOSING SUCH TAXES DESCRIBED IN SUBDIVISION (A) OF THIS SECTION AT THE
FOLLOWING ADDITIONAL RATES, IN QUARTER PERCENT INCREMENTS, WHICH RATES
ARE ADDITIONAL TO THE THREE PERCENT RATE AUTHORIZED ABOVE IN THIS PARA-
GRAPH, AND, IN THE CASE OF A COUNTY AUTHORIZED TO IMPOSE MORE THAN ONE
ADDITIONAL RATE, ALSO IN ADDITION TO EACH OTHER, FOR EACH SUCH COUNTY,
PROVIDED THAT (A) THE COUNTY OF ROCKLAND MAY IMPOSE ADDITIONAL RATES OF
FIVE-EIGHTHS PERCENT AND THREE-EIGHTHS PERCENT, IN LIEU OF IMPOSING SUCH
ADDITIONAL RATE IN QUARTER PERCENT INCREMENTS; (B) THE COUNTY OF ONTARIO
MAY IMPOSE ADDITIONAL RATES OF ONE-EIGHTH PERCENT AND THREE-EIGHTHS
PERCENT, IN LIEU OF IMPOSING SUCH ADDITIONAL RATE IN QUARTER PERCENT
INCREMENTS; (C) THREE-QUARTERS PERCENT OF THE ADDITIONAL RATE AUTHORIZED
S. 2609--B 84 A. 3009--B
TO BE IMPOSED BY THE COUNTY OF NASSAU SHALL BE SUBJECT TO THE LIMITATION
SET FORTH IN SECTION TWELVE HUNDRED SIXTY-TWO-E OF THIS ARTICLE:
(A) ONE-QUARTER OF ONE PERCENT - NONE.
(B) ONE-HALF OF ONE PERCENT - CHAUTAUQUA, ONTARIO, SCHENECTADY.
(C) THREE-QUARTERS OF ONE PERCENT - DUTCHESS, ESSEX, JEFFERSON, LEWIS,
ORANGE.
(D) ONE PERCENT - ALBANY, BROOME, CATTARAUGUS, CAYUGA, CHEMUNG,
CHENANGO, CLINTON, COLUMBIA, CORTLAND, DELAWARE, FRANKLIN, FULTON, GENE-
SEE, GREENE, LIVINGSTON, MADISON, MONROE, MONTGOMERY, NIAGARA, ONONDAGA,
ORLEANS, OSWEGO, OTSEGO, PUTNAM, RENSSELAER, ROCKLAND, SCHOHARIE,
SCHUYLER, SENECA, STEUBEN, SUFFOLK, SULLIVAN, TIOGA, TOMPKINS, ULSTER,
WAYNE, WYOMING, YATES.
(E) ONE AND ONE-QUARTER PERCENT - HERKIMER, NASSAU.
(F) ONE AND ONE-HALF PERCENT - ALLEGANY.
(G) ONE AND THREE-QUARTERS PERCENT - ERIE, ONEIDA.
S 2. Subparagraph (ii) of the opening paragraph of section 1210 of the
tax law is REPEALED and a new subparagraph (ii) is added to read as
follows:
(II) THE FOLLOWING CITIES THAT IMPOSE TAXES DESCRIBED IN SUBDIVISION
(A) OF THIS SECTION AT THE RATE OF ONE AND ONE-HALF PERCENT OR HIGHER AS
AUTHORIZED ABOVE IN THIS PARAGRAPH FOR SUCH CITIES ARE HEREBY FURTHER
AUTHORIZED AND EMPOWERED TO ADOPT AND AMEND LOCAL LAWS, ORDINANCES, OR
RESOLUTIONS IMPOSING SUCH TAXES DESCRIBED IN SUBDIVISION (A) OF THIS
SECTION AT THE FOLLOWING ADDITIONAL RATES, IN QUARTER PERCENT INCRE-
MENTS, WHICH RATES ARE ADDITIONAL TO THE ONE AND ONE-HALF PERCENT OR
HIGHER RATES AUTHORIZED ABOVE IN THIS PARAGRAPH AND, IN THE CASE OF A
CITY AUTHORIZED TO IMPOSE MORE THAN ONE ADDITIONAL RATE, ALSO IN ADDI-
TION TO EACH OTHER, FOR EACH SUCH CITY:
(1) ONE-QUARTER OF ONE PERCENT - NONE.
(2) ONE-HALF OF ONE PERCENT - NONE.
(3) THREE-QUARTERS OF ONE PERCENT - NONE.
(4) ONE PERCENT - MOUNT VERNON; YONKERS; OSWEGO, FOR THE PERIOD BEGIN-
NING DECEMBER FIRST, TWO THOUSAND ELEVEN, AND ENDING NOVEMBER THIRTIETH,
TWO THOUSAND THIRTEEN; NEW ROCHELLE, FOR THE PERIOD BEGINNING JANUARY
FIRST, TWO THOUSAND TWELVE, AND ENDING DECEMBER THIRTY-FIRST, TWO THOU-
SAND THIRTEEN; WHITE PLAINS, FOR THE PERIOD BEGINNING SEPTEMBER FIRST,
TWO THOUSAND ELEVEN, AND ENDING AUGUST THIRTY-FIRST, TWO THOUSAND THIR-
TEEN.
(5) ONE AND ONE-QUARTER PERCENT - NONE.
(6) ONE AND ONE-HALF PERCENT - NONE.
(7) ONE AND THREE-QUARTERS PERCENT - NONE.
S 3. Subparagraph (iii) of the opening paragraph of section 1210 of
the tax law is REPEALED and a new subparagraph (iii) is added to read as
follows:
(III) THE MAXIMUM RATE REFERRED TO IN SECTION TWELVE HUNDRED
TWENTY-FOUR OF THIS ARTICLE SHALL BE CALCULATED WITHOUT REFERENCE TO THE
ADDITIONAL RATES AUTHORIZED FOR COUNTIES, OTHER THAN THE COUNTIES OF
CAYUGA, CORTLAND, FULTON, MADISON, AND OTSEGO IN SUBPARAGRAPH (I) AND
THE CITIES IN SUBPARAGRAPH (II) OF THIS PARAGRAPH.
S 4. Section 1210 of the tax law is amended by adding a new subdivi-
sion (q) to read as follows:
(Q) NOTWITHSTANDING ANY PROVISION OF THIS SECTION OR ANY OTHER LAW, A
COUNTY MAY, BY A MAJORITY VOTE OF ITS GOVERNING BODY, PASS A LOCAL LAW,
ORDINANCE OR RESOLUTION TO IMPOSE THE ADDITIONAL RATE OR RATES OF SUCH
SALES AND COMPENSATING USE TAXES AUTHORIZED BY CLAUSE TWO OF SUBPARA-
GRAPH (I) OF THE OPENING PARAGRAPH OF THIS SECTION FOR A PERIOD NOT TO
S. 2609--B 85 A. 3009--B
EXCEED TWO YEARS. ANY SUCH LOCAL LAW, ORDINANCE, OR RESOLUTION SHALL
ALSO BE SUBJECT TO THE PROVISIONS OF SUBDIVISIONS (D) AND (E) OF THIS
SECTION.
S 5. Section 1210-E of the tax law is REPEALED.
S 6. Subdivisions (d), (e), (f), (g), (h) (i), (j), (k), (l), (m),
(n), (o), (p), (q), (r), (t), (u), (v), (w), (x), (y), (z), (z-1), (aa),
(bb), (cc), (dd), (ee), (ff) and (gg) of section 1224 of the tax law are
REPEALED.
S 7. Section 1224 of the tax law is amended by adding four new subdi-
visions (d),(e), (f), and (g) to read as follows:
(D) FOR PURPOSES OF THIS SECTION, THE TERM "PRIOR RIGHT" SHALL MEAN
THE PREFERENTIAL RIGHT TO IMPOSE ANY TAX DESCRIBED IN SECTIONS TWELVE
HUNDRED TWO AND TWELVE HUNDRED THREE, OR TWELVE HUNDRED TEN AND TWELVE
HUNDRED ELEVEN, OF THIS ARTICLE AND THEREBY TO PREEMPT SUCH TAX AND TO
PRECLUDE ANOTHER MUNICIPAL CORPORATION FROM IMPOSING OR CONTINUING THE
IMPOSITION OF SUCH TAX TO THE EXTENT THAT SUCH RIGHT IS EXERCISED.
HOWEVER, THE RIGHT OF PREEMPTION SHALL ONLY APPLY WITHIN THE TERRITORIAL
LIMITS OF THE TAXING JURISDICTION HAVING THE RIGHT OR PREEMPTION.
(E) EACH OF THE FOLLOWING COUNTIES AND CITIES SHALL HAVE THE SOLE
RIGHT TO IMPOSE THE FOLLOWING ADDITIONAL RATE OF SALES AND COMPENSATING
USE TAXES IN EXCESS OF THREE PERCENT THAT SUCH COUNTY OR CITY IS AUTHOR-
IZED TO IMPOSE PURSUANT TO THE AUTHORITY OF SUBDIVISION (A) OF SECTION
TWELVE HUNDRED TEN OF THIS ARTICLE. SUCH ADDITIONAL RATES OF TAX SHALL
NOT BE SUBJECT TO PREEMPTION.
(1) COUNTIES:
(A) ONE-QUARTER OF ONE PERCENT - NONE.
(B) ONE-HALF OF ONE PERCENT - CHAUTAUQUA, ONTARIO, SCHENECTADY.
(C) THREE-QUARTERS OF ONE PERCENT - DUTCHESS, ESSEX, JEFFERSON, LEWIS,
ORANGE.
(D) ONE PERCENT - ALBANY, BROOME, CATTARAUGUS, CHEMUNG, CHENANGO,
CLINTON, COLUMBIA, DELAWARE, FRANKLIN, GENESEE, GREENE, LIVINGSTON,
MONROE, MONTGOMERY, NIAGARA, ONONDAGA, ORLEANS, OTSEGO, PUTNAM, RENSSE-
LAER, ROCKLAND, SCHOHARIE, SCHUYLER, SENECA, STEUBEN, SUFFOLK, SULLIVAN,
TIOGA, TOMPKINS, ULSTER, WAYNE, WYOMING, YATES.
(E) ONE AND ONE-QUARTER PERCENT - HERKIMER, NASSAU.
(F) ONE AND ONE-HALF PERCENT - ALLEGANY.
(G) ONE AND THREE-QUARTERS PERCENT - ERIE, ONEIDA.
(2) CITIES:
(A) ONE-QUARTER OF ONE PERCENT - NONE.
(B) ONE-HALF OF ONE PERCENT - NONE.
(C) THREE-QUARTERS OF ONE PERCENT - NONE.
(D) ONE PERCENT - MOUNT VERNON, NEW ROCHELLE, WHITE PLAINS, YONKERS.
(F) EACH OF THE FOLLOWING CITIES IS AUTHORIZED TO PREEMPT THE TAXES
IMPOSED BY THE COUNTY IN WHICH IT IS LOCATED PURSUANT TO THE AUTHORITY
OF SUBDIVISION (A) OF SECTION TWELVE HUNDRED TEN OF THIS ARTICLE, TO THE
EXTENT OF ONE-HALF THE MAXIMUM AGGREGATE RATE AUTHORIZED UNDER SECTION
TWELVE HUNDRED TEN OF THIS ARTICLE, INCLUDING THE ADDITIONAL RATE THAT
THE COUNTY IN WHICH SUCH CITY IS LOCATED IS AUTHORIZED TO IMPOSE:
AUBURN, IN CAYUGA COUNTY; CORTLAND, IN CORTLAND COUNTY; GLOVERSVILLE AND
JOHNSTOWN, IN FULTON COUNTY; ONEIDA, IN MADISON COUNTY; ONEONTA, IN
OTSEGO COUNTY. AS OF THE DATE THIS SUBDIVISION TAKES EFFECT, ANY SUCH
PREEMPTION BY SUCH A CITY IN EFFECT ON SUCH DATE SHALL CONTINUE IN FULL
FORCE AND EFFECT UNTIL THE EFFECTIVE DATE OF A LOCAL LAW, ORDINANCE, OR
RESOLUTION ADOPTED OR AMENDED BY THE CITY TO CHANGE SUCH PREEMPTION,
PROVIDED SUCH A CITY'S RATE OF TAX IN EXCESS OF ONE AND ONE-HALF PERCENT
SHALL NOT CONTINUE IN EFFECT IF THE COUNTY IN WHICH IT IS LOCATED DOES
S. 2609--B 86 A. 3009--B
NOT EXTEND ITS ADDITIONAL RATE IN EXCESS OF THREE PERCENT. ANY
PREEMPTION BY SUCH A CITY TO TAKE EFFECT UNDER THIS SUBDIVISION AFTER
THE DATE THIS SUBDIVISION TAKES EFFECT SHALL BE SUBJECT TO THE NOTICE
REQUIREMENTS IN SECTION TWELVE HUNDRED TWENTY-THREE OF THIS SUBPART AND
TO THE OTHER REQUIREMENTS OF THIS ARTICLE.
(G) NOTWITHSTANDING THE FOREGOING PROVISIONS OF THIS SECTION OR OTHER
LAW, IF THE COUNTY OF DUTCHESS WITHDRAWS FROM THE METROPOLITAN COMMUTER
TRANSPORTATION DISTRICT AND IMPOSES THE ADDITIONAL THREE-EIGHTHS PERCENT
RATE OF TAX, THE NET COLLECTIONS FROM WHICH THE COUNTY HAS SET ASIDE FOR
MASS TRANSPORTATION PURPOSES, AS AUTHORIZED BY SUBPARAGRAPH (IV) OF THE
OPENING PARAGRAPH OF SECTION TWELVE HUNDRED TEN OF THIS ARTICLE, SUCH
ADDITIONAL THREE-EIGHTHS PERCENT RATE OF TAX SHALL BE IN ADDITION TO ANY
OTHER ADDITIONAL RATE OF TAX SUCH COUNTY IS AUTHORIZED TO IMPOSE AND
SHALL NOT BE SUBJECT TO PREEMPTION AND SUCH COUNTY SHALL NOT INCLUDE
SUCH ADDITIONAL THREE-EIGHTHS PERCENT RATE OF TAX IN DETERMINING ITS
ADDITIONAL RATE OF TAX ON THE AREA OF THE COUNTY OUTSIDE ANY CITY IN THE
COUNTY IMPOSING TAX FOR PURPOSES OF SUBDIVISION (D) OF SECTION TWELVE
HUNDRED SIXTY-TWO OF THIS ARTICLE.
S 8. The tax law is amended by adding three new sections 1262-t,
1262-u, and 1262-v to read as follows:
S 1262-T. ONEIDA COUNTY NET COLLECTIONS FROM ADDITIONAL RATE OF TAX.
NET COLLECTIONS FROM AN ADDITIONAL THREE-QUARTERS PERCENT RATE OF ONEIDA
COUNTY'S SALES AND COMPENSATING USE TAXES IMPOSED PURSUANT TO THE
AUTHORITY OF CLAUSE TWO OF SUBPARAGRAPH (I) OF THE OPENING PARAGRAPH OF
SECTION TWELVE HUNDRED TEN OF THIS ARTICLE SHALL NOT BE SUBJECT TO ANY
REVENUE DISTRIBUTION AGREEMENT ENTERED INTO BY THE COUNTY AND THE CITIES
IN THE COUNTY UNDER SUBDIVISION (C) OF SECTION TWELVE HUNDRED SIXTY-TWO
OF THIS PART.
S 1262-U. CLINTON COUNTY NET COLLECTIONS FROM ADDITIONAL RATE OF TAX.
NET COLLECTIONS FROM ANY ADDITIONAL RATE OF SALES AND COMPENSATING USE
TAXES CLINTON COUNTY IMPOSES PURSUANT TO THE AUTHORITY OF CLAUSE TWO OF
SUBPARAGRAPH (I) OF THE OPENING PARAGRAPH OF SECTION TWELVE HUNDRED TEN
OF THIS ARTICLE SHALL BE PAID TO THE COUNTY AND THE COUNTY SHALL SET
ASIDE SUCH NET COLLECTIONS AND USE THEM SOLELY FOR COUNTY PURPOSES. SUCH
NET COLLECTIONS SHALL NOT BE SUBJECT TO ANY REVENUE DISTRIBUTION AGREE-
MENT ENTERED INTO BY THE COUNTY AND THE CITY IN THE COUNTY UNDER SUBDI-
VISION (C) OF SECTION TWELVE HUNDRED SIXTY-TWO OF THIS PART.
S 1262-V. ONTARIO COUNTY NET COLLECTIONS FROM ADDITIONAL RATE OF TAX.
NOTWITHSTANDING ANY LAW TO THE CONTRARY, AFTER ONTARIO COUNTY ALLOCATES
NET COLLECTIONS FROM ITS ADDITIONAL ONE-EIGHTH OF ONE PERCENT RATE OF
SALES AND COMPENSATING USE TAXES PURSUANT TO THE AUTHORITY OF SECTION
TWELVE HUNDRED SIXTY-TWO-R OF THIS PART, AS ADDED BY CHAPTER THIRTY-SEV-
EN OF THE LAWS OF TWO THOUSAND SIX, NET COLLECTIONS FROM THE COUNTY'S
ADDITIONAL THREE-EIGHTHS OF ONE PERCENT RATE OF SUCH TAXES SHALL BE SET
ASIDE FOR COUNTY PURPOSES AND SHALL NOT BE SUBJECT TO ANY AGREEMENT
ENTERED INTO BY THE COUNTY AND THE CITIES IN THE COUNTY UNDER SUBDIVI-
SION (C) OF SECTION TWELVE HUNDRED SIXTY-TWO OR SECTION TWELVE HUNDRED
SIXTY-TWO-R OF THIS PART, AS ADDED BY CHAPTER THIRTY-SEVEN OF THE LAWS
OF TWO THOUSAND SIX.
S 9. Section 1262-s of the tax law, as amended by chapter 226 of the
laws of 2011, is amended to read as follows:
S 1262-s. Disposition of net collections from the additional one-quar-
ter of one percent rate of sales and compensating use taxes in the coun-
ty of Herkimer. Notwithstanding any contrary provision of law, if the
county of Herkimer imposes the additional one-quarter of one percent
rate of sales and compensating use taxes IN EXCESS OF FOUR PERCENT
S. 2609--B 87 A. 3009--B
authorized by [section twelve hundred ten-E] THE OPENING PARAGRAPH OF
SECTION TWELVE HUNDRED TEN of this article [for all or any portion of
the period beginning December first, two thousand seven and ending
November thirtieth, two thousand thirteen], the county shall use all net
collections from such additional one-quarter of one percent rate to pay
the county's expenses for the construction of additional correctional
facilities. The net collections from [the] SUCH additional rate imposed
[pursuant to section twelve hundred ten-E] shall be deposited in a
special fund to be created by such county separate and apart from any
other funds and accounts of the county. Any and all remaining net
collections from such additional tax, after the expenses of such
construction are paid, shall be deposited by the county of Herkimer in
the general fund of such county for any county purpose.
S 10. The tax law is amended by adding a new section 1265 to read as
follows:
S 1265. REFERENCES TO CERTAIN PROVISIONS AUTHORIZING ADDITIONAL RATES
OR TO EXPIRATIONS OF A PERIOD. NOTWITHSTANDING ANY PROVISION OF LAW TO
THE CONTRARY: ANY REFERENCE IN ANY SECTION OF THIS CHAPTER OR OTHER LAW,
OR IN ANY LOCAL LAW, ORDINANCE, OR RESOLUTION ADOPTED PURSUANT TO THE
AUTHORITY OF THIS ARTICLE, OR IN ANY AGREEMENT ENTERED INTO BY A COUNTY
AND ALL THE CITIES IN THAT COUNTY UNDER SUBDIVISION (C) OF SECTION
TWELVE HUNDRED SIXTY-TWO OF THIS PART, TO NET COLLECTIONS OR REVENUES
FROM A TAX IMPOSED BY A COUNTY OR CITY PURSUANT TO THE AUTHORITY OF A
CLAUSE, OR TO A SUBCLAUSE OF A CLAUSE, OF SUBPARAGRAPH (I) OR (II) OF
THE OPENING PARAGRAPH OF SECTION TWELVE HUNDRED TEN OF THIS ARTICLE
REPEALED BY SECTION ONE OR TWO OF THE CHAPTER OF THE LAWS OF TWO THOU-
SAND THIRTEEN THAT ADDED THIS SECTION OR TO SECTION TWELVE HUNDRED TEN-E
OF THIS ARTICLE REPEALED BY SECTION FIVE OF SUCH CHAPTER OF THE LAWS OF
TWO THOUSAND THIRTEEN SHALL BE DEEMED TO BE A REFERENCE TO NET
COLLECTIONS OR REVENUES FROM A TAX IMPOSED BY THAT COUNTY OR CITY PURSU-
ANT TO THE AUTHORITY OF THE EQUIVALENT PROVISION OF CLAUSE TWO OF
SUBPARAGRAPH (I) OR TO SUBPARAGRAPH (II) OF THE OPENING PARAGRAPH OF
SUCH SECTION TWELVE HUNDRED TEN AS ADDED BY SUCH SECTION ONE OR TWO OF
SUCH CHAPTER OF THE LAWS OF TWO THOUSAND THIRTEEN.
S 11. Severability. If any provision of this act shall for any reason
be finally adjudged by any court of competent jurisdiction to be inval-
id, such judgment shall not affect, impair, or invalidate the remainder
of this act, but shall be confined in its operation to the provision
directly involved in the controversy in which such judgment shall have
been rendered. It it hereby declared to be the intent of the legislature
that this act would have been enacted even if such invalid provision had
not been included in this act.
S 12. This act shall take effect immediately.
PART S
Section 1. Paragraph 1 of subdivision a of section 1612 of the tax
law, as amended by chapter 147 of the laws of 2010, subparagraph (A) as
amended by section 1 of part S of chapter 59 of the laws of 2012, is
amended to read as follows:
(1) sixty percent of the total amount for which tickets have been sold
for [a lawful lottery] THE QUICK DRAW game [introduced on or after the
effective date of this paragraph,] subject to [the following provisions:
(A) such game shall be available only on premises occupied by licensed
lottery sales agents, subject to the following provisions:
S. 2609--B 88 A. 3009--B
(i) if the licensee does not hold a license issued pursuant to the
alcoholic beverage control law to sell alcoholic beverages for consump-
tion on the premises, then the premises must have a minimum square
footage greater than two thousand five hundred square feet;
(ii) notwithstanding the foregoing provisions, television equipment
that automatically displays the results of such drawings may be
installed and used without regard to the square footage if such premises
are used as:
(I) a commercial bowling establishment, or
(II) a facility authorized under the racing, pari-mutuel wagering and
breeding law to accept pari-mutuel wagers;
(B) the] rules for the operation of such game [shall be] as prescribed
by regulations promulgated and adopted by the division[, provided howev-
er, that such rules shall provide that no person under the age of twen-
ty-one may participate in such games on the premises of a licensee who
holds a license issued pursuant to the alcoholic beverage control law to
sell alcoholic beverages for consumption on the premises; and, provided,
further, that such regulations may be revised on an emergency basis not
later than ninety days after the enactment of this paragraph in order to
conform such regulations to the requirements of this paragraph]; or
S 2. This act shall take effect immediately.
PART T
Section 1. Clause (F) of subparagraph (ii) of paragraph 1 of subdivi-
sion b of section 1612 of the tax law, as amended by section 6 of part K
of chapter 57 of the laws of 2010, is amended to read as follows:
(F) notwithstanding clauses (A), (B), (C), (D) and (E) of this subpar-
agraph, when a vendor track, is located in Sullivan county and within
sixty miles from any gaming facility in a contiguous state such vendor
fee shall, for a period of [five] SIX years commencing April first, two
thousand eight, be at a rate of forty-one percent of the total revenue
wagered at the vendor track after payout for prizes pursuant to this
chapter, after which time such rate shall be as for all tracks in clause
(C) of this subparagraph.
S 2. This act shall take effect immediately and shall be deemed to
have been in full force and effect on and after April 1, 2013.
PART U
Section 1. Paragraph (a) of subdivision 1 of section 1003 of the
racing, pari-mutuel wagering and breeding law, as amended by section 1
of part O of chapter 59 of the laws of 2012, is amended to read as
follows:
(a) Any racing association or corporation or regional off-track
betting corporation, authorized to conduct pari-mutuel wagering under
this chapter, desiring to display the simulcast of horse races on which
pari-mutuel betting shall be permitted in the manner and subject to the
conditions provided for in this article may apply to the board for a
license so to do. Applications for licenses shall be in such form as may
be prescribed by the board and shall contain such information or other
material or evidence as the board may require. No license shall be
issued by the board authorizing the simulcast transmission of thorough-
bred races from a track located in Suffolk county. The fee for such
licenses shall be five hundred dollars per simulcast facility per year
payable by the licensee to the board for deposit into the general fund.
S. 2609--B 89 A. 3009--B
Except as provided herein, the board shall not approve any application
to conduct simulcasting into individual or group residences, homes or
other areas for the purposes of or in connection with pari-mutuel wager-
ing. The board may approve simulcasting into residences, homes or other
areas to be conducted jointly by one or more regional off-track betting
corporations and one or more of the following: a franchised corporation,
thoroughbred racing corporation or a harness racing corporation or asso-
ciation; provided (i) the simulcasting consists only of those races on
which pari-mutuel betting is authorized by this chapter at one or more
simulcast facilities for each of the contracting off-track betting
corporations which shall include wagers made in accordance with section
one thousand fifteen, one thousand sixteen and one thousand seventeen of
this article; provided further that the contract provisions or other
simulcast arrangements for such simulcast facility shall be no less
favorable than those in effect on January first, two thousand five; (ii)
that each off-track betting corporation having within its geographic
boundaries such residences, homes or other areas technically capable of
receiving the simulcast signal shall be a contracting party; (iii) the
distribution of revenues shall be subject to contractual agreement of
the parties except that statutory payments to non-contracting parties,
if any, may not be reduced; provided, however, that nothing herein to
the contrary shall prevent a track from televising its races on an
irregular basis primarily for promotional or marketing purposes as found
by the board. For purposes of this paragraph, the provisions of section
one thousand thirteen of this article shall not apply. Any agreement
authorizing an in-home simulcasting experiment commencing prior to May
fifteenth, nineteen hundred ninety-five, may, and all its terms, be
extended [until June thirtieth, two thousand thirteen]; provided, howev-
er, that any party to such agreement may elect to terminate such agree-
ment upon conveying written notice to all other parties of such agree-
ment at least forty-five days prior to the effective date of the
termination, via registered mail. Any party to an agreement receiving
such notice of an intent to terminate, may request the board to mediate
between the parties new terms and conditions in a replacement agreement
between the parties as will permit continuation of an in-home experiment
[until June thirtieth, two thousand thirteen]; and (iv) no in-home
simulcasting in the thoroughbred special betting district shall occur
without the approval of the regional thoroughbred track.
S 2. Subparagraph (iii) of paragraph d of subdivision 3 of section
1007 of the racing, pari-mutuel wagering and breeding law, as amended by
section 2 of part O of chapter 59 of the laws of 2012, is amended to
read as follows:
(iii) Of the sums retained by a receiving track located in Westchester
county on races received from a franchised corporation, for the period
commencing January first, two thousand eight [and continuing through
June thirtieth, two thousand thirteen], the amount used exclusively for
purses to be awarded at races conducted by such receiving track shall be
computed as follows: of the sums so retained, two and one-half percent
of the total pools. Such amount shall be increased or decreased in the
amount of fifty percent of the difference in total commissions deter-
mined by comparing the total commissions available after July twenty-
first, nineteen hundred ninety-five to the total commissions that would
have been available to such track prior to July twenty-first, nineteen
hundred ninety-five.
S 3. Section 1014 of the racing, pari-mutuel wagering and breeding law
is REPEALED.
S. 2609--B 90 A. 3009--B
S 4. Subdivision 1 of section 1015 of the racing, pari-mutuel wagering
and breeding law, as amended by section 4 of part O of chapter 59 of the
laws of 2012, is amended to read as follows:
1. The provisions of this section shall govern the simulcasting of
races conducted at harness tracks located in another state or country
during the period COMMENCING July first, nineteen hundred ninety-four
[through June thirtieth, two thousand thirteen]. This section shall
supersede all inconsistent provisions of this chapter.
S 5. The opening paragraph of subdivision 1 of section 1016 of the
racing, pari-mutuel wagering and breeding law, as amended by section 5
of part O of chapter 59 of the laws of 2012, is amended to read as
follows:
The provisions of this section shall govern the simulcasting of races
conducted at thoroughbred tracks located in another state or country on
any day during which a franchised corporation is not conducting a race
meeting in Saratoga county at Saratoga thoroughbred racetrack [until
June thirtieth, two thousand thirteen]. Every off-track betting corpo-
ration branch office and every simulcasting facility licensed in accord-
ance with section one thousand seven that have entered into a written
agreement with such facility's representative horsemen's organization as
approved by the board, one thousand eight or one thousand nine of this
article shall be authorized to accept wagers and display the live full-
card simulcast signal of thoroughbred tracks (which may include quarter
horse or mixed meetings provided that all such wagering on such races
shall be construed to be thoroughbred races) located in another state or
foreign country, subject to the following provisions; provided, however,
no such written agreement shall be required of a franchised corporation
licensed in accordance with section one thousand seven of this article:
S 6. The opening paragraph of section 1018 of the racing, pari-mutuel
wagering and breeding law, as amended by section 6 of part O of chapter
59 of the laws of 2012, is amended to read as follows:
Notwithstanding any other provision of this chapter, for the period
COMMENCING July twenty-fifth, two thousand one [through September
eighth, two thousand twelve], when a franchised corporation is conduct-
ing a race meeting within the state at Saratoga Race Course, every off-
track betting corporation branch office and every simulcasting facility
licensed in accordance with section one thousand seven (that has entered
into a written agreement with such facility's representative horsemen's
organization as approved by the board), one thousand eight or one thou-
sand nine of this article shall be authorized to accept wagers and
display the live simulcast signal from thoroughbred tracks located in
another state, provided that such facility shall accept wagers on races
run at all in-state thoroughbred tracks which are conducting racing
programs subject to the following provisions; provided, however, no such
written agreement shall be required of a franchised corporation licensed
in accordance with section one thousand seven of this article.
S 7. Section 32 of chapter 281 of the laws of 1994, amending the
racing, pari-mutuel wagering and breeding law and other laws relating
to simulcasting, as amended by section 7 of part O of chapter 59 of the
laws of 2012, is amended to read as follows:
S 32. This act shall take effect immediately [and the pari-mutuel tax
reductions in section six of this act shall expire and be deemed
repealed on July 1, 2013]; provided, however, that nothing contained
herein shall be deemed to affect the application, qualification, expira-
tion, or repeal of any provision of law amended by any section of this
act, and such provisions shall be applied or qualified or shall expire
S. 2609--B 91 A. 3009--B
or be deemed repealed in the same manner, to the same extent and on the
same date as the case may be as otherwise provided by law; provided
further, however, that sections twenty-three and twenty-five of this act
shall remain in full force and effect only until May 1, 1997 and at such
time shall be deemed to be repealed.
S 8. Section 54 of chapter 346 of the laws of 1990, amending the
racing, pari-mutuel wagering and breeding law and other laws relating to
simulcasting and the imposition of certain taxes, as amended by section
8 of part O of chapter 59 of the laws of 2012, is amended to read as
follows:
S 54. This act shall take effect immediately; provided, however,
sections three through twelve of this act shall take effect on January
1, 1991, and [section 1013 of the racing, pari-mutuel wagering and
breeding law, as added by section thirty-eight of this act, shall expire
and be deemed repealed on July 1, 2013; and] section eighteen of this
act shall take effect on July 1, 2008 and sections fifty-one and fifty-
two of this act shall take effect as of the same date as chapter 772 of
the laws of 1989 took effect.
S 9. Paragraph (a) of subdivision 1 of section 238 of the racing,
pari-mutuel wagering and breeding law, as amended by section 9 of part O
of chapter 59 of the laws of 2012, is amended to read as follows:
(a) The franchised corporation authorized under this chapter to
conduct pari-mutuel betting at a race meeting or races run thereat shall
distribute all sums deposited in any pari-mutuel pool to the holders of
winning tickets therein, provided such tickets be presented for payment
before April first of the year following the year of their purchase,
less an amount which shall be established and retained by such fran-
chised corporation of between twelve to seventeen per centum of the
total deposits in pools resulting from on-track regular bets, and four-
teen to twenty-one per centum of the total deposits in pools resulting
from on-track multiple bets and fifteen to twenty-five per centum of the
total deposits in pools resulting from on-track exotic bets and fifteen
to thirty-six per centum of the total deposits in pools resulting from
on-track super exotic bets, plus the breaks. The retention rate to be
established is subject to the prior approval of the racing and wagering
board. Such rate may not be changed more than once per calendar quarter
to be effective on the first day of the calendar quarter. "Exotic bets"
and "multiple bets" shall have the meanings set forth in section five
hundred nineteen of this chapter. "Super exotic bets" shall have the
meaning set forth in section three hundred one of this chapter. For
purposes of this section, a "pick six bet" shall mean a single bet or
wager on the outcomes of six races. The breaks are hereby defined as the
odd cents over any multiple of five for payoffs greater than one dollar
five cents but less than five dollars, over any multiple of ten for
payoffs greater than five dollars but less than twenty-five dollars,
over any multiple of twenty-five for payoffs greater than twenty-five
dollars but less than two hundred fifty dollars, or over any multiple of
fifty for payoffs over two hundred fifty dollars. Out of the amount so
retained there shall be paid by such franchised corporation to the
commissioner of taxation and finance, as a reasonable tax by the state
for the privilege of conducting pari-mutuel betting on the races run at
the race meetings held by such franchised corporation, the following
percentages of the total pool for regular and multiple bets five per
centum of regular bets and four per centum of multiple bets plus twenty
per centum of the breaks; for exotic wagers seven and one-half per
centum plus twenty per centum of the breaks, and for super exotic bets
S. 2609--B 92 A. 3009--B
seven and one-half per centum plus fifty per centum of the breaks. For
the period June first, nineteen hundred ninety-five through September
ninth, nineteen hundred ninety-nine, such tax on regular wagers shall be
three per centum and such tax on multiple wagers shall be two and one-
half per centum, plus twenty per centum of the breaks. For the period
September tenth, nineteen hundred ninety-nine through March thirty-
first, two thousand one, such tax on all wagers shall be two and six-
tenths per centum and for the period COMMENCING April first, two thou-
sand one [through December thirty-first, two thousand thirteen], such
tax on all wagers shall be one and six-tenths per centum, plus, in each
such period, twenty per centum of the breaks. Payment to the New York
state thoroughbred breeding and development fund by such franchised
corporation shall be one-half of one per centum of total daily on-track
pari-mutuel pools resulting from regular, multiple and exotic bets and
three per centum of super exotic bets provided, however, that for the
period September tenth, nineteen hundred ninety-nine through March thir-
ty-first, two thousand one, such payment shall be six-tenths of one per
centum of regular, multiple and exotic pools and for the period COMMENC-
ING April first, two thousand one [through December thirty-first, two
thousand thirteen], such payment shall be seven-tenths of one per centum
of such pools.
S 10. Subdivision 5 of section 1012 of the racing, pari-mutuel wager-
ing and breeding law is REPEALED.
S 11. This act shall take effect immediately.
PART V
Section 1. Subparagraphs (A) and (B) of paragraph 2 of subsection (pp)
of section 606 of the tax law, as amended by chapter 472 of the laws of
2010, are amended to read as follows:
(A) With respect to any particular residence of a taxpayer, the credit
allowed under paragraph one of this subsection shall not exceed fifty
thousand dollars for taxable years beginning on or after January first,
two thousand ten and before January first, two thousand [fifteen] TWENTY
and twenty-five thousand dollars for taxable years beginning on or after
January first, two thousand [fifteen] TWENTY. In the case of a husband
and wife, the amount of the credit shall be divided between them equally
or in such other manner as they may both elect. If a taxpayer incurs
qualified rehabilitation expenditures in relation to more than one resi-
dence in the same year, the total amount of credit allowed under para-
graph one of this subsection for all such expenditures shall not exceed
fifty thousand dollars for taxable years beginning on or after January
first, two thousand ten and before January first, two thousand [fifteen]
TWENTY and twenty-five thousand dollars for taxable years beginning on
or after January first, two thousand [fifteen] TWENTY.
(B) For taxable years beginning on or after January first, two thou-
sand ten and before January first, two thousand [fifteen] TWENTY, if the
amount of credit allowable under this subsection shall exceed the
taxpayer's tax for such year, and the taxpayer's New York adjusted gross
income for such year does not exceed sixty thousand dollars, 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. If
the taxpayer's New York adjusted gross income for such year exceeds
sixty thousand dollars, the excess credit that may be carried over to
the following year or years and may be deducted from the taxpayer's tax
S. 2609--B 93 A. 3009--B
for such year or years. For taxable years beginning on or after January
first, two thousand [fifteen] TWENTY, if the amount of credit allowable
under this subsection shall exceed the taxpayer's tax for such year, the
excess may be carried over to the following year or years and may be
deducted from the taxpayer's tax for such year or years.
S 2. This act shall take effect immediately.
PART W
Section 1. Subdivision 13 of section 282 of the tax law, as added by
chapter 276 of the laws of 1986, is amended to read as follows:
13. "Terminal" means a motor fuel OR DIESEL MOTOR FUEL storage facili-
ty with a storage capacity of fifty thousand gallons or more excluding
such facility at which motor fuel OR DIESEL MOTOR FUEL is stored solely
for its retail sale at such facility. "Terminal operator" means any
person who or which has the use of or control over, or the right to so
use or control, a terminal.
S 2. Subdivision 1 of section 282-a of the tax law, as amended by
chapter 2 of the laws of 1995, is amended to read as follows:
1. There is hereby levied and imposed with respect to Diesel motor
fuel an excise tax of four cents per gallon upon the sale or use of
Diesel motor fuel in this state.
The excise tax is imposed on the first sale or use of Diesel motor
fuel to occur which is not exempt from tax under this article. Provided,
however, if the tax has not been imposed prior thereto, it shall be
imposed on THE REMOVAL OF HIGHWAY DIESEL MOTOR FUEL FROM A TERMINAL,
OTHER THAN BY PIPELINE, BARGE, TANKER OR OTHER VESSEL, OR the delivery
of Diesel motor fuel to a filling station or into the fuel tank connect-
ing with the engine of a motor vehicle for use in the operation thereof
whichever event shall be first to occur. The tax shall be computed based
upon the number of gallons of Diesel motor fuel sold, REMOVED or used or
the number of gallons of Diesel fuel delivered into the fuel tank of a
motor vehicle, as the case may be. Nothing in this article shall be
construed to require the payment of such excise tax more than once upon
the same Diesel motor fuel. Nor shall the collection of such tax be made
applicable to the sale or use of Diesel motor fuel under circumstances
which preclude the collection of such tax by reason of the United States
constitution and of laws of the United States enacted pursuant thereto.
Provided, further, no Diesel motor fuel shall be included in the measure
of the tax unless it shall have previously come to rest within the mean-
ing of federal decisional law interpreting the United States constitu-
tion. All tax for the period for which a return is required to be filed
shall be due on the date limited for the filing of the return for such
period, regardless of whether a return is filed as required by this
article or whether the return which is filed correctly shows the amount
of tax due.
S 3. Paragraph (b) of subdivision 3 of section 282-a of the tax law,
as amended by section 2 of part E of chapter 59 of the laws of 2012, is
amended to read as follows:
(b) The tax on the incidence of sale or use imposed by subdivision one
of this section shall not apply to: (i) the sale or use of non-highway
Diesel motor fuel, but only if all of such fuel is consumed other than
on the public highways of this state (except for the use of the public
highway by farmers to reach adjacent farmlands); provided, however, this
exemption shall in no event apply to a sale of non-highway Diesel motor
fuel which involves a delivery at a filling station or into a repository
S. 2609--B 94 A. 3009--B
which is equipped with a hose or other apparatus by which such fuel can
be dispensed into the fuel tank of a motor vehicle (except for delivery
at a farm site which qualifies for the exemption under subdivision (g)
of section three hundred one-b of this chapter); or (ii) a sale to the
consumer consisting of not more than twenty gallons of water-white kero-
sene to be used and consumed exclusively for heating purposes; or (iii)
the sale to or delivery at a filling station or other retail vendor of
water-white kerosene provided such filling station or other retail
vendor only sells such water-white kerosene exclusively for heating
purposes in containers of no more than twenty gallons; or (iv) a sale of
kero-jet fuel to an airline for use in its airplanes or a use of kero-
jet fuel by an airline in its airplanes; or (v) a sale of kero-jet fuel
by a registered distributor of Diesel motor fuel to a fixed base opera-
tor registered under this article as a distributor of kero-jet fuel only
where such fixed base operator is engaged solely in making or offering
to make retail sales not in bulk of kero-jet fuel directly into the fuel
tank of an airplane for the purpose of operating such airplane; OR (vi)
a retail sale not in bulk of kero-jet fuel by a fixed base operator
registered under this article as a distributor of kero-jet fuel only
where such fuel is delivered directly into the fuel tank of an airplane
for use in the operation of such airplane; or (vii) the sale of previ-
ously untaxed qualified biodiesel to a person registered under this
article as a distributor of Diesel motor fuel other than (A) a retail
sale to such person or (B) a sale to such person which involves a deliv-
ery at a filling station or into a repository which is equipped with a
hose or other apparatus by which such qualified biodiesel can be
dispensed into the fuel tank of a motor vehicle; OR (VIII) THE SALE OF
PREVIOUSLY UNTAXED HIGHWAY DIESEL MOTOR FUEL BY A PERSON REGISTERED
UNDER THIS ARTICLE AS A DISTRIBUTOR OF DIESEL MOTOR FUEL TO A PERSON
REGISTERED UNDER THIS ARTICLE AS A DISTRIBUTOR OF DIESEL MOTOR FUEL
WHERE THE HIGHWAY DIESEL MOTOR FUEL IS EITHER: (A) BEING DELIVERED BY
PIPELINE, RAILCAR, BARGE, TANKER OR OTHER VESSEL TO A TERMINAL, THE
OPERATOR OF WHICH TERMINAL IS REGISTERED UNDER SECTION TWO HUNDRED
EIGHTY-THREE-B OF THIS ARTICLE, OR (B) WITHIN SUCH A TERMINAL WHERE IT
HAS BEEN SO DELIVERED. PROVIDED, HOWEVER, THAT THE EXEMPTION SET FORTH
IN THIS SUBPARAGRAPH SHALL NOT APPLY TO ANY HIGHWAY DIESEL MOTOR FUEL IF
IT IS REMOVED FROM A TERMINAL, OTHER THAN BY PIPELINE, BARGE, TANKER OR
OTHER VESSEL.
S 4. Subdivision 5 of section 282-a of the tax law, as amended by
section 5 of part K of chapter 61 of the laws of 2011, is amended to
read as follows:
5. All the provisions of this article relating to the administration
and collection of the taxes on motor fuel, except [sections] SECTION two
hundred eighty-three-a [and two hundred eighty-three-b] of this article,
shall be applicable to the tax imposed by this section with such limita-
tion as specifically provided for in this article with respect to Diesel
motor fuel and with such modification as may be necessary to adapt the
language of such provisions to the tax imposed by this section. With
respect to the bond or other security required by subdivision three of
section two hundred eighty-three of this article, the commissioner, in
determining the amount of bond or other security required for the
purpose of securing tax payments, shall take into account the volume of
non-highway Diesel motor fuel and other Diesel motor fuel sold for
exempt purposes by a distributor of Diesel motor fuel during prior peri-
ods as a factor reducing potential tax liability along with any other
relevant factors in determining the amount of security required. With
S. 2609--B 95 A. 3009--B
respect to the bond required to be filed prior to registration as a
Diesel motor fuel distributor, no bond shall be required of an applicant
upon a finding of the applicant's fiscal responsibility, as reflected by
such factors as net worth, current assets and liabilities, and tax
reporting and payment history, and the department shall not provide for
a minimum bond of every applicant.
S 5. Section 300 of the tax law is amended by adding a new subdivision
(s) to read as follows:
(S) THE TERM "TERMINAL" SHALL HAVE THE SAME MEANING AS IN SUBDIVISION
THIRTEEN OF SECTION TWO HUNDRED EIGHTY-TWO OF THIS CHAPTER.
S 6. Subparagraph (A) of paragraph 1 of subdivision (c) of section
301-a of the tax law, as amended by section 19 of part K of chapter 61
of the laws of 2011, is amended to read as follows:
(A) The highway diesel motor fuel component shall be determined by
multiplying the motor fuel and highway diesel motor fuel rate times (1)
the number of gallons of highway diesel motor fuel sold or used by a
petroleum business in this state during the month covered by the return
under this article and (2) with respect to any gallonage which prior
thereto has not been included in the measure of the tax imposed by this
article, times the number of gallons of highway diesel motor fuel
[delivered] (i) REMOVED FROM A TERMINAL, OTHER THAN BY PIPELINE, BARGE,
TANKER OR OTHER VESSEL, (II) DELIVERED to a filling station or [(ii)],
(III) DELIVERED into the fuel tank connecting with the engine of a motor
vehicle for use in the operation thereof, whichever of the latter [two]
THREE events shall be the first to occur. Provided, however, that no
highway diesel motor fuel shall be included in the measure of the tax
unless it shall have previously come to rest within the meaning of
federal decisional law interpreting the United States constitution, nor
decisional law, nor shall any highway diesel motor fuel be included in
the measure of the tax imposed by this article more than once.
S 7. Subdivision (e) of section 301-b of the tax law, as amended by
section 4 of part E of chapter 59 of the laws of 2012, is amended to
read as follows:
(e) Sales of HIGHWAY DIESEL MOTOR FUEL, qualified biodiesel, non-high-
way diesel motor fuel and residual petroleum product to registered
distributors of diesel motor fuel and registered residual petroleum
product businesses.
(1) THE SALE OF PREVIOUSLY UNTAXED HIGHWAY DIESEL MOTOR FUEL BY A
PERSON REGISTERED UNDER ARTICLE TWELVE-A OF THIS CHAPTER AS A DISTRIBU-
TOR OF DIESEL MOTOR FUEL TO A PERSON REGISTERED UNDER SUCH ARTICLE
TWELVE-A AS A DISTRIBUTOR OF DIESEL MOTOR FUEL WHERE THE HIGHWAY DIESEL
MOTOR FUEL IS EITHER: (A) BEING DELIVERED BY PIPELINE, RAILCAR, BARGE,
TANKER OR OTHER VESSEL TO A TERMINAL, THE OPERATOR OF WHICH TERMINAL IS
REGISTERED UNDER SECTION TWO HUNDRED EIGHTY-THREE-B OF THIS CHAPTER, OR
(B) WITHIN SUCH A TERMINAL WHERE IT HAS BEEN SO DELIVERED. PROVIDED,
HOWEVER, THAT THE EXEMPTION SET FORTH IN THIS PARAGRAPH SHALL NOT APPLY
TO ANY HIGHWAY DIESEL MOTOR FUEL IF IT IS REMOVED FROM A TERMINAL, OTHER
THAN BY PIPELINE, BARGE, TANKER OR OTHER VESSEL.
(2) Qualified biodiesel and non-highway [Diesel] DIESEL motor fuel
sold by a person registered under article twelve-A of this chapter as a
distributor of diesel motor fuel to a person registered under such arti-
cle twelve-A as a distributor of diesel motor fuel where such sale is
not a retail sale or a sale that involves a delivery at a filling
station or into a repository equipped with a hose or other apparatus by
which such qualified biodiesel or non-highway [Diesel] DIESEL motor fuel
can be dispensed into the fuel tank of a motor vehicle.
S. 2609--B 96 A. 3009--B
[(2)] (3) Residual petroleum product sold by a person registered under
this article as a residual petroleum product business to a person regis-
tered under this article as a residual petroleum product business where
such sale is not a retail sale. Provided, however, that the commissioner
may require such documentary proof to qualify for any exemption provided
in this section as the commissioner deems appropriate, including the
expansion of any certifications required pursuant to section two hundred
eighty-five-a or two hundred eighty-five-b of this chapter to cover the
taxes imposed by this article.
[(3)] (4) "Qualified biodiesel" means such term as defined in subdivi-
sion twenty-three of section two hundred eighty-two of this chapter.
S 8. Clause (D) of subparagraph (ii) of paragraph 4 of subdivision (b)
of section 1101 of the tax law, as added by chapter 261 of the laws of
1988, is amended to read as follows:
(D) The terms "filling station", "TERMINAL" and "owner" shall have the
same meaning as they have for the purposes of article twelve-A of this
chapter.
S 9. Paragraph 2 of subdivision (a) of section 1102 of the tax law, as
amended by section 5 of part E of chapter 59 of the laws of 2012, is
amended to read as follows:
(2) Every distributor of diesel motor fuel shall pay, as a prepayment
on account of the taxes imposed by this article and pursuant to the
authority of article twenty-nine of this chapter, a tax upon the sale or
use of diesel motor fuel in this state. The tax shall be computed based
upon the number of gallons of diesel motor fuel sold or used. Provided,
however, if the tax has not been imposed prior thereto, it shall be
imposed on THE REMOVAL OF HIGHWAY DIESEL MOTOR FUEL FROM A TERMINAL,
OTHER THAN BY PIPELINE, BARGE, TANKER OR OTHER VESSEL, OR the delivery
of diesel motor fuel to a retail service station. The collection of such
tax shall not be made applicable to the sale or use of diesel motor fuel
under circumstances which preclude the collection of such tax by reason
of the United States constitution and of laws of the United States
enacted pursuant thereto. The prepaid tax on diesel motor fuel shall not
apply to (i) the sale of [previously untaxed] non-highway Diesel motor
fuel to a person registered as a distributor of Diesel motor fuel other
than a sale to such person which involves a delivery at a filling
station or into a repository which is equipped with a hose or other
apparatus by which such fuel can be dispensed into the fuel tank of a
motor vehicle, (ii) the sale to or delivery at a filling station or
other retail vendor of water-white kerosene provided such filling
station or other retail vendor only sells such water-white kerosene
exclusively for heating purposes in containers of no more than twenty
gallons or to the sale of CNG or hydrogen; [or] (iii) the sale of previ-
ously untaxed qualified biodiesel to a person registered under article
twelve-A of this chapter as a distributor of Diesel motor fuel other
than (A) a retail sale to such person or (B) a sale to such person which
involves a delivery at a filling station or into a repository which is
equipped with a hose or other apparatus by which such qualified biodies-
el can be dispensed into the fuel tank of a motor vehicle. "Qualified
biodiesel" means such term as defined in subdivision twenty-three of
section two hundred eighty-two of this chapter, OR (IV) THE SALE OF
PREVIOUSLY UNTAXED HIGHWAY DIESEL MOTOR FUEL BY A PERSON REGISTERED
UNDER ARTICLE TWELVE-A OF THIS CHAPTER AS A DISTRIBUTOR OF DIESEL MOTOR
FUEL TO A PERSON REGISTERED UNDER SUCH ARTICLE TWELVE-A AS A DISTRIBUTOR
OF DIESEL MOTOR FUEL WHERE THE HIGHWAY DIESEL MOTOR FUEL IS EITHER: (A)
BEING DELIVERED BY PIPELINE, RAILCAR, BARGE, TANKER OR OTHER VESSEL TO A
S. 2609--B 97 A. 3009--B
TERMINAL, THE OPERATOR OF WHICH TERMINAL IS REGISTERED UNDER SECTION TWO
HUNDRED EIGHTY-THREE-B OF THIS CHAPTER, OR (B) WITHIN SUCH A TERMINAL
WHERE IT HAS BEEN SO DELIVERED. PROVIDED, HOWEVER, THAT THE EXEMPTION
SET FORTH IN THIS SUBPARAGRAPH SHALL NOT APPLY TO ANY HIGHWAY DIESEL
MOTOR FUEL IF IT IS REMOVED FROM A TERMINAL, OTHER THAN BY PIPELINE,
BARGE, TANKER OR OTHER VESSEL.
S 10. Paragraph 2 of subdivision (a) of section 1102 of the tax law,
as amended by section 6 of part E of chapter 59 of the laws of 2012, is
amended to read as follows:
(2) Every distributor of diesel motor fuel shall pay, as a prepayment
on account of the taxes imposed by this article and pursuant to the
authority of article twenty-nine of this chapter, a tax upon the sale or
use of diesel motor fuel in this state. The tax shall be computed based
upon the number of gallons of diesel motor fuel sold or used. Provided,
however, if the tax has not been imposed prior thereto, it shall be
imposed on THE REMOVAL OF HIGHWAY DIESEL MOTOR FUEL FROM A TERMINAL,
OTHER THAN BY PIPELINE, BARGE, TANKER OR OTHER VESSEL, OR the delivery
of diesel motor fuel to a retail service station. The collection of such
tax shall not be made applicable to the sale or use of diesel motor fuel
under circumstances which preclude the collection of such tax by reason
of the United States constitution and of laws of the United States
enacted pursuant thereto. The prepaid tax on diesel motor fuel shall not
apply to (i) the sale of non-highway Diesel motor fuel to a person
registered as a distributor of Diesel motor fuel other than a sale to
such person which involves a delivery at a filling station or into a
repository which is equipped with a hose or other apparatus by which
such fuel can be dispensed into the fuel tank of a motor vehicle, (ii)
the sale to or delivery at a filling station or other retail vendor of
water-white kerosene provided such filling station or other retail
vendor only sells such water-white kerosene exclusively for heating
purposes in containers of no more than twenty gallons; or (iii) the sale
of previously untaxed qualified biodiesel to a person registered under
article twelve-A of this chapter as a distributor of Diesel motor fuel
other than (A) a retail sale to such person or (B) a sale to such person
which involves a delivery at a filling station or into a repository
which is equipped with a hose or other apparatus by which such qualified
biodiesel can be dispensed into the fuel tank of a motor vehicle. "Qual-
ified biodiesel" means such term as defined in subdivision twenty-three
of section two hundred eighty-two of this chapter, OR (IV) THE SALE OF
PREVIOUSLY UNTAXED HIGHWAY DIESEL MOTOR FUEL BY A PERSON REGISTERED
UNDER ARTICLE TWELVE-A OF THIS CHAPTER AS A DISTRIBUTOR OF DIESEL MOTOR
FUEL TO A PERSON REGISTERED UNDER SUCH ARTICLE TWELVE-A AS A DISTRIBUTOR
OF DIESEL MOTOR FUEL WHERE THE HIGHWAY DIESEL MOTOR FUEL IS EITHER: (A)
BEING DELIVERED BY PIPELINE, RAILCAR, BARGE, TANKER OR OTHER VESSEL TO A
TERMINAL, THE OPERATOR OF WHICH TERMINAL IS REGISTERED UNDER SECTION TWO
HUNDRED EIGHTY-THREE-B OF THIS CHAPTER, OR (B) WITHIN SUCH A TERMINAL
WHERE IT HAS BEEN SO DELIVERED. PROVIDED, HOWEVER, THAT THE EXEMPTION
SET FORTH IN THIS SUBPARAGRAPH SHALL NOT APPLY TO ANY HIGHWAY DIESEL
MOTOR FUEL ONCE IT IS REMOVED FROM A TERMINAL, OTHER THAN BY PIPELINE,
BARGE, TANKER OR OTHER VESSEL.
S 11. Section 1812-c of the tax law, as added by chapter 276 of the
laws of 1986, is amended to read as follows:
S 1812-c. Person not licensed as terminal operator. Any person who,
while not licensed as such pursuant to the provisions of article
twelve-A of this chapter, operates as a terminal operator as defined in
subdivision thirteen of section two hundred eighty-two of this chapter,
S. 2609--B 98 A. 3009--B
except where all of the motor fuel OR DIESEL MOTOR FUEL stored in the
storage facility is solely for such person's own use and consumption,
shall be guilty of a class E felony.
S 12. This act shall take effect August 1, 2013; provided, however,
that the amendments made to paragraph 2 of subdivision (a) of section
1102 of the tax law made by section nine of this act shall be subject to
the expiration and reversion of such paragraph pursuant to section 19 of
part W-1 of chapter 109 of the laws of 2006, as amended, when upon such
date the provisions of section ten of this act shall take effect.
PART X
Section 1. Subdivision 3 of section 504 of the tax law, as amended by
chapter 194 of the laws of 1963, is amended to read as follows:
3. [Owned and operated] (A) OPERATED by a farmer OR BY A PERSON THAT
BEARS THE RELATIONSHIP TO SUCH FARMER DESCRIBED IN PARAGRAPH (B) OF THIS
SUBDIVISION and used exclusively by such farmer OR SUCH PERSON in trans-
porting [his] SUCH FARMER'S own agricultural commodities and products,
pulpwood or livestock, including the packed, processed, or manufactured
products thereof, that were originally grown or raised on [his] SUCH
FARMER'S farm, lands or orchard, or when used to transport supplies and
equipment to [his] SUCH FARMER'S farm or orchard that are consumed and
used thereon or when operated by [a] SUCH farmer OR SUCH PERSON in
transporting farm products from a farm contiguous to [his own] SUCH
FARMER'S FARM.
(B) THE RELATIONSHIP TO SUCH FARMER AS REFERENCED IN PARAGRAPH (A) OF
THIS SUBDIVISION, SHALL INCLUDE:
(I) MEMBERS OF A FAMILY, INCLUDING SPOUSES, ANCESTORS, LINEAL DESCEND-
ANTS, BROTHERS AND SISTERS (WHETHER BY THE WHOLE OR HALF BLOOD), AND
ENTITIES RELATED TO SUCH A FAMILY MEMBER AS DESCRIBED IN SUBPARAGRAPHS
(II) THROUGH (IV) OF THIS PARAGRAPH;
(II) A SHAREHOLDER AND A CORPORATION MORE THAN FIFTY PERCENT OF THE
VALUE OF THE OUTSTANDING STOCK OF WHICH IS OWNED OR CONTROLLED DIRECTLY
OR INDIRECTLY BY SUCH SHAREHOLDER;
(III) A PARTNER AND A PARTNERSHIP MORE THAN FIFTY PERCENT OF THE CAPI-
TAL OR PROFITS INTEREST IN WHICH IS OWNED OR CONTROLLED DIRECTLY OR
INDIRECTLY BY SUCH PARTNER;
(IV) A BENEFICIARY AND A TRUST MORE THAN FIFTY PERCENT OF THE BENEFI-
CIAL INTEREST IN WHICH IS OWNED OR CONTROLLED DIRECTLY OR INDIRECTLY BY
SUCH BENEFICIARY;
(V) TWO OR MORE CORPORATIONS, PARTNERSHIPS, ASSOCIATIONS, OR TRUSTS,
OR ANY COMBINATION THEREOF, WHICH ARE OWNED OR CONTROLLED, EITHER
DIRECTLY OR INDIRECTLY, BY THE SAME PERSON, CORPORATION OR OTHER ENTITY,
OR INTERESTS; AND
(VI) A GRANTOR OF A TRUST AND SUCH TRUST.
S 2. This act shall take effect on the first day of the first month
next occurring 60 days after this act shall have become a law.
S 2. Severability clause. If any clause, sentence, paragraph, subdivi-
sion, section or part of this act shall be adjudged by any court of
competent jurisdiction to be invalid, such judgment shall not affect,
impair, or invalidate the remainder thereof, but shall be confined in
its operation to the clause, sentence, paragraph, subdivision, section
or part thereof directly involved in the controversy in which such judg-
ment shall have been rendered. It is hereby declared to be the intent of
the legislature that this act would have been enacted even if such
invalid provisions had not been included herein.
S. 2609--B 99 A. 3009--B
S 3. This act shall take effect immediately provided, however, that
the applicable effective date of Parts A through X of this act shall be
as specifically set forth in the last section of such Parts.