S T A T E O F N E W Y O R K
________________________________________________________________________
6989
2013-2014 Regular Sessions
I N A S S E M B L Y
April 29, 2013
___________
Introduced by M. of A. GABRYSZAK -- read once and referred to the
Committee on Ways and Means
AN ACT to amend the tax law, in relation to the biofuel production cred-
it for the production of cellulosic ethanol, densified biofuel and
renewable fuel oil
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. Section 28 of the tax law, as added by section 1 of part X
of chapter 62 of the laws of 2006, subdivision (a) as amended by section
1 of part K of chapter 59 of the laws of 2012, is renumbered section 38
and amended to read as follows:
S 38. Biofuel production credit. (a) General. A taxpayer subject to
tax under article nine, nine-A or twenty-two of this chapter shall be
allowed a credit against such tax pursuant to the provisions referenced
in subdivision (d) of this section. The credit (or pro rata share of
earned credit in the case of a partnership) for each gallon of LIQUID
biofuel produced at a biofuel plant on or after January first, two thou-
sand six shall equal fifteen cents per gallon, OR TWENTY-FIVE CENTS PER
GALLON FOR PRODUCTION OF CELLULOSIC ETHANOL OR RENEWABLE FUEL OIL after
the production of the first forty thousand gallons per year presented to
market. THE CREDIT FOR EACH BONE DRY TON OF DENSIFIED BIOFUEL PRODUCED
AT A BIOFUEL PLANT ON OR AFTER JANUARY FIRST, TWO THOUSAND SIX SHALL
EQUAL FIFTEEN DOLLARS PER BONE DRY TON AFTER THE PRODUCTION OF THE FIRST
TEN THOUSAND TONS PER YEAR PRESENTED TO MARKET. The credit under this
section shall be capped at [two and one-half] TEN million dollars per
taxpayer per taxable year for up to no more than [four] TEN consecutive
taxable years per biofuel plant. If the taxpayer is a partner in a part-
nership or shareholder of a New York S corporation, then the cap imposed
by the preceding sentence shall be applied at the entity level, so that
the aggregate credit allowed to all the partners or shareholders of each
such entity in the taxable year does not exceed [two and one-half] TEN
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD10038-01-3
A. 6989 2
million dollars. The tax credit allowed pursuant to this section shall
apply to taxable years beginning before January first, two thousand
twenty.
(b) Definitions. For the purpose of this section, the following terms
shall have the following meanings:
(1) "Biofuel" means a fuel which includes biodiesel [and], ethanol,
DENSIFIED BIOFUEL AND RENEWABLE FUEL OIL. The term "biodiesel" shall
mean a fuel comprised exclusively of mono-alkyl esters of long chain
fatty acids derived from vegetable oils or animal fats, designated B100,
which meets the specifications of American Society of Testing and Mate-
rials designation D 6751-02. The term "ethanol" shall mean ethyl alcohol
manufactured in the United States and its territories and sold (i) for
fuel use and which has been rendered unfit for beverage use in a manner
and which is produced at a facility approved by the federal bureau of
alcohol, tobacco and firearms for the production of ethanol for fuel, or
(ii) as denatured ethanol used by blenders and refiners which has been
rendered unfit for beverage use. The term "biofuel" may also include
any other standard approved by the New York state energy and research
development authority. THE TERM "RENEWABLE FUEL OIL" SHALL MEAN A FUEL
COMPRISED OF ANY NON-FOOD BIOMASS BASED FEEDSTOCK THAT CAN BE USED AS A
FULL OR PARTIAL SUBSTITUTE FOR TRADITIONAL PETROLEUM FUELS.
(2) "CELLULOSIC ETHANOL" MEANS THE PRODUCTION OF ETHANOL FROM LIGNO-
CELLULOSIC BIOMASS FEEDSTOCKS NOT USED FOR FOOD PRODUCTION, INCLUDING
BY-PRODUCTS FROM AGRICULTURAL WASTE, THAT ARE ALTERED THROUGH ACTIVITIES
REFERENCED IN SUBPARAGRAPH FIVE OF PARAGRAPH (B) OF SUBDIVISION ONE OF
SECTION THIRTY-ONE HUNDRED TWO-E OF THE PUBLIC AUTHORITIES LAW. SUCH
LIGNOCELLULOSIC BIOMASS FEEDSTOCKS MAY INCLUDE, BUT ARE NOT NECESSARILY
LIMITED TO, SWITCHGRASSES OR WILLOWS, AGRICULTURAL AND FORESTRY RESI-
DUES, CLEAN WOOD AND WOOD WASTES, PULP AND PAPER MILL WASTES OR
EXTRACTS, AND NON-RECYCLABLE PAPER. ANY QUESTION AS TO WHETHER ANY
FEEDSTOCK QUALIFIES UNDER THIS SECTION SHALL BE DETERMINED BY THE PRESI-
DENT OF THE NEW YORK STATE ENERGY AND RESEARCH DEVELOPMENT AUTHORITY.
(3) "DENSIFIED BIOFUEL" MEANS A SOLID FUEL DERIVED BY THE MECHANICAL
DENSIFICATION AND REFINING OF BIOMASS SOURCED FROM WOODY OR AGRICULTURAL
FEEDSTOCKS.
(4) "Biofuel plant" means a commercial facility located in New York
state at which one or more biofuels are produced. FOR THE PURPOSES OF
THIS SECTION, ANY COMMERCIAL FACILITY WHERE CELLULOSIC ETHANOL, RENEWA-
BLE FUEL OIL OR DENSIFIED BIOFUEL IS PRODUCED SHALL BE CONSIDERED A
SEPARATE BIOFUEL PLANT.
(c) Reporting requirements. A taxpayer wishing to claim a credit under
this section shall annually certify to the commissioner (i) that biofuel
produced at the eligible biofuel plant meets all existing standards for
biofuel and (ii) the amount of biofuel produced at the eligible biofuel
plant during a taxable year.
(d) Cross-references. For application of the credit provided for in
this section, see the following provisions of this chapter:
(1) Article 9: Section 187-c.
(2) Article 9-A: Section 210, subdivision 38.
(3) Article 22: Section 606, subsections (i) and (jj).
S 2. Section 187-c of the tax law, as amended by section 2 of part K
of chapter 59 of the laws of 2012, is amended to read as follows:
S 187-c. Biofuel production credit. A taxpayer shall be allowed a
credit to be computed as provided in section [twenty-eight] THIRTY-EIGHT
of this chapter, [as added by part X of chapter sixty-two of the laws of
two thousand six,] against the tax imposed by this article. Provided,
A. 6989 3
however, that the amount of such credit allowed against the tax imposed
by section one hundred eighty-four of this article shall be the excess
of the amount of such credit over the amount of any credit allowed by
this section against the tax imposed by section one hundred eighty-three
of this article. 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 the
credit allowed under this section for any taxable year reduces the tax
to such amount, the excess shall be treated as an overpayment of tax to
be credited or refunded in accordance with the provisions of section six
hundred 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. The tax credit
allowed pursuant to this section shall apply to taxable years beginning
before January first, two thousand twenty.
S 3. Subdivision 38 of section 210 of the tax law, as amended by
section 3 of part K of chapter 59 of the laws of 2012, is amended to
read as follows:
38. Biofuel production credit. A taxpayer shall be allowed a credit,
to be computed as provided in section [twenty-eight] THIRTY-EIGHT of
this chapter, [as added by part X of chapter sixty-two of the laws of
two thousand six,] against the tax imposed by this article. 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 credit 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. The tax
credit allowed pursuant to this section shall apply to taxable years
beginning before January first, two thousand twenty.
S 4. Subsection (jj) of section 606 of the tax law, as amended by
section 4 of part K of chapter 59 of the laws of 2012, is amended to
read as follows:
(jj) Biofuel production credit. A taxpayer shall be allowed a credit
to be computed as provided in section [twenty-eight] THIRTY-EIGHT of
this chapter, [as added by part X of chapter sixty-two of the laws of
two thousand six,] against the tax imposed by this article. If the
amount of the credit allowed under this subsection for any taxable year
shall exceed the taxpayer's tax for such year, the excess shall be
treated as an overpayment of tax to be credited or refunded in accord-
ance with the provisions of section six hundred eighty-six of this arti-
cle, provided, however, that no interest shall be paid thereon. The tax
credit allowed pursuant to this section shall apply to taxable years
beginning before January first, two thousand twenty.
S 5. This act shall take effect immediately.