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

                                  8702

                          I N  A S S E M B L Y

                            February 4, 2014
                               ___________

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

AN  ACT  to amend the tax law, in relation to the creation of the empire
  state music production credit

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

  Section  1.  The tax law is amended by adding a new section 41 to read
as follows:
  S 41.  EMPIRE STATE MUSIC PRODUCTION CREDIT. (A)(1) ALLOWANCE OF CRED-
IT. A TAXPAYER WHICH IS A QUALIFIED MUSIC PRODUCTION COMPANY, OR A QUAL-
IFIED INDEPENDENT MUSIC PRODUCTION COMPANY, OR WHICH IS A SOLE  PROPRIE-
TOR  OF  OR  A  MEMBER  OF  A  PARTNERSHIP  WHICH  IS  A QUALIFIED MUSIC
PRODUCTION COMPANY OR A QUALIFIED INDEPENDENT MUSIC PRODUCTION  COMPANY,
AND  WHICH  IS SUBJECT TO TAX UNDER ARTICLE NINE-A OR TWENTY-TWO OF THIS
CHAPTER, SHALL BE ALLOWED A CREDIT AGAINST SUCH TAX.
  (2) THE AMOUNT OF THE CREDIT SHALL BE THE PRODUCT (OR PRO  RATA  SHARE
OF  THE  PRODUCT,  IN  THE  CASE OF A MEMBER OF A PARTNERSHIP) OF TWENTY
PERCENT AND THE QUALIFIED PRODUCTION  COSTS  PAID  OR  INCURRED  IN  THE
PRODUCTION OF MUSIC BY THE TAXPAYER. SUCH COSTS SHALL INCLUDE: RECORDING
PRODUCTION  COSTS,  ARTISTS' ROYALTIES, MUSICIAN SESSION FEES, GRAPHICS,
DIGITAL SCANNING, PROGRAMMING AND TESTING, PRODUCTION  COSTS  FOR  MUSIC
VIDEOS  MADE IN NEW YORK STATE AND DIRECT MARKETING EXPENDITURES INCLUD-
ING CONSULTANT FEES AND COSTS TO LAUNCH THE RECORDING. COSTS  SHALL  NOT
INCLUDE TOURING, PERFORMING, MANUFACTURING AND DISTRIBUTION COSTS.
  (3)  NO QUALIFIED PRODUCTION COSTS USED BY A TAXPAYER AS THE BASIS FOR
THE ALLOWANCE OF THE CREDIT PROVIDED FOR UNDER  THIS  SECTION  SHALL  BE
USED BY SUCH TAXPAYER TO CLAIM ANY OTHER CREDIT ALLOWED PURSUANT TO THIS
CHAPTER.
  (B)  ALLOCATION OF CREDIT. THE AGGREGATE AMOUNT OF TAX CREDITS ALLOWED
UNDER THIS SECTION, SUBDIVISION FORTY-EIGHT OF SECTION TWO  HUNDRED  TEN
AND  SUBSECTION  (XX)  OF SECTION SIX HUNDRED SIX OF THIS CHAPTER IN ANY
CALENDAR YEAR SHALL BE SIXTY MILLION DOLLARS. SUCH AGGREGATE  AMOUNT  OF
CREDITS  SHALL  BE ALLOCATED BY THE EMPIRE STATE DEVELOPMENT CORPORATION
AMONG TAXPAYERS IN ORDER OF PRIORITY BASED UPON THE DATE  OF  FILING  AN

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

                                                           LBD13775-01-4

A. 8702                             2

APPLICATION  FOR ALLOCATION OF MUSIC PRODUCTION CREDIT WITH SUCH OFFICE.
IF THE TOTAL AMOUNT OF ALLOCATED CREDITS APPLIED FOR IN  ANY  PARTICULAR
YEAR  EXCEEDS  THE AGGREGATE AMOUNT OF TAX CREDITS ALLOWED FOR SUCH YEAR
UNDER  THIS SECTION, SUCH EXCESS SHALL BE TREATED AS HAVING BEEN APPLIED
FOR ON THE FIRST DAY OF THE SUBSEQUENT YEAR.
  (C) CROSS-REFERENCES. FOR APPLICATION OF THE CREDIT  PROVIDED  FOR  IN
THIS SECTION, SEE THE FOLLOWING PROVISIONS OF THIS CHAPTER:
  (1) ARTICLE 9-A: SECTION 210: SUBDIVISION 48
  (2) ARTICLE 22: SECTION 606: SUBSECTION (XX)
  S 2. Section 210 of the tax law is amended by adding a new subdivision
48 to read as follows:
  48.  EMPIRE  STATE MUSIC PRODUCTION CREDIT. (A) ALLOWANCE OF CREDIT. A
TAXPAYER WHO IS ELIGIBLE PURSUANT TO SECTION FORTY-ONE OF  THIS  CHAPTER
SHALL  BE  ALLOWED  A  CREDIT TO BE COMPUTED AS PROVIDED IN SUCH SECTION
FORTY-ONE AGAINST THE TAX IMPOSED BY THIS ARTICLE.
  (B) APPLICATION OF CREDIT. THE CREDIT ALLOWED UNDER  THIS  SUBDIVISION
FOR  ANY TAXABLE YEAR SHALL NOT REDUCE THE TAX DUE FOR SUCH YEAR TO LESS
THAN THE AMOUNT PRESCRIBED IN PARAGRAPH (D) OF SUBDIVISION ONE  OF  THIS
SECTION.  PROVIDED,  HOWEVER, THAT IF THE AMOUNT OF THE CREDIT ALLOWABLE
UNDER THIS SUBDIVISION FOR ANY TAXABLE YEAR  REDUCES  THE  TAX  TO  SUCH
AMOUNT, THE EXCESS SHALL BE TREATED AS AN OVERPAYMENT OF TAX TO BE CRED-
ITED  OR REFUNDED IN ACCORDANCE WITH THE PROVISIONS OF SECTION ONE THOU-
SAND 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.
  S 3. Subparagraph (B) of paragraph 1 of subsection (i) of section  606
of  the  tax  law  is amended by adding a new clause (xxxvii) to read as
follows:
(XXXVII) EMPIRE STATE MUSIC          AMOUNT OF CREDIT FOR
PRODUCTION CREDIT UNDER              QUALIFIED PRODUCTION CREDIT
SUBSECTION (XX)                      MUSIC UNDER SUBDIVISION
                                     FORTY-ONE OF SECTION TWO
                                     HUNDRED TEN
  S 4. Subsections (yy) and (zz) of section  606  of  the  tax  law,  as
relettered  by section 5 of part H of chapter 1 of the laws of 2003, are
relettered subsections (yyy) and (zzz) and  a  new  subsection  (xx)  is
added to read as follows:
  (XX)  EMPIRE STATE MUSIC PRODUCTION CREDIT. (1) ALLOWANCE OF CREDIT. A
TAXPAYER WHO IS ELIGIBLE PURSUANT TO SECTION FORTY-ONE OF  THIS  CHAPTER
SHALL  BE  ALLOWED  A  CREDIT TO BE COMPUTED AS PROVIDED IN SUCH SECTION
FORTY-ONE AGAINST THE TAX IMPOSED BY THIS ARTICLE.
  (2) APPLICATION OF CREDIT. IF THE AMOUNT OF THE CREDIT ALLOWABLE UNDER
THIS SUBSECTION FOR ANY TAXABLE YEAR EXCEEDS THE TAXPAYER'S TAX FOR SUCH
YEAR, THE EXCESS SHALL BE TREATED AS AN OVERPAYMENT OF TAX TO BE CREDIT-
ED OR REFUNDED AS PROVIDED IN SECTION SIX  HUNDRED  EIGHTY-SIX  OF  THIS
ARTICLE, PROVIDED, HOWEVER, THAT NO INTEREST SHALL BE PAID THEREON.
  S  5.  The  empire  state development corporation shall report, to the
governor and the legislature, its findings, conclusions and  recommenda-
tions  on  or before one year from the date this act shall become a law,
and shall submit with its report such legislative proposals as it  deems
necessary to implement its recommendations.
  S 6. This act shall take effect on the one hundred eightieth day after
it shall have become a law.