senate Bill S2522A

2013-2014 Legislative Session

Establishes a solar incentive program and related tax credits

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Archive: Last Bill Status - In Committee


  • Introduced
  • In Committee
  • On Floor Calendar
    • Passed Senate
    • Passed Assembly
  • Delivered to Governor
  • Signed/Vetoed by Governor

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Actions

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Assembly Actions - Lowercase
Senate Actions - UPPERCASE
Feb 27, 2014 print number 2522a
amend and recommit to energy and telecommunications
Jan 08, 2014 referred to energy and telecommunications
returned to senate
died in assembly
Apr 24, 2013 referred to energy
Apr 23, 2013 delivered to assembly
passed senate
Apr 22, 2013 advanced to third reading
Apr 17, 2013 2nd report cal.
Apr 16, 2013 1st report cal.307
Feb 04, 2013 reported and committed to finance
Jan 18, 2013 referred to energy and telecommunications

Bill Amendments

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A (Active)
Original
A (Active)

Co-Sponsors

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S2522 - Bill Details

Current Committee:
Law Section:
Public Service Law
Laws Affected:
Add §66-n, Pub Serv L; ren §§1020-ii - 1020-kk to be §§1020-jj - 1020-ll, add §1020-ii, Pub Auth L; amd §§210 & 606, Tax L

S2522 - Bill Texts

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Establishes a solar incentive program and a qualified solar and energy storage manufacturer facilities and operations credit.

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BILL NUMBER:S2522

TITLE OF BILL: An act to amend the public service law, the public
authorities law and the tax law, in relation to establishing a solar
incentive program and related tax credits

PURPOSE: To establish a solar incentive program that includes an
extension of certain existing programs and the creation of new tax
credits for solar and energy storage manufacturing facilities.

SUMMARY OF PROVISIONS:

Sections 1 and 2 of the bill amend the public service law and the
public authorities law to codify the recently instituted NY Sun
Program and to extend such program through calendar year 2023.

Sections 3, 4 & 5 of the bill amend various sections of the tax law to
establish the qualified solar and energy storage manufacturer
facilities and operations credit.

Section 6 of the bill is a severability clause.

Section 7 is the effective date.

JUSTIFICATION: New York State must take measures to ensure that it
remains at the forefront of economical power generation and the
delivery of alternative and cleaner power. This legislation provides
appropriate incentives for solar power generation by including a long
term strategy for solar expansion with an equally important goal of
minimizing negative rate payer impacts.

This legislation also seeks to capitalize on the growing solar and
energy storage segments of the energy sector through an appropriate
tax credit for manufacturer facilities. At the present time, New York
State is experiencing a lag in the development of these segments of
the renewable energy sector when compared to other states. Part of the
problem has been that there is no clear incentive for businesses to
make capital investments in solar and energy storage development.
This is both a necessary and prudent step because it will help New
York meet its goals for renewable energy. And, just as importantly, it
will help to create solar and energy storage manufacturing and
marketing jobs in New York State, rather than see them created in
another state or even worse, another country.

PRIOR LEGISLATIVE HISTORY: New bill.

FISCAL IMPLICATIONS: To be determined.

EFFECTIVE DATE: This act shall take effect immediately and shall
apply to taxable years commencing on or after January 1, 2014.

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

                                  2522

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                            January 18, 2013
                               ___________

Introduced  by  Sens.  MAZIARZ, GRISANTI, LARKIN, MARCELLINO, RITCHIE --
  read twice and ordered printed, and when printed to  be  committed  to
  the Committee on Energy and Telecommunications

AN  ACT  to amend the public service law, the public authorities law and
  the tax law, in relation to establishing a solar incentive program and
  related tax credits

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

  Section  1.  The public service law is amended by adding a new section
66-n to read as follows:
  S 66-N. SOLAR INCENTIVE PROGRAM. 1. AS USED IN THIS SECTION:
  (A) "ELECTRIC DISTRIBUTION COMPANY" MEANS AN  INVESTOR-OWNED  ELECTRIC
CORPORATION  THAT DISTRIBUTES AND DELIVERS ELECTRICITY WITHIN THIS STATE
AND HAS ANNUAL REVENUES IN EXCESS OF TWO HUNDRED MILLION DOLLARS; AND
  (B) "QUALIFIED SOLAR PHOTOVOLTAIC GENERATING SYSTEM" MEANS A SYSTEM OF
COMPONENTS OWNED OR DEVELOPED BY AN ENTITY OTHER THAN A PUBLIC AUTHORITY
OR AN ELECTRIC DISTRIBUTION COMPANY AND THAT GENERATES ELECTRICITY  FROM
SUNLIGHT  BY MEANS OF THE PHOTOVOLTAIC EFFECT, WHETHER OR NOT THE DEVICE
IS COUPLED WITH A DEVICE CAPABLE OF  STORING  THE  ENERGY  PRODUCED  FOR
LATER  USE  THAT  IS (I) INSTALLED AND OPERATED IN NEW YORK STATE WITHIN
ONE OF THE SERVICE TERRITORIES OF AN ELECTRIC  DISTRIBUTION  COMPANY  AS
DEFINED  IN  THIS  SECTION,  AND (II) INSTALLED AFTER JANUARY FIRST, TWO
THOUSAND FOURTEEN.
  2. WITHIN FORTY-FIVE DAYS OF THE EFFECTIVE DATE OF THIS  SECTION,  THE
COMMISSION  SHALL  COMMENCE  THE  CONSIDERATION  OF MODIFICATIONS TO ITS
EXISTING PROGRAMS THAT ENCOURAGE  THE  DEVELOPMENT  OF  QUALIFIED  SOLAR
PHOTOVOLTAIC  GENERATING  SYSTEMS  AND, NO LATER THAN JANUARY FIRST, TWO
THOUSAND FOURTEEN, THE COMMISSION SHALL MAKE A DETERMINATION  ESTABLISH-
ING  MODIFICATIONS  TO ITS EXISTING PROGRAMS THAT ENCOURAGE THE DEVELOP-
MENT OF QUALIFIED SOLAR PHOTOVOLTAIC GENERATING SYSTEMS  IN  CONFORMANCE
WITH  THIS SECTION. THE DEPARTMENT SHALL CONSULT WITH THE NEW YORK STATE

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD04599-01-3

S. 2522                             2

ENERGY RESEARCH AND DEVELOPMENT AUTHORITY  IN  THE  PREPARATION  OF  ITS
RECOMMENDATIONS  TO  THE  COMMISSION FOR SUCH DETERMINATION. THE PROGRAM
MODIFICATIONS SHALL REQUIRE:
  (A)  ADMINISTRATION BY THE NEW YORK STATE ENERGY RESEARCH AND DEVELOP-
MENT AUTHORITY;
  (B) PLANNED ANNUAL EXPENDITURES INCLUDING ALL COSTS OF  A  MINIMUM  OF
ONE  HUNDRED EIGHT MILLION DOLLARS COMMENCING IN CALENDAR YEAR TWO THOU-
SAND FOURTEEN AND SUSTAINED EACH YEAR THROUGH CALENDAR YEAR TWO THOUSAND
TWENTY-THREE;
  (C) A DIVERSITY OF PROJECT SIZES, GEOGRAPHIC DISTRIBUTION, AND PARTIC-
IPATION AMONG CUSTOMER CLASSES, SUBJECT TO COST-EFFECTIVENESS  CONSIDER-
ATIONS;
  (D)  INCENTIVE STRUCTURES THAT MAXIMIZE COST-EFFECTIVENESS AND PRACTI-
CALITY THROUGH  COMPETITIVE  PROCUREMENTS,  STANDING-OFFERS,  PRODUCTION
INCENTIVES OR CAPACITY INCENTIVES AT THE WHOLESALE OR RETAIL LEVEL AS IN
THE  JUDGMENT OF THE COMMISSION, IN CONSULTATION WITH THE NEW YORK INDE-
PENDENT SYSTEM OPERATOR, PROVIDE FOR THE MOST EFFECTIVE PROGRAM;
  (E) INCENTIVE STRUCTURES THAT TAKE  INTO  CONSIDERATION  THE  ECONOMIC
BENEFITS TO THE STATE OF NEW YORK;
  (F)  PROGRAM  DESIGNS  THAT  TAKE  INTO CONSIDERATION THE AVOIDANCE OF
LONG-TERM COSTS TO THE TRANSMISSION AND DISTRIBUTION SYSTEM AND  MINIMI-
ZATION OF PEAK LOAD IN CONSTRAINED AREAS;
  (G)  ANNUAL  REPORTS  ON  THE  ACHIEVEMENTS  AND  EFFECTIVENESS OF THE
PROGRAM; AND
  (H) SUCH OTHER ISSUES DEEMED APPROPRIATE BY THE COMMISSION.
  S 2. Sections 1020-ii, 1020-jj and 1020-kk of the  public  authorities
law,  as  renumbered  by chapter 388 of the laws of 2011, are renumbered
sections 1020-jj, 1020-kk and 1020-ll and a new section 1020-ii is added
to read as follows:
  S 1020-II. ESTABLISHMENT OF SOLAR INCENTIVE PROGRAM.  1.  AS  USED  IN
THIS  SECTION  THE TERM "QUALIFIED SOLAR PHOTOVOLTAIC GENERATING SYSTEM"
MEANS A SYSTEM OF COMPONENTS OWNED OR DEVELOPED BY AN ENTITY OTHER  THAN
A  PUBLIC  AUTHORITY OR AN ELECTRIC DISTRIBUTION COMPANY AND THAT GENER-
ATES ELECTRICITY FROM SUNLIGHT BY  MEANS  OF  THE  PHOTOVOLTAIC  EFFECT,
WHETHER  OR  NOT  THE DEVICE IS COUPLED WITH A DEVICE CAPABLE OF STORING
THE ENERGY PRODUCED FOR LATER USE, THAT IS INSTALLED IN THE  AUTHORITY'S
SERVICE TERRITORY AFTER JANUARY FIRST, TWO THOUSAND TWELVE.
  2. THE AUTHORITY SHALL CONTINUE TO ENCOURAGE THE DEVELOPMENT OF QUALI-
FIED  SOLAR  PHOTOVOLTAIC  GENERATING  SYSTEMS  IN ITS SERVICE TERRITORY
THROUGH IMPLEMENTATION OF THE SOLAR INCENTIVE PROGRAM. THE PROGRAM SHALL
REQUIRE:
  (A) PLANNED ANNUAL EXPENDITURES INCLUDING  ALL  COSTS  OF  AT  MINIMUM
THIRTY-EIGHT  MILLION  DOLLARS  COMMENCING IN CALENDAR YEAR TWO THOUSAND
FOURTEEN AND SUSTAINED EACH YEAR  THROUGH  CALENDAR  YEAR  TWO  THOUSAND
TWENTY-THREE;
  (B) A DIVERSITY OF PROJECT TYPES;
  (C) PROGRAM ADMINISTRATION AND DELIVERY;
  (D)  INCENTIVE  STRUCTURES  THAT  TAKE INTO CONSIDERATION THE ECONOMIC
BENEFITS TO THE STATE OF NEW YORK;
  (E) PROGRAM DESIGNS THAT TAKE  INTO  CONSIDERATION  THE  AVOIDANCE  OF
LONG-TERM  COSTS TO THE TRANSMISSION AND DISTRIBUTION SYSTEM AND MINIMI-
ZATION OF PEAK LOAD IN CONSTRAINED AREAS AND THAT MAXIMIZES  COST-EFFEC-
TIVENESS THROUGH COMPETITIVE PROCUREMENTS;
  (F)  ANNUAL  REPORTS  ON  THE  ACHIEVEMENTS  AND  EFFECTIVENESS OF THE
PROGRAM; AND
  (G) ANY OTHER OBJECTIVES THE AUTHORITY MAY ESTABLISH.

S. 2522                             3

  S 3. Section 210 of the tax law is amended by adding a new subdivision
12-H to read as follows:
  12-H.   QUALIFIED SOLAR AND ENERGY STORAGE MANUFACTURER FACILITIES AND
OPERATIONS CREDIT. (A) A TAXPAYER THAT IS WHOLE OR  PART  OF  AN  ENTITY
THAT  SERVES AS THE PRINCIPAL OPERATOR OF A FACILITY PRIMARILY FUNCTION-
ING TO FABRICATE SOLAR ENERGY EQUIPMENT OR ENERGY STORAGE EQUIPMENT  AND
THAT  MEETS THE ELIGIBILITY REQUIREMENTS IN PARAGRAPH (B) OF THIS SUBDI-
VISION, SHALL BE ALLOWED A CREDIT AGAINST THE TAX IMPOSED BY THIS  ARTI-
CLE. THE AMOUNT OF CREDIT SHALL BE EQUAL TO THE SUM OF THE AMOUNTS SPEC-
IFIED  IN PARAGRAPHS (C) AND (D) OF THIS SUBDIVISION ATTRIBUTABLE TO THE
TAXPAYER SUBJECT TO THE LIMITATIONS IN PARAGRAPH (E)  OF  THIS  SUBDIVI-
SION.  FOR THE PURPOSES OF THIS SUBDIVISION SOLAR ENERGY EQUIPMENT SHALL
MEAN THE MANUFACTURING OF MATERIAL COMPONENTS IN NEW YORK STATE DESIGNED
TO PRODUCE ELECTRICITY UTILIZING SOLAR RADIATION AS  THE  ENERGY  SOURCE
FOR  SUCH ELECTRICITY; AND ENERGY STORAGE EQUIPMENT SHALL MEAN MATERIALS
AND DEVICES INTENDED TO STORE SOME FORM OF ENERGY RELATED TO NEW  ENERGY
TECHNOLOGIES AS DESCRIBED IN SUBDIVISION ONE OF SECTION EIGHTEEN HUNDRED
FIFTY-FOUR  OF  THE  PUBLIC  AUTHORITIES  LAW. SUCH EQUIPMENT MAY EMPLOY
ELECTRICAL, ELECTROCHEMICAL, SUPERCAPACITOR, COMPRESSED GAS, MECHANICAL,
THERMAL OR OTHER DEMONSTRABLE MEANS  SINGLY  OR  IN  COMBINATION.    THE
DETERMINATION OF WHETHER SOLAR ENERGY EQUIPMENT OR ENERGY STORAGE EQUIP-
MENT QUALIFIES FOR ELIGIBLE COSTS UNDER THIS SUBDIVISION SHALL BE DETER-
MINED  BY  THE  COMMISSIONER  AND, IF REQUESTED BY THE COMMISSIONER, THE
PRESIDENT OF THE NEW YORK STATE ENERGY RESEARCH AND DEVELOPMENT AUTHORI-
TY.
  (B) AN  ELIGIBLE  TAXPAYER  SHALL  (I)  HAVE  MORE  THAN  ONE  HUNDRED
FULL-TIME EMPLOYEES EMPLOYED IN NEW YORK STATE, AND (II) HAVE A RATIO OF
RESEARCH  AND  DEVELOPMENT FUNDS TO NET SALES, AS REFERRED TO IN SECTION
THIRTY-ONE HUNDRED TWO-E OF THE PUBLIC AUTHORITIES LAW, WHICH EQUALS  OR
EXCEEDS THREE PERCENT DURING ITS TAXABLE YEAR.
  (C)  AN  ELIGIBLE  TAXPAYER  SHALL  BE ALLOWED A CREDIT FOR TWENTY PER
CENTUM OF THE ATTRIBUTABLE COST OR SIMILAR BASIS FOR FEDERAL INCOME  TAX
PURPOSES  OF  RESEARCH  AND  DEVELOPMENT  AND  MANUFACTURING PROPERTY AS
DEFINED IN PARAGRAPH (B) OF SUBDIVISION TWELVE OF THIS SECTION  THAT  IS
ACQUIRED  BY    THE TAXPAYER BY PURCHASE AS DEFINED IN SECTION 179(D) OF
THE INTERNAL REVENUE CODE AND PLACED IN SERVICE DURING THE TAXABLE YEAR.
PROVIDED, HOWEVER, FOR THE PURPOSES OF THIS PARAGRAPH ONLY, AN  ELIGIBLE
TAXPAYER  SHALL  BE  ALLOWED  A  CREDIT  FOR  SUCH PERCENTAGE OF THE (I)
ATTRIBUTABLE COST OR SIMILAR BASIS FOR FEDERAL INCOME TAX  PURPOSES  FOR
PROPERTY USED IN THE TESTING OR INSPECTION OF MATERIALS AND PRODUCTS,
  (II)  THE  ATTRIBUTABLE  COSTS  OR  EXPENSES  ASSOCIATED  WITH QUALITY
CONTROL OF THE RESEARCH AND DEVELOPMENT OR MANUFACTURING OPERATIONS,
  (III) ATTRIBUTABLE FEES FOR USE OF SOPHISTICATED TECHNOLOGY FACILITIES
AND PROCESSES,
  (IV) ATTRIBUTABLE FEES  FOR  THE  PRODUCTION  OR  EVENTUAL  COMMERCIAL
DISTRIBUTION  OF  MATERIALS  AND  PRODUCTS  RESULTING FROM THE QUALIFIED
MANUFACTURING ACTIVITIES OF AN ELIGIBLE TAXPAYER.
  (V) THE COSTS, EXPENSES AND  OTHER  AMOUNTS  FOR  WHICH  A  CREDIT  IS
ALLOWED AND CLAIMED UNDER THIS PARAGRAPH SHALL NOT BE USED IN THE CALCU-
LATION OF ANY OTHER CREDIT ALLOWED UNDER THIS ARTICLE.
  (D)  AN ELIGIBLE TAXPAYER SHALL BE ALLOWED A CREDIT FOR TEN PER CENTUM
OF "QUALIFIED RESEARCH AND MANUFACTURING EXPENSES" PAID OR  INCURRED  BY
THE  TAXPAYER IN THE TAXABLE YEAR. FOR THE PURPOSES OF THIS SECTION, THE
TERM "QUALIFIED RESEARCH AND MANUFACTURING EXPENSES" SHALL MEAN  ATTRIB-
UTABLE  EXPENSES  ASSOCIATED  WITH  IN-HOUSE  RESEARCH AND MANUFACTURING
PROCESSES, AND ATTRIBUTABLE COSTS ASSOCIATED WITH THE  DISSEMINATION  OF

S. 2522                             4

THE  RESULTS OF THE PRODUCTS THAT DIRECTLY RESULT FROM SUCH RESEARCH AND
DEVELOPMENT AND/OR MANUFACTURING  ACTIVITIES;  PROVIDED,  HOWEVER,  THAT
SUCH  COSTS  SHALL  NOT  INCLUDE  ADVERTISING  OR PROMOTION THROUGH PAID
MEDIA.    IN  ADDITION,  COSTS ASSOCIATED WITH THE PREPARATION OF PATENT
APPLICATIONS, PATENT APPLICATION  FILING  FEES,  PATENT  RESEARCH  FEES,
PATENT EXAMINATIONS FEES, PATENT POST ALLOWANCE FEES, PATENT MAINTENANCE
FEES, AND GRANT APPLICATION EXPENSES AND FEES SHALL BE ELIGIBLE FOR SUCH
CREDIT.   IN NO CASE SHALL THE CREDIT ALLOWED UNDER THIS PARAGRAPH APPLY
TO EXPENSES FOR LITIGATION OR THE CHALLENGE OF ANOTHER  ENTITY'S  INTEL-
LECTUAL PROPERTY RIGHTS, OR FOR CONTRACT EXPENSES INVOLVING OUTSIDE PAID
CONSULTANTS.    THE COSTS, EXPENSES AND OTHER AMOUNTS FOR WHICH A CREDIT
IS ALLOWED AND CLAIMED UNDER THIS PARAGRAPH SHALL NOT  BE  USED  IN  THE
CALCULATION OF ANY OTHER CREDIT ALLOWED UNDER THIS ARTICLE.
  (E)  AN ELIGIBLE TAXPAYER MAY CLAIM CREDITS UNDER THIS SUBDIVISION FOR
FOUR CONSECUTIVE TAXABLE YEARS. IN NO CASE SHALL THE CREDIT  ALLOWED  BY
THIS  SUBDIVISION  TO  A TAXPAYER EXCEED TWENTY-FIVE MILLION DOLLARS PER
YEAR.
  (F) 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 SUBDI-
VISION  FOR  ANY TAXABLE YEAR REDUCES THE TAX TO SUCH AMOUNT, ANY AMOUNT
OF CREDIT 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 THOU-
SAND  EIGHTY-EIGHT OF THIS CHAPTER NOTWITHSTANDING, NO INTEREST SHALL BE
PAID THEREON.
  S 4. Section 606 of the tax law is amended by adding a new  subsection
(vv) to read as follows:
  (VV)  QUALIFIED  SOLAR  AND ENERGY STORAGE MANUFACTURER FACILITIES AND
OPERATIONS CREDIT. (1) A TAXPAYER WHO IS A MEMBER OF AN ENTITY  CONSIST-
ING  OF ONE OR MORE TAXPAYERS THAT SERVES AS THE PRINCIPAL OPERATOR OF A
FACILITY PRIMARILY FUNCTIONING TO FABRICATE SOLAR  ENERGY  EQUIPMENT  OR
ENERGY  STORAGE EQUIPMENT AND THAT MEETS THE ELIGIBILITY REQUIREMENTS IN
PARAGRAPH TWO OF THIS SUBSECTION, SHALL BE ALLOWED A CREDIT AGAINST  THE
TAX  IMPOSED BY THIS ARTICLE. THE AMOUNT OF CREDIT SHALL BE EQUAL TO THE
SUM (OR PRO RATA SHARE OF THE SUM IN THE CASE OF A PARTNERSHIP)  OF  THE
AMOUNTS  SPECIFIED  IN  PARAGRAPHS  THREE  AND  FOUR  OF THIS SUBSECTION
SUBJECT TO THE LIMITATIONS IN PARAGRAPH FIVE OF THIS SUBSECTION. FOR THE
PURPOSES OF THIS SUBSECTION SOLAR ENERGY EQUIPMENT SHALL MEAN THE  MANU-
FACTURING  OF  MATERIAL COMPONENTS IN NEW YORK STATE DESIGNED TO PRODUCE
ELECTRICITY UTILIZING SOLAR RADIATION AS  THE  ENERGY  SOURCE  FOR  SUCH
ELECTRICITY;  AND  ENERGY  STORAGE  EQUIPMENT  SHALL  MEAN MATERIALS AND
DEVICES INTENDED TO STORE SOME FORM OF  ENERGY  RELATED  TO  NEW  ENERGY
TECHNOLOGIES AS DESCRIBED IN SUBDIVISION ONE OF SECTION EIGHTEEN HUNDRED
FIFTY-FOUR  OF  THE  PUBLIC AUTHORITIES LAW.   SUCH EQUIPMENT MAY EMPLOY
ELECTRICAL, ELECTROCHEMICAL, SUPERCAPACITOR, COMPRESSED GAS, MECHANICAL,
THERMAL OR OTHER MEANS SINGLY OR IN COMBINATION.  THE  DETERMINATION  OF
WHETHER SOLAR ENERGY EQUIPMENT OR ENERGY STORAGE EQUIPMENT QUALIFIES FOR
ELIGIBLE  COSTS UNDER THIS SUBSECTION SHALL BE DETERMINED BY THE COMMIS-
SIONER, AND, IF REQUESTED BY THE COMMISSIONER, THE PRESIDENT OF THE  NEW
YORK STATE ENERGY RESEARCH AND DEVELOPMENT AUTHORITY.
  (2)  AN ELIGIBLE ENTITY SHALL (I) HAVE MORE THAN ONE HUNDRED FULL-TIME
EMPLOYEES EMPLOYED IN NEW YORK STATE, AND (II) HAVE A RATIO OF  RESEARCH
AND DEVELOPMENT FUNDS TO NET SALES, AS REFERRED TO IN SECTION THIRTY-ONE

S. 2522                             5

HUNDRED  TWO-E  OF  THE  PUBLIC AUTHORITIES LAW, WHICH EQUALS OR EXCEEDS
THREE PERCENT DURING ITS TAXABLE YEAR.
  (3)  AN  ELIGIBLE  TAXPAYER  SHALL  BE ALLOWED A CREDIT FOR TWENTY PER
CENTUM OF THE COST OR SIMILAR BASIS  FOR  FEDERAL  INCOME  TAX  PURPOSES
INCURRED  BY  THE  ENTITY FOR RESEARCH AND DEVELOPMENT AND MANUFACTURING
PROPERTY AS DEFINED IN PARAGRAPH (B) OF SUBDIVISION  TWELVE  OF  SECTION
TWO  HUNDRED TEN OF THIS CHAPTER THAT IS ACQUIRED BY PURCHASE AS DEFINED
IN SECTION 179(D) OF THE INTERNAL REVENUE CODE  AND  PLACED  IN  SERVICE
DURING  THE  TAXABLE  YEAR.  PROVIDED, HOWEVER, FOR THE PURPOSES OF THIS
PARAGRAPH ONLY, AN ELIGIBLE TAXPAYER SHALL BE ALLOWED A CREDIT FOR  SUCH
PERCENTAGE  OF  THE  (I)  COST  OR  SIMILAR BASIS FOR FEDERAL INCOME TAX
PURPOSES FOR PROPERTY USED IN THE TESTING OR INSPECTION OF MATERIALS AND
PRODUCTS,
  (II) THE COSTS OR EXPENSES ASSOCIATED  WITH  QUALITY  CONTROL  OF  THE
RESEARCH AND DEVELOPMENT OR MANUFACTURING OPERATIONS,
  (III)  FEES  FOR  USE OF SOPHISTICATED TECHNOLOGY FACILITIES AND PROC-
ESSES,
  (IV) FEES FOR THE PRODUCTION OR EVENTUAL  COMMERCIAL  DISTRIBUTION  OF
MATERIALS  AND  PRODUCTS  RESULTING  FROM  THE ACTIVITIES OF AN ELIGIBLE
TAXPAYER AS LONG AS SUCH ACTIVITIES FALL UNDER THE ACTIVITIES LISTED  IN
PARAGRAPH  (B) OF SUBDIVISION ONE OF SECTION THIRTY-ONE HUNDRED TWO-E OF
THE PUBLIC AUTHORITIES LAW.
  (V) THE COSTS, EXPENSES AND  OTHER  AMOUNTS  FOR  WHICH  A  CREDIT  IS
ALLOWED AND CLAIMED UNDER THIS PARAGRAPH SHALL NOT BE USED IN THE CALCU-
LATION OF ANY OTHER CREDIT ALLOWED UNDER THIS ARTICLE.
  (4)  AN ELIGIBLE TAXPAYER SHALL BE ALLOWED A CREDIT FOR TEN PER CENTUM
OF "QUALIFIED RESEARCH AND MANUFACTURING EXPENSES" PAID OR  INCURRED  BY
THE  ENTITY  IN  THE TAXABLE YEAR. FOR THE PURPOSES OF THIS SECTION, THE
TERM "QUALIFIED RESEARCH AND MANUFACTURING EXPENSES" SHALL MEAN EXPENSES
ASSOCIATED WITH IN-HOUSE RESEARCH AND MANUFACTURING PROCESSES, AND COSTS
ASSOCIATED WITH THE DISSEMINATION OF THE RESULTS OF  THE  PRODUCTS  THAT
DIRECTLY  RESULT FROM SUCH RESEARCH AND DEVELOPMENT AND/OR MANUFACTURING
ACTIVITIES; PROVIDED, HOWEVER, THAT SUCH COSTS SHALL NOT INCLUDE  ADVER-
TISING  OR  PROMOTION  THROUGH PAID MEDIA. IN ADDITION, COSTS ASSOCIATED
WITH THE PREPARATION OF PATENT APPLICATIONS, PATENT  APPLICATION  FILING
FEES, PATENT RESEARCH FEES, PATENT EXAMINATIONS FEES, PATENT POST ALLOW-
ANCE  FEES,  PATENT MAINTENANCE FEES, AND GRANT APPLICATION EXPENSES AND
FEES SHALL BE ELIGIBLE FOR SUCH CREDIT. IN  NO  CASE  SHALL  THE  CREDIT
ALLOWED  UNDER  THIS  PARAGRAPH  APPLY TO EXPENSES FOR LITIGATION OR THE
CHALLENGE OF ANOTHER  ENTITY'S  INTELLECTUAL  PROPERTY  RIGHTS,  OR  FOR
CONTRACT   EXPENSES  INVOLVING  OUTSIDE  PAID  CONSULTANTS.  THE  COSTS,
EXPENSES AND OTHER AMOUNTS FOR WHICH A CREDIT  IS  ALLOWED  AND  CLAIMED
UNDER  THIS  PARAGRAPH SHALL NOT BE USED IN THE CALCULATION OF ANY OTHER
CREDIT ALLOWED UNDER THIS ARTICLE.
  (5) AN ELIGIBLE TAXPAYER MAY CLAIM CREDITS UNDER THIS  SUBSECTION  FOR
FOUR  CONSECUTIVE  TAXABLE YEARS. IN NO CASE SHALL THE CREDIT ALLOWED BY
THIS SUBDIVISION TO A TAXPAYER EXCEED TWENTY-FIVE  MILLION  DOLLARS  PER
YEAR.  IF THE TAXPAYER IS A PARTNER IN A PARTNERSHIP OR SHAREHOLDER OF A
NEW YORK S CORPORATION, THEN THE CAP IMPOSED BY THIS PARAGRAPH SHALL  BE
APPLIED AT THE ENTITY LEVEL, SO THAT THE AGGREGATE CREDIT ALLOWED TO ALL
THE  PARTNERS, SHAREHOLDERS, OR OTHER MEMBERS OF EACH SUCH ENTITY IN THE
TAXABLE YEAR DOES NOT EXCEED TWENTY-FIVE MILLION DOLLARS PER YEAR FOR UP
TO FOUR CONSECUTIVE TAXABLE YEARS.
  (6) IF THE AMOUNT OF 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

S. 2522                             6

ACCORDANCE WITH THE PROVISIONS OF SECTION SIX HUNDRED EIGHTY-SIX OF THIS
ARTICLE, PROVIDED, HOWEVER, THAT NO INTEREST SHALL BE PAID THEREON.
  S  5. Subparagraph (B) of paragraph 1 of subsection (i) of section 606
of the tax law is amended by adding a  new  clause  (xxxv)  to  read  as
follows:
(XXXV) CREDIT FOR                    AMOUNT OF CREDIT UNDER
QUALIFIED SOLAR AND ENERGY STORAGE   SUBDIVISION TWELVE-H OF
MANUFACTURER FACILITIES              SECTION TWO HUNDRED TEN
AND OPERATIONS CREDIT
UNDER SUBSECTION (VV)
  S  6. If any provision of this act is, for any reason, declared uncon-
stitutional or invalid, in whole or in part, by any court  of  competent
jurisdiction, such portion shall be deemed severable, and such unconsti-
tutionality or invalidity shall not affect the validity of the remaining
provisions  of  this  act,  which remaining provisions shall continue in
full force and effect.
  S 7. This act shall take effect immediately and sections  three,  four
and five of this act shall apply to taxable years commencing on or after
January 1, 2014.

Co-Sponsors

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S2522A (ACTIVE) - Bill Details

Current Committee:
Law Section:
Public Service Law
Laws Affected:
Add §66-n, Pub Serv L; ren §§1020-ii - 1020-kk to be §§1020-jj - 1020-ll, add §1020-ii, Pub Auth L; amd §§210 & 606, Tax L

S2522A (ACTIVE) - Bill Texts

view summary

Establishes a solar incentive program and a qualified solar and energy storage manufacturer facilities and operations credit.

view sponsor memo
BILL NUMBER:S2522A

TITLE OF BILL: An act to amend the public service law, the public
authorities law and the tax law, in relation to establishing a solar
incentive program and related tax credits

PURPOSE:

To establish a solar incentive program that includes an extension of
certain existing programs and the creation of new tax credits for
solar and energy storage manufacturing facilities.

SUMMARY OF PROVISIONS:

Sections 1 and 2 of the bill amend the public service law and the
public authorities law to codify the recently instituted NY Sun
Program.and to extend such program through calendar year 2023.

Sections 3, 4 & 5 of the bill amend various sections of the tax law to
establish the qualified solar and energy storage manufacturer
facilities and operations credit.

Section 6 of the bill is a severability clause.

Section 7 is the effective date.

JUSTIFICATION:

New York State must take measures to ensure that it remains at the
forefront of economical power generation and the delivery of
alternative and cleaner power. This legislation provides appropriate
incentives for solar power generation by including a long term
strategy for solar expansion with an equally important goal of
minimizing negative race payer impacts.

This legislation also seeks to capitalize on the growing solar and
energy storage segments of the energy sector through an appropriate
tax credit for manufacturer facilities. At the present time, New York
State is experiencing a lag in the development of these segments of
the renewable energy sector when compared to other states. Part of the
problem has been that there is no clear incentive for businesses to
make capital investments in solar and energy storage development.
This is both a necessary and prudent step because it will help New
York meet its goals for renewable energy. And, just as importantly, it
will help to create solar and energy storage manufacturing and
marketing jobs in New York State, rather than see them created in
another state or even worse, another country.

PRIOR LEGISLATIVE HISTORY:

New bill.

FISCAL IMPLICATIONS:

To be determined.

EFFECTIVE DATE:


This act shall take effect immediately and shall apply to taxable
years commencing on or after January 1, 2014.

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

                                 2522--A

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                            January 18, 2013
                               ___________

Introduced  by  Sens.  MAZIARZ,  ADDABBO, AVELLA, BALL, BOYLE, CARLUCCI,
  DILAN, ESPAILLAT, FARLEY, GIPSON, GRISANTI, HANNON, HOYLMAN,  KRUEGER,
  LARKIN,  LATIMER,  LAVALLE,  MARCELLINO,  MARTINS, MONTGOMERY, O'MARA,
  PARKER, PERKINS, RITCHIE, ROBACH, SAVINO, SERRANO, TKACZYK, VALESKY --
  read twice and ordered printed, and when printed to  be  committed  to
  the  Committee  on Energy and Telecommunications -- recommitted to the
  Committee on Energy and Telecommunications in accordance  with  Senate
  Rule  6,  sec.  8  --  committee  discharged,  bill  amended,  ordered
  reprinted as amended and recommitted to said committee

AN ACT to amend the public service law, the public authorities  law  and
  the tax law, in relation to establishing a solar incentive program and
  related tax credits

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

  Section 1.  The public service law is amended by adding a new  section
66-n to read as follows:
  S 66-N. SOLAR INCENTIVE PROGRAM. 1. AS USED IN THIS SECTION:
  (A)  "ELECTRIC  DISTRIBUTION COMPANY" MEANS AN INVESTOR-OWNED ELECTRIC
CORPORATION THAT DISTRIBUTES AND DELIVERS ELECTRICITY WITHIN THIS  STATE
AND HAS ANNUAL REVENUES IN EXCESS OF TWO HUNDRED MILLION DOLLARS; AND
  (B) "QUALIFIED SOLAR PHOTOVOLTAIC GENERATING SYSTEM" MEANS A SYSTEM OF
COMPONENTS OWNED OR DEVELOPED BY AN ENTITY OTHER THAN A PUBLIC AUTHORITY
OR  AN ELECTRIC DISTRIBUTION COMPANY AND THAT GENERATES ELECTRICITY FROM
SUNLIGHT BY MEANS OF THE PHOTOVOLTAIC EFFECT, WHETHER OR NOT THE  DEVICE
IS  COUPLED  WITH  A  DEVICE  CAPABLE OF STORING THE ENERGY PRODUCED FOR
LATER USE THAT IS (I) INSTALLED AND OPERATED IN NEW  YORK  STATE  WITHIN
ONE  OF  THE  SERVICE TERRITORIES OF AN ELECTRIC DISTRIBUTION COMPANY AS
DEFINED IN THIS SECTION, AND (II) INSTALLED  AFTER  JANUARY  FIRST,  TWO
THOUSAND FOURTEEN.
  2.  WITHIN  FORTY-FIVE DAYS OF THE EFFECTIVE DATE OF THIS SECTION, THE
COMMISSION SHALL COMMENCE THE  CONSIDERATION  OF  MODIFICATIONS  TO  ITS

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD04599-10-4

S. 2522--A                          2

EXISTING  PROGRAMS  THAT  ENCOURAGE  THE  DEVELOPMENT OF QUALIFIED SOLAR
PHOTOVOLTAIC GENERATING SYSTEMS AND, NO LATER THAN  JANUARY  FIRST,  TWO
THOUSAND  FOURTEEN, THE COMMISSION SHALL MAKE A DETERMINATION ESTABLISH-
ING  MODIFICATIONS  TO ITS EXISTING PROGRAMS THAT ENCOURAGE THE DEVELOP-
MENT OF QUALIFIED SOLAR PHOTOVOLTAIC GENERATING SYSTEMS  IN  CONFORMANCE
WITH  THIS SECTION. THE DEPARTMENT SHALL CONSULT WITH THE NEW YORK STATE
ENERGY RESEARCH AND DEVELOPMENT AUTHORITY  IN  THE  PREPARATION  OF  ITS
RECOMMENDATIONS  TO  THE  COMMISSION FOR SUCH DETERMINATION. THE PROGRAM
MODIFICATIONS SHALL REQUIRE:
  (A) ADMINISTRATION BY THE NEW YORK STATE ENERGY RESEARCH AND  DEVELOP-
MENT AUTHORITY;
  (B)  PLANNED  ANNUAL  EXPENDITURES INCLUDING ALL COSTS OF A MINIMUM OF
ONE HUNDRED EIGHT MILLION DOLLARS COMMENCING IN CALENDAR YEAR TWO  THOU-
SAND FOURTEEN AND SUSTAINED EACH YEAR THROUGH CALENDAR YEAR TWO THOUSAND
TWENTY-THREE;
  (C) A DIVERSITY OF PROJECT SIZES, GEOGRAPHIC DISTRIBUTION, AND PARTIC-
IPATION  AMONG CUSTOMER CLASSES, SUBJECT TO COST-EFFECTIVENESS CONSIDER-
ATIONS;
  (D) INCENTIVE STRUCTURES THAT MAXIMIZE COST-EFFECTIVENESS AND  PRACTI-
CALITY  THROUGH  COMPETITIVE  PROCUREMENTS,  STANDING-OFFERS, PRODUCTION
INCENTIVES OR CAPACITY INCENTIVES AT THE WHOLESALE OR RETAIL LEVEL AS IN
THE JUDGMENT OF THE COMMISSION, IN CONSULTATION WITH THE NEW YORK  INDE-
PENDENT SYSTEM OPERATOR, PROVIDE FOR THE MOST EFFECTIVE PROGRAM;
  (E)  INCENTIVE  STRUCTURES  THAT  TAKE INTO CONSIDERATION THE ECONOMIC
BENEFITS TO THE STATE OF NEW YORK;
  (F) PROGRAM DESIGNS THAT TAKE  INTO  CONSIDERATION  THE  AVOIDANCE  OF
LONG-TERM  COSTS TO THE TRANSMISSION AND DISTRIBUTION SYSTEM AND MINIMI-
ZATION OF PEAK LOAD IN CONSTRAINED AREAS;
  (G) ANNUAL REPORTS  ON  THE  ACHIEVEMENTS  AND  EFFECTIVENESS  OF  THE
PROGRAM; AND
  (H) SUCH OTHER ISSUES DEEMED APPROPRIATE BY THE COMMISSION.
  S  2.  Sections 1020-ii, 1020-jj and 1020-kk of the public authorities
law, as renumbered by chapter 388 of the laws of  2011,  are  renumbered
sections 1020-jj, 1020-kk and 1020-ll and a new section 1020-ii is added
to read as follows:
  S  1020-II.  ESTABLISHMENT  OF  SOLAR INCENTIVE PROGRAM. 1. AS USED IN
THIS SECTION THE TERM "QUALIFIED SOLAR PHOTOVOLTAIC  GENERATING  SYSTEM"
MEANS  A SYSTEM OF COMPONENTS OWNED OR DEVELOPED BY AN ENTITY OTHER THAN
A PUBLIC AUTHORITY OR AN ELECTRIC DISTRIBUTION COMPANY AND  THAT  GENER-
ATES  ELECTRICITY  FROM  SUNLIGHT  BY  MEANS OF THE PHOTOVOLTAIC EFFECT,
WHETHER OR NOT THE DEVICE IS COUPLED WITH A DEVICE  CAPABLE  OF  STORING
THE  ENERGY PRODUCED FOR LATER USE, THAT IS INSTALLED IN THE AUTHORITY'S
SERVICE TERRITORY AFTER JANUARY FIRST, TWO THOUSAND TWELVE.
  2. THE AUTHORITY SHALL CONTINUE TO ENCOURAGE THE DEVELOPMENT OF QUALI-
FIED SOLAR PHOTOVOLTAIC GENERATING  SYSTEMS  IN  ITS  SERVICE  TERRITORY
THROUGH IMPLEMENTATION OF THE SOLAR INCENTIVE PROGRAM. THE PROGRAM SHALL
REQUIRE:
  (A)  PLANNED  ANNUAL  EXPENDITURES  INCLUDING  ALL COSTS OF AT MINIMUM
THIRTY-EIGHT MILLION DOLLARS COMMENCING IN CALENDAR  YEAR  TWO  THOUSAND
FOURTEEN  AND  SUSTAINED  EACH  YEAR  THROUGH CALENDAR YEAR TWO THOUSAND
TWENTY-THREE;
  (B) A DIVERSITY OF PROJECT TYPES;
  (C) PROGRAM ADMINISTRATION AND DELIVERY;
  (D) INCENTIVE STRUCTURES THAT TAKE  INTO  CONSIDERATION  THE  ECONOMIC
BENEFITS TO THE STATE OF NEW YORK;

S. 2522--A                          3

  (E)  PROGRAM  DESIGNS  THAT  TAKE  INTO CONSIDERATION THE AVOIDANCE OF
LONG-TERM COSTS TO THE TRANSMISSION AND DISTRIBUTION SYSTEM AND  MINIMI-
ZATION  OF PEAK LOAD IN CONSTRAINED AREAS AND THAT MAXIMIZES COST-EFFEC-
TIVENESS THROUGH COMPETITIVE PROCUREMENTS;
  (F)  ANNUAL  REPORTS  ON  THE  ACHIEVEMENTS  AND  EFFECTIVENESS OF THE
PROGRAM; AND
  (G) ANY OTHER OBJECTIVES THE AUTHORITY MAY ESTABLISH.
  S 3. Section 210 of the tax law is amended by adding a new subdivision
12-H to read as follows:
  12-H.  QUALIFIED SOLAR AND ENERGY STORAGE MANUFACTURER FACILITIES  AND
OPERATIONS  CREDIT.  (A)  A  TAXPAYER THAT IS WHOLE OR PART OF AN ENTITY
THAT SERVES AS THE PRINCIPAL OPERATOR OF A FACILITY PRIMARILY  FUNCTION-
ING  TO FABRICATE SOLAR ENERGY EQUIPMENT OR ENERGY STORAGE EQUIPMENT AND
THAT MEETS THE ELIGIBILITY REQUIREMENTS IN PARAGRAPH (B) OF THIS  SUBDI-
VISION,  SHALL BE ALLOWED A CREDIT AGAINST THE TAX IMPOSED BY THIS ARTI-
CLE. THE AMOUNT OF CREDIT SHALL BE EQUAL TO THE SUM OF THE AMOUNTS SPEC-
IFIED IN PARAGRAPHS (C) AND (D) OF THIS SUBDIVISION ATTRIBUTABLE TO  THE
TAXPAYER  SUBJECT  TO  THE LIMITATIONS IN PARAGRAPH (E) OF THIS SUBDIVI-
SION. FOR THE PURPOSES OF THIS SUBDIVISION SOLAR ENERGY EQUIPMENT  SHALL
MEAN THE MANUFACTURING OF MATERIAL COMPONENTS IN NEW YORK STATE DESIGNED
TO  PRODUCE  ELECTRICITY  UTILIZING SOLAR RADIATION AS THE ENERGY SOURCE
FOR SUCH ELECTRICITY; AND ENERGY STORAGE EQUIPMENT SHALL MEAN  MATERIALS
AND  DEVICES INTENDED TO STORE SOME FORM OF ENERGY RELATED TO NEW ENERGY
TECHNOLOGIES AS DESCRIBED IN SUBDIVISION ONE OF SECTION EIGHTEEN HUNDRED
FIFTY-FOUR OF THE PUBLIC AUTHORITIES  LAW.  SUCH  EQUIPMENT  MAY  EMPLOY
ELECTRICAL, ELECTROCHEMICAL, SUPERCAPACITOR, COMPRESSED GAS, MECHANICAL,
THERMAL  OR  OTHER  DEMONSTRABLE  MEANS  SINGLY OR IN COMBINATION.   THE
DETERMINATION OF WHETHER SOLAR ENERGY EQUIPMENT OR ENERGY STORAGE EQUIP-
MENT QUALIFIES FOR ELIGIBLE COSTS UNDER THIS SUBDIVISION SHALL BE DETER-
MINED BY THE COMMISSIONER AND, IF REQUESTED  BY  THE  COMMISSIONER,  THE
PRESIDENT OF THE NEW YORK STATE ENERGY RESEARCH AND DEVELOPMENT AUTHORI-
TY.
  (B)  AN  ELIGIBLE  TAXPAYER  SHALL  (I)  HAVE  MORE  THAN  ONE HUNDRED
FULL-TIME EMPLOYEES EMPLOYED IN NEW YORK STATE, AND (II) HAVE A RATIO OF
RESEARCH AND DEVELOPMENT FUNDS TO NET SALES, AS REFERRED TO  IN  SECTION
THIRTY-ONE  HUNDRED TWO-E OF THE PUBLIC AUTHORITIES LAW, WHICH EQUALS OR
EXCEEDS THREE PERCENT DURING ITS TAXABLE YEAR.
  (C) AN ELIGIBLE TAXPAYER SHALL BE ALLOWED  A  CREDIT  FOR  TWENTY  PER
CENTUM  OF THE ATTRIBUTABLE COST OR SIMILAR BASIS FOR FEDERAL INCOME TAX
PURPOSES OF RESEARCH  AND  DEVELOPMENT  AND  MANUFACTURING  PROPERTY  AS
DEFINED  IN  PARAGRAPH (B) OF SUBDIVISION TWELVE OF THIS SECTION THAT IS
ACQUIRED BY  THE TAXPAYER BY PURCHASE AS DEFINED IN  SECTION  179(D)  OF
THE INTERNAL REVENUE CODE AND PLACED IN SERVICE DURING THE TAXABLE YEAR.
PROVIDED,  HOWEVER, FOR THE PURPOSES OF THIS PARAGRAPH ONLY, AN ELIGIBLE
TAXPAYER SHALL BE ALLOWED A  CREDIT  FOR  SUCH  PERCENTAGE  OF  THE  (I)
ATTRIBUTABLE  COST  OR SIMILAR BASIS FOR FEDERAL INCOME TAX PURPOSES FOR
PROPERTY USED IN THE TESTING OR INSPECTION OF MATERIALS AND PRODUCTS,
  (II) THE  ATTRIBUTABLE  COSTS  OR  EXPENSES  ASSOCIATED  WITH  QUALITY
CONTROL OF THE RESEARCH AND DEVELOPMENT OR MANUFACTURING OPERATIONS,
  (III) ATTRIBUTABLE FEES FOR USE OF SOPHISTICATED TECHNOLOGY FACILITIES
AND PROCESSES,
  (IV)  ATTRIBUTABLE  FEES  FOR  THE  PRODUCTION  OR EVENTUAL COMMERCIAL
DISTRIBUTION OF MATERIALS AND  PRODUCTS  RESULTING  FROM  THE  QUALIFIED
MANUFACTURING ACTIVITIES OF AN ELIGIBLE TAXPAYER.

S. 2522--A                          4

  (V)  THE  COSTS,  EXPENSES  AND  OTHER  AMOUNTS  FOR WHICH A CREDIT IS
ALLOWED AND CLAIMED UNDER THIS PARAGRAPH SHALL NOT BE USED IN THE CALCU-
LATION OF ANY OTHER CREDIT ALLOWED UNDER THIS ARTICLE.
  (D)  AN ELIGIBLE TAXPAYER SHALL BE ALLOWED A CREDIT FOR TEN PER CENTUM
OF "QUALIFIED RESEARCH AND MANUFACTURING EXPENSES" PAID OR  INCURRED  BY
THE  TAXPAYER IN THE TAXABLE YEAR. FOR THE PURPOSES OF THIS SECTION, THE
TERM "QUALIFIED RESEARCH AND MANUFACTURING EXPENSES" SHALL MEAN  ATTRIB-
UTABLE  EXPENSES  ASSOCIATED  WITH  IN-HOUSE  RESEARCH AND MANUFACTURING
PROCESSES, AND ATTRIBUTABLE COSTS ASSOCIATED WITH THE  DISSEMINATION  OF
THE  RESULTS OF THE PRODUCTS THAT DIRECTLY RESULT FROM SUCH RESEARCH AND
DEVELOPMENT AND/OR MANUFACTURING  ACTIVITIES;  PROVIDED,  HOWEVER,  THAT
SUCH  COSTS  SHALL  NOT  INCLUDE  ADVERTISING  OR PROMOTION THROUGH PAID
MEDIA.  IN ADDITION, COSTS ASSOCIATED WITH  THE  PREPARATION  OF  PATENT
APPLICATIONS,  PATENT  APPLICATION  FILING  FEES,  PATENT RESEARCH FEES,
PATENT EXAMINATIONS FEES, PATENT POST ALLOWANCE FEES, PATENT MAINTENANCE
FEES, AND GRANT APPLICATION EXPENSES AND FEES SHALL BE ELIGIBLE FOR SUCH
CREDIT.  IN NO CASE SHALL THE CREDIT ALLOWED UNDER THIS PARAGRAPH  APPLY
TO  EXPENSES  FOR LITIGATION OR THE CHALLENGE OF ANOTHER ENTITY'S INTEL-
LECTUAL PROPERTY RIGHTS, OR FOR CONTRACT EXPENSES INVOLVING OUTSIDE PAID
CONSULTANTS.  THE COSTS, EXPENSES AND OTHER AMOUNTS FOR WHICH  A  CREDIT
IS  ALLOWED  AND  CLAIMED  UNDER THIS PARAGRAPH SHALL NOT BE USED IN THE
CALCULATION OF ANY OTHER CREDIT ALLOWED UNDER THIS ARTICLE.
  (E) AN ELIGIBLE TAXPAYER MAY CLAIM CREDITS UNDER THIS SUBDIVISION  FOR
FOUR  CONSECUTIVE  TAXABLE YEARS. IN NO CASE SHALL THE CREDIT ALLOWED BY
THIS SUBDIVISION TO A TAXPAYER EXCEED TWENTY-FIVE  MILLION  DOLLARS  PER
YEAR.
  (F)  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 SUBDI-
VISION FOR ANY TAXABLE YEAR REDUCES THE TAX TO SUCH AMOUNT,  ANY  AMOUNT
OF  CREDIT  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 THOU-
SAND EIGHTY-EIGHT OF THIS CHAPTER NOTWITHSTANDING, NO INTEREST SHALL  BE
PAID THEREON.
  S  4.  Subdivisions  (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) QUALIFIED SOLAR AND ENERGY STORAGE  MANUFACTURER  FACILITIES  AND
OPERATIONS  CREDIT. (1) A TAXPAYER WHO IS A MEMBER OF AN ENTITY CONSIST-
ING OF ONE OR MORE TAXPAYERS THAT SERVES AS THE PRINCIPAL OPERATOR OF  A
FACILITY  PRIMARILY  FUNCTIONING  TO FABRICATE SOLAR ENERGY EQUIPMENT OR
ENERGY STORAGE EQUIPMENT AND THAT MEETS THE ELIGIBILITY REQUIREMENTS  IN
PARAGRAPH  TWO OF THIS SUBSECTION, SHALL BE ALLOWED A CREDIT AGAINST THE
TAX IMPOSED BY THIS ARTICLE. THE AMOUNT OF CREDIT SHALL BE EQUAL TO  THE
SUM  (OR  PRO RATA SHARE OF THE SUM IN THE CASE OF A PARTNERSHIP) OF THE
AMOUNTS SPECIFIED IN  PARAGRAPHS  THREE  AND  FOUR  OF  THIS  SUBSECTION
SUBJECT TO THE LIMITATIONS IN PARAGRAPH FIVE OF THIS SUBSECTION. FOR THE
PURPOSES  OF THIS SUBSECTION SOLAR ENERGY EQUIPMENT SHALL MEAN THE MANU-
FACTURING OF MATERIAL COMPONENTS IN NEW YORK STATE DESIGNED  TO  PRODUCE
ELECTRICITY  UTILIZING  SOLAR  RADIATION  AS  THE ENERGY SOURCE FOR SUCH
ELECTRICITY; AND ENERGY  STORAGE  EQUIPMENT  SHALL  MEAN  MATERIALS  AND
DEVICES  INTENDED  TO  STORE  SOME  FORM OF ENERGY RELATED TO NEW ENERGY

S. 2522--A                          5

TECHNOLOGIES AS DESCRIBED IN SUBDIVISION ONE OF SECTION EIGHTEEN HUNDRED
FIFTY-FOUR OF THE PUBLIC AUTHORITIES LAW.   SUCH  EQUIPMENT  MAY  EMPLOY
ELECTRICAL, ELECTROCHEMICAL, SUPERCAPACITOR, COMPRESSED GAS, MECHANICAL,
THERMAL  OR  OTHER  MEANS SINGLY OR IN COMBINATION. THE DETERMINATION OF
WHETHER SOLAR ENERGY EQUIPMENT OR ENERGY STORAGE EQUIPMENT QUALIFIES FOR
ELIGIBLE COSTS UNDER THIS SUBSECTION SHALL BE DETERMINED BY THE  COMMIS-
SIONER,  AND, IF REQUESTED BY THE COMMISSIONER, THE PRESIDENT OF THE NEW
YORK STATE ENERGY RESEARCH AND DEVELOPMENT AUTHORITY.
  (2) AN ELIGIBLE ENTITY SHALL (I) HAVE MORE THAN ONE HUNDRED  FULL-TIME
EMPLOYEES  EMPLOYED IN NEW YORK STATE, AND (II) HAVE A RATIO OF RESEARCH
AND DEVELOPMENT FUNDS TO NET SALES, AS REFERRED TO IN SECTION THIRTY-ONE
HUNDRED TWO-E OF THE PUBLIC AUTHORITIES LAW,  WHICH  EQUALS  OR  EXCEEDS
THREE PERCENT DURING ITS TAXABLE YEAR.
  (3)  AN  ELIGIBLE  TAXPAYER  SHALL  BE ALLOWED A CREDIT FOR TWENTY PER
CENTUM OF THE COST OR SIMILAR BASIS  FOR  FEDERAL  INCOME  TAX  PURPOSES
INCURRED  BY  THE  ENTITY FOR RESEARCH AND DEVELOPMENT AND MANUFACTURING
PROPERTY AS DEFINED IN PARAGRAPH (B) OF SUBDIVISION  TWELVE  OF  SECTION
TWO  HUNDRED TEN OF THIS CHAPTER THAT IS ACQUIRED BY PURCHASE AS DEFINED
IN SECTION 179(D) OF THE INTERNAL REVENUE CODE  AND  PLACED  IN  SERVICE
DURING  THE  TAXABLE  YEAR.  PROVIDED, HOWEVER, FOR THE PURPOSES OF THIS
PARAGRAPH ONLY, AN ELIGIBLE TAXPAYER SHALL BE ALLOWED A CREDIT FOR  SUCH
PERCENTAGE  OF  THE  (I)  COST  OR  SIMILAR BASIS FOR FEDERAL INCOME TAX
PURPOSES FOR PROPERTY USED IN THE TESTING OR INSPECTION OF MATERIALS AND
PRODUCTS,
  (II) THE COSTS OR EXPENSES ASSOCIATED  WITH  QUALITY  CONTROL  OF  THE
RESEARCH AND DEVELOPMENT OR MANUFACTURING OPERATIONS,
  (III)  FEES  FOR  USE OF SOPHISTICATED TECHNOLOGY FACILITIES AND PROC-
ESSES,
  (IV) FEES FOR THE PRODUCTION OR EVENTUAL  COMMERCIAL  DISTRIBUTION  OF
MATERIALS  AND  PRODUCTS  RESULTING  FROM  THE ACTIVITIES OF AN ELIGIBLE
TAXPAYER AS LONG AS SUCH ACTIVITIES FALL UNDER THE ACTIVITIES LISTED  IN
PARAGRAPH  (B) OF SUBDIVISION ONE OF SECTION THIRTY-ONE HUNDRED TWO-E OF
THE PUBLIC AUTHORITIES LAW.
  (V) THE COSTS, EXPENSES AND  OTHER  AMOUNTS  FOR  WHICH  A  CREDIT  IS
ALLOWED AND CLAIMED UNDER THIS PARAGRAPH SHALL NOT BE USED IN THE CALCU-
LATION OF ANY OTHER CREDIT ALLOWED UNDER THIS ARTICLE.
  (4)  AN ELIGIBLE TAXPAYER SHALL BE ALLOWED A CREDIT FOR TEN PER CENTUM
OF "QUALIFIED RESEARCH AND MANUFACTURING EXPENSES" PAID OR  INCURRED  BY
THE  ENTITY  IN  THE TAXABLE YEAR. FOR THE PURPOSES OF THIS SECTION, THE
TERM "QUALIFIED RESEARCH AND MANUFACTURING EXPENSES" SHALL MEAN EXPENSES
ASSOCIATED WITH IN-HOUSE RESEARCH AND MANUFACTURING PROCESSES, AND COSTS
ASSOCIATED WITH THE DISSEMINATION OF THE RESULTS OF  THE  PRODUCTS  THAT
DIRECTLY  RESULT FROM SUCH RESEARCH AND DEVELOPMENT AND/OR MANUFACTURING
ACTIVITIES; PROVIDED, HOWEVER, THAT SUCH COSTS SHALL NOT INCLUDE  ADVER-
TISING  OR  PROMOTION  THROUGH PAID MEDIA. IN ADDITION, COSTS ASSOCIATED
WITH THE PREPARATION OF PATENT APPLICATIONS, PATENT  APPLICATION  FILING
FEES, PATENT RESEARCH FEES, PATENT EXAMINATIONS FEES, PATENT POST ALLOW-
ANCE  FEES,  PATENT MAINTENANCE FEES, AND GRANT APPLICATION EXPENSES AND
FEES SHALL BE ELIGIBLE FOR SUCH CREDIT. IN  NO  CASE  SHALL  THE  CREDIT
ALLOWED  UNDER  THIS  PARAGRAPH  APPLY TO EXPENSES FOR LITIGATION OR THE
CHALLENGE OF ANOTHER  ENTITY'S  INTELLECTUAL  PROPERTY  RIGHTS,  OR  FOR
CONTRACT   EXPENSES  INVOLVING  OUTSIDE  PAID  CONSULTANTS.  THE  COSTS,
EXPENSES AND OTHER AMOUNTS FOR WHICH A CREDIT  IS  ALLOWED  AND  CLAIMED
UNDER  THIS  PARAGRAPH SHALL NOT BE USED IN THE CALCULATION OF ANY OTHER
CREDIT ALLOWED UNDER THIS ARTICLE.

S. 2522--A                          6

  (5) AN ELIGIBLE TAXPAYER MAY CLAIM CREDITS UNDER THIS  SUBSECTION  FOR
FOUR  CONSECUTIVE  TAXABLE YEARS. IN NO CASE SHALL THE CREDIT ALLOWED BY
THIS SUBDIVISION TO A TAXPAYER EXCEED TWENTY-FIVE  MILLION  DOLLARS  PER
YEAR.  IF THE TAXPAYER IS A PARTNER IN A PARTNERSHIP OR SHAREHOLDER OF A
NEW  YORK S CORPORATION, THEN THE CAP IMPOSED BY THIS PARAGRAPH SHALL BE
APPLIED AT THE ENTITY LEVEL, SO THAT THE AGGREGATE CREDIT ALLOWED TO ALL
THE PARTNERS, SHAREHOLDERS, OR OTHER MEMBERS OF EACH SUCH ENTITY IN  THE
TAXABLE YEAR DOES NOT EXCEED TWENTY-FIVE MILLION DOLLARS PER YEAR FOR UP
TO FOUR CONSECUTIVE TAXABLE YEARS.
  (6)  IF  THE  AMOUNT  OF  CREDIT ALLOWED UNDER THIS SUBSECTION FOR ANY
TAXABLE YEAR SHALL EXCEED THE TAXPAYER'S TAX FOR SUCH YEAR,  THE  EXCESS
SHALL  BE TREATED AS AN OVERPAYMENT OF TAX TO BE CREDITED OR REFUNDED IN
ACCORDANCE WITH THE PROVISIONS OF SECTION SIX HUNDRED EIGHTY-SIX OF THIS
ARTICLE, PROVIDED, HOWEVER, THAT NO INTEREST SHALL BE PAID THEREON.
  S 5. 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) CREDIT FOR                  AMOUNT OF CREDIT UNDER
QUALIFIED SOLAR AND ENERGY STORAGE   SUBDIVISION TWELVE-H OF
MANUFACTURER FACILITIES              SECTION TWO HUNDRED TEN
AND OPERATIONS CREDIT
UNDER SUBSECTION (XX)
  S 6. If any provision of this act is, for any reason, declared  uncon-
stitutional  or  invalid, in whole or in part, by any court of competent
jurisdiction, such portion shall be deemed severable, and such unconsti-
tutionality or invalidity shall not affect the validity of the remaining
provisions of this act, which remaining  provisions  shall  continue  in
full force and effect.
  S  7.  This act shall take effect immediately and sections three, four
and five of this act shall apply to taxable years commencing on or after
January 1, 2014.

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