Senate Bill S2609

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

    S. 2609--A                                            A. 3009--A

                      S E N A T E - A S S E M B L Y

                            January 22, 2013
                               ___________

IN  SENATE -- A BUDGET BILL, submitted by the Governor pursuant to arti-
  cle seven of the Constitution -- read twice and ordered  printed,  and
  when  printed to be committed to the Committee on Finance -- committee
  discharged, bill amended, ordered reprinted as amended and recommitted
  to said committee

IN ASSEMBLY -- A BUDGET BILL, submitted  by  the  Governor  pursuant  to
  article  seven  of  the  Constitution -- read once and referred to the
  Committee on Ways and Means --  committee  discharged,  bill  amended,
  ordered reprinted as amended and recommitted to said committee

AN  ACT  to amend the tax law, in relation to the temporary metropolitan
  transportation business tax surcharge (Part A); to amend the tax  law,
  in  relation to the empire state film production credit and the empire
  state film post production credit; and to amend part Y-1 of chapter 57
  of the laws of 2009 amending the tax law relating to the empire  state
  film  production credit, in relation to reports (Part B); to amend the
  economic development law, the tax law and the administrative  code  of
  the  city  of New York, in relation to establishing the New York inno-
  vation hot spot program (Part C); to amend the tax law and the  admin-
  istrative  code  of the city of New York, in relation to extending for
  three years the charitable contributions  deduction  limitation  (Part
  D);  to  amend  the tax law and the administrative code of the city of
  New York, in relation to the exclusion  of  certain  royalty  payments
  from  the  entire  net  income or other taxable basis of corporations,
  banking corporations, and insurance corporations, from  the  unrelated
  business income of corporations, and from the adjusted gross income of
  individual  taxpayers; and to repeal certain provisions of the tax law
  relating thereto (Part E); to amend the tax law, in  relation  to  the
  historic  preservation  tax  credit (Part F); to amend the tax law, in
  relation to providing a tax credit  for  electric  vehicle  recharging
  property  (Part  G);  to amend chapter 61 of the laws of 2011 amending
  the real property tax law and  other  laws  relating  to  establishing
  standards for electronic real property tax administration, in relation
  to  making  permanent,  provisions  relating  to  mandatory electronic
  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

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
              

                      [ ] is old law to be omitted.
                                                           LBD12574-02-3

S. 2609--A                          2                         A. 3009--A

  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); and to amend the tax law, in relation to
  the credit for the rehabilitation of historic homes (Part V)

S. 2609--A                          3                         A. 3009--A

  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 V. 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
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-

S. 2609--A                          4                         A. 3009--A

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
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

S. 2609--A                          5                         A. 3009--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-
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

S. 2609--A                          6                         A. 3009--A

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
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

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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
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

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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
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

S. 2609--A                          9                         A. 3009--A

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
(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,

S. 2609--A                         10                         A. 3009--A

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
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

S. 2609--A                         11                         A. 3009--A

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
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. 2609--A                         12                         A. 3009--A

  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
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

S. 2609--A                         13                         A. 3009--A

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
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

S. 2609--A                         14                         A. 3009--A

  (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
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;

S. 2609--A                         15                         A. 3009--A

  (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 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.

S. 2609--A                         16                         A. 3009--A

  (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,
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:

S. 2609--A                         17                         A. 3009--A

  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
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

S. 2609--A                         18                         A. 3009--A

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
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.

S. 2609--A                         19                         A. 3009--A

  (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-
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

S. 2609--A                         20                         A. 3009--A

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
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

S. 2609--A                         21                         A. 3009--A

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".
  (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

S. 2609--A                         22                         A. 3009--A

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
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

S. 2609--A                         23                         A. 3009--A

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
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. 2609--A                         24                         A. 3009--A

  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,
related  to  or  in connection with the acquisition, use, maintenance or
management, ownership, sale, exchange or disposition of such  intangible
assets.

S. 2609--A                         25                         A. 3009--A

  (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
APPLIED  TO  THE  TAXPAYER UNDER SECTION SIX HUNDRED ONE OF THIS ARTICLE
FOR THE TAXABLE YEAR.

S. 2609--A                         26                         A. 3009--A

  (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-
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

S. 2609--A                         27                         A. 3009--A

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
royalty  payments would not be required to be added back under paragraph
two of this subsection or other  similar  provision  in  this  chapter.]

S. 2609--A                         28                         A. 3009--A

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
person, corporation, or entity, or set of related persons,  corporations
or  entities,  directly  or  indirectly  owns  or controls a controlling

S. 2609--A                         29                         A. 3009--A

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)
of section fifteen hundred fifteen of this article, for the  purpose  of
computing  entire  net income, a taxpayer must add back royalty payments

S. 2609--A                         30                         A. 3009--A

[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
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

S. 2609--A                         31                         A. 3009--A

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,
trade names, trade dress, service  marks,  mask  works,  trade  secrets,
patents  and  any other similar types of intangible assets as determined

S. 2609--A                         32                         A. 3009--A

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
THIS  CITY OR ANOTHER CITY WITHIN THE UNITED STATES, OR SOME COMBINATION
THEREOF; (II) THE TAX BASE FOR SAID TAX  INCLUDED  THE  ROYALTY  PAYMENT

S. 2609--A                         33                         A. 3009--A

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,
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

S. 2609--A                         34                         A. 3009--A

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
THIS  PARAGRAPH  SHALL  NOT  APPLY TO THE PORTION OF THE ROYALTY PAYMENT
THAT THE TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE  OF  THE

S. 2609--A                         35                         A. 3009--A

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
taxpayers under this title].  "RELATED MEMBER" MEANS A RELATED PERSON AS
DEFINED  IN  SUBPARAGRAPH  (C)  OF  PARAGRAPH THREE OF SUBSECTION (B) OF

S. 2609--A                         36                         A. 3009--A

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:
  (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--A                         37                         A. 3009--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
APPLICATION OR USE OF ALTERNATIVE ADJUSTMENTS OR COMPUTATIONS WHEN HE OR

S. 2609--A                         38                         A. 3009--A

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.
  (D) Valid business purpose. A valid business purpose is  one  or  more
business  purposes,  other  than the avoidance or reduction of taxation,

S. 2609--A                         39                         A. 3009--A

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.
  (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

S. 2609--A                         40                         A. 3009--A

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.
  (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

S. 2609--A                         41                         A. 3009--A

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
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

S. 2609--A                         42                         A. 3009--A

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
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-

S. 2609--A                         43                         A. 3009--A

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]
  (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

S. 2609--A                         44                         A. 3009--A

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:
  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

S. 2609--A                         45                         A. 3009--A

[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
of recovery years prior to, but not including, the recapture  year,  and
the denominator of which is the total recovery period.

S. 2609--A                         46                         A. 3009--A

  [(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
  (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.

S. 2609--A                         47                         A. 3009--A

  (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.
  [(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

S. 2609--A                         48                         A. 3009--A

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
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;

S. 2609--A                         49                         A. 3009--A

  (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
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)

S. 2609--A                         50                         A. 3009--A

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  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. 2609--A                         51                         A. 3009--A

  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
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

S. 2609--A                         52                         A. 3009--A

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
forty-six  and  eighty-seven  hundredths  feet  to a point; thence south
twenty-eight degrees thirty-seven  minutes  and  fifty  seconds  east  a

S. 2609--A                         53                         A. 3009--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,
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

S. 2609--A                         54                         A. 3009--A

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
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

S. 2609--A                         55                         A. 3009--A

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
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

S. 2609--A                         56                         A. 3009--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"
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

S. 2609--A                         57                         A. 3009--A

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
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

S. 2609--A                         58                         A. 3009--A

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
built  upon  land  adjoining on the North; thence Westerly parallel with
said garage, Forty-six and Seven-tenths (46.7)  feet;  thence  Southerly

S. 2609--A                         59                         A. 3009--A

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
(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)

S. 2609--A                         60                         A. 3009--A

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
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

S. 2609--A                         61                         A. 3009--A

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
of a license for on-premises consumption under this chapter, nor  (2)  a
manufacturer  from  acquiring  any such premises if the liquor authority

S. 2609--A                         62                         A. 3009--A

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
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

S. 2609--A                         63                         A. 3009--A

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
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.

S. 2609--A                         64                         A. 3009--A

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
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

S. 2609--A                         65                         A. 3009--A

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
COMMENCED BY AN IDA, TOGETHER WITH ANY INTEREST  OR  PENALTIES  THEREON,
PURSUANT TO SUBDIVISION SIX OR EIGHT OF THIS SECTION, AS STATE SALES AND

S. 2609--A                         66                         A. 3009--A

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
TO THE PROVISIONS OF THIS TITLE AND TO THE  AUTHORITY  CREATED  BY  THIS
TITLE.

S. 2609--A                         67                         A. 3009--A

  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 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. 2609--A                         68                         A. 3009--A

  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
BY THE COMMISSIONER OF TAXATION AND FINANCE, IDENTIFYING EACH SUCH AGENT
SO NAMED BY THE AUTHORITY IN THE ORIGINAL DESIGNATION AND SETTING  FORTH

S. 2609--A                         69                         A. 3009--A

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.

                                 PART K

S. 2609--A                         70                         A. 3009--A

  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
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

S. 2609--A                         71                         A. 3009--A

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-
SHIP (CONTROLLING INTEREST MEANING MORE THAN FIFTY PERCENT OF THE  CAPI-
TAL,  PROFITS OR BENEFICIAL INTEREST IN SUCH PARTNERSHIP) who owned more

S. 2609--A                         72                         A. 3009--A

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
more  than  [one  year]  FIVE  YEARS  prior to the date of revocation or
suspension.

S. 2609--A                         73                         A. 3009--A

  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
the commissioner may prescribe, a new certificate of authority,  without

S. 2609--A                         74                         A. 3009--A

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--A                         75                         A. 3009--A

  (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--A                         76                         A. 3009--A

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--A                         77                         A. 3009--A

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--A                         78                         A. 3009--A

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--A                         79                         A. 3009--A

  (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--A                         80                         A. 3009--A

  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--A                         81                         A. 3009--A

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--A                         82                         A. 3009--A

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--A                         83                         A. 3009--A

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--A                         84                         A. 3009--A

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--A                         85                         A. 3009--A

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--A                         86                         A. 3009--A

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--A                         87                         A. 3009--A

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--A                         88                         A. 3009--A

  (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--A                         89                         A. 3009--A

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--A                         90                         A. 3009--A

  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--A                         91                         A. 3009--A

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--A                         92                         A. 3009--A

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--A                         93                         A. 3009--A

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.
  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  3.  This  act shall take effect immediately provided, however, that
the applicable effective date of Parts A through V of this act shall  be
as specifically set forth in the last section of such Parts.

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

    S. 2609--B                                            A. 3009--B

                      S E N A T E - A S S E M B L Y

                            January 22, 2013
                               ___________

IN  SENATE -- A BUDGET BILL, submitted by the Governor pursuant to arti-
  cle seven of the Constitution -- read twice and ordered  printed,  and
  when  printed to be committed to the Committee on Finance -- committee
  discharged, bill amended, ordered reprinted as amended and recommitted
  to said committee  --  committee  discharged,  bill  amended,  ordered
  reprinted as amended and recommitted to said committee

IN  ASSEMBLY  --  A  BUDGET  BILL, submitted by the Governor pursuant to
  article seven of the Constitution -- read once  and  referred  to  the
  Committee  on  Ways  and  Means -- committee discharged, bill amended,
  ordered reprinted as amended and  recommitted  to  said  committee  --
  again  reported from said committee with amendments, ordered reprinted
  as amended and recommitted to said committee

AN ACT to amend the tax law, in relation to the  temporary  metropolitan
  transportation  business tax surcharge (Part A); to amend the tax law,
  in relation to the empire state film production credit and the  empire
  state film post production credit; and to amend part Y-1 of chapter 57
  of  the laws of 2009 amending the tax law relating to the empire state
  film production credit, in relation to reports (Part B); to amend  the
  economic  development  law, the tax law and the administrative code of
  the city of New York, in relation to establishing the New  York  inno-
  vation  hot spot program (Part C); to amend the tax law and the admin-
  istrative code of the city of New York, in relation to  extending  for
  three  years  the  charitable contributions deduction limitation (Part
  D); to amend the tax law and the administrative code of  the  city  of
  New  York,  in  relation  to the exclusion of certain royalty payments
  from the entire net income or other  taxable  basis  of  corporations,
  banking  corporations,  and insurance corporations, from the unrelated
  business income of corporations, and from the adjusted gross income of
  individual taxpayers; and to repeal certain provisions of the tax  law
  relating  thereto  (Part  E); to amend the tax law, in relation to the
  historic preservation tax credit (Part F); to amend the  tax  law,  in
  relation  to  providing  a  tax credit for electric vehicle recharging
  property (Part G); to amend chapter 61 of the laws  of  2011  amending
  the  real  property  tax  law  and other laws relating to establishing
  standards for electronic real property tax administration, in relation
  to making  permanent,  provisions  relating  to  mandatory  electronic

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
              

                      [ ] 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.

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

                                 2609--C

                            I N  S E N A T E

                            January 22, 2013
                               ___________

A  BUDGET  BILL,  submitted by the Governor pursuant to article seven of
  the Constitution -- read twice and ordered printed, and  when  printed
  to  be  committed to the Committee on Finance -- committee discharged,
  bill amended, ordered reprinted as amended  and  recommitted  to  said
  committee  -- committee discharged, bill amended, ordered reprinted as
  amended and recommitted to said  committee  --  committee  discharged,
  bill  amended,  ordered  reprinted  as amended and recommitted to said
  committee

AN ACT to amend the tax law, in relation to the  temporary  metropolitan
  transportation  business tax surcharge (Part A); to direct the commis-
  sioner of economic development to commission a study of the state film
  tax credit; to amend the tax law, in relation to the empire state film
  production credit and the empire state film  post  production  credit;
  and  to  amend part Y-1 of chapter 57 of the laws of 2009 amending the
  tax law relating to  the  empire  state  film  production  credit,  in
  relation  to  reports (Part B); Intentionally omitted (Part C); Inten-
  tionally omitted (Part D); Intentionally omitted (Part  E);  to  amend
  the tax law, in relation to the historic preservation tax credit (Part
  F);  to  amend  the tax law, in relation to providing a tax credit for
  electric vehicle recharging property (Part G);  Intentionally  omitted
  (Part  H); Intentionally omitted (Part I); Intentionally omitted (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 exclusively and directly in the engine of a  motor
  vehicle (Part K); to amend the tax law, in relation to allowing volun-
  tary  ambulance services, fire companies, fire departments and  rescue
  squads to claim exemption from the petroleum  business  tax  for  fuel
  used  in  their  vehicles (Part L); Intentionally omitted (Part M); to
  amend the tax law, in relation to allowing the department of  taxation
  and  finance to refuse a certificate 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);
  Intentionally  omitted  (Part  P);  Intentionally omitted (Part Q); to
  amend the tax law, in relation to the authority of counties to  impose

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
              

                      [ ] is old law to be omitted.
                                                           LBD12574-05-3

S. 2609--C                          2

  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,  simul-
  casting  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-mutuel 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
  the  effectiveness of certain provisions thereof; to amend the racing,
  pari-mutuel wagering and breeding law, in relation to  the  effective-
  ness  of certain provisions thereof (Part U); to amend the tax law, in
  relation to the credit for the rehabilitation of historic homes  (Part
  V);  to  amend  the  tax law, in relation to allowing certain tax-free
  interdistributor sales of highway diesel motor fuel (Part W); to amend
  the tax law, in relation to updating  the  farming  exemption  in  the
  highway  use  tax  to  reflect  current industry practice (Part X); to
  amend the tax law, in relation to New York exemptions  of  a  resident
  individual; to amend the tax law, in relation to establishing an addi-
  tional  credit  for  certain household and dependent care services; to
  amend the tax law, in relation to establishing  an  additional  Empire
  state  child credit; to amend the tax law, in relation to establishing
  the supplemental child tax credit;  and  to  amend  the  tax  law,  in
  relation  to  the  disallowance of additional tax credits (Part Y); to
  amend the real property tax law and the tax law, in relation to  rein-
  stating the "Middle Class STAR" rebate program (Part Z); intentionally
  omitted  (Part  AA); intentionally omitted (Part BB); to amend the tax
  law, in relation to establishing business franchise, personal  income,
  banking franchise and insurance franchise tax credits for a portion of
  the  wages  paid  to certain veterans (Part CC); to amend the economic
  development law, in  relation  to  increases  to  the  excelsior  jobs
  program  (Part  DD); intentionally omitted (Part EE); to amend the New
  York state urban development corporation act, in relation to  the  New
  York  state  small  business incubator support act (Part FF); to amend
  the tax law, in relation to establishing a credit against  income  tax
  for  the rehabilitation of distressed commercial properties (Part GG);
  to amend the state finance law, in  relation  to  eligible  businesses
  participating  in  the  excelsior  linked  deposit  program and to the
  amount of funds available (Part HH); to amend the tax law, in relation
  to including community colleges as eligible  educational  institutions
  (Part  II);  to  amend the tax law, in relation to providing an income
  tax deduction for contributions made to farm  reserve  accounts  (Part
  JJ);  to  amend  the  tax  law, in relation to New York adjusted gross
  income of a resident individual  and  contributions  made  to  a  farm
  purchase  account  (Part KK); to amend the tax law, in relation to the
  unified credit against the estate tax (Part LL); to amend the tax law,
  in relation to establishing a natural resources improvement credit for
  farmlands and forestlands which may  be  taken  against  the  business
  franchise  tax and the personal income tax (Part MM); to amend the tax
  law, in relation to biofuel production credit for production of cellu-
  losic ethanol (Part NN); to amend the tax law, in relation to  tax  on

S. 2609--C                          3

  cigars  (Part  OO);  to  amend  the  tax  law,  in relation to tobacco
  products sold, shipped or delivered  within  state  and  the  taxation
  thereof  (Part PP); to amend the tax law, in relation to the qualified
  emerging technology company facilities, operations and training credit
  (Part  QQ); to amend the tax law, in relation to qualified transporta-
  tion fringe benefits (Part RR); to amend the tax law, in  relation  to
  providing  an  asbestos remediation tax credit (Part SS); to amend the
  tax law, in relation to providing an exemption from sales and  compen-
  sating  use  taxes  for  certain aircraft purchased in the state (Part
  TT); to amend the tax law, in relation to the sale of food and  bever-
  ages  through  vending machines (Part UU); to amend the public service
  law and the tax law, in relation to creating the clean  fuel  and  job
  creation  tax  credit  to incentivize power plants to repower existing
  facilities or construct new facilities which use cleaner burning fuels
  or add significant pollution control technologies (Part VV); 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 (Part WW); to amend the tax law, in relation to the imposition
  of the personal income tax upon foreign  partnerships  (Part  XX);  to
  amend  chapter  912  of the laws of 1920 relating to the regulation of
  boxing, sparring and wrestling, in relation to establishing  protocols
  for combative sports and authorizing mixed martial arts events in this
  state; to amend the tax law, in relation to the imposition of a tax on
  the  gross  receipts of any person holding any professional or amateur
  boxing, sparring or wrestling match  or  exhibition,  or  professional
  combative  sports match or exhibition; and providing for the repeal of
  such provisions upon expiration thereof (Part YY); to amend the  civil
  practice law and rules, in relation to the undertaking required during
  the  pendency of a stay of enforcement of a judgment against a partic-
  ipating or non-participating manufacturer under the master  settlement
  agreement  (Part  ZZ);  to amend the tax law, in relation to the fran-
  chise tax on business corporations (Part AAA); to amend the  tax  law,
  in  relation to increasing the presumed "cost of doing business by the
  agent" relating to cigarette sales (Part BBB); to amend the  tax  law,
  in relation to the gift for New York state teen health education fund;
  and  to  amend  the state finance law, in relation to establishing the
  New York state teen health education fund (Part CCC); to amend the tax
  law, in relation to information returns relating to payments  made  in
  settlement  of payment card and third party network transactions (Part
  DDD); to amend the tax law, in  relation  to  authorizing  advertising
  during quick draw and authorizing the gaming commission to sell adver-
  tising  space  on lottery tickets (Part EEE); to amend the tax law, in
  relation to video lottery gaming (Part FFF); and to  provide  for  the
  administration  of  certain  funds and accounts related to the 2013-14
  budget; authorizing certain payments and transfers; to  amend  chapter
  59  of  the  laws of 2012, relating to providing for administration of
  certain funds  and  accounts  related  to  the  2013-2014  budget,  in
  relation to the effectiveness thereof; to amend the state finance law,
  in relation to school tax relief fund; to amend chapter 60 of the laws
  of 2011, amending the state finance law relating to disbursements from
  the tribal-state compact revenue account to certain municipalities, in
  relation  to  the  availability of moneys; to amend the New York state
  medical care facilities finance agency act, in relation to the deposit
  of certain funds; to amend the state finance law, in relation  to  the
  issuance  of  revenue  bonds;  to amend the public authorities law, in
  relation to the number of directors required for approval of a  resol-

S. 2609--C                          4

  ution  authorizing  the  issuance  of bonds or notes; to amend the New
  York state urban development corporation act, in relation  to  funding
  project costs for certain capital projects; to amend chapter 61 of the
  laws  of 2005, relating to providing for the administration of certain
  funds and accounts related to the 2005-2006 budget, in relation to the
  Division of Military and Naval  Affairs  Capital  Projects;  to  amend
  chapter  389  of  the  laws  of 1997, relating to the financing of the
  correctional  facilities  improvement  fund  and  the  youth  facility
  improvement  fund,  in relation to the issuance of bonds; to amend the
  private housing finance law, in relation to housing program bonds  and
  notes;  to  amend  chapter 329 of the laws of 1991, amending the state
  finance law and other laws relating to the establishment of the  dedi-
  cated  highway  and  bridge trust fund, in relation to the issuance of
  bonds; to amend the public authorities law, in relation to  courthouse
  improvements  and  training  facilities,  metropolitan  transportation
  authority facilities, peace bridge projects and issuance of  bonds  by
  the  dormitory  authority;  to  amend  chapter 61 of the laws of 2005,
  providing for the administration of certain funds and accounts related
  to the 2005-2006 budget, in relation to issuance of bonds by the urban
  development corporation; to amend the New York state urban development
  corporation act, in relation to projects for retention of professional
  football in western New York; to amend the public authorities law,  in
  relation  to  the  cleaner,  greener communities program; to amend the
  state finance law, in relation to establishing the sales  tax  revenue
  bond  tax  fund  and  providing for the deposit of revenues therefrom,
  establishing the sales tax revenue bond financing  program;  to  amend
  the  tax  law,  in  relation to deposit and disposition of revenue; to
  amend the state finance law, in relation to establishing the New  York
  state  transformative  capital fund; to amend the New York state urban
  development corporation act, in  relation  to  authorizing  the  urban
  development  corporation  to issue bonds to fund project costs for the
  implementation of a NY-CUNY challenge grant program; to amend  chapter
  260  of  the  laws of 2011 amending the education law and the New York
  state urban  development  corporation  act  relating  to  establishing
  components of the NY-SUNY 2020 challenge grant program, in relation to
  the  effectiveness  thereof;  to  amend the public authorities law, in
  relation to dormitories at certain educational institutions other than
  state operated institutions and statutory or contract  colleges  under
  the jurisdiction of the state university of New York; to amend chapter
  81  of  the  laws of 2002, providing for the administration of certain
  funds and accounts related to the 2002-2003  budget,  in  relation  to
  increasing  the aggregate amount of bonds to be issued by the New York
  state urban development corporation; to amend the  public  authorities
  law, in relation to financing of New York works transportation capital
  projects;  and  providing  for  the  repeal of certain provisions upon
  expiration thereof (Part GGG)

  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 GGG. The effective date for each partic-
ular provision contained within such Part  is  set  forth  in  the  last

S. 2609--C                          5

section  of  such  Part. Any provision in any section contained within a
Part, including 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
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

S. 2609--C                          6

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
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

S. 2609--C                          7

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-
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,

S. 2609--C                          8

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
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

S. 2609--C                          9

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
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. 2609--C                         10

  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
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

S. 2609--C                         11

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. Study of the economic and fiscal effects of  the  film  tax
credit.  The  commissioner  of  economic  development shall commission a
study by an independent, unbiased third party to  examine  the  economic
and  fiscal effectiveness of the state film tax credit. This study shall
be comprehensive and shall include, but need not be limited to:
  (a) a comparison of the effectiveness of the film tax credit in gener-
ating short- and long-term economic activity versus other  business  tax
credits or rate reductions offered by the state;
  (b)  a  comparison  of the economic impact and the state and local tax
revenue impact of the film tax credit as between the following areas (i)
within the city of New  York,  (ii)  within  the  metropolitan  commuter
transportation  district outside the city of New York, and (iii) outside
of the metropolitan commuter transportation district; and
  (c) a review of the direct and indirect economic impact and the  state
and local tax revenue impact of the film industry (i) within the city of
New  York, (ii) within the metropolitan commuter transportation district
outside the city of New York, and  (iii)  outside  of  the  metropolitan
commuter transportation district.
  S  2.  Paragraph 2 of subdivision (a) of section 24 of the tax law, as
amended by section 4 of part Q of chapter 57 of the  laws  of  2010,  is
amended to read as follows:
  (2)  The  amount  of  the  credit  shall  be  the [product] SUM OF THE
PRODUCTS (or pro rata share of the product, in the case of a member of a
partnership) of: (I) thirty percent [and] FOR the  qualified  production
costs paid or incurred in THE COUNTIES OF BRONX, KINGS, NEW YORK, QUEENS
OR   RICHMOND  DURING  the  production  of  a  qualified  film[,];  (II)
THIRTY-FIVE PERCENT FOR THE QUALIFIED PRODUCTION COSTS PAID OR  INCURRED
IN  THE COUNTIES OF DUTCHESS, NASSAU, ORANGE, PUTNAM, ROCKLAND, SUFFOLK,
SULLIVAN, ULSTER OR WESTCHESTER, DURING THE PRODUCTION  OF  A  QUALIFIED

S. 2609--C                         12

FILM;  (III)  FORTY  PERCENT  FOR THE QUALIFIED PRODUCTION COSTS PAID OR
INCURRED IN ALL COUNTIES NOT REFERENCED IN SUBPARAGRAPH (I) OR  (II)  OF
THIS PARAGRAPH DURING THE PRODUCTION OF A QUALIFIED FILM; provided that:
[(i)]  (1)  the  qualified  production  costs (excluding post production
costs) paid or incurred which are attributable to the  use  of  tangible
property  or  the performance of services at a qualified film production
facility in the production of such qualified film equal or exceed seven-
ty-five percent of  the  production  costs  (excluding  post  production
costs)  paid  or  incurred which are attributable to the use of tangible
property or the performance of services at any film production  facility
within  and  without  the  state  in  the  production  of such qualified
film[,]; and [(ii)] (2) except with respect to a  qualified  independent
film  production  company  or  pilot,  at least ten percent of the total
principal photography shooting days spent  in  the  production  of  such
qualified  film  must  be spent at a qualified film production facility.
However, if the qualified production costs  (excluding  post  production
costs)  which  are  attributable  to the use of tangible property or the
performance of services at a qualified film production facility  in  the
production  of  such  qualified film is less than three million dollars,
then the portion of the qualified production costs attributable  to  the
use  of  tangible  property  or  the  performance  of  services  in  the
production of such qualified film outside of a qualified film production
facility shall be allowed only if the shooting days spent  in  New  York
outside  of  a film production facility in the production of such quali-
fied film equal or exceed seventy-five percent  of  the  total  shooting
days  spent  within  and  without  New York outside of a film production
facility in the production of such qualified film. The credit  shall  be
allowed  for  the taxable year in which the production of such qualified
film is completed. However,  in  the  case  of  a  qualified  film  that
receives funds from additional pool 2, no credit shall be claimed before
the  later of [(1)] (A) the taxable year the production of the qualified
film is complete, or [(2)] (B) 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. 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 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 cred-
it  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  3.  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,

S. 2609--C                         13

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
(reporting of books, films,  etc.  with  respect  to  sexually  explicit
conduct).
  S 4. 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  5.  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
SIXTEEN provided however, seven million dollars of the annual allocation
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 ARTICLE IN EACH
YEAR  STARTING  IN  TWO  THOUSAND  FIFTEEN THROUGH TWO THOUSAND SIXTEEN.
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

S. 2609--C                         14

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
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 6. 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  7.  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  QUALIFIED  POST  PRODUCTION  FACILITY,  WHICHEVER  IS LESS. (III) A
TAXPAYER MAY CLAIM A CREDIT FOR QUALIFIED POST PRODUCTION COSTS  EXCLUD-
ING  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 SATIS-
FIED.  The  credit  shall  be  allowed for the taxable year in which the
production of such qualified film is completed.
  S 8. 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:

S. 2609--C                         15

  (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
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 9. 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, (D) THE
CREDIT-ELIGIBLE MAN HOURS FOR EACH PROJECT; AND (E) TOTAL WAGES FOR SUCH
CREDIT-ELIGIBLE MAN HOURS FOR EACH PROJECT; AND
  (6)(A) THE NAME OF EACH TAXPAYER  ALLOCATED  A  TAX  CREDIT  FOR  EACH
PROJECT AND THE COUNTY OF RESIDENCE OR INCORPORATION OF SUCH TAXPAYER OR
IF  THE TAXPAYER DOES NOT RESIDE OR IS NOT INCORPORATED IN NEW YORK THEN
THE STATE; 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

S. 2609--C                         16

  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
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 10. This act shall take effect immediately, provided, however,  that
sections  six,  seven  and  nine  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  application  to the governor's office of motion picture and tele-
vision development on or before the date this act shall  have  become  a
law.

                                 PART C

  Intentionally omitted.

                                 PART D

  Intentionally omitted.

                                 PART E

  Intentionally omitted.

                                 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 TEN AND BEFORE JANUARY FIRST,  TWO  THOUSAND
THIRTEEN,  THE CREDIT SHALL NOT EXCEED FIVE MILLION DOLLARS; FOR TAXABLE
YEARS BEGINNING ON OR AFTER JANUARY FIRST,  TWO  THOUSAND  THIRTEEN  AND

S. 2609--C                         17

BEFORE JANUARY FIRST, TWO THOUSAND FOURTEEN, THE CREDIT SHALL NOT EXCEED
SEVEN  MILLION  DOLLARS; FOR TAXABLE YEARS BEGINNING ON OR AFTER JANUARY
FIRST, TWO THOUSAND FOURTEEN AND  BEFORE  JANUARY  FIRST,  TWO  THOUSAND
FIFTEEN,  THE  CREDIT SHALL NOT EXCEED NINE MILLION DOLLARS; FOR TAXABLE
YEARS BEGINNING ON OR AFTER JANUARY FIRST,  TWO  THOUSAND  FIFTEEN,  THE
CREDIT  SHALL  NOT  EXCEED  TWELVE  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.
  (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 ON JANUARY FIRST OF EACH  YEAR
USING  THE  MOST  RECENT  FIVE YEAR ESTIMATE FROM THE AMERICAN COMMUNITY
SURVEY PUBLISHED BY THE UNITED STATES CENSUS BUREAU.
  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 TEN AND BEFORE JANUARY FIRST,  TWO  THOUSAND
THIRTEEN,  THE CREDIT SHALL NOT EXCEED FIVE MILLION DOLLARS; FOR TAXABLE
YEARS BEGINNING ON OR AFTER JANUARY FIRST,  TWO  THOUSAND  THIRTEEN  AND
BEFORE JANUARY FIRST, TWO THOUSAND FOURTEEN, THE CREDIT SHALL NOT EXCEED
SEVEN  MILLION  DOLLARS; FOR TAXABLE YEARS BEGINNING ON OR AFTER JANUARY
FIRST, TWO THOUSAND FOURTEEN AND  BEFORE  JANUARY  FIRST,  TWO  THOUSAND
FIFTEEN,  THE  CREDIT SHALL NOT EXCEED NINE MILLION DOLLARS; FOR TAXABLE
YEARS BEGINNING ON OR AFTER JANUARY FIRST,  TWO  THOUSAND  FIFTEEN,  THE
CREDIT  SHALL  NOT  EXCEED  TWELVE  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

S. 2609--C                         18

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
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 TEN AND BEFORE JANUARY FIRST,  TWO  THOUSAND
THIRTEEN,  THE CREDIT SHALL NOT EXCEED FIVE MILLION DOLLARS; FOR TAXABLE
YEARS BEGINNING ON OR AFTER JANUARY FIRST,  TWO  THOUSAND  THIRTEEN  AND
BEFORE JANUARY FIRST, TWO THOUSAND FOURTEEN, THE CREDIT SHALL NOT EXCEED
SEVEN  MILLION  DOLLARS; FOR TAXABLE YEARS BEGINNING ON OR AFTER JANUARY
FIRST, TWO THOUSAND FOURTEEN AND  BEFORE  JANUARY  FIRST,  TWO  THOUSAND
FIFTEEN,  THE  CREDIT SHALL NOT EXCEED NINE MILLION DOLLARS; FOR TAXABLE
YEARS BEGINNING ON OR AFTER JANUARY FIRST,  TWO  THOUSAND  FIFTEEN,  THE
CREDIT  SHALL  NOT  EXCEED  TWELVE  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.

S. 2609--C                         19

  (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 TEN AND BEFORE JANUARY FIRST, TWO THOUSAND
THIRTEEN, THE CREDIT SHALL NOT EXCEED FIVE MILLION DOLLARS; FOR  TAXABLE
YEARS  BEGINNING  ON  OR  AFTER JANUARY FIRST, TWO THOUSAND THIRTEEN AND
BEFORE JANUARY FIRST, TWO THOUSAND FOURTEEN, THE CREDIT SHALL NOT EXCEED
SEVEN MILLION DOLLARS; FOR TAXABLE YEARS BEGINNING ON OR  AFTER  JANUARY
FIRST,  TWO  THOUSAND  FOURTEEN  AND  BEFORE JANUARY FIRST, TWO THOUSAND
FIFTEEN, THE CREDIT SHALL NOT EXCEED NINE MILLION DOLLARS;  FOR  TAXABLE
YEARS  BEGINNING  ON  OR  AFTER JANUARY FIRST, TWO THOUSAND FIFTEEN, THE
CREDIT SHALL NOT EXCEED TWELVE  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
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-

S. 2609--C                         20

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] AND ELECTRIC VEHICLE RECHARGING
PROPERTY 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 AND 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  AND  ELECTRIC  VEHICLE
RECHARGING PROPERTY.  The credit under this section for alternative fuel
vehicle  refueling  AND 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

S. 2609--C                         21

defined in subparagraph (B) of paragraph  three  of  subsection  (p)  of
section  six  hundred six of this chapter] WHICH CONSTITUTES ALTERNATIVE
FUEL VEHICLE REFUELING PROPERTY OR 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 prop-
erty"  MEANS  ALL  OF THE EQUIPMENT NEEDED TO DISPENSE ANY FUEL AT LEAST
EIGHTY-FIVE PERCENT OF THE VOLUME OF WHICH CONSISTS OF ONE  OR  MORE  OF
THE  FOLLOWING:  NATURAL  GAS, COMPRESSED NATURAL GAS, LIQUIFIED NATURAL
GAS, LIQUIFIED PETROLEUM, OR HYDROGEN.
  (B) THE TERM "ELECTRIC VEHICLE RECHARGING PROPERTY"  means  [any  such
property  which  is  qualified within the meaning of section thirty C of
the internal revenue code, but shall not include alternative fuel  vehi-
cle  refueling  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 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  OR 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 OR 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] ALTERNATIVE FUEL VEHICLE REFUEL-
ING PROPERTY OR ELECTRIC VEHICLE RECHARGING PROPERTY; 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. 2609--C                         22

  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:
  24. Alternative fuels AND 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 alter-
native fuel vehicle refueling AND ELECTRIC VEHICLE  RECHARGING  property
placed in service during the taxable year.
  (b)  Alternative  fuel vehicle refueling property AND ELECTRIC VEHICLE
RECHARGING PROPERTY.  The credit under this subdivision for  alternative
fuel  vehicle  refueling  AND 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 CONSTITUTES ALTERNATIVE FUEL  VEHICLE
REFUELING PROPERTY OR ELECTRIC VEHICLE RECHARGING PROPERTY; 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.  (I)  The  term  "alternative fuel vehicle refueling
property" MEANS ALL OF THE EQUIPMENT NEEDED  TO  DISPENSE  ANY  FUEL  AT
LEAST EIGHTY-FIVE PERCENT OF THE VOLUME OF WHICH CONSISTS OF ONE OR MORE
OF THE FOLLOWING: NATURAL GAS, COMPRESSED NATURAL GAS, LIQUIFIED NATURAL
GAS, LIQUIFIED PETROLEUM, OR HYDROGEN.
  (II)  THE  TERM "ELECTRIC VEHICLE RECHARGING PROPERTY" means [any such
property 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 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 OR 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 OR 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] ALTERNATIVE FUEL VEHICLE REFUEL-
ING PROPERTY OR ELECTRIC VEHICLE RECHARGING PROPERTY; 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

S. 2609--C                         23

  (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
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)] Termination. The credit allowed by paragraph (b) of this subdivi-
sion  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 AND 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 AND ELECTRIC VEHICLE RECHARGING prop-
erty placed in service during the taxable year.
  (2)  Alternative  fuel vehicle refueling property AND ELECTRIC VEHICLE
RECHARGING PROPERTY.  The credit under this subsection  for  [clean-fuel
vehicle  refueling] ALTERNATIVE FUEL VEHICLE REFUELING PROPERTY OR ELEC-
TRIC 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

S. 2609--C                         24

  (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
CONSTITUTES  ALTERNATIVE  FUEL  VEHICLE  REFUELING  PROPERTY OR 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"  MEANS  ALL  OF  THE  EQUIPMENT NEEDED TO DISPENSE ANY FUEL AT
LEAST EIGHTY-FIVE PERCENT OF THE VOLUME OF WHICH CONSISTS OF ONE OR MORE
OF THE FOLLOWING: NATURAL GAS, COMPRESSED NATURAL GAS, LIQUIFIED NATURAL
GAS, LIQUIFIED PETROLEUM, OR HYDROGEN; AND
  (B) THE TERM "ELECTRIC VEHICLE RECHARGING PROPERTY"  means  [any  such
property  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, ALTERNATIVE FUEL VEHICLE REFUELING PROPERTY
OR ELECTRIC VEHICLE RECHARGING PROPERTY ceases to be qualified, a recap-
ture 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.

S. 2609--C                         25

  (ii)  Cessation of qualification. Clean-fuel vehicle refueling] ALTER-
NATIVE FUEL VEHICLE REFUELING PROPERTY OR  ELECTRIC  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] ALTERNATIVE FUEL  VEHICLE
REFUELING PROPERTY OR ELECTRIC VEHICLE RECHARGING 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.
  [(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
AND 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

  Intentionally omitted.

                                 PART I

  Intentionally omitted.

                                 PART J

  Intentionally omitted.

                                 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

S. 2609--C                         26

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-b of the tax law is amended  by  adding  a  new
subdivision (j) to read as follows:
  (J)  EXEMPTION  FOR  MOTOR  FUEL  AND DIESEL MOTOR FUEL. EXEMPTION 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  VOLUNTEER  RESCUE  SQUAD
SUPPORTED IN WHOLE OR IN PART BY TAX MONIES, WHERE ANY  SUCH  ENTITY  IS
THE  PURCHASER, USED 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 EXEMPTION FROM THE
TAX IMPOSED PURSUANT TO THIS ARTICLE. PROVIDED,  THAT  THE  COMMISSIONER
SHALL  REQUIRE  SUCH  DOCUMENTARY  PROOF  TO  QUALITY  FOR ANY EXEMPTION
PROVIDED HEREUNDER AS THE COMMISSION 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

  Intentionally omitted.

                                 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 CLAUSE (I) 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 CHAP-
TER 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 APPLICATION 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

S. 2609--C                         27

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
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  appli-
cation 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

S. 2609--C                         28

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
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

  Intentionally omitted.

                                 PART Q

  Intentionally omitted.

                                 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
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.

S. 2609--C                         29

  (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
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. 2609--C                         30

  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
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

S. 2609--C                         31

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
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

S. 2609--C                         32

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:
  (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;

S. 2609--C                         33

  (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,  WHICH  shall  be  as
prescribed  by  regulations  promulgated  and  adopted  by the division,
provided however, that such rules shall provide that no person under the
age of twenty-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 emer-
gency basis not later than ninety days after the enactment of this para-
graph 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.
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-

S. 2609--C                         34

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]   FOURTEEN;
provided,  however, that any party to such agreement may elect to termi-
nate such agreement upon conveying written notice to all  other  parties
of  such  agreement 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] FOURTEEN; 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] FOURTEEN, 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
determined by comparing the total commissions available after July twen-
ty-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.  The  opening  paragraph of subdivision 1 of section 1014 of the
racing, pari-mutuel wagering and breeding law, as amended by  section  3
of  part  O  of  chapter  59  of the laws of 2012, is amended to read as
follows:

S. 2609--C                         35

  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 conducting a race meet-
ing in Saratoga county at Saratoga  thoroughbred  racetrack  until  June
thirtieth, two thousand [thirteen] FOURTEEN and on any day regardless of
whether  or not a franchised corporation is conducting a race meeting in
Saratoga county at Saratoga thoroughbred racetrack after June thirtieth,
two thousand [thirteen] FOURTEEN. On  any  day  on  which  a  franchised
corporation has not scheduled a racing program but a thoroughbred racing
corporation  located  within  the state is conducting racing, every off-
track betting corporation branch office and every simulcasting  facility
licensed  in  accordance  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 simulcast signal from thoroughbred tracks
located in another state or foreign country  subject  to  the  following
provisions:
  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 July first, nineteen hundred ninety-four through June
thirtieth, two thousand [thirteen] FOURTEEN.  This section shall  super-
sede 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] FOURTEEN.   Every off-track betting
corporation branch office and every simulcasting  facility  licensed  in
accordance  with  section  one  thousand  seven that have entered into a
written agreement with such facility's representative horsemen's  organ-
ization  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
July twenty-fifth, two thousand one through September eighth, two  thou-
sand  [twelve]  FOURTEEN,  when a franchised corporation is conducting 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

S. 2609--C                         36

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]  2014;  provided,  however,  that  nothing
contained  herein  shall be deemed to affect the application, qualifica-
tion, expiration, 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 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 breed-
ing law, as added by section thirty-eight of this act, shall expire  and
be  deemed repealed on July 1, [2013] 2014; 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"

S. 2609--C                         37

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
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 April first, two thousand one
through December thirty-first, two thousand  [thirteen]  FOURTEEN,  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  April
first,  two  thousand  one  through  December thirty-first, two thousand
[thirteen] FOURTEEN, 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, as amended by section 10 of part O of  chapter  59
of the laws of 2012, is amended to read as follows:
  5.  The  provisions  of this section shall expire and be of no further
force and effect after June thirtieth, two thousand [thirteen] FOURTEEN.
  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] TWEN-

S. 2609--C                         38

TY-ONE and twenty-five thousand dollars for taxable years  beginning  on
or  after January first, two thousand [fifteen] TWENTY-ONE.  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  residence  in the same year, the total amount of credit
allowed under paragraph 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-ONE and twenty-five thousand dollars for taxa-
ble years beginning on or after January first,  two  thousand  [fifteen]
TWENTY-ONE.
  (B)  For  taxable years beginning on or after January first, two thou-
sand ten and before January first, two thousand [fifteen] TWENTY-ONE, 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
for  such year or years. For taxable years beginning on or after January
first, two thousand [fifteen] TWENTY-ONE, if the amount of credit allow-
able 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

S. 2609--C                         39

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
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

S. 2609--C                         40

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
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:

S. 2609--C                         41

  (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.
  [(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

S. 2609--C                         42

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
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

S. 2609--C                         43

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,
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;

S. 2609--C                         44

  (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.

                                 PART Y

  Section 1. Subsection (a) of section 616 of the tax law, as amended by
chapter 28 of the laws of 1987, is amended to read as follows:
  (a) General. For taxable years beginning after nineteen hundred eight-
y-seven,  a resident individual shall be allowed a New York exemption of
one thousand dollars for each exemption for which he OR SHE is  entitled
to  a  deduction  for  the taxable year under section one hundred fifty-
one(c) of the Internal Revenue Code; and for taxable years beginning  in
nineteen  hundred  eighty-seven,  a  resident  individual  other  than a
taxpayer whose federal exemption amount is zero shall be allowed  a  New
York  exemption  of nine hundred dollars for each exemption for which he
OR SHE is entitled to a deduction  for  the  taxable  year  for  federal
income  tax  purposes;  FOR  TAXABLE  YEARS BEGINNING AFTER TWO THOUSAND
TWELVE, A RESIDENT INDIVIDUAL SHALL BE ALLOWED A NEW YORK  EXEMPTION  OF
ONE THOUSAND TWO HUNDRED FIFTY-FIVE DOLLARS FOR EACH EXEMPTION FOR WHICH
HE  OR SHE IS ENTITLED TO A DEDUCTION FOR THE TAXABLE YEAR UNDER SECTION
ONE HUNDRED FIFTY-ONE(C) OF THE INTERNAL REVENUE CODE; FOR TAXABLE YEARS
BEGINNING AFTER TWO THOUSAND THIRTEEN, A RESIDENT  INDIVIDUAL  SHALL  BE
ALLOWED  A  NEW  YORK EXEMPTION OF ONE THOUSAND FIVE HUNDRED TEN DOLLARS
FOR EACH EXEMPTION FOR WHICH HE OR SHE IS ENTITLED TO  A  DEDUCTION  FOR
THE  TAXABLE YEAR UNDER SECTION ONE HUNDRED FIFTY-ONE(C) OF THE INTERNAL
REVENUE CODE; FOR TAXABLE YEARS BEGINNING AFTER TWO THOUSAND FOURTEEN, A
RESIDENT INDIVIDUAL SHALL BE ALLOWED A NEW YORK EXEMPTION OF  ONE  THOU-
SAND SEVEN HUNDRED SIXTY-FIVE DOLLARS FOR EACH EXEMPTION FOR WHICH HE OR
SHE  IS  ENTITLED  TO A DEDUCTION FOR THE TAXABLE YEAR UNDER SECTION ONE
HUNDRED FIFTY-ONE(C) OF THE INTERNAL REVENUE CODE; AND FOR TAXABLE YEARS
BEGINNING AFTER TWO THOUSAND FIFTEEN, A  RESIDENT  INDIVIDUAL  SHALL  BE
ALLOWED  A  NEW  YORK  EXEMPTION OF TWO THOUSAND TWENTY DOLLARS FOR EACH
EXEMPTION FOR WHICH HE OR SHE IS ENTITLED TO A DEDUCTION FOR THE TAXABLE
YEAR UNDER SECTION ONE HUNDRED  FIFTY-ONE(C)  OF  THE  INTERNAL  REVENUE
CODE.
  S  2. Section 606 of the tax law is amended by adding a new subsection
(ww) to read as follows:
  (WW) ADDITIONAL  CREDIT  FOR  CERTAIN  HOUSEHOLD  AND  DEPENDENT  CARE
SERVICES.  (1) A RESIDENT TAXPAYER SHALL BE ALLOWED A CREDIT AS PROVIDED
HEREIN EQUAL TO THE DIFFERENCE BETWEEN THE INFLATION INDEX AS CALCULATED
UNDER PARAGRAPH TWO OF THIS SUBSECTION AND THE CREDIT ALLOWABLE PURSUANT
TO SUBSECTION (C) OF THIS SECTION.

S. 2609--C                         45

  (2) THE INFLATION INDEX SHALL BE EQUAL TO THE APPLICABLE PERCENTAGE OF
THE  CREDIT  ALLOWABLE  UNDER SECTION TWENTY-ONE OF THE INTERNAL REVENUE
CODE FOR THE SAME TAXABLE YEAR (WITHOUT REGARD TO WHETHER  THE  TAXPAYER
IN  FACT CLAIMED THE CREDIT UNDER SUCH SECTION TWENTY-ONE FOR SUCH TAXA-
BLE  YEAR).   FOR TAXABLE YEARS BEGINNING AFTER TWO THOUSAND TWELVE, THE
APPLICABLE  PERCENTAGE  SHALL  BE  THE  SUM  OF   (I)   TWENTY-ONE   AND
EIGHT-TENTHS PERCENT AND (II) A MULTIPLIER MULTIPLIED BY A FRACTION. THE
NUMERATOR  OF  SUCH FRACTION SHALL BE THE LESSER OF (I) FIFTEEN THOUSAND
DOLLARS OR (II) SEVENTY-ONE THOUSAND TWO HUNDRED FIFTY DOLLARS LESS  THE
NEW  YORK ADJUSTED GROSS INCOME FOR THE TAXABLE YEAR, PROVIDED, HOWEVER,
THE NUMERATOR SHALL NOT BE LESS THAN ZERO.    THE  DENOMINATOR  OF  SUCH
FRACTION  SHALL  BE  FIFTEEN  THOUSAND  DOLLARS. THE MULTIPLIER SHALL BE
SEVENTY-EIGHT AND TWO-TENTHS PERCENT. PROVIDED, HOWEVER,  FOR  A  PERSON
WHOSE  NEW  YORK ADJUSTED GROSS INCOME IS LESS THAN FORTY-THREE THOUSAND
SEVEN HUNDRED FIFTY DOLLARS, SUCH APPLICABLE PERCENTAGE SHALL  BE  EQUAL
TO  (I)  ONE  HUNDRED  PERCENT, PLUS (II) TWENTY PERCENT MULTIPLIED BY A
FRACTION WHOSE NUMERATOR SHALL BE THE LESSER  OF  (I)  FIFTEEN  THOUSAND
DOLLARS  OR  (II)  FORTY-THREE THOUSAND SEVEN HUNDRED FIFTY DOLLARS LESS
THE NEW YORK ADJUSTED GROSS INCOME FOR THE TAXABLE YEAR,  PROVIDED  SUCH
NUMERATOR  SHALL  NOT  BE LESS THAN ZERO, AND WHOSE DENOMINATOR SHALL BE
FIFTEEN THOUSAND DOLLARS.  FOR TAXABLE YEARS BEGINNING AFTER  TWO  THOU-
SAND  THIRTEEN,  THE APPLICABLE PERCENTAGE SHALL BE THE SUM OF (I) TWEN-
TY-THREE AND SIX-TENTHS PERCENT AND (II) A MULTIPLIER  MULTIPLIED  BY  A
FRACTION.  THE  NUMERATOR  OF  SUCH  FRACTION SHALL BE THE LESSER OF (I)
FIFTEEN THOUSAND DOLLARS OR (II)  SEVENTY-EIGHT  THOUSAND  FIVE  HUNDRED
DOLLARS  LESS  THE  NEW YORK ADJUSTED GROSS INCOME FOR THE TAXABLE YEAR,
PROVIDED, HOWEVER, THE NUMERATOR SHALL NOT BE LESS THAN ZERO. THE DENOM-
INATOR OF SUCH FRACTION SHALL BE FIFTEEN THOUSAND DOLLARS. THE MULTIPLI-
ER SHALL BE SEVENTY-SIX AND FOUR-TENTHS PERCENT. PROVIDED, HOWEVER,  FOR
A  PERSON  WHOSE NEW YORK ADJUSTED GROSS INCOME IS LESS THAN FORTY-SEVEN
THOUSAND FIVE HUNDRED DOLLARS, SUCH APPLICABLE PERCENTAGE SHALL BE EQUAL
TO (I) ONE HUNDRED PERCENT, PLUS (II) THIRTY  PERCENT  MULTIPLIED  BY  A
FRACTION  WHOSE  NUMERATOR  SHALL  BE THE LESSER OF (I) FIFTEEN THOUSAND
DOLLARS OR (II) FORTY-SEVEN THOUSAND FIVE HUNDRED DOLLARS LESS  THE  NEW
YORK ADJUSTED GROSS INCOME FOR THE TAXABLE YEAR, PROVIDED SUCH NUMERATOR
SHALL  NOT  BE  LESS  THAN  ZERO, AND WHOSE DENOMINATOR SHALL BE FIFTEEN
THOUSAND DOLLARS.  FOR TAXABLE YEARS BEGINNING AFTER TWO THOUSAND  FOUR-
TEEN,  THE APPLICABLE PERCENTAGE SHALL BE THE SUM OF (I) TWENTY-FIVE AND
FOUR-TENTHS PERCENT AND (II) A MULTIPLIER MULTIPLIED BY A FRACTION.  THE
NUMERATOR OF SUCH FRACTION SHALL BE THE LESSER OF (I)  FIFTEEN  THOUSAND
DOLLARS  OR  (II)  EIGHTY-FOUR THOUSAND SEVEN HUNDRED FIFTY DOLLARS LESS
THE NEW YORK ADJUSTED GROSS  INCOME  FOR  THE  TAXABLE  YEAR,  PROVIDED,
HOWEVER,  THE  NUMERATOR SHALL NOT BE LESS THAN ZERO. THE DENOMINATOR OF
SUCH FRACTION SHALL BE FIFTEEN THOUSAND DOLLARS. THE MULTIPLIER SHALL BE
SEVENTY-FOUR AND SIX-TENTHS PERCENT. PROVIDED,  HOWEVER,  FOR  A  PERSON
WHOSE NEW YORK ADJUSTED GROSS INCOME IS LESS THAN FIFTY-ONE THOUSAND TWO
HUNDRED  FIFTY DOLLARS, SUCH APPLICABLE PERCENTAGE SHALL BE EQUAL TO (I)
ONE HUNDRED PERCENT, PLUS (II) FORTY PERCENT MULTIPLIED  BY  A  FRACTION
WHOSE  NUMERATOR  SHALL BE THE LESSER OF (I) FIFTEEN THOUSAND DOLLARS OR
(II) FIFTY-ONE THOUSAND TWO HUNDRED FIFTY  DOLLARS  LESS  THE  NEW  YORK
ADJUSTED  GROSS  INCOME  FOR  THE  TAXABLE YEAR, PROVIDED SUCH NUMERATOR
SHALL NOT BE LESS THAN ZERO, AND  WHOSE  DENOMINATOR  SHALL  BE  FIFTEEN
THOUSAND  DOLLARS.    FOR  TAXABLE  YEARS  BEGINNING  AFTER TWO THOUSAND
FIFTEEN, THE APPLICABLE PERCENTAGE SHALL BE THE SUM OF (I)  TWENTY-SEVEN
AND  FIVE-TENTHS PERCENT AND (II) A MULTIPLIER MULTIPLIED BY A FRACTION.
THE NUMERATOR OF SUCH FRACTION SHALL BE THE LESSER OF (I) FIFTEEN  THOU-

S. 2609--C                         46

SAND  DOLLARS OR (II) NINETY THOUSAND DOLLARS LESS THE NEW YORK ADJUSTED
GROSS INCOME FOR THE TAXABLE  YEAR,  PROVIDED,  HOWEVER,  THE  NUMERATOR
SHALL  NOT  BE LESS THAN ZERO. THE DENOMINATOR OF SUCH FRACTION SHALL BE
FIFTEEN  THOUSAND DOLLARS. THE MULTIPLIER SHALL BE SEVENTY-TWO AND FIVE-
TENTHS PERCENT. PROVIDED, HOWEVER, FOR A PERSON WHOSE NEW YORK  ADJUSTED
GROSS  INCOME  IS LESS THAN FIFTY-FIVE THOUSAND DOLLARS, SUCH APPLICABLE
PERCENTAGE SHALL BE EQUAL TO (I) ONE HUNDRED PERCENT,  PLUS  (II)  FIFTY
PERCENT  MULTIPLIED BY A FRACTION WHOSE NUMERATOR SHALL BE THE LESSER OF
(I) FIFTEEN THOUSAND DOLLARS OR (II) FIFTY-FIVE  THOUSAND  DOLLARS  LESS
THE  NEW  YORK ADJUSTED GROSS INCOME FOR THE TAXABLE YEAR, PROVIDED SUCH
NUMERATOR SHALL NOT BE LESS THAN ZERO, AND WHOSE  DENOMINATOR  SHALL  BE
FIFTEEN THOUSAND DOLLARS.
  (3)  THE  CREDIT  UNDER  THIS  SUBSECTION SHALL BE ALLOWED AGAINST THE
TAXES IMPOSED BY THIS ARTICLE FOR THE TAXABLE YEAR REDUCED BY THE  CRED-
ITS PERMITTED BY THIS ARTICLE. THE AMOUNT OF THE CREDIT SHALL NOT EXCEED
THE  TAX  DETERMINED  UNDER  SUBSECTIONS  (A) THROUGH (D) OF SECTION SIX
HUNDRED ONE OF THIS PART FOR THE TAXABLE YEAR  REDUCED  BY  THE  CREDITS
PERMITTED  UNDER  SECTIONS SIX HUNDRED TWENTY AND SIX HUNDRED TWENTY-ONE
OF THIS ARTICLE.
  (4) IN THE CASE OF A HUSBAND AND WIFE WHO FILE A JOINT FEDERAL RETURN,
BUT WHO ARE REQUIRED TO DETERMINE THEIR NEW YORK TAXES  SEPARATELY,  THE
CREDIT  ALLOWED  PURSUANT TO THIS SUBSECTION MAY ONLY BE APPLIED AGAINST
THE TAX IMPOSED ON THE SPOUSE WITH THE LOWER  TAXABLE  INCOME,  COMPUTED
WITHOUT REGARD TO SUCH CREDIT. IN THE CASE OF A HUSBAND AND WIFE WHO ARE
NOT  REQUIRED TO FILE A FEDERAL RETURN, THE CREDIT UNDER THIS SUBSECTION
SHALL BE ALLOWED ONLY IF SUCH TAXPAYERS FILE A JOINT NEW YORK INCOME TAX
RETURN.
  S 3. Section 606 of the tax law is amended by adding a new  subsection
(xx) to read as follows:
  (XX)  ADDITIONAL  EMPIRE  STATE  CHILD CREDIT. (1) A RESIDENT TAXPAYER
SHALL BE ALLOWED A CREDIT AS PROVIDED HEREIN, EQUAL  TO  THE  APPLICABLE
PERCENTAGE  OF  THE  CHILD TAX CREDIT ALLOWED THE TAXPAYER UNDER SECTION
TWENTY-FOUR OF THE INTERNAL REVENUE CODE FOR THE SAME TAXABLE  YEAR  FOR
EACH  QUALIFYING  CHILD.  PROVIDED,  HOWEVER,  IN THE CASE OF A TAXPAYER
WHOSE FEDERAL ADJUSTED GROSS INCOME  EXCEEDS  THE  APPLICABLE  THRESHOLD
AMOUNT  SET FORTH BY PARAGRAPH TWO OF SUBDIVISION (B) OF SECTION TWENTY-
FOUR OF THE INTERNAL REVENUE CODE, THE APPLICABLE PERCENTAGE SHALL APPLY
TO THE CHILD TAX CREDIT ALLOWED THE TAXPAYER UNDER  SECTION  TWENTY-FOUR
OF THE INTERNAL REVENUE CODE FOR EACH QUALIFYING CHILD. FOR THE PURPOSES
OF  THIS  SUBSECTION,  A QUALIFYING CHILD SHALL BE A CHILD WHO MEETS THE
DEFINITION  OF  QUALIFIED  CHILD  UNDER  SUBDIVISION  (C)   OF   SECTION
TWENTY-FOUR  OF  THE INTERNAL REVENUE CODE AND IS AT LEAST FOUR YEARS OF
AGE. THE APPLICABLE PERCENTAGE SHALL BE AS FOLLOWS:  FOR  TAXABLE  YEARS
BEGINNING  AFTER  TWO  THOUSAND  TWELVE,  ONE AND ONE TENTH PERCENT, FOR
TAXABLE YEARS BEGINNING AFTER TWO THOUSAND THIRTEEN, TWO AND TWO  TENTHS
PERCENT,  FOR TAXABLE YEARS BEGINNING AFTER TWO THOUSAND FOURTEEN, THREE
AND THREE TENTHS PERCENT, FOR TAXABLE YEARS BEGINNING AFTER TWO THOUSAND
FIFTEEN, FOUR AND FIVE TENTHS PERCENT.
  (2) THE CREDIT UNDER THIS SUBSECTION  SHALL  BE  ALLOWED  AGAINST  THE
TAXES  IMPOSED BY THIS ARTICLE FOR THE TAXABLE YEAR REDUCED BY THE CRED-
ITS PERMITTED BY THIS ARTICLE. THE AMOUNT OF THE CREDIT SHALL NOT EXCEED
THE TAX DETERMINED UNDER SUBSECTIONS (A)  THROUGH  (D)  OF  SECTION  SIX
HUNDRED  ONE  OF  THIS  PART FOR THE TAXABLE YEAR REDUCED BY THE CREDITS
PERMITTED UNDER SECTIONS SIX HUNDRED TWENTY AND SIX  HUNDRED  TWENTY-ONE
OF THIS ARTICLE.

S. 2609--C                         47

  (3) IN THE CASE OF A HUSBAND AND WIFE WHO FILE A JOINT FEDERAL RETURN,
BUT  WHO  ARE REQUIRED TO DETERMINE THEIR NEW YORK TAXES SEPARATELY, THE
CREDIT ALLOWED PURSUANT TO THIS SUBSECTION MAY BE  APPLIED  AGAINST  THE
TAX IMPOSED ON EITHER OR DIVIDED BETWEEN THEM AS THEY MAY ELECT.
  S  4. Section 606 of the tax law is amended by adding a new subsection
(aaa) to read as follows:
  (AAA) SUPPLEMENTAL CHILD TAX CREDIT. (1) A RESIDENT TAXPAYER WHO HAS A
CHILD WHO MEETS THE DEFINITION OF A QUALIFIED  CHILD  UNDER  SUBDIVISION
(C)  OF SECTION TWENTY-FOUR OF THE INTERNAL REVENUE CODE AND IS AT LEAST
FOUR YEARS OF AGE SHALL BE ALLOWED A  CREDIT  AS  FOLLOWS:  FOR  TAXABLE
YEARS  BEGINNING  AFTER  TWO  THOUSAND  TWELVE,  ONE HUNDRED TWENTY-FIVE
DOLLARS, FOR TAXABLE YEARS BEGINNING AFTER TWO  THOUSAND  THIRTEEN,  TWO
HUNDRED  FIFTY  DOLLARS,  FOR TAXABLE YEARS BEGINNING AFTER TWO THOUSAND
FOURTEEN, THREE HUNDRED SEVENTY-FIVE  DOLLARS,  AND  FOR  TAXABLE  YEARS
BEGINNING AFTER TWO THOUSAND FIFTEEN, FIVE HUNDRED DOLLARS.
  (2)  THE  CREDIT  UNDER  THIS  SUBSECTION SHALL BE ALLOWED AGAINST THE
TAXES IMPOSED BY THIS ARTICLE FOR THE TAXABLE YEAR REDUCED BY THE  CRED-
ITS PERMITTED BY THIS ARTICLE. THE AMOUNT OF THE CREDIT SHALL NOT EXCEED
THE  TAX  DETERMINED  UNDER  SUBSECTIONS  (A) THROUGH (D) OF SECTION SIX
HUNDRED ONE OF THIS PART FOR THE TAXABLE YEAR  REDUCED  BY  THE  CREDITS
PERMITTED  UNDER  SECTIONS SIX HUNDRED TWENTY AND SIX HUNDRED TWENTY-ONE
OF THIS ARTICLE.
  (3) IN THE CASE OF A HUSBAND AND WIFE WHO FILE A JOINT FEDERAL RETURN,
BUT WHO ARE REQUIRED TO DETERMINE THEIR NEW YORK STATE TAXES SEPARATELY,
THE CREDIT ALLOWED PURSUANT TO THIS SUBSECTION MAY  BE  APPLIED  AGAINST
THE TAX IMPOSED ON EITHER OR DIVIDED BETWEEN THEM AS THEY MAY ELECT.
  S  5.  The  tax  law is amended by adding a new section 664 to read as
follows:
  S 664. DISALLOWANCE OF ADDITIONAL TAX CREDITS. IF  A  TAXPAYER  CLAIMS
THE  ADDITIONAL  CREDITS  AUTHORIZED  UNDER  SUBSECTIONS (XX), (WW), AND
(AAA) OF SECTION SIX HUNDRED SIX OF THIS ARTICLE,  SUCH  TAXPAYER  SHALL
CALCULATE  THE  TAX  WITH SUCH CREDITS AND SHALL CALCULATE THE TAX AS IF
SUCH CREDITS HAD NOT BEEN CLAIMED. IF THE OVERPAYMENT DUE TO THE TAXPAY-
ER AS A RESULT OF CLAIMING THE ADDITIONAL CREDITS EXCEEDS  THE  OVERPAY-
MENT  DUE  EXCLUDING  THE  ADDITIONAL CREDITS, THE TAXPAYER SHALL NOT BE
ALLOWED TO CLAIM THE ADDITIONAL CREDITS.
  S 6. This act shall take effect immediately.

                                 PART Z

  Section 1.   The real property tax law is  amended  by  adding  a  new
section 1306-b to read as follows:
  S  1306-B. "MIDDLE CLASS STAR" REBATE PROGRAM. 1. TAX REBATES. (A) FOR
ENHANCED REBATES BEGINNING IN THE TWO  THOUSAND  THIRTEEN--TWO  THOUSAND
FOURTEEN  SCHOOL  YEAR  AND  EACH  YEAR THEREAFTER AND FOR BASIC REBATES
BEGINNING IN THE TWO THOUSAND FOURTEEN--TWO THOUSAND FIFTEEN SCHOOL YEAR
AND EACH YEAR THEREAFTER IF A PARCEL IS ENTITLED TO  THE  ENHANCED  STAR
EXEMPTION  AUTHORIZED  BY SECTION FOUR HUNDRED TWENTY-FIVE OF THIS CHAP-
TER, A LOCAL PROPERTY TAX REBATE SHALL  BE  PROVIDED  TO  THE  OWNER  OR
OWNERS  OF  SUCH  PARCEL  AS SHOWN ON THE FINAL ASSESSMENT ROLL FOR SUCH
YEAR, IN AN AMOUNT COMPUTED AS PRESCRIBED BY THIS  SECTION  AND  SECTION
ONE HUNDRED SEVENTY-EIGHT OF THE TAX LAW.
  (B)  FOR  THE  TWO THOUSAND FOURTEEN--TWO THOUSAND FIFTEEN SCHOOL YEAR
AND EACH YEAR THEREAFTER IF A PARCEL  IS  ENTITLED  TO  THE  BASIC  STAR
EXEMPTION  AUTHORIZED  BY SECTION FOUR HUNDRED TWENTY-FIVE OF THIS CHAP-
TER, A LOCAL PROPERTY TAX REBATE SHALL  BE  PROVIDED  TO  THE  OWNER  OR

S. 2609--C                         48

OWNERS  OF  SUCH  PARCEL  AS SHOWN ON THE FINAL ASSESSMENT ROLL FOR SUCH
YEAR, IN AN AMOUNT COMPUTED AS PRESCRIBED BY THIS  SECTION  AND  SECTION
ONE HUNDRED SEVENTY-EIGHT OF THE TAX LAW.
  (C) IT SHALL BE THE RESPONSIBILITY OF THE DEPARTMENT TO ISSUE SUCH TAX
REBATES  TO  SUCH  OWNERS  IN THE MANNER PROVIDED BY SECTION ONE HUNDRED
SEVENTY-EIGHT  OF  THE  TAX  LAW.  NOTHING  CONTAINED  HEREIN  SHALL  BE
CONSTRUED  AS  PERMITTING  PARTIAL OR INSTALLMENT PAYMENTS OF TAXES IN A
JURISDICTION WHICH HAS NOT AUTHORIZED THE SAME PURSUANT TO LAW.
  2. PROCEDURE. (A) ON OR BEFORE AUGUST FIFTEENTH, TWO THOUSAND THIRTEEN
AND EACH YEAR THEREAFTER, THE COMMISSIONER,  OR  HIS  OR  HER  DESIGNEE,
SHALL  CREATE  A REPORT CONCERNING THOSE PARCELS WHICH HAVE BEEN GRANTED
AN EXCEPTION AUTHORIZED BY SECTION  FOUR  HUNDRED  TWENTY-FIVE  OF  THIS
CHAPTER, OR ON OR BEFORE JULY FIRST, TWO THOUSAND THIRTEEN AND EACH YEAR
THEREAFTER,  IN  THE  CASE OF A CITY WITH A POPULATION OF ONE MILLION OR
MORE, THE COMMISSIONER OF FINANCE, OR HIS OR HER DESIGNEE, SHALL PROVIDE
TO THE COMMISSIONER OF TAXATION AND  FINANCE  A  REPORT  IN  A  MUTUALLY
AGREEABLE  FORMAT  CONCERNING  THOSE  PARCELS WHICH HAVE BEEN GRANTED AN
EXEMPTION AUTHORIZED BY SECTION FOUR HUNDRED TWENTY-FIVE OF THIS CHAPTER
ON THE ASSESSMENT ROLLS USED TO GENERATE THE SCHOOL TAX  BILLS  FOR  THE
TWO  THOUSAND  THIRTEEN--TWO  THOUSAND  FOURTEEN SCHOOL TAX YEAR AND FOR
EACH YEAR THEREAFTER; PROVIDED HOWEVER THE INFORMATION TO BE PROVIDED ON
SUCH REPORT SHALL BE OBTAINED FROM THE FINAL ASSESSMENT ROLL DATA  FILES
USED TO GENERATE THE TWO THOUSAND THIRTEEN--TWO THOUSAND FOURTEEN SCHOOL
TAX  BILLS  AND EACH YEAR THEREAFTER, FILED WITH THE DEPARTMENT PURSUANT
TO SECTION FIFTEEN HUNDRED NINETY OF THIS  CHAPTER  ON  OR  BEFORE  JULY
THIRTY-FIRST  OF  SUCH  YEAR.  SUCH REPORT SHALL SET FORTH THE NAMES AND
MAILING ADDRESSES OF THE OWNERS OF SUCH PARCELS AS SHOWN ON SUCH ASSESS-
MENT ROLL DATA FILES, THE IDENTIFICATION  NUMBERS  OF  SUCH  PARCELS  AS
SHOWN  ON SUCH ASSESSMENT ROLL DATA FILES, AND SUCH OTHER INFORMATION IN
THE POSSESSION OF THE DEPARTMENT, OR IN THE CASE OF A CITY WITH A  POPU-
LATION  OF  ONE  MILLION  OR  MORE,  THE COMMISSIONER OF FINANCE, AS THE
COMMISSIONER MAY DEEM NECESSARY FOR THE EFFECTIVE ADMINISTRATION OF THIS
PROGRAM, INCLUDING INFORMATION REGARDING COOPERATIVE APARTMENT BUILDINGS
AND MOBILE HOME PARKS OR SIMILAR PROPERTY. IT SHALL BE THE  RESPONSIBIL-
ITY  OF  THE ASSESSOR OR ASSESSORS OF EACH ASSESSING UNIT TO ENSURE THAT
THE NAMES AND MAILING ADDRESSES OF SUCH OWNERS ARE  ACCURATELY  RECORDED
ON  SUCH  ROLLS  AND FILES TO THE BEST OF HIS OR HER ABILITY, BASED UPON
THE INFORMATION CONTAINED IN HIS OR HER  OFFICE.  NOTHING  CONTAINED  IN
THIS SUBDIVISION SHALL BE CONSTRUED AS AFFECTING IN ANY WAY THE VALIDITY
OR ENFORCEABILITY OF A REAL PROPERTY TAX, OR THE APPLICABILITY OF INTER-
EST  OR  PENALTIES WITH RESPECT THERETO, WHEN AN OWNER'S NAME OR MAILING
ADDRESS HAS NOT BEEN ACCURATELY RECORDED.
  (B) NOTWITHSTANDING THE PROVISIONS OF PARAGRAPH (A) OF  THIS  SUBDIVI-
SION,  WHERE AN ASSESSING UNIT CONTAINS ONE OR MORE PROPERTIES WHICH ARE
RECEIVING SUCH EXEMPTION IN RELATION TO A  PRIOR  YEAR  ASSESSMENT  ROLL
PURSUANT  TO  PARAGRAPH  (D)  OF SUBDIVISION SIX OF SECTION FOUR HUNDRED
TWENTY-FIVE OF THIS CHAPTER,  OR  CONTAINS  ONE  OR  MORE  PARCELS  WITH
RESPECT  TO  WHICH  SUCH  EXEMPTION  WAS DULY ADDED OR REMOVED AFTER THE
FILING OF THE FINAL ASSESSMENT ROLL PURSUANT TO THE PROVISIONS OF  TITLE
THREE  OF  ARTICLE  FIVE OF THIS CHAPTER, THE DEPARTMENT MAY REQUIRE THE
ASSESSOR TO FILE WITH IT, ON OR BEFORE JULY THIRTY-FIRST,  TWO  THOUSAND
THIRTEEN AND EACH YEAR THEREAFTER, OR SUCH LATER DATE AS SUCH OFFICE MAY
SPECIFY,  A SUPPLEMENTAL REPORT RELATING TO SUCH PROPERTY OR PROPERTIES,
SO THAT INFORMATION PERTAINING TO THE OWNERS THEREOF MAY BE INCLUDED  IN
THE  REPORT  TO  BE MADE TO THE COMMISSIONER PURSUANT TO THIS PARAGRAPH.
WHEN ANY INFORMATION REQUIRED BY  THIS  PARAGRAPH  IS  RECEIVED  BY  THE

S. 2609--C                         49

DEPARTMENT  AFTER JULY THIRTY-FIRST, TWO THOUSAND THIRTEEN AND EACH YEAR
THEREAFTER, SUCH INFORMATION SHALL BE TRANSMITTED AS SOON AS  REASONABLY
PRACTICABLE  FOR  USE  IN ISSUING LOCAL PROPERTY TAX REBATES PURSUANT TO
SECTION ONE HUNDRED SEVENTY-EIGHT OF THE TAX LAW.
  3. REBATE BASE.  (A) THE DEPARTMENT SHALL CALCULATE THE REBATE BASE AS
PROVIDED HEREIN AND CERTIFY THE SAME NO LATER THAN JULY FIRST, TWO THOU-
SAND THIRTEEN.
  (B)  THREE  REBATE  BASES FOR THE BASIC STAR EXEMPTION SHALL BE DETER-
MINED FOR EACH SEGMENT  FOR  THE  TWO  THOUSAND  FOURTEEN--TWO  THOUSAND
FIFTEEN AND SUBSEQUENT SCHOOL YEARS. SUCH REBATE BASES SHALL BE COMPUTED
BY  DETERMINING  THE  EXEMPT  AMOUNT  ESTABLISHED  FOR  THE  SEGMENT FOR
PURPOSES OF THE BASIC STAR EXEMPTION FOR THE TWO THOUSAND  FOURTEEN--TWO
THOUSAND  FIFTEEN  SCHOOL  YEAR,  MULTIPLYING  THAT AMOUNT BY THE SCHOOL
DISTRICT TAX RATE APPLICABLE WITHIN THAT SEGMENT FOR PURPOSES OF THE TWO
THOUSAND FOURTEEN--TWO THOUSAND FIFTEEN SCHOOL YEAR, AS REPORTED BY  THE
SCHOOL DISTRICT, AND THEN MULTIPLYING THE PRODUCT BY THE FOLLOWING:
  (I)  FOR  PURPOSES  OF THE TWO THOUSAND FOURTEEN--TWO THOUSAND FIFTEEN
SCHOOL YEAR AND THE TWO THOUSAND FIFTEEN--TWO  THOUSAND  SIXTEEN  SCHOOL
YEAR,  BY  SEVENTY  PERCENT  FOR THE FIRST INCOME BRACKET, FIFTY-TWO AND
ONE-HALF PERCENT FOR THE SECOND INCOME BRACKET AND  THIRTY-FIVE  PERCENT
FOR THE THIRD INCOME BRACKET.
  (II)  FOR PURPOSES OF THE TWO THOUSAND SIXTEEN--TWO THOUSAND SEVENTEEN
SCHOOL YEAR, BY EIGHTY PERCENT  FOR  THE  FIRST  INCOME  BRACKET,  SIXTY
PERCENT  FOR  THE SECOND INCOME BRACKET, AND FORTY PERCENT FOR THE THIRD
INCOME BRACKET.
  (III) FOR PURPOSES OF THE TWO THOUSAND SEVENTEEN--TWO  THOUSAND  EIGH-
TEEN AND SUBSEQUENT SCHOOL YEARS, BY NINETY PERCENT FOR THE FIRST INCOME
BRACKET,  SEVENTY  PERCENT FOR THE SECOND INCOME BRACKET, AND FORTY-FIVE
PERCENT FOR THE THIRD INCOME BRACKET.
  (IV) INCOME BRACKETS. (A) IN THE CITY OF NEW YORK, AND THE COUNTIES OF
NASSAU, SUFFOLK, ROCKLAND, WESTCHESTER, PUTNAM, ORANGE AND DUTCHESS, THE
FIRST INCOME BRACKET SHALL BE UP TO AND  INCLUDING  ONE  HUNDRED  TWENTY
THOUSAND  DOLLARS;  THE  SECOND INCOME BRACKET SHALL BE OVER ONE HUNDRED
TWENTY THOUSAND DOLLARS UP TO AND  INCLUDING  ONE  HUNDRED  SEVENTY-FIVE
THOUSAND DOLLARS; AND THE THIRD INCOME BRACKET SHALL BE OVER ONE HUNDRED
SEVENTY-FIVE  THOUSAND  DOLLARS  UP  TO  AND INCLUDING TWO HUNDRED FIFTY
THOUSAND DOLLARS.
  (B) IN ALL OTHER COUNTIES IN THE STATE, THE FIRST INCOME BRACKET SHALL
BE UP TO AND INCLUDING NINETY THOUSAND DOLLARS; THE SECOND INCOME BRACK-
ET SHALL BE OVER NINETY THOUSAND DOLLARS AND UP  TO  AND  INCLUDING  ONE
HUNDRED  FIFTY  THOUSAND  DOLLARS; AND THE THIRD INCOME BRACKET SHALL BE
OVER ONE HUNDRED FIFTY THOUSAND DOLLARS AND  UP  TO  AND  INCLUDING  TWO
HUNDRED FIFTY THOUSAND DOLLARS.
  (C)  SUCH BRACKETS SHALL BE SUBJECT TO INDEXING FOR INFLATION PURSUANT
TO SUBDIVISION FOURTEEN OF SECTION ONE HUNDRED SEVENTY-EIGHT OF THE  TAX
LAW.
  (C)  ONE  REBATE  BASE FOR THE ENHANCED STAR EXEMPTION SHALL BE DETER-
MINED FOR EACH SEGMENT FOR THE TWO THOUSAND THIRTEEN--TWO THOUSAND FOUR-
TEEN SCHOOL YEAR AND SUBSEQUENT SCHOOL YEARS. SUCH REBATE BASES SHALL BE
COMPUTED BY DETERMINING THE EXEMPT AMOUNT ESTABLISHED  FOR  THE  SEGMENT
FOR  PURPOSES  OF THE ENHANCED STAR EXEMPTION FOR THE TWO THOUSAND THIR-
TEEN--TWO THOUSAND FOURTEEN SCHOOL YEAR, MULTIPLYING THAT AMOUNT BY  THE
SCHOOL  DISTRICT TAX RATE APPLICABLE WITHIN THAT SEGMENT FOR PURPOSES OF
THAT SCHOOL YEAR, AS REPORTED BY THE SCHOOL DISTRICT, AND THEN MULTIPLY-
ING THE PRODUCT BY THE FOLLOWING:

S. 2609--C                         50

  (I) FOR PURPOSES OF THE TWO THOUSAND THIRTEEN--TWO  THOUSAND  FOURTEEN
SCHOOL YEAR, BY THIRTY-FIVE PERCENT.
  (II)  FOR  PURPOSES OF THE TWO THOUSAND FOURTEEN--TWO THOUSAND FIFTEEN
AND SUBSEQUENT SCHOOL YEARS, BY FORTY-FIVE PERCENT.
  (D) FOR PURPOSES OF THIS SECTION, THE TERM "SEGMENT" MEANS THE PART OF
A CITY OR TOWN THAT IS WITHIN A SCHOOL DISTRICT.
  (E) IN THE CASE OF SCHOOL DISTRICTS WITHIN SPECIAL ASSESSING UNITS  AS
DEFINED  IN  SECTION  EIGHTEEN  HUNDRED  ONE OF THIS CHAPTER, THE SCHOOL
DISTRICT TAX RATE TO BE USED FOR THIS PURPOSE  SHALL  BE  THE  TAX  RATE
APPLICABLE  TO  CLASS  ONE  PROPERTIES AS DEFINED IN ARTICLE EIGHTEEN OF
THIS CHAPTER, AS REPORTED BY THE SCHOOL DISTRICT AND THE  EXEMPT  AMOUNT
SHALL  BE  ESTABLISHED  FOR THE SEGMENT. IN THE CASE OF SCHOOL DISTRICTS
WITHIN APPROVED ASSESSING UNITS AS DEFINED IN SECTION  NINETEEN  HUNDRED
ONE  OF  THIS CHAPTER WHICH HAVE ADOPTED THE PROVISIONS OF SECTION NINE-
TEEN HUNDRED THREE OF THIS CHAPTER, THE SCHOOL DISTRICT TAX RATE  TO  BE
USED  FOR THIS PURPOSE SHALL BE THE TAX RATE APPLICABLE TO THE HOMESTEAD
CLASS, AS DEFINED IN ARTICLE NINETEEN OF THIS CHAPTER,  AS  REPORTED  BY
THE SCHOOL DISTRICT.
  (F)  WHERE  THE  PROVISIONS  OF  SUBPARAGRAPH (IV) OF PARAGRAPH (K) OF
SUBDIVISION TWO OF SECTION FOUR HUNDRED TWENTY-FIVE OF THIS CHAPTER  ARE
APPLICABLE,  THE  APPLICABLE  REBATE  AMOUNT  SHALL  BE ONE-THIRD OF THE
OTHERWISE APPLICABLE REBATE AMOUNT SET FORTH IN PARAGRAPH (B) OR (C)  OF
THIS SUBDIVISION. THE DEPARTMENT OF TAXATION AND FINANCE SHALL CALCULATE
AND  CERTIFY THE REBATE AMOUNTS APPLICABLE IN SUCH CASES, ALONG WITH THE
CERTIFICATION REQUIRED BY PARAGRAPH (A) OF THIS SUBDIVISION.
  S 2. The tax law is amended by adding a new section  178  to  read  as
follows:
  S  178.  "MIDDLE CLASS STAR" REBATE PROGRAM. 1. THE COMMISSIONER SHALL
ISSUE THE LOCAL PROPERTY TAX  REBATES  AUTHORIZED  BY  SECTION  THIRTEEN
HUNDRED SIX-B OF THE REAL PROPERTY TAX LAW. FOR PURPOSES OF THIS SECTION
THE  REBATE  SHALL BE CALCULATED USING THE COMPUTATION FORMULA SET FORTH
IN SUBDIVISION THREE OF SECTION THIRTEEN HUNDRED SIX-B OF THE REAL PROP-
ERTY TAX LAW. PROVIDED, HOWEVER, SUCH REBATES SHALL NOT BE ISSUED IN ANY
YEAR IN WHICH AN APPROPRIATION TO PAY SUCH REBATES HAS NOT BEEN INCLUDED
IN THE ENACTED STATE BUDGET FOR SUCH YEAR.
  2. ON OR BEFORE AUGUST FIFTEENTH, TWO THOUSAND THIRTEEN AND EACH  YEAR
THEREAFTER,  THE  COMMISSIONER,  OR  HIS OR HER DESIGNEE, SHALL CREATE A
REPORT CONCERNING THOSE PARCELS WHICH SATISFY THE CRITERIA SET FORTH  IN
SECTION  THIRTEEN  HUNDRED  SIX-B OF THE REAL PROPERTY TAX LAW, OR ON OR
BEFORE JULY FIRST, TWO THOUSAND THIRTEEN AND EACH YEAR THEREAFTER IN THE
CASE OF A CITY WITH A POPULATION OF ONE MILLION OR MORE, THE COMMISSION-
ER OF FINANCE, SHALL PROVIDE TO THE COMMISSIONER A REPORT IN A  MUTUALLY
AGREEABLE FORMAT CONCERNING THOSE PARCELS WHICH SATISFY THE CRITERIA SET
FORTH IN SECTION THIRTEEN HUNDRED SIX-B OF THE REAL PROPERTY TAX LAW.
  3.  THE COMMISSIONER IN CONSULTATION WITH THE COMMISSIONER OF FINANCE,
FOR A CITY WITH A POPULATION OF ONE MILLION OR MORE,  IS  AUTHORIZED  TO
DEVELOP  PROCEDURES NECESSARY TO PROVIDE FOR THE ISSUANCE OF LOCAL PROP-
ERTY TAX REBATES TO QUALIFYING PROPERTY  OWNERS,  AND  THOSE  QUALIFYING
PROPERTY OWNERS THAT DID NOT RECEIVE THEM INITIALLY. IF THE COMMISSIONER
IS  NOT  SATISFIED  THAT  THE  PROPERTY OWNER IS QUALIFIED FOR THE LOCAL
PROPERTY TAX REBATE, THE COMMISSIONER SHALL NOT ISSUE SUCH REBATE.
  4.  BY DEPOSITING A REBATE ISSUED PURSUANT TO THIS SECTION AND AUTHOR-
IZED BY SECTION THIRTEEN HUNDRED SIX-B OF THE REAL PROPERTY TAX LAW, THE
PAYEE IS CERTIFYING THAT HE OR SHE IS THE PROPERTY OWNER, AND  THAT  THE
PRIMARY  RESIDENCE  OF  SUCH PROPERTY OWNER IS NOT SUBJECT TO ANY DELIN-
QUENT SCHOOL TAXES.

S. 2609--C                         51

  5. VERIFICATION OF "AFFILIATED INCOME" FOR "MIDDLE CLASS STAR"  REBATE
PROGRAM. (A) THE DETERMINATION OF THE "AFFILIATED INCOME" OF PARCELS FOR
PURPOSES  OF  THE  "MIDDLE  CLASS  STAR" REBATE PROGRAM AS AUTHORIZED BY
SUBDIVISION THREE OF SECTION THIRTEEN HUNDRED SIX-B OF THE REAL PROPERTY
TAX LAW SHALL BE MADE AS PROVIDED BY THIS SECTION.
  (B) FOR PURPOSES OF THIS SUBDIVISION, THE TERM "INCOME" SHALL HAVE THE
SAME  MEANING  AS  SET  FORTH  IN  SUBPARAGRAPH (II) OF PARAGRAPH (B) OF
SUBDIVISION FOUR OF SECTION FOUR HUNDRED TWENTY-FIVE OF THE REAL PROPER-
TY TAX LAW. THE TERM "AFFILIATED INCOME" SHALL MEAN THE COMBINED  INCOME
OF  ALL OF THE OWNERS OF THE PARCEL WHO RESIDED PRIMARILY THEREON ON THE
TAXABLE STATUS DATE FOR THE ASSESSMENT ROLL USED TO GENERATE THE  APPLI-
CABLE  SCHOOL  TAX  BILLS,  AND OF ANY OWNERS' SPOUSES FILING JOINTLY OR
SPOUSES RESIDING PRIMARILY THEREON IN THE CASES OF SPOUSES FILING  SEPA-
RATE  RETURNS  ON  SUCH  TAXABLE  STATUS DATE AND SHALL BE DETERMINED AS
FOLLOWS:
  (I) FOR THE TWO THOUSAND THIRTEEN--TWO THOUSAND FOURTEEN SCHOOL  YEAR,
AFFILIATED  INCOME  SHALL  BE DETERMINED BASED UPON THE PARTIES' INCOMES
FOR THE INCOME TAX YEAR ENDING IN TWO THOUSAND ELEVEN.  IN  EACH  SUBSE-
QUENT  YEAR,  THE  APPLICABLE  INCOME  TAX YEAR SHALL BE ADVANCED BY ONE
YEAR.
  (II) THE DEPARTMENT SHALL DETERMINE THE  AFFILIATED  INCOME  FOR  EACH
PARCEL  AND SHALL ASSIGN A REBATE AMOUNT FOR EACH PARCEL BASED UPON SUCH
DETERMINATION. IN ANY CASE WHERE AFFILIATED INCOME CANNOT BE DETERMINED,
A REBATE SHALL NOT BE ISSUED.
  6. NOTIFICATION REQUIREMENT. THE  DEPARTMENT  SHALL  MAIL  INFORMATION
CONCERNING  THE  "MIDDLE CLASS STAR" REBATE PROGRAM TO OWNERS OF PARCELS
RECEIVING A BASIC STAR EXEMPTION ON THE ASSESSMENT ROLL USED TO GENERATE
THE TWO THOUSAND FOURTEEN--TWO THOUSAND FIFTEEN SCHOOL  TAX  BILL.  SUCH
NOTIFICATION  SHALL  EXPLAIN THAT PROPERTY OWNERS MUST FILE APPLICATIONS
WITH THE DEPARTMENT IN ORDER TO OBTAIN THE REBATE  AVAILABLE  UNDER  THE
"MIDDLE  CLASS  STAR"  REBATE PROGRAM. SUCH NOTICE SHALL FURTHER EXPLAIN
HOW TO OBTAIN THE APPLICATION.
  7. APPLICATIONS. (A) IN ORDER TO OBTAIN THE BENEFITS  OF  THE  "MIDDLE
CLASS  STAR"  REBATE PROGRAM, THE PROPERTY OWNER MUST SUBMIT AN APPLICA-
TION TO THE DEPARTMENT NO LATER THAN DECEMBER THIRTY-FIRST, TWO THOUSAND
FOURTEEN. THE APPLICANT SHALL PROVIDE THE DEPARTMENT WITH SUCH  INFORMA-
TION  AS  MAY  BE NECESSARY TO DETERMINE THE PARCEL'S AFFILIATED INCOME.
THE PERSONS OTHER THAN THE APPLICANT WHOSE INCOMES ARE NECESSARY TO  THE
DETERMINATION  OF THE PARCEL'S AFFILIATED INCOME SHALL BE REFERRED TO IN
THIS SECTION AS "AFFILIATED PERSONS." RECIPIENTS OF  THE  ENHANCED  STAR
EXEMPTION SHALL NOT FILE AN APPLICATION TO RECEIVE A REBATE. THE DEPART-
MENT SHALL MAIL ENHANCED STAR REBATE RECIPIENTS THEIR REBATES IN A TIME-
LY MANNER.
  (B)  IF  THE  APPLICANT OR ANY AFFILIATED PERSONS WERE NOT REQUIRED TO
FILE NEW YORK STATE INCOME TAX  RETURNS  FOR  THE  TWO  THOUSAND  TWELVE
INCOME  TAX  YEAR  BECAUSE  THEIR  INCOMES WERE BELOW THE THRESHOLD THAT
NECESSITATED SUCH FILING, THE APPLICATION SHALL SO INDICATE.
  (C) IF THE APPLICANT OR ANY AFFILIATED PERSONS WERE  NOT  REQUIRED  TO
FILE  NEW  YORK  STATE  INCOME  TAX  RETURNS FOR THE TWO THOUSAND TWELVE
INCOME TAX YEAR BECAUSE THEY DID NOT RESIDE IN NEW YORK  STATE  IN  SUCH
TAXABLE  YEAR,  THE  APPLICATION  SHALL  SO INDICATE. SUCH PERSONS SHALL
PROVIDE WITH THE APPLICATION ANY INFORMATION THAT THE DEPARTMENT  DETER-
MINES IS NECESSARY TO CALCULATE THE PARCEL'S AFFILIATED INCOME UNDER THE
"MIDDLE CLASS STAR" REBATE PROGRAM.
  (D)  AFTER  TWO THOUSAND FOURTEEN, APPLICATIONS SHALL BE REQUIRED ONLY
WHEN A NEW APPLICATION FOR A BASIC  STAR  EXEMPTION  FOR  REAL  PROPERTY

S. 2609--C                         52

TAXATION  IS  FILED  PURSUANT TO SECTION FOUR HUNDRED TWENTY-FIVE OF THE
REAL PROPERTY TAX LAW, OR WHEN THERE IS A CHANGE OF OWNERSHIP WHICH DOES
NOT NECESSITATE THE FILING  OF  A  NEW  APPLICATION  FOR  A  BASIC  STAR
EXEMPTION.  IN EITHER INSTANCE, AN APPLICATION SHALL BE SUBMITTED TO THE
DEPARTMENT ON A TIMELY BASIS.
  (E)  IF  AN  APPLICATION  FOR A "MIDDLE CLASS STAR" REBATE IS RECEIVED
AFTER DECEMBER THIRTY-FIRST, TWO THOUSAND FOURTEEN, AN OTHERWISE  ELIGI-
BLE  PROPERTY  OWNER  SHALL NOT RECEIVE A REBATE FOR SUCH YEAR. HOWEVER,
SUCH APPLICATION SHALL BE CONSIDERED TIMELY FILED FOR A REBATE IN SUBSE-
QUENT YEARS PROVIDED THE OWNERSHIP OF THE PARCEL REMAINS UNCHANGED.
  8. PROCESSING OF APPLICATIONS. (A) AFTER RECEIVING A  TIMELY  APPLICA-
TION, THE DEPARTMENT SHALL ATTEMPT TO DETERMINE THE AFFILIATED INCOME OF
THE  PARCEL  AND  THE  REBATE AMOUNT TO WHICH THE PARCEL IS ENTITLED, IF
ANY.
  (B) IN THE CASE OF AN APPLICATION WHICH INDICATES THAT  THE  APPLICANT
AND  ANY  AFFILIATED  PERSONS  WERE  NOT REQUIRED TO FILE NEW YORK STATE
INCOME TAX RETURNS FOR THE TWO THOUSAND TWELVE INCOME TAX  YEAR  BECAUSE
THEIR  INCOMES WERE BELOW THE THRESHOLD WHICH NECESSITATED THE FILING OF
A STATE INCOME TAX RETURN, THE DEPARTMENT MAY, SUBJECT TO AUDIT, ISSUE A
REBATE EQUAL TO THE HIGHEST AMOUNT AVAILABLE FOR  THAT  SCHOOL  DISTRICT
SEGMENT.
  (C)  IN  THE CASE OF AN APPLICATION WHICH INDICATES THAT THE APPLICANT
AND ANY AFFILIATED PERSONS WERE NOT REQUIRED  TO  FILE  NEW  YORK  STATE
INCOME  TAX  RETURNS FOR THE TWO THOUSAND TWELVE INCOME TAX YEAR BECAUSE
THEY DID NOT RESIDE IN NEW YORK STATE IN SUCH TAXABLE YEAR,  THE  APPLI-
CANT  SHALL PROVIDE SUCH INFORMATION REGARDING INCOME AS IS REQUESTED BY
THE DEPARTMENT. THE DEPARTMENT SHALL  ISSUE  A  REBATE  BASED  UPON  THE
INFORMATION PROVIDED BY THE APPLICANT AND ANY OTHER INFORMATION TO WHICH
THE  DEPARTMENT  MAY HAVE ACCESS CONCERNING THE INCOME OF SUCH PERSON OR
PERSONS.
  9. RECONSIDERATION OF REBATE AMOUNT. IN THE EVENT  THE  DEPARTMENT  IS
UNABLE TO DETERMINE THE AFFILIATED INCOME FOR A PARCEL OR THE DEPARTMENT
DETERMINES  THAT  A REBATE SHALL NOT BE ISSUED FOR A PARCEL, THE DEPART-
MENT SHALL NOTIFY THE APPLICANT OF THAT FACT. A PROPERTY OWNER MAY  SEEK
RECONSIDERATION OF THE REBATE AMOUNT DETERMINATION FOR HIS OR HER PARCEL
ON  THE GROUNDS THAT THE PARCEL'S AFFILIATED INCOME WAS DETERMINED ERRO-
NEOUSLY. A PROPERTY OWNER MAY ALSO SEEK RECONSIDERATION IF NO REBATE WAS
ISSUED BECAUSE THE  PARCEL'S  AFFILIATED  INCOME  WAS  UNDETERMINED.  AN
APPLICATION  FOR  RECONSIDERATION  OF  REBATE  AMOUNT SHALL BE MADE IN A
MANNER PRESCRIBED BY THE DEPARTMENT, AND SHALL BE  ACCOMPANIED  BY  SUCH
DOCUMENTATION  AS  THE DEPARTMENT MAY REQUIRE. SUCH APPLICATION SHALL BE
FILED NO LATER THAN MARCH THIRTY-FIRST, TWO  THOUSAND  FIFTEEN.  IF  THE
DEPARTMENT  FINDS  AFTER  REVIEWING  SUCH AN APPLICATION THAT THE REBATE
AMOUNT DETERMINATION FOR A PARCEL SHOULD BE CORRECTED, IT SHALL ISSUE AN
AMENDED OR INITIAL REBATE CHECK. IF THE DEPARTMENT FINDS AFTER REVIEWING
SUCH AN APPLICATION THAT THE REBATE AMOUNT DETERMINATION FOR THE  PARCEL
WAS CORRECTLY DETERMINED, IT SHALL SO NOTIFY THE APPLICANT. SUCH NOTIFI-
CATION  SHALL INCLUDE AN EXPLANATION OF THE DEPARTMENT'S FINDINGS, INDI-
CATE THAT THE APPLICANT HAS THE RIGHT  TO  A  PROCEEDING  UNDER  ARTICLE
SEVENTY-EIGHT  OF  THE  CIVIL  PRACTICE  LAW AND RULES, AND INDICATE THE
STATUTE OF LIMITATIONS ASSOCIATED WITH SUCH  PROCEEDINGS.  SUCH  FINDING
SHALL  BE  SUBJECT TO REVIEW PURSUANT ONLY TO A PROCEEDING UNDER ARTICLE
SEVENTY-EIGHT OF THE CIVIL PRACTICE LAW AND RULES.
  10. SPECIAL PROVISIONS RELATING TO CO-OPERATIVE  APARTMENT  UNITS  AND
MOBILE  HOMES. THE DEPARTMENT'S DETERMINATION OF AFFILIATED INCOME SHALL

S. 2609--C                         53

BE MADE WITH RESPECT TO THE TENANT-SHAREHOLDERS OR OWNERS OF THE UNIT IN
QUESTION RATHER THAN OF THE PARCEL.
  11.  SUBSEQUENT  YEARS.  IN EACH YEAR SUBSEQUENT TO TWO THOUSAND FOUR-
TEEN, AFFILIATED INCOMES SHALL CONTINUE TO BE DETERMINED AS PROVIDED  BY
THIS  SECTION  FOR  PURPOSES  OF THE "MIDDLE CLASS STAR" REBATE PROGRAM,
EXCEPT THAT:
  (A) THE NOTIFICATION REQUIREMENT OF SUBDIVISION SIX  OF  THIS  SECTION
SHALL NOT BE APPLICABLE;
  (B)  APPLICATIONS  SHALL  BE  REQUIRED ONLY AS PROVIDED IN SUBDIVISION
SEVEN OF THIS SECTION; AND
  (C) IN EACH SUBSEQUENT YEAR, THE APPLICABLE INCOME TAX YEAR FOR DETER-
MINATIONS UNDER THIS SECTION SHALL  BE  ADVANCED  ONE  YEAR.  ALL  OTHER
APPLICABLE  DATES  AND  DEADLINES WHICH REFERENCE A DATE IN TWO THOUSAND
THIRTEEN SHALL BE ADVANCED AND SHALL BE DEEMED  TO  REFERENCE  DATES  IN
THAT  SUBSEQUENT  YEAR,  EXCEPT THAT APPLICATIONS FOR RECONSIDERATION OF
REBATE AMOUNT DETERMINATIONS SHALL BE  SUBMITTED  NO  LATER  THAN  MARCH
THIRTY-FIRST OF THE ENSUING YEAR.
  12.  CONFIDENTIAL  INFORMATION;  DISCLOSURE  PROHIBITION.  INFORMATION
REGARDING REBATES ISSUED TO INDIVIDUALS SHALL NOT BE SUBJECT TO  DISCLO-
SURE;  INCLUDING  NAMES,  ADDRESSES,  AND DOLLAR AMOUNTS OF REBATES.  IN
ADDITION, ALL APPLICATIONS SUBMITTED FOR REBATES SHALL NOT BE SUBJECT TO
DISCLOSURE.
  13. DEADLINE. IF ANY APPLICABLE DEADLINE SHALL  FALL  ON  A  SATURDAY,
SUNDAY  OR  LEGAL  HOLIDAY,  SUCH DEADLINE SHALL BE ADVANCED TO THE NEXT
BUSINESS DAY.
  14. AFFILIATED INCOME BRACKETS; INDEXING. THE DEPARTMENT SHALL  ESTAB-
LISH  THE  AFFILIATED  INCOME  BRACKETS TO BE ASSOCIATED WITH THE REBATE
AMOUNTS FOR THE TWO THOUSAND SIXTEEN--TWO THOUSAND SEVENTEEN SCHOOL YEAR
AND EACH SCHOOL YEAR THEREAFTER BY APPLYING  THE  INFLATION  FACTOR  SET
FORTH  IN THIS SUBDIVISION TO THE FIGURES THAT DEFINED THE INCOME BRACK-
ETS THAT WERE APPLICABLE  TO  THE  TWO  THOUSAND  FIFTEEN--TWO  THOUSAND
SIXTEEN SCHOOL YEAR, AND ROUNDING EACH RESULT TO THE NEAREST MULTIPLE OF
ONE  HUNDRED DOLLARS.   FOR PURPOSES OF THIS SUBDIVISION, THE "INFLATION
FACTOR" FOR EACH INCOME BRACKET SHALL BE DETERMINED  BY  THE  PERCENTAGE
INCREASE IN THE CONSUMER PRICE INDEX FOR URBAN WAGE EARNERS AND CLERICAL
WORKERS  (CPI-W)  PUBLISHED  BY  THE  UNITED STATES DEPARTMENT OF LABOR,
BUREAU OF LABOR STATISTICS, FOR THE THIRD QUARTER OF THE  CALENDAR  YEAR
PRECEDING  THE  APPLICABLE SCHOOL YEAR, AS COMPARED TO THE THIRD QUARTER
OF THE PRIOR CALENDAR YEAR. IF A BASE FIGURE AS  SO  DETERMINED  IS  NOT
EXACTLY  EQUAL TO A MULTIPLE OF ONE HUNDRED DOLLARS, IT SHALL BE ROUNDED
TO THE NEAREST MULTIPLE OF  ONE  HUNDRED  DOLLARS.  IN  EACH  SUBSEQUENT
SCHOOL YEAR, THE PRIOR YEAR'S INCOME BRACKETS SHALL BE INDEXED USING THE
ABOVE FORMULA WITH EACH YEAR ADVANCED BY ONE YEAR.
  S  3. Section 606 of the tax law is amended by adding a new subsection
(n-1) to read as follows:
  (N-1) SCHOOL DISTRICT PROPERTY TAX CREDIT. (1) IN ANY TAXABLE YEAR  IN
WHICH  TAXPAYERS ARE NOT ELIGIBLE TO RECEIVE REBATES PURSUANT TO SECTION
ONE HUNDRED SEVENTY-EIGHT OF THIS CHAPTER SOLELY  BECAUSE  AN  APPROPRI-
ATION  TO PAY SUCH REBATES WAS NOT INCLUDED IN THE ENACTED STATE BUDGET,
FOR SUCH YEAR, THE CREDIT ALLOWED BY THIS SUBSECTION SHALL APPLY.
  (2) FOR TAXABLE YEARS BEGINNING ON OR AFTER JANUARY FIRST,  TWO  THOU-
SAND THIRTEEN IF THE CREDIT IS APPLICABLE IN SUCH YEAR, A TAXPAYER SHALL
BE ALLOWED A CREDIT AGAINST THE TAX IMPOSED BY THIS ARTICLE IN AN AMOUNT
EQUAL  TO  THE  REBATE  CHECK CALCULATED PURSUANT TO SECTION ONE HUNDRED
SEVENTY-EIGHT OF THIS CHAPTER.

S. 2609--C                         54

  (3) 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
ACCORDANCE WITH THE PROVISIONS OF SECTION SIX HUNDRED EIGHTY-SIX OF THIS
ARTICLE, PROVIDED, HOWEVER, THAT NO INTEREST SHALL BE PAID THEREON.
  (4)  (A)  TAXPAYERS WHO WOULD HAVE QUALIFIED FOR THE CREDIT UNDER THIS
SUBSECTION FOR TAXABLE YEAR TWO THOUSAND TWELVE, HAD  SUCH  CREDIT  BEEN
AUTHORIZED  IN  SUCH  TAXABLE  YEAR,  SHALL  BE TREATED AS HAVING MADE A
PAYMENT AGAINST THE TAX IMPOSED BY THIS ARTICLE FOR SUCH TAXABLE YEAR IN
AN AMOUNT EQUAL TO SUCH CREDIT FOR SUCH TAXABLE YEAR. SUCH PAYMENT SHALL
BE TREATED AS AN OVERPAYMENT OF TAX TO BE REFUNDED AS SOON AS  PRACTICA-
BLE,  BUT  NOT  LONGER  THAN  FORTY-FIVE  DAYS FROM FILING A CLAIM FOR A
REFUND, IN ACCORDANCE WITH THE PROVISIONS OF SECTION SIX HUNDRED  EIGHT-
Y-SIX  OF THIS ARTICLE, PROVIDED, HOWEVER THAT NO INTEREST SHALL BE PAID
THEREON. ALL QUALIFIED TAXPAYERS MAY  SUBMIT  A  CLAIM  FOR  AN  ADVANCE
PAYMENT  OF  SUCH  REFUND  ON FORMS PREPARED BY THE DEPARTMENT, PROVIDED
SUCH  FORMS  ARE  FILED  WITH  THE  DEPARTMENT  ON  OR   BEFORE   AUGUST
THIRTY-FIRST, TWO THOUSAND THIRTEEN.
  (B)  THE  AMOUNT  OF THE CREDIT WHICH IS ALLOWED UNDER THIS SUBSECTION
FOR THE TAXPAYER'S TAXABLE YEAR BEGINNING IN TWO THOUSAND THIRTEEN SHALL
BE REDUCED BY THE PAYMENTS MADE TO THE TAXPAYER UNDER  THIS  SUBSECTION.
ANY FAILURE TO SO REDUCE THE CREDIT SHALL BE TREATED AS ARISING OUT OF A
MATHEMATICAL  OR CLERICAL ERROR AND ASSESSED ACCORDING TO SUBSECTION (D)
OF SECTION SIX HUNDRED EIGHTY-ONE OF THIS ARTICLE.
  (C) ANY FAILURE TO APPLY FOR AN ADVANCE PAYMENT  SHALL  NOT  IMPAIR  A
TAXPAYER'S  ABILITY TO APPLY FOR THE CREDIT UPON FILING THEIR RETURN FOR
SUCH TAX YEAR.
  (5) IF THE COMMISSIONER DETERMINES  IT  TO  BE  NECESSARY  FOR  PROPER
ADMINISTRATION  OF  THE CREDIT ALLOWED UNDER THIS SUBSECTION, THE COUNTY
DIRECTOR OF REAL PROPERTY TAX SERVICES OF ANY COUNTY, OR IN THE CASE  OF
A  CITY  WITH  A  POPULATION OF ONE MILLION OR MORE, THE COMMISSIONER OF
FINANCE, UPON THE REQUEST OF THE COMMISSIONER, SHALL FILE A REPORT  WITH
THE  DEPARTMENT  IDENTIFYING ALL PARCELS IN THE COUNTY OR IN THE CITY ON
WHICH SCHOOL TAXES FOR THE PRIOR SCHOOL YEAR REMAINED UNPAID AS OF  JUNE
THIRTIETH OF SUCH PRIOR SCHOOL YEAR, PROVIDED THAT PARCELS NOT RECEIVING
THE  BASIC  OR ENHANCED STAR EXEMPTION SHALL BE EXCLUDED FROM SUCH LIST.
SUCH COUNTY DIRECTOR SHALL OBTAIN FROM THE TAX COLLECTING  OFFICERS  AND
TAX ENFORCEMENT OFFICERS WITHIN THE COUNTY SUCH INFORMATION AS HE OR SHE
MAY  NEED  TO PREPARE SUCH LIST. SUCH LIST SHALL BE PREPARED IN A FORMAT
PRESCRIBED BY THE COMMISSIONER.
  (6) IF THE SCHOOL PROPERTY TAXES TO WHICH THE CREDIT RELATES  ARE  NOT
PAID,  THE  CREDIT  ALLOWED  WITH RESPECT TO SUCH PROPERTY TAXES MUST BE
ADDED BACK IN THE TAX YEAR IN WHICH SUCH CREDIT WAS CLAIMED.
  (7) ONLY ONE CREDIT PER RESIDENCE SHALL BE ALLOWED  PER  TAXABLE  YEAR
UNDER  THIS SUBSECTION. WHEN TWO OR MORE MEMBERS OF A RESIDENCE ARE ABLE
TO MEET THE QUALIFICATIONS FOR A QUALIFIED TAXPAYER, THE CREDIT SHALL BE
EQUALLY DIVIDED BETWEEN OR AMONG SUCH INDIVIDUALS.
  HUSBAND AND WIFE. IN THE CASE OF A HUSBAND AND WIFE WHO FILE  A  JOINT
FEDERAL  RETURN  BUT  WHO ARE REQUIRED TO DETERMINE THEIR NEW YORK TAXES
SEPARATELY, THE CREDIT  ALLOWED  PURSUANT  TO  THIS  SUBSECTION  MAY  BE
APPLIED  AGAINST  THE  TAX OF EITHER OR DIVIDED BETWEEN THEM AS THEY MAY
ELECT.
  S 4. This act shall take effect immediately.

                                 PART AA
                         Intentionally omitted.

S. 2609--C                         55

                                 PART BB
                         Intentionally omitted.

                                 PART CC

  Section  1.  Section  210  of  the  tax law is amended by adding a new
subdivision 23-a to read as follows:
  23-A. CREDIT FOR EMPLOYMENT OF  CERTAIN  VETERANS.  (A)  ALLOWANCE  OF
CREDIT. A TAXPAYER SHALL BE ALLOWED A CREDIT, TO BE COMPUTED AS PROVIDED
IN THIS SUBDIVISION, AGAINST THE TAX IMPOSED BY THIS ARTICLE, FOR HIRING
AND  EMPLOYING, FOR NOT LESS THAN ONE YEAR AND FOR NOT LESS THAN THIRTY-
FIVE HOURS EACH WEEK, A QUALIFIED VETERAN WITHIN THE STATE.
  (B) QUALIFIED VETERAN. A QUALIFIED VETERAN IS AN INDIVIDUAL:
  (1) WHO SERVED ON ACTIVE DUTY IN THE UNITED  STATES  ARMY,  NAVY,  AIR
FORCE,  MARINE CORPS, COAST GUARD OR THE RESERVES THEREOF, OR WHO SERVED
IN ACTIVE MILITARY SERVICE OF THE UNITED STATES AS A MEMBER OF THE  ARMY
NATIONAL  GUARD,  AIR  NATIONAL  GUARD, NEW YORK GUARD OR NEW YORK NAVAL
MILITIA; WHO WAS RELEASED FROM  ACTIVE  DUTY  BY  GENERAL  OR  HONORABLE
DISCHARGE AFTER SEPTEMBER ELEVENTH, TWO THOUSAND ONE;
  (2) WHO COMMENCES EMPLOYMENT BY THE QUALIFIED TAXPAYER ON OR AFTER MAY
FIRST,  TWO  THOUSAND  THIRTEEN,  AND  BEFORE  MAY  FIRST,  TWO THOUSAND
FIFTEEN;
  (3) WHO CERTIFIES BY SIGNED AFFIDAVIT, UNDER PENALTY OF PERJURY,  THAT
HE OR SHE HAS NOT BEEN EMPLOYED FOR THIRTY-FIVE OR MORE HOURS DURING ANY
WEEK  IN  THE  ONE HUNDRED EIGHTY DAY PERIOD IMMEDIATELY PRIOR TO HIS OR
HER EMPLOYMENT BY THE TAXPAYER; AND
  (4) WHO WAS NOT EMPLOYED BY THE TAXPAYER TO REPLACE ANOTHER EMPLOYEE.
  (C) AMOUNT OF CREDIT. THE AMOUNT OF THE CREDIT SHALL BE TEN PERCENT OF
THE WAGES PAID TO THE QUALIFIED VETERAN  PRIOR  TO  JANUARY  FIRST,  TWO
THOUSAND  FIFTEEN; PROVIDED, HOWEVER, THAT IF THE QUALIFIED VETERAN IS A
DISABLED VETERAN, AS DEFINED IN PARAGRAPH  (B)  OF  SUBDIVISION  ONE  OF
SECTION  EIGHTY-FIVE  OF THE CIVIL SERVICE LAW, THE AMOUNT OF THE CREDIT
SHALL BE FIFTEEN PERCENT OF THE WAGES  PAID  TO  THE  QUALIFIED  VETERAN
PRIOR TO MAY FIRST, TWO THOUSAND FIFTEEN. THE CREDIT ALLOWED PURSUANT TO
THIS SUBDIVISION SHALL NOT EXCEED, DURING ANY TAXABLE YEAR, TEN THOUSAND
DOLLARS  FOR  ANY QUALIFIED VETERAN AND FIFTEEN THOUSAND DOLLARS FOR ANY
QUALIFIED VETERAN WHO IS A DISABLED VETERAN.
  (D) CARRYOVER. THE CREDIT ALLOWED UNDER THIS SUBDIVISION FOR ANY TAXA-
BLE 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.
HOWEVER, IF THE AMOUNT OF CREDIT 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
THREE YEARS.
  S 2. 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 EMPLOYMENT         AMOUNT OF CREDIT
OF CERTAIN VETERANS UNDER            UNDER SUBDIVISION
SUBSECTION (A-2)                     TWENTY-THREE-A
                                     OF SECTION TWO
                                     HUNDRED TEN OR
                                     SUBSECTION (E-1)
                                     OF SECTION FOURTEEN

S. 2609--C                         56

                                     HUNDRED FIFTY-SIX
  S  3. Section 606 of the tax law is amended by adding a new subsection
(a-2) to read as follows:
  (A-2) CREDIT FOR EMPLOYMENT OF  CERTAIN  VETERANS.  (1)  ALLOWANCE  OF
CREDIT. A TAXPAYER SHALL BE ALLOWED A CREDIT, TO BE COMPUTED AS PROVIDED
IN  THIS SUBSECTION, AGAINST THE TAX IMPOSED BY THIS ARTICLE, FOR HIRING
AND EMPLOYING, FOR NOT LESS THAN ONE YEAR AND FOR NOT LESS THAN  THIRTY-
FIVE HOURS EACH WEEK, A QUALIFIED VETERAN WITHIN THE STATE.
  (2) QUALIFIED VETERAN. A QUALIFIED VETERAN IS AN INDIVIDUAL:
  (A)  WHO  SERVED  ON  ACTIVE DUTY IN THE UNITED STATES ARMY, NAVY, AIR
FORCE, MARINE CORPS, COAST GUARD OR THE RESERVES THEREOF, OR WHO  SERVED
IN  ACTIVE MILITARY SERVICE OF THE UNITED STATES AS A MEMBER OF THE ARMY
NATIONAL GUARD, AIR NATIONAL GUARD, NEW YORK GUARD  OR  NEW  YORK  NAVAL
MILITIA;  WHO  WAS  RELEASED  FROM  ACTIVE  DUTY BY GENERAL OR HONORABLE
DISCHARGE AFTER SEPTEMBER ELEVENTH, TWO THOUSAND ONE;
  (B) WHO COMMENCES EMPLOYMENT BY THE QUALIFIED TAXPAYER ON OR AFTER MAY
FIRST, TWO  THOUSAND  THIRTEEN,  AND  BEFORE  MAY  FIRST,  TWO  THOUSAND
FIFTEEN;
  (C)  WHO CERTIFIES BY SIGNED AFFIDAVIT, UNDER PENALTY OF PERJURY, THAT
HE OR SHE HAS NOT BEEN EMPLOYED FOR THIRTY-FIVE OR MORE HOURS DURING ANY
WEEK, IN THE ONE HUNDRED EIGHTY DAY PERIOD IMMEDIATELY PRIOR TO  HIS  OR
HER EMPLOYMENT BY THE TAXPAYER; AND
  (D) WHO WAS NOT EMPLOYED BY THE TAXPAYER TO REPLACE ANOTHER EMPLOYEE.
  (3) AMOUNT OF CREDIT. THE AMOUNT OF THE CREDIT SHALL BE TEN PERCENT OF
THE  WAGES  PAID  TO  THE  QUALIFIED VETERAN PRIOR TO JANUARY FIRST, TWO
THOUSAND FIFTEEN; PROVIDED, HOWEVER, THAT IF THE QUALIFIED VETERAN IS  A
DISABLED  VETERAN,  AS  DEFINED  IN  PARAGRAPH (B) OF SUBDIVISION ONE OF
SECTION EIGHTY-FIVE OF THE CIVIL SERVICE LAW, THE AMOUNT OF  THE  CREDIT
SHALL  BE  FIFTEEN  PERCENT  OF  THE WAGES PAID TO THE QUALIFIED VETERAN
PRIOR TO MAY FIRST, TWO THOUSAND FIFTEEN. THE CREDIT ALLOWED PURSUANT TO
THIS SUBSECTION SHALL NOT EXCEED, DURING ANY TAXABLE YEAR, TEN  THOUSAND
DOLLARS  FOR  ANY QUALIFIED VETERAN AND FIFTEEN THOUSAND DOLLARS FOR ANY
QUALIFIED VETERAN WHO IS A DISABLED VETERAN.
  (4) CARRYOVER. IF THE AMOUNT OF CREDIT ALLOWABLE UNDER THIS SUBSECTION
FOR ANY TAXABLE YEAR SHALL EXCEED THE TAXPAYER'S TAX FOR SUCH YEAR,  ANY
AMOUNT OF CREDIT NOT DEDUCTIBLE IN SUCH TAXABLE YEAR MAY BE CARRIED OVER
TO THE FOLLOWING THREE YEARS.
  S 4. Section 1456 of the tax law is amended by adding a new subsection
(e-1) to read as follows:
  (E-1)  CREDIT  FOR  EMPLOYMENT  OF  CERTAIN VETERANS. (1) ALLOWANCE OF
CREDIT. A TAXPAYER SHALL BE ALLOWED A CREDIT TO BE COMPUTED AS  PROVIDED
IN  THIS SUBSECTION, AGAINST THE TAX IMPOSED BY THIS ARTICLE, FOR HIRING
AND EMPLOYING, FOR NOT LESS THAN ONE YEAR AND FOR NOT LESS THAN  THIRTY-
FIVE HOURS EACH WEEK, A QUALIFIED VETERAN WITHIN THE STATE.
  (2) QUALIFIED VETERAN. A QUALIFIED VETERAN IS AN INDIVIDUAL:
  (A)  WHO  SERVED  ON  ACTIVE DUTY IN THE UNITED STATES ARMY, NAVY, AIR
FORCE, MARINE CORPS, COAST GUARD OR THE RESERVES THEREOF, OR WHO  SERVED
IN  ACTIVE MILITARY SERVICE OF THE UNITED STATES AS A MEMBER OF THE ARMY
NATIONAL GUARD, AIR NATIONAL GUARD, NEW YORK GUARD  OR  NEW  YORK  NAVAL
MILITIA;  WHO  WAS  RELEASED  FROM  ACTIVE  DUTY BY GENERAL OR HONORABLE
DISCHARGE AFTER SEPTEMBER ELEVENTH, TWO THOUSAND ONE;
  (B) WHO COMMENCES EMPLOYMENT BY THE QUALIFIED TAXPAYER ON OR AFTER MAY
FIRST, TWO  THOUSAND  THIRTEEN,  AND  BEFORE  MAY  FIRST,  TWO  THOUSAND
FIFTEEN;
  (C)  WHO CERTIFIES BY SIGNED AFFIDAVIT, UNDER PENALTY OR PERJURY, THAT
HE OR SHE HAS NOT BEEN EMPLOYED FOR THIRTY-FIVE OR MORE HOURS DURING ANY

S. 2609--C                         57

WEEK IN THE ONE HUNDRED EIGHTY DAY PERIOD IMMEDIATELY PRIOR  TO  HIS  OR
HER EMPLOYMENT BY THE TAXPAYER; AND
  (D) WHO WAS NOT EMPLOYED BY THE TAXPAYER TO REPLACE ANOTHER EMPLOYEE.
  (3) AMOUNT OF CREDIT. THE AMOUNT OF THE CREDIT SHALL BE TEN PERCENT OF
THE  WAGES  PAID  TO  THE  QUALIFIED VETERAN PRIOR TO JANUARY FIRST, TWO
THOUSAND FIFTEEN; PROVIDED, HOWEVER, THAT IF THE QUALIFIED VETERAN IS  A
DISABLED  VETERAN,  AS  DEFINED  IN  PARAGRAPH (B) OF SUBDIVISION ONE OF
SECTION EIGHTY-FIVE OF THE CIVIL SERVICE LAW, THE AMOUNT OF  THE  CREDIT
SHALL  BE  FIFTEEN  PERCENT  OF  THE WAGES PAID TO THE QUALIFIED VETERAN
PRIOR TO MAY FIRST, TWO THOUSAND FIFTEEN. THE CREDIT ALLOWED PURSUANT TO
THIS SUBSECTION SHALL NOT EXCEED, DURING ANY TAXABLE YEAR, TEN  THOUSAND
DOLLARS  FOR  ANY QUALIFIED VETERAN AND FIFTEEN THOUSAND DOLLARS FOR ANY
QUALIFIED VETERAN WHO IS A DISABLED VETERAN.
  (4) CARRYOVER. THE CREDIT ALLOWED UNDER THIS SUBSECTION FOR ANY  TAXA-
BLE  YEAR  SHALL  NOT  REDUCE THE TAX DUE FOR SUCH YEAR TO LESS THAN THE
MINIMUM  TAX  FIXED  BY  SUBSECTION  (B)  OF  SECTION  FOURTEEN  HUNDRED
FIFTY-FIVE  OF  THIS ARTICLE. HOWEVER, IF THE AMOUNT OF CREDIT ALLOWABLE
UNDER THIS SUBSECTION 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 THREE YEARS.
  S 5. Section 1511 of the tax law is amended by adding a  new  subdivi-
sion (g-1) to read as follows:
  (G-1)  CREDIT  FOR  EMPLOYMENT  OF  CERTAIN VETERANS. (1) ALLOWANCE OF
CREDIT. A TAXPAYER SHALL BE ALLOWED A CREDIT TO BE COMPUTED AS  PROVIDED
IN THIS SUBDIVISION, AGAINST THE TAX IMPOSED BY THIS ARTICLE, FOR HIRING
AND  EMPLOYING, FOR NOT LESS THAN ONE YEAR AND FOR NOT LESS THAN THIRTY-
FIVE HOURS EACH WEEK, A QUALIFIED VETERAN WITHIN THE STATE.
  (2) QUALIFIED VETERAN. A QUALIFIED VETERAN IS AN INDIVIDUAL:
  (A) WHO SERVED ON ACTIVE DUTY IN THE UNITED  STATES  ARMY,  NAVY,  AIR
FORCE,  MARINE CORPS, COAST GUARD OR THE RESERVES THEREOF, OR WHO SERVED
IN THE ACTIVE MILITARY SERVICE OF THE UNITES STATES AS A MEMBER  OF  THE
ARMY  NATIONAL  GUARD,  AIR  NATIONAL  GUARD, NEW YORK GUARD OR NEW YORK
NAVAL MILITIA; WHO WAS RELEASED FROM ACTIVE DUTY BY GENERAL OR HONORABLE
DISCHARGE AFTER SEPTEMBER ELEVENTH, TWO THOUSAND ONE;
  (B) WHO COMMENCES EMPLOYMENT BY THE QUALIFIED TAXPAYER ON OR AFTER MAY
FIRST, TWO  THOUSAND  THIRTEEN,  AND  BEFORE  MAY  FIRST,  TWO  THOUSAND
FIFTEEN;
  (C)  WHO CERTIFIES BY SIGNED AFFIDAVIT, UNDER PENALTY OF PERJURY, THAT
HE OR SHE HAS NOT BEEN EMPLOYED FOR THIRTY-FIVE OR MORE HOURS DURING ANY
WEEK IN THE ONE HUNDRED EIGHTY DAY PERIOD IMMEDIATELY PRIOR  TO  HIS  OR
HER EMPLOYMENT BY THE TAXPAYER; AND
  (D) WHO WAS NOT EMPLOYED BY THE TAXPAYER TO REPLACE ANOTHER EMPLOYEE.
  (3) AMOUNT OF CREDIT. THE AMOUNT OF THE CREDIT SHALL BE TEN PERCENT OF
THE  WAGES  PAID  TO  THE  QUALIFIED VETERAN PRIOR TO JANUARY FIRST, TWO
THOUSAND FIFTEEN; PROVIDED, HOWEVER, THAT IF THE QUALIFIED VETERAN IS  A
DISABLED  VETERAN,  AS  DEFINED  IN  PARAGRAPH (B) OF SUBDIVISION ONE OF
SECTION EIGHTY-FIVE OF THE CIVIL SERVICE LAW, THE AMOUNT OF  THE  CREDIT
SHALL  BE  FIFTEEN  PERCENT  OF  THE WAGES PAID TO THE QUALIFIED VETERAN
PRIOR TO MAY FIRST, TWO THOUSAND FIFTEEN. THE CREDIT ALLOWED PURSUANT TO
THIS SUBDIVISION SHALL NOT EXCEED, DURING ANY TAXABLE YEAR, TEN THOUSAND
DOLLARS FOR ANY QUALIFIED VETERAN AND FIFTEEN THOUSAND DOLLARS  FOR  ANY
QUALIFIED VETERAN WHO IS A DISABLED VETERAN.
  (4) CARRYOVER. THE CREDIT ALLOWED UNDER THIS SUBDIVISION FOR ANY TAXA-
BLE  YEAR  SHALL  NOT  REDUCE THE TAX DUE FOR SUCH YEAR TO LESS THAN THE
MINIMUM TAX FIXED BY  PARAGRAPH  FOUR  OF  SUBDIVISION  (A)  OF  SECTION
FIFTEEN  HUNDRED  TWO  OF THIS ARTICLE. HOWEVER, IF THE AMOUNT OF CREDIT

S. 2609--C                         58

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 THREE YEARS.
  S  6.  This  act  shall take effect immediately and shall be deemed to
have been in full force and effect on and after January 1, 2013.

                                 PART DD

  Section 1. Subdivision 3 of section 353 of  the  economic  development
law,  as  amended  by  section  2 of part G of chapter 61 of the laws of
2011, is amended to read as follows:
  3. For the purposes of this article, in order to  participate  in  the
excelsior  jobs  program,  a  business entity operating predominantly in
manufacturing must create at least [twenty-five] TEN  net  new  jobs;  a
business  entity  operating  predominately in agriculture must create at
least [ten] FIVE net new jobs; a business entity operating predominantly
as a financial service data center or financial services  customer  back
office  operation must create at least [one hundred] FIFTY net new jobs;
a business entity operating predominantly  in  scientific  research  and
development  must  create  at  least [ten] FIVE net new jobs; a business
entity operating predominantly in software development  must  create  at
least  [ten]  FIVE net new jobs; a business entity creating or expanding
back office operations MUST CREATE AT LEAST FIFTY NET  NEW  JOBS;  or  A
BUSINESS  ENTITY OPERATING PREDOMINATELY AS a distribution center in the
state must create at least [one  hundred  fifty]  SEVENTY-FIVE  net  new
jobs,  notwithstanding  subdivision  five of this section; or a business
entity must be a regionally significant project as defined in this arti-
cle; or
  S 2. Subdivision 2 of section 355 of the economic development law,  as
amended  by  section  4  of part G of chapter 61 of the laws of 2011, is
amended to read as follows:
  2. Excelsior investment tax credit component.  A  participant  in  the
excelsior  jobs program shall be eligible to claim a credit on qualified
investments. The credit shall be equal to [two] FIVE percent of the cost
or other basis for federal income tax purposes of the qualified  invest-
ment.    A  participant  may not claim both the excelsior investment tax
credit component and the investment tax credit set forth in  subdivision
twelve of section two hundred ten, subsection (a) of section six hundred
six,  subsection  (i) of section fourteen hundred fifty-six, or subdivi-
sion (q) of section fifteen hundred eleven of the tax law for  the  same
property  in  any taxable year, except that a participant may claim both
the excelsior investment tax credit component  and  the  investment  tax
credit  for  research  and development property. In addition, a taxpayer
who or which is qualified to claim the excelsior investment  tax  credit
component and is also qualified to claim the brownfield tangible proper-
ty  credit  component  under section twenty-one of the tax law may claim
either the excelsior investment tax credit component  or  such  tangible
property  credit  component,  but  not  both with regard to a particular
piece of property. A credit may not be claimed until a  business  enter-
prise  has received a certificate of tax credit, provided that qualified
investments made on or after the issuance of the certificate  of  eligi-
bility  but  before the issuance of the certificate of tax credit to the
business enterprise, may be claimed in the first taxable year for  which
the  business  enterprise  is  allowed  to  claim  the  credit. Expenses
incurred prior to the date the certificate of eligibility is issued  are
not eligible to be included in the calculation of the credit.

S. 2609--C                         59

  S  3. Subdivision 4 of section 355 of the economic development law, as
amended by section 4 of part G of chapter 61 of the  laws  of  2011,  is
amended to read as follows:
  4.  Excelsior real property tax credit component. (a) A participant in
the excelsior jobs program who either qualified as a regionally  signif-
icant  project  or  is  located  in [an investment zone] AN ECONOMICALLY
DISTRESSED AREA shall be eligible to claim a credit for a period of  ten
years.
  (b)  The  credit  in  year  one shall be equal to fifty percent of the
eligible real  property  taxes  on  the  real  property  comprising  the
regionally  significant  project  or  located  in  the [investment zone]
ECONOMICALLY DISTRESSED AREA.  In the remaining years the  credit  shall
be computed according to the following schedule:
  Year  two:  forty-five  percent of eligible real property taxes on the
real property comprising the regionally significant project  or  located
in the [investment zone] ECONOMICALLY DISTRESSED AREA;
  Year  three: forty percent of eligible real property taxes on the real
property comprising the regionally significant project or located in the
[investment zone] ECONOMICALLY DISTRESSED AREA;
  Year four: thirty-five percent of eligible real property taxes on real
property comprising the regionally significant project or located in the
[investment zone] ECONOMICALLY DISTRESSED AREA;
  Year five: thirty percent of eligible real property taxes on the  real
property comprising the regionally significant project or located in the
[investment zone] ECONOMICALLY DISTRESSED AREA;
  Year  six:  twenty-five percent of eligible real property taxes on the
real property comprising the regionally significant project  or  located
in the [investment zone] ECONOMICALLY DISTRESSED AREA;
  Year seven: twenty percent of eligible real property taxes on the real
property comprising the regionally significant project or located in the
[investment zone] ECONOMICALLY DISTRESSED AREA;
  Year  eight:  fifteen  percent  of eligible real property taxes on the
real property comprising the regionally significant project  or  located
in the [investment zone] ECONOMICALLY DISTRESSED AREA;
  Year  nine:  ten  percent  of eligible real property taxes on the real
property comprising the regionally significant project or located in the
[investment zone] ECONOMICALLY DISTRESSED AREA; and
  Year ten: five percent of eligible real property  taxes  on  the  real
property comprising the regionally significant project or located in the
[investment zone] ECONOMICALLY DISTRESSED AREA.
  (c)  For  purposes  of  this  credit, the term "eligible real property
taxes" shall have the same meaning as  in  subdivision  (e)  of  section
fifteen of the tax law, provided that such subdivision (e) shall be read
as  if it specifically referenced the excelsior jobs program and partic-
ipants in that program.
  (d) In calculating the excelsior real property tax credit  and  deter-
mining  the  maximum  aggregate  amount  of such credit component in the
preliminary schedule of benefits, the  commissioner  shall  include  any
improvements  projected  to  be  made  by  the  taxpayer to the property
comprising the regionally significant project or located in the [invest-
ment zone] ECONOMICALLY DISTRESSED AREA as listed in its application for
participation in the excelsior jobs program.
  S 4. Subdivision 4 of section 354 of the economic development law,  as
amended  by  section 3 of part G of the laws of 2011, is amended to read
as follows:

S. 2609--C                         60

  4. In order to become a participant in the program, an applicant  must
submit  evidence that it satisfies the eligibility criteria specified in
section three hundred fifty-three of this article and subdivision two of
this section in such form  as  the  commissioner  may  prescribe.  After
reviewing  such evidence and finding it sufficient, the department shall
certify the applicant as a participant and issue to that  participant  a
certificate of tax credit for one taxable year. To receive a certificate
of  tax credit for subsequent taxable years, the participant must submit
to the department a performance report demonstrating  that  the  partic-
ipant continues to satisfy the eligibility criteria specified in section
three  hundred  fifty-three  of this article and subdivision two of this
section. If such eligibility criteria is met, a participant can  receive
tax credits based on interim job, investment or research and development
milestones.  A  participant's  increase in employment, qualified invest-
ment, or federal research and development  tax  credit  attributable  to
research  and development activities in New York state above its projec-
tions listed in its application shall not result in an increase  in  tax
benefits  under this article. However, if the participant's expenditures
are less than the estimated amounts, the credit shall be less  than  the
estimate.    IF,  IN ANY GIVEN YEAR, A PARTICIPANT WHO HAS SATISFIED THE
ELIGIBILITY CRITERIA SPECIFIED IN SECTION THREE HUNDRED  FIFTY-THREE  OF
THIS  ARTICLE  REALIZES JOB CREATION LESS THAN THE ESTIMATED AMOUNT, THE
CREDIT SHALL BE REDUCED BY THE PROPORTION OF ACTUAL JOB CREATION TO  THE
ESTIMATED  AMOUNT,  PROVIDED  THE  PROPORTION  IS  AT LEAST SEVENTY-FIVE
PERCENT OF THE JOBS ESTIMATED.
  S 5. Section 359 of  the  economic  development  law,  as  amended  by
section  6  of  part  G of chapter 61 of the laws of 2011, is amended to
read as follows:
  S 359. Cap on tax credit. The total amount of tax  credits  listed  on
certificates  of  tax  credit issued by the commissioner for any taxable
year may not exceed the limitations  set  forth  in  this  section.  Any
amount  of tax credits not awarded for a particular taxable year may not
be used by the commissioner to award  tax  credits  in  another  taxable
year.

Credit components in the aggregate           With respect to taxable
shall not exceed:                            years beginning in:

          $ 50 million                               2011
          $ 100 million                              2012
          $ [150] 170 million                        2013
          $ [200] 240 million                        2014
          $ [250] 310 million                        2015
          $ [200] 260 million                        2016
          $ [200] 260 million                        2017
          $ [200] 260 million                        2018
          $ [200] 260 million                        2019
          $ [200] 260 million                        2020
          $ [200] 260 million                        2021
          $ [150] 210 million                        2022
          $ [100] 140 million                        2023
          $ [50] 70 million                          2024

  Twenty-five  percent  of  tax credits shall be allocated to businesses
accepted into the  program  under  subdivision  four  of  section  three
hundred  fifty-three  of  this  article  and seventy-five percent of tax

S. 2609--C                         61

credits shall be allocated to businesses accepted into the program under
subdivision three of section three hundred fifty-three of this article.
  Provided,  however,  if by September thirtieth of a calendar year, the
department has not allocated the full amount  of  credits  available  in
that  year  to  either:  (i)  businesses accepted into the program under
subdivision four of section three hundred fifty-three of this article or
(ii) businesses accepted into the program  under  subdivision  three  of
section  three hundred fifty-three of this article, the commissioner may
allocate any remaining tax credits to  businesses  referenced  in  para-
graphs  (i)  and (ii) of this section as needed; provided, however, that
under no circumstances may the statutory cap be exceeded.
  S 6. This act shall take effect immediately.

                                 PART EE
                         Intentionally omitted.

                                 PART FF

  Section 1. Legislative findings and  intent.  The  legislature  hereby
finds and declares that the path to prosperity and the economic recovery
of New York state lies in job creation and in broadening economic choice
and  career  opportunities  for  all  citizens  of  this state, and that
achieving these goals can be  accelerated  by  the  enhancement  of  the
state's  innovation and entrepreneurial spirit via the growth and devel-
opment of business  incubator  programs  that  provide  entrepreneurial,
economic, and business development support and resources.
  The  legislature  further  finds that the goal and purpose of business
incubation programs that include physical space  or  are  virtual  incu-
bation  programs  is  to  develop financially stable successful firms by
providing a comprehensive array of entrepreneurial supports,  resources,
and  services,  including  management  guidance,  technical  assistance,
consulting, mentoring, education, networking  opportunities,  access  to
capital  and  markets,  tailored to the individual needs of the business
entities being incubated.
  The legislature further finds that the concept of business  incubation
and  business  development  programs originated in New York in 1959 when
Joseph Mancuso opened the Batavia Industrial Center in a Batavia factory
building, a concept that has since spread from New York  throughout  the
country  and  the  world,  to the extent that there are now an estimated
1,400 incubators in North America, and 7,000 in the world.
  The legislature further finds that it  has  been  conclusively  demon-
strated  that  firms  originating  and  graduating from a New York state
incubator program have a markedly better  chance  of  remaining  in  and
expanding  employment  opportunities in New York state compared to firms
that begin outside an incubator environment, that entrepreneurial  coun-
seling  and  mentoring has a significant positive effect on firm growth,
development, and sustainability, and that research has  shown  that  the
success  of  business incubation programs and the resulting intensifica-
tion of the entrepreneurial ethos  in  an  area  can  often  rise  above
regional economic conditions, so long as high level in-incubator factors
are  maintained,  such as qualified staff, program comprehensiveness and
integration, adherence to best practices, the extent of participation by
client entrepreneurs in the program, and the vitality and composition of
the advisory board.

S. 2609--C                         62

  The legislature  further  finds  that  these  important  programs  are
supported  by  a mixed variety of local sponsorships, public and private
foundation grants, rental and program fee revenues, and other sources of
funds, many of them short-term and unstable, and that  such  instability
can act as a barrier that stifles the ability of the business incubation
program  to  meet  its  goals  and  achieve maximum effectiveness in job
creation and economic impact.
  The legislature further declares that any incubator support program to
be successful shall require metrics of incubators that requires that  in
order  to  retain designation, such incubators must provide evidence for
evaluation of the relative success of their programs, allow for  compar-
ison  of  program  effectiveness  to  other programs similarly composed,
targeted, and situated, provide evidence of program and service quality,
demonstrate the value provided to clients, demonstrate continued  imple-
mentation  of  best  practices, and assure that the program continues to
meet the requirements for designation.
  The legislature therefore declares that it is in every respect  appro-
priate public policy to provide support for incubators in New York, as a
means  of  increasing economic opportunity and choice to the citizens of
this state, maintaining high  standards  for  incubation  programs,  and
building and expanding the economy of this state.
  S  2.  Section  1 of chapter 174 of the laws of 1968, constituting the
New York state urban development corporation act, is amended by adding a
new section 16-v to read as follows:
  S 16-V. NEW YORK STATE BUSINESS INCUBATOR SUPPORT  ACT.  1.  NEW  YORK
STATE  INCUBATORS.  THE  CORPORATION  SHALL  DESIGNATE PROGRAMS WHICH ON
APPLICATION MEET THE REQUIREMENTS OF SUBDIVISION TWO OF THIS SECTION  AS
NEW  YORK  STATE  INCUBATORS,  AND  SHALL  PROVIDE  SUPPORT AND SERVICES
DESCRIBED IN THIS SECTION OR WHICH AS MAY OTHERWISE BE AVAILABLE BY  AND
THROUGH  THE  CORPORATION  OR,  ASSISTED BY THE COMMISSIONER OF ECONOMIC
DEVELOPMENT AND IN CONSULTATION WITH THE DEPARTMENT OF ECONOMIC DEVELOP-
MENT, BY AND THROUGH THE DEPARTMENT OF ECONOMIC DEVELOPMENT.  "NEW  YORK
STATE  INCUBATOR"  SHALL  MEAN  A BUSINESS INCUBATION PROGRAM WHICH ALSO
PROVIDES PHYSICAL SPACE OR WHICH IS A VIRTUAL  INCUBATION  PROGRAM  THAT
HAS  BEEN  DESIGNATED  UPON APPLICATION BY THE CORPORATION AS A NEW YORK
STATE INCUBATOR PURSUANT TO  THIS  SECTION  AND  WHICH  THEREBY  BECOMES
ELIGIBLE  FOR BENEFITS, SUPPORT, SERVICES, AND PROGRAMS AVAILABLE PURSU-
ANT TO SUCH DESIGNATION.
  2. REQUIREMENTS FOR DESIGNATION. A PROGRAM WISHING TO BE DESIGNATED AS
A NEW YORK STATE INCUBATOR PURSUANT TO THIS SECTION SHALL HAVE  BEEN  IN
EXISTENCE  AS  A PROGRAM WITH, IN, OR AS THE CURRENT ORGANIZATION FOR, A
PERIOD OF AT LEAST THREE FISCAL YEARS PRIOR TO THE CURRENT FISCAL  YEAR,
OR  DEMONSTRATE  CONTINUITY  OF STAFFING, PROGRAM, AND PURPOSE SHOWING A
CONTINUATION OF THE PROGRAM THROUGH ANOTHER AUSPICE OR GOVERNING ENTITY,
AND SHALL PROVIDE THE FOLLOWING IN A MANNER  PRESCRIBED  BY  THE  CORPO-
RATION:
  (A)  UNLESS  OTHERWISE STATED, FOR THE CURRENT AND TWO PREVIOUS FISCAL
YEARS THE PROGRAM PROVIDES, POSSESSES, OR HAS DEVELOPED AT LEAST  TWELVE
OF  THE FOLLOWING PROGRAMS, SERVICES, AND ATTRIBUTES, INCLUDING SUBPARA-
GRAPH (XIII) OF THIS  PARAGRAPH  REGARDING  STABILITY  AND  SUPPORT  AND
SUBPARAGRAPH (XVIII) OF THIS PARAGRAPH REGARDING THE STRATEGIC PLAN:
  (I)  AN  INTEGRATED  ARRAY OF SERVICES WHICH INCLUDES MANAGEMENT GUID-
ANCE, TECHNICAL ASSISTANCE, CONSULTING, MENTORING, BUSINESS PLAN  DEVEL-
OPMENT, AID IN CREATION OF THE BUSINESS ENTITY, AND ONGOING COUNSELING;

S. 2609--C                         63

  (II)  ENTREPRENEURIAL  EDUCATION OF AT LEAST THIRTY HOURS OF CLASSROOM
INSTRUCTION AND TEN HOURS OF TECHNICAL ASSISTANCE, OR THE EQUIVALENT  IN
INDIVIDUALIZED COUNSELING AND MENTORING SERVICES FOR CLIENTS;
  (III)  OPPORTUNITIES  FOR  CLIENTS  TO NETWORK, COLLABORATE WITH OTHER
BUSINESS PROGRAMS, AND GAIN ACCESS TO SERVICES, INCLUDING  THROUGH  SUCH
PROGRAMS  AS  THE  SMALL  BUSINESS DEVELOPMENT CENTER, THE LOCAL OR AREA
CHAMBER OF COMMERCE OR OTHER BUSINESS ASSOCIATION, PROGRAMS OF THE SMALL
BUSINESS ADMINISTRATION, AND/OR OTHER  SIMILAR  BUSINESS  ORGANIZATIONS,
ASSOCIATIONS, AND PROGRAMS;
  (IV)  ACCESS TO CAPITAL VIA REFERRAL OR OTHER ARRANGEMENTS WITH FINAN-
CIAL INSTITUTIONS,  VENTURE  CAPITALISTS,  ANGEL  INVESTORS,  INVESTMENT
FUNDS  MANAGED OR FINANCED BY STATE OR LOCAL ECONOMIC DEVELOPMENT ORGAN-
IZATIONS, OR OTHER SIMILAR OR EQUIVALENT CAPITAL SOURCES,  EVIDENCED  BY
WRITTEN  AGREEMENTS, MEMORANDUMS OF UNDERSTANDING, LETTERS OF INTENT, OR
OTHER ENDORSEMENTS ACCEPTABLE TO THE CORPORATION, AND INCLUDING READYING
CLIENTS FOR THE FINANCIAL MEETINGS AND INTERVIEWS;
  (V) AID IN ACCESSING MARKETS, VIA BID ASSISTANCE  OR  ACCESS  PROGRAMS
THAT MAY INCLUDE BUT ARE NOT LIMITED TO LITERATURE REVIEW, ESTABLISHMENT
OF  A RESOURCE DOCUMENTS ROOM (PHYSICAL OR VIRTUAL), OPPORTUNITY NOTIFI-
CATION OF LOCAL, STATE, AND FEDERAL GOVERNMENTAL  AND  PRIVATE  OPPORTU-
NITIES,  AND  IDENTIFICATION  OF  AND  INTRODUCTIONS  TO POTENTIAL FIRST
CUSTOMERS;
  (VI) PHYSICAL OFFICE SPACE AND/OR LABORATORY SPACE AND/OR  MANUFACTUR-
ING  SPACE  UNDER  A  WRITTEN  AGREEMENT FOR A PERIOD NOT TO EXCEED FIVE
YEARS FOR ANY INDIVIDUAL INCUBATOR CLIENT,  PROVIDED  THAT  THE  AVERAGE
PERIOD  DURING  WHICH  SPACE  IS PROVIDED FOR ALL SUCH CLIENTS ACCESSING
SPACE SHALL NOT EXCEED THREE YEARS;
  (VII) POLICIES REQUIRING PARTICIPATION BY  CLIENTS  IN  THE  INCUBATOR
PROGRAM,  INCLUDING  DISQUALIFICATION OR SUSPENSION FROM THE PROGRAM FOR
FAILURE TO PARTICIPATE;
  (VIII) CRITERIA FOR GRADUATION FROM THE PROGRAM OR PHYSICAL SPACE, AND
TERMS AND CONDITIONS FOR ONGOING  RELATIONSHIPS,  IF  ANY,  BETWEEN  THE
INCUBATOR AND THE CLIENT;
  (IX)  AT  LEAST  FIFTY  PERCENT OF THE TOTAL INCUBATOR BUDGET PROVIDED
FROM SOURCES OTHER THAN TENANT RENTS AND FEES AND IN-KIND  SUPPORT  FROM
THE  SPONSORING  ENTITY,  MUST BE FROM SOURCES OTHER THAN NEW YORK STATE
GOVERNMENT AGENCIES;
  (X) AN  INDEPENDENT  COMMUNITY-BASED  BOARD  OR  ADVISORY  BOARD  THAT
INCLUDES  ONE  OR  MORE  EXECUTIVE OFFICERS OF FIRMS THAT HAVE GRADUATED
FROM THE INCUBATOR, AND ONE OR MORE PROFESSIONALS IN ONE OF THE  FOLLOW-
ING  AREAS:  ACCOUNTING,  INTELLECTUAL PROPERTY, LAW (BUSINESS OR CORPO-
RATE), OR ECONOMIC DEVELOPMENT;
  (XI) AN INDEPENDENT ADVISORY COUNCIL OR RELATED NETWORK THAT  INCLUDES
ONE  OR  MORE  EXECUTIVE  OFFICERS OF FIRMS THAT HAVE GRADUATED FROM THE
INCUBATOR, AND INDIVIDUALS WITH EXPERTISE IN AREAS  APPROPRIATE  TO  THE
SECTOR  OR  CONCENTRATION  OF  CLIENTS,  AND THE MISSION AND GOAL OF THE
INCUBATOR;
  (XII) A PROFESSIONAL MANAGEMENT AND SERVICE DELIVERY TEAM WITH EXPERI-
ENCE, EXPERTISE, OR CREDENTIALS IN MANAGEMENT,  ENTREPRENEURSHIP,  BUSI-
NESS DEVELOPMENT, OR OTHER EQUIVALENT AREAS;
  (XIII)  INSTITUTIONAL STABILITY AND LONG TERM VIABILITY, INDICATED BY:
THE SPONSOR'S COMMITMENT TO FINANCIALLY  AND  PROGRAMMATICALLY  MAINTAIN
THE  INCUBATOR  FOR AT LEAST TWO YEARS IN ADDITION TO THE CURRENT FISCAL
YEAR; RECEIPT OF AT LEAST TWO NON-STATE PUBLIC AND PRIVATE GRANT  AND/OR
OTHER  REVENUE  SOURCES INCLUDING PROPERTY RENTALS AND PROGRAM FEES THAT
ARE OR HAVE PROVEN TO BE PREDICTABLE AND RELIABLE; AND  MANAGEABLE  DEBT

S. 2609--C                         64

SERVICE  NOT EXCEEDING AN AVERAGE OF TWENTY-FIVE PERCENT OF TOTAL BUDGET
(EXCLUSIVE OF ANY IN-YEAR CASH ADVANCES AGAINST PROGRAM OR GRANT  REVEN-
UES);
  (XIV)  A  LIMITATION  TO TWENTY PERCENT OR LESS OF THE TOTAL INCUBATOR
BUDGET FOR ADMINISTRATIVE COSTS, WHICH INCLUDES ONLY THAT PORTION OF THE
SALARIES AND BENEFITS OF THE CHIEF  EXECUTIVE  OFFICER,  ANY  DEPUTY  OR
ASSISTANT  TO THE CHIEF EXECUTIVE OFFICER, AND THE CHIEF FINANCIAL OFFI-
CER OR CONTROLLER, WHICH CANNOT BE ATTRIBUTED TO  PROGRAMS  OR  SERVICES
FUNDED  FROM  NON-STATE  REVENUES OR NOT OTHERWISE PAID BY THE INCUBATOR
SPONSOR FROM ITS OWN SOURCES;
  (XV)  ACCESS  BY  CLIENTS  TO  MENTORING,  ADVISORY,  OR   EDUCATIONAL
SERVICES,   INCLUDING  CLASSROOM  TEACHING,  FROM  INDIVIDUALS  WHO  ARE
LAWYERS, PROFESSIONAL ACCOUNTANTS, OR INDIVIDUALS WHO HAVE BEEN IN BUSI-
NESS AT AN EXECUTIVE LEVEL FOR AT LEAST FIVE YEARS;
  (XVI) A WRITTEN  OR  OTHERWISE  DEMONSTRABLE  CONNECTION  TO  REGIONAL
SOURCES  OF  INNOVATION  AND  EXPERTISE  OR  SOURCES OF HUMAN RESOURCES,
INCLUDING BUT NOT LIMITED TO A COLLEGE  OR  UNIVERSITY,  AN  INDEPENDENT
RESEARCH  INSTITUTION, A BUSINESS ASSOCIATION, OR TO EMPLOYEES, MEMBERS,
OR GRADUATES FROM ANY OF SUCH SOURCES, AND THE PROGRAMS OR ACTIVITIES BY
WHICH SUCH SOURCES CAN AND HAVE PROCURED OR PROVIDED SERVICES AND EXPER-
TISE TO ADVANCE CLIENT DEVELOPMENT;
  (XVII) EVIDENCE THAT THE INCUBATOR  IS  A  CENTER  OF  ENTREPRENEURIAL
ACTIVITIES  OF  A  CITY, REGION, OR DISTRESSED PORTION THEREOF, AS DOCU-
MENTED BY PROGRAMS AND  ACTIVITIES  COORDINATED  WITH  COUNTY  OR  LOCAL
ECONOMIC  DEVELOPMENT  ORGANIZATIONS,  INVESTOR  AND  FINANCIAL CLUBS OR
INSTITUTIONS, OR STUDENT OR YOUTH-ORIENTED  ENTREPRENEURIAL  ACTIVITIES.
FOR PURPOSES OF THIS PARAGRAPH, DISTRESS MAY BE DEMONSTRATED BY LOCATION
OF  THE  PROGRAM  OR ITS CLIENTS IN A FEDERAL HISTORICALLY UNDERUTILIZED
BUSINESS ZONE (HUB ZONE) OR EMPOWERMENT ZONE, AN AREA THAT IS OR  WAS  A
NEW  YORK  STATE  EMPIRE ZONE, OR CENSUS DATA DEMONSTRATING LOWER MEDIAN
INCOME AND EMPLOYMENT, AND HIGHER POVERTY THAN IN THE SURROUNDING COMMU-
NITIES WITHIN THE COUNTY OR CITY, PLUS LOWER ACCESS TO CAPITAL, BUSINESS
FORMATION STATISTICS, AND OTHER SIMILAR FACTORS; AND
  (XVIII) A STRATEGIC PLAN THAT DESCRIBES THE  IMPACT  ON  THE  REGIONAL
ENTREPRENEURIAL  ECOSYSTEM  THAT  THE  INCUBATOR IS INTENDED TO HAVE AND
COMMITS THE INCUBATOR TO  BEST  INCUBATION  PRACTICES  AND  DESCRIBES  A
DEFINED PROCESS THAT ACCELERATES COMMERCIALIZATION AND DEVELOPMENT FOR A
CLIENT  COMPANY  OR  ENTITY  THROUGH  PROVISION OF TECHNICAL ASSISTANCE,
DIRECT MENTORSHIP, ENTREPRENEURIAL EDUCATION, AND  BUSINESS  DEVELOPMENT
SERVICES, INCLUDING DEVELOPMENT OF A BUSINESS PLAN AND MARKETS, DEVELOP-
MENT  OF  THE MANAGEMENT TEAM AND AID IN DEVELOPMENT OF PRODUCT, CUSTOM-
ERS, AND LOCAL OR REGIONAL SUPPLY CHAIN PARTNERS, ACCESS TO  INVESTMENT,
AND LAUNCHING OF A SUCCESSFUL BUSINESS WHICH WILL EMPLOY NEW YORKERS;
  (B)  ANNUALLY DEMONSTRATE THAT IT MEETS THE GOALS OF CREATING JOBS AND
INCUBATING BUSINESSES WITH SURVIVAL RATES IN EXCESS OF AVERAGE STARTUPS,
AND THAT THE PROGRAM HAS A STRATEGIC PLAN TO CONTINUE TO MEET SUCH GOALS
FOR THE THREE YEARS SUCCEEDING DESIGNATION AND THAT COMMITS THE  PROGRAM
TO  IMPLEMENTING  BEST  PRACTICES.  SUCH  DEMONSTRATION  SHALL INCLUDE A
COMMITMENT BY THE SPONSOR TO CONTINUE TO MAINTAIN  THE  PROGRAM  FOR  AT
LEAST  THREE  YEARS  AFTER  SUCH DESIGNATION. PROGRAMS SHALL PROVIDE THE
FOLLOWING DATA FOR: (I) THE PROGRAM YEAR JUST COMPLETED, (II) THE  ACCU-
MULATED  DATA  FOR  THE  THREE YEARS THAT INCLUDES THE PROGRAM YEAR JUST
COMPLETED AND THE PRECEDING TWO YEARS, THE FIRST YEAR OF WHICH SHALL  BE
CONSIDERED  THE BASE YEAR, AND (III) USING THE FIRST YEAR OF DATA AS THE
BASE YEAR, THE INCREASE OR DECREASE IN EACH FACTOR APPLICABLE  FROM  THE
INITIAL OR BASE YEAR:

S. 2609--C                         65

  (1) NUMBER OF CLIENTS SERVED IN THE INCUBATOR;
  (2) TOTAL NUMBER OF GRADUATES;
  (3)  NUMBER  OF GRADUATE FIRMS THAT ARE STILL IN BUSINESS OR HAVE BEEN
MERGED OR ACQUIRED;
  (4) THE FOLLOWING DATA FOR FIRMS IN THE INCUBATION  PROGRAM,  REPORTED
AS AGGREGATE DATA:
  I.  THE  NUMBER  OF INDIVIDUALS EMPLOYED FULL TIME OR FULL TIME EQUIV-
ALENTS, INCLUDING COMPANY PRINCIPALS, WHO ARE WORKING OR ARE INTENDED TO
WORK FULL WEEKS FOR A YEAR;
  II. COMPENSATION PAID;
  III. GROSS REVENUES OF FIRMS;
  IV. FIRM DEBT FINANCING FROM  ALL  SOURCES,  INCLUDING  BANK,  FAMILY,
FRIENDS, AND OTHER LOAN SOURCES;
  V. EQUITY CAPITAL FINANCING FROM ALL SOURCES;
  VI. GRANT FUNDS FROM ALL SOURCES;
  VII.  WHERE  APPLICABLE  AND AVAILABLE, THE NUMBER OF FULL TIME EQUIV-
ALENT  JOBS,  CONTRACT  VALUATION,  AND/OR  OTHER  ECONOMIC   VALUATION,
PROVIDED  BY  NEW  YORK  STATE  SUPPLIERS  TO  FIRMS  THAT ARE INCUBATOR
CLIENTS;
  (5) NUMBERS OF BUSINESSES THAT ON GRADUATION FROM THE INCUBATOR  MOVED
TO  THE  SURROUNDING COMMUNITY, OR WITHIN A REGIONAL DISTRESSED AREA, OR
WITHIN NEW YORK STATE;
  (6) NUMBERS OF  INDIVIDUALS  COUNSELED,  MENTORED,  ATTENDED  CLASSES,
COMPLETED BUSINESS PLANS;
  (7)  A DESCRIPTION OF THE ENTREPRENEURIAL AND ECONOMIC IMPACT THAT THE
INCUBATOR HAS HAD ON THE SURROUNDING REGION AND COMMUNITY  THAT  CAN  BE
ATTRIBUTED TO RESOURCES ASSEMBLED BY THE INCUBATOR OR TO PERSONS PARTIC-
IPATING  IN ITS PROGRAMS IN ROLES INCLUDING BUT NOT LIMITED TO ADVISORS,
MENTORS,  INVESTORS,  ENTREPRENEURS-IN-RESIDENCE,   PROFESSIONAL-SERVICE
PROVIDERS,  STUDENT INTERNS.   THE DESCRIPTION SHALL INSOFAR AS POSSIBLE
INCLUDE SUCH QUANTIFIABLE FACTORS AND OUTCOMES AS  INCREASED  NUMBER  OF
STARTUPS,  INCREASED BUSINESS OR FINANCINGS (INCLUDING AMONG INDIVIDUALS
AND ENTITIES WHICH ARE NOT CLIENTS), WIDELY-ATTENDED PROGRAMS AND EVENTS
SPONSORED BY THE INCUBATOR  OR  PRODUCED  IN  COLLABORATION  WITH  OTHER
INSTITUTIONS   OR  BUSINESS  ASSOCIATIONS  OR  PROGRAMS,  NEWS  STORIES,
OUTREACH AND ATTENDANCE OF ENTREPRENEURIAL EVENTS AND CLASSES  INTO  NEW
OR NON-TRADITIONAL GROUPS WITHIN THE COMMUNITY, SURVEYS, ENDORSEMENTS BY
PUBLIC  OFFICIALS,  ECONOMIC-DEVELOPMENT AND BUSINESS-ATTRACTION PROFES-
SIONALS, AND LEADERS OF BUSINESS ASSOCIATIONS, AND OTHER SIMILAR SIGNIF-
ICANT FACTORS.
  THE PROGRAM SHALL ALSO PROVIDE TO THE CORPORATION THE TWO MOST  RECENT
AUDITED  FINANCIAL  STATEMENTS OF THE SPONSORING ENTITY WHOSE ENGAGEMENT
SCOPE INCLUDES THE INCUBATOR PROGRAM, OR IF NO SPONSORING  ENTITY,  THEN
OF THE INCUBATOR PROGRAM.  SUCH FINAL STATEMENTS SHALL BE PREPARED BY AN
INDEPENDENT AUDITING FIRM WHOSE PRINCIPALS ARE CERTIFIED PUBLIC ACCOUNT-
ANTS LICENSED BY THE STATE EDUCATION DEPARTMENT.
  3.  DESIGNATION.  (A) THE CORPORATION SHALL DESIGNATE APPLICANTS WHICH
MEET THE REQUIREMENTS OF SUBDIVISION TWO OF THIS  SECTION  AS  NEW  YORK
STATE INCUBATORS.
  (B)  AS  A  CONDITION OF MAINTAINING DESIGNATION, EACH INCUBATOR SHALL
ANNUALLY SUBMIT TO THE CORPORATION IN A MANNER AND ACCORDING TO A SCHED-
ULE ESTABLISHED BY THE CORPORATION:
  (I) UPDATED INFORMATION AS REQUIRED IN PARAGRAPH  (B)  OF  SUBDIVISION
TWO OF THIS SECTION, MAINTAINING THE INITIAL BASE YEAR IN ORDER TO MEAS-
URE THE INCREASE OR DECREASE IN EACH FACTOR OR DATA;

S. 2609--C                         66

  (II)  ITS STRATEGIC PLAN, AS UPDATED ALONG WITH A BRIEF DESCRIPTION OF
ITS SUCCESS IN MEETING THE GOALS OF ITS STRATEGIC PLAN;
  (III)  A  STATEMENT THAT THE ITEMS LISTED IN PARAGRAPH (A) OF SUBDIVI-
SION TWO OF THIS SECTION ARE STILL APPLICABLE TO THE OPERATIONS  OF  THE
INCUBATOR, OR ANY CHANGE IN APPLICABILITY; AND
  (IV) SUCH ADDITIONAL INFORMATION AS THE COMMISSIONER MAY REQUIRE.
  (C)  THE  CORPORATION  SHALL  DESIGN  SIMPLIFIED  FORMS  TO AID IN THE
SUBMISSION OF THE DATA  REQUIRED  IN  THIS  SUBDIVISION,  WHICH  MAY  BE
SUBMITTED  ELECTRONICALLY.    SUCH FORMS SHALL STATE THE PURPOSES OF THE
REQUIRED DATA SUBMISSIONS.
  (D) THE CORPORATION SHALL EVALUATE THE  OPERATIONS  OF  THE  INCUBATOR
USING METHODS INCLUDING BUT NOT LIMITED TO SITE VISITS, REPORTS PURSUANT
TO  SPECIFIED INFORMATION, AND REVIEW EVALUATIONS. IF THE CORPORATION IS
UNSATISFIED WITH THE PROGRESS OF AN  INCUBATOR,  THE  CORPORATION  SHALL
NOTIFY SUCH INCUBATOR OF THE RESULTS OF ITS EVALUATIONS AND THE FINDINGS
OF  DEFICIENCIES  IN  ITS  OPERATIONS AND SHALL ALLOW AND COOPERATE WITH
SUCH INCUBATOR TO REMEDY SUCH FINDINGS IN A TIMELY MANNER. FOR NEW  YORK
STATE  INCUBATORS  WHICH RECEIVE SUSTAINING OPERATING GRANTS PURSUANT TO
PARAGRAPH (A) OF SUBDIVISION FOUR  OF  THIS  SECTION,  SUCH  EVALUATIONS
SHALL  INCLUDE  PEER REVIEW AND SHALL TAKE PLACE NO LESS THAN ONCE EVERY
THREE YEARS OR MORE OFTEN FOR ANY INDIVIDUAL INCUBATOR WHICH IS A RECIP-
IENT OF SUCH GRANT AT THE DISCRETION OF  THE  CORPORATION.    SUCH  PEER
REVIEW  SHALL  BE IMPLEMENTED THROUGH CONTRACT WITH A STATE ASSOCIATION,
AS PROVIDED IN SUBDIVISION EIGHT OF THIS SECTION, AND SHALL RESULT IN  A
WRITTEN  REPORT  THAT INCLUDES PROGRAMMATIC AND FISCAL EVALUATION OF THE
INCUBATION PROGRAM AND RECOMMENDATIONS FOR IMPROVEMENT.  MEMBERS OF SUCH
PEER REVIEW GROUP SHALL INCLUDE OPERATORS OF OTHER INCUBATOR PROGRAMS, A
SIGNIFICANT PORTION OF WHOM SHALL BE DIRECTORS OR OPERATORS  OF  INCUBA-
TORS WHICH ARE LOCATED OUTSIDE OF NEW YORK STATE.
  4.  GRANTS. (A) SUSTAINING OPERATING GRANTS. A PROGRAM DESIGNATED AS A
NEW YORK STATE INCUBATOR SHALL BE ELIGIBLE FOR AN OPERATING GRANT IN  AN
AMOUNT  NOT  TO  EXCEED  ONE  HUNDRED  FIFTY THOUSAND DOLLARS FROM FUNDS
AVAILABLE  TO  THE  CORPORATION  OR  OTHERWISE  APPROPRIATED   THEREFOR,
PROVIDED HOWEVER THAT:
  (I)  ANY  SUCH  GRANT  SHALL  BE  MATCHED ON A TWO-TO-ONE BASIS BY THE
INSTITUTION RECEIVING THE FUNDS AND COLLABORATIVE PARTNERS IN  THE  FORM
OF  CASH  OR IN-KIND PERSONNEL, EQUIPMENT, MATERIAL DONATIONS, AND OTHER
FACILITY AND OPERATIONS EXPENDITURES, PROVIDED THAT NO MORE  THAN  FIFTY
PERCENT OF SUCH MATCH SHALL BE IN-KIND;
  (II)  A  PROGRAM  APPLYING  FOR  A  GRANT  SHALL DEMONSTRATE FINANCIAL
STABILITY AND LONG TERM VIABILITY, AS PROVIDED IN SUBPARAGRAPH (XIII) OF
PARAGRAPH (A) OF SUBDIVISION TWO OF THIS SECTION;
  (III) A GRANT RECIPIENT SHALL AGREE TO PROVIDE DATA AS REQUIRED TO THE
DEPARTMENT AND SHALL AGREE TO CONFORM TO BEST PRACTICES AS  OUTLINED  BY
STATE AND/OR NATIONAL BUSINESS INCUBATOR ASSOCIATIONS; AND
  (IV)  FAILURE  TO  ABIDE BY THE REQUIREMENTS OF THIS SUBDIVISION OR TO
CURE A DEFAULT AFTER REVIEW AND AGREEMENT  WITH  THE  CORPORATION  SHALL
RESULT  IN  LOSS  OF THE GRANT AND DISQUALIFICATION OF THE DESIGNEE AS A
NEW YORK STATE INCUBATOR.
  (B) PLANNING GRANTS. A SPONSOR SEEKING TO DEVELOP AN INCUBATOR PROGRAM
MAY BE ELIGIBLE FOR A PLANNING GRANT IN AN AMOUNT NOT TO EXCEED  FIFTEEN
THOUSAND  DOLLARS.  A  SPONSOR  SEEKING TO OBTAIN A PLANNING GRANT SHALL
PROVIDE THE FOLLOWING BASIC DATA AND OTHER  INFORMATION  TO  DEMONSTRATE
VIABILITY TO THE SATISFACTION OF THE CORPORATION:
  (I) NAME, FINANCIAL STRENGTH, HISTORY, CORPORATE FORM, AND EVIDENCE OF
THE COMMITMENT AND FINANCIAL AND PROGRAMMATIC ABILITY OF THE SPONSOR AND

S. 2609--C                         67

ITS CONSULTANTS AND COLLABORATORS TO BRING THE PROJECT TO COMPLETION AND
TO  SUSTAIN THE PROJECT FOR AT LEAST THREE YEARS AFTER CREATION, INCLUD-
ING RELEVANT SIGNED COPIES OF FEDERAL TAX  RETURNS  FOR  THE  PRIOR  TWO
YEARS;
  (II)  A BUSINESS PLAN DETAILING ESTIMATED FINANCING COSTS AND SOURCES,
STAFFING, PROGRAM DESIGN, HOW IT WILL MEET SPACE SIZE AND COSTS REQUIRE-
MENTS FOR AT LEAST FIVE YEARS, INCLUDING EVIDENCE THAT IT  HAS  OR  WILL
SHORTLY  HAVE  COMPLETE  OR CONTINGENT CONTROL OF THE SPACE, AND PROJECT
TIMELINE, OUTCOMES AND DELIVERABLES;
  (III) THE KINDS AND NUMBERS OF SHORT AND LONG TERM JOBS ANTICIPATED TO
BE CREATED BY AND THROUGH THE PROJECT, THE TARGET AREAS FOR CLIENT INCU-
BATION, AND HOW THE PROJECT WILL RECRUIT AND  SELECT  THE  COMPANIES  IT
WILL ACCEPT FOR INCUBATION;
  (IV)  THE  QUALIFICATIONS THAT MAKE THE PROJECT A UNIQUE AND/OR NECES-
SARY ECONOMIC PRIORITY FOR THE REGION, MUNICIPALITY,  OR  COMMUNITY,  BY
CREATING JOBS AND ECONOMIC INVESTMENT AND DEVELOPMENT, LEADING COMMUNITY
REVITALIZATION, AND OTHER SIMILAR FACTORS;
  (V)  WHETHER  THE PROJECT HAS BEEN ENDORSED BY AREA MUNICIPAL OR OTHER
AREA REPRESENTATIVE PUBLIC OFFICIALS, AND AREA BUSINESS ASSOCIATIONS;
  (VI) WHETHER THE PROJECT OR A PHASE OF THE PROJECT  HAS  BEEN  AWARDED
STATE  OR  OTHER  FUNDING,  THE  AMOUNT OF FUNDING RECEIVED, WHETHER ANY
EXPENDITURE FOR THE PROJECT HAS BEEN MADE  PRIOR  TO  THE  DATE  OF  THE
APPLICATION; AND
  (VII)  A  STATEMENT  THAT THE APPLICANT IN THIS OR SOME OTHER FORM HAS
NOT PREVIOUSLY RECEIVED A PLANNING GRANT PURSUANT TO THIS SECTION.
  (C) STABILIZATION GRANTS. A PROGRAM  WHICH  HAS  RECEIVED  A  PLANNING
GRANT,  AND  WHICH  OTHERWISE MEETS THE REQUIREMENTS OF PARAGRAPH (A) OF
SUBDIVISION TWO OF THIS  SECTION,  INCLUDING  SUBPARAGRAPHS  (XIII)  AND
(XVIII)  OF  SUCH PARAGRAPH, SHALL BE ELIGIBLE FOR A STABILIZATION GRANT
IN AN ANNUAL AMOUNT NOT TO  EXCEED  TWENTY-FIVE  THOUSAND  DOLLARS  FROM
FUNDS  AVAILABLE  TO THE CORPORATION OR APPROPRIATED THEREFOR. A PROGRAM
MAY NOT RECEIVE MORE THAN THREE SUCH STABILIZATION GRANTS,  WHICH  SHALL
ONLY  BE  AVAILABLE  ON  SUCCESSIVE  YEARS,  AND ONLY FOR SO LONG AS THE
PROGRAM MEETS THE REQUIREMENTS OF PARAGRAPH (A) OF  SUBDIVISION  TWO  OF
THIS  SECTION,  INCLUDING SUBPARAGRAPHS (XIII) AND (XVIII) OF SUCH PARA-
GRAPH.
  (D) CAPITAL ASSISTANCE. THE CORPORATION SHALL MAKE PROGRAMS DESIGNATED
AS NEW YORK STATE INCUBATORS OR WHICH ARE IN RECEIPT OF OR HAVE  APPLIED
FOR PLANNING OR STABILIZATION GRANTS, AWARE OF OPPORTUNITIES FOR CAPITAL
FUNDING  OR  GRANTS  BY  OR THROUGH THE CORPORATION OR THE DEPARTMENT OF
ECONOMIC DEVELOPMENT.
  (E) NO DEDUCTION. IN ADDITION TO THE FOREGOING REQUIREMENTS, AN  INCU-
BATOR  SPONSOR  SHALL  AGREE  TO  DEDICATE  ALL FUNDS FROM ANY GRANTS OR
SUPPORT RECEIVED PURSUANT TO THIS SUBDIVISION EXCEPT FOR  PARAGRAPH  (D)
OF  THIS  SUBDIVISION  WHICH  IS  SUBJECT TO SEPARATE AGREEMENTS, TO THE
OPERATIONS OF THE INCUBATOR OR THE PLANNING THEREFOR WITHOUT  DEDUCTIONS
FOR  OVERHEAD,  INDIRECT COSTS, OR FACILITIES AND ADMINISTRATION CHARGES
OF SUCH SPONSOR.
  5. PROCUREMENT. (A) A CLIENT OF A NEW YORK STATE INCUBATOR  DESIGNATED
PURSUANT TO THIS SECTION SHALL BE DEEMED A SMALL BUSINESS CONCERN PURSU-
ANT  TO  SUBDIVISION  6  OF SECTION 163 OF THE STATE FINANCE LAW, AND TO
PARAGRAPH N OF SUBDIVISION 2 OF SECTION 161 OF SUCH LAW. THE CORPORATION
SHALL COLLABORATE  WITH  THE  COMMISSIONER  OF  THE  OFFICE  OF  GENERAL
SERVICES  AND THE COMMISSIONER OF ECONOMIC DEVELOPMENT WHO SHALL USE HIS
OR HER MEMBERSHIP ON THE STATE PROCUREMENT COUNCIL, TO ADVANCE,  TARGET,
AND  DEVELOP  PROCUREMENT  PROGRAMS  FOR  THE  PURCHASE  OF SERVICES AND

S. 2609--C                         68

COMMODITIES, INCLUDING TECHNOLOGIES OR COMMODITIES THAT ARE RECYCLED  OR
REMANUFACTURED,  TOWARD CLIENTS OF NEW YORK STATE INCUBATORS. THE CORPO-
RATION SHALL ADDITIONALLY, THROUGH MEMBERSHIP ON THE  STATE  PROCUREMENT
COUNCIL  AND COLLABORATION WITH THE COMMISSIONER OF GENERAL SERVICES AND
OTHER STATE AGENCIES, DEVELOP OPPORTUNITIES  FOR  TEAMING  ON  CONTRACTS
BETWEEN  SMALL  BUSINESS  CONCERNS  WHICH  ARE CLIENTS OF NEW YORK STATE
INCUBATORS AND OTHER BUSINESS ENTITIES WHICH MAY  PROVIDE  RESOURCES  OR
CREDIT  NECESSARY FOR THE SUCCESSFUL COMPLETION OF CONTRACT REQUIREMENTS
FOR SUCH COMMODITIES, SERVICES, OR TECHNOLOGIES BY SUCH  SMALL  BUSINESS
CONCERNS.
  (B)  THE CORPORATION SHALL PROPOSE AND IMPLEMENT AN INCUBATOR RATE FOR
ACCESS BY CLIENTS OF NEW YORK STATE INCUBATORS TO THE PROCUREMENT OPPOR-
TUNITIES NEWSLETTER WEBSITE AND TO ENHANCED ACCESS SERVICES OF THE NEWS-
LETTER. SUCH RATE SHALL IN NO CASE BE MORE THAN  THE  MARGINAL  COST  OF
PROVIDING  SUCH  ACCESS  TO  CLIENTS OF NEW YORK STATE INCUBATORS. ADDI-
TIONALLY THE CORPORATION SHALL PROVIDE ACCESS TO BIDLINX BY  CLIENTS  OF
NEW YORK STATE INCUBATORS AT A RATE NO GREATER THAN THE LOWEST RATE PAID
BY  ANY  USER  OF  THE SERVICE. IF THE LOWEST RATE PAID BY A USER OF THE
SERVICE IS ZERO, THEN THAT SHALL BE THE RATE FOR ACCESS  BY  CLIENTS  OF
NEW YORK STATE INCUBATORS.
  6.  INCUBATORS  AS EDUCATIONAL ENTITIES. REAL PROPERTY OWNED OR LEASED
BY A NEW YORK STATE INCUBATOR WHICH IS A NONPROFIT  ORGANIZATION  HAVING
TAX  EXEMPT STATUS UNDER SECTION 501(C)(3) OF THE UNITED STATES INTERNAL
REVENUE CODE, OR WHICH IS A NEW YORK STATE INCUBATOR OWNED AND SPONSORED
BY A NONPROFIT ORGANIZATION HAVING SUCH TAX EXEMPT STATUS, OR  WHICH  IS
AFFILIATED  WITH  A COLLEGE CHARTERED BY THE REGENTS OF THE STATE OF NEW
YORK OR A COLLEGE INCORPORATED BY SPECIAL ACT OF  THE  LEGISLATURE,  AND
WHICH  IS  USED  FOR THE PURPOSES DESCRIBED IN THIS SECTION OF TRAINING,
EDUCATING, MENTORING, AND DEVELOPING CLIENT ENTREPRENEURS  AND  BUSINESS
ENTITIES,  WHICH  ARE THE CRITERIA FOR DESIGNATION OF A PROGRAM AS A NEW
YORK STATE INCUBATOR, SHALL BE DEEMED TO BE PROPERTY OF  AN  EDUCATIONAL
CORPORATION  FOR PURPOSES OF SECTION 420-A OF THE REAL PROPERTY TAX LAW,
INCLUDING ANY CLASSROOMS, CONFERENCE ROOMS, LABORATORY,  MEETING  SPACE,
ADMINISTRATION AREA, KITCHEN AREA, PARKING, STORAGE, OR OTHER AREA WHICH
IS  USED  PRIMARILY  TO PROVIDE DIRECT AND INDIRECT SERVICES TO RESIDENT
CLIENTS OF SUCH FACILITY, AND  INCLUDING  SPACE  FOR  RESIDENT  CLIENTS'
OFFICES  PURSUANT TO A LICENSE OR LEASE BETWEEN SUCH INCUBATOR AND RESI-
DENT CLIENTS, NOTWITHSTANDING THAT SUCH RESIDENT CLIENTS MAY, OR MAY NOT
BE, NOT-FOR-PROFIT ORGANIZATIONS. THE  EXEMPTION  PROVIDED  FOR  IN  THE
PRECEDING  SENTENCE  SHALL  ALSO  APPLY  TO  A  PROGRAM  WHICH MEETS THE
REQUIREMENTS ESTABLISHED THEREIN, BUT WHICH IS A PROGRAM THAT THE CORPO-
RATION HAS DETERMINED IS ELIGIBLE TO RECEIVE OR IS RECEIVING  STABILIZA-
TION  GRANTS PURSUANT TO THIS SECTION. ANY PORTION OF SUCH REAL PROPERTY
WHICH IS LEASED OR LICENSED TO AN INDIVIDUAL OR BUSINESS ENTITY WHICH IS
NOT A RESIDENT CLIENT OF THE NEW YORK STATE  INCUBATOR  OR  THE  PROGRAM
DESCRIBED IN THIS SUBDIVISION WHICH IS ELIGIBLE TO RECEIVE OR IS RECEIV-
ING  STABILIZATION GRANTS, OR WHICH DOES NOT OTHERWISE MEET THE REQUIRE-
MENTS OF SUBDIVISION 1 OF SUCH SECTION 420-A OF THE  REAL  PROPERTY  TAX
LAW,  SHALL  BE  SUBJECT  TO  THE PROVISIONS OF SUBDIVISION 2 OF SECTION
420-A OF THE REAL PROPERTY TAX LAW.
  7. OTHER ASSISTANCE.  THE  CORPORATION  SHALL  MAKE  SUCH  OTHER  AID,
ASSISTANCE,  AND  RESOURCES  AVAILABLE  TO NEW YORK STATE INCUBATORS AND
THEIR CLIENTS AS HE OR SHE SHALL DEEM USEFUL  AND  APPROPRIATE  FOR  THE
FURTHERANCE  OF  THE  PURPOSES OF THIS ACT, INCLUDING WITHOUT LIMITATION
TECHNICAL ASSISTANCE, AID IN MARKETING, AID IN  REACHING  AND  PROVIDING
ENTREPRENEURSHIP  TRAINING  OPPORTUNITIES TO SUCH MARGINALIZED GROUPS AS

S. 2609--C                         69

THOSE COMPOSED OF INDIVIDUALS WHO ARE  MINORITY,  FEMALE,  DISABLED,  OR
POOR,  AND  OTHERS,  CURRICULUM  DEVELOPMENT,  AND  OTHER  SERVICES  AND
RESOURCES. THE CORPORATION SHALL ALSO SEEK ASSISTANCE FROM  OTHER  STATE
AGENCIES  IN  THE DEVELOPMENT OF PROCUREMENT AND MARKETING RESOURCES AND
TRAINING OPPORTUNITIES FOR NEW YORK STATE INCUBATORS AND THEIR CLIENTS.
  8. SERVICE CONTRACT. THE CORPORATION SHALL CONTRACT WITH  A  STATEWIDE
ENTITY  WHICH  IS  A MEMBERSHIP ASSOCIATION OF INCUBATORS AND OTHERS AND
WHICH HAS EXPERTISE IN PROVIDING SERVICES TO INCUBATORS FOR THE  PURPOSE
OF  PROVIDING  SERVICES TO ENTITIES DESIGNATED AS NEW YORK STATE INCUBA-
TORS AND TO ENTITIES SEEKING TO APPLY OR APPLYING  TO  BECOME  NEW  YORK
STATE  INCUBATORS  OR  WHICH  OTHERWISE  ARE  INCLUDED  AS RECIPIENTS OF
SERVICES PURSUANT TO THIS SECTION. SUCH SERVICES SHALL INCLUDE  ADVISING
CONCERNING  BEST  PRACTICES  OF  INCUBATION  AND DEVELOPMENT OF PLANS TO
INCORPORATE AND INTEGRATE SUCH PRACTICES, DEVELOPMENT OF DATA CONCERNING
INCUBATION IN THIS STATE AND RECOMMENDATIONS  FOR  IMPROVEMENT,  AID  IN
MARKETING  AND  EVENT SPONSORSHIP, AND SUCH OTHER SERVICES AS THE CORPO-
RATION SHALL DEEM NECESSARY AND  APPROPRIATE  TO  THE  STRENGTHENING  OF
BUSINESS INCUBATION IN THIS STATE.
  S 3. This act shall take effect immediately.

                                 PART GG

  Section  1.  Section  606  of  the  tax law is amended by adding a new
subsection (vv) to read as follows:
  (VV) CREDIT FOR REHABILITATION OF  DISTRESSED  COMMERCIAL  PROPERTIES.
(1)  FOR TAXABLE YEARS BEGINNING ON OR AFTER JANUARY FIRST, TWO THOUSAND
THIRTEEN, 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 QUALIFIED REHABILITATION EXPENDITURES MADE BY THE TAXPAY-
ER WITH RESPECT TO A QUALIFIED DISTRESSED COMMERCIAL PROPERTY. PROVIDED,
HOWEVER, THE CREDIT SHALL NOT EXCEED ONE HUNDRED THOUSAND DOLLARS.
  (2) TAX CREDITS ALLOWED PURSUANT TO THIS SUBSECTION SHALL  BE  ALLOWED
IN THE TAXABLE YEAR IN WHICH THE PROPERTY IS DEEMED A CERTIFIED REHABIL-
ITATION.
  (3)  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, BUT SHALL NOT
EXCEED TWENTY-FIVE THOUSAND DOLLARS.
  (4) (A) THE TERM "QUALIFIED  REHABILITATION  EXPENDITURE"  MEANS,  FOR
PURPOSES OF THIS SUBSECTION, ANY AMOUNT PROPERLY CHARGEABLE TO A CAPITAL
ACCOUNT:
  (I)  IN  CONNECTION  WITH  THE CERTIFIED REHABILITATION OF A QUALIFIED
DISTRESSED COMMERCIAL PROPERTY, AND
  (II) FOR PROPERTY FOR WHICH  DEPRECIATION  WOULD  BE  ALLOWABLE  UNDER
SECTION 168 OF THE INTERNAL REVENUE CODE.
  (B) SUCH TERM SHALL NOT INCLUDE (I) THE COST OF ACQUIRING ANY BUILDING
OR  INTEREST  THEREIN, (II) ANY EXPENDITURE ATTRIBUTABLE TO THE ENLARGE-
MENT OF AN EXISTING BUILDING, OR (III) ANY  EXPENDITURE  MADE  PRIOR  TO
JANUARY FIRST, TWO THOUSAND THIRTEEN OR AFTER DECEMBER THIRTY-FIRST, TWO
THOUSAND EIGHTEEN.
  (5)  THE  TERM  "CERTIFIED REHABILITATION" MEANS, FOR PURPOSES OF THIS
SUBSECTION, ANY REHABILITATION  OF  A  CERTIFIED  DISTRESSED  COMMERCIAL
PROPERTY  WHICH HAS BEEN APPROVED AND CERTIFIED BY A LOCAL GOVERNMENT AS
BEING COMPLETED, WITH A CERTIFICATE OF OCCUPANCY ISSUED,  AND  THAT  THE
COSTS  ARE  CONSISTENT WITH THE WORK COMPLETED. SUCH CERTIFICATION SHALL

S. 2609--C                         70

BE ACCEPTABLE AS PROOF THAT THE EXPENDITURES RELATED TO  SUCH  REHABILI-
TATION  QUALIFY AS QUALIFIED REHABILITATION EXPENDITURES FOR PURPOSES OF
THE CREDIT ALLOWED UNDER PARAGRAPH ONE OF THIS SUBSECTION.
  (6) (A) THE TERM "QUALIFIED DISTRESSED COMMERCIAL PROPERTY" MEANS, FOR
PURPOSES  OF  THIS  SUBSECTION, A DISTRESSED COMMERCIAL PROPERTY LOCATED
WITHIN NEW YORK STATE:
  (I) WHICH HAS BEEN SUBSTANTIALLY REHABILITATED,
  (II) WHICH IS OWNED BY THE TAXPAYER, AND
  (III) WHICH IS LOCATED WITHIN A DISTRESSED COMMERCIAL AREA, AS IDENTI-
FIED BY EACH LOCALITY THROUGH LOCAL LAW, THAT IS DEEMED AN AREA IN  NEED
OF COMMUNITY RENEWAL DUE TO DILAPIDATION AND VACANCIES.
  (B)  IF  THE  DISTRESSED  COMMERCIAL PROPERTY IS RENTAL PROPERTY, SUCH
PROPERTY SHALL HAVE BEEN MORE THAN  THIRTY  PERCENT  VACANT  FOR  TWELVE
MONTHS WHILE ACTIVELY MARKETED FOR LEASE.
  (C) A BUILDING SHALL BE TREATED AS HAVING BEEN "SUBSTANTIALLY REHABIL-
ITATED" IF THE QUALIFIED REHABILITATION EXPENDITURES IN RELATION TO SUCH
BUILDING TOTAL TEN THOUSAND DOLLARS OR MORE.
  (7)  (A)  IF  THE TAXPAYER DISPOSES OF SUCH TAXPAYER'S INTEREST IN THE
QUALIFIED DISTRESSED COMMERCIAL PROPERTY, OR SUCH PROPERTY CEASES TO  BE
USED  AS  A  COMMERCIAL  PROPERTY  OF  THE TAXPAYER WITHIN FIVE YEARS OF
RECEIVING THE CREDIT UNDER THIS SUBSECTION, THE TAXPAYER'S  TAX  IMPOSED
BY THIS ARTICLE FOR THE TAXABLE YEAR IN WHICH SUCH DISPOSITION OR CESSA-
TION  OCCURS  SHALL  BE INCREASED BY THE RECAPTURE PORTION OF THE CREDIT
ALLOWED UNDER THIS SUBSECTION FOR ALL PRIOR TAXABLE YEARS  WITH  RESPECT
TO SUCH REHABILITATION.
  (B)  FOR PURPOSES OF SUBPARAGRAPH (A) OF THIS PARAGRAPH, THE RECAPTURE
PORTION SHALL BE THE PRODUCT OF THE AMOUNT  OF  CREDIT  CLAIMED  BY  THE
TAXPAYER MULTIPLIED BY A RATIO, THE NUMERATOR OF WHICH IS EQUAL TO SIXTY
LESS  THE  NUMBER  OF MONTHS THE BUILDING IS OWNED OR USED AS COMMERCIAL
PROPERTY BY THE TAXPAYER AND THE DENOMINATOR OF WHICH IS SIXTY.
  S 2. 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 REHABILITATION      AMOUNT OF CREDIT UNDER
OF DISTRESSED COMMERCIAL PROPERTIES   SUBDIVISION FORTY-SIX
UNDER SUBSECTION (VV)                 OF SECTION TWO HUNDRED TEN
  S 3. Section 210 of the tax law is amended by adding a new subdivision
46 to read as follows:
  46. CREDIT FOR REHABILITATION OF DISTRESSED COMMERCIAL PROPERTIES. (1)
FOR TAXABLE YEARS BEGINNING ON OR  AFTER  JANUARY  FIRST,  TWO  THOUSAND
THIRTEEN,  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 QUALIFIED REHABILITATION EXPENDITURES MADE BY THE TAXPAY-
ER WITH RESPECT TO A QUALIFIED DISTRESSED COMMERCIAL PROPERTY. PROVIDED,
HOWEVER, THE CREDIT SHALL NOT EXCEED ONE HUNDRED THOUSAND DOLLARS.
  (2)  TAX CREDITS ALLOWED PURSUANT TO THIS SUBDIVISION SHALL BE ALLOWED
IN THE TAXABLE YEAR IN WHICH THE PROPERTY IS DEEMED A CERTIFIED REHABIL-
ITATION.
  (3) 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
APPLIED AGAINST THE TAXPAYER'S TAX FOR SUCH YEAR OR YEARS, BUT SHALL NOT
EXCEED TWENTY-FIVE THOUSAND DOLLARS.
  (4)  (A)  THE  TERM  "QUALIFIED REHABILITATION EXPENDITURE" MEANS, FOR
PURPOSES OF THIS SUBDIVISION, ANY AMOUNT PROPERLY CHARGEABLE TO A  CAPI-
TAL ACCOUNT:

S. 2609--C                         71

  (I)  IN  CONNECTION  WITH  THE CERTIFIED REHABILITATION OF A QUALIFIED
COMMERCIAL PROPERTY, AND
  (II)  FOR  PROPERTY  FOR  WHICH  DEPRECIATION WOULD BE ALLOWABLE UNDER
SECTION 168 OF THE INTERNAL REVENUE CODE.
  (B) SUCH TERM SHALL NOT INCLUDE (I) THE COST OF ACQUIRING ANY BUILDING
OR INTEREST THEREIN, (II) ANY EXPENDITURE ATTRIBUTABLE TO  THE  ENLARGE-
MENT  OF  AN  EXISTING  BUILDING, OR (III) ANY EXPENDITURE MADE PRIOR TO
JANUARY FIRST, TWO THOUSAND THIRTEEN OR AFTER DECEMBER THIRTY-FIRST, TWO
THOUSAND EIGHTEEN.
  (5) THE TERM "CERTIFIED REHABILITATION" MEANS, FOR  PURPOSES  OF  THIS
SUBDIVISION,  ANY  REHABILITATION  OF  A CERTIFIED DISTRESSED COMMERCIAL
PROPERTY WHICH HAS BEEN APPROVED AND CERTIFIED BY A LOCAL GOVERNMENT  AS
BEING  COMPLETED,  WITH  A CERTIFICATE OF OCCUPANCY ISSUED, AND THAT THE
COSTS ARE CONSISTENT WITH THE WORK COMPLETED. SUCH  CERTIFICATION  SHALL
BE  ACCEPTABLE  AS PROOF THAT THE EXPENDITURES RELATED TO SUCH REHABILI-
TATION QUALIFY AS QUALIFIED REHABILITATION EXPENDITURES FOR PURPOSES  OF
THE CREDIT ALLOWED UNDER PARAGRAPH ONE OF THIS SUBDIVISION.
  (6) (A) THE TERM "QUALIFIED DISTRESSED COMMERCIAL PROPERTY" MEANS, FOR
PURPOSES  OF  THIS SUBDIVISION, A DISTRESSED COMMERCIAL PROPERTY LOCATED
WITHIN NEW YORK STATE:
  (I) WHICH HAS BEEN SUBSTANTIALLY REHABILITATED,
  (II) WHICH IS OWNED BY THE TAXPAYER, AND
  (III) WHICH IS LOCATED WITHIN A DISTRESSED COMMERCIAL AREA, AS IDENTI-
FIED BY EACH LOCALITY THROUGH LOCAL LAW, THAT IS DEEMED AN AREA IN  NEED
OF COMMUNITY RENEWAL DUE TO DILAPIDATION AND VACANCIES.
  (B)  IF  THE  DISTRESSED  COMMERCIAL PROPERTY IS RENTAL PROPERTY, SUCH
PROPERTY SHALL HAVE BEEN MORE THAN  THIRTY  PERCENT  VACANT  FOR  TWELVE
MONTHS WHILE ACTIVELY MARKETED FOR LEASE.
  (C) A BUILDING SHALL BE TREATED AS HAVING BEEN "SUBSTANTIALLY REHABIL-
ITATED" IF THE QUALIFIED REHABILITATION EXPENDITURES IN RELATION TO SUCH
BUILDING TOTAL TEN THOUSAND DOLLARS OR MORE.
  (7)  (A)  IF  THE TAXPAYER DISPOSES OF SUCH TAXPAYER'S INTEREST IN THE
QUALIFIED DISTRESSED COMMERCIAL PROPERTY, OR SUCH PROPERTY CEASES TO  BE
USED  AS  A  COMMERCIAL  PROPERTY  OF  THE TAXPAYER WITHIN FIVE YEARS OF
RECEIVING THE CREDIT UNDER THIS SUBDIVISION, THE TAXPAYER'S TAX  IMPOSED
BY THIS ARTICLE FOR THE TAXABLE YEAR IN WHICH SUCH DISPOSITION OR CESSA-
TION  OCCURS  SHALL  BE INCREASED BY THE RECAPTURE PORTION OF THE CREDIT
ALLOWED UNDER THIS SUBDIVISION FOR ALL PRIOR TAXABLE YEARS WITH  RESPECT
TO SUCH REHABILITATION.
  (B)  FOR PURPOSES OF SUBPARAGRAPH (A) OF THIS PARAGRAPH, THE RECAPTURE
PORTION SHALL BE THE PRODUCT OF THE AMOUNT  OF  CREDIT  CLAIMED  BY  THE
TAXPAYER MULTIPLIED BY A RATIO, THE NUMERATOR OF WHICH IS EQUAL TO SIXTY
LESS  THE  NUMBER  OF MONTHS THE BUILDING IS OWNED OR USED AS COMMERCIAL
PROPERTY BY THE TAXPAYER AND THE DENOMINATOR OF WHICH IS SIXTY.
  S 4. This act shall take effect immediately and shall apply to taxable
years beginning on or after January 1, 2013.

                                 PART HH

  Section 1. Section 214 of the state finance law, as amended by section
1 of part P of chapter 59 of the laws of 2007, is  amended  to  read  as
follows:
  S  214.  Establishment  and  purpose;  linked deposit program authori-
zation.  The excelsior linked deposit program  is  hereby  created.  The
purpose  of  the  program is to encourage and assist eligible businesses
within the state to undertake eligible  projects  that  will  materially

S. 2609--C                         72

contribute to improving their performance and competitiveness. The comp-
troller  is  hereby  authorized to use any moneys of the state the comp-
troller is authorized to invest pursuant to  section  ninety-eight-a  of
this  chapter  as  linked deposits for the program. Not more than [four]
FIVE hundred sixty million dollars of such moneys shall  be  on  deposit
pursuant  to the program at any given time. The commissioner of taxation
and finance is hereby authorized to use  funds  in  the  linked  deposit
program  fund established pursuant to section ninety-two-v of this chap-
ter as linked deposits for the program. Not more than one hundred  FIFTY
million dollars from the linked deposit program fund shall be on deposit
pursuant to the program at any given time.
  S 2. Subdivision 11 of section 213 of the state finance law is amended
by adding a new paragraph (g) to read as follows:
  (G) A QUALIFYING TECHNOLOGY OR INNOVATION BUSINESS THAT ENGAGES IN:
  (1)  BIOTECHNOLOGIES, WHICH SHALL BE DEFINED AS TECHNOLOGIES INVOLVING
THE SCIENTIFIC MANIPULATION  OF  LIVING  ORGANISMS,  ESPECIALLY  AT  THE
MOLECULAR  AND/OR  THE  SUB-MOLECULAR GENETIC LEVEL, TO PRODUCE PRODUCTS
CONDUCIVE TO IMPROVING THE LIVES AND  HEALTH  OF  PLANTS,  ANIMALS,  AND
HUMANS; AND THE ASSOCIATED SCIENTIFIC RESEARCH, PHARMACOLOGICAL, MECHAN-
ICAL,  AND  COMPUTATIONAL APPLICATIONS AND SERVICES CONNECTED WITH THESE
IMPROVEMENTS;
  (2) INFORMATION AND COMMUNICATION TECHNOLOGIES, EQUIPMENT AND  SYSTEMS
THAT  INVOLVE  ADVANCED  COMPUTER  SOFTWARE  AND HARDWARE, VISUALIZATION
TECHNOLOGIES, AND HUMAN INTERFACE TECHNOLOGIES;
  (3) ADVANCED MATERIALS AND PROCESSING TECHNOLOGIES  THAT  INVOLVE  THE
DEVELOPMENT,  MODIFICATION,  OR  IMPROVEMENT OF ONE OR MORE MATERIALS OR
METHODS TO PRODUCE DEVICES  AND  STRUCTURES  WITH  IMPROVED  PERFORMANCE
CHARACTERISTICS  OR SPECIAL FUNCTIONAL ATTRIBUTES, OR TO ACTIVATE, SPEED
UP, OR OTHERWISE ALTER CHEMICAL, BIOCHEMICAL, OR MEDICAL PROCESSES;
  (4) ELECTRONIC AND PHOTONIC DEVICES AND COMPONENTS FOR USE IN  PRODUC-
ING  ELECTRONIC,  OPTOELECTRONIC,  MECHANICAL  EQUIPMENT AND PRODUCTS OF
ELECTRONIC DISTRIBUTION WITH INTERACTIVE MEDIA CONTENT;
  (5) ENERGY EFFICIENCY, RENEWABLE ENERGY  AND  ENVIRONMENTAL  TECHNOLO-
GIES, PRODUCTS, DEVICES AND SERVICES; OR
  (6) SMALL SCALE SYSTEMS INTEGRATION AND PACKAGING.
  S  3.  Paragraph  (a)  of  subdivision  16 of section 213 of the state
finance law, as amended by chapter 424 of the laws of 2009,  is  amended
to read as follows:
  (a)  for  a  linked deposit made in connection with a linked loan to a
certified business in an empire zone or to an eligible business  located
in  a  highly distressed area or to an eligible business that is defined
in paragraph (b-1) of subdivision eleven of this section that is located
in a renewal community or defined in paragraph (b-2) of such subdivision
that is located in an empowerment zone or defined in paragraph (b-3)  of
such subdivision that is located in an enterprise community, OR A QUALI-
FYING  TECHNOLOGY  OR INNOVATION BUSINESS AS DEFINED IN PARAGRAPH (G) OF
SUBDIVISION ELEVEN OF THIS SECTION, respectively for  eligible  projects
defined  in  paragraph  (c)  of  subdivision twelve of this section or a
certified minority- or women-owned business enterprise for  an  eligible
project  defined  in paragraph (e) of subdivision twelve of this section
or to a defense industry manufacturer for a project defined in paragraph
(d) of subdivision twelve of this section,  a  fixed  rate  of  interest
which  is three hundred basis points below the lender's posted four year
certificate of deposit rate or, if the lender does not offer a four year
certificate of deposit, is three hundred basis points below the  average

S. 2609--C                         73

statewide  rate  for  four year certificates of deposit as determined by
the commissioner of economic development;
  S 4. This act shall take effect immediately.

                                 PART II

  Section  1.  Paragraph  4  of subsection (b) of section 800 of the tax
law, as added by section 1 of part B of chapter 56 of the laws of  2011,
is amended to read as follows:
  (4)  Any  eligible  educational  institution. An "eligible educational
institution" shall mean any public school district, a board  of  cooper-
ative  educational  services, a public elementary or secondary school, a
school approved pursuant to article eighty-five or  eighty-nine  of  the
education  law to serve students with disabilities of school age, [or] a
nonpublic elementary or secondary school that  provides  instruction  in
grade  one  or above, OR A COMMUNITY COLLEGE AS DEFINED IN SECTION THREE
HUNDRED FIFTY OF THE EDUCATION LAW.
  S 2. This act shall take effect on June 1, 2013.

                                 PART JJ

  Section 1.  Subsection (c) of section 612 of the tax law is amended by
adding a new paragraph 40 to read as follows:
  (40) THE AMOUNT THAT MAY BE SUBTRACTED  FROM  FEDERAL  ADJUSTED  GROSS
INCOME PURSUANT TO SUBSECTION (W) OF THIS SECTION.
  S  2. Section 612 of the tax law is amended by adding a new subsection
(w) to read as follows:
  (W) CONTRIBUTIONS MADE TO A FARM RESERVE ACCOUNT. (1) THERE  SHALL  BE
SUBTRACTED  FROM  FEDERAL ADJUSTED GROSS INCOME CONTRIBUTIONS MADE BY AN
ELIGIBLE FARMER TO A FARM RESERVE ACCOUNT, PROVIDED  SUCH  CONTRIBUTIONS
SHALL  NOT  EXCEED  FIVE THOUSAND DOLLARS FOR AN INDIVIDUAL TAXPAYER AND
SHALL NOT EXCEED TEN THOUSAND DOLLARS FOR MARRIED TAXPAYERS.
  (2)(I) FOR THE PURPOSES OF THIS SUBSECTION, THE TERM "ELIGIBLE FARMER"
MEANS A TAXPAYER WHOSE FEDERAL GROSS INCOME FROM FARMING FOR THE TAXABLE
YEAR IS AT LEAST TWO-THIRDS OF EXCESS FEDERAL GROSS INCOME.
  (3) FOR PURPOSES OF THIS SUBSECTION A  "FARM  RESERVE  ACCOUNT"  SHALL
MEAN  AN  ACCOUNT  ORGANIZED  OR CREATED IN THIS STATE FOR THE EXCLUSIVE
BENEFIT OF AN ELIGIBLE FARMER AND HIS OR HER SPOUSE FOR THE  PURPOSE  OF
MITIGATING  THE  LOSS  OF  INCOME  RESULTING  FROM  DIMINISHED YIELDS OR
PRODUCTION DUE  TO  NATURAL  DISASTER,  INFESTATION,  DISEASE,  INVASIVE
SPECIES,  OR  OTHER  CONDITIONS  TO BE DETERMINED BY THE COMMISSIONER OF
AGRICULTURE AND MARKETS.  EVERY  SUCH  ACCOUNT  SHALL  COMPLY  WITH  THE
FOLLOWING REQUIREMENTS:
  (I) THE ACCOUNT SHALL BE HELD IN A BANKING ORGANIZATION, AS DEFINED IN
SECTION  TWO  OF  THE  BANKING  LAW, NATIONAL BANKING ASSOCIATION, STATE
CHARTERED CREDIT UNION, FEDERAL MUTUAL SAVINGS BANK, FEDERAL SAVINGS AND
LOAN ASSOCIATION, OR FEDERAL CREDIT UNION AND SUCH  ACCOUNT  WAS  ESTAB-
LISHED PURSUANT TO THIS SUBSECTION.
  (II) ANY AMOUNT IN THE ACCOUNT IS NONFORFEITABLE.
  (III) THE FUNDS IN SUCH ACCOUNT SHALL NOT BE COMMINGLED WITH ANY OTHER
MONIES OF THE INDIVIDUAL BY THE TRUSTEE.
  (4)  WITHIN  SIXTY DAYS AFTER WITHDRAWAL OF MONIES FROM A FARM RESERVE
ACCOUNT, AN INDIVIDUAL SHALL SUBMIT SATISFACTORY PROOF  TO  THE  COMMIS-
SIONER, UPON FORMS PROVIDED BY THE DEPARTMENT, THAT THE MONIES WITHDRAWN
WERE  USED TO MITIGATE THE LOSS OF INCOME. IN THE EVENT THAT AN INDIVID-
UAL WITHDRAWS ALL OR ANY PART OF THE MONIES  FROM  THE  ACCOUNT  IN  THE

S. 2609--C                         74

ABSENCE  OF  LOSS OF INCOME DUE TO THE FACTORS LISTED IN PARAGRAPH THREE
OF THIS SUBSECTION, OR FAILS TO SUBMIT TO THE COMMISSIONER THE PROOF  AS
REQUIRED  PURSUANT  TO  THIS  PARAGRAPH,  SUCH INDIVIDUAL SHALL HAVE THE
ENTIRE  ACCOUNT  TAXED  AS  THOUGH  IT  WAS INCOME IN THE YEARS THAT THE
MONIES FROM THE ACCOUNT WERE DEPOSITED.
  (5) THE COMMISSIONER IS HEREBY DIRECTED TO PROMULGATE  ALL  RULES  AND
REGULATIONS,   AFTER  CONSULTATION  WITH  THE  DEPARTMENT  OF  FINANCIAL
SERVICES AND THE DEPARTMENT OF AGRICULTURE  AND  MARKETS,  NECESSARY  TO
IMPLEMENT  THE  PROVISIONS OF THIS SUBSECTION AND TO MAXIMIZE THE EFFECT
OF THIS SUBSECTION. THE COMMISSIONER AND THE SUPERINTENDENT OF FINANCIAL
SERVICES ARE HEREBY DIRECTED TO COOPERATE WITH EACH OTHER IN THE  ESTAB-
LISHMENT,  SUPERVISION  AND  REGULATION  OF  THE INDIVIDUAL FARM RESERVE
ACCOUNTS AUTHORIZED TO BE CREATED IN THIS SUBSECTION.
  S 3. This act shall take effect immediately and shall apply to taxable
years beginning on or after January 1, 2014.

                                 PART KK

  Section 1. Subsection (c) of section 612 of the tax law is amended  by
adding a new paragraph 40 to read as follows:
  (40)  THE  AMOUNT  THAT  MAY BE SUBTRACTED FROM FEDERAL ADJUSTED GROSS
INCOME PURSUANT TO SUBSECTION (W) OF THIS SECTION.
  S 2. Section 612 of the tax law is amended by adding a new  subsection
(w) to read as follows:
  (W)  CONTRIBUTIONS MADE TO A FARM PURCHASE ACCOUNT. (1) THERE SHALL BE
SUBTRACTED FROM FEDERAL ADJUSTED GROSS INCOME CONTRIBUTIONS MADE  BY  OR
ON  BEHALF  OF  A  FIRST  TIME FARM PURCHASER TO A FARM PURCHASE ACCOUNT
PROVIDED SUCH CONTRIBUTIONS SHALL NOT EXCEED FIVE THOUSAND  DOLLARS  FOR
AN  INDIVIDUAL  TAXPAYER  AND  SHALL NOT EXCEED TEN THOUSAND DOLLARS FOR
MARRIED TAXPAYERS.
  (2)  FIRST  TIME  FARM  PURCHASER.  (A)  FOR  THE  PURPOSES  OF   THIS
SUBSECTION, A "FIRST TIME FARM PURCHASER" SHALL MEAN AN INDIVIDUAL OR AN
INDIVIDUAL  AND  HIS OR HER SPOUSE, NONE OF WHOM HAS OR HAD AN OWNERSHIP
INTEREST IN QUALIFIED AGRICULTURAL PROPERTY AT ANY TIME.
  (B) FOR THE PURPOSES OF THIS SUBSECTION, "OWNERSHIP INTEREST" INCLUDES
THE FOLLOWING: A FEE SIMPLE INTEREST, A  JOINT  TENANCY,  A  TENANCY  IN
COMMON, A TENANCY BY THE ENTIRETY, THE INTEREST OF A TENANT-SHARE-HOLDER
IN A COOPERATIVE, A LIFE ESTATE AND A LAND CONTRACT.  INTERESTS WHICH DO
NOT  CONSTITUTE OWNERSHIP INTERESTS INCLUDE THE FOLLOWING: (I) REMAINDER
INTERESTS, (II) A LEASE WITH OR WITHOUT AN OPTION TO PURCHASE,  (III)  A
MERE  EXPECTANCY  TO  INHERIT AN INTEREST IN AGRICULTURAL PROPERTY, (IV)
THE  INTEREST  THAT  A  PURCHASER  OF  QUALIFIED  AGRICULTURAL  PROPERTY
ACQUIRES  ON THE EXECUTION OF A PURCHASE CONTRACT AND (V) AN INTEREST IN
REAL ESTATE OTHER THAN QUALIFIED AGRICULTURAL PROPERTY.
  (C) FOR THE PURPOSES OF THIS SUBSECTION, "QUALIFIED AGRICULTURAL PROP-
ERTY" MEANS LAND LOCATED IN THIS STATE WHICH  IS  USED  IN  AGRICULTURAL
PRODUCTION,  AND  LAND IMPROVEMENTS, STRUCTURES AND BUILDINGS (EXCLUDING
BUILDINGS USED FOR THE TAXPAYER'S RESIDENTIAL PURPOSE) LOCATED  ON  SUCH
LAND  WHICH ARE USED OR OCCUPIED TO CARRY OUT SUCH PRODUCTION. QUALIFIED
AGRICULTURAL PROPERTY ALSO INCLUDES LAND SET ASIDE OR  RETIRED  UNDER  A
FEDERAL  SUPPLY  MANAGEMENT OR SOIL CONSERVATION PROGRAM OR LAND THAT AT
THE TIME IT BECOMES SUBJECT TO A CONSERVATION EASEMENT, AS DEFINED UNDER
SUBSECTION (KK) OF SECTION SIX HUNDRED SIX  OF  THIS  ARTICLE,  MET  THE
REQUIREMENTS UNDER THIS PARAGRAPH.
  (D)  TO  ESTABLISH  THAT AN INDIVIDUAL IS A FIRST TIME FARM PURCHASER,
THE INDIVIDUAL SHALL COMPLETE  A  FORM  PROMULGATED  BY  THE  DEPARTMENT

S. 2609--C                         75

CERTIFYING,  UNDER  THE  PENALTIES OF PERJURY, THAT SUCH INDIVIDUAL IS A
FIRST TIME FARM PURCHASER.
  (E)  IN THE CASE OF AN INDIVIDUAL AND HIS OR HER SPOUSE, IF EITHER THE
INDIVIDUAL OR HIS OR HER SPOUSE IS NOT  A  FIRST  TIME  FARM  PURCHASER,
NEITHER  THE  INDIVIDUAL  OR  SPOUSE SHALL BE CONSIDERED FIRST TIME FARM
PURCHASERS.
  (F) IN THE CASE OF A CONTRIBUTION MADE BY AN INDIVIDUAL OTHER THAN THE
FIRST TIME FARM PURCHASER, SUCH INDIVIDUAL SHALL COMPLETE A FORM PROMUL-
GATED BY THE DEPARTMENT PROVIDING  THE  NAME  OF  THE  FIRST  TIME  FARM
PURCHASER,  ADDRESS,  AND  ANY  OTHER  INFORMATION  THE COMMISSIONER MAY
REQUIRE.
  (3) FOR PURPOSES OF THIS SUBSECTION A "FARM  PURCHASE  ACCOUNT"  SHALL
MEAN  AN  ACCOUNT  ORGANIZED  OR CREATED IN THIS STATE FOR THE EXCLUSIVE
BENEFIT OF AN INDIVIDUAL AND HIS OR HER SPOUSE WHO IS A FIRST TIME  FARM
PURCHASER.   EVERY SUCH ACCOUNT SHALL COMPLY WITH THE FOLLOWING REQUIRE-
MENTS:
  (A) THE ACCOUNT SHALL BE HELD IN A BANKING ORGANIZATION, AS DEFINED IN
SECTION TWO OF THE BANKING  LAW,  NATIONAL  BANKING  ASSOCIATION,  STATE
CHARTERED CREDIT UNION, FEDERAL MUTUAL SAVINGS BANK. FEDERAL SAVINGS AND
LOAN  ASSOCIATION,  OR  FEDERAL CREDIT UNION AND SUCH ACCOUNT WAS ESTAB-
LISHED PURSUANT TO THIS SUBSECTION.
  (B) ANY AMOUNT IN THE ACCOUNT IS NONFORFEITABLE.
  (C) THE FUNDS IN SUCH ACCOUNT SHALL NOT BE COMMINGLED WITH  ANY  OTHER
MONIES OF THE INDIVIDUAL BY THE TRUSTEE.
  (D)  MONIES WITHDRAWN FROM SUCH ACCOUNT AND INTEREST WHICH HAS ACCRUED
SHALL NOT BE CONSIDERED AS INCOME TO THE FIRST TIME FARM  PURCHASER  AND
TAXED  IF  THE MONIES ARE APPLIED FOR THE PURCHASE OF QUALIFIED AGRICUL-
TURAL PROPERTY.
  (4) WITHIN SIXTY DAYS AFTER WITHDRAWAL OF MONIES FROM A FARM  PURCHASE
ACCOUNT,  AN  INDIVIDUAL  SHALL SUBMIT SATISFACTORY PROOF TO THE COMMIS-
SIONER, UPON FORMS PROVIDED BY THE DEPARTMENT, THAT THE MONIES WITHDRAWN
WERE USED FOR THE PURCHASE OF QUALIFIED AGRICULTURAL PROPERTY.   IN  THE
EVENT  THAT  AN  INDIVIDUAL WITHDRAWS ALL OR ANY PART OF THE MONIES FROM
THE ACCOUNT AND DOES NOT EITHER APPLY THE  MONIES  TO  THE  PURCHASE  OF
QUALIFIED  AGRICULTURAL PROPERTY, OR FAILS TO SUBMIT TO THE COMMISSIONER
THE PROOF AS REQUIRED PURSUANT TO THIS PARAGRAPH, SUCH INDIVIDUAL  SHALL
HAVE  THE ENTIRE ACCOUNT TAXED, INCLUDING INTEREST WHICH HAS ACCRUED, AS
THOUGH IT WAS INCOME IN THE YEARS THAT THE MONIES FROM THE ACCOUNT  WERE
WITHDRAWN.  IN  THE  EVENT THAT AN INDIVIDUAL DOES NOT USE THE QUALIFIED
AGRICULTURAL PROPERTY FOR AGRICULTURAL PRODUCTION FOR A PERIOD  OF  LESS
THAN TWO YEARS AFTER THE PURCHASE, SUCH INDIVIDUAL SHALL HAVE THE ENTIRE
FARM  PURCHASE  ACCOUNT  TAXED, INCLUDING INTEREST WHICH HAS ACCRUED, AS
THOUGH IT WAS INCOME IN THE YEAR THAT THE MONIES FROM THE  ACCOUNT  WERE
WITHDRAWN. FOR THE PURPOSES OF THIS PARAGRAPH, THE TWO YEAR PERIOD SHALL
BEGIN  TO  RUN  AT THE TIME TITLE TO THE QUALIFIED AGRICULTURAL PROPERTY
PASSES TO THE INDIVIDUAL.
  (5) THE COMMISSIONER IS HEREBY DIRECTED TO PROMULGATE  ALL  RULES  AND
REGULATIONS,   AFTER  CONSULTATION  WITH  THE  DEPARTMENT  OF  FINANCIAL
SERVICES, NECESSARY TO IMPLEMENT THE PROVISIONS OF THIS  SUBSECTION  AND
TO  MAXIMIZE  THE  EFFECT  OF  THIS SUBSECTION. THE COMMISSIONER AND THE
SUPERINTENDENT OF FINANCIAL SERVICES ARE HEREBY  DIRECTED  TO  COOPERATE
WITH  EACH OTHER IN THE ESTABLISHMENT, SUPERVISION AND REGULATION OF THE
INDIVIDUAL FARM PURCHASE ACCOUNTS  AUTHORIZED  TO  BE  CREATED  IN  THIS
SUBSECTION.
  S 3. This act shall take effect immediately and shall apply to taxable
years beginning on or after January 1, 2014.

S. 2609--C                         76

                                 PART LL

  Section 1. Subsection (a) of section 951 of the tax law, as amended by
section  1  of  part  T of chapter 57 of the laws of 2010, is amended to
read as follows:
  (a) Dates. For purposes of this article, any reference to the internal
revenue code means the United States Internal Revenue Code of 1986, with
all amendments enacted on or before July twenty-second, nineteen hundred
ninety-eight, and, unless specifically provided otherwise in this  arti-
cle,  any  reference to December thirty-first, nineteen hundred seventy-
six or January first, nineteen hundred seventy-seven  contained  in  the
provisions of such code which are applicable to the determination of the
tax imposed by this article shall be read as a reference to June thirti-
eth,  nineteen  hundred  seventy-eight  or  July first, nineteen hundred
seventy-eight, respectively. Notwithstanding the foregoing, the  unified
credit  against  the  estate tax provided in section two thousand ten of
the internal revenue code shall, for purposes of this  article,  be  the
amount  allowable as if the federal applicable exclusion amount were one
million dollars OR FIVE MILLION DOLLARS FOR A FARM OPERATION, AS DEFINED
IN SECTION THREE HUNDRED ONE OF THE AGRICULTURE AND MARKETS LAW.
  S 2. This act shall take effect immediately and shall apply to taxable
years commencing on and after January 1, 2013.

                                 PART MM

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

S. 2609--C                         77

  (2) "FARMLAND AND FORESTLAND" SHALL MEAN LAND WHICH, DURING THE  TAXA-
BLE YEAR IN WHICH THE CREDIT IS CLAIMED PURSUANT TO THIS SUBDIVISION, IS
ELIGIBLE   FOR   AN   AGRICULTURAL   ASSESSMENT   PURSUANT   TO  ARTICLE
TWENTY-FIVE-AA OF THE AGRICULTURE AND MARKETS  LAW  OR  ELIGIBLE  FOR  A
FOREST ASSESSMENT SECTION FOUR HUNDRED EIGHTY-A OF THE REAL PROPERTY TAX
LAW.
  (3)  "NATURAL RESOURCE IMPROVEMENT PROJECT" SHALL MEAN THE RESTORATION
OF FARMLAND AND FORESTLANDS FOR THE PRODUCTION OF AGRICULTURAL PERENNIAL
CROPS, INCLUDING THOSE CROPS INTENDED FOR ENERGY PRODUCTION PURPOSES, BY
IMPROVING SUCH LAND WHICH HAS NOT BEEN USED IN  AGRICULTURAL  PRODUCTION
FOR  TWO  OR  MORE  YEARS PRIOR TO THE COMPLETION OF SUCH RESTORATION OR
FOREST HEALTH IMPROVEMENTS REQUIRED IN THE MANAGEMENT PLAN.
  (C) APPLICATION OF CREDIT. THE CREDIT ALLOWED UNDER  THIS  SUBDIVISION
FOR A TAXABLE YEAR MAY NOT REDUCE THE TAX DUE FOR SUCH YEAR TO LESS THAN
THE  AMOUNT  PRESCRIBED  IN  PARAGRAPH  (D)  OF  SUBDIVISION ONE OF THIS
SECTION.  HOWEVER, IF THE AMOUNT OF THE CREDIT ALLOWED UNDER THIS SUBDI-
VISION FOR ANY TAXABLE YEAR REDUCES THE TAX TO SUCH AMOUNT,  ANY  AMOUNT
OF CREDIT THUS NOT DEDUCTIBLE IN SUCH TAXABLE YEAR WILL 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 EIGHT-
Y-EIGHT OF THIS CHAPTER NOTWITHSTANDING, NO INTEREST WILL BE PAID THERE-
ON.
  S  3. Subparagraph (B) of paragraph 1 of subsection (i) of section 606
of the tax law is amended by adding a  new  clause  (xxxv)  to  read  as
follows:

(XXXV) NATURAL RESOURCES             AMOUNT OF CREDIT FOR ELIGIBLE
IMPROVEMENT CREDIT FOR FARMLANDS     EXPENDITURES FOR A NATURAL RESOURCE
UNDER SUBSECTION (VV)                IMPROVEMENT PROJECT UNDER
                                     SUBDIVISION FORTY-FIVE OF SECTION
                                     TWO HUNDRED TEN

  S  4. Section 606 of the tax law is amended by adding a new subsection
(vv) to read as follows:
  (VV) NATURAL RESOURCE IMPROVEMENT CREDIT  FOR  FARMLANDS  AND  FOREST-
LANDS.  (1) ALLOWANCE OF CREDIT. FOR TAXABLE YEARS BEGINNING ON OR AFTER
JANUARY FIRST, TWO THOUSAND THIRTEEN, A  TAXPAYER  SHALL  BE  ALLOWED  A
CREDIT  AGAINST  THE  TAX  IMPOSED BY THIS ARTICLE IN AN AMOUNT EQUAL TO
TWENTY-FIVE PERCENT OF THE TAXPAYER'S ELIGIBLE EXPENDITURES  DURING  THE
TAX YEAR FOR A NATURAL RESOURCE IMPROVEMENT PROJECT.  PROVIDED, HOWEVER,
THAT  THE  CREDIT  GRANTED FOR ANY NATURAL RESOURCES IMPROVEMENT PROJECT
PURSUANT TO THIS SUBSECTION SHALL NOT EXCEED FIFTY THOUSAND DOLLARS.
  (2) DEFINITIONS. FOR THE PURPOSES OF THIS  SUBSECTION,  THE  FOLLOWING
DEFINITIONS SHALL APPLY:
  (A) "ELIGIBLE EXPENDITURES" SHALL MEAN FEES FOR ARCHITECTURAL, ARCHEO-
LOGICAL,  GEOLOGICAL  AND  ENGINEERING SERVICES; THE COSTS OF DEVELOPING
PLANS AND SPECIFICATIONS; FEES FOR CONSULTANT AND  LEGAL  SERVICES;  AND
ANY  EXPENDITURE  SPECIFIED  IN INTERNAL REVENUE CODE SECTION 175(C)(1),
INCLUDING EXPENDITURES RELATED TO THE APPLICATION OF LIME AND  FERTILIZ-
ER,  IMPROVEMENT  OF  DRAINAGE  IN THE CASE OF OPEN AREAS THAT HAVE BEEN
USED FOR AGRICULTURAL PURPOSES AT ANY TIME IN THE PAST, AND EXPENDITURES
RELATED TO THE DECONSTRUCTION AND REMOVAL OF  FENCES,  STREAM  CROSSINGS
AND  NECESSARY  RIPARIAN BUFFERS AND FORESTLAND IMPROVEMENTS AS REQUIRED
BY THE NATURAL RESOURCE IMPROVEMENT PROJECT.

S. 2609--C                         78

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

                                 PART NN

  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 biofuel
produced at a biofuel plant on or after January first, two thousand  six
shall equal fifteen cents per gallon OR TWENTY-FIVE CENTS PER GALLON FOR
PRODUCTION OF CELLULOSIC ETHANOL after the production of the first forty
thousand  gallons  per  year  presented to market. The credit under this
section shall be capped at two and one-half million dollars per taxpayer
per taxable year for up to no more than four consecutive  taxable  years
per  biofuel  plant.  If  the  taxpayer is a partner in a partnership 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 million
dollars.  The tax credit allowed pursuant to this section shall apply to
taxable years beginning before January first, two thousand twenty.

S. 2609--C                         79

  (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. 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 Socie-
ty of Testing and Materials 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.
  (2) "CELLULOSIC ETHANOL" MEANS THE PRODUCTION OF ETHANOL  FROM  LIGNO-
CELLULOSIC  BIOMASS  FEEDSTOCKS  NOT  USED  FOR FOOD PRODUCTION 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,  AGRICUL-
TURAL  AND FORESTRY RESIDUES, 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 PARAGRAPH SHALL BE DETERMINED
BY  THE  PRESIDENT OF THE NEW YORK STATE ENERGY AND RESEARCH DEVELOPMENT
AUTHORITY IN CONSULTATION WITH THE COMMISSIONER OF ENVIRONMENTAL CONSER-
VATION AND THE COMMISSIONER OF AGRICULTURE AND MARKETS.
  (3) "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  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,
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

S. 2609--C                         80

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.

                                 PART OO

  Section 1. Paragraph (a) of subdivision 1 of section 471-b of the  tax
law,  as  amended  by section 18 of part D of chapter 134 of the laws of
2010, is amended to read as follows:
  (a) Such tax on tobacco products other than CIGARS, snuff  and  little
cigars  shall  be  at  the rate of seventy-five percent of the wholesale
price, and is intended to be imposed only once  upon  the  sale  of  any
tobacco products other than snuff and little cigars.
  S  2.  Subdivision  1  of  section  471-b of the tax law is amended by
adding a new paragraph (d) to read as follows:
  (D) SUCH TAX ON CIGARS SHALL BE AT THE RATE OF SEVENTY-FIVE PERCENT OF
THE WHOLESALE PRICE OR FIFTY CENTS PER CIGAR, WHICHEVER IS LESS.

S. 2609--C                         81

  S 3. Paragraph (i) of subdivision (a) of section 471-c of the tax law,
as amended by section 20 of part D of chapter 134 of the laws  of  2010,
is amended to read as follows:
  (i)  Such  tax on tobacco products other than CIGARS, snuff and little
cigars shall be at the rate of seventy-five  percent  of  the  wholesale
price.
  S  4.  Subdivision  (a)  of section 471-c of the tax law is amended by
adding a new paragraph (iv) to read as follows:
  (IV) SUCH TAX ON CIGARS SHALL BE AT THE RATE OF  SEVENTY-FIVE  PERCENT
OF THE WHOLESALE PRICE OR FIFTY CENTS PER CIGAR, WHICHEVER IS LESS.
  S 5. This act shall take effect immediately.

                                 PART PP

  Section  1. The opening paragraph of subdivision 1 of section 471-b of
the tax law, as amended by section 2 of part QQ1 of chapter  57  of  the
laws of 2008, is amended to read as follows:
  There  is  hereby  imposed  and  shall  be  paid  a tax on all tobacco
products [possessed in this state by any person for sale] SOLD,  SHIPPED
OR  DELIVERED  WITHIN THIS STATE BY ANY PERSON, except that no tax shall
be imposed on tobacco products sold under such circumstances  that  this
state is without power to impose such tax, or sold to the United States,
or  sold  to  or by a voluntary unincorporated organization of the armed
forces of the United States operating a place  for  the  sale  of  goods
pursuant  to regulations promulgated by the appropriate executive agency
of the United States, to the extent provided  in  such  regulations  and
policy statements of such an agency applicable to such sales.
  S  2. Subdivision 1 of section 473-a of the tax law, as added by chap-
ter 61 of the laws of 1989, is amended to read as follows:
  1. Every distributor shall, on or before the  twentieth  day  of  each
month,  file  with  the commissioner of taxation and finance a return on
forms to be prescribed and furnished by the  commissioner,  showing  the
quantity and wholesale price of all tobacco products [imported or caused
to  be  imported  into  the state by him or manufactured in the state by
him], SOLD, SHIPPED OR DELIVERED WITHIN THIS STATE BY  SUCH  DISTRIBUTOR
during the preceding calendar month. Every distributor authorized by the
commissioner  to  make returns and pay the tax on tobacco products sold,
shipped or delivered by [him] SUCH DISTRIBUTOR  to  any  person  in  the
state  shall  file  a return showing the quantity and wholesale price of
all tobacco products so sold, shipped or delivered during the  preceding
calendar  month.  Provided,  however, the commissioner may, if he OR SHE
deems it necessary in order to insure the payment of the  taxes  imposed
by  this  article, require returns to be made at such times and covering
such periods as he OR SHE may deem necessary, and,  by  regulation,  may
permit  the  filing  of  returns  on  a quarterly, semi-annual or annual
basis, or may waive the filing of returns by a distributor for such time
and upon such terms as he OR SHE may deem proper if  satisfied  that  no
tax imposed by this article is or will be payable by [him] SUCH DISTRIB-
UTOR  during  the  time for which returns are waived. Such returns shall
contain such further information as the commissioner may require.
  S 3. The commissioner of taxation and finance shall  establish  proce-
dures  to  provide  for  a credit against taxes paid by distributors for
periods prior to the effective date of this act to offset the taxes  due
on or after the effective date of this act.
  S  4.  This  act  shall take effect on the first day of the next month
subsequent to at least ninety days after this act shall  have  become  a

S. 2609--C                         82

law; provided, however, that the commissioner of taxation and finance is
authorized,  on  and after the date this act shall have become a law, to
adopt and amend any rules, regulations and issue any  procedures,  forms
or instructions necessary for the implementation of this act.

                                 PART QQ

  Section  1. Paragraphs (a), (b) and (h) of subdivision 12-G of section
210 of the tax law, as amended by section 1-a of part A of chapter 63 of
the laws of 2005, are amended and a new paragraph (a-1) is added to read
as follows:
  (a) [A] FOR TAXABLE YEARS BEGINNING ON AND AFTER  JANUARY  FIRST,  TWO
THOUSAND SIX AND PRIOR TO JANUARY FIRST, TWO THOUSAND TWELVE, A taxpayer
that  is  a  qualified  emerging  technology  company  pursuant  to  the
provisions of section thirty-one hundred two-e  [(and  specifically  for
the  activities  referenced  in paragraph (b) of subdivision one of such
section thirty-one hundred two-e)] of the public  authorities  law,  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), (d), and (e) of this subdivision subject to the
limitations in paragraph (f) of this subdivision.
  (A-1)  FOR  TAXABLE  YEARS  BEGINNING  ON AND AFTER JANUARY FIRST, TWO
THOUSAND THIRTEEN, A TAXPAYER THAT IS A  QUALIFIED  EMERGING  TECHNOLOGY
COMPANY  PURSUANT TO THE PROVISIONS OF SUBPARAGRAPH ONE OF PARAGRAPH (C)
OF SUBDIVISION ONE OF SECTION THIRTY-ONE HUNDRED  TWO-E  OF  THE  PUBLIC
AUTHORITIES  LAW,  AND  THAT MEETS THE ELIGIBILITY REQUIREMENTS IN PARA-
GRAPH (B) OF THIS SUBDIVISION, SHALL BE ALLOWED A CREDIT AGAINST THE TAX
IMPOSED BY THIS ARTICLE. THE AMOUNT OF CREDIT SHALL BE EQUAL TO THE  SUM
OF  THE AMOUNTS SPECIFIED IN PARAGRAPHS (C), (D), AND (E) OF THIS SUBDI-
VISION SUBJECT TO THE LIMITATIONS IN PARAGRAPH (F) OF THIS SUBDIVISION.
  (b) An eligible taxpayer shall (i) have no more than one hundred full-
time employees, of which at least seventy-five percent are  employed  in
New  York  state,  EXCEPT  AS OTHERWISE PROVIDED IN THIS PARAGRAPH, (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 six percent during its taxable year, and (iii)
have gross revenues, along with the gross revenues of its affiliates and
related members, not exceeding twenty million dollars  for  the  taxable
year  immediately  preceding  the  year the taxpayer is allowed a credit
under this  subdivision.  For  purposes  of  this  paragraph,  the  term
"related member" shall have the same meaning as set forth in clauses (A)
and  (B)  of  subparagraph  one  of paragraph (o) of subdivision nine of
section two hundred eight of this article,  and  the  term  "affiliates"
shall  mean  those  corporations that are members of the same affiliated
group (as defined in section fifteen hundred four of the internal reven-
ue code) as the taxpayer. FOR PURPOSES OF SUBPARAGRAPH (I) OF THIS PARA-
GRAPH, EMPLOYEES WHO ARE EMPLOYED OUTSIDE THE UNITED STATES  DURING  THE
TAXABLE  YEAR SHALL NOT BE CONSIDERED; A TAXPAYER THAT MEETS THE EMPLOY-
MENT REQUIREMENTS IN SUBPARAGRAPH (I) OF THIS  PARAGRAPH  IN  THE  FIRST
YEAR IN WHICH THE CREDIT ALLOWED BY THIS SUBDIVISION IS CLAIMED WILL NOT
BE  CONSIDERED  INELIGIBLE  SOLELY  AS  A RESULT OF HAVING MORE THAN ONE
HUNDRED FULL-TIME EMPLOYEES IN OTHER TAXABLE YEARS IN WHICH  THE  CREDIT
IS  CLAIMED,  PROVIDED  AT  LEAST  SEVENTY-FIVE PERCENT OF THE FULL-TIME
EMPLOYEES IN THE OTHER TAXABLE YEARS ARE EMPLOYED IN NEW YORK STATE; AND
AN INDIVIDUAL WHO IS A PARTNER IN A  PARTNERSHIP  THAT  IS  A  QUALIFIED

S. 2609--C                         83

EMERGING  TECHNOLOGY  COMPANY WILL BE CONSIDERED A FULL-TIME EMPLOYEE IF
THE INDIVIDUAL PARTNER PARTICIPATES IN THE PARTNERSHIP  ON  A  FULL-TIME
BASIS  DURING  THE  TAXABLE  YEAR  AND THE INVOLVEMENT OF THE INDIVIDUAL
PARTNER  IN  THE  ACTIVITIES  OF THE PARTNERSHIP DURING THE TAXABLE YEAR
SATISFIES THE REQUIREMENTS FOR MATERIAL PARTICIPATION FOR THE SAME TAXA-
BLE YEAR WITHIN THE MEANING OF SUBSECTION (H)  OF  SECTION  469  OF  THE
INTERNAL REVENUE CODE.
  [(h) The credit allowed under this subdivision shall not be applicable
for  taxable  years  beginning  on  or after January first, two thousand
twelve.]
  S 2. Paragraphs 1, 2 and 8 of subsection (nn) of section  606  of  the
tax  law,  as amended by section 1-a of part A of chapter 63 of the laws
of 2005, are amended and a  new  paragraph  1-a  is  added  to  read  as
follows:
  (1)  [A]  FOR  TAXABLE YEARS BEGINNING ON AND AFTER JANUARY FIRST, TWO
THOUSAND SIX AND PRIOR TO JANUARY FIRST, TWO THOUSAND TWELVE, A taxpayer
that  is  a  qualified  emerging  technology  company  pursuant  to  the
provisions  of  section  thirty-one hundred two-e [(and specifically for
the activities referenced in paragraph (b) of subdivision  one  of  such
section  thirty-one  hundred  two-e)] of the public authorities law, 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, four, and five of this subsection, subject  to  the
limitations in paragraph six of this subsection.
  (1-A)  FOR  TAXABLE  YEARS  BEGINNING  ON AND AFTER JANUARY FIRST, TWO
THOUSAND THIRTEEN, A TAXPAYER THAT IS A  QUALIFIED  EMERGING  TECHNOLOGY
COMPANY  PURSUANT TO THE PROVISIONS OF SUBPARAGRAPH ONE OF PARAGRAPH (C)
OF SUBDIVISION ONE OF SECTION THIRTY-ONE HUNDRED  TWO-E  OF  THE  PUBLIC
AUTHORITIES  LAW,  AND  THAT MEETS THE ELIGIBILITY REQUIREMENTS IN PARA-
GRAPH 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,  FOUR,  AND  FIVE  OF  THIS
SUBSECTION,  SUBJECT  TO  THE  LIMITATIONS  IN  PARAGRAPH  SIX  OF  THIS
SUBSECTION.
  (2) An eligible taxpayer shall (i) have no more than one hundred full-
time  employees,  of which at least seventy-five percent are employed in
New York state, EXCEPT AS OTHERWISE PROVIDED IN THIS PARAGRAPH,
  (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 authori-
ties law, which equals or exceeds six percent during its  taxable  year,
and
  (iii) have gross revenues, along with the gross revenues of its affil-
iates  and related members, not exceeding twenty million dollars for the
taxable year immediately preceding the year the taxpayer  is  allowed  a
credit  under  this subsection. For purposes of this paragraph, the term
"related member" shall have the same meaning as set forth in clauses (A)
and (B) of subparagraph one of paragraph (o) of subdivision [9] NINE  of
section  two  hundred  eight  of this chapter, and the term "affiliates"
shall mean those corporations that are members of  the  same  affiliated
group (as defined in section fifteen hundred four of the internal reven-
ue code) as the taxpayer. FOR PURPOSES OF SUBPARAGRAPH (I) OF THIS PARA-
GRAPH,  EMPLOYEES  WHO ARE EMPLOYED OUTSIDE THE UNITED STATES DURING THE
TAXABLE YEAR SHALL NOT BE CONSIDERED; A TAXPAYER THAT MEETS THE  EMPLOY-

S. 2609--C                         84

MENT  REQUIREMENTS  IN  SUBPARAGRAPH  (I) OF THIS PARAGRAPH IN THE FIRST
YEAR IN WHICH THE CREDIT ALLOWED BY THIS SUBSECTION IS CLAIMED WILL  NOT
BE  CONSIDERED  INELIGIBLE  SOLELY  AS  A RESULT OF HAVING MORE THAN ONE
HUNDRED  FULL-TIME  EMPLOYEES IN OTHER TAXABLE YEARS IN WHICH THE CREDIT
IS CLAIMED, PROVIDED AT LEAST  SEVENTY-FIVE  PERCENT  OF  THE  FULL-TIME
EMPLOYEES IN THE OTHER TAXABLE YEARS ARE EMPLOYED IN NEW YORK STATE; AND
AN  INDIVIDUAL  WHO  IS  A  PARTNER IN A PARTNERSHIP THAT IS A QUALIFIED
EMERGING TECHNOLOGY COMPANY WILL BE CONSIDERED A FULL-TIME  EMPLOYEE  IF
THE  INDIVIDUAL  PARTNER  PARTICIPATES IN THE PARTNERSHIP ON A FULL-TIME
BASIS DURING THE TAXABLE YEAR AND  THE  INVOLVEMENT  OF  THE  INDIVIDUAL
PARTNER  IN  THE  ACTIVITIES  OF THE PARTNERSHIP DURING THE TAXABLE YEAR
SATISFIES THE REQUIREMENTS FOR MATERIAL PARTICIPATION FOR THE SAME TAXA-
BLE YEAR WITHIN THE MEANING OF SUBSECTION (H)  OF  SECTION  469  OF  THE
INTERNAL REVENUE CODE.
  [(8)  The credit allowed under this subsection shall not be applicable
for taxable years beginning on or  after  January  first,  two  thousand
twelve.]
  S  3. This act shall take effect immediately; provided that the amend-
ments to paragraph (b) of subdivision 12-G of section 210 of the tax law
made by section one of this act and the amendments  to  paragraph  2  of
subsection  (nn)  of  section  606 of the tax law made by section two of
this act shall apply to taxable years beginning  January  1,  2013;  and
provided,  further  that  the amendments to paragraph (a) of subdivision
12-G of section 210 of the tax law made by section one of this act shall
be applicable to taxable years beginning on or after January 1, 2006 and
prior to January 1, 2012.

                                 PART RR

  Section 1. Subsection (c) of section 612 of the tax law is amended  by
adding a new paragraph 39 to read as follows:
  (39)  FOR  TAXABLE  YEARS  BEGINNING  AFTER DECEMBER THIRTY-FIRST, TWO
THOUSAND TWELVE THE AMOUNT OF QUALIFIED TRANSPORTATION  FRINGE  BENEFITS
INCLUDED IN FEDERAL ADJUSTED GROSS INCOME, TO THE EXTENT THAT SUCH QUAL-
IFIED TRANSPORTATION FRINGE BENEFITS WOULD HAVE BEEN EXCLUDED FROM GROSS
INCOME  PURSUANT  TO  PARAGRAPH  FIVE  OF  SUBSECTION (A) OF SECTION ONE
HUNDRED THIRTY-TWO OF THE INTERNAL REVENUE CODE HAD THE  FLUSH  SENTENCE
OF  PARAGRAPH TWO OF SUBSECTION (F) OF SECTION ONE HUNDRED THIRTY-TWO OF
THE INTERNAL REVENUE CODE THAT WAS IN EFFECT ON  DECEMBER  THIRTY-FIRST,
TWO THOUSAND ELEVEN CONTINUED IN EFFECT AFTER DECEMBER THIRTY-FIRST, TWO
THOUSAND  ELEVEN;  PROVIDED,  HOWEVER, THAT IF SUBPARAGRAPH (A) OF PARA-
GRAPH TWO OF SUBSECTION (F) OF SECTION ONE  HUNDRED  THIRTY-TWO  OF  THE
INTERNAL REVENUE CODE IS AMENDED SO THAT FOR ANY MONTH THE DOLLAR AMOUNT
IN  EFFECT UNDER SUCH SUBPARAGRAPH (A) IS GREATER THAN THE DOLLAR AMOUNT
IN EFFECT UNDER SUBPARAGRAPH (B) OF PARAGRAPH TWO OF SUBSECTION  (F)  OF
SECTION ONE HUNDRED THIRTY-TWO OF THE INTERNAL REVENUE CODE FOR THE SAME
MONTH,  THE FLUSH SENTENCE OF PARAGRAPH TWO THAT WAS IN EFFECT ON DECEM-
BER THIRTY-FIRST, TWO THOUSAND ELEVEN SHALL BE DEEMED  TO  PROVIDE  THAT
THE  DOLLAR AMOUNT IN EFFECT FOR SUBPARAGRAPH (B) SHALL BE APPLIED AS IF
THE DOLLAR AMOUNT THEREIN WERE THE SAME AS THE DOLLAR AMOUNT  IN  EFFECT
FOR  SUCH  MONTH  UNDER SUBPARAGRAPH (A). NOTWITHSTANDING THE FOREGOING,
IF, PURSUANT TO THIS PARAGRAPH, THE AMOUNT THAT WOULD BE IN  EFFECT  FOR
ANY  MONTH  UNDER SUBPARAGRAPH (A) OR (B) OF PARAGRAPH TWO OF SUBSECTION
(F) OF SECTION ONE HUNDRED THIRTY-TWO OF THE INTERNAL  REVENUE  CODE  IS
LESS  THAN  ONE  HUNDRED SEVENTY-FIVE DOLLARS, SUBPARAGRAPHS (A) AND (B)

S. 2609--C                         85

SHALL BE APPLIED AS IF THE DOLLAR AMOUNT IN EFFECT FOR SUCH MONTH  UNDER
SUCH SUBPARAGRAPHS WAS ONE HUNDRED SEVENTY-FIVE DOLLARS.
  S 2. This act shall take effect immediately.

                                 PART SS

  Section 1. The tax law is amended by adding a new section 23-a to read
as follows:
  S  23-A. ASBESTOS REMEDIATION CREDIT. (A) DEFINITIONS. AS USED IN THIS
SECTION, THE FOLLOWING TERMS SHALL HAVE THE FOLLOWING MEANINGS:
  (1) QUALIFIED STRUCTURE. "QUALIFIED STRUCTURE" SHALL MEAN (I) A BUILD-
ING, PRINCIPALLY USED  BY  THE  TAXPAYER  FOR  RESIDENTIAL,  INDUSTRIAL,
COMMERCIAL,  RECREATIONAL  OR  ENVIRONMENTAL  CONSERVATION PURPOSES, AND
(II) WHICH WAS ORIGINALLY PLACED IN SERVICE AT LEAST  TWENTY-FIVE  YEARS
PRIOR TO THE TAXABLE YEAR IN WHICH THE CREDIT IS CLAIMED.
  (2)  ELIGIBLE  COSTS. "ELIGIBLE COSTS" SHALL MEAN ALL AMOUNTS PROPERLY
CHARGEABLE TO A CAPITAL ACCOUNT, WHICH ARE INCURRED IN DIRECT CONNECTION
TO ASBESTOS REMEDIATION OF A QUALIFIED ASBESTOS PROJECT.
  (3) QUALIFIED ASBESTOS PROJECT. "QUALIFIED ASBESTOS PROJECT" SHALL  BE
AN  ASBESTOS PROJECT AS DEFINED IN SECTION NINE HUNDRED ONE OF THE LABOR
LAW AND UNDERTAKEN BY  THE  TAXPAYER,  ON  A  QUALIFIED  STRUCTURE,  AND
COMPLETED  PURSUANT  TO  THE APPLICABLE REGULATIONS AT PART FIFTY-SIX OF
TITLE TWELVE OF THE OFFICIAL COMPILATION OF RULES AND REGULATIONS OF THE
STATE.
  (B) ASBESTOS REMEDIATION CREDIT. (1) ALLOWANCE OF CREDIT.  A  TAXPAYER
WHO  HAS  UNDERTAKEN  A QUALIFIED ASBESTOS PROJECT ON A QUALIFIED STRUC-
TURE, AND WHO IS 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 (C) OF THIS SECTION.
  (2) AMOUNT OF CREDIT. THE AMOUNT OF THE CREDIT SHALL BE TWENTY PERCENT
OF ALL ELIGIBLE COSTS WHICH ARE INCURRED  IN  THE  TAXABLE  YEAR,  AS  A
RESULT  OF  ASBESTOS  REMEDIATION  WITH  A  COMPLETED QUALIFIED ASBESTOS
PROJECT. THE CREDIT SHALL BE ALLOWED FOR THE TAXABLE YEAR IN  WHICH  THE
QUALIFIED  ASBESTOS  PROJECT  IS  FIRST  COMMENCED  AND FOR THE NEXT TWO
SUCCEEDING TAXABLE YEARS. THE CREDIT AUTHORIZED PURSUANT TO THIS SECTION
SHALL NOT EXCEED THE TOTAL SUM OF ONE  MILLION  DOLLARS  FOR  THE  THREE
TAXABLE YEARS ALLOWED AND CLAIMED. THE COSTS, EXPENSES AND OTHER AMOUNTS
FOR  WHICH  A CREDIT IS ALLOWED AND CLAIMED UNDER THIS SUBDIVISION SHALL
NOT BE USED IN THE CALCULATION OF ANY OTHER CREDIT  ALLOWED  UNDER  THIS
CHAPTER.
  (C)  CROSS-REFERENCES.  FOR  APPLICATION OF THE CREDIT PROVIDED FOR IN
THIS SECTION, SEE THE FOLLOWING PROVISIONS OF THIS CHAPTER:
  ARTICLE 9: SECTION 187-S.
  ARTICLE 9-A: SECTION 210, SUBDIVISION 46.
  ARTICLE 22: SECTION 606, SUBSECTIONS (I) AND (VV).
  S 2. The tax law is amended by adding a new section 187-s to  read  as
follows:
  S  187-S.  ASBESTOS  REMEDIATION  CREDIT.  1.  ALLOWANCE  OF CREDIT. A
TAXPAYER SHALL BE ALLOWED A  CREDIT,  TO  BE  COMPUTED  AS  PROVIDED  IN
SECTION  TWENTY-THREE-A  OF  THIS  CHAPTER, AGAINST THE TAXES IMPOSED BY
THIS ARTICLE. PROVIDED, HOWEVER, THAT THE AMOUNT OF SUCH  CREDIT  ALLOW-
ABLE  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.

S. 2609--C                         86

  2. APPLICATION OF CREDIT. THE CREDIT UNDER THIS SECTION FOR ANY  TAXA-
BLE  YEAR  SHALL  NOT  REDUCE THE TAX DUE FOR SUCH YEAR TO LESS THAN THE
APPLICABLE MINIMUM TAX PRESCRIBED BY  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 SHALL BE TREATED  AS  AN  OVERPAYMENT  OF  TAX  TO  BE
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.
  S 3. Section 210 of the tax law is amended by adding a new subdivision
46 to read as follows:
  46. ASBESTOS REMEDIATION CREDIT. (A) ALLOWANCE OF CREDIT.  A  TAXPAYER
WHO HAS UNDERTAKEN A QUALIFIED ASBESTOS PROJECT ON AN EXISTING STRUCTURE
SHALL  BE  ALLOWED A CREDIT, TO BE COMPUTED AS PROVIDED IN SECTION TWEN-
TY-THREE-A OF THIS CHAPTER, 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 HIGHER AMOUNT PRESCRIBED IN PARAGRAPHS (C) AND (D) OF  SUBDIVI-
SION  ONE  OF  THIS  SECTION.  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.
  S 4. Subparagraph (B) of paragraph 1 of subsection (i) of section  606
of  the  tax  law  is  amended by adding a new clause (xxxvi) to read as
follows:

(XXXVI) ASBESTOS REMEDIATION         AMOUNT OF CREDIT UNDER
CREDIT UNDER SUBSECTION (VV)         SUBDIVISION FORTY-SIX OF
                                     SECTION TWO HUNDRED TEN
  S 5. Section 606 of the tax law is amended by adding a new  subsection
(vv) to read as follows:
  (VV)  ASBESTOS REMEDIATION CREDIT. (1) ALLOWANCE OF CREDIT. A TAXPAYER
WHO HAS UNDERTAKEN A QUALIFIED ASBESTOS PROJECT ON AN EXISTING STRUCTURE
SHALL BE ALLOWED A CREDIT, TO BE COMPUTED AS PROVIDED IN  SECTION  TWEN-
TY-THREE-A OF THIS CHAPTER, AGAINST THE TAX IMPOSED BY THIS ARTICLE.
  (2)  APPLICATION  OF CREDIT. 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 ACCORDANCE WITH THE PROVISIONS OF SECTION SIX
HUNDRED EIGHTY-SIX OF THIS ARTICLE, PROVIDED, HOWEVER, THAT NO  INTEREST
SHALL BE PAID THEREON.
  S 6. This act shall take effect immediately and shall apply to taxable
years commencing on or after January 1, 2013.

                                 PART TT

  Section  1.  This act shall be known and may be cited as the "New York
aviation jobs act".
  S 2. Paragraph 1 of subdivision (dd) of section 1115 of the  tax  law,
as  added  by  section 1 of part L of chapter 60 of the laws of 2004, is
amended to read as follows:

S. 2609--C                         87

  (1) Services otherwise taxable under paragraph  three  of  subdivision
(c)  of  section eleven hundred five or under section eleven hundred ten
of this article,  SALES  OF  GENERAL  AVIATION  AIRCRAFT,  and  tangible
personal  property  purchased  and  used  by  the  person who sells such
services  in  performing  such  services,  where such property becomes a
physical component part of the property  upon  which  the  services  are
performed  or  where  such  property is a lubricant applied to aircraft,
shall be exempt from tax under this  article  where  such  services  are
performed on aircraft.
  S 3. This act shall take effect June 1, 2013, and shall apply to sales
made,  and  uses  occurring on or after such date in accordance with the
applicable transitional provisions of sections 1106 and 1217 of the  tax
law.    The  commissioner  of  taxation and finance shall be immediately
authorized to adopt and amend any rules or  regulations  and  issue  any
procedure,  forms or instructions necessary to implement this act on its
effective date.

                                 PART UU

  Section 1. Paragraph 1 of subdivision (a) of section 1115 of  the  tax
law,  as  amended  by  section  1 of part O of chapter 63 of the laws of
2000, is amended to read as follows:
  (1) Food, food products, beverages, dietary foods and  health  supple-
ments,  sold  for  human  consumption  but  not  including (i) candy and
confectionery, (ii) fruit drinks which contain less than seventy percent
of natural fruit juice, (iii) soft drinks, sodas and beverages  such  as
are  ordinarily  dispensed  at soda fountains or in connection therewith
(other than coffee, tea and cocoa) and (iv) beer, wine or other alcohol-
ic beverages, all of which shall be subject  to  the  retail  sales  and
compensating  use taxes, whether or not the item is sold in liquid form.
The food and drink excluded from the exemption provided  by  this  para-
graph under subparagraphs (i), (ii) and (iii) of this paragraph shall be
exempt  under  this  paragraph  when  sold  for [seventy-five cents] ONE
DOLLAR AND FIFTY CENTS or less through any vending machine activated  by
the use of coin, currency, credit card or debit card. With the exception
of  the  provision  in  this  paragraph  providing  for an exemption for
certain food or drink sold for [seventy-five cents] ONE DOLLAR AND FIFTY
CENTS  or  less  through  vending  machines,  nothing  herein  shall  be
construed as exempting food or drink from the tax imposed under subdivi-
sion (d) of section eleven hundred five OF THIS ARTICLE.
  S 2. This act shall take effect September 1, 2013.

                                 PART VV

  Section  1.  The public service law is amended by adding a new section
73 to read as follows:
  S 73. COORDINATION WITH CERTAIN PROVISIONS OF THE TAX LAW. THE DEPART-
MENT MAY REQUEST FROM THE DEPARTMENT OF TAXATION AND FINANCE A  LIST  OF
ELECTRIC  GENERATING  FACILITIES THAT HAVE BEEN GRANTED A CLEAN FUEL AND
JOB  CREATION  TAX  CREDIT  AS  SUCH  CREDIT  IS  DESCRIBED  IN  SECTION
THIRTY-EIGHT  OF THE TAX LAW. THE LIST SHALL INCLUDE THE LOCATION OF THE
FACILITY RECEIVING THE CREDIT, A DESCRIPTION OF THE PROJECT TO WHICH THE
CREDIT RELATES, THE AMOUNT OF THE CREDIT, AND THE TAX YEAR FOR WHICH THE
CREDIT WAS GRANTED.
  S 2. The tax law is amended by adding a new  section  38  to  read  as
follows:

S. 2609--C                         88

  S 38. CLEAN FUEL AND JOB CREATION TAX CREDIT. (A) ALLOWANCE OF CREDIT.
A  TAXPAYER  SUBJECT  TO TAX UNDER ARTICLE NINE, NINE-A OR TWENTY-TWO OF
THIS CHAPTER, WHICH IS AN ELECTRIC GENERATING FACILITY, SHALL BE ALLOWED
A CREDIT AGAINST SUCH TAX, PURSUANT  TO  THE  PROVISIONS  REFERENCED  IN
SUBDIVISION  (C)  OF  THIS  SECTION.    THE  CREDIT SHALL BE ALLOWED FOR
CERTAIN INVESTMENTS MADE BY ANY MAJOR ELECTRIC  GENERATING  FACILITY  IN
THE  STATE  SUCH AS REPOWERING PROJECTS, QUALIFIED ENERGY INFRASTRUCTURE
INVESTMENTS, AND QUALIFIED NEW CONSTRUCTION  PROJECTS  AS  DESCRIBED  IN
THIS SECTION. THE CREDIT SHALL BE AS FOLLOWS:
  (1)  TWELVE  AND  ONE-HALF  PERCENT  OF  THE FIRST ONE HUNDRED MILLION
DOLLARS IN INVESTMENT;
  (2) FIFTEEN PERCENT OF THE NEXT ONE HUNDRED MILLION DOLLARS IN INVEST-
MENT OR PORTION THEREOF; AND
  (3) TWENTY PERCENT OF THE INVESTMENT OVER TWO HUNDRED MILLION DOLLARS.
  (B) DEFINITIONS. AS USED IN THIS SECTION, THE  FOLLOWING  TERMS  SHALL
HAVE THE FOLLOWING MEANINGS:
  (1)  "REPOWERING PROJECT" SHALL MEAN IMPROVEMENTS TO AN EXISTING MAJOR
ELECTRIC GENERATING FACILITY THAT WILL ALLOW THE FACILITY, OR A NEW UNIT
OR UNITS AT THE FACILITY, OR THE COMBINATION OF THE NEW  UNIT  OR  UNITS
AND  THE  FACILITY  TO  MEET  THE  RELEVANT  ENVIRONMENTAL  REQUIREMENTS
CONTAINED IN SUBPARAGRAPHS (I), (II), (III) AND (IV) OF PARAGRAPH (B) OF
SUBDIVISION FOUR OF SECTION ONE HUNDRED SIXTY-FIVE OF THE PUBLIC SERVICE
LAW.
  (2)  "QUALIFIED  ENERGY  INFRASTRUCTURE  INVESTMENT"  SHALL  MEAN  ANY
INVESTMENT  NEEDED  TO DELIVER A NEW FUEL SOURCE TO AN EXISTING ELECTRIC
GENERATING FACILITY, REPLACE OR RETROFIT A BURNER  OR  TURBINE,  UTILIZE
ON-SITE RENEWABLE ENERGY GENERATION, OR ANY OTHER SUBSTANTIAL INVESTMENT
THAT  WILL  HAVE  A  DIRECT IMPACT ON THE FACILITY'S ABILITY TO MEET THE
ENVIRONMENTAL REQUIREMENTS CONTAINED IN SUBPARAGRAPHS (I),  (II),  (III)
AND  (IV)  OF  PARAGRAPH  (B) OF SUBDIVISION FOUR OF SECTION ONE HUNDRED
SIXTY-FIVE OF THE PUBLIC SERVICE LAW.
  (3) "QUALIFIED NEW CONSTRUCTION PROJECT" SHALL MEAN CONSTRUCTING A NEW
MAJOR ELECTRIC GENERATING FACILITY IN THE SAME LOCATION AS  AN  EXISTING
FACILITY  OR ON PROPERTY DIRECTLY ADJACENT OR CONTIGUOUS TO SAID PROPER-
TY, WHERE THE NEW FACILITY BY ITSELF OR IN COMBINATION WITH THE EXISTING
FACILITY WILL ALLOW THE SITE  AS  A  WHOLE  TO  MEET  THE  ENVIRONMENTAL
REQUIREMENTS  CONTAINED  IN  SUBPARAGRAPHS  (I), (II), (III) AND (IV) OF
PARAGRAPH (B) OF SUBDIVISION FOUR OF SECTION ONE HUNDRED  SIXTY-FIVE  OF
THE PUBLIC SERVICE LAW.
  (4)  "MAJOR  ELECTRIC GENERATING FACILITY" SHALL MEAN A MAJOR ELECTRIC
GENERATING FACILITY AS DEFINED IN  SECTION  ONE  HUNDRED  SIXTY  OF  THE
PUBLIC SERVICE LAW.
  (C) A MAJOR ELECTRIC GENERATING FACILITY WHICH UNDERTAKES A REPOWERING
PROJECT,  A  QUALIFIED ENERGY INFRASTRUCTURE INVESTMENT, A QUALIFIED NEW
CONSTRUCTION PROJECT, OR OTHER INVESTMENT IN POLLUTION CONTROL EQUIPMENT
OR ADDITIONAL ENERGY INFRASTRUCTURE WITH THE GOAL  OF  MEETING  RELEVANT
ENVIRONMENTAL REQUIREMENTS SHALL BE ALLOWED TO CLAIM A CREDIT UNDER THIS
SECTION.
  S  3.  The tax law is amended by adding a new section 187-s to read as
follows:
  S 187-S. CLEAN FUEL AND JOB CREATION  TAX  CREDIT.  (A)  ALLOWANCE  OF
CREDIT. A TAXPAYER SHALL BE ALLOWED A CREDIT, TO BE COMPUTED AS PROVIDED
IN  SECTION  THIRTY-EIGHT  OF  THIS  CHAPTER, AGAINST THE TAX IMPOSED BY
SECTIONS ONE HUNDRED EIGHTY-THREE AND ONE HUNDRED  EIGHTY-FOUR  OF  THIS
ARTICLE.

S. 2609--C                         89

  (B)  APPLICATION  OF  CREDIT.  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 EIGHT-
Y-THREE  OR  ONE  HUNDRED EIGHTY-FOUR 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.
  S 4. Section 210 of the tax law is amended by adding a new subdivision
46 to read as follows:
  46. CLEAN FUEL AND JOB CREATION TAX CREDIT. (A) ALLOWANCE OF CREDIT. A
TAXPAYER  SHALL  BE  ALLOWED  A  CREDIT,  TO  BE COMPUTED AS PROVIDED IN
SECTION THIRTY-EIGHT OF THIS CHAPTER, AGAINST THE TAX  IMPOSED  BY  THIS
ARTICLE.
  (B)  APPLICATION  OF CREDIT. THE CREDIT ALLOWED UNDER THIS SUBDIVISION
FOR ANY TAXABLE YEAR MAY NOT REDUCE THE TAX DUE FOR SUCH  YEAR  TO  LESS
THAN  THE  AMOUNT PRESCRIBED IN PARAGRAPH (D) OF SUBDIVISION ONE OF THIS
SECTION. HOWEVER, IF THE AMOUNT OF CREDIT ALLOWED UNDER THIS SUBDIVISION
FOR ANY TAXABLE YEAR REDUCES THE TAX TO SUCH AMOUNT, ANY AMOUNT OF CRED-
IT THUS NOT DEDUCTIBLE IN SUCH TAXABLE YEAR WILL BE TREATED AS AN  OVER-
PAYMENT  OF  TAX  TO  BE  CREDITED  OR  REFUNDED  IN ACCORDANCE WITH THE
PROVISIONS OF SECTION ONE THOUSAND EIGHTY-SIX OF THIS CHAPTER. PROVIDED,
HOWEVER, THE PROVISIONS OF SUBSECTION (C) OF SECTION ONE THOUSAND EIGHT-
Y-EIGHT OF THIS CHAPTER NOTWITHSTANDING, NO INTEREST WILL BE PAID THERE-
ON.
  S 5. Section 606 of the tax law is amended by adding a new  subsection
(vv) to read as follows:
  (VV)  CLEAN FUEL AND JOB CREATION TAX CREDIT. (1) ALLOWANCE OF CREDIT.
A TAXPAYER SHALL BE ALLOWED A CREDIT, TO  BE  COMPUTED  AS  PROVIDED  IN
SECTION  THIRTY-EIGHT  OF  THIS CHAPTER, AGAINST THE TAX IMPOSED BY THIS
ARTICLE.
  (2) APPLICATION OF CREDIT. IF THE AMOUNT OF THE CREDIT  ALLOWED  UNDER
THIS SUBSECTION FOR ANY TAXABLE YEAR EXCEEDS THE TAXPAYER'S TAX FOR SUCH
YEAR, THE EXCESS WILL 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 WILL  BE
PAID THEREON.
  S  6. 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) CLEAN FUEL AND JOB CREATION   AMOUNT OF CLEAN FUEL AND
CREDIT UNDER SUBSECTION (VV)         JOB CREATION CREDIT UNDER
                                     SUBDIVISION FORTY-SIX
                                     OF SECTION TWO HUNDRED TEN
  S  7.  This  act shall take effect on the ninetieth day after it shall
have become a law.

                                 PART WW

  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

S. 2609--C                         90

  (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
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

S. 2609--C                         91

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 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)

S. 2609--C                         92

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
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

S. 2609--C                         93

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
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

S. 2609--C                         94

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
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.

                                 PART XX

  Section 1. Subsection (f) of section 601 of the tax law, as amended by
chapter 248 of the laws of 1997, is amended to read as follows:
  (f) Partners and partnerships. (1) A partnership as such shall not  be
subject to tax under this article. Persons carrying on business as part-
ners  shall  be liable for tax under this article only in their separate
or individual capacities. As used in this article,  the  term  "partner-
ship"  shall  include, unless a different meaning is clearly required, a
subchapter K limited liability company. The term "subchapter  K  limited
liability  company" shall mean a limited liability company classified as
a partnership for federal income tax purposes. The term "limited liabil-
ity company" means a domestic limited liability  company  or  a  foreign
limited  liability company, as defined in section one hundred two of the
limited liability company law, a limited  liability  investment  company
formed  pursuant  to section five hundred seven of the banking law, or a
limited liability trust company formed pursuant to section  one  hundred
two-a of the banking law.

S. 2609--C                         95

  (2)  A  FOREIGN  PARTNERSHIP SHALL NOT BE DEEMED TO HAVE NEXUS IN THIS
STATE, AND THE NON-RESIDENT PARTNERS OF SUCH FOREIGN  PARTNERSHIP  SHALL
NOT  BE DEEMED TO HAVE NEW YORK-SOURCE INCOME, BY REASON OF SUCH FOREIGN
PARTNERSHIP USING FULFILLMENT SERVICES OF A PERSON OR ENTITY AND  OWNING
PROPERTY  STORED ON THE PREMISES OF SUCH PERSON OR ENTITY IN CONJUNCTION
WITH SUCH SERVICES. THE TERM "FULFILLMENT SERVICES" SHALL  MEAN  ANY  OF
THE  FOLLOWING SERVICES PERFORMED BY AN ENTITY ON ITS PREMISES ON BEHALF
OF A PURCHASER: (I) THE ACCEPTANCE OF ORDERS ELECTRONICALLY OR BY  MAIL,
TELEPHONE,  TELEFAX  OR INTERNET; (II) RESPONSES TO CONSUMER CORRESPOND-
ENCE OR INQUIRIES ELECTRONICALLY  OR  BY  MAIL,  TELEPHONE,  TELEFAX  OR
INTERNET;  (III) BILLING AND COLLECTION ACTIVITIES; OR (IV) THE SHIPMENT
OF ORDERS FROM AN INVENTORY OF PRODUCTS OFFERED FOR SALE BY THE PURCHAS-
ER.
  S 2. This act shall take effect immediately and shall apply to taxable
years beginning on or after January 1, 2014.

                                 PART YY

  Section 1. Subdivisions 2, 3, 4, 5 and 6 of section 4 of  chapter  912
of  the  laws of 1920 relating to the regulation of boxing, sparring and
wrestling, subdivisions 2 and 6 as amended by chapter 437 of the laws of
2002 and subdivisions 3, 4 and 5 as added by chapter 603 of the laws  of
1981, are amended to read as follows:
  2. The advisory board shall have power and it shall be the duty of the
board  to  prepare and submit to the commission for approval regulations
and standards for the physical examination of  professional  boxers  AND
PROFESSIONAL  COMBATIVE  SPORTS  PARTICIPANTS including, without limita-
tion, pre-fight and/or post-fight examinations and  periodic  comprehen-
sive  examinations.  The  board  shall  continue to serve in an advisory
capacity to the commission and from time to time prepare and  submit  to
the  commission  for approval, such additional regulations and standards
of examination as in their judgment will safeguard the physical  welfare
of  professional  boxers  licensed by the commission. The advisory board
shall recommend to the commission  from  time  to  time  such  qualified
physicians,  for  the  purpose  of  conducting  physical examinations of
professional boxers AND PROFESSIONAL COMBATIVE SPORTS  PARTICIPANTS  and
other  services  as the rules of the commission shall provide; and shall
recommend to the commission a schedule of fees to be paid to  physicians
for such examinations and other services as required by this act.
  3.  The  advisory  board  shall  develop appropriate medical education
programs for all commission personnel involved in the conduct of  boxing
and  sparring  matches  or  exhibitions OR PROFESSIONAL COMBATIVE SPORTS
MATCHES OR EXHIBITIONS so that such personnel can recognize and act upon
evidence of potential or actual adverse medical indications in a partic-
ipant prior to or during the course of a match OR EXHIBITION.
  4. The advisory board shall review the credentials and performance  of
each  commission  physician  on  an annual basis as a condition of reap-
pointment of  each  such  physician,  including  each  such  physician's
comprehension of the medical literature on boxing OR PROFESSIONAL COMBA-
TIVE SPORTS referred to in subdivision five of this section.
  5.  The advisory board shall recommend to the commission a compilation
of medical publications on the medical aspects of boxing OR PROFESSIONAL
COMBATIVE SPORTS which shall be maintained by the commission and be made
available for review to all commission personnel involved in the conduct
of any boxing or sparring match or exhibition OR PROFESSIONAL  COMBATIVE
SPORTS MATCH OR EXHIBITION.

S. 2609--C                         96

  6. The advisory board shall also advise the commission on any study of
equipment, procedures or personnel which will, in their opinion, promote
the  safety  of  boxing  participants  AND PROFESSIONAL COMBATIVE SPORTS
PARTICIPANTS.
  S  2.  Section  5-a of chapter 912 of the laws of 1920 relating to the
regulation of boxing, sparring and wrestling, as added by chapter 14  of
the laws of 1997, is amended to read as follows:
  S 5-a. Combative sports. 1. DEFINITIONS. AS USED IN THIS SECTION:
  (A)  "BOARD"  MEANS  MEDICAL  ADVISORY BOARD AS ESTABLISHED IN SECTION
FOUR OF THIS ACT.
  (B) A "combative sport" shall mean any professional match  or  exhibi-
tion  other than boxing, sparring, wrestling or martial arts wherein the
contestants deliver, or are not forbidden by the applicable rules there-
of from delivering kicks, punches or blows of any kind to the body of an
opponent or opponents. For  the  purposes  of  this  section,  the  term
"martial  arts"  shall include any professional match or exhibition OF A
SINGLE DISCIPLINE sanctioned by AN ORGANIZATION APPROVED BY THE  COMMIS-
SION, INCLUDING, BUT NOT LIMITED TO, any of the following organizations:
U.S.  Judo  Association, U.S. Judo, Inc., U.S. Judo Federation, U.S. Tae
Kwon Do Union, North American Sport Karate  Association,  U.S.A.  Karate
Foundation,  U.S.  Karate,  Inc., World Karate Association, Professional
Karate Association, Karate International,  International  Kenpo  Associ-
ation,  or  World  Wide Kenpo Association. The commission [is authorized
to] SHALL promulgate regulations which  would  establish  a  process  to
allow  for  the  inclusion or removal of martial arts organizations from
the above list. Such process shall include but not be limited to consid-
eration of the following factors:    [(a)]  (1)  is  the  organization's
primary purpose to provide instruction in self defense techniques; [(b)]
(2)  does  the  organization  require  the  use  of hand, feet and groin
protection during any competition or bout; and [(c)] (3) does the organ-
ization have an established set of  rules  that  require  the  immediate
termination of any competition or bout when any participant has received
severe punishment or is in danger of suffering serious physical injury.
  (C)  "COMMISSION"  MEANS THE STATE ATHLETIC COMMISSION AS PROVIDED FOR
IN SECTION ONE OF THIS CHAPTER OR AN AGENT OF THE COMMISSION  ACTING  ON
ITS BEHALF.
  (D)  "MIXED  MARTIAL  ARTS"  MEANS  ANY  PROFESSIONAL COMBATIVE SPORTS
COMPETITION WHEREIN THE RULES OF SUCH COMPETITION SUBJECT TO THE  APPLI-
CABLE  LIMITATIONS AS SET FORTH BY THE COMMISSION AUTHORIZE PROFESSIONAL
COMBATIVE SPORTS MATCHES OR EXHIBITIONS BETWEEN VARIOUS FIGHTING  DISCI-
PLINES,  INCLUDING THE UTILIZATION OF PERMITTED MARTIAL ARTS TECHNIQUES,
INCLUDING  STRIKING,  KICKING  AND  GRAPPLING.  NO  NON-PROFESSIONAL  OR
AMATEUR  BOUT,  EXHIBITION  OR  PARTICIPANT  SHALL BE AUTHORIZED BY THIS
SECTION.
  (E) "PROFESSIONAL COMBATIVE SPORTS PARTICIPANT" OR "PARTICIPANT" SHALL
MEAN A COMBATIVE SPORTS FIGHTER WHO COMPETES FOR A MONEY PRIZE OR TEACH-
ES OR PURSUES OR ASSISTS IN THE PRACTICE OF  MIXED  MARTIAL  ARTS  AS  A
MEANS  OF  OBTAINING  A  LIVELIHOOD  OR  PECUNIARY GAIN, AND ANY CONTEST
CONFORMING TO THE RULES, REGULATIONS AND REQUIREMENTS OF THIS SECTION.
  (F) "PROFESSIONAL COMBATIVE SPORTS MATCH OR EXHIBITION" SHALL MEAN ANY
MATCH OR EXHIBITION THAT  MUST  BE  APPROVED  BY  THE  COMMISSION  WHERE
PROFESSIONAL  COMBATIVE SPORTS PARTICIPANTS RECEIVE CONSIDERATION OF ANY
VALUE OR AN ADMISSION IS CHARGED.
  1-A. COMMISSION REVIEW. THE COMMISSION SHALL REVIEW EACH MARTIAL  ARTS
SANCTIONING  ORGANIZATION,  INCLUDING THOSE LISTED IN SUBDIVISION ONE OF
THIS SECTION, AT LEAST BIENNIALLY, OR  SOONER  IF  DETERMINED  NECESSARY

S. 2609--C                         97

BASED  UPON  THE PERIODIC COMPLIANCE CHECKS OR COMPLAINTS TO THE COMMIS-
SION, TO  DETERMINE  CONTINUATION  OF  THE  COMMISSION'S  APPROVAL.  THE
COMMISSION  SHALL  CONTINUE APPROVAL OR SHALL SUSPEND OR REVOKE APPROVAL
BASED  UPON COMPLIANCE OF THE ORGANIZATION WITH THE APPROVED SANCTIONING
STANDARDS AND ITS ABILITY TO  SUPERVISE  MATCHES  IN  THE  STATE.    THE
COMMISSION  SHALL  ACT UPON ANY APPLICATION FOR INCLUSION IN THE LIST IN
PARAGRAPH (B) OF SUBDIVISION ONE OF THIS SECTION WITHIN  SIXTY  DAYS  OF
THE DATE SUCH APPLICATION IS MADE TO THE COMMISSION.
  1-B.  MIXED  MARTIAL ARTS COMPETITION. THE COMMISSION SHALL PROMULGATE
RULES AND REGULATIONS TO ALLOW FOR MIXED MARTIAL ARTS COMPETITIONS TO BE
CONDUCTED, HELD, OR GIVEN WITHIN THE STATE OF NEW YORK AND  SHALL  ALLOW
FOR  LICENSES TO BE APPROVED BY THE COMMISSION FOR SUCH MATCHES OR EXHI-
BITIONS. THE COMMISSION IS AUTHORIZED  TO  PROMULGATE  RULES  AND  REGU-
LATIONS  TO CARRY OUT THE PROVISIONS OF THIS SUBDIVISION. SUCH RULES AND
REGULATIONS SHALL INCLUDE, BUT  NOT  BE  LIMITED  TO,  THE  ADOPTION  OF
UNIFIED RULES OF MIXED MARTIAL ARTS, A LICENSING PROCESS FOR MATCHES AND
EXHIBITIONS,  A  FEE SCHEDULE FOR SUCH LICENSES, PROCEDURES TO ALLOW FOR
THE PARTICIPATION, PROMOTION, AND ADVANCEMENT OF SUCH EVENTS, THE HEALTH
AND SAFETY OF PARTICIPANTS, AND THE BEST INTERESTS OF MIXED MARTIAL ARTS
AND THE ADOPTION OF RULES AND REGULATIONS FOR LICENSING  AND  REGULATION
OF  ANY AND ALL GYMS, CLUBS, TRAINING CAMPS AND OTHER ORGANIZATIONS THAT
MAINTAIN TRAINING FACILITIES PROVIDING CONTACT SPARRING FOR PERSONS  WHO
PREPARE FOR PARTICIPATION IN SUCH PROFESSIONAL COMBATIVE SPORTS OR EXHI-
BITIONS, EXCEPT AS OTHERWISE PROVIDED IN THIS SECTION.
  (B)  THE  COMMISSION  IS  AUTHORIZED  AND DIRECTED TO REQUIRE THAT ALL
SITES WHEREIN PROFESSIONAL COMBATIVE SPORTS ARE CONDUCTED  SHALL  COMPLY
WITH  STATE  AND  APPLICABLE  LOCAL SANITARY CODES APPROPRIATE TO SCHOOL
ATHLETIC FACILITIES.
  2. [No combative sport shall be conducted, held or  given  within  the
state of New York, and no licenses may be approved by the commission for
such matches or exhibitions.
  3.  (a)  A  person  who knowingly advances or profits from a combative
sport activity shall be guilty of a class A misdemeanor,  and  shall  be
guilty of a class E felony if he or she has been convicted in the previ-
ous five years of violating this subdivision.
  (b)  A  person  advances a combative sport activity when, acting other
than as a spectator, he or she engages in conduct which materially  aids
any combative sport. Such conduct includes but is not limited to conduct
directed  toward  the creation, establishment or performance of a comba-
tive sport, toward the acquisition or maintenance of premises, parapher-
nalia, equipment or  apparatus  therefor,  toward  the  solicitation  or
inducement of persons to attend or participate therein, toward the actu-
al  conduct of the performance thereof, toward the arrangement of any of
its financial or promotional phases, or toward  any  other  phase  of  a
combative  sport.  One  advances a combative sport activity when, having
substantial proprietary or other  authoritative  control  over  premises
being  used  with his or her knowledge for purposes of a combative sport
activity, he or she permits such to occur or continue or makes no effort
to prevent its occurrence or continuation.
  (c) A person profits from a combative sport activity when  he  or  she
accepts  or  receives money or other property with intent to participate
in the proceeds of a combative sport activity, or pursuant to an  agree-
ment  or understanding with any person whereby he or she participates or
is to participate in the proceeds of a combative sport activity.
  (d) Any person who knowingly advances  or  profits  from  a  combative
sport  activity  shall  also be subject to a civil penalty not to exceed

S. 2609--C                         98

for the first violation ten thousand dollars or twice the amount of gain
derived therefrom whichever is greater, or for  a  subsequent  violation
twenty  thousand  dollars  or twice the amount of gain derived therefrom
whichever  is  greater.  The  attorney  general  is  hereby empowered to
commence judicial proceedings to recover such penalties  and  to  obtain
injunctive  relief  to  enforce the provisions of this section.] PROFES-
SIONAL COMBATIVE SPORTS MATCHES AND EXHIBITIONS AUTHORIZED. NO COMBATIVE
SPORTS MATCH OR EXHIBITION SHALL BE CONDUCTED, HELD OR GIVEN WITHIN  THE
STATE  EXCEPT  IN ACCORDANCE WITH THE PROVISIONS OF THIS SECTION AND THE
RULES AND REGULATIONS PROMULGATED BY THE  COMMISSION  PURSUANT  THERETO.
THE COMMISSION SHALL DIRECT A REPRESENTATIVE TO BE PRESENT AT EACH PLACE
WHERE COMBATIVE SPORTS ARE TO BE HELD PURSUANT TO THE PROVISIONS OF THIS
SECTION.  SUCH  REPRESENTATIVE  SHALL  ASCERTAIN  THE  EXACT  CONDITIONS
SURROUNDING SUCH MATCH OR EXHIBITION AND MAKE A WRITTEN  REPORT  OF  THE
SAME IN THE MANNER AND FORM PRESCRIBED BY THE COMMISSION. SUCH COMBATIVE
SPORTS  MATCHES OR EXHIBITIONS MAY BE HELD IN ANY BUILDING FOR WHICH THE
COMMISSION IN ITS DISCRETION MAY ISSUE A LICENSE. WHERE  SUCH  MATCH  OR
EXHIBITION IS AUTHORIZED TO BE HELD IN A STATE OR CITY OWNED ARMORY, THE
PROVISION  OF THE MILITARY LAW IN RESPECT THERETO MUST BE COMPLIED WITH,
BUT NO SUCH MATCH OR EXHIBITION SHALL BE HELD IN A BUILDING WHOLLY  USED
FOR RELIGIOUS SERVICES.
  3. JURISDICTION OF COMMISSION. (A) THE COMMISSION SHALL HAVE AND HERE-
BY  IS VESTED WITH THE SOLE DIRECTION, MANAGEMENT, CONTROL AND JURISDIC-
TION OVER ALL PROFESSIONAL COMBATIVE SPORTS MATCHES OR EXHIBITIONS TO BE
CONDUCTED, HELD OR GIVEN WITHIN THE STATE  OF  NEW  YORK  AND  OVER  ALL
LICENSES TO ANY AND ALL PERSONS WHO PARTICIPATE IN SUCH COMBATIVE SPORTS
MATCHES  OR EXHIBITIONS AND OVER ANY AND ALL GYMS, CLUBS, TRAINING CAMPS
AND OTHER ORGANIZATIONS  THAT  MAINTAIN  TRAINING  FACILITIES  PROVIDING
CONTACT  SPARRING  FOR  PERSONS  WHO  PREPARE  FOR PARTICIPATION IN SUCH
PROFESSIONAL  COMBATIVE  SPORTS  OR  EXHIBITIONS,  EXCEPT  AS  OTHERWISE
PROVIDED IN THIS SECTION.
  (B)  THE  COMMISSION  IS  AUTHORIZED  AND DIRECTED TO REQUIRE THAT ALL
SITES WHEREIN PROFESSIONAL COMBATIVE SPORTS ARE CONDUCTED  SHALL  COMPLY
WITH  STATE  AND  APPLICABLE  LOCAL SANITARY CODES APPROPRIATE TO SCHOOL
ATHLETIC FACILITIES.
  4. ENTITIES  REQUIRED  TO  PROCURE  LICENSES;  PROFESSIONAL  COMBATIVE
SPORTS PARTICIPANTS DEFINED. EXCEPT AS OTHERWISE PROVIDED IN SUBDIVISION
SIX OF THIS SECTION, ALL CORPORATIONS, PERSONS, LIMITED LIABILITY COMPA-
NIES,  REFEREES,  JUDGES, CORPORATION TREASURERS, PROFESSIONAL COMBATIVE
SPORTS PARTICIPANTS,  THEIR  MANAGERS,  PROMOTERS,  TRAINERS  AND  CHIEF
SECONDS SHALL BE LICENSED BY THE COMMISSION, AND NO SUCH ENTITY SHALL BE
PERMITTED  TO PARTICIPATE, EITHER DIRECTLY OR INDIRECTLY, IN ANY PROFES-
SIONAL COMBATIVE SPORTS MATCH OR EXHIBITION,  OR  THE  HOLDING  THEREOF,
UNLESS  SUCH ENTITY SHALL HAVE FIRST PROCURED A LICENSE FROM THE COMMIS-
SION. THE COMMISSION SHALL ESTABLISH BY RULE  AND  REGULATION  LICENSING
STANDARDS  FOR REFEREES, JUDGES, MANAGERS, PROMOTERS, TRAINERS AND CHIEF
SECONDS.  ANY MATCH OR EXHIBITION CONFORMING TO THE  RULES,  REGULATIONS
AND  REQUIREMENTS  OF  THIS SECTION SHALL BE DEEMED TO BE A PROFESSIONAL
COMBATIVE SPORTS MATCH OR EXHIBITION.
  5. LICENSE TO ENTITIES. (A) THE COMMISSION  MAY,  IN  ITS  DISCRETION,
ISSUE A LICENSE TO CONDUCT OR HOLD PROFESSIONAL COMBATIVE SPORTS MATCHES
OR  EXHIBITIONS, SUBJECT TO THE PROVISIONS HEREOF, TO ANY PERSON, CORPO-
RATION OR LIMITED LIABILITY COMPANY DULY INCORPORATED OR FORMED, HEREIN-
AFTER REFERRED TO AS "ENTITY".

S. 2609--C                         99

  (B) A PROSPECTIVE LICENSEE MUST SUBMIT TO THE COMMISSION PROOF THAT IT
CAN FURNISH SUITABLE PREMISES IN WHICH SUCH MATCH OR EXHIBITION IS TO BE
HELD.
  (C)  UPON WRITTEN APPLICATION AND THE PAYMENT OF A FEE OF FIVE HUNDRED
DOLLARS WHICH MUST ACCOMPANY THE APPLICATION, THE COMMISSION  MAY  GRANT
TO ANY ENTITY HOLDING A LICENSE ISSUED HEREUNDER, THE PRIVILEGE OF HOLD-
ING SUCH A MATCH OR EXHIBITION ON A SPECIFIED DATE IN OTHER PREMISES, OR
IN  ANOTHER  LOCATION, THAN THE PREMISES OF LOCATION PREVIOUSLY APPROVED
BY THE COMMISSION, SUBJECT HOWEVER TO APPROVAL OF THE COMMISSION AND THE
RULES AND REGULATIONS OF THE COMMISSION.
  (D) ALL PENALTIES IMPOSED AND COLLECTED BY  THE  COMMISSION  FROM  ANY
ENTITY LICENSED UNDER THE PROVISIONS OF THIS ACT, WHICH FINES AND PENAL-
TIES  ARE  IMPOSED AND COLLECTED UNDER THE AUTHORITY HEREBY VESTED SHALL
WITHIN THIRTY DAYS AFTER THE RECEIPT THEREOF BY THE COMMISSION  BE  PAID
BY THEM INTO THE STATE TREASURY.
  6. TEMPORARY WORKING PERMITS FOR PROFESSIONAL COMBATIVE SPORTS PARTIC-
IPANTS,  MANAGERS,  TRAINERS AND CHIEF SECONDS. THE COMMISSION MAY ISSUE
TEMPORARY WORKING PERMITS TO PROFESSIONAL COMBATIVE SPORTS PARTICIPANTS,
THEIR MANAGERS, TRAINERS AND CHIEF SECONDS. A TEMPORARY  WORKING  PERMIT
SHALL AUTHORIZE THE EMPLOYMENT OF THE HOLDER OF SUCH PERMIT TO ENGAGE IN
A  SINGLE MATCH OR EXHIBITION AT A SPECIFIED TIME AND PLACE. A TEMPORARY
WORKING PERMIT MAY BE ISSUED IF IN THE JUDGMENT OF  THE  COMMISSION  THE
PARTICIPATION  OF  THE HOLDER THEREOF IN A PROFESSIONAL COMBATIVE SPORTS
MATCH OR EXHIBITION WILL BE CONSISTENT WITH THE PURPOSES AND  PROVISIONS
OF  THIS  SECTION, THE BEST INTERESTS OF COMBATIVE SPORTS GENERALLY, AND
THE PUBLIC  INTEREST,  CONVENIENCE  OR  NECESSITY.  THE  COMMISSION  MAY
REQUIRE  THAT  PROFESSIONAL  COMBATIVE  SPORTS PARTICIPANTS APPLYING FOR
TEMPORARY WORKING PERMITS UNDERGO A PHYSICAL  EXAMINATION,  NEUROLOGICAL
OR  NEUROPSYCHOLOGICAL  TEST OR PROCEDURE, INCLUDING COMPUTED TOMOGRAPHY
OR MEDICALLY EQUIVALENT PROCEDURE. THE FEE FOR  SUCH  TEMPORARY  WORKING
PERMIT SHALL BE TWENTY DOLLARS.
  7.  LICENSE  FEES;  TERM  OF  LICENSES; RENEWALS. EACH APPLICANT FOR A
PROMOTER LICENSE SHALL, BEFORE A LICENSE IS ISSUED  BY  THE  COMMISSION,
PAY  TO  THE  COMMISSION,  AN  ANNUAL LICENSE FEE AS FOLLOWS:  WHERE THE
SEATING CAPACITY IS NOT  MORE  THAN  TWO  THOUSAND  FIVE  HUNDRED,  FIVE
HUNDRED  DOLLARS;  WHERE  THE SEATING CAPACITY IS MORE THAN TWO THOUSAND
FIVE HUNDRED BUT NOT MORE THAN  FIVE  THOUSAND,  ONE  THOUSAND  DOLLARS;
WHERE  THE SEATING CAPACITY IS MORE THAN FIVE THOUSAND BUT NOT MORE THAN
FIFTEEN THOUSAND, ONE THOUSAND FIVE HUNDRED DOLLARS; WHERE  THE  SEATING
CAPACITY  IS  MORE  THAN  FIFTEEN THOUSAND BUT NOT MORE THAN TWENTY-FIVE
THOUSAND, TWO THOUSAND FIVE HUNDRED DOLLARS; WHERE THE SEATING  CAPACITY
IS  MORE THAN TWENTY-FIVE THOUSAND, THREE THOUSAND FIVE HUNDRED DOLLARS;
REFEREE, ONE HUNDRED DOLLARS; JUDGES, ONE HUNDRED DOLLARS;  PROFESSIONAL
COMBATIVE  SPORTS  PARTICIPANTS, FIFTY DOLLARS; MANAGERS, FIFTY DOLLARS;
TRAINERS, FIFTY DOLLARS; AND CHIEF SECONDS, FORTY DOLLARS. EACH  LICENSE
OR RENEWAL THEREOF ISSUED PURSUANT TO THIS SUBDIVISION ON OR AFTER OCTO-
BER  FIRST SHALL BE EFFECTIVE FOR A LICENSE YEAR EXPIRING ON THE THIRTI-
ETH DAY OF SEPTEMBER FOLLOWING THE DATE  OF  ITS  ISSUANCE.  THE  ANNUAL
LICENSE  FEE PRESCRIBED BY THIS SUBDIVISION SHALL BE THE LICENSE FEE DUE
AND PAYABLE THEREFOR AND SHALL BE PAID IN ADVANCE AT THE  TIME  APPLICA-
TION  IS MADE THEREFOR, AND EACH SUCH LICENSE MAY BE RENEWED FOR PERIODS
OF ONE YEAR UPON THE PAYMENT OF THE ANNUAL  LICENSE  FEE  PRESCRIBED  BY
THIS  SUBDIVISION.  WITHIN THREE YEARS FROM THE DATE OF PAYMENT AND UPON
THE AUDIT OF THE COMPTROLLER, THE COMMISSION MAY REFUND ANY FEE,  UNFOR-
FEITED  POSTED GUARANTEE OR TAX PAID PURSUANT TO THIS SECTION, FOR WHICH

S. 2609--C                         100

NO LICENSE IS ISSUED OR NO SERVICE RENDERED OR REFUND  THAT  PORTION  OF
THE PAYMENT THAT IS IN EXCESS OF THE AMOUNT PRESCRIBED BY STATUTE.
  8.  APPLICATION FOR LICENSE; FINGERPRINTS. (A) EVERY APPLICATION FOR A
LICENSE SHALL BE IN WRITING, SHALL BE ADDRESSED TO THE COMMISSION, SHALL
BE SUBSCRIBED BY THE APPLICANT, AND AFFIRMED BY HIM AS  TRUE  UNDER  THE
PENALTIES  OF  PERJURY, AND SHALL SET FORTH SUCH FACTS AS THE PROVISIONS
HEREOF AND THE RULES AND REGULATIONS OF THE COMMISSION MAY REQUIRE.
  (B) WHEN AN APPLICATION IS MADE FOR A LICENSE UNDER THIS SECTION,  THE
COMMISSION  MAY  CAUSE  THE  FINGERPRINTS  OF SUCH APPLICANT, OR IF SUCH
APPLICANT BE A CORPORATION, OF THE OFFICERS OF SUCH CORPORATION,  OR  IF
SUCH  APPLICANT  BE  A  LIMITED  LIABILITY  COMPANY, THE MANAGER OF SUCH
LIMITED LIABILITY COMPANY TO BE TAKEN IN DUPLICATE. THE APPLICANT  SHALL
BE  RESPONSIBLE  FOR THE COST OF HAVING HIS FINGERPRINTS TAKEN.  IF SUCH
FINGERPRINTS ARE TAKEN, ONE COPY SHALL BE TRANSMITTED TO THE DIVISION OF
CRIMINAL JUSTICE SERVICES IN ACCORDANCE WITH THE RULES  AND  REGULATIONS
OF  THE  DIVISION  OF  CRIMINAL JUSTICE SERVICES AND ONE SHALL REMAIN ON
FILE IN THE OFFICE  OF  THE  COMMISSION.  NO  SUCH  FINGERPRINT  MAY  BE
INSPECTED  BY ANY PERSON, OTHER THAN A PEACE OFFICER, EXCEPT ON ORDER OF
A JUDGE OR JUSTICE OF A COURT OF RECORD.  THE DIVISION IS HEREBY AUTHOR-
IZED TO TRANSMIT CRIMINAL HISTORY INFORMATION TO THE COMMISSION FOR  THE
PURPOSES  OF THIS PARAGRAPH.  THE INFORMATION OBTAINED BY ANY SUCH FING-
ERPRINT EXAMINATION SHALL BE FOR THE GUIDANCE OF THE COMMISSION  IN  THE
EXERCISE  OF ITS DISCRETION IN GRANTING OR WITHHOLDING THE LICENSE.  THE
COMMISSION SHALL PROVIDE SUCH APPLICANT WITH A COPY OF HIS OR HER CRIMI-
NAL  HISTORY  RECORD,  IF  ANY,  TOGETHER  WITH  A   COPY   OF   ARTICLE
TWENTY-THREE-A  OF  THE CORRECTION LAW, AND INFORM SUCH APPLICANT OF HIS
OR HER RIGHT TO SEEK CORRECTION OF ANY INCORRECT  INFORMATION  CONTAINED
IN SUCH RECORD PURSUANT TO REGULATIONS AND PROCEDURES ESTABLISHED BY THE
DIVISION  OF  CRIMINAL  JUSTICE  SERVICES.  ALL DETERMINATIONS TO ISSUE,
RENEW, SUSPEND OR REVOKE A LICENSE SHALL  BE  MADE  IN  ACCORDANCE  WITH
SUBDIVISION  SIXTEEN  OF SECTION TWO HUNDRED NINETY-SIX OF THE EXECUTIVE
LAW AND ARTICLE TWENTY-THREE-A OF THE CORRECTION LAW.
  9. STANDARDS FOR THE ISSUANCE OF LICENSES. (A) IF IN THE  JUDGMENT  OF
THE  COMMISSION  THE FINANCIAL RESPONSIBILITY, EXPERIENCE, CHARACTER AND
GENERAL FITNESS OF AN APPLICANT, INCLUDING IN THE CASE  OF  CORPORATIONS
ITS  OFFICERS  AND STOCKHOLDERS, ARE SUCH THAT THE PARTICIPATION OF SUCH
APPLICANT WILL BE  CONSISTENT  WITH  THE  BEST  INTERESTS  OF  COMBATIVE
SPORTS,  THE  PURPOSES  OF  THIS SECTION INCLUDING THE SAFETY OF PROFES-
SIONAL COMBATIVE  SPORTS  PARTICIPANTS,  AND  IN  THE  PUBLIC  INTEREST,
CONVENIENCE  OR  NECESSITY,  THE  COMMISSION  SHALL  GRANT  A LICENSE IN
ACCORDANCE WITH THE PROVISIONS CONTAINED IN THIS SUBDIVISION.
  (B) ANY PROFESSIONAL  COMBATIVE  SPORTS  PARTICIPANT  APPLYING  FOR  A
LICENSE  OR  RENEWAL OF A LICENSE UNDER THIS SUBDIVISION SHALL UNDERGO A
COMPREHENSIVE PHYSICAL EXAMINATION INCLUDING CLINICAL  NEUROLOGICAL  AND
NEUROPSYCHOLOGICAL  EXAMINATIONS  BY A PHYSICIAN APPROVED BY THE COMMIS-
SION. IF, AT THE TIME OF SUCH EXAMINATION, THERE IS  ANY  INDICATION  OF
BRAIN  INJURY,  OR FOR ANY OTHER REASON THE PHYSICIAN DEEMS IT APPROPRI-
ATE, THE PROFESSIONAL COMBATIVE SPORTS PARTICIPANT SHALL BE REQUIRED  TO
UNDERGO  FURTHER  NEUROLOGICAL  AND NEUROPSYCHOLOGICAL EXAMINATIONS BY A
NEUROLOGIST INCLUDING, BUT NOT LIMITED  TO,  A  COMPUTED  TOMOGRAPHY  OR
MEDICALLY EQUIVALENT PROCEDURE. THE COMMISSION SHALL NOT ISSUE A LICENSE
TO  A  PROFESSIONAL COMBATIVE SPORTS PARTICIPANT UNTIL SUCH EXAMINATIONS
ARE COMPLETED AND REVIEWED BY THE COMMISSION. THE RESULTS  OF  ALL  SUCH
EXAMINATIONS  HEREIN  REQUIRED  SHALL  BECOME A PART OF THE PROFESSIONAL
COMBATIVE SPORTS PARTICIPANT'S PERMANENT MEDICAL RECORD AS MAINTAINED BY
THE COMMISSION. THE COST OF ALL SUCH EXAMINATIONS  CALLED  FOR  IN  THIS

S. 2609--C                         101

SUBDIVISION  SHALL  BE  ASSUMED  BY  THE  STATE IF SUCH EXAMINATIONS ARE
PERFORMED BY A PHYSICIAN OR NEUROLOGIST APPROVED BY THE COMMISSION.
  (C)  ANY PROFESSIONAL COMBATIVE SPORTS PARTICIPANT LICENSED UNDER THIS
CHAPTER SHALL, AS A CONDITION OF LICENSURE, WAIVE RIGHT OF CONFIDENTIAL-
ITY OF MEDICAL RECORDS RELATING TO TREATMENT OF ANY  PHYSICAL  CONDITION
WHICH RELATES TO HIS ABILITY TO FIGHT. ALL MEDICAL REPORTS SUBMITTED TO,
AND  ALL MEDICAL RECORDS OF THE MEDICAL ADVISORY BOARD OR THE COMMISSION
RELATIVE TO THE PHYSICAL EXAMINATION OR CONDITION  OF  COMBATIVE  SPORTS
PARTICIPANTS  SHALL  BE  CONSIDERED  CONFIDENTIAL,  AND SHALL BE OPEN TO
EXAMINATION ONLY TO THE COMMISSION OR ITS AUTHORIZED REPRESENTATIVE,  TO
THE  LICENSED PARTICIPANT, MANAGER OR CHIEF SECOND UPON WRITTEN APPLICA-
TION TO EXAMINE SAID RECORDS, OR UPON THE ORDER OF A COURT OF  COMPETENT
JURISDICTION IN AN APPROPRIATE CASE.
  10.  FINANCIAL  INTEREST IN PROFESSIONAL COMBATIVE SPORTS PARTICIPANTS
PROHIBITED. NO ENTITY SHALL HAVE, EITHER  DIRECTLY  OR  INDIRECTLY,  ANY
FINANCIAL  INTEREST  IN  A  PROFESSIONAL  COMBATIVE  SPORTS  PARTICIPANT
COMPETING ON PREMISES OWNED OR LEASED BY THE ENTITY, OR  IN  WHICH  SUCH
ENTITY  IS  OTHERWISE INTERESTED EXCEPT PURSUANT TO THE SPECIFIC WRITTEN
AUTHORIZATION OF THE COMMISSION.
  11. PAYMENTS NOT TO BE MADE BEFORE CONTESTS. NO PROFESSIONAL COMBATIVE
SPORTS PARTICIPANT SHALL BE PAID FOR SERVICES BEFORE  THE  CONTEST,  AND
SHOULD  IT BE DETERMINED BY THE COMMISSION THAT SUCH PARTICIPANT DID NOT
GIVE AN HONEST EXHIBITION OF HIS SKILL, SUCH SERVICE SHALL NOT  BE  PAID
FOR.
  12.  SHAM  OR  COLLUSIVE  EVENTS. (A) ANY PERSON, INCLUDING ANY CORPO-
RATION AND THE OFFICERS THEREOF, ANY PHYSICIAN, LIMITED LIABILITY COMPA-
NY, REFEREE, JUDGE, PROFESSIONAL COMBATIVE SPORTS PARTICIPANT,  MANAGER,
TRAINER OR CHIEF SECOND, WHO SHALL PROMOTE, CONDUCT, GIVE OR PARTICIPATE
IN  ANY SHAM OR COLLUSIVE PROFESSIONAL COMBATIVE SPORTS MATCH OR EXHIBI-
TION, SHALL BE DEPRIVED OF HIS LICENSE BY THE COMMISSION.
  (B) NO LICENSED ENTITY SHALL KNOWINGLY ENGAGE IN A COURSE  OF  CONDUCT
IN  WHICH  PROFESSIONAL  COMBATIVE  SPORTS  MATCHES  OR  EXHIBITIONS ARE
ARRANGED WHERE ONE PROFESSIONAL COMBATIVE SPORTS PARTICIPANT HAS  SKILLS
OR  EXPERIENCE  SIGNIFICANTLY IN EXCESS OF THE OTHER PROFESSIONAL COMBA-
TIVE SPORTS PARTICIPANT SO THAT A MISMATCH RESULTS WITH THE POTENTIAL OF
PHYSICAL HARM TO THE PROFESSIONAL COMBATIVE SPORTS PARTICIPANT. IF  SUCH
ACTION  OCCURS,  THE  COMMISSION  MAY  EXERCISE ITS POWERS TO DISCIPLINE
UNDER SUBDIVISIONS THIRTEEN AND FOURTEEN OF THIS SECTION, PROVIDED  THAT
NOTHING  IN THIS SUBDIVISION SHALL AUTHORIZE THE COMMISSION TO INTERVENE
OR PROHIBIT A PROFESSIONAL COMBATIVE SPORTS MATCH OR  EXHIBITION  SOLELY
ON  THE BASIS OF THE DIFFERENCE BETWEEN RESPECTIVE PARTICIPANT'S MARTIAL
ARTS DISCIPLINES.
  13. IMPOSITION OF PENALTIES FOR VIOLATIONS. ANY ENTITY, LICENSED UNDER
THE PROVISIONS OF THIS SECTION, THAT SHALL KNOWINGLY VIOLATE ANY RULE OR
ORDER OF THE COMMISSION OR ANY PROVISION OF THIS SECTION, IN ADDITION TO
ANY OTHER PENALTY BY LAW PRESCRIBED, SHALL BE LIABLE TO A CIVIL  PENALTY
NOT  EXCEEDING FIVE THOUSAND DOLLARS TO BE IMPOSED BY THE COMMISSION, TO
BE SUED FOR BY THE ATTORNEY GENERAL IN THE NAME OF  THE  PEOPLE  OF  THE
STATE  OF  NEW  YORK  IF  DIRECTED  BY THE COMMISSION. THE AMOUNT OF THE
PENALTY COLLECTED BY THE COMMISSION OR RECOVERED IN ANY SUCH ACTION,  OR
PAID  TO THE COMMISSION UPON A COMPROMISE AS HEREINAFTER PROVIDED, SHALL
BE TRANSMITTED BY THE DEPARTMENT OF STATE INTO THE  STATE  TREASURY  AND
CREDITED  TO  THE  GENERAL  FUND.  THE  COMMISSION, FOR CAUSE SHOWN, MAY
EXTEND THE TIME FOR THE PAYMENT OF SUCH PENALTY AND, BY COMPROMISE,  MAY
ACCEPT  LESS  THAN  THE  AMOUNT OF SUCH PENALTY AS IMPOSED IN SETTLEMENT
THEREOF.

S. 2609--C                         102

  14. REVOCATION OR SUSPENSION OF LICENSES. (A) ANY LICENSE ISSUED UNDER
THE PROVISIONS OF THIS SECTION  MAY  BE  REVOKED  OR  SUSPENDED  BY  THE
COMMISSION  FOR THE REASON THEREIN STATED, THAT THE LICENSEE HAS, IN THE
JUDGMENT OF THE COMMISSION, BEEN GUILTY OF AN  ACT  DETRIMENTAL  TO  THE
INTERESTS  OF  COMBATIVE  SPORTS  GENERALLY  OR  TO THE PUBLIC INTEREST,
CONVENIENCE OR NECESSITY.
  (B) WITHOUT OTHERWISE LIMITING THE DISCRETION  OF  THE  COMMISSION  AS
PROVIDED IN THIS SECTION, THE COMMISSION MAY SUSPEND OR REVOKE A LICENSE
OR  REFUSE TO RENEW OR ISSUE A LICENSE, IF IT SHALL FIND THAT THE APPLI-
CANT OR PARTICIPANT: (1) HAS BEEN CONVICTED OF A CRIME IN ANY  JURISDIC-
TION;  (2)  IS  ASSOCIATING  OR  CONSORTING  WITH  ANY PERSON WHO HAS OR
PERSONS WHO HAVE BEEN CONVICTED OF A CRIME OR CRIMES IN ANY JURISDICTION
OR JURISDICTIONS; (3) HAS BEEN GUILTY  OF  OR  ATTEMPTED  ANY  FRAUD  OR
MISREPRESENTATION  IN CONNECTION WITH COMBATIVE SPORTS; (4) HAS VIOLATED
OR ATTEMPTED TO VIOLATE ANY LAW WITH RESPECT TO COMBATIVE SPORTS IN  ANY
JURISDICTION  OR  ANY  RULE,  REGULATION  OR ORDER OF THE COMMISSION, OR
SHALL HAVE VIOLATED ANY RULE OF COMBATIVE SPORTS WHICH SHALL  HAVE  BEEN
APPROVED  OR ADOPTED BY THE COMMISSION, OR HAS BEEN GUILTY OF OR ENGAGED
IN SIMILAR, RELATED OR LIKE PRACTICES; OR (5) HAS NOT ACTED IN THE  BEST
INTEREST  OF  MIXED  MARTIAL ARTS.   ALL DETERMINATIONS TO ISSUE, RENEW,
SUSPEND OR REVOKE A LICENSE SHALL BE MADE IN ACCORDANCE WITH SUBDIVISION
SIXTEEN OF SECTION TWO HUNDRED NINETY-SIX OF THE EXECUTIVE LAW AND ARTI-
CLE TWENTY-THREE-A OF THE CORRECTION LAW AS APPLICABLE.
  (C) NO SUCH PARTICIPANT MAY, UNDER  ANY    CIRCUMSTANCES,  COMPETE  OR
APPEAR  IN  A  PROFESSIONAL  COMBATIVE SPORTS MATCH OR EXHIBITION WITHIN
NINETY DAYS OF HAVING SUFFERED A KNOCKOUT OR TECHNICAL KNOCKOUT  IN  ANY
SUCH MATCH OR EXHIBITION WITHOUT CLEARANCE BY THE BOARD, OR WITHIN NINE-
TY  DAYS  OF  BEING RENDERED UNCONSCIOUS IN ANY SUCH MATCH OR EXHIBITION
WHERE THERE IS EVIDENCE OF HEAD TRAUMA AS DETERMINED  BY  THE  ATTENDING
COMMISSION  PHYSICIAN  AND  SHALL  UNDERGO SUCH EXAMINATIONS AS REQUIRED
UNDER PARAGRAPH (B) OF SUBDIVISION TWENTY OF THIS SECTION.  THE  PROFES-
SIONAL  COMBATIVE  SPORTS PARTICIPANT SHALL BE CONSIDERED SUSPENDED FROM
PROFESSIONAL COMBATIVE SPORTS MATCHES OR EXHIBITIONS BY  THE  COMMISSION
AND  SHALL  FORFEIT HIS LICENSE TO THE COMMISSION DURING SUCH PERIOD AND
SUCH LICENSE SHALL NOT BE RETURNED TO THE PARTICIPANT UNTIL THE  PARTIC-
IPANT HAS MET ALL REQUIREMENTS, MEDICAL AND OTHERWISE, FOR REINSTATEMENT
OF  SUCH  LICENSE. ALL SUCH SUSPENSIONS SHALL BE RECORDED IN THE PARTIC-
IPANT'S LICENSE BY A COMMISSION OFFICIAL.
  (D) THE COMMISSION MAY AT ANY TIME SUSPEND, REVOKE OR DENY  A  PARTIC-
IPANT'S  LICENSE  OR TEMPORARY WORKING PERMIT FOR MEDICAL REASONS AT THE
RECOMMENDATION OF THE BOARD.
  (E) NOTWITHSTANDING ANY OTHER PROVISION OF LAW,  IF  ANY  OTHER  STATE
SHALL REVOKE A LICENSEE'S LICENSE TO COMPETE OR APPEAR IN A PROFESSIONAL
COMBATIVE  SPORTS  MATCH  OR EXHIBITION IN THAT STATE BASED ON A KNOWING
AND INTENTIONAL ENGAGEMENT IN ANY PROHIBITED PRACTICES  OF  SUCH  STATE,
THE  COMMISSION  MAY ACT TO REVOKE ANY LICENSE TO COMPETE OR APPEAR IN A
PROFESSIONAL COMBATIVE SPORTS MATCH OR EXHIBITION ISSUED TO SUCH  LICEN-
SEE PURSUANT TO THE PROVISIONS OF THIS SECTION.
  (F)  THE  COMMISSION  MAY SUSPEND ANY LICENSE IT HAS ISSUED BY A DATED
NOTICE TO THAT EFFECT TO THE SUSPENDED LICENSEE, MAILED OR DELIVERED  TO
THE  LICENSEE, AND SPECIFYING THE EFFECTIVE DATE AND TERM OF THE SUSPEN-
SION, PROVIDED HOWEVER THAT THE COMMISSION REPRESENTATIVE IN CHARGE OF A
CONTEST OR EXHIBITION MAY THEN AND THERE TEMPORARILY SUSPEND ANY LICENSE
ISSUED BY THE COMMISSION WITHOUT SUCH NOTICE. IN THE EVENT OF  A  TEMPO-
RARY  SUSPENSION, THE COMMISSION SHALL MAIL OR DELIVER THE NOTICE TO THE
SUSPENDED LICENSEE  WITHIN  THREE  BUSINESS  DAYS  AFTER  THE  TEMPORARY

S. 2609--C                         103

SUSPENSION.  IN  EITHER  CASE SUCH SUSPENSION MAY BE WITHOUT ANY ADVANCE
HEARING. UPON THE RECEIPT OF SUCH NOTICE OF  SUSPENSION,  THE  SUSPENDED
LICENSEE  MAY  APPLY  TO  THE  COMMISSION FOR A HEARING ON THE MATTER TO
DETERMINE  WHETHER SUCH SUSPENSION SHOULD BE RESCINDED. SUCH APPLICATION
FOR A HEARING MUST BE IN WRITING AND MUST BE RECEIVED BY THE  COMMISSION
WITHIN  THIRTY  DAYS AFTER THE DATE OF NOTICE OF SUSPENSION. THE COMMIS-
SION SHALL HAVE THE AUTHORITY TO REVOKE ANY LICENSE ISSUED BY IT. BEFORE
ANY LICENSE IS SO REVOKED, THE LICENSEE WILL BE OFFERED THE  OPPORTUNITY
AT  A  HEARING  HELD BY OR ON BEHALF OF THE COMMISSION TO SHOW CAUSE WHY
THE LICENSE SHOULD NOT BE REVOKED. THE COMMISSION SHALL OFFER THE OPPOR-
TUNITY FOR A HEARING TO AN  AFFECTED  PERSON  BEFORE  TAKING  ANY  FINAL
ACTION NEGATIVELY AFFECTING SUCH PERSON'S INDIVIDUAL PRIVILEGES OR PROP-
ERTY  GRANTED  BY  A LICENSE DULY ISSUED BY THE COMMISSION OR A CONTRACT
APPROVED BY AND FILED WITH THE COMMISSION. IN ALL SUCH HEARINGS,  LICEN-
SEES  AND OTHER WITNESSES SHALL TESTIFY UNDER OATH OR AFFIRMATION, WHICH
MAY BE ADMINISTERED BY ANY COMMISSIONER OR AUTHORIZED REPRESENTATIVE  OF
THE  COMMISSION ACTUALLY PRESENT. THE COMMISSION SHALL BE THE SOLE JUDGE
OF THE RELEVANCY AND COMPETENCY OF TESTIMONY  AND  OTHER  EVIDENCE,  THE
CREDIBILITY  OF WITNESSES, AND THE SUFFICIENCY OF EVIDENCE. HEARINGS MAY
BE CONDUCTED BY REPRESENTATIVES OF THE COMMISSION IN THE  DISCRETION  OF
THE COMMISSION. IN SUCH CASES, THE COMMISSION REPRESENTATIVES CONDUCTING
THE  HEARING  SHALL  SUBMIT  FINDINGS OF FACT AND RECOMMENDATIONS TO THE
COMMISSION, WHICH SHALL NOT BE BINDING ON THE COMMISSION.
  15. ADVERTISING MATTER TO STATE ADMISSION PRICE. IT SHALL BE THE  DUTY
OF  EVERY ENTITY PROMOTING OR CONDUCTING A PROFESSIONAL COMBATIVE SPORTS
MATCH OR EXHIBITION SUBJECT TO THE PROVISIONS OF THIS SECTION  TO  CAUSE
TO  BE INSERTED IN EACH SHOW CARD, BILL, POSTER, NEWSPAPER ADVERTISEMENT
OF ANY PROFESSIONAL COMBATIVE SPORTS MATCH OR EXHIBITION  GIVEN  BY  IT,
THE  PRICE  OF  ADMISSION  THERETO.  VIOLATION OF THE PROVISIONS OF THIS
SUBDIVISION SHALL SUBJECT THE ENTITY TO A FINE OF ONE HUNDRED DOLLARS.
  16. TICKETS TO INDICATE PURCHASE PRICE. ALL TICKETS  OF  ADMISSION  TO
ANY SUCH COMBATIVE SPORTS MATCH OR EXHIBITION SHALL BE CONTROLLED BY THE
PROVISIONS  OF ARTICLE TWENTY-FIVE OF THE ARTS AND CULTURAL AFFAIRS LAW.
IT SHALL BE UNLAWFUL FOR ANY ENTITY TO ADMIT TO SUCH MATCH OR EXHIBITION
A NUMBER OF PEOPLE GREATER THAN THE SEATING CAPACITY OF THE PLACE  WHERE
SUCH MATCH OR EXHIBITION IS HELD. VIOLATION OF THIS SUBDIVISION SHALL BE
A  MISDEMEANOR  AND  SHALL  BE  PUNISHABLE AS SUCH AND IN ADDITION SHALL
INCUR FORFEITURE OF LICENSE.
  17. EQUIPMENT OF BUILDINGS FOR MATCHES OR EXHIBITIONS.  ALL  BUILDINGS
OR  STRUCTURES  USED  OR  INTENDED TO BE USED FOR HOLDING OR GIVING SUCH
PROFESSIONAL COMBATIVE SPORTS MATCHES OR EXHIBITIONS SHALL  BE  PROPERLY
VENTILATED  AND  PROVIDED  WITH  FIRE EXITS AND FIRE ESCAPES, AND IN ALL
MANNER CONFORM TO THE LAWS, ORDINANCES  AND  REGULATIONS  PERTAINING  TO
BUILDINGS IN THE CITY, TOWN OR VILLAGE WHERE SITUATED.
  18.  AGE  OF  PARTICIPANTS AND SPECTATORS.  NO PERSON UNDER THE AGE OF
EIGHTEEN YEARS SHALL PARTICIPATE IN ANY  PROFESSIONAL  COMBATIVE  SPORTS
MATCH  OR  EXHIBITION, AND NO PERSON UNDER SIXTEEN YEARS OF AGE SHALL BE
PERMITTED TO ATTEND AS A SPECTATOR; PROVIDED,  HOWEVER,  THAT  A  PERSON
UNDER  THE AGE OF SIXTEEN SHALL BE PERMITTED TO ATTEND AS A SPECTATOR IF
ACCOMPANIED BY A PARENT OR GUARDIAN.
  19. REGULATION OF CONDUCT OF MATCHES OR EXHIBITIONS.  (A)  EXCEPT  FOR
CHAMPIONSHIP  MATCHES,  WHICH  SHALL  NOT  BE  MORE THAN FIVE ROUNDS, NO
COMBATIVE SPORTS MATCH OR EXHIBITION SHALL BE MORE THAN THREE ROUNDS  IN
LENGTH.    NO  PARTICIPANT  SHALL BE ALLOWED TO PARTICIPATE IN MORE THAN
THREE MATCHES OR EXHIBITIONS OR COMPETE  FOR  MORE  THAN  SIXTY  MINUTES
WITHIN  SEVENTY-TWO  CONSECUTIVE HOURS.  NO PARTICIPANT SHALL BE ALLOWED

S. 2609--C                         104

TO COMPETE IN ANY SUCH MATCH OR EXHIBITION WITHOUT WEARING A  MOUTHGUARD
AND A PROTECTIVE GROIN CUP.  AT EACH PROFESSIONAL COMBATIVE SPORTS MATCH
OR  EXHIBITION, THERE SHALL BE IN ATTENDANCE A DULY LICENSED REFEREE WHO
SHALL  DIRECT  AND  CONTROL  THE  SAME. BEFORE STARTING SUCH CONTEST THE
REFEREE SHALL ASCERTAIN FROM EACH PARTICIPANT THE NAME OF HIS MANAGER OR
CHIEF SECOND, AND SHALL HOLD SUCH MANAGER OR  CHIEF  SECOND  RESPONSIBLE
FOR  THE  CONDUCT  OF  HIS  ASSISTANT SECONDS DURING THE PROGRESS OF THE
MATCH OR EXHIBITION.   THE  COMMISSION  SHALL  HAVE  THE  POWER  IN  ITS
DISCRETION TO DECLARE FORFEITED ANY PRIZE, REMUNERATION OR PURSE, OR ANY
PART THEREOF, BELONGING TO THE PARTICIPANTS OR ONE OF THEM, OR THE SHARE
THEREOF  OF ANY MANAGER OR CHIEF SECOND IF IN ITS JUDGMENT, SUCH PARTIC-
IPANT OR PARTICIPANTS ARE NOT HONESTLY COMPETING OR THE  PARTICIPANT  OR
MANAGER  OR  CHIEF  SECOND  OF  A  PARTICIPANT,  AS THE CASE MAY BE, HAS
COMMITTED AN ACT IN THE PREMISES IN VIOLATION  OF  ANY  RULE,  ORDER  OR
REGULATION  OF  THE  COMMISSION.  THE  AMOUNT SO FORFEITED SHALL BE PAID
WITHIN FORTY-EIGHT HOURS TO THE  COMMISSION.  THERE  SHALL  ALSO  BE  IN
ATTENDANCE,  THREE  DULY LICENSED JUDGES WHO SHALL AT THE TERMINATION OF
EACH SUCH COMBATIVE SPORTS MATCH OR EXHIBITION  RENDER  THEIR  DECISION.
THE WINNER OF SUCH MATCH OR EXHIBITION SHALL BE DETERMINED IN ACCORDANCE
WITH  A SCORING SYSTEM PRESCRIBED BY THE COMMISSION.  PROVIDED, HOWEVER,
THAT A PARTICIPANT MAY TERMINATE THE CONTEST BY SIGNALLING TO THE REFER-
EE THAT SUCH PARTICIPANT SUBMITS TO THE OPPONENT.
  (B) THE COMMISSION MAY BY RULE, REGULATION OR ORDER, REQUIRE THE PRES-
ENCE OF ANY MEDICAL EQUIPMENT AND PERSONNEL AT EACH PROFESSIONAL  COMBA-
TIVE  SPORTS  MATCH  OR EXHIBITION AS IS NECESSARY OR BENEFICIAL FOR THE
SAFETY AND PROTECTION OF THE CONTESTANTS; AND MAY ALSO REQUIRE THE PRES-
ENCE OF AN AMBULANCE OR OTHER APPARATUS AT THE SITE OF ANY SUCH MATCH OR
EXHIBITION OR THE PROMULGATION OF AN  EMERGENCY  MEDICAL  PLAN  IN  LIEU
THEREOF.
  (C) THE COMMISSION SHALL PRESCRIBE BY RULE OR REGULATION THE RESPONSI-
BILITIES  OF  MANAGERS,  TRAINERS AND CHIEF SECONDS PRIOR TO, DURING AND
AFTER A COMBATIVE SPORTS MATCH OR EXHIBITION IN  ORDER  TO  PROMOTE  THE
SAFETY OF THE PARTICIPANTS AT ALL TIMES.
  (D)  THE  COMMISSION  SHALL  REQUIRE  BY  RULE  OR REGULATION THAT ANY
PROFESSIONAL COMBATIVE SPORTS PARTICIPANT LICENSED  UNDER  THIS  SECTION
PRESENT  TO A DESIGNATED COMMISSION OFFICIAL, BEFORE EACH MATCH OR EXHI-
BITION IN WHICH HE FIGHTS IN THIS STATE, A LICENSE WHICH  SHALL  INCLUDE
BUT  NOT  BE LIMITED TO THE FOLLOWING INFORMATION: (1) THE PARTICIPANT'S
NAME, PHOTOGRAPH, SOCIAL SECURITY NUMBER, DATE OF BIRTH, AND OTHER IDEN-
TIFYING INFORMATION; (2) THE PARTICIPANT'S  PRIOR  MATCH  OR  EXHIBITION
HISTORY  INCLUDING  THE DATES, LOCATION, AND DECISION OF SUCH MATCHES OR
EXHIBITIONS; AND (3) THE PARTICIPANT'S MEDICAL HISTORY, RELATING TO  ANY
PHYSICAL CONDITION, MEDICAL TEST OR PROCEDURE WHICH RELATES TO HIS ABIL-
ITY TO FIGHT, AND A RECORD OF ALL MEDICAL SUSPENSIONS.
  20. EXAMINATION BY PHYSICIAN; COST. (A) ALL PARTICIPANTS MUST BE EXAM-
INED  BY  A  PHYSICIAN  DESIGNATED BY THE COMMISSION BEFORE ENTERING THE
RING AND EACH SUCH PHYSICIAN SHALL IMMEDIATELY FILE WITH THE  COMMISSION
A  WRITTEN REPORT OF SUCH EXAMINATION. THE COST OF ANY SUCH EXAMINATION,
AS PRESCRIBED BY A SCHEDULE OF FEES ESTABLISHED BY THE COMMISSION, SHALL
BE PAID BY THE ENTITY CONDUCTING THE MATCH OR EXHIBITION TO THE  COMMIS-
SION,  WHICH  SHALL THEN PAY THE FEE COVERING SUCH COST TO THE EXAMINING
PHYSICIAN, IN ACCORDANCE WITH THE RULES OF THE COMMISSION.
  (B) ANY PROFESSIONAL COMBATIVE SPORTS PARTICIPANT LICENSED OR  PERMIT-
TED  UNDER THIS SECTION RENDERED UNCONSCIOUS OR SUFFERING HEAD TRAUMA AS
DETERMINED BY THE ATTENDING PHYSICIAN SHALL BE IMMEDIATELY  EXAMINED  BY
THE  ATTENDING  COMMISSION  PHYSICIAN  AND  SHALL BE REQUIRED TO UNDERGO

S. 2609--C                         105

NEUROLOGICAL  AND  NEUROPSYCHOLOGICAL  EXAMINATIONS  BY  A   NEUROLOGIST
INCLUDING  BUT  NOT LIMITED TO A COMPUTED TOMOGRAPHY OR MEDICALLY EQUIV-
ALENT PROCEDURE. ANY PARTICIPANT SO INJURED  SHALL  NOT  APPEAR  IN  ANY
MATCH  OR  EXHIBITION UNTIL RESULTS OF SUCH EXAMINATIONS ARE REVIEWED BY
THE COMMISSION. THE RESULTS OF ALL  SUCH  EXAMINATIONS  HEREIN  REQUIRED
SHALL  BECOME  A  PART OF THE PARTICIPANT'S PERMANENT MEDICAL RECORDS AS
MAINTAINED BY THE COMMISSION AND SHALL BE  USED  BY  THE  COMMISSION  TO
DETERMINE  WHETHER  A  PARTICIPANT  SHALL  BE PERMITTED TO APPEAR IN ANY
FUTURE PROFESSIONAL COMBATIVE SPORTS MATCH OR EXHIBITION.  THE COSTS  OF
ALL  SUCH  EXAMINATIONS CALLED FOR IN THIS PARAGRAPH SHALL BE ASSUMED BY
THE ENTITY OR PROMOTER IF SUCH EXAMINATIONS ARE PERFORMED BY A PHYSICIAN
APPROVED BY THE COMMISSION.
  (C) THE COMMISSION MAY AT ANY TIME REQUIRE  A  LICENSED  OR  PERMITTED
PARTICIPANT  TO UNDERGO A PHYSICAL EXAMINATION, INCLUDING ANY NEUROLOGI-
CAL OR NEUROPSYCHOLOGICAL TEST OR PROCEDURE. THE COST OF SUCH EXAM SHALL
BE ASSUMED BY THE STATE.
  21. PHYSICIAN TO BE IN ATTENDANCE; POWERS OF SUCH  PHYSICIAN.  (A)  IT
SHALL BE THE DUTY OF EVERY ENTITY LICENSED TO CONDUCT A COMBATIVE SPORTS
MATCH  OR EXHIBITION, TO HAVE IN ATTENDANCE AT EVERY MATCH OR EXHIBITION
AT LEAST ONE PHYSICIAN DESIGNATED BY THE COMMISSION AS THE  RULES  SHALL
PROVIDE.  THE  COMMISSION MAY ESTABLISH A SCHEDULE OF FEES TO BE PAID BY
THE LICENSEE TO COVER THE COST OF SUCH ATTENDANCE. SUCH  FEES  SHALL  BE
PAID TO THE COMMISSION, WHICH SHALL THEN PAY SUCH FEES TO THE PHYSICIANS
ENTITLED THERETO, IN ACCORDANCE WITH THE RULES OF THE COMMISSION.
  (B)  THE  PHYSICIAN  SHALL TERMINATE ANY PROFESSIONAL COMBATIVE SPORTS
MATCH OR EXHIBITION IF IN THE OPINION OF SUCH PHYSICIAN ANY  PARTICIPANT
HAS RECEIVED SEVERE PUNISHMENT OR IS IN DANGER OF SERIOUS PHYSICAL INJU-
RY.  IN  THE  EVENT OF ANY SERIOUS PHYSICAL INJURY, SUCH PHYSICIAN SHALL
IMMEDIATELY RENDER ANY EMERGENCY TREATMENT NECESSARY, RECOMMEND  FURTHER
TREATMENT  OR  HOSPITALIZATION  IF REQUIRED, AND FULLY REPORT THE ENTIRE
MATTER TO THE COMMISSION WITHIN  TWENTY-FOUR  HOURS  AND  IF  NECESSARY,
SUBSEQUENTLY  THEREAFTER.  SUCH  PHYSICIAN  MAY  ALSO  REQUIRE  THAT THE
INJURED PARTICIPANT AND HIS MANAGER OR CHIEF SECOND REMAIN IN  THE  RING
OR  ON  THE  PREMISES OR REPORT TO A HOSPITAL AFTER THE CONTEST FOR SUCH
PERIOD OF TIME AS SUCH PHYSICIAN DEEMS ADVISABLE.
  (C) SUCH PHYSICIAN MAY ENTER THE RING AT ANY  TIME  DURING  A  PROFES-
SIONAL  COMBATIVE SPORTS MATCH OR EXHIBITION AND MAY TERMINATE THE MATCH
OR EXHIBITION IF IN HIS OPINION THE SAME IS NECESSARY TO PREVENT  SEVERE
PUNISHMENT OR SERIOUS PHYSICAL INJURY TO A PARTICIPANT.
  22.  BOND. BEFORE A LICENSE SHALL BE GRANTED TO AN ENTITY TO CONDUCT A
PROFESSIONAL COMBATIVE SPORTS MATCH OR EXHIBITION, THE  APPLICANT  SHALL
EXECUTE  AND  FILE WITH THE COMPTROLLER A BOND IN AN AMOUNT TO BE DETER-
MINED BY THE COMMISSION, TO BE APPROVED AS TO FORM  AND  SUFFICIENCY  OF
SURETIES  THEREON  BY  THE  COMPTROLLER,  CONDITIONED  FOR  THE FAITHFUL
PERFORMANCE BY SUCH ENTITY OF THE PROVISIONS OF  THIS  SECTION  AND  THE
RULES  AND  REGULATIONS  OF  THE  COMMISSION,  AND  UPON  THE FILING AND
APPROVAL OF SUCH BOND THE COMPTROLLER SHALL ISSUE TO  SUCH  APPLICANT  A
CERTIFICATE  OF  SUCH FILING AND APPROVAL, WHICH SHALL BE BY SUCH APPLI-
CANT FILED IN THE OFFICE OF THE  COMMISSION  WITH  ITS  APPLICATION  FOR
LICENSE,  AND  NO  SUCH  LICENSE  SHALL BE ISSUED UNTIL SUCH CERTIFICATE
SHALL BE FILED. IN CASE OF DEFAULT IN SUCH PERFORMANCE,  THE  COMMISSION
MAY IMPOSE UPON THE DELINQUENT A PENALTY IN THE SUM OF NOT MORE THAN ONE
THOUSAND  DOLLARS FOR EACH OFFENSE, WHICH MAY BE RECOVERED BY THE ATTOR-
NEY GENERAL IN THE NAME OF THE PEOPLE OF THE STATE OF NEW  YORK  IN  THE
SAME  MANNER  AS  OTHER  PENALTIES  ARE  RECOVERED BY LAW; ANY AMOUNT SO
RECOVERED SHALL BE PAID INTO THE TREASURY.

S. 2609--C                         106

  23. BOND FOR PURSES, SALARIES AND OTHER EXPENSES. IN ADDITION  TO  THE
BOND  REQUIRED BY SUBDIVISION TWENTY-TWO OF THIS SECTION, EACH APPLICANT
FOR A LICENSE TO CONDUCT PROFESSIONAL COMBATIVE SPORTS MATCHES OR  EXHI-
BITIONS  SHALL EXECUTE AND FILE WITH THE COMPTROLLER A BOND IN AN AMOUNT
TO  BE DETERMINED BY THE COMMISSION TO BE APPROVED AS TO FORM AND SUFFI-
CIENCY OF SURETIES THEREON BY THE COMPTROLLER, CONDITIONED FOR AND GUAR-
ANTEEING THE PAYMENT  OF  PROFESSIONAL  COMBATIVE  SPORTS  PARTICIPANTS'
PURSES,  SALARIES  OF CLUB EMPLOYEES LICENSED BY THE COMMISSION, AND THE
LEGITIMATE EXPENSES OF PRINTING TICKETS AND ALL ADVERTISING MATERIAL.
  24. DUTY TO PROVIDE  INSURANCE  FOR  LICENSED  PROFESSIONAL  COMBATIVE
SPORTS  PARTICIPANTS.    (A)  ALL  ENTITIES HAVING LICENSES AS PROMOTERS
SHALL CONTINUOUSLY PROVIDE INSURANCE  FOR  THE  PROTECTION  OF  LICENSED
PROFESSIONAL  COMBATIVE  SPORTS  PARTICIPANTS, APPEARING IN PROFESSIONAL
COMBATIVE SPORTS MATCHES OR EXHIBITIONS.  SUCH INSURANCE COVERAGE  SHALL
PROVIDE  FOR REIMBURSEMENT TO THE LICENSED ATHLETE FOR MEDICAL, SURGICAL
AND HOSPITAL CARE, WITH A MINIMUM LIMIT OF FIFTY  THOUSAND  DOLLARS  FOR
INJURIES SUSTAINED WHILE PARTICIPATING IN ANY PROGRAM OPERATED UNDER THE
CONTROL OF SUCH LICENSED PROMOTER AND FOR A PAYMENT OF ONE HUNDRED THOU-
SAND  DOLLARS  TO THE ESTATE OF ANY DECEASED ATHLETE WHERE SUCH DEATH IS
OCCASIONED BY INJURIES RECEIVED DURING THE COURSE OF A MATCH OR  EXHIBI-
TION  IN WHICH SUCH LICENSED ATHLETE PARTICIPATED UNDER THE PROMOTION OR
CONTROL OF ANY LICENSED PROMOTER.  THE COMMISSION MAY FROM TIME TO TIME,
IN ITS DISCRETION, INCREASE THE AMOUNT OF SUCH MINIMUM LIMITS.
  (B) THE FAILURE TO PAY PREMIUMS ON SUCH INSURANCE AS  IS  REQUIRED  BY
PARAGRAPH  (A)  OF THIS SUBDIVISION SHALL BE CAUSE FOR THE SUSPENSION OR
THE REVOCATION OF THE LICENSE OF SUCH DEFAULTING PROMOTER.
  25. NOTICE OF CONTEST; COLLECTION OF TAX. (A) EVERY ENTITY HOLDING ANY
PROFESSIONAL COMBATIVE SPORTS MATCH OR EXHIBITION FOR WHICH AN ADMISSION
FEE IS CHARGED OR RECEIVED, SHALL NOTIFY  THE  ATHLETIC  COMMISSION  TEN
DAYS IN ADVANCE OF THE HOLDING OF SUCH CONTEST. ALL TICKETS OF ADMISSION
TO  ANY  SUCH  MATCH OR EXHIBITION SHALL BE PROCURED FROM A PRINTER DULY
AUTHORIZED BY THE STATE ATHLETIC COMMISSION TO PRINT  SUCH  TICKETS  AND
SHALL BEAR CLEARLY UPON THE FACE THEREOF THE PURCHASE PRICE AND LOCATION
OF  SAME.  AN  ENTITY FAILING TO FULLY COMPLY WITH THIS SECTION SHALL BE
SUBJECT TO A PENALTY OF FIVE HUNDRED DOLLARS TO BE COLLECTED BY AND PAID
TO THE DEPARTMENT OF STATE. AN ENTITY IS PROHIBITED FROM  OPERATING  ANY
MATCHES OR EXHIBITIONS UNTIL ALL PENALTIES DUE PURSUANT TO THIS SUBDIVI-
SION  AND TAXES, INTEREST AND PENALTIES DUE PURSUANT TO ARTICLE NINETEEN
OF THE TAX LAW HAVE BEEN PAID.
  (B) PURSUANT TO DIRECTION BY THE COMMISSIONER OF TAXATION AND FINANCE,
EMPLOYEES OR OFFICERS OF THE ATHLETIC COMMISSION SHALL ACT AS AGENTS  OF
THE  COMMISSIONER  OF TAXATION AND FINANCE TO COLLECT THE TAX IMPOSED BY
ARTICLE NINETEEN OF THE TAX LAW. THE ATHLETIC COMMISSION  SHALL  PROVIDE
THE COMMISSIONER OF TAXATION AND FINANCE WITH SUCH INFORMATION AND TECH-
NICAL  ASSISTANCE  AS  MAY BE NECESSARY FOR THE PROPER ADMINISTRATION OF
SUCH TAX.
  26. REGULATION OF JUDGES. (A) JUDGES FOR  ANY  PROFESSIONAL  COMBATIVE
SPORTS  MATCH  OR  EXHIBITION  UNDER  THE JURISDICTION OF THE COMMISSION
SHALL BE SELECTED BY THE COMMISSION FROM A LIST  OF  QUALIFIED  LICENSED
JUDGES MAINTAINED BY THE COMMISSION.
  (B)  ANY  PROFESSIONAL  COMBATIVE  SPORT PARTICIPANT, MANAGER OR CHIEF
SECOND MAY PROTEST THE ASSIGNMENT OF A JUDGE TO A PROFESSIONAL COMBATIVE
SPORTS MATCH OR EXHIBITION AND  THE  PROTESTING  PROFESSIONAL  COMBATIVE
SPORTS  PARTICIPANT, MANAGER OR CHIEF SECOND MAY BE HEARD BY THE COMMIS-
SION OR ITS DESIGNEE IF SUCH  PROTEST  IS  TIMELY.  IF  THE  PROTEST  IS
UNTIMELY IT SHALL BE SUMMARILY REJECTED.

S. 2609--C                         107

  (C)  EACH  PERSON  SEEKING TO BE LICENSED AS A JUDGE BY THE COMMISSION
SHALL BE REQUIRED TO SUBMIT TO OR PROVIDE PROOF OF  AN  EYE  EXAMINATION
AND  ANNUALLY  THEREAFTER  ON  THE  ANNIVERSARY  OF  THE ISSUANCE OF THE
LICENSE. EACH PERSON SEEKING TO BE A PROFESSIONAL COMBATIVE SPORTS JUDGE
IN  THE  STATE SHALL BE CERTIFIED AS HAVING COMPLETED A TRAINING PROGRAM
AS APPROVED BY THE COMMISSION AND SHALL HAVE PASSED A  WRITTEN  EXAMINA-
TION  APPROVED BY THE COMMISSION COVERING ASPECTS OF PROFESSIONAL COMBA-
TIVE SPORTS INCLUDING, BUT NOT LIMITED TO, THE RULES OF THE  SPORT,  THE
LAW  OF  THE  STATE RELATING TO THE COMMISSION, AND BASIC FIRST AID. THE
COMMISSION SHALL ESTABLISH CONTINUING EDUCATION PROGRAMS TO KEEP  LICEN-
SEES CURRENT ON AREAS OF REQUIRED KNOWLEDGE.
  (D)  EACH  PERSON  SEEKING  A  LICENSE  TO BE A PROFESSIONAL COMBATIVE
SPORTS JUDGE IN THIS STATE SHALL BE REQUIRED TO  FILL  OUT  A  FINANCIAL
QUESTIONNAIRE CERTIFYING UNDER PENALTY OF PERJURY FULL DISCLOSURE OF THE
JUDGE'S  FINANCIAL SITUATION ON A QUESTIONNAIRE TO BE PROMULGATED BY THE
COMMISSION. SUCH QUESTIONNAIRE SHALL BE IN A FORM AND MANNER APPROVED BY
THE COMMISSION AND SHALL PROVIDE INFORMATION AS TO AREAS  OF  ACTUAL  OR
POTENTIAL   CONFLICTS  OF  INTEREST  AS  WELL  AS  APPEARANCES  OF  SUCH
CONFLICTS, INCLUDING FINANCIAL RESPONSIBILITY. WITHIN FORTY-EIGHT  HOURS
OF ANY PROFESSIONAL COMBATIVE SPORTS MATCH OR EXHIBITION, EACH COMBATIVE
SPORTS  JUDGE  SHALL  FILE  WITH  THE  COMMISSION A FINANCIAL DISCLOSURE
STATEMENT IN SUCH FORM AND MANNER AS SHALL BE ACCEPTABLE TO THE  COMMIS-
SION.
  (E)  ONLY A PERSON LICENSED BY THE COMMISSION MAY JUDGE A PROFESSIONAL
COMBATIVE SPORTS MATCH OR EXHIBITION.
  27. TRAINING FACILITIES. (A) THE COMMISSION MAY, IN ITS DISCRETION AND
IN ACCORDANCE WITH REGULATIONS ADOPTED BY THE COMMISSION TO PROTECT  THE
HEALTH AND SAFETY OF PROFESSIONAL COMBATIVE SPORT PARTICIPANTS IN TRAIN-
ING,  ISSUE  A  LICENSE TO OPERATE A TRAINING FACILITY PROVIDING CONTACT
SPARRING MAINTAINED EITHER EXCLUSIVELY OR IN PART FOR THE USE OF PROFES-
SIONAL COMBATIVE SPORT PARTICIPANTS. THE REGULATIONS OF  THE  COMMISSION
SHALL  INCLUDE, BUT NOT BE LIMITED TO, THE FOLLOWING SUBJECTS TO PROTECT
THE HEALTH AND SAFETY OF PROFESSIONAL COMBATIVE SPORT PARTICIPANTS:
  (1) REQUIREMENTS FOR FIRST AID MATERIALS TO BE STORED IN AN ACCESSIBLE
LOCATION ON THE PREMISES AND FOR THE  PRESENCE  ON  THE  PREMISES  OF  A
PERSON TRAINED AND CERTIFIED IN THE USE OF SUCH MATERIALS AND PROCEDURES
FOR CARDIO-PULMONARY RESUSCITATION AT ALL TIMES DURING WHICH THE FACILI-
TY IS OPEN FOR TRAINING PURPOSES;
  (2) PROMINENT POSTING ADJACENT TO AN ACCESSIBLE TELEPHONE OF THE TELE-
PHONE NUMBER FOR EMERGENCY MEDICAL SERVICES AT THE NEAREST HOSPITAL;
  (3)  CLEAN AND SANITARY BATHROOMS, SHOWER ROOMS, LOCKER ROOMS AND FOOD
SERVING AND STORAGE AREAS;
  (4) ADEQUATE VENTILATION AND  LIGHTING  OF  ACCESSIBLE  AREAS  OF  THE
TRAINING FACILITY;
  (5) ESTABLISHMENT OF A POLICY CONCERNING THE RESTRICTION OF SMOKING IN
TRAINING AREAS, INCLUDING PROVISIONS FOR ITS ENFORCEMENT BY THE FACILITY
OPERATOR;
  (6) COMPLIANCE WITH STATE AND LOCAL FIRE ORDINANCES;
  (7) INSPECTION AND APPROVAL OF RINGS AS REQUIRED BY SUBDIVISION THIRTY
OF THIS SECTION; AND
  (8)  ESTABLISHMENT  OF  A  POLICY  FOR  POSTING ALL COMMISSION LICENSE
SUSPENSIONS AND LICENSE REVOCATIONS RECEIVED FROM THE COMMISSION INCLUD-
ING PROVISIONS FOR ENFORCEMENT OF SUCH SUSPENSIONS  AND  REVOCATIONS  BY
THE FACILITY OPERATOR.
  (B)  A  PROSPECTIVE LICENSEE SHALL SUBMIT TO THE COMMISSION PROOF THAT
IT CAN FURNISH SUITABLE FACILITIES  IN  WHICH  THE  TRAINING  IS  TO  BE

S. 2609--C                         108

CONDUCTED,  INCLUDING  THE  MAKING OF SUCH TRAINING FACILITIES AVAILABLE
FOR INSPECTION BY THE COMMISSION AT ANY TIME DURING WHICH TRAINING IS IN
PROGRESS.
  28.  TEMPORARY  TRAINING  FACILITIES.  ANY TRAINING FACILITY PROVIDING
CONTACT SPARRING ESTABLISHED AND MAINTAINED ON A TEMPORARY BASIS FOR THE
PURPOSE OF PREPARING A PROFESSIONAL COMBATIVE SPORT  PARTICIPANT  FOR  A
SPECIFIC  PROFESSIONAL  COMBATIVE  SPORTS  MATCH  OR  EXHIBITION  TO  BE
CONDUCTED, HELD OR GIVEN WITHIN THE STATE OF NEW YORK  SHALL  BE  EXEMPT
FROM  THIS  ACT  INSOFAR AS IT CONCERNS THE LICENSING OF SUCH FACILITIES
IF, IN THE JUDGMENT OF THE COMMISSION, ESTABLISHMENT AND MAINTENANCE  OF
SUCH  FACILITY  WILL  BE  CONSISTENT WITH THE PURPOSES AND PROVISIONS OF
THIS CHAPTER, THE BEST INTERESTS OF PROFESSIONAL COMBATIVE SPORTS GENER-
ALLY, AND THE PUBLIC INTEREST, CONVENIENCE OR NECESSITY.
  29. WEIGHTS; CLASSES AND RULES. THE WEIGHTS AND CLASSES  OF  COMBATIVE
SPORT  PARTICIPANTS AND THE RULES AND REGULATIONS OF PROFESSIONAL COMBA-
TIVE SPORTS SHALL BE PRESCRIBED BY THE COMMISSION.
  30. RINGS OR FIGHTING AREAS.  NO PROFESSIONAL COMBATIVE  SPORTS  MATCH
OR  EXHIBITION  OR  TRAINING  ACTIVITY SHALL BE PERMITTED IN ANY RING OR
FIGHTING AREA UNLESS SUCH RING OR FIGHTING AREA HAS BEEN  INSPECTED  AND
APPROVED  BY  THE  COMMISSION.  THE  COMMISSION SHALL PRESCRIBE STANDARD
ACCEPTABLE SIZE AND QUALITY REQUIREMENTS FOR RINGS OR FIGHTING AREAS AND
APPURTENANCES THERETO.
  31. MISDEMEANOR. ANY ENTITY WHO INTENTIONALLY, DIRECTLY OR  INDIRECTLY
CONDUCTS,  HOLDS OR GIVES A PROFESSIONAL COMBATIVE SPORTS MATCH OR EXHI-
BITION OR PARTICIPATES EITHER DIRECTLY OR INDIRECTLY IN ANY  SUCH  MATCH
OR  EXHIBITION  AS A REFEREE, JUDGE, CORPORATION TREASURER, PROFESSIONAL
COMBATIVE  SPORTS  PARTICIPANT,  MANAGER,  PROMOTER,  TRAINER  OR  CHIEF
SECOND,  WITHOUT  FIRST HAVING PROCURED AN APPROPRIATE LICENSE OR PERMIT
AS PRESCRIBED IN THIS SECTION SHALL BE GUILTY OF A MISDEMEANOR.
  S 3. Section 6 of chapter 912 of the laws  of  1920  relating  to  the
regulation  of boxing, sparring and wrestling, as amended by chapter 437
of the laws of 2002 and subdivision 1 as designated and subdivision 2 as
added by chapter 673 of the laws of 2003, is amended to read as follows:
  S 6. Jurisdiction of commission. 1.  The  commission  shall  have  and
hereby is vested with the sole direction, management, control and juris-
diction  over  all  such  boxing  and sparring matches or exhibitions OR
PROFESSIONAL COMBATIVE SPORTS MATCHES OR EXHIBITIONS  to  be  conducted,
held  or given within the state of New York and over all licenses to any
and all persons who participate in such boxing or  sparring  matches  or
exhibitions  OR PROFESSIONAL COMBATIVE SPORTS MATCHES OR EXHIBITIONS and
over any and all gyms, clubs, training  camps  and  other  organizations
that maintain training facilities providing contact sparring for persons
who  prepare  for  participation  in  such boxing or sparring matches or
exhibitions OR PROFESSIONAL COMBATIVE SPORTS MATCHES OR EXHIBITIONS, and
over the promotion of professional wrestling exhibitions OR PROFESSIONAL
COMBATIVE SPORTS MATCHES OR EXHIBITIONS to the extent  provided  for  in
sections  5,  9, 19, 20, 28-a, 28-b and 33 of this act, except as other-
wise provided in this act.
  2. The commission is authorized and directed to require that all sites
wherein boxing,  sparring  and  wrestling  matches  and  exhibitions  OR
PROFESSIONAL COMBATIVE SPORTS MATCHES OR EXHIBITIONS are conducted shall
comply  with  state  and  applicable local sanitary codes appropriate to
school athletic facilities.
  S 4. Subdivision 1 of section 451  of  the  tax  law,  as  amended  by
section  1  of  part F of chapter 407 of the laws of 1999, is amended to
read as follows:

S. 2609--C                         109

  1. "Gross receipts from ticket  sales"  shall  mean  the  total  gross
receipts of every person from the sale of tickets to any professional or
amateur boxing, sparring or wrestling match or exhibition OR ANY PROFES-
SIONAL  COMBATIVE  SPORTS  MATCH  OR  EXHIBITION held in this state, and
without  any  deduction  whatsoever for commissions, brokerage, distrib-
ution fees, advertising or any other expenses, charges  and  recoupments
in respect thereto.
  S  5. Section 452 of the tax law, as amended by section 2 of part F of
chapter 407 of the laws of 1999, is amended to read as follows:
  S 452. Imposition of tax. 1. On  and  after  October  first,  nineteen
hundred  ninety-nine, a tax is hereby imposed and shall be paid upon the
gross receipts of every  person  holding  any  professional  or  amateur
boxing,  sparring  or  wrestling match or exhibition in this state. Such
tax shall be imposed on such gross receipts, exclusive  of  any  federal
taxes, as follows:
  (a)  three percent of gross receipts from ticket sales, except that in
no event shall the tax imposed by this  [subdivision]  PARAGRAPH  exceed
fifty thousand dollars for any match or exhibition;
  (b)  three  percent of gross receipts from broadcasting rights, except
that in no event shall the tax imposed by this  [subdivision]  PARAGRAPH
exceed fifty thousand dollars for any match or exhibition.
  2. ON AND AFTER THE EFFECTIVE DATE OF THIS SUBDIVISION, A TAX IS HERE-
BY  IMPOSED  AND  SHALL  BE PAID UPON THE GROSS RECEIPTS OF EVERY PERSON
HOLDING ANY PROFESSIONAL COMBATIVE SPORTS MATCH OR  EXHIBITION  IN  THIS
STATE.  SUCH  TAX  SHALL BE IMPOSED ON SUCH GROSS RECEIPTS, EXCLUSIVE OF
ANY FEDERAL TAXES, AS FOLLOWS:
  (A) EIGHT AND ONE-HALF PERCENT OF GROSS RECEIPTS  FROM  TICKET  SALES;
AND
  (B)  THREE  PERCENT OF GROSS RECEIPTS FROM BROADCASTING RIGHTS, EXCEPT
THAT IN NO EVENT SHALL THE TAX IMPOSED BY THIS  PARAGRAPH  EXCEED  FIFTY
THOUSAND DOLLARS FOR ANY MATCH OR EXHIBITION.
  S 6. Paragraph 1 of subdivision (f) of section 1105 of the tax law, as
amended  by section 100 of part A of chapter 389 of the laws of 1997, is
amended to read as follows:
  (1) Any admission charge where such admission charge is in  excess  of
ten  cents  to  or  for  the use of any place of amusement in the state,
except charges for admission to race tracks, boxing, sparring or wrestl-
ing matches or exhibitions, OR PROFESSIONAL MIXED MARTIAL  ARTS  MATCHES
OR  EXHIBITIONS  which  charges  are  taxed  under any other law of this
state, or dramatic or musical arts performances, or live circus perform-
ances, or motion picture theaters, and except charges to  a  patron  for
admission  to,  or  use  of, facilities for sporting activities in which
such patron is to be a participant, such as bowling alleys and  swimming
pools. For any person having the permanent use or possession of a box or
seat or a lease or a license, other than a season ticket, for the use of
a  box or seat at a place of amusement, the tax shall be upon the amount
for which a similar box or seat is sold for each performance or  exhibi-
tion  at which the box or seat is used or reserved by the holder, licen-
see or lessee, and shall be paid by the holder, licensee or lessee.
  S 7. This act shall take effect on the ninetieth day  after  it  shall
have become a law, and shall expire and be deemed repealed 3 years after
it shall take effect; provided, however, that effective immediately, the
addition,  amendment  and/or  repeal of any rule or regulation necessary
for the implementation of this act on its effective date  is  authorized
and directed to be made and completed on or before such effective date.

S. 2609--C                         110

                                 PART ZZ

  Section  1.  This  act  shall  be known and may be cited as "state and
local government master settlement agreement proceeds safeguard act."
  S 2. Legislative intent. New York state,  New  York  city  and  county
governments  throughout  the  state  are  the  recipients of hundreds of
millions of dollars each year under the master settlement agreement. The
total of all master settlement payments to these  governments  over  the
years has so far exceeded eleven billion dollars. These funds are vital-
ly  important and any disruption in these payments would put the recipi-
ents at financial risk. The legislature hereby finds that it is  in  the
public  interest to enact the "state and local government master settle-
ment agreement proceeds safeguard act" in order to continue the flow  of
these  funds  to  the  state  and local governments which depend on this
revenue during the appeal of a judgment against master settlement agree-
ment signatories, affiliates, successors and non-participating  manufac-
turers.
  S  3.  The  civil  practice  law  and rules is amended by adding a new
section 5519-a to read as follows:
  S 5519-A. STAY OF ENFORCEMENT FOR MASTER SETTLEMENT AGREEMENT  PARTIC-
IPATING OR NON-PARTICIPATING MANUFACTURERS OR THEIR SUCCESSORS OR AFFIL-
IATES.  (A)  IN  CIVIL  LITIGATION  UNDER  ANY  LEGAL THEORY INVOLVING A
PARTICIPATING MANUFACTURER OR NON-PARTICIPATING MANUFACTURER,  AS  THOSE
TERMS  ARE  DEFINED  IN THE MASTER SETTLEMENT AGREEMENT, OR ANY OF THEIR
SUCCESSORS OR AFFILIATES, THE UNDERTAKING REQUIRED DURING  THE  PENDENCY
OF ALL APPEALS OR DISCRETIONARY REVIEWS BY ANY APPELLATE COURTS IN ORDER
TO STAY THE EXECUTION OF ANY JUDGMENT OR ORDER GRANTING LEGAL, EQUITABLE
OR  OTHER RELIEF DURING THE ENTIRE COURSE OF APPELLATE REVIEW, INCLUDING
REVIEW BY THE UNITED STATES SUPREME COURT, SHALL BE SET PURSUANT TO  THE
APPLICABLE PROVISIONS OF LAW OR COURT RULES; PROVIDED, HOWEVER, THAT THE
TOTAL  UNDERTAKING  REQUIRED  OF  ALL  APPELLANTS COLLECTIVELY SHALL NOT
EXCEED TWO HUNDRED FIFTY MILLION DOLLARS, REGARDLESS OF THE VALUE OF THE
JUDGMENT APPEALED. THIS LIMITATION SHALL APPLY ONLY IF  APPELLANTS  FILE
AT  LEAST  THIRTY  PERCENT OF THE TOTAL AMOUNT OF THE UNDERTAKING IN THE
FORM OF CASH, A LETTER OF CREDIT, A CERTIFICATE  OF  DEPOSIT,  OR  OTHER
CASH  EQUIVALENT  WITH  THE  COURT. THE CASH OR CASH EQUIVALENT SHALL BE
DEPOSITED BY THE CLERK OF THE COURT IN THE ACCOUNT OF THE COURT, AND ANY
INTEREST EARNED SHALL BE UTILIZED AS PROVIDED BY LAW.
  (B) NOTWITHSTANDING THE PROVISIONS OF SUBDIVISION (A) OF THIS SECTION,
UPON PROOF BY A PREPONDERANCE OF THE EVIDENCE, BY AN APPELLEE,  THAT  AN
APPELLANT  IS DISSIPATING ASSETS OUTSIDE THE COURSE OF ORDINARY BUSINESS
TO AVOID PAYMENT OF A JUDGMENT, A COURT MAY  REQUIRE  THE  APPELLANT  TO
POST A BOND IN AN AMOUNT UP TO THE TOTAL AMOUNT OF THE JUDGMENT.
  (C)  AS USED IN THIS SECTION, "MASTER SETTLEMENT AGREEMENT" SHALL HAVE
THE SAME MEANING AS SET FORTH IN SUBDIVISION FIVE  OF  SECTION  THIRTEEN
HUNDRED NINETY-NINE-OO OF THE PUBLIC HEALTH LAW.
  S  4.  This  act shall take effect on the thirtieth day after it shall
have become a law, and shall apply to any cause of action pending on  or
filed on or after such effective date.

                                PART AAA

  Section  1.  Subparagraph  (vi)  of  paragraph (a) of subdivision 1 of
section 210 of the tax law, as amended by section 1 of part C of chapter
56 of the laws of 2011, is amended to read as follows:

S. 2609--C                         111

  (vi) for taxable years beginning on or after January thirty-first, two
thousand seven, the amount prescribed by this paragraph for  a  taxpayer
which  is  a  qualified  New York manufacturer, shall be computed at the
rate of six and one-half (6.5) percent  of  the  taxpayer's  entire  net
income  base. For taxable years beginning on or after January first, two
thousand twelve and before January  first,  two  thousand  fifteen,  the
amount  prescribed by this paragraph for a taxpayer which is an eligible
qualified New York manufacturer shall be computed at the rate  of  three
and one-quarter (3.25) percent of the taxpayer's entire net income base.
The  term  "manufacturer" shall mean a taxpayer which during the taxable
year is principally engaged in the production of goods by manufacturing,
processing, assembling, refining, mining, extracting, farming,  agricul-
ture,  horticulture,  floriculture,  viticulture  or commercial fishing.
However, the generation and distribution of  electricity,  the  distrib-
ution  of  natural  gas, and the production of steam associated with the
generation of electricity shall  not  be  qualifying  activities  for  a
manufacturer under this subparagraph. Moreover, the combined group shall
be considered a "manufacturer" for purposes of this subparagraph only if
the combined group during the taxable year is principally engaged in the
activities  set  forth  in this paragraph, or any combination thereof. A
taxpayer or a combined group shall be "principally  engaged"  in  activ-
ities  described  above  if,  during  the  taxable year, more than fifty
percent of the gross receipts of the taxpayer or combined group, respec-
tively, are derived from receipts from the sale  of  goods  produced  by
such  activities. In computing a combined group's gross receipts, inter-
corporate receipts shall be eliminated. A "qualified New  York  manufac-
turer"  is  a  manufacturer  which  has  property  in  New York which is
described in clause (A) of subparagraph (i) of paragraph (b) of subdivi-
sion twelve of this section and either (I) the adjusted  basis  of  such
property  for  federal  income  tax purposes at the close of the taxable
year is at least one million  dollars  or  (II)  all  of  its  real  and
personal  property is located in New York. In addition, a "qualified New
York manufacturer" means (A) a taxpayer which is defined as a  qualified
emerging  technology  company  under paragraph (c) of subdivision one of
section thirty-one hundred two-e of the public authorities  law  regard-
less  of the ten million dollar limitation expressed in subparagraph one
of such paragraph (c), OR (B)  A  TAXPAYER  OR  A  COMBINED  GROUP  THAT
EMPLOYS  IN  NEW YORK DURING THE TAXABLE YEAR AT LEAST TWO THOUSAND FIVE
HUNDRED EMPLOYEES IN ANY OF THE QUALIFYING ACTIVITIES FOR A MANUFACTURER
DESCRIBED IN THIS SUBPARAGRAPH AND HAS PROPERTY IN  NEW  YORK  WHICH  IS
DESCRIBED IN CLAUSE (A) OF SUBPARAGRAPH (I) OF PARAGRAPH (B) OF SUBDIVI-
SION  TWELVE  OF  THIS  SECTION, THE ADJUSTED BASIS OF WHICH FOR FEDERAL
INCOME TAX PURPOSES AT THE CLOSE OF THE TAXABLE YEAR  IS  AT  LEAST  ONE
HUNDRED MILLION DOLLARS. The commissioner shall establish guidelines and
criteria  that specify requirements by which a manufacturer may be clas-
sified as an eligible qualified  New  York  manufacturer.  Criteria  may
include but not be limited to factors such as regional unemployment, the
economic  impact  that  manufacturing  has on the surrounding community,
population decline within the region and median income within the region
in which the manufacturer is located. In establishing  these  guidelines
and criteria, the commissioner shall endeavor that the total annual cost
of the lower rates shall not exceed twenty-five million dollars.
  S  2.  Subparagraph 2 of paragraph (b) of subdivision 1 of section 210
of the tax law, as amended by section 1 of part GG-1 of  chapter  57  of
the laws of 2008, is amended to read as follows:

S. 2609--C                         112

  (2)  For  purposes  of  subparagraph  one  of this paragraph, the term
"manufacturer" shall mean a taxpayer which during the  taxable  year  is
principally  engaged  in the production of goods by manufacturing, proc-
essing, assembling, refining, mining, extracting, farming,  agriculture,
horticulture, floriculture, viticulture or commercial fishing. Moreover,
for  purposes  of  computing  the capital base in a combined report, the
combined group shall be considered a "manufacturer" for purposes of this
subparagraph only if the combined group during the taxable year is prin-
cipally engaged in the activities set forth in this subparagraph, or any
combination thereof. A taxpayer or a combined group shall be "principal-
ly engaged" in activities described above if, during the  taxable  year,
more  than  fifty  percent  of  the  gross  receipts  of the taxpayer or
combined group, respectively, are derived from receipts from the sale of
goods produced by such activities. In computing a combined group's gross
receipts, intercorporate receipts shall be eliminated. A "qualified  New
York  manufacturer" is a manufacturer that has property in New York that
is described in clause (A) of  subparagraph  (i)  of  paragraph  (b)  of
subdivision  twelve of this section and either (i) the adjusted basis of
that property for federal income tax purposes at the close of the  taxa-
ble  year  is  at  least one million dollars or (ii) all of its real and
personal property is located in New York. In addition, a "qualified  New
York  manufacturer"  means (A) a taxpayer that is defined as a qualified
emerging technology company under paragraph (c) of  subdivision  one  of
section  thirty-one  hundred two-e of the public authorities law regard-
less of the ten million dollar limitation expressed in subparagraph  one
of such paragraph, OR (B) A TAXPAYER OR A COMBINED GROUP THAT EMPLOYS IN
NEW  YORK  DURING  THE  TAXABLE  YEAR AT LEAST TWO THOUSAND FIVE HUNDRED
EMPLOYEES IN  ANY  OF  THE  QUALIFYING  ACTIVITIES  FOR  A  MANUFACTURER
DESCRIBED  IN  THIS  SUBPARAGRAPH  AND HAS PROPERTY IN NEW YORK WHICH IS
DESCRIBED IN CLAUSE (A) OF SUBPARAGRAPH (I) OF PARAGRAPH (B) OF SUBDIVI-
SION TWELVE OF THIS SECTION, THE ADJUSTED BASIS  OF  WHICH  FOR  FEDERAL
INCOME  TAX  PURPOSES  AT  THE CLOSE OF THE TAXABLE YEAR IS AT LEAST ONE
HUNDRED MILLION DOLLARS.
  S 3. This act shall take effect immediately and apply to taxable years
beginning on or after January 1, 2013.

                                PART BBB

  Section 1. Subparagraph (B) of  paragraph  1  of  subdivision  (b)  of
section 483 of the tax law, as amended by chapter 1 of the laws of 1999,
is amended to read as follows:
  (B) In the absence of the filing with the commissioner of satisfactory
proof  of  a lesser cost of doing business of the agent making the sale,
the cost of doing business by the agent shall be presumed to  be  seven-
eighths  of  one  percent  of  the basic cost of cigarettes for sales to
wholesale dealers plus [one cent] SEVEN CENTS per package of  ten  ciga-
rettes, [two] FOURTEEN cents per package of twenty cigarettes and in the
case  of  a package containing more than twenty cigarettes, [two] SEVEN-
TEEN cents and one-half of a cent for each five cigarettes in excess  of
twenty  cigarettes,  one and one-half percent of the basic cost of ciga-
rettes for sales to chain stores plus [one cent] SIX CENTS  per  package
of  ten  cigarettes, [two] TWELVE cents per package of twenty cigarettes
and in the case of a package containing  more  than  twenty  cigarettes,
[two] SEVENTEEN cents and one-half of a cent for each five cigarettes in
excess  of  twenty cigarettes and three and seven-eighths percent of the
basic cost of cigarettes with respect to sales to  retail  dealers  plus

S. 2609--C                         113

[one  cent] SIX CENTS per package of ten cigarettes, [two] FIFTEEN cents
per package of twenty cigarettes and in the case of a package containing
more than twenty cigarettes, [two] SEVENTEEN cents  and  one-half  of  a
cent  for  each  five  cigarettes in excess of twenty cigarettes and the
foregoing cents per pack shall be included in the "cost of  doing  busi-
ness  by  the  agent"  referred  to  in paragraphs two and three of this
subdivision.
  S 2. This act shall take effect July 1, 2013; provided, however,  that
if  this act shall not have become a law on or before July 1, 2013, then
this act shall take effect immediately and shall be deemed to have  been
in full force and effect on and after July 1, 2013.

                                PART CCC

  Section  1.  The  tax  law is amended by adding a new section 630-c to
read as follows:
  S 630-C. GIFT FOR NEW YORK STATE TEEN HEALTH EDUCATION FUND. AN  INDI-
VIDUAL  IN  ANY  TAXABLE YEAR MAY ELECT TO CONTRIBUTE TO THE TEEN HEALTH
EDUCATION FUND FOR EDUCATIONAL PROGRAMS IN SCHOOLS  RELATED  TO  HEALTH.
THE  CONTRIBUTION  SHALL  BE  IN  ANY  WHOLE DOLLAR AMOUNT AND SHALL NOT
REDUCE THE AMOUNT OF STATE TAX OWED BY SUCH INDIVIDUAL. THE COMMISSIONER
SHALL INCLUDE SPACE ON THE  PERSONAL  INCOME  TAX  RETURN  TO  ENABLE  A
TAXPAYER  TO MAKE SUCH CONTRIBUTION. NOTWITHSTANDING ANY OTHER PROVISION
OF LAW ALL REVENUES COLLECTED PURSUANT TO THIS SECTION SHALL BE CREDITED
TO THE NEW YORK STATE TEEN HEALTH EDUCATION FUND AND USED ONLY FOR THOSE
PURPOSES ENUMERATED IN SECTION NINETY-NINE-U OF THE STATE FINANCE LAW.
  S 2. The state finance law is amended by adding a new section 99-u  to
read as follows:
  S  99-U. NEW YORK STATE TEEN HEALTH EDUCATION FUND. 1. THERE IS HEREBY
ESTABLISHED IN THE CUSTODY OF THE COMMISSIONER OF TAXATION AND FINANCE A
SPECIAL ACCOUNT TO BE KNOWN AS THE "NEW YORK STATE TEEN HEALTH EDUCATION
FUND".
  2. SUCH FUND SHALL CONSIST OF ALL REVENUES RECEIVED BY THE  DEPARTMENT
OF  TAXATION  AND  FINANCE,  PURSUANT  TO  THE PROVISIONS OF SECTION SIX
HUNDRED THIRTY-C OF THE TAX LAW AND ALL OTHER MONEYS APPROPRIATED THERE-
TO FROM ANY OTHER FUND OR SOURCE PURSUANT TO LAW. NOTHING  CONTAINED  IN
THIS  SECTION  SHALL  PREVENT  THE STATE FROM RECEIVING GRANTS, GIFTS OR
BEQUESTS FOR THE PURPOSES OF THE FUND AS DEFINED  IN  THIS  SECTION  AND
DEPOSITING THEM INTO THE FUND ACCORDING TO LAW.
  3.  THE MONEYS IN SAID ACCOUNT SHALL BE RETAINED BY THE FUND AND SHALL
BE RELEASED BY THE  COMMISSIONER  OF  TAXATION  AND  FINANCE  ONLY  UPON
CERTIFICATES  SIGNED  BY  THE  COMMISSIONER  OF  EDUCATION OR HIS OR HER
DESIGNEE AND ONLY FOR THE PURPOSES SET FORTH IN THIS SECTION.
  4. THE MONEYS IN SUCH FUND  SHALL  BE  EXPENDED  FOR  THE  PURPOSE  OF
SUPPLEMENTING  EDUCATIONAL  PROGRAMS IN SCHOOLS FOR HEALTH AND AWARENESS
OF ISSUES FACING TEENS TODAY WHEN IT COMES TO THEIR  HEALTH.    ELIGIBLE
HEALTH  PROGRAMS  ARE  THOSE  WITH  AN  ESTABLISHED CURRICULUM PROVIDING
INSTRUCTION ON ALCOHOL, TOBACCO AND OTHER  DRUG  ABUSE  PREVENTION,  THE
CAUSES  AND  PROBLEMS ASSOCIATED WITH TEEN OBESITY, AND FOR AWARENESS OF
THE SYMPTOMS OF TEEN ENDOMETRIOSIS.
  S 3. This act shall take effect immediately.

                                PART DDD

S. 2609--C                         114

  Section 1. Paragraph (c) of subdivision 1 of section 1703 of  the  tax
law,  as added by section 1 of part E of chapter 57 of the laws of 2010,
is amended to read as follows:
  (c)  Any  information  received  by  the  department on an information
return filed pursuant to this section, concerning a person  who  is  not
subject to tax in New York, or is not subject to any requirement imposed
by  or pursuant to the authority of this chapter, may not be used by the
department. The department shall not redisclose any information received
on an information return filed pursuant to this section, EXCEPT THAT  IT
MAY DISCLOSE TO THE COMMISSIONER OF FINANCE OF THE CITY OF NEW YORK, FOR
THE  PURPOSE  OF THE ADMINISTRATION OF LAWS RELATING TO TAXES OR CHARGES
COLLECTED BY THE COMMISSIONER OF FINANCE OF THE CITY OF NEW YORK, INFOR-
MATION RECEIVED ON SUCH RETURNS CONCERNING ANY PERSON OR ENTITY  WITH  A
NEW  YORK  CITY  ADDRESS  OR THAT IS A NEW YORK CITY TAXPAYER OR THAT IS
REQUIRED TO PAY NEW YORK CITY TAXES AND/OR CHARGES OR THAT IS SUBJECT TO
ANY REPORTING REQUIREMENT PURSUANT TO NEW YORK CITY TAX LAWS.
  S 2. This act shall take effect immediately.

                                PART EEE

  Section 1. Section 1604 of the tax law is amended by adding  four  new
subdivisions d, e, f and g to read as follows:
  D.  THE  COMMISSION MAY CONTRACT WITH ONE OR MORE PERSONS TO ALLOW THE
PLACEMENT OF ADVERTISING OR  PROMOTIONAL  MATERIAL  ON  AVAILABLE  MEDIA
RELATED TO ANY ONLINE LOTTERY GAME OR TO SPONSOR INDIVIDUAL DRAWS IN ANY
ONLINE LOTTERY GAME. IF THE COMMISSION ENTERS INTO A CONTRACT UNDER THIS
SUBDIVISION,  THE  COMMISSION  SHALL  ALLOW  AT LEAST ONE MINUTE BETWEEN
DRAWS OF ONLINE LOTTERY GAMES DURING WHICH ONE  OR  MORE  ADVERTISEMENTS
MAY BE EXHIBITED.
  E.  A  CONTRACT ENTERED INTO UNDER SUBDIVISION D OF THIS SECTION SHALL
PROVIDE THAT  ANY  ADVERTISEMENTS  EXHIBITED  BETWEEN  DRAWS  OF  ONLINE
LOTTERY GAMES SHALL COMPLY WITH CONTENT REGULATIONS FOR TELEVISED BROAD-
CAST  ADOPTED  BY THE FEDERAL COMMUNICATIONS COMMISSION, WITH THE EXCEP-
TION THAT THE ADVERTISING  UNDER  SUBDIVISION  D  OF  THIS  SECTION  MAY
INCLUDE ADVERTISEMENTS FOR ALCOHOLIC BEVERAGES WITH RESTRICTIONS IMPOSED
ONLY BY THE COMMISSION.
  F.  THE  COMMISSION  SHALL  SOLICIT  BIDS FROM RESPONSIBLE PERSONS FOR
ADVERTISING  OR  PROMOTIONAL  CONTRACTS  UNDER  SUBDIVISION  D  OF  THIS
SECTION.  THE COMMISSION SHALL SELECT FROM AMONG THE BIDS RECEIVED SO AS
TO PRODUCE THE MAXIMUM AMOUNT OF NET REVENUE FOR  THE  STATE  CONSISTENT
WITH  THE  GENERAL  WELFARE  OF  THE  CITIZENS OF THE STATE. IN DECIDING
WHETHER TO ENTER INTO A CONTRACT UNDER SUBDIVISION D  OF  THIS  SECTION,
THE  COMMISSION  SHALL  CONSIDER  WHETHER  THE TERMS OF THE CONTRACT ARE
COMPARABLE TO THE TERMS OF SIMILAR ADVERTISING OR PROMOTIONAL  CONTRACTS
RELATING TO LOTTERY OR OTHER GAMING IN OTHER STATES.
  G.  THE  COMMISSION,  SUBJECT  TO  APPLICABLE  LAWS RELATING TO PUBLIC
CONTRACTS, MAY ENTER INTO CONTRACTS WITH ONE OR MORE  PERSONS  TO  ALLOW
THE  PLACEMENT OF ADVERTISING OR PROMOTIONAL MATERIAL, INCLUDING BUT NOT
LIMITED TO, THE PLACEMENT OF  DISCOUNT  COUPONS  FOR  RETAIL  GOODS,  ON
LOTTERY  TICKETS, SHARES, AND OTHER AVAILABLE MEDIA UNDER THE CONTROL OF
THE DIVISION. HOWEVER, EXCEPT FOR ADVERTISING THAT PROMOTES  RESPONSIBLE
CONSUMPTION  OF  ALCOHOLIC BEVERAGES, THE COMMISSION SHALL NOT ALLOW THE
PLACEMENT OF ADVERTISING FOR THE PROMOTION OF THE CONSUMPTION  OF  ALCO-
HOLIC BEVERAGES OR TOBACCO PRODUCTS ON LOTTERY TICKETS UNDER THE CONTROL
OF THE COMMISSION.
  S 2. This act shall take effect immediately.

S. 2609--C                         115

                                PART FFF

  Section  1. Subdivision b of section 1617-a of the tax law, as amended
by section 5 of part K of chapter 57 of the laws of 2010, is amended  to
read as follows:
  b. Video lottery gaming shall only be permitted for no more than twen-
ty  consecutive  hours  per  day  and  on no day shall such operation be
conducted past [4:00] 6:00 a.m.
  S 2. Paragraph 3 of subdivision f of section 1617-a of the tax law, as
added by section 2 of part O of chapter 61  of  the  laws  of  2011,  is
amended to read as follows:
  (3) For each video lottery facility, the annual value of the free play
allowance  credits  authorized  for use by the operator pursuant to this
subdivision shall not exceed an amount equal to [ten] FIFTEEN percent of
the total amount wagered on video lottery games after payout of  prizes.
The  division shall establish procedures to assure that free play allow-
ance credits do not exceed such amount.
  S 3. This act shall take effect immediately.

                                PART GGG

  Section 1. The state comptroller is hereby authorized and directed  to
loan  money in accordance with the provisions set forth in subdivision 5
of section 4 of the state finance law  to  the  following  funds  and/or
accounts:
  1. Tuition reimbursement fund:
  a. Tuition reimbursement account (20451).
  b. Proprietary vocational school supervision account (20452).
  2. Local government records management improvement fund:
  a. Local government records management account (20501).
  3. Dedicated highway and bridge trust fund:
  a. Highway and bridge capital account (30051).
  4. State university residence hall rehabilitation fund.
  5. State parks infrastructure trust fund:
  a. State parks infrastructure account (30351).
  6. Clean water/clean air implementation fund.
  7. Employees health insurance fund.
  a. Employees health insurance account (60201).
  8. State lottery fund:
  a. Education - New (20901).
  b. VLT - Sound basic education fund (20904).
  9. Medicaid management information system escrow fund.
  10. Sewage treatment program management and administration fund.
  11. Environmental conservation special revenue fund:
  a. Waste cleanup and management account (21053).
  b. Hazardous bulk storage account (21061).
  c. Great lakes restoration initiative account (21087).
  d. Low level radioactive waste siting account (21066).
  e. Recreation account (21067).
  f. Public safety recovery account (21077).
  g. Conservationist magazine account (21080).
  h. Environmental regulatory account (21081).
  i. Natural resource account (21082).
  j. Mined land reclamation program account (21084).
  k. Federal grants indirect cost recovery account (21065).
  12. Environmental protection and oil spill compensation fund.

S. 2609--C                         116

  13. Hazardous waste remedial fund:
  a. Hazardous waste remedial cleanup account (31506).
  14. Mass transportation operating assistance fund:
  a. Public transportation systems account (21401).
  b. Metropolitan mass transportation (21402).
  15. Clean air fund:
  a. Operating permit program account (21451).
  b. Mobile source account (21452).
  16. Centralized services fund.
  17. State exposition special fund.
  18. Agency enterprise fund:
  a. OGS convention center account (50318).
  19. Agencies internal service fund:
  a. Archives records management account (55052).
  b. Federal single audit account (55053).
  c. Civil service law: sec 11 admin account (55055).
  d. Civil service EHS occupational health program account (55056).
  e. Banking services account (55057).
  f. Cultural resources survey account (55058).
  g. Neighborhood work project (55059).
  h. Automation & printing chargeback account (55060).
  i. OFT NYT account (55061).
  j. Data center account (55062).
  k. Human service telecom account (55063).
  l. Centralized technology services account (55069).
  m. OPWDD copy center account (55065).
  n. Intrusion detection account (55066).
  o. Domestic violence grant account (55067).
  p. Learning management system account (55070).
  q. Tax contact center account.
  r. Human services contact center account.
  s. Labor contact center account.
  20. Miscellaneous special revenue fund:
  a. Statewide planning and research cooperative system account (21902).
  b. OPWDD provider of service account (21903).
  c. New York state thruway authority account (21905).
  d. Mental hygiene patient income account (21909).
  e. Financial control board account (21911).
  f. Regulation of racing account (21912).
  g. New York metropolitan transportation council account (21913).
  h. Cyber upgrade account (21919).
  i. State university dormitory income reimbursable account (21937).
  j. Energy research account (21943).
  k. Criminal justice improvement account (21945).
  l. Fingerprint identification and technology account (21950).
  m. Environmental laboratory reference fee account (21959).
  n. Clinical laboratory reference system assessment account (21962).
  o. Public employment relations board account (21964).
  p. Cable television account (21971).
  q. Indirect cost recovery account (21978).
  r. High school equivalency program account (21979).
  s. Rail safety inspection account (21983).
  t. Multi-agency training account (21989).
  u. Critical infrastructure account (21992).
  v. Bell jar collection account (22003).
  w. Industry and utility service account (22004).

S. 2609--C                         117

  x. Real property disposition account (22006).
  y. Parking account (22007).
  z. Asbestos safety training program account (22009).
  aa. Public service account (22011).
  bb. Batavia school for the blind account (22032).
  cc. Investment services account (22034).
  dd. Surplus property account (22036).
  ee. Financial oversight account (22039).
  ff. Regulation of indian gaming account (22046).
  gg. Rome school for the deaf account (22053).
  hh. Seized assets account (22054).
  ii. Administrative adjudication account (22055).
  jj. Federal salary sharing account (22056).
  kk. New York City assessment account (22062).
  ll. Cultural education account (22063).
  mm. Examination and miscellaneous revenue account (22065).
  nn. Local services account (22078).
  oo. DHCR mortgage servicing account (22085).
  pp. Department of motor vehicles compulsory insurance account (22087).
  qq. Housing indirect cost recovery account (22090).
  rr. DHCR-HCA application fee account (22100).
  ss. Low income housing monitoring account (22130).
  tt. Corporation administration account (22135).
  uu. Montrose veteran's home account (22144).
  vv. Motor fuel quality account (22149).
  ww. Deferred compensation administration account (22151).
  xx. Rent revenue other account (22156).
  yy. Rent revenue account (22158).
  zz. Tax revenue arrearage account (22168).
  aaa. Solid waste management account (22176).
  bbb. Capacity contracting (22016).
  ccc. Point insurance reduction program account.
  ddd. Internet point insurance reduction program account (22094).
  eee. Mental hygiene program fund account (21907).
  fff. Third party debt collection account.
  21. New York State storm recovery capital fund:
  22. State university income fund:
  a. State university general income offset account (22654).
  23. State police and motor vehicle law enforcement fund:
  a. State police motor vehicle law enforcement account (22802).
  24. Youth facilities improvement fund:
  a. Youth facilities improvement account (31701).
  25. Highway safety program fund:
  a. Highway safety program account (23001).
  26. Drinking water program management and administration fund:
  a. EFC drinking water program account (23101).
  b. DOH drinking water program account (23102).
  27. New York city county clerks offset fund:
  a. NYCCC operating offset account (23151).
  28. Housing assistance fund.
  29. Housing program fund.
  30. Department of transportation - engineering services fund:
  a. Highway facility purpose account (31951).
  31. Miscellaneous capital projects fund:
  a. New York racing account (32213).
  32. Mental hygiene facilities capital improvement fund.

S. 2609--C                         118

  33. Joint labor/management administration fund:
  a. Joint labor/management administration fund (55201).
  34. Audit and control revolving fund:
  a. Executive direction internal audit account (55251).
  b. CIO Information technology centralized services account (55252).
  35. Health insurance internal service fund:
  a. Health insurance internal service account (55300).
  b. Civil service employee benefits div admin (55301).
  36. Correctional industries revolving fund.
  37. Correctional facilities capital improvement fund.
  38. HCRA resources fund:
  a. EPIC premium account (20818).
  b. Hospital based grants program account (20812).
  c. Child health plus program account (20810).
  S 1-a. The state comptroller is hereby authorized and directed to loan
money  in  accordance  with the provisions set forth in subdivision 5 of
section 4 of the state finance law to any account within  the  following
federal  funds,  provided  the comptroller has made a determination that
sufficient federal grant award authority is available to reimburse  such
loans:
  1. Federal USDA-food nutrition services fund.
  2. Federal health and human services fund.
  3. Federal education grants fund.
  4. Federal block grant fund.
  5. Federal operating grants fund.
  6. Federal capital projects fund.
  7. Federal unemployment insurance administration fund.
  8. Federal unemployment insurance occupational training fund.
  9. Federal employment and training grants.
  S  2.  Notwithstanding any law to the contrary, and in accordance with
section 4 of the state finance law, the comptroller is hereby authorized
and directed to transfer, upon request of the director of the budget, on
or before March 31, 2014, up to the unencumbered balance or the  follow-
ing amounts:
  Economic Development and Public Authorities:
  1.  $175,000  from  the miscellaneous special revenue fund underground
facilities safety training account (22172), to the general fund.
  2. An amount up to the unencumbered  balance  from  the  miscellaneous
special  revenue  fund, business and licensing services account (21977),
to the general fund.
  3. $14,810,000 from  the  miscellaneous  special  revenue  fund,  code
enforcement account (21904), to the general fund.
  4.  An  amount  up  to the unencumbered balance from the miscellaneous
special revenue fund,  administrative  costs  account  (21974),  to  the
general fund.
  Education:
  1.  $2,242,000,000  from  the  general fund to the state lottery fund,
education account (20901), as reimbursement for disbursements made  from
such  fund for supplemental aid to education pursuant to section 92-c of
the state finance law that are in excess of  the  amounts  deposited  in
such fund for such purposes pursuant to section 1612 of the tax law.
  2.  $901,800,000  from the general fund to the state lottery fund, VLT
education account (20904), as reimbursement for disbursements made  from
such  fund for supplemental aid to education pursuant to section 92-c of
the state finance law that are in excess of  the  amounts  deposited  in
such fund for such purposes pursuant to section 1612 of the tax law.

S. 2609--C                         119

  3.  Moneys  from  the  state lottery fund up to an amount deposited in
such fund pursuant to section 1612 of the  tax  law  in  excess  of  the
current year appropriation for supplemental aid to education pursuant to
section 92-c of the state finance law.
  4.  $300,000  from the local government records management improvement
fund to the archives partnership trust fund.
  5. $900,000 from the general fund to the miscellaneous special revenue
fund, Batavia school for the blind account (22032).
  6. $900,000 from the general fund to the miscellaneous special revenue
fund, Rome school for the deaf account (22053).
  7. $80,000,000 from the state university dormitory income fund to  the
state university residence hall rehabilitation fund.
  8. $343,400,000 from the state university dormitory income fund to the
miscellaneous  special  revenue  fund, state university dormitory income
reimbursable account (21937).
  9. $24,000,000 from any of  the  state  education  department  special
revenue  and internal service funds to the miscellaneous special revenue
fund, indirect cost recovery account (21978).
  10. $8,318,000 from the general fund to the  state  university  income
fund,  state  university  income offset account (22654), for the state's
share of repayment of the STIP loan.
  11. $51,700,000 from the state university income fund, state universi-
ty hospitals income reimbursable account (22656) to the general fund for
hospital debt service for the period April 1,  2013  through  March  31,
2014.
  Environmental Affairs:
  1.  $5,000,000 from the department of transportation's federal capital
projects fund to the office of parks and  recreation  federal  operating
grants fund, miscellaneous operating grants account (25300).
  2.  $16,000,000  from any of the department of environmental conserva-
tion's special revenue federal funds to the special revenue fund federal
grant indirect cost recovery account (22188).
  3. $2,000,000 from any of the department  of  environmental  conserva-
tion's  special revenue federal funds to the conservation fund as neces-
sary to avoid diversion of conservation funds.
  4. $15,000,000 from the environmental protection  fund,  environmental
protection transfer account (30451) to the general fund.
  5. $3,000,000 from any of the office of parks, recreation and historic
preservation  capital projects federal funds and special revenue federal
funds to the special revenue fund federal grant indirect  cost  recovery
account (22188).
  6. $1,000,000 from any of the office of parks, recreation and historic
preservation  special revenue federal funds to the special revenue fund,
I love NY water account (21930).
  Family Assistance:
  1. $10,000,000 from any of the office of children and family services,
office of temporary and disability assistance, or department  of  health
special  revenue  federal funds and the general fund, in accordance with
agreements with social services districts, to the miscellaneous  special
revenue  fund, office of human resources development state match account
(21967).
  2. $3,000,000 from any of the office of children and  family  services
or office of temporary and disability assistance special revenue federal
funds to the miscellaneous special revenue fund, family preservation and
support services and family violence services account (22082).

S. 2609--C                         120

  3.  $6,000,000  from any of the office of children and family services
special revenue federal  funds  to  the  general  fund  for  title  IV-E
reimbursement of youth facility costs.
  4. $12,670,000 from any of the office of children and family services,
office  of  temporary and disability assistance, or department of health
special revenue federal  funds  and  any  other  miscellaneous  revenues
generated  from  the operation of office of children and family services
programs to the general fund.
  5. $10,000,000 from any of the office of children and family  services
or  office  of temporary and disability assistance special revenue funds
or  the  general  fund  to  the  miscellaneous  special  revenue   fund,
connections account (22180).
  6.  $41,000,000  from  any  of  the office of temporary and disability
assistance accounts within the federal health and human services fund to
the general fund.
  7. $159,000,000 from any of the office  of  temporary  and  disability
assistance  or department of health special revenue funds to the general
fund.
  8. $2,500,000 from any of  the  office  of  temporary  and  disability
assistance  or  office  of  children and family services special revenue
federal funds to the  miscellaneous  special  revenue  fund,  office  of
temporary and disability assistance program account (21980).
  9. $50,000,000 from any of the office of children and family services,
office  of temporary and disability assistance, department of labor, and
department of health special revenue federal  funds  to  the  office  of
children  and family services miscellaneous special revenue fund, multi-
agency training contract account (21989).
  10. $152,400,000 from the miscellaneous special  revenue  fund,  youth
facility per Diem account (22186), to the general fund.
  11.  $621,850 from the general fund to the combined gifts, grants, and
bequests fund, WB Hoyt Memorial account (20128).
  12. $4,822,000 from  the  miscellaneous  special  revenue  fund  state
central registry (22028) to the general fund.
  General Government:
  1. $1,566,000 from the miscellaneous special revenue fund, examination
and miscellaneous revenue account (22065) to the general fund.
  2. $12,500,000 from the general fund to the health insurance revolving
fund.
  3. $192,400,000 from the health insurance reserve receipts fund to the
general fund.
  4. $150,000 from the general fund to the not-for-profit revolving loan
fund.
  5. $150,000 from the not-for-profit revolving loan fund to the general
fund.
  6. $31,000,000 from the miscellaneous special revenue fund, real prop-
erty disposition account (22006), to the general fund.
  7.  $3,000,000  from  the  miscellaneous special revenue fund, surplus
property account (22036), to the general fund.
  8. $18,200,000 from the general  fund  to  the  miscellaneous  special
revenue fund, alcoholic beverage control account (22033).
  9.  $23,000,000  from  the miscellaneous special revenue fund, revenue
arrearage account (22024), to the general fund.
  10. $1,826,000 from the miscellaneous  special  revenue  fund  revenue
arrearage  account  (22024),  to  the miscellaneous special revenue fund
authority budget office account (22138).

S. 2609--C                         121

  11. $1,000,000 from the miscellaneous special  revenue  fund,  parking
services  account (22007), to the general fund, for the purpose of reim-
bursing the costs of debt service related to state parking facilities.
  Health:
  1.  $139,560,000  from the miscellaneous special revenue fund, quality
of care account (21915) to the general fund.
  2. $1,000,000 from the general fund to the combined gifts, grants  and
bequests  fund, breast cancer research and education account (20155), an
amount equal to the monies collected and deposited into that account  in
the previous fiscal year.
  3. $2,464,000 from any of the department of health accounts within the
federal  health  and  human  services  fund  to the department of health
miscellaneous special revenue  fund,  statewide  planning  and  research
cooperation system (SPARCS) program account (21902).
  4.  $250,000  from  the general fund to the combined gifts, grants and
bequests  fund,  prostate  cancer  research,  detection,  and  education
account  (20183),  an amount equal to the moneys collected and deposited
into that account in the previous fiscal year.
  5. $500,000 from the general fund to the combined  gifts,  grants  and
bequests  fund,  Alzheimer's  disease  research  and  assistance account
(20143), an amount equal to the moneys collected and deposited into that
account in the previous fiscal year.
  6. $1,000,000 from the miscellaneous special  revenue  fund,  adminis-
tration account (21982), to the general fund.
  7.  $600,000,000  from any of the department of health accounts within
the federal health and human services fund to the miscellaneous  special
revenue fund, federal state health reform partnership account (22076).
  8.  $26,000,000 from the special revenue fund, HCRA resources fund, to
the miscellaneous special revenue fund, empire  state  stem  cell  trust
fund account (22161).
  9.  $1,250,000  from  the  miscellaneous  New  York state agency fund,
medical assistance account to the general fund.
  10. $3,700,000 from the miscellaneous  New  York  state  agency  fund,
medical assistance account to the general fund.
  11.  $14,000,000  from  the  general fund to the miscellaneous special
revenue fund, empire state stem cell trust fund (22161).
  12. $139,560,000 from any of the department of health accounts  within
the  federal health and human services fund to the miscellaneous special
revenue fund, quality of care account (21915).
  Labor:
  1. $700,000 from the labor  standards  miscellaneous  special  revenue
fund, fee and penalty account (21923), to the child performer protection
fund, child performer protection account (20401).
  2.  $8,400,000  from the labor standards miscellaneous special revenue
fund, fee and penalty account (21923), to the general fund.
  3. $3,300,000 from the unemployment  insurance  interest  and  penalty
special revenue fund, unemployment insurance special interest and penal-
ty account (23601), to the general fund.
  4.  $3,000,000  from the labor standards miscellaneous special revenue
fund, public work enforcement account (21998), to the general fund.
  5. $2,200,000 from the training and education program on  occupational
safety  and  health  fund,  occupational  safety  and  health inspection
account (21252), to the general fund.
  6. $900,000 from the training and education  program  on  occupational
safety  and  health fund, training and education account (21251), to the
general fund.

S. 2609--C                         122

  Mental Hygiene:
  1.  $10,000,000  from  the  miscellaneous special revenue fund, mental
hygiene patient income account (21909),  to  the  miscellaneous  special
revenue fund, federal salary sharing account (22056).
  2.  $150,000,000  from  the miscellaneous special revenue fund, mental
hygiene patient income account  (21909)  to  the  miscellaneous  special
revenue fund, provider of service accounts (21903).
  3.  $150,000,000  from  the miscellaneous special revenue fund, mental
hygiene program fund account (21907) to the miscellaneous special reven-
ue fund, provider of service account (21903).
  4. $150,000,000 from the general fund  to  the  miscellaneous  special
revenue fund, mental hygiene patient income account (21909).
  5.  $300,000,000  from  the  general fund to the miscellaneous special
revenue fund, mental hygiene program fund account (21907).
  6. $171,995,000 from the miscellaneous special  revenue  fund,  mental
hygiene program fund account (21907) to the general fund.
  7.  $146,763,000  from  the miscellaneous special revenue fund, mental
hygiene patient income account (21909) to the general fund.
  Public Protection:
  1. $1,350,000 from the miscellaneous special revenue  fund,  emergency
management account (21944), to the general fund.
  2.  $3,300,000  from  the  general  fund  to the miscellaneous special
revenue fund, recruitment incentive account (22171).
  3. $9,500,000 from the general fund  to  the  correctional  industries
revolving   fund,   correctional  industries  internal  service  account
(55350).
  4. $10,000,000 from federal miscellaneous operating grants fund,  DMNA
damage account (25324), to the general fund.
  5.  $16,000,000  from  the  general  fund to the miscellaneous special
revenue fund, crimes against revenue program account (22015).
  6. $20,000,000 from any office of homeland security account within the
federal miscellaneous operating grants fund, receiving money through the
homeland security grants program, to the general fund.
  7. $22,000,000 from the miscellaneous special revenue  fund,  criminal
justice improvement account (21945) to the general fund.
  8.  $58,000,000 from the miscellaneous special revenue fund, statewide
public safety communications account (22123), to the general fund.
  9. $106,000,000 from the state police and motor vehicle  law  enforce-
ment  and  motor vehicle theft and insurance fund prevention fund, state
police motor vehicle enforcement account (22802) to the general fund for
state operation expenses of the division of state police.
  10. $21,500,000 from the general fund to the  correctional  facilities
capital improvement fund.
  11.  $1,500,000 from the miscellaneous special revenue fund, statewide
public safety communications account (22123),  to  the  combined  gifts,
grants  and  bequests  fund, New York state emergency services revolving
loan account (20150).
  12. $3,000,000 from the general fund  to  the  dedicated  highway  and
bridge  trust  fund  for  the  purpose  of  work  zone safety activities
provided by the division of state police for the department of transpor-
tation.
  13. Up to $6,600,000 from the legal services assistance  fund  to  the
general fund.
  14.  Up  to  $77,000,000  from the indigent legal services fund to the
general fund.
  Transportation:

S. 2609--C                         123

  1. $17,672,000 from the federal miscellaneous operating grants fund to
the special revenue fund, tri-state federal  regional  planning  account
(21913).
  2.  $20,147,000  from the federal capital projects fund to the special
revenue fund, tri-state federal regional planning accounts (21913).
  3. $15,368,000 from the miscellaneous special revenue fund, compulsory
insurance account (22087), to the general fund.
  4. $12,000,000 from the general fund to the mass transportation  oper-
ating  assistance  fund, public transportation systems operating assist-
ance account (21401).
  5. $624,691,000 from the general fund to  the  dedicated  highway  and
bridge trust fund.
  6.  $606,000  from  the  miscellaneous  special revenue fund, internet
point insurance reduction program account (22094), to the general fund.
  7. $6,000 from the  miscellaneous  special  revenue  fund,  motorcycle
safety account (21976), to the general fund.
  8.  $307,200,000 from the general fund to the MTA financial assistance
fund, mobility tax trust account (23651).
  Miscellaneous:
  1. $150,000,000 from the general fund to any funds or accounts for the
purpose of reimbursing certain outstanding accounts receivable balances.
  2. $450,000,000 from the storm recovery capital fund  to  the  revenue
bond tax fund (40152).
  3.  $1,000,000  from  any  of  the  state  lottery fund administration
accounts, the miscellaneous special revenue fund, regulation  of  racing
account  (21912),  the  miscellaneous  special  revenue  fund,  bell jar
collection account (22003), or the miscellaneous special  revenue  fund,
regulation  of  Indian  gaming  account  (22046),  to  the miscellaneous
special revenue fund, New York state gaming commission account.
  S 3. Notwithstanding any law to the contrary, and in  accordance  with
section 4 of the state finance law, the comptroller is hereby authorized
and directed to transfer, on or before March 31, 2014:
  1.  Upon request of the commissioner of environmental conservation, up
to $11,126,800 from revenues credited to any of the department of  envi-
ronmental  conservation special revenue funds, including $3,253,200 from
the environmental  protection  and  oil  spill  compensation  fund,  and
$1,762,600 from the conservation fund, to the environmental conservation
special revenue fund, indirect charges account (21060).
  2.  Upon request of the commissioner of agriculture and markets, up to
$3,000,000 from any special revenue fund or enterprise fund  within  the
department of agriculture and markets to the general fund, to pay appro-
priate administrative expenses.
  3.  Upon request of the commissioner of agriculture and markets, up to
$2,000,000 from the state exposition special fund, state  fair  receipts
account  (50051)  to the miscellaneous capital projects fund, state fair
capital improvement account (32208).
  4. Upon request of the commissioner of the  division  of  housing  and
community  renewal, up to $6,221,000 from revenues credited to any divi-
sion of housing and community renewal federal or  miscellaneous  special
revenue fund to the agency cost recovery account (22090).
  5.  Upon  request  of  the commissioner of the division of housing and
community renewal, up to $5,500,000 may be transferred from any  miscel-
laneous  special  revenue  fund  account,  to  any miscellaneous special
revenue fund.
  6. Upon request of the commissioner of health up to  $15,000,000  from
revenues  credited  to any of the department of health's special revenue

S. 2609--C                         124

funds, to the miscellaneous special revenue fund, administration account
(21982).
  S  4.  Notwithstanding  section  2815  of the public health law or any
other contrary provision of law, upon the direction of the  director  of
the  budget  and  the commissioner of health, the dormitory authority of
the state of New York is directed  to  transfer  seven  million  dollars
annually  from  funds  available  and  uncommitted in the New York state
health care restructuring pool to the  health  care  reform  act  (HCRA)
resources fund - HCRA resources account.
  S 5. On or before March 31, 2014, the comptroller is hereby authorized
and  directed  to  deposit  earnings  that would otherwise accrue to the
general fund that are attributable to the operation of section  98-a  of
the  state  finance  law, to the agencies internal service fund, banking
services account (55057), for the purpose  of  meeting  direct  payments
from such account.
  S  6.  Notwithstanding  any law to the contrary, upon the direction of
the director of the budget and upon requisition by the state  university
of  New  York,  the  dormitory  authority  of  the  state of New York is
directed to transfer, up to $22,000,000 in revenues generated  from  the
sale  of  notes  or  bonds,  to  the  state  university  of New York for
reimbursement of bondable equipment for further transfer to the  state's
general fund.
  S  7.  Notwithstanding any law to the contrary, and in accordance with
section 4 of the state finance law, the comptroller is hereby authorized
and directed to transfer, upon request of the director of the budget and
upon consultation with the state university chancellor  or  his  or  her
designee,  on or before March 31, 2014, up to $16,000,000 from the state
university income fund general revenue  account  (22653)  to  the  state
general  fund for debt service costs related to campus supported capital
project costs for the  NY-SUNY  2020  challenge  grant  program  at  the
University at Buffalo.
  S  8.  Notwithstanding any law to the contrary, and in accordance with
section 4 of the state finance law, the comptroller is hereby authorized
and directed to transfer, upon request of the director of the budget and
upon consultation with the state university chancellor  or  his  or  her
designee,  on  or before March 31, 2014, up to $6,500,000 from the state
university income fund general revenue  account  (22653)  to  the  state
general  fund for debt service costs related to campus supported capital
project costs for the  NY-SUNY  2020  challenge  grant  program  at  the
University at Albany.
  S  9.  Notwithstanding  any  law to the contrary, the state university
chancellor or her designee is authorized and directed to transfer  esti-
mated tuition revenue balances from the state university collection fund
to  the  state  university fund, state university general revenue offset
account (22655) on or before March 31, 2014.
  S 10. Notwithstanding any law to the contrary, and in accordance  with
section 4 of the state finance law, the comptroller is hereby authorized
and directed to transfer, upon request of the director of the budget, up
to  $87,756,000  from  the  general  fund to the state university income
fund, state university hospitals  income  reimbursable  account  (22656)
during  the period July 1, 2013 through June 30, 2014 to reflect ongoing
state subsidy of SUNY hospitals and to pay  costs  attributable  to  the
SUNY hospitals' state agency status.
  S  11. Notwithstanding any law to the contrary, and in accordance with
section 4 of the state finance law, the comptroller is hereby authorized
and directed to transfer, upon request of the director of the budget, up

S. 2609--C                         125

to $969,050,300 from the general fund to  the  state  university  income
fund, state university general revenue offset account (22655) during the
period  of  July  1, 2013 through June 30, 2014 to support operations at
the state university.
  S  12. Notwithstanding any law to the contrary, and in accordance with
section 4 of the state finance law, the comptroller is hereby authorized
and directed to transfer, upon request of the state university  chancel-
lor  or his or her designee, up to $50,000,000 from the state university
income fund, state  university  hospitals  income  reimbursable  account
(22656),  for  hospital income reimbursable for services and expenses of
hospital operations and capital expenditures  at  the  state  university
hospitals,  and  the  state university income fund Long Island veterans'
home account (22652) to the state university capital projects fund on or
before June 30, 2014.
  S 13. Notwithstanding any law to the contrary, and in accordance  with
section  4 of the state finance law, the comptroller, after consultation
with the state university chancellor or his or her designee,  is  hereby
authorized  and directed to transfer moneys, in the first instance, from
the state university collection fund, Stony  Brook  hospital  collection
account (61006), Brooklyn hospital collection account (61007), and Syra-
cuse  hospital collection account (61008) to the state university income
fund, state university hospitals income reimbursable account (22656)  in
the  event  insufficient  funds  are  available  in the state university
income fund, state  university  hospitals  income  reimbursable  account
(22656)  to  transfer  moneys,  in amounts sufficient to permit the full
transfer of moneys authorized for transfer,  to  the  general  fund  for
payment  of debt service related to the SUNY hospitals.  Notwithstanding
any law to the contrary, the comptroller is also hereby  authorized  and
directed, after consultation with the state university chancellor or his
or  her  designee,  to  transfer moneys from the state university income
fund to the state university income  fund,  state  university  hospitals
income  reimbursable account (22656) in the event insufficient funds are
available in the state university income fund, state  university  hospi-
tals income reimbursable account (22656) to pay hospital operating costs
or to transfer moneys, in amounts sufficient to permit the full transfer
of  moneys  authorized  for transfer, to the general fund for payment of
debt service related to the SUNY hospitals on or before March 31, 2014.
  S 14. Notwithstanding any law to the contrary, and in accordance  with
section 4 of the state finance law, the comptroller is hereby authorized
and  directed  to  transfer  monies, upon request of the director of the
budget, on or before March 31, 2014, from and to any  of  the  following
accounts: the miscellaneous special revenue fund, patient income account
(21909),  the miscellaneous special revenue fund, mental hygiene program
fund account (21907), the miscellaneous special  revenue  fund,  federal
salary  sharing  account (22056) or the general fund in any combination,
the aggregate of which shall not exceed $350 million.
  S 15. Intentionally omitted.
  S 16. Intentionally omitted.
  S 17. Intentionally omitted.
  S 18. $5,000,000 from the general fund to  the  miscellaneous  special
revenue  fund,  tribal  state compact revenue account (22169).  Notwith-
standing any provision of  law  to  the  contrary,  such  funds  may  be
advanced  to  a  municipality  located  within the county of Cattaraugus
hosting a gaming facility pursuant to the requirements of  an  appropri-
ation  contained  in  chapter 53 of the laws of 2012; provided, however,
that any such advance shall reduce the  amount  otherwise  due  to  such

S. 2609--C                         126

municipality  by  an  equivalent  amount,  and that, upon receipt of any
funds in the tribal state compact revenue account pursuant to  a  tribal
state  compact, such funds shall first be used to reimburse any transfer
from the general fund pursuant to this section.
  S 19. Section 53 of part U of chapter 59 of the laws of 2012, relating
to providing for administration of certain funds and accounts related to
the 2013-2014 budget, is amended to read as follows:
  S  53.  This  act shall take effect immediately and shall be deemed to
have been in full force and effect on and after April 1, 2012;  provided
that  sections one through seven, sections ten through fifteen, [section
seventeen,] and sections twenty through thirty-three of this  act  shall
expire  March  31,  2013,  when  upon  such date, the provisions of such
sections shall be deemed repealed; provided further that the  amendments
to subdivisions 1 and 2 of section 45 of section 1 of chapter 174 of the
laws of 1968 made by section forty-nine of this act shall not affect the
expiration of such subdivisions and shall be deemed to expire therewith.
  S  20.  Subdivision  5  of section 97-rrr of the state finance law, as
amended by section 16 of part U of chapter 59 of the laws  of  2012,  is
amended to read as follows:
  5. Notwithstanding the provisions of section one hundred seventy-one-a
of  the  tax law, as separately amended by chapters four hundred eighty-
one and four hundred eighty-four of the laws of nineteen hundred  eight-
y-one,  and notwithstanding the provisions of chapter ninety-four of the
laws of two thousand eleven, or any  other  provisions  of  law  to  the
contrary,  during  the  fiscal  year beginning April first, two thousand
[twelve] THIRTEEN,  the  state  comptroller  is  hereby  authorized  and
directed  to  deposit  to the fund created pursuant to this section from
amounts collected pursuant to article twenty-two  of  the  tax  law  and
pursuant  to  a  schedule submitted by the director of the budget, up to
[$3,322,067,000] $3,419,375,000, as may be certified in such schedule as
necessary to meet the purposes of such fund for the fiscal  year  begin-
ning April first, two thousand [twelve] THIRTEEN.
  S  21.  The  comptroller  is authorized and directed to deposit to the
general fund-state purposes account reimbursements from moneys appropri-
ated or reappropriated to the correctional facilities  capital  improve-
ment  fund  by  a  chapter  of the laws of 2013. Reimbursements shall be
available for spending from appropriations made  to  the  department  of
corrections and community supervision in the general fund-state purposes
accounts  by a chapter of the laws of 2013 for costs associated with the
administration and security of capital  projects  and  for  other  costs
which are attributable, according to a plan, to such capital projects.
  S  22. Section 3 of part W of chapter 60 of the laws of 2011, amending
the state finance law relating to disbursements  from  the  tribal-state
compact revenue account to certain municipalities, is amended to read as
follows:
  S 3. This act shall take effect immediately; provided that:
  (a)  the  amendments  to  subdivision  3  of section 99-h of the state
finance law made by section one of this act shall expire and  be  deemed
repealed [March 31, 2013] DECEMBER 31, 2016; and
  (b)  the  amendments to paragraph (a) of subdivision 4 of section 99-h
of the state finance law made by section  two  of  this  act  shall  not
affect  the  expiration  of  such  section and shall be deemed to expire
therewith.
  S 23. Subdivision 3 of section 99-h  of  the  state  finance  law,  as
amended  by  section  1  of part V of chapter 59 of the laws of 2006, is
amended to read as follows:

S. 2609--C                         127

  3. Moneys of the account, following [appropriation] THE SEGREGATION OF
APPROPRIATIONS ENACTED  by  the  legislature,  shall  be  available  for
purposes including but not limited to: (a) reimbursements or payments to
municipal  governments  that  host  tribal casinos pursuant to a tribal-
state compact for costs incurred in connection with services provided to
such  casinos  or  arising as a result thereof, for economic development
opportunities and job expansion programs  authorized  by  the  executive
law;  provided,  however,  that  for  any gaming facility located in the
county of Erie or Niagara, the municipal governments hosting the facili-
ty shall collectively receive a minimum of twenty-five  percent  of  the
negotiated percentage of the net drop from electronic gaming devices the
state receives pursuant to the compact and provided further that for any
gaming  facility located in the county or counties of Cattaraugus, Chau-
tauqua or Allegany, the municipal governments of the state  hosting  the
facility  shall collectively receive a minimum of twenty-five percent of
the negotiated percentage of the net drop from electronic gaming devices
the state receives pursuant to the compact; and  provided  further  that
pursuant  to  chapter  five  hundred  ninety of the laws of two thousand
four, a minimum of twenty-five percent of the revenues received  by  the
state  pursuant  to  the state's compact with the St. Regis Mohawk tribe
shall be made available to the counties of Franklin  and  St.  Lawrence,
and  affected  towns in such counties. Each such county and its affected
towns shall receive fifty percent of the moneys made  available  by  the
state;  and  (b)  support and services of treatment programs for persons
suffering from gambling addictions. Moneys not [appropriated] SEGREGATED
for such purposes shall be transferred  to  the  general  fund  for  the
support of government during the fiscal year in which they are received.
  S  24.  Paragraphs  (a)  and  (b)  of  subdivision 7 of section 5-a of
section 1 of chapter 392 of the laws of 1973, constituting the New  York
state  medical  care  facilities  finance  agency  act, paragraph (a) as
amended by chapter 55 of the laws of 1992 and paragraph (b)  as  amended
by chapter 59 of the laws of 1993, are amended to read as follows:
  (a)  In  connection with the making of federally-aided mortgage loans,
the commissioner of health shall  charge  to  such  non-profit  hospital
corporation,  non-profit corporation providing a residential health care
facility or non-profit medical corporation, for mortgage closings on  or
after April first, nineteen hundred eighty-nine, a fee of nine-tenths of
one percent of the mortgage loan, payable on requisition on or after the
mortgage  closing to the state department of health by the mortgagor for
deposit into the [miscellaneous special revenue fund - 339 hospital  and
nursing home management account] STATE GENERAL FUND.
  (b) In connection with the refinancing or refunding of federally-aided
mortgage  loans  or  loans  made pursuant to articles twenty-eight-A and
twenty-eight-B of the public health  law,  the  commissioner  of  health
shall  charge to such non-profit hospital corporation, non-profit corpo-
ration providing  a  residential  health  care  facility  or  non-profit
medical  corporation,  for  mortgage  closings  on or after April first,
nineteen hundred eighty-nine, a fee of five-tenths of one percent of the
new mortgage loan, payable on requisition on or after the mortgage clos-
ing to the state department of health by the mortgagor for deposit  into
the  [miscellaneous  special  revenue fund-339 hospital and nursing home
management account] STATE GENERAL FUND.
  S 25. The New York State energy research and development authority  is
authorized  and  directed  to pay to the state treasury to the credit of
the general fund the amount of $65,000,000 for the fiscal year  commenc-
ing  April  1,  2013  from  proceeds collected by the authority from the

S. 2609--C                         128

auction or sale of carbon dioxide emission allowances allocated  by  the
department  of  environmental conservation under the Regional Greenhouse
Gas Initiative.
  S  26.  Notwithstanding  any  other  law,  rule,  or regulation to the
contrary, the comptroller is hereby authorized and directed to  deposit,
to  the  credit  of  the  capital  projects fund, reimbursement from the
proceeds of notes or bonds issued by  the  dormitory  authority  of  the
state  of  New York for a capital appropriation for $215,650,000 author-
ized by chapter 55 of the laws of 2000 to all state agencies for payment
of costs related to the strategic investment program.
  S 27. Notwithstanding any  other  law,  rule,  or  regulation  to  the
contrary,  the  comptroller is hereby authorized and directed to deposit
to the credit of the  capital  projects  fund,  reimbursement  from  the
proceeds of notes or bonds issued by the environmental facilities corpo-
ration  for a capital appropriation of $30,174,000 authorized by chapter
55 of the laws of 2003 to the department of  environmental  conservation
for payment of a portion of the state's match for federal capitalization
grants  for  the water pollution control revolving loan fund, reimburse-
ment from the proceeds of notes or bonds issued by the urban development
corporation or other financing source for  a  capital  appropriation  of
$19,500,000  authorized  by chapter 50 of the laws of 2003 to the office
of general services for payment of capital construction costs for the 51
Elk street parking garage  building  located  in  the  city  of  Albany,
reimbursement  from  the  proceeds of notes or bonds issued by the urban
development corporation for disbursements of up to $10,000,000 from  any
capital appropriation or reappropriation authorized by chapter 50 of the
laws  of  2003  to  the office of general services for various purposes,
reimbursement from the proceeds of notes or bonds issued by the environ-
mental facilities corporation for a capital appropriation of $13,250,000
authorized by chapter 55 of the laws of 2003 to the energy research  and
development authority for the Western New York Nuclear Service Center at
West Valley, reimbursement from the proceeds of notes or bonds issued by
the  dormitory authority for disbursements of up to $16,400,000 from any
capital appropriation or reappropriation authorized by chapter 51 of the
laws of 2003 to the judiciary for courthouse improvements, reimbursement
from the proceeds of notes or bonds  issued  by  the  urban  development
corporation  for  disbursements of up to $10,000,000 from appropriations
or reappropriations authorized by chapter 50 of the laws of 2003 to  any
agency  for  costs  related to homeland security, reimbursement from the
proceeds of notes or bonds issued by the environmental facilities corpo-
ration for a capital appropriation of $10,000,000 authorized by  chapter
55  of  the laws of 2003 to the department of environmental conservation
for Onondaga lake, reimbursement from the proceeds  of  notes  or  bonds
issued  by the environmental facilities corporation for disbursements of
up to $11,000,000 from any capital  appropriations  or  reappropriations
authorized  by chapter 55 of the laws of 2003 to the department of envi-
ronmental conservation for  environmental  purposes,  and  reimbursement
from  the  proceeds  of notes or bonds issued by the dormitory authority
for disbursements of up to $100,000,000  from  a  capital  appropriation
authorized  by chapter 50 of the laws of 2003 to the department of state
for enhanced 911 wireless service.
  S 28. Notwithstanding any  other  law,  rule,  or  regulation  to  the
contrary,  the  comptroller is hereby authorized and directed to deposit
to the credit of the  capital  projects  fund,  reimbursement  from  the
proceeds of notes or bonds issued by the environmental facilities corpo-
ration for a capital appropriation for $28,893,000 authorized by chapter

S. 2609--C                         129

55  of  the laws of 2004 to the department of environmental conservation
for payment of a portion of the state's match for federal capitalization
grants for the water pollution control revolving loan  fund,  reimburse-
ment from the proceeds of notes or bonds issued by the urban development
corporation  for  disbursements  of  up  to $10,000,000 from any capital
appropriation or reappropriation authorized by chapter 50 of the laws of
2004 to the office of general services for various purposes,  reimburse-
ment  from  the  proceeds  of notes or bonds issued by the environmental
facilities  corporation  for  a  capital  appropriation  of  $11,350,000
authorized  by chapter 55 of the laws of 2004 to the energy research and
development authority for the Western New York Nuclear Service Center at
West Valley, reimbursement from the proceeds of notes or bonds issued by
the environmental facilities corporation, for a capital appropriation of
$10,000,000 authorized by chapter 55 of the laws of 2004 to the  depart-
ment of environmental conservation for Onondaga lake, reimbursement from
the  proceeds  of  notes or bonds issued by the environmental facilities
corporation for disbursements of up  to  $11,000,000  from  any  capital
appropriations  or reappropriations authorized by chapter 55 of the laws
of 2004 to the department of  environmental  conservation  for  environ-
mental  purposes,  reimbursement  from  the  proceeds  of notes or bonds
issued by  the  dormitory  authority  for  a  capital  appropriation  of
$80,000,000  authorized  by chapter 53 of the laws of 2004 to the educa-
tion  department  for  capital  transition  grants  for  transportation,
reimbursement from the proceeds of notes or bonds issued by the dormito-
ry  authority  for a capital appropriation of $243,325,000 authorized by
chapter 55 of the laws of 2004 for payment of costs related to  economic
development  projects, reimbursement from the proceeds of bonds or notes
issued by the urban development corporation for a capital  appropriation
of  $83,500,000 authorized by chapter 53 of the laws of 2006, as amended
by chapter 108 of the laws of 2006, for payment of costs related to  the
H.  H. Richardson complex and the Darwin Martin House, and reimbursement
from the proceeds of notes or bonds issued by  the  dormitory  authority
for  a  capital appropriation of $345,750,000 authorized by chapter 3 of
the laws of 2004 for the New York state economic development program.
  S 29. Notwithstanding any  other  law,  rule,  or  regulation  to  the
contrary,  the  comptroller is hereby authorized and directed to deposit
to the credit of the  capital  projects  fund,  reimbursement  from  the
proceeds of notes or bonds issued by the environmental facilities corpo-
ration  for a capital appropriation of $29,602,000 authorized by chapter
55 of the laws of 2005 to the department of  environmental  conservation
for payment of a portion of the state's match for federal capitalization
grants  for  the water pollution control revolving loan fund, reimburse-
ment from the proceeds of notes or bonds issued by the urban development
corporation for disbursements of up  to  $10,000,000  from  any  capital
appropriation or reappropriation authorized by chapter 50 of the laws of
2005  to the office of general services for various purposes, reimburse-
ment from the proceeds of notes or bonds  issued  by  the  environmental
facilities  corporation  for  a  capital  appropriation  of  $11,350,000
authorized by chapter 55 of the laws of 2005 to the energy research  and
development authority for the Western New York Nuclear Service Center at
West Valley, reimbursement from the proceeds of notes or bonds issued by
the  environmental facilities corporation for a capital appropriation of
$10,000,000 authorized by chapter 55 of the laws of 2005 to the  depart-
ment of environmental conservation for Onondaga lake, reimbursement from
the  proceeds  of  notes or bonds issued by the environmental facilities
corporation for disbursements of up  to  $11,000,000  from  any  capital

S. 2609--C                         130

appropriations  or reappropriations authorized by chapter 55 of the laws
of 2005 to the department of  environmental  conservation  for  environ-
mental  purposes,  reimbursement  from  the  proceeds  of notes or bonds
issued  by the urban development corporation for a capital appropriation
of $350,000,000 authorized by chapter 55 of the laws  of  2005  for  the
Javits  center, reimbursement from the proceeds of notes or bonds issued
by the dormitory authority for a capital  appropriation  of  $89,750,000
authorized  by  chapter 62 of the laws of 2005 for regional development,
reimbursement from the proceeds of notes or bonds issued by the dormito-
ry authority for a capital appropriation of $249,000,000  authorized  by
chapter  62  of  the  laws  of  2005  for  technology  and  development,
reimbursement from the proceeds of notes or bonds issued  by  the  urban
development  corporation  for  a  capital  appropriation  of $48,517,000
authorized by chapter 162 of the laws of 2005 for  the  New  York  state
economic  development  program, reimbursement from the proceeds of notes
or bonds issued by the  urban  development  corporation  for  a  capital
appropriation  of  $150,000,000  authorized by chapter 62 of the laws of
2005  for  the  higher  education  facilities  capital  matching  grants
program, reimbursement from the proceeds of notes or bonds issued by the
dormitory  authority  or  other financing source for a capital appropri-
ation of $4,000,000 authorized by chapter 50 of the laws of 2005 to  the
office of general services for payment of capital construction costs for
the  Elk  street  parking garage building located in the city of Albany,
reimbursement from the proceeds of notes or bonds issued  by  the  urban
development  corporation  for  a  capital  appropriation  of $15,000,000
authorized by chapter 53 of the laws of  2005  to  the  state  education
department  for  payment of capital construction costs for public broad-
casting facilities, reimbursement from the proceeds of  notes  or  bonds
issued  by the urban development corporation for a capital appropriation
of $15,700,000 authorized by chapter 50 of the laws of 2005 to the divi-
sion of state police for public protection facilities, and reimbursement
from the proceeds of notes or bonds  issued  by  the  urban  development
corporation for capital disbursements of up to $3,000,000 from any capi-
tal  appropriation  or  reappropriation  authorized by chapter 50 of the
laws of 2005 to the division of military and naval affairs  for  various
purposes.
  S  30.  Notwithstanding  any  other  law,  rule,  or regulation to the
contrary, the comptroller is hereby authorized and directed  to  deposit
to  the  credit  of  the  capital  projects fund, reimbursement from the
proceeds of notes or bonds issued by the environmental facilities corpo-
ration for a capital appropriation for $29,600,000 authorized by chapter
55 of the laws of 2006 to the department of  environmental  conservation
for payment of a portion of the state's match for federal capitalization
grants  for  the water pollution control revolving loan fund, reimburse-
ment from the proceeds of notes or bonds issued by the urban development
corporation for disbursements of up  to  $20,000,000  from  any  capital
appropriation or reappropriation authorized by chapter 50 of the laws of
2006  to the office of general services for various purposes, reimburse-
ment from the proceeds of notes or bonds  issued  by  the  environmental
facilities  corporation  for  a  capital  appropriation  of  $14,000,000
authorized by chapter 55 of the laws of 2006 to the energy research  and
development authority for the Western New York Nuclear Service Center at
West Valley, reimbursement from the proceeds of notes or bonds issued by
the  environmental facilities corporation for a capital appropriation of
$10,000,000 authorized by chapter 55 of the laws of 2006 to the  depart-
ment of environmental conservation for Onondaga lake, reimbursement from

S. 2609--C                         131

the  proceeds  of  notes or bonds issued by the environmental facilities
corporation for disbursements of up  to  $12,000,000  from  any  capital
appropriations  or reappropriations authorized by chapter 55 of the laws
of  2006  to  the  department of environmental conservation for environ-
mental purposes, reimbursement from  the  proceeds  of  notes  or  bonds
issued by the urban development corporation for capital disbursements of
up  to  $3,000,000  from  any  capital  appropriation or reappropriation
authorized by chapter 50 of the laws of 2006 to the division of military
and naval affairs for various purposes, reimbursement from the  proceeds
of  notes  or  bonds  issued  by  the  urban development corporation for
disbursements of up to $12,400,000 from  any  capital  appropriation  or
reappropriation  authorized  by  chapter  50  of the laws of 2006 to the
division of state police for public protection facilities, reimbursement
from the proceeds of notes or bonds  issued  by  the  urban  development
corporation  for  a  capital appropriation of $117,000,000 authorized by
chapter 50 of the laws of 2006 to all state departments and agencies for
the purchase of equipment, reimbursement from the proceeds of  notes  or
bonds  issued by the dormitory authority or the urban development corpo-
ration for all or a portion of capital  appropriations  of  $603,050,000
authorized  by  chapter 108 of the laws of 2006 to the urban development
corporation for economic development/other projects, reimbursement  from
the  proceeds  of  notes or bonds issued by the urban development corpo-
ration for a capital appropriation of $269,500,000 authorized by chapter
108 of the laws of 2006 to the dormitory authority or the urban develop-
ment corporation for economic development projects,  reimbursement  from
the  proceeds of notes or bonds issued by the dormitory authority or the
urban  development  corporation   for   a   capital   appropriation   of
$201,500,000  authorized by chapter 108 of the laws of 2006 to the urban
development corporation for university development projects,  reimburse-
ment from the proceeds of notes or bonds issued by the dormitory author-
ity or for a capital appropriation of $143,000,000 authorized by chapter
108  of  the  laws  of  2006  to  the  urban development corporation for
cultural facilities projects, reimbursement from the proceeds  of  notes
or  bonds  issued  by  the  dormitory authority or the urban development
corporation for capital appropriations totaling  $60,000,000  authorized
by  chapter 108 of the laws of 2006 to the urban development corporation
for energy/environmental projects, reimbursement from  the  proceeds  of
notes  or  bonds issued by the dormitory authority or the urban develop-
ment corporation for a capital appropriation of  $20,000,000  authorized
by  chapter 108 of the laws of 2006 to the urban development corporation
for a competitive solicitation for construction of  a  pilot  cellulosic
ethanol  refinery,  reimbursement  from  the  proceeds of notes or bonds
issued by the urban development corporation for a capital  appropriation
of $74,700,000 authorized by chapter 55 of the laws of 2006 to the urban
development corporation for services and expenses related to infrastruc-
ture  for  a  new  stadium  in Queens county, and reimbursement from the
proceeds of notes or bonds issued by the urban  development  corporation
for  a  capital appropriation of $74,700,000 authorized by chapter 55 of
the laws of 2006 to the urban development corporation for  services  and
expenses related to infrastructure improvements to construct a new park-
ing  facility  at  a new stadium in Bronx county, reimbursement from the
proceeds of notes and  bonds  issued  by  the  environmental  facilities
corporation  for  a  capital  appropriation  of $5,000,000 authorized by
chapter 55 of the laws of 2006 to the  environmental  facilities  corpo-
ration for payment for the pipeline for jobs program, reimbursement from
the  proceeds  of  notes  or bonds issued by the dormitory authority for

S. 2609--C                         132

capital disbursements of up to $14,000,000 from  any  capital  appropri-
ation  or  reappropriation  authorized by chapter 53 of the laws of 2006
for the library construction purpose, reimbursement from the proceeds of
notes or bonds issued by the urban development corporation or the dormi-
tory  authority for an appropriation of $1,200,000 authorized by chapter
53 of the laws of 2006 for the towns of Bristol and  Canandaigua  public
water  systems, reimbursement from the proceeds of notes or bonds issued
by the urban development corporation or the dormitory authority  for  an
appropriation of $5,500,000 authorized by chapter 53 of the laws of 2006
for  Belleayre  mountain  ski center, reimbursement from the proceeds of
notes or bonds issued by the urban development corporation or the dormi-
tory authority for an appropriation of $25,000,000 authorized by chapter
53 of the laws of 2006 for the town of Smithtown/Kings Park  psychiatric
center rehabilitation, reimbursement from the proceeds of notes or bonds
issued  by  the urban development corporation or the dormitory authority
for an appropriation of $5,000,000 authorized by chapter 108 of the laws
of 2006 for a state of New York umbilical cord bank, reimbursement  from
the  proceeds  of  notes or bonds issued by the urban development corpo-
ration or the dormitory authority for  an  appropriation  of  $5,500,000
authorized  by  chapter  53 of the laws of 2006 for an Old Gore mountain
ski bowl connection, reimbursement from the proceeds of notes  or  bonds
issued  by  the urban development corporation or the dormitory authority
for an appropriation of $2,000,000 authorized by chapter 53 of the  laws
of 2006 for a Cornell equine drug testing laboratory, reimbursement from
the  proceeds  of  notes or bonds issued by the urban development corpo-
ration or the dormitory authority for  an  appropriation  of  $2,000,000
authorized  by  chapter  53  of the laws of 2006 for a Fredonia vineyard
laboratory, reimbursement from the proceeds of notes or bonds issued  by
the  dormitory  authority  or  the  urban development corporation for an
appropriation of $40,000,000 authorized by chapter 108 of  the  laws  of
2006  for  a food testing laboratory, reimbursement from the proceeds of
notes or bonds issued by the New York state  thruway  authority  for  an
appropriation  of  $22,000,000  authorized by chapter 108 of the laws of
2006 to the department of transportation for high speed rail, reimburse-
ment from the proceeds of notes or bonds issued by the urban development
corporation for capital disbursements of  up  to  $500,000,000  from  an
appropriation authorized by chapter 108 of the laws of 2006 to the urban
development corporation for development of a semiconductor manufacturing
facility,  reimbursement  from  the proceeds of notes or bonds issued by
the urban development corporation of up to $150,000,000 from  an  appro-
priation  authorized  by  chapter  108  of the laws of 2006 to the urban
development corporation for research and  development  activities  of  a
semiconductor manufacturer, and reimbursement from the proceeds of notes
or  bonds  issued  by  the  urban  development  corporation  for capital
disbursements of up to $292,385,000 from an appropriation to  the  urban
development  corporation  authorized  by chapter 108 of the laws of 2006
for community revitalization projects.
  S 31. Notwithstanding any  other  law,  rule,  or  regulation  to  the
contrary,  the  comptroller is hereby authorized and directed to deposit
to the credit of the  capital  projects  fund,  reimbursement  from  the
proceeds of notes or bonds issued by the environmental facilities corpo-
ration  for a capital appropriation of $29,600,000 authorized by chapter
55 of the laws of 2007 to the department of  environmental  conservation
for payment of a portion of the state's match for federal capitalization
grants  for  the water pollution control revolving loan fund, reimburse-
ment from the proceeds of notes or bonds issued by the urban development

S. 2609--C                         133

corporation for disbursements of up  to  $20,000,000  from  any  capital
appropriation or reappropriation authorized by chapter 50 of the laws of
2007  to the office of general services for various purposes, reimburse-
ment  from  the  proceeds  of notes or bonds issued by the environmental
facilities  corporation  for  a  capital  appropriation  of  $13,500,000
authorized  by chapter 55 of the laws of 2007 to the energy research and
development authority for the Western New York Nuclear Service Center at
West Valley, reimbursement from the proceeds of notes or bonds issued by
the environmental facilities corporation for a capital appropriation  of
$10,000,000  authorized by chapter 55 of the laws of 2007 to the depart-
ment of environmental conservation for Onondaga lake, reimbursement from
the proceeds of notes or bonds issued by  the  environmental  facilities
corporation  for  disbursements  of  up  to $12,000,000 from any capital
appropriations or reappropriations authorized by chapter 55 of the  laws
of  2007  to  the  department of environmental conservation for environ-
mental purposes, reimbursement from  the  proceeds  of  notes  or  bonds
issued by the urban development corporation for capital disbursements of
up  to  $3,000,000  from  any  capital  appropriation or reappropriation
authorized by chapter 50 of the laws of 2007 to the division of military
and naval affairs for various purposes, reimbursement from the  proceeds
of  notes  or  bonds  issued  by  the  urban development corporation for
disbursements from a capital appropriation of $50,000,000 authorized  by
chapter  50  of  the  laws  of  2007 to the division of state police for
construction of a Troop G facility, reimbursement from the  proceeds  of
notes or bonds issued by the urban development corporation for disburse-
ments  from  a capital appropriation of $6,000,000 authorized by chapter
50 of the laws of 2007 to the division of state police for  construction
of evidence storage facilities, reimbursement from the proceeds of notes
or  bonds  issued  by  the  dormitory authority or the urban development
corporation for capital appropriations totaling  $77,900,000  authorized
by  chapter  51  of the laws of 2007 to the judiciary for court training
facilities and courthouse improvement projects, reimbursement  from  the
proceeds  of  notes or bonds issued by the urban development corporation
for a capital appropriation of $20,000,000 authorized by chapter  50  of
the  laws of 2007 to all state departments and agencies for the purchase
of equipment, reimbursement from the proceeds of notes or  bonds  issued
by   the   dormitory  authority  for  capital  disbursements  of  up  to
$14,000,000 from any capital appropriation or reappropriation authorized
by chapter 53 of the laws of 2007 for library  construction,  reimburse-
ment from the proceeds of notes or bonds issued by the dormitory author-
ity  for  capital  disbursements  of  up to $60,000,000 from any capital
appropriation or reappropriation authorized by chapter 53 of the laws of
2007 for cultural education storage facilities, reimbursement  from  the
proceeds  of  notes or bonds issued by the urban development corporation
for capital disbursements of up to $15,000,000 from any  capital  appro-
priation or reappropriation authorized by chapter 55 of the laws of 2007
for Roosevelt Island Operating Corporation aerial tramway, reimbursement
from  the  proceeds  of  notes  or bonds issued by the urban development
corporation for capital disbursements of  up  to  $20,000,000  from  any
capital appropriation or reappropriation authorized by chapter 55 of the
laws  of  2007 for Governor's Island, reimbursement from the proceeds of
notes or bonds issued by the urban development corporation  for  capital
disbursements  of  up  to  $7,500,000  from any capital appropriation or
reappropriation authorized by chapter 55 of the laws of 2007 for  Harri-
man  research  and  technology  park, reimbursement from the proceeds of
notes or bonds issued by the urban development corporation  for  capital

S. 2609--C                         134

disbursements  of  up  to  $7,950,000  from any capital appropriation or
reappropriation authorized by chapter 55 of the laws  of  2007  for  USA
Niagara, and reimbursement from the proceeds of notes or bonds issued by
the  urban  development  corporation  for capital disbursements of up to
$1,300,000 from appropriations authorized by chapter 50 of the  laws  of
2007  made  to  the  office  of  general services for legislative office
building hearing rooms.
  S 32. Notwithstanding any  other  law,  rule,  or  regulation  to  the
contrary,  the  comptroller is hereby authorized and directed to deposit
to the credit of the  capital  projects  fund,  reimbursement  from  the
proceeds of notes or bonds issued by the environmental facilities corpo-
ration  for a capital appropriation of $29,600,000 authorized by chapter
55 of the laws of 2008 to the department of  environmental  conservation
for payment of a portion of the state's match for federal capitalization
grants  for  the water pollution control revolving loan fund, reimburse-
ment from the proceeds of notes or bonds issued by the urban development
corporation for a capital appropriation of  $141,000,000  authorized  by
chapter 50 of the laws of 2008 to all state departments and agencies for
the purchase of equipment or systems development, reimbursement from the
proceeds  of  notes or bonds issued by the urban development corporation
for disbursements of up to $45,500,000 from any capital appropriation or
reappropriation authorized by chapter 50 of the  laws  of  2008  to  the
office  of general services for various purposes, reimbursement from the
proceeds of notes or bonds issued by the environmental facilities corpo-
ration for a capital appropriation of $13,500,000 authorized by  chapter
55  of the laws of 2008 to the energy research and development authority
for the  Western  New  York  Nuclear  Service  Center  at  West  Valley,
reimbursement from the proceeds of notes or bonds issued by the environ-
mental facilities corporation for a capital appropriation of $10,000,000
authorized  by chapter 55 of the laws of 2008 to the department of envi-
ronmental  conservation  for  Onondaga  lake,  reimbursement  from   the
proceeds of notes or bonds issued by the environmental facilities corpo-
ration for disbursements of up to $12,000,000 from any capital appropri-
ations  or reappropriations authorized by chapter 55 of the laws of 2008
to  the  department  of  environmental  conservation  for  environmental
purposes,  reimbursement  from  the proceeds of notes or bonds issued by
the urban development corporation for capital  disbursements  of  up  to
$3,000,000  from any capital appropriation or reappropriation authorized
by chapter 50 of the laws of 2008 to the division of military and  naval
affairs  for  various purposes, reimbursement from the proceeds of notes
or bonds issued by the  urban  development  corporation  for  a  capital
appropriation of $2,500,000 authorized by chapter 50 of the laws of 2008
to  the  office  for  technology  for  activities  related  to broadband
service, reimbursement from the proceeds of notes or bonds issued by the
urban development corporation for a capital appropriation of  $6,000,000
authorized  by  chapter  50 of the laws of 2008 to the division of state
police for rehabilitation of facilities, reimbursement from the proceeds
of notes or bonds issued by the dormitory authority of the state of  New
York or other financing source for a capital appropriation authorized by
chapter  53  of the laws of 2008 of $14,000,000 to the education depart-
ment for library construction, reimbursement from the proceeds of  notes
or  bonds  issued by the dormitory authority of the state of New York or
other financing source for a capital appropriation authorized by chapter
53 of the laws of 2008 of $15,000,000 to the  education  department  for
museum  renewal  projects,  reimbursement  from the proceeds of notes or
bonds issued by the urban development corporation for capital  appropri-

S. 2609--C                         135

ation of $50,000,000 authorized by chapter 53 of the laws of 2008 to the
urban  development  corporation for services and expenses related to the
investment opportunity fund, reimbursement from the proceeds of notes or
bonds  issued by the urban development corporation for capital appropri-
ation of $18,000,000 authorized by chapter 53 of the laws of 2008 to the
urban development corporation for services and expenses related to  arts
and cultural projects, reimbursement from the proceeds of bonds or notes
issued  by the urban development corporation for a capital appropriation
of $32,148,000 authorized by chapter 53 of the laws of 2008 for economic
and community development projects, reimbursement from the  proceeds  of
bonds or notes issued by the urban development corporation for a capital
appropriation  of  $30,000,000  authorized  by chapter 53 of the laws of
2008 for New York city waterfront  development  projects,  reimbursement
from  the  proceeds  of  bonds  or notes issued by the urban development
corporation for a capital appropriation  of  $45,000,000  authorized  by
chapter  53  of  the  laws  of  2008  for  Luther  Forest infrastructure
projects, reimbursement from the proceeds of notes or  bonds  issued  by
the   urban   development   corporation  for  capital  appropriation  of
$35,000,000 authorized by chapter 53 of the laws of 2008  to  the  urban
development  corporation  for services and expenses related to downstate
regional projects, reimbursement from the proceeds  of  notes  or  bonds
issued by the urban development corporation for capital appropriation of
$137,037,000  authorized  by chapter 53 of the laws of 2008 to the urban
development corporation for services and  expenses  related  to  upstate
city-by-city projects, reimbursement from the proceeds of notes or bonds
issued by the urban development corporation for capital appropriation of
$35,000,000  authorized  by  chapter 53 of the laws of 2008 to the urban
development corporation for services and expenses related to  the  down-
state  revitalization projects, reimbursement from the proceeds of notes
or bonds issued by the urban development corporation for capital  appro-
priation of $117,265,000 authorized by chapter 53 of the laws of 2008 to
the  urban  development corporation for services and expenses related to
the upstate regional blueprint fund, reimbursement from the proceeds  of
notes  or  bonds issued by the urban development corporation for capital
appropriation of $25,000,000 authorized by chapter 53  of  the  laws  of
2008  to  the  urban  development  corporation for services and expenses
related  to  the  upstate  agricultural   economic   development   fund,
reimbursement  from  the  proceeds of notes or bonds issued by the urban
development  corporation  for  capital  appropriation  of   $350,000,000
authorized  by  chapter  53 of the laws of 2008 to the urban development
corporation for services and expenses related  to  the  New  York  state
capital  assistance program, reimbursement from the proceeds of notes or
bonds issued by the urban development corporation for capital  appropri-
ation  of  $350,000,000  authorized by chapter 53 of the laws of 2008 to
the urban development corporation for services and expenses  related  to
the   New  York  state  economic  development  assistance  program,  and
reimbursement from the proceeds of notes or bonds issued  by  the  urban
development corporation for capital appropriation of $20,000,000 author-
ized  by  chapter 55 of the laws of 2008 to the urban development corpo-
ration for services and expenses related to the  empire  state  economic
development fund.
  S  33.  Notwithstanding  any  other  law,  rule,  or regulation to the
contrary, the comptroller is hereby authorized and directed  to  deposit
to  the  credit  of  the  capital  projects fund, reimbursement from the
proceeds of notes or bonds issued by the environmental facilities corpo-
ration for a capital appropriation of $29,600,000 authorized by  chapter

S. 2609--C                         136

55  of  the laws of 2009 to the department of environmental conservation
for payment of a portion of the state's match for federal capitalization
grants for the water pollution control revolving loan  fund,  reimburse-
ment from the proceeds of notes or bonds issued by the urban development
corporation  for  a  capital appropriation of $129,800,000 authorized by
chapter 50 of the laws of 2009 to all state departments and agencies for
the purchase of equipment or systems development, reimbursement from the
proceeds of notes or bonds issued by the urban  development  corporation
for disbursements of up to $24,000,000 from any capital appropriation or
reappropriation  authorized  by  chapter  50  of the laws of 2009 to the
office of general services for various purposes, reimbursement from  the
proceeds of notes or bonds issued by the environmental facilities corpo-
ration  for a capital appropriation of $13,500,000 authorized by chapter
55 of the laws of 2009 to the energy research and development  authority
for  the  Western  New  York  Nuclear  Service  Center  at  West Valley,
reimbursement from the proceeds of notes or bonds issued by the environ-
mental facilities corporation for a capital appropriation of $10,000,000
authorized by chapter 55 of the laws of 2009 to the department of  envi-
ronmental   conservation  for  Onondaga  lake,  reimbursement  from  the
proceeds of notes or bonds issued by the environmental facilities corpo-
ration for disbursements of up to $12,000,000 from any capital appropri-
ations or reappropriations authorized by chapter 55 of the laws of  2009
to  the  department  of  environmental  conservation  for  environmental
purposes, reimbursement from the proceeds of notes or  bonds  issued  by
the  urban  development  corporation  for capital disbursements of up to
$3,000,000 from any capital appropriation or reappropriation  authorized
by  chapter 50 of the laws of 2009 to the division of military and naval
affairs for various purposes, reimbursement from the proceeds  of  notes
or  bonds  issued  by  the  urban  development corporation for a capital
appropriation of $6,000,000 authorized by chapter 50 of the laws of 2009
to the division  of  state  police  for  rehabilitation  of  facilities,
reimbursement from the proceeds of notes or bonds issued by the dormito-
ry  authority  of  the state of New York or other financing source for a
capital appropriation authorized by chapter 53 of the laws  of  2009  of
$14,000,000  to the state education department for library construction,
reimbursement from the proceeds of notes or bonds issued by the dormito-
ry authority of the state of New York or other financing  source  for  a
capital  appropriation  of  $4,000,000 to the state education department
for rehabilitation associated  with  the  St.  Regis  Mohawk  elementary
school  authorized  by  chapter 53 of the laws of 2009 and reimbursement
from the proceeds of notes or bonds  issued  by  the  urban  development
corporation for capital appropriation of $25,000,000 authorized by chap-
ter  55  of  the  laws  of 2009 to the urban development corporation for
services and expenses related to the empire state  economic  development
fund.
  S  34.  Notwithstanding  any  other  law,  rule,  or regulation to the
contrary, the comptroller is hereby authorized and directed  to  deposit
to  the  credit  of  the  capital  projects fund, reimbursement from the
proceeds of notes or bonds issued by the environmental facilities corpo-
ration for a capital appropriation of $29,600,000 authorized by  chapter
55  of  the laws of 2010 to the department of environmental conservation
for payment of a portion of the state's match for federal capitalization
grants for the water pollution control revolving loan  fund,  reimburse-
ment from the proceeds of notes or bonds issued by the urban development
corporation  for  a  capital appropriation of $187,285,000 authorized by
chapter 50 of the laws of 2010 to all state departments and agencies for

S. 2609--C                         137

the purchase of equipment or systems development, reimbursement from the
proceeds of notes or bonds issued by the urban  development  corporation
for disbursements of up to $26,950,000 from any capital appropriation or
reappropriation  authorized  by  chapter  50  of the laws of 2010 to the
office of general services for various purposes, reimbursement from  the
proceeds of notes or bonds issued by the environmental facilities corpo-
ration  for  a capital appropriation of $5,000,000 authorized by chapter
55 of the laws of 2010 to the department of  environmental  conservation
for  Onondaga  lake,  reimbursement  from the proceeds of notes or bonds
issued by the environmental facilities corporation for disbursements  of
up  to  $12,000,000  from any capital appropriations or reappropriations
authorized by chapter 55 of the laws of 2010 to the department of  envi-
ronmental  conservation  for  environmental purposes, reimbursement from
the proceeds of notes or bonds issued by the  urban  development  corpo-
ration  for  capital  disbursements of up to $3,000,000 from any capital
appropriation or reappropriation authorized by chapter 50 of the laws of
2010 to the division of military and naval affairs for various purposes,
reimbursement from the proceeds of notes or bonds issued  by  the  urban
development  corporation  for  a  capital  appropriation  of  $6,000,000
authorized by chapter 50 of the laws of 2010 to the  division  of  state
police for rehabilitation of facilities, reimbursement from the proceeds
of  notes or bonds issued by the dormitory authority of the state of New
York  or  other  financing  source  for  a  capital   appropriation   of
$14,000,000  authorized  by  chapter 53 of the laws of 2010 to the state
education department for library construction, reimbursements  from  the
proceeds  of  notes  or  bonds  issued by the dormitory authority of the
state of New York or other financing source for a capital  appropriation
of  $20,400,000  authorized  by  chapter  100 of the laws of 2010 to the
state  education  department  for  the  longitudinal  data  system   and
reimbursement from the proceeds of notes or bonds issued by the dormito-
ry  authority  of  the state of New York or other financing source for a
capital appropriation of $42,000,000  for  the  state  preparedness  and
training center.
  S  35.  Notwithstanding  any  other  law,  rule,  or regulation to the
contrary, the comptroller is hereby authorized and directed  to  deposit
to  the  credit  of  the  capital  projects fund, reimbursement from the
proceeds of notes or bonds issued by the environmental facilities corpo-
ration for a capital appropriation of $35,000,000 authorized by a  chap-
ter  of the laws of 2011 to the department of environmental conservation
for payment of a portion of the state's match for federal capitalization
grants for the water pollution control revolving loan  fund,  reimburse-
ment from the proceeds of notes or bonds issued by the urban development
corporation  for  a capital appropriation of $92,751,000 authorized by a
chapter of the laws of 2011 to all state departments  and  agencies  for
the purchase of equipment or systems development, reimbursement from the
proceeds  of  notes or bonds issued by the urban development corporation
for disbursements of up to $40,000,000 from any capital appropriation or
reappropriation authorized by a chapter of  the  laws  of  2011  to  the
office  of general services for various purposes, reimbursement from the
proceeds of notes or bonds issued by the environmental facilities corpo-
ration for disbursements of up to $12,000,000 from any capital appropri-
ations or reappropriations authorized by a chapter of the laws  of  2011
to  the  department  of  environmental  conservation  for  environmental
purposes, reimbursement from the proceeds of notes or  bonds  issued  by
the  urban  development  corporation  for capital disbursements of up to
$3,000,000 from any capital appropriation or reappropriation  authorized

S. 2609--C                         138

by  a  chapter of the laws of 2011 to the division of military and naval
affairs for various purposes, reimbursement from the proceeds  of  notes
or  bonds  issued  by  the  urban  development corporation for a capital
appropriation  of $6,000,000 authorized by a chapter of the laws of 2011
to the division  of  state  police  for  rehabilitation  of  facilities,
reimbursement from the proceeds of notes or bonds issued by the dormito-
ry  authority  of  the state of New York or other financing source for a
capital appropriation of $14,000,000 authorized by a chapter of the laws
of 2011 to the state  education  department  for  library  construction,
reimbursement  from  the  proceeds of notes or bonds issued by the urban
development  corporation  for  capital  appropriation  of   $130,550,000
authorized  by  a  chapter  of the laws of 2011 to the urban development
corporation for services and expenses related to the  regional  economic
development council initiative, reimbursement from the proceeds of notes
or  bonds issued by the urban development corporation for capital appro-
priation of $50,000,000 authorized by a chapter of the laws of  2011  to
the  urban  development corporation for services and expenses related to
the economic transformation program.  Reimbursements from  the  proceeds
of  notes  or  bonds  issued  by  the  urban development corporation for
disbursements of up to $40,000,000 from  any  capital  appropriation  or
reappropriation  authorized  by  a  chapter  of  the laws of 2011 to the
office of general services for various purposes.
  S 36. Notwithstanding any  other  law,  rule,  or  regulation  to  the
contrary,  the  comptroller is hereby authorized and directed to deposit
to the credit of the  capital  projects  fund,  reimbursement  from  the
proceeds of notes or bonds issued by the environmental facilities corpo-
ration  for a capital appropriation of $35,000,000 authorized by a chap-
ter of the laws of 2012 to the department of environmental  conservation
for payment of a portion of the state's match for federal capitalization
grants  for  the water pollution control revolving loan fund, reimburse-
ment from the proceeds of notes or bonds  issued  by  the  environmental
facilities  corporation  for disbursements of up to $12,000,000 from any
capital appropriations or reappropriations authorized by  a  chapter  of
the  laws  of  2012  to the department of environmental conservation for
environmental purposes, reimbursement from  the  proceeds  of  notes  or
bonds  issued by the urban development corporation for capital disburse-
ments of up to $3,000,000 from any capital appropriation or  reappropri-
ation  authorized  by  a  chapter of the laws of 2012 to the division of
military and naval affairs for various purposes, reimbursement from  the
proceeds  of  notes or bonds issued by the urban development corporation
for a capital appropriation of $6,000,000 authorized by a chapter of the
laws of 2012 to the division  of  state  police  for  rehabilitation  of
facilities,  reimbursement from the proceeds of notes or bonds issued by
the dormitory authority of the state of  New  York  or  other  financing
source  for a capital appropriation of $14,000,000 authorized by a chap-
ter of the laws of 2012 to the state education  department  for  library
construction,  reimbursement  from the proceeds of notes or bonds issued
by the thruway authority, the dormitory authority and the urban develop-
ment corporation for a capital appropriation of $770,000,000  authorized
by  chapter  54  of  the laws of 2012 to the metropolitan transportation
authority for various purposes, reimbursement from the proceeds of notes
or bonds issued by the thruway authority for a capital appropriation  of
$15,000,000  authorized by chapter 54 of the laws of 2012 to the depart-
ment of transportation  for  improvement  of  the  peace  bridge  plaza,
reimbursement  from  the  proceeds of notes or bonds issued by the urban
development corporation for  a  capital  appropriation  of  $130,000,000

S. 2609--C                         139

authorized  by  a  chapter  of the laws of 2012 to the urban development
corporation for services and expenses related to the  regional  economic
development council initiative, reimbursement from the proceeds of notes
or  bonds  issued  by  the  urban  development corporation for a capital
appropriation of $75,000,000 authorized by a chapter of the laws of 2012
to the urban development corporation for services and  expenses  related
to  the New York works economic development fund, reimbursement from the
proceeds of notes or bonds issued by the urban  development  corporation
for  a  capital  appropriation of $75,000,000 authorized by a chapter of
the laws of 2012 to the urban development corporation for  services  and
expenses  related to the buffalo regional innovation cluster, reimburse-
ment from the proceeds of notes or bonds issued by the urban development
corporation for a capital appropriation of $250,000,000 authorized by  a
chapter  of  the  laws  of 2012 to the urban development corporation for
services and expenses related  to  the  state  university  of  New  York
college  for  nanoscale  and science engineering project, reimbursements
from the proceeds of notes or bonds  issued  by  the  urban  development
corporation  for  disbursements  of  up  to $26,000,000 from any capital
appropriation or reappropriation authorized by a chapter of the laws  of
2012 to the office of general services for various purposes.
  S  37.  Notwithstanding  any  other  law,  rule,  or regulation to the
contrary, the comptroller is hereby authorized and directed  to  deposit
to  the  credit  of  the  capital  projects fund, reimbursement from the
proceeds of notes or bonds issued by the environmental facilities corpo-
ration for a capital appropriation of $35,000,000 authorized by a  chap-
ter  of the laws of 2013 to the department of environmental conservation
for payment of a portion of the state's match for federal capitalization
grants for the water pollution control revolving loan  fund,  reimburse-
ment  from  the  proceeds  of notes or bonds issued by the environmental
facilities corporation for disbursements of up to $12,000,000  from  any
capital  appropriations  or  reappropriations authorized by a chapter of
the laws of 2013 to the department  of  environmental  conservation  for
environmental  purposes,  reimbursement  from  the  proceeds of notes or
bonds issued by the urban development corporation for capital  disburse-
ments  of up to $3,000,000 from any capital appropriation or reappropri-
ation authorized by a chapter of the laws of 2013  to  the  division  of
military  and naval affairs for various purposes, reimbursement from the
proceeds of notes or bonds issued by the urban  development  corporation
for a capital appropriation of $7,000,000 authorized by a chapter of the
laws  of  2013  to  the  division  of state police for rehabilitation of
facilities, reimbursement from the proceeds of notes or bonds issued  by
the  urban  development  corporation  for  a  capital  appropriation  of
$12,500,000 authorized by a chapter of the laws of 2013 to the  division
of  state police for aviation equipment, reimbursement from the proceeds
of notes or bonds issued by the dormitory authority of the state of  New
York   or   other  financing  source  for  a  capital  appropriation  of
$14,000,000 authorized by a chapter of the laws of  2013  to  the  state
education  department  for  library construction, reimbursement from the
proceeds of notes or bonds issued by the urban  development  corporation
for  a  capital  appropriation of $75,000,000 authorized by a chapter of
the laws of 2013 to the urban development corporation for  services  and
expenses  related to the buffalo regional innovation cluster, reimburse-
ment from the proceeds of notes or bonds issued by the urban development
corporation for a capital appropriation of $2,166,000  authorized  by  a
chapter  of  the  laws  of 2013 to the urban development corporation for
services and expenses related to the retention of professional  football

S. 2609--C                         140

in  Western New York, reimbursements from the proceeds of notes or bonds
issued by the urban development corporation for disbursements of  up  to
$26,000,000 from any capital appropriation or reappropriation authorized
by  a  chapter of the laws of 2013 to the office of general services for
various purposes, reimbursement from the  proceeds  of  notes  or  bonds
issued  by the urban development corporation for a capital appropriation
of $53,891,000 authorized by a chapter of the laws of 2013 to the  urban
development  corporation  for  services  and expenses related to capital
improvements at Ralph Wilson Stadium, reimbursement from the proceeds of
notes or bonds issued by the thruway authority for a  capital  appropri-
ation of $100,000,000 authorized by a chapter of the laws of 2013 to the
department of transportation for transportation infrastructure projects,
reimbursement  from the proceeds of notes or bonds issued by the thruway
authority for a capital appropriation of $200,000,000  authorized  by  a
chapter  of  the  laws  of  2013 to the department of transportation for
various purposes.
  S 38. For purposes of sections twenty-six through thirty-seven of this
act, the comptroller is also hereby authorized and directed  to  deposit
to  the  credit  of  any  capital  projects fund, reimbursement from the
proceeds of bonds and notes issued by any authorized issuer, as  defined
by  sections  68-a and 69-m of the state finance law, in the amounts and
for the purposes listed in such sections.
  S 39. Notwithstanding any  other  law,  rule,  or  regulation  to  the
contrary,  the  comptroller is hereby authorized and directed to deposit
to the credit of the  state  university  residence  hall  rehabilitation
fund,  reimbursement  from  the proceeds of notes or bonds issued by the
dormitory authority of the state of New York for  capital  disbursements
of  up to $331,000,000 from any appropriation or reappropriation author-
ized by a chapter of the laws of 2013.
  S 40. Notwithstanding any  other  law,  rule,  or  regulation  to  the
contrary,  the  comptroller is hereby authorized and directed to deposit
to the credit of the city university special revenue fund, reimbursement
from the proceeds of notes or bonds issued by the Dormitory Authority of
the State of New York for capital disbursements  of  up  to  $20,000,000
from  any  appropriation  or reappropriation authorized by chapter 53 of
the laws of 2009  to  the  city  university  of  New  York  for  various
purposes.
  S  41.  Notwithstanding  any  other  law,  rule,  or regulation to the
contrary, the state comptroller is hereby authorized and directed to use
any balance remaining in the mental health services  fund  debt  service
appropriation, after payment by the state comptroller of all obligations
required pursuant to any lease, sublease, or other financing arrangement
between the dormitory authority of the state of New York as successor to
the  New  York  state  medical  care  facilities finance agency, and the
facilities development corporation pursuant to chapter 83 of the laws of
1995 and the department of mental hygiene  for  the  purpose  of  making
payments  to  the  dormitory  authority of the state of New York for the
amount of the earnings for the investment of  monies  deposited  in  the
mental health services fund that such agency determines will or may have
to  be  rebated  to the federal government pursuant to the provisions of
the internal revenue code of 1986, as amended, in order to  enable  such
agency  to  maintain  the  exemption from federal income taxation on the
interest paid to the holders of such agency's mental services facilities
improvement revenue bonds. On or before June 30, 2013, such agency shall
certify to the  state  comptroller  its  determination  of  the  amounts
received  in  the mental health services fund as a result of the invest-

S. 2609--C                         141

ment of monies deposited therein that will or may have to be rebated  to
the federal government pursuant to the provisions of the internal reven-
ue code of 1986, as amended.
  S  42.  (1)  Notwithstanding any other law, rule, or regulation to the
contrary, the state comptroller shall at the commencement of each  month
certify to the director of the budget, the commissioner of environmental
conservation,  the  chair of the senate finance committee, and the chair
of the assembly ways and means committee the amounts disbursed from  all
appropriations  for  hazardous  waste site remediation disbursements for
the month preceding such certification.
  (2) Notwithstanding any law to the contrary, prior to the issuance  by
the comptroller of bonds authorized pursuant to subdivision a of section
4  of the environmental quality bond act of nineteen hundred eighty-six,
as enacted by chapter 511 of the laws of 1986,  disbursements  from  all
appropriations  for  that  purpose shall first be reimbursed from moneys
credited to the hazardous waste remedial fund,  site  investigation  and
construction  account,  to  the  extent  moneys  are  available  in such
account. For purposes of determining moneys available in  such  account,
the  commissioner  of  environmental  conservation  shall certify to the
comptroller the amounts required for  administration  of  the  hazardous
waste remedial program.
  (3)  The comptroller is hereby authorized and directed to transfer any
balance above the amounts certified by the commissioner of environmental
conservation to reimburse disbursements pursuant to  all  appropriations
from  such site investigation and construction account; provided, howev-
er, that if such transfers are  determined  by  the  comptroller  to  be
insufficient  to  assure  that  interest  paid to holders of state obli-
gations issued for hazardous waste purposes  pursuant  to  the  environ-
mental  quality  bond  act of nineteen hundred eighty-six, as enacted by
chapter 511 of the laws of 1986, is exempt from federal income taxation,
the comptroller is hereby authorized and directed to transfer, from such
site investigation and construction account to  the  general  fund,  the
amount  necessary  to  redeem bonds in an amount necessary to assure the
continuation of such tax exempt status. Prior to the making of any  such
transfers,  the  comptroller  shall notify the director of the budget of
the amount of such transfers.
  S 43. Subdivision 2 of section 68-a  of  the  state  finance  law,  as
amended  by  section  36 of part U of chapter 59 of the laws of 2012, is
amended to read as follows:
  2. "Authorized purpose" for purposes of this article and section nine-
ty-two-z of this chapter shall mean any purposes  for  which  state-sup-
ported debt, as defined by section sixty-seven-a of this chapter, may or
has  been  issued  except  debt  for which the state is constitutionally
obligated thereunder to pay debt  service  and  related  expenses[,  and
except  (a) as authorized in paragraph (b) of subdivision one of section
three hundred eighty-five of the public authorities law, (b) as  author-
ized for the department of health of the state of New York facilities as
specified  in  paragraph a of subdivision two of section sixteen hundred
eighty of the public authorities law, (c) state university of  New  York
dormitory  facilities  as  specified  in  subdivision  eight  of section
sixteen hundred seventy-eight of the public authorities law, and (d)  as
authorized  for  mental  health services facilities by section nine-a of
section one of chapter three hundred ninety-two of the laws of  nineteen
hundred  seventy-three  constituting  the  New  York  state medical care
facilities financing act. Notwithstanding the provisions of  clause  (d)
of  this  subdivision,  for  the  period  April first, two thousand nine

S. 2609--C                         142

through  March  thirty-first,  two  thousand  thirteen,  mental   health
services  facilities,  as authorized by section nine-a of section one of
chapter three hundred ninety-two of the laws of nineteen hundred  seven-
ty-three constituting the New York state medical care facilities financ-
ing act, shall constitute an authorized purpose].
  S  44.  Subdivision  8  of  section  68-b of the state finance law, as
amended by section 35 of part BB of chapter 58 of the laws of  2011,  is
amended to read as follows:
  8.  Revenue  bonds  may  only  be  issued  for authorized purposes, as
defined in section sixty-eight-a of this  article.  Notwithstanding  the
foregoing,  the  dormitory  authority  of  the state of New York and the
urban development corporation may issue revenue bonds for any authorized
purpose of any other such authorized issuer [through March thirty-first,
two thousand thirteen]. The  authorized  issuers  shall  not  issue  any
revenue  bonds  in  an  amount in excess of statutory authorizations for
such authorized purposes. Authorizations for  such  authorized  purposes
shall  be  reduced  in  an  amount  equal to the amount of revenue bonds
issued for such authorized purposes under this article.  Such  reduction
shall  not  be  made in relation to revenue bonds issued to fund reserve
funds, if any, and costs of issuance, if these  items  are  not  counted
under  existing authorizations, nor shall revenue bonds issued to refund
bonds issued under existing authorizations reduce  the  amount  of  such
authorizations.
  S  45. Subdivision 5 of section 3234 of the public authorities law, as
amended by section 54 of part K of chapter 81 of the laws  of  2002,  is
amended to read as follows:
  5.  A  majority  of the whole number of directors then in office shall
constitute a quorum for the transaction of any business or the  exercise
of  any  power of the corporation. Except as otherwise specified in this
title, for the transaction of any business or the exercise of any  power
of the corporation, the corporation shall have power to act by a majori-
ty  of  the  directors  present  at  any meeting at which a quorum is in
attendance; provided that one or more directors  may  participate  in  a
meeting  by  means  of  conference  telephone  or similar communications
equipment allowing all directors participating in the  meeting  to  hear
each  other  at  the  same  time  and  participation by such means shall
constitute presence in person at a meeting.  A  unanimous  vote  of  all
directors  THEN IN OFFICE shall be required for approval of a resolution
authorizing the issuance of bonds or notes or any supplemental or  amen-
datory  resolution.   The corporation may delegate to one or more of its
directors, or officers, agents and employees, such powers and duties  as
the  directors  may deem proper. Five days notice shall be given to each
director and nonvoting representative prior to any meeting of the corpo-
ration.
  S 46. Section 1 of chapter 174 of the laws of 1968,  constituting  the
New York state urban development corporation act, is amended by adding a
new section 46 to read as follows:
  S  46.  1.  NOTWITHSTANDING  THE  PROVISIONS  OF  ANY OTHER LAW TO THE
CONTRARY, THE DORMITORY AUTHORITY AND THE CORPORATION ARE HEREBY AUTHOR-
IZED TO ISSUE BONDS OR NOTES IN ONE OR MORE SERIES FOR  THE  PURPOSE  OF
FUNDING PROJECT COSTS FOR THE NEW YORK STATE STORM RECOVERY CAPITAL FUND
AND  OTHER STATE COSTS ASSOCIATED WITH SUCH CAPITAL PROJECTS. THE AGGRE-
GATE PRINCIPAL AMOUNT OF BONDS AUTHORIZED TO BE ISSUED PURSUANT TO  THIS
SECTION  SHALL  NOT EXCEED FOUR HUNDRED FIFTY MILLION DOLLARS, EXCLUDING
BONDS ISSUED TO FUND ONE OR MORE DEBT  SERVICE  RESERVE  FUNDS,  TO  PAY
COSTS  OF ISSUANCE OF SUCH BONDS, AND BONDS OR NOTES ISSUED TO REFUND OR

S. 2609--C                         143

OTHERWISE REPAY SUCH BONDS OR NOTES PREVIOUSLY ISSUED.  SUCH  BONDS  AND
NOTES OF THE DORMITORY AUTHORITY AND THE CORPORATION SHALL NOT BE A DEBT
OF  THE STATE, AND THE STATE SHALL NOT BE LIABLE THEREON, NOR SHALL THEY
BE  PAYABLE  OUT OF ANY FUNDS OTHER THAN THOSE APPROPRIATED BY THE STATE
TO THE DORMITORY AUTHORITY AND THE CORPORATION FOR PRINCIPAL,  INTEREST,
AND  RELATED  EXPENSES PURSUANT TO A SERVICE CONTRACT AND SUCH BONDS AND
NOTES SHALL CONTAIN ON THE FACE THEREOF  A  STATEMENT  TO  SUCH  EFFECT.
EXCEPT  FOR  PURPOSES  OF  COMPLYING WITH THE INTERNAL REVENUE CODE, ANY
INTEREST INCOME EARNED ON BOND PROCEEDS SHALL ONLY BE USED TO  PAY  DEBT
SERVICE ON SUCH BONDS.
  2.  NOTWITHSTANDING  ANY  OTHER  PROVISION  OF LAW TO THE CONTRARY, IN
ORDER TO ASSIST THE DORMITORY AUTHORITY AND THE CORPORATION IN UNDERTAK-
ING THE FINANCING FOR PROJECT COSTS FOR THE NEW YORK STATE STORM  RECOV-
ERY  CAPITAL  FUND  AND  OTHER  STATE COSTS ASSOCIATED WITH SUCH CAPITAL
PROJECTS, THE DIRECTOR OF THE BUDGET IS HEREBY AUTHORIZED TO ENTER  INTO
ONE  OR  MORE  SERVICE  CONTRACTS  WITH  THE DORMITORY AUTHORITY AND THE
CORPORATION, NONE OF WHICH SHALL EXCEED THIRTY YEARS IN  DURATION,  UPON
SUCH TERMS AND CONDITIONS AS THE DIRECTOR OF THE BUDGET AND THE DORMITO-
RY AUTHORITY AND THE CORPORATION AGREE, SO AS TO ANNUALLY PROVIDE TO THE
DORMITORY  AUTHORITY AND THE CORPORATION, IN THE AGGREGATE, A SUM NOT TO
EXCEED THE PRINCIPAL, INTEREST, AND RELATED EXPENSES REQUIRED  FOR  SUCH
BONDS  AND  NOTES.  ANY  SERVICE  CONTRACT ENTERED INTO PURSUANT TO THIS
SECTION SHALL PROVIDE THAT THE OBLIGATION OF THE STATE TO PAY THE AMOUNT
THEREIN PROVIDED SHALL NOT CONSTITUTE A DEBT OF  THE  STATE  WITHIN  THE
MEANING OF ANY CONSTITUTIONAL OR STATUTORY PROVISION AND SHALL BE DEEMED
EXECUTORY  ONLY  TO THE EXTENT OF MONIES AVAILABLE AND THAT NO LIABILITY
SHALL BE INCURRED BY THE STATE BEYOND  THE  MONIES  AVAILABLE  FOR  SUCH
PURPOSE,  SUBJECT  TO  ANNUAL APPROPRIATION BY THE LEGISLATURE. ANY SUCH
CONTRACT OR ANY PAYMENTS MADE OR TO BE MADE THEREUNDER MAY  BE  ASSIGNED
AND  PLEDGED  BY THE DORMITORY AUTHORITY AND THE CORPORATION AS SECURITY
FOR ITS BONDS AND NOTES, AS AUTHORIZED BY THIS SECTION.
  3. THE COMPTROLLER IS HEREBY AUTHORIZED TO RECEIVE FROM THE  DORMITORY
AUTHORITY  AND  THE  CORPORATION  ANY  PORTION  OF BOND PROCEEDS PAID TO
PROVIDE FUNDS FOR OR REIMBURSE THE STATE FOR ITS COSTS  ASSOCIATED  WITH
SUCH  CAPITAL  PROJECT  COSTS  AND TO CREDIT SUCH AMOUNTS TO THE CAPITAL
PROJECTS FUND OR ANY OTHER APPROPRIATE FUND.
  S 47. Section 1 of chapter 174 of the laws of 1968,  constituting  the
New York state urban development corporation act, is amended by adding a
new section 47 to read as follows:
  S  47.  1.  NOTWITHSTANDING  THE  PROVISIONS  OF  ANY OTHER LAW TO THE
CONTRARY, THE DORMITORY AUTHORITY AND THE CORPORATION ARE HEREBY AUTHOR-
IZED TO ISSUE BONDS OR NOTES IN ONE OR MORE SERIES FOR  THE  PURPOSE  OF
FUNDING  PROJECT COSTS FOR THE OFFICE OF INFORMATION TECHNOLOGY SERVICES
AND OTHER STATE COSTS ASSOCIATED WITH SUCH CAPITAL PROJECTS. THE  AGGRE-
GATE  PRINCIPAL AMOUNT OF BONDS AUTHORIZED TO BE ISSUED PURSUANT TO THIS
SECTION SHALL NOT EXCEED SIXTY MILLION DOLLARS, EXCLUDING  BONDS  ISSUED
TO FUND ONE OR MORE DEBT SERVICE RESERVE FUNDS, TO PAY COSTS OF ISSUANCE
OF  SUCH  BONDS,  AND BONDS OR NOTES ISSUED TO REFUND OR OTHERWISE REPAY
SUCH BONDS OR NOTES PREVIOUSLY ISSUED.  SUCH  BONDS  AND  NOTES  OF  THE
DORMITORY  AUTHORITY  AND  THE  CORPORATION  SHALL  NOT BE A DEBT OF THE
STATE, AND THE STATE SHALL NOT BE LIABLE  THEREON,  NOR  SHALL  THEY  BE
PAYABLE  OUT  OF ANY FUNDS OTHER THAN THOSE APPROPRIATED BY THE STATE TO
THE DORMITORY AUTHORITY AND THE CORPORATION FOR PRINCIPAL, INTEREST, AND
RELATED EXPENSES PURSUANT TO A SERVICE CONTRACT AND SUCH BONDS AND NOTES
SHALL CONTAIN ON THE FACE THEREOF A STATEMENT TO SUCH EFFECT. EXCEPT FOR
PURPOSES OF COMPLYING WITH  THE  INTERNAL  REVENUE  CODE,  ANY  INTEREST

S. 2609--C                         144

INCOME EARNED ON BOND PROCEEDS SHALL ONLY BE USED TO PAY DEBT SERVICE ON
SUCH BONDS.
  2.  NOTWITHSTANDING  ANY  OTHER  PROVISION  OF LAW TO THE CONTRARY, IN
ORDER TO ASSIST THE DORMITORY AUTHORITY AND THE CORPORATION IN UNDERTAK-
ING THE FINANCING FOR PROJECT COSTS FOR THE OFFICE OF INFORMATION  TECH-
NOLOGY  SERVICES  AND  OTHER  STATE  COSTS  ASSOCIATED WITH SUCH CAPITAL
PROJECTS, THE DIRECTOR OF THE BUDGET IS HEREBY AUTHORIZED TO ENTER  INTO
ONE  OR  MORE  SERVICE  CONTRACTS  WITH  THE DORMITORY AUTHORITY AND THE
CORPORATION, NONE OF WHICH SHALL EXCEED THIRTY YEARS IN  DURATION,  UPON
SUCH TERMS AND CONDITIONS AS THE DIRECTOR OF THE BUDGET AND THE DORMITO-
RY AUTHORITY AND THE CORPORATION AGREE, SO AS TO ANNUALLY PROVIDE TO THE
DORMITORY  AUTHORITY AND THE CORPORATION, IN THE AGGREGATE, A SUM NOT TO
EXCEED THE PRINCIPAL, INTEREST, AND RELATED EXPENSES REQUIRED  FOR  SUCH
BONDS  AND  NOTES.  ANY  SERVICE  CONTRACT ENTERED INTO PURSUANT TO THIS
SECTION SHALL PROVIDE THAT THE OBLIGATION OF THE STATE TO PAY THE AMOUNT
THEREIN PROVIDED SHALL NOT CONSTITUTE A DEBT OF  THE  STATE  WITHIN  THE
MEANING OF ANY CONSTITUTIONAL OR STATUTORY PROVISION AND SHALL BE DEEMED
EXECUTORY  ONLY  TO THE EXTENT OF MONIES AVAILABLE AND THAT NO LIABILITY
SHALL BE INCURRED BY THE STATE BEYOND  THE  MONIES  AVAILABLE  FOR  SUCH
PURPOSE,  SUBJECT  TO  ANNUAL APPROPRIATION BY THE LEGISLATURE. ANY SUCH
CONTRACT OR ANY PAYMENTS MADE OR TO BE MADE THEREUNDER MAY  BE  ASSIGNED
AND  PLEDGED  BY THE DORMITORY AUTHORITY AND THE CORPORATION AS SECURITY
FOR ITS BONDS AND NOTES, AS AUTHORIZED BY THIS SECTION.
  3. THE COMPTROLLER IS HEREBY AUTHORIZED TO RECEIVE FROM THE  DORMITORY
AUTHORITY  AND  THE  CORPORATION  ANY  PORTION  OF BOND PROCEEDS PAID TO
PROVIDE FUNDS FOR OR REIMBURSE THE STATE FOR ITS COSTS  ASSOCIATED  WITH
SUCH  CAPITAL  PROJECT  COSTS  AND TO CREDIT SUCH AMOUNTS TO THE CAPITAL
PROJECTS FUND OR ANY OTHER APPROPRIATE FUND.
  S 48. Subdivision (a) of section 28 of part Y of  chapter  61  of  the
laws  of  2005,  relating to providing for the administration of certain
funds and accounts related  to  the  2005-2006  budget,  as  amended  by
section  39  of  part U of chapter 59 of the laws of 2012, is amended to
read as follows:
  (a) Subject to the provisions of chapter 59 of the laws of  2000,  but
notwithstanding  any  provisions  of  law  to  the contrary, one or more
authorized issuers as defined by section 68-a of the state  finance  law
are  hereby  authorized to issue bonds or notes in one or more series in
an aggregate principal amount not to exceed  [$24,000,000]  $27,000,000,
excluding  bonds  issued  to  finance  one  or more debt service reserve
funds, to pay costs of issuance of such bonds, and bonds or notes issued
to refund or otherwise repay such bonds or notes previously issued,  for
the  purpose of financing capital projects for public protection facili-
ties in the Division of Military and Naval  Affairs,  debt  service  and
leases;  and  to reimburse the state general fund for disbursements made
therefor. Such bonds and notes of such authorized issuer shall not be  a
debt  of the state, and the state shall not be liable thereon, nor shall
they be payable out of any funds other than those  appropriated  by  the
state  to  such  authorized issuer for debt service and related expenses
pursuant to any service contract executed pursuant to subdivision (b) of
this section and such bonds and notes shall contain on the face  thereof
a  statement  to  such effect. Except for purposes of complying with the
internal revenue code, any interest income earned on bond proceeds shall
only be used to pay debt service on such bonds.
  S 49. Subdivision 1 of section 16 of part D of chapter 389 of the laws
of 1997, relating  to  the  financing  of  the  correctional  facilities
improvement  fund and the youth facility improvement fund, as amended by

S. 2609--C                         145

section 40 of part U of chapter 59 of the laws of 2012,  is  amended  to
read as follows:
  1.  Subject  to  the provisions of chapter 59 of the laws of 2000, but
notwithstanding the provisions of section 18 of section 1 of chapter 174
of the laws of 1968, the New York state urban development corporation is
hereby authorized to issue bonds, notes  and  other  obligations  in  an
aggregate principal amount not to exceed [six] SEVEN billion [eight] ONE
hundred  [sixteen] THIRTY-THREE million [eight hundred] sixty-nine thou-
sand dollars [$6,816,869,000]  $7,133,069,000,  and  shall  include  all
bonds,  notes and other obligations issued pursuant to chapter 56 of the
laws of 1983, as amended or supplemented. The proceeds  of  such  bonds,
notes  or  other  obligations shall be paid to the state, for deposit in
the correctional facilities capital improvement fund to pay for  all  or
any  portion  of  the amount or amounts paid by the state from appropri-
ations or reappropriations made to the  department  of  corrections  and
community  supervision from the correctional facilities capital improve-
ment fund for capital projects. The aggregate amount of bonds, notes  or
other obligations authorized to be issued pursuant to this section shall
exclude  bonds, notes or other obligations issued to refund or otherwise
repay bonds, notes or other obligations theretofore issued, the proceeds
of which were paid to the state for all or  a  portion  of  the  amounts
expended  by  the  state from appropriations or reappropriations made to
the department  of  corrections  and  community  supervision;  provided,
however,  that  upon any such refunding or repayment the total aggregate
principal amount of outstanding bonds, notes or other obligations may be
greater  than  [six]  SEVEN  billion  [eight]  ONE   hundred   [sixteen]
THIRTY-THREE   million   [eight  hundred]  sixty-nine  thousand  dollars
[$6,816,869,000] $7,133,069,000, only if the present value of the aggre-
gate debt service of the refunding or repayment bonds,  notes  or  other
obligations  to  be  issued  shall  not  exceed the present value of the
aggregate debt service of the bonds, notes or other obligations so to be
refunded or repaid. For the purposes hereof, the present  value  of  the
aggregate  debt  service  of  the refunding or repayment bonds, notes or
other obligations and of the aggregate debt service of the bonds,  notes
or  other  obligations  so  refunded  or  repaid, shall be calculated by
utilizing the effective interest rate  of  the  refunding  or  repayment
bonds,  notes  or other obligations, which shall be that rate arrived at
by doubling the semi-annual  interest  rate  (compounded  semi-annually)
necessary  to  discount  the  debt  service payments on the refunding or
repayment bonds, notes or other obligations from the payment dates ther-
eof to the date of issue of the refunding or repayment bonds,  notes  or
other  obligations  and  to  the  price  bid including estimated accrued
interest or proceeds received by  the  corporation  including  estimated
accrued interest from the sale thereof.
  S  50.  Paragraph  (a) of subdivision 2 of section 47-e of the private
housing finance law, as amended by section 41 of part U of chapter 59 of
the laws of 2012, is amended to read as follows:
  (a) Subject to the provisions of chapter fifty-nine of the laws of two
thousand, in order to enhance and encourage  the  promotion  of  housing
programs  and thereby achieve the stated purposes and objectives of such
housing programs, the agency shall have the power and is hereby  author-
ized  from  time  to  time to issue negotiable housing program bonds and
notes in such principal amount as shall be necessary to  provide  suffi-
cient  funds  for the repayment of amounts disbursed (and not previously
reimbursed) pursuant to law or any prior year making  capital  appropri-
ations  or  reappropriations  for  the  purposes of the housing program;

S. 2609--C                         146

provided, however, that the agency may issue such bonds and notes in  an
aggregate  principal  amount  not  exceeding  two  billion [seven] EIGHT
hundred [forty] FORTY-FOUR million [six] EIGHT hundred ninety-nine thou-
sand  dollars,  plus a principal amount of bonds issued to fund the debt
service reserve fund in accordance with the debt  service  reserve  fund
requirement  established  by  the  agency and to fund any other reserves
that the agency reasonably deems necessary for the security or  marketa-
bility  of  such  bonds and to provide for the payment of fees and other
charges and expenses,  including  underwriters'  discount,  trustee  and
rating  agency  fees,  bond  insurance, credit enhancement and liquidity
enhancement related to the issuance of such bonds and notes. No  reserve
fund securing the housing program bonds shall be entitled or eligible to
receive  state  funds apportioned or appropriated to maintain or restore
such reserve fund at or to a particular level, except to the  extent  of
any  deficiency  resulting  directly or indirectly from a failure of the
state to appropriate or pay the agreed amount under any of the contracts
provided for in subdivision four of this section.
  S 51. Subdivision (b) of section 11 of chapter  329  of  the  laws  of
1991,  amending  the  state  finance  law and other laws relating to the
establishment of the dedicated highway and bridge trust fund, as amended
by section 42 of part U of chapter 59 of the laws of 2012, is amended to
read as follows:
  (b) Any service contract or contracts for projects authorized pursuant
to sections 10-c, 10-f, 10-g and 80-b of the  highway  law  and  section
14-k of the transportation law, and entered into pursuant to subdivision
(a)  of  this  section,  shall  provide for state commitments to provide
annually to the thruway authority a sum or sums,  upon  such  terms  and
conditions as shall be deemed appropriate by the director of the budget,
to fund, or fund the debt service requirements of any bonds or any obli-
gations  of  the thruway authority issued to fund such projects having a
cost not in excess of [$7,106,022,000]  $7,516,875,000  cumulatively  by
the end of fiscal year [2012-13] 2013-14.
  S  52.  Subdivision 1 of section 1689-i of the public authorities law,
as amended by section 50 of part U of chapter 59 of the laws of 2012, is
amended to read as follows:
  1. The dormitory authority  is  authorized  to  issue  bonds,  at  the
request  of  the  commissioner of education, to finance eligible library
construction projects pursuant to section two hundred seventy-three-a of
the education law, in amounts certified  by  such  commissioner  not  to
exceed  a  total  principal  amount of [ninety-eight] ONE HUNDRED TWELVE
million dollars.
  S 53. Subdivision (a) of section 27 of part Y of  chapter  61  of  the
laws  of  2005,  providing  for  the administration of certain funds and
accounts related to the 2005-2006 budget, as amended by  section  43  of
part  PP  of  chapter  56  of  the  laws  of 2009, is amended to read as
follows:
  (a) Subject to the provisions of chapter 59 of the laws of  2000,  but
notwithstanding  any provisions of law to the contrary, the urban devel-
opment corporation is hereby authorized to issue bonds or notes  in  one
or   more  series  in  an  aggregate  principal  amount  not  to  exceed
[$114,100,000] $133,600,000, excluding bonds issued to  finance  one  or
more debt service reserve funds, to pay costs of issuance of such bonds,
and  bonds  or  notes  issued to refund or otherwise repay such bonds or
notes previously issued, for the purpose of financing  capital  projects
for  THE division of state police [facilities], debt service and leases;
and to reimburse the state general fund for disbursements made therefor.

S. 2609--C                         147

Such bonds and notes of such authorized issuer shall not be  a  debt  of
the  state, and the state shall not be liable thereon, nor shall they be
payable out of any funds other than those appropriated by the  state  to
such authorized issuer for debt service and related expenses pursuant to
any  service  contract  executed  pursuant  to  subdivision  (b) of this
section and such bonds and notes shall contain on  the  face  thereof  a
statement  to  such  effect.  Except  for purposes of complying with the
internal revenue code, any interest income earned on bond proceeds shall
only be used to pay debt service on such bonds.
  S 54. Section 44 of section 1 of chapter 174  of  the  laws  of  1968,
constituting  the  New  York state urban development corporation act, as
amended by section 43 of part U of chapter 59 of the laws  of  2012,  is
amended to read as follows:
  S  44.  ISSUANCE  OF  CERTAIN  BONDS  OR NOTES. 1. Notwithstanding the
provisions of any other law to the contrary, the dormitory authority and
the corporation are hereby authorized to issue bonds or notes in one  or
more  series  for  the purpose of funding project costs for the regional
economic development council  initiative,  the  economic  transformation
program,  state university of New York college for nanoscale and science
engineering, projects within the city of Buffalo  or  surrounding  envi-
rons,  [and]  the New York works economic development fund, PROJECTS FOR
THE RETENTION OF PROFESSIONAL FOOTBALL IN WESTERN NEW  YORK,  and  other
state  costs  associated  with  such projects.   The aggregate principal
amount of bonds authorized to be issued pursuant to this  section  shall
not  exceed [seven hundred ten million five hundred fifty] EIGHT HUNDRED
FORTY-ONE MILLION SIX HUNDRED SEVEN thousand  dollars,  excluding  bonds
issued  to  fund one or more debt service reserve funds, to pay costs of
issuance of such bonds, and bonds or notes issued to refund or otherwise
repay such bonds or notes previously issued. Such bonds and notes of the
dormitory authority and the corporation shall  not  be  a  debt  of  the
state,  and  the  state  shall  not be liable thereon, nor shall they be
payable out of any funds other than those appropriated by the  state  to
the dormitory authority and the corporation for principal, interest, and
related expenses pursuant to a service contract and such bonds and notes
shall contain on the face thereof a statement to such effect. Except for
purposes  of  complying  with  the  internal  revenue code, any interest
income earned on bond proceeds shall only be used to pay debt service on
such bonds.
  2. Notwithstanding any other provision of  law  to  the  contrary,  in
order to assist the dormitory authority and the corporation in undertak-
ing  the  financing for project costs for the regional economic develop-
ment council initiative,  the  economic  transformation  program,  state
university  of  New  York college for nanoscale and science engineering,
projects within the city of Buffalo or surrounding environs  [and],  the
New  York works economic development fund, PROJECTS FOR THE RETENTION OF
PROFESSIONAL FOOTBALL IN WESTERN NEW YORK, and other state costs associ-
ated with such projects, the director of the budget is hereby authorized
to enter into one or more service contracts with the dormitory authority
and the corporation, none of which shall exceed thirty  years  in  dura-
tion,  upon  such terms and conditions as the director of the budget and
the dormitory authority and the corporation agree,  so  as  to  annually
provide  to  the  dormitory authority and the corporation, in the aggre-
gate, a sum not to exceed the principal, interest, and related  expenses
required  for  such  bonds  and notes. Any service contract entered into
pursuant to this section shall provide that the obligation of the  state
to  pay  the  amount therein provided shall not constitute a debt of the

S. 2609--C                         148

state within the meaning of any constitutional  or  statutory  provision
and shall be deemed executory only to the extent of monies available and
that  no  liability  shall  be  incurred  by the state beyond the monies
available  for  such  purpose,  subject  to  annual appropriation by the
legislature. Any such contract or any payments made or to be made there-
under may be assigned and pledged by the  dormitory  authority  and  the
corporation  as  security for its bonds and notes, as authorized by this
section.
  S 55. Subdivision 3 of section 1285-p of the public  authorities  law,
as amended by section 38 of part U of chapter 59 of the laws of 2012, is
amended to read as follows:
  3.  The  maximum amount of bonds that may be issued for the purpose of
financing  environmental  infrastructure  projects  authorized  by  this
section  shall  be  one  billion  [one  hundred  eighteen]  TWO  HUNDRED
SIXTY-FIVE million seven hundred sixty thousand  dollars,  exclusive  of
bonds  issued to fund any debt service reserve funds, pay costs of issu-
ance of such bonds, and bonds or notes issued  to  refund  or  otherwise
repay  bonds  or  notes  previously  issued. Such bonds and notes of the
corporation shall not be a debt of the state, and the state shall not be
liable thereon, nor shall they be payable out of any  funds  other  than
those  appropriated by the state to the corporation for debt service and
related expenses pursuant to any service contracts executed pursuant  to
subdivision  one of this section, and such bonds and notes shall contain
on the face thereof a statement to such effect.
  S 56. The state finance law is amended by adding a new section 92-h to
read as follows:
  S 92-H. SALES TAX REVENUE BOND TAX FUND. 1.  THERE  IS  HEREBY  ESTAB-
LISHED IN THE JOINT CUSTODY OF THE STATE COMPTROLLER AND THE COMMISSION-
ER  OF  TAXATION AND FINANCE A FUND WITHIN THE GENERAL DEBT SERVICE FUND
TO BE KNOWN AS THE "SALES TAX REVENUE BOND TAX FUND".
  2. SUCH FUND SHALL CONSIST OF THE AMOUNT OF REVENUE  COLLECTED  WITHIN
THE  STATE  FROM  THE IMPOSITION OF THE SALES AND COMPENSATING USE TAXES
(INCLUDING INTEREST AND PENALTIES) PURSUANT TO  SECTION  ELEVEN  HUNDRED
FIVE  AND  SECTION ELEVEN HUNDRED TEN OF THE TAX LAW EQUAL TO THE AMOUNT
ATTRIBUTABLE TO A ONE PERCENT RATE OF TAXATION, LESS SUCH AMOUNTS AS THE
COMMISSIONER OF TAXATION AND FINANCE MAY DETERMINE TO BE  NECESSARY  FOR
REFUNDS.   ON AND AFTER THE DATE THAT ALL OF THE OBLIGATIONS AND LIABIL-
ITIES OF THE NEW YORK LOCAL GOVERNMENT ASSISTANCE CORPORATION SHALL HAVE
BEEN  MET  OR  OTHERWISE  DISCHARGED,  OTHER  THAN  PAYMENT  OBLIGATIONS
REQUIRED  BY  SECTION  THIRTY-TWO  HUNDRED  THIRTY-EIGHT-A OF THE PUBLIC
AUTHORITIES LAW, IT SHALL EQUAL THE AMOUNT ATTRIBUTABLE TO A TWO PERCENT
RATE OF TAXATION, LESS SUCH AMOUNTS AS THE COMMISSIONER OF TAXATION  AND
FINANCE  MAY  DETERMINE  TO  BE  NECESSARY FOR REFUNDS.   SUCH SALES AND
COMPENSATING USE TAX REVENUES SHALL BE SEPARATE AND  DISTINCT  FROM  THE
SALES  AND  COMPENSATING USE TAX REVENUES DEPOSITED FROM TIME TO TIME IN
THE  LOCAL  GOVERNMENT  ASSISTANCE  TAX  FUND,   PURSUANT   TO   SECTION
NINETY-TWO-R OF THIS CHAPTER.
  3.  ON  OR  BEFORE  THE TWELFTH DAY OF EACH MONTH, THE COMMISSIONER OF
TAXATION AND FINANCE SHALL CERTIFY TO THE STATE COMPTROLLER THE  AMOUNTS
SPECIFIED  IN  SUBDIVISION TWO OF THIS SECTION RELATING TO THE PRECEDING
MONTH AND, IN ADDITION, NO LATER THAN MARCH THIRTY-FIRST OF EACH  FISCAL
YEAR THE COMMISSIONER OF TAXATION AND FINANCE SHALL CERTIFY SUCH AMOUNTS
RELATING TO THE LAST MONTH OF SUCH FISCAL YEAR. THE AMOUNTS SO CERTIFIED
SHALL  BE  DEPOSITED  BY  THE STATE COMPTROLLER IN THE SALES TAX REVENUE
BOND TAX FUND.

S. 2609--C                         149

  4. MONEYS IN THE SALES TAX REVENUE BOND TAX FUND SHALL BE  KEPT  SEPA-
RATE AND SHALL NOT BE COMMINGLED WITH ANY OTHER MONEYS IN THE CUSTODY OF
THE  STATE COMPTROLLER AND THE COMMISSIONER OF TAXATION AND FINANCE. ALL
DEPOSITS OF SUCH REVENUES SHALL, IF REQUIRED BY THE  STATE  COMPTROLLER,
BE  SECURED BY OBLIGATIONS OF THE UNITED STATES OR OF THE STATE HAVING A
MARKET VALUE EQUAL AT ALL TIMES TO THE AMOUNT OF SUCH DEPOSITS  AND  ALL
BANKS  AND  TRUST  COMPANIES  ARE  AUTHORIZED  TO GIVE SECURITY FOR SUCH
DEPOSITS. ANY SUCH MONEYS IN SUCH FUND MAY, IN  THE  DISCRETION  OF  THE
STATE  COMPTROLLER,  BE INVESTED IN OBLIGATIONS IN WHICH THE STATE COMP-
TROLLER IS AUTHORIZED TO INVEST PURSUANT TO  SECTION  NINETY-EIGHT-A  OF
THIS ARTICLE.
  5.  (A) THE STATE COMPTROLLER SHALL FROM TIME TO TIME, BUT IN NO EVENT
LATER THAN THE FIFTEENTH DAY OF EACH MONTH (OTHER THAN  THE  LAST  MONTH
OF  THE  FISCAL YEAR) AND NO LATER THAN THE THIRTY-FIRST DAY OF THE LAST
MONTH OF EACH FISCAL YEAR, PAY OVER AND DISTRIBUTE TO THE CREDIT OF  THE
GENERAL  FUND  OF THE STATE TREASURY ALL MONEYS IN THE SALES TAX REVENUE
BOND TAX FUND, IF ANY, IN EXCESS OF THE AGGREGATE AMOUNT REQUIRED TO  BE
SET ASIDE FOR THE PAYMENT OF CASH REQUIREMENTS PURSUANT TO PARAGRAPH (B)
OF THIS SUBDIVISION, PROVIDED THAT AN APPROPRIATION HAS BEEN MADE TO PAY
ALL  AMOUNTS  SPECIFIED  IN ANY CERTIFICATE OR CERTIFICATES DELIVERED BY
THE DIRECTOR OF THE BUDGET PURSUANT TO PARAGRAPH (B) OF THIS SUBDIVISION
AS BEING REQUIRED BY ANY AUTHORIZED ISSUER AS SUCH TERM  IS  DEFINED  IN
SECTION  SIXTY-NINE-M  OF  THIS CHAPTER FOR THE PAYMENT OF CASH REQUIRE-
MENTS OF SUCH AUTHORIZED ISSUERS FOR SUCH FISCAL YEAR.   SUBJECT TO  THE
RIGHTS  OF  HOLDERS  OF  DEBT  OF THE STATE, IN NO EVENT SHALL THE STATE
COMPTROLLER PAY OVER AND DISTRIBUTE ANY MONEYS ON DEPOSIT IN  THE  SALES
TAX  REVENUE BOND TAX FUND TO ANY PERSON OTHER THAN AN AUTHORIZED ISSUER
PURSUANT TO SUCH CERTIFICATE OR CERTIFICATES (I) UNLESS  AND  UNTIL  THE
AGGREGATE OF ALL CASH REQUIREMENTS CERTIFIED TO THE STATE COMPTROLLER AS
REQUIRED  BY  SUCH  AUTHORIZED ISSUERS TO BE SET ASIDE PURSUANT TO PARA-
GRAPH (B) OF THIS SUBDIVISION FOR  SUCH  FISCAL  YEAR  SHALL  HAVE  BEEN
APPROPRIATED  TO SUCH AUTHORIZED ISSUERS IN ACCORDANCE WITH THE SCHEDULE
SPECIFIED IN THE CERTIFICATE OR CERTIFICATES FILED BY  THE  DIRECTOR  OF
THE  BUDGET OR (II) IF, AFTER HAVING BEEN SO CERTIFIED AND APPROPRIATED,
ANY PAYMENT REQUIRED TO BE MADE PURSUANT TO PARAGRAPH (B) OF THIS SUBDI-
VISION HAS NOT BEEN MADE TO THE  AUTHORIZED  ISSUERS  PURSUANT  TO  SUCH
CERTIFICATE  OR CERTIFICATES; PROVIDED, HOWEVER, THAT NO PERSON, INCLUD-
ING SUCH AUTHORIZED ISSUERS OR THE HOLDERS OF REVENUE BONDS, SHALL  HAVE
ANY  LIEN  ON  MONEYS ON DEPOSIT IN THE SALES TAX REVENUE BOND TAX FUND.
ANY AGREEMENT ENTERED INTO PURSUANT  TO  SECTION  SIXTY-NINE-O  OF  THIS
CHAPTER  RELATED  TO  ANY  PAYMENT  AUTHORIZED  BY THIS SECTION SHALL BE
EXECUTORY ONLY TO THE EXTENT OF SUCH REVENUES AVAILABLE TO THE STATE  IN
SUCH  FUND.  NOTWITHSTANDING SUBDIVISIONS TWO AND THREE OF THIS SECTION,
IN THE EVENT THE AGGREGATE OF ALL CASH  REQUIREMENTS  CERTIFIED  TO  THE
STATE COMPTROLLER AS REQUIRED BY SUCH AUTHORIZED ISSUERS TO BE SET ASIDE
PURSUANT TO PARAGRAPH (B) OF THIS SUBDIVISION FOR THE FISCAL YEAR BEGIN-
NING  ON APRIL FIRST SHALL NOT HAVE BEEN APPROPRIATED TO SUCH AUTHORIZED
ISSUERS IN ACCORDANCE WITH THE SCHEDULE SPECIFIED IN THE CERTIFICATE  OR
CERTIFICATES  FILED BY THE DIRECTOR OF THE BUDGET OR, IF, HAVING BEEN SO
CERTIFIED AND APPROPRIATED, ANY PAYMENT REQUIRED TO BE MADE PURSUANT  TO
PARAGRAPH  (B)  OF  THIS  SUBDIVISION HAS NOT BEEN MADE PURSUANT TO SUCH
CERTIFICATE OR CERTIFICATES, ALL RECEIPTS COLLECTED AND DEPOSITED IN THE
SALES TAX REVENUE BOND TAX FUND SHALL REMAIN IN SUCH FUND. NOTWITHSTAND-
ING ANY OTHER PROVISION OF LAW, IF THE STATE HAS APPROPRIATED  AND  PAID
TO  THE  AUTHORIZED  ISSUERS  ALL  AMOUNTS  NECESSARY FOR THE AUTHORIZED
ISSUERS TO MEET THEIR CASH REQUIREMENTS  FOR  THE  CURRENT  FISCAL  YEAR

S. 2609--C                         150

PURSUANT TO THE CERTIFICATE OR CERTIFICATES SUBMITTED BY THE DIRECTOR OF
THE  BUDGET  PURSUANT  TO PARAGRAPH (B) OF THIS SECTION, THE STATE COMP-
TROLLER SHALL, ON THE LAST DAY OF EACH FISCAL YEAR, PAY TO  THE  GENERAL
FUND  OF  THE STATE ALL SUMS REMAINING IN THE SALES TAX REVENUE BOND TAX
FUND ON SUCH DATE EXCEPT SUCH AMOUNTS AS THE DIRECTOR OF THE BUDGET  MAY
CERTIFY  ARE  NEEDED TO MEET THE CASH REQUIREMENTS OF AUTHORIZED ISSUERS
DURING THE SUBSEQUENT FISCAL YEAR.
  (B) NO LATER THAN THIRTY DAYS AFTER THE SUBMISSION  OF  THE  EXECUTIVE
BUDGET  IN ACCORDANCE WITH ARTICLE SEVEN OF THE CONSTITUTION, THE DIREC-
TOR OF THE BUDGET SHALL PREPARE A CERTIFICATE OF THE AMOUNT  OF  MONTHLY
RECEIPTS ANTICIPATED TO BE DEPOSITED PURSUANT TO SUBDIVISION TWO OF THIS
SECTION  DURING  THE  FISCAL  YEAR  BEGINNING  APRIL  FIRST OF THAT YEAR
TOGETHER WITH THE MONTHLY AMOUNTS NECESSARY TO BE  SET  ASIDE  FROM  THE
RECEIPTS  OF  SUCH  FUND,  AS SHALL BE SUFFICIENT TO MEET THE TOTAL CASH
REQUIREMENTS OF AUTHORIZED ISSUERS, AS DEFINED BY  SECTION  SIXTY-NINE-M
OF THIS CHAPTER DURING SUCH FISCAL YEAR, BASED ON INFORMATION THAT SHALL
BE PROVIDED BY SUCH AUTHORIZED ISSUERS, CONSISTENT WITH THE TERMS OF ANY
CONTRACT WITH OUTSTANDING BONDHOLDERS. EXCEPT FOR THE PURPOSE OF MEETING
CASH  REQUIREMENTS  OF AN AUTHORIZED ISSUER THAT ARE DUE ON A MONTHLY OR
MORE FREQUENT BASIS, PRIOR TO TRANSFERRING ANY MONEYS FROM  THE  ACCOUNT
PURSUANT TO PARAGRAPH (A) OF THIS SUBDIVISION, THE COMPTROLLER SHALL SET
ASIDE  ON A MONTHLY BASIS ALL REVENUES DEPOSITED PURSUANT TO THIS SUBDI-
VISION AS RECEIVED UNTIL THE AMOUNT SET ASIDE IS EQUAL TO  ONE-FIFTH  OF
THE  INTEREST  DUE  ON  SUCH OBLIGATIONS ON THE NEXT SUCCEEDING INTEREST
PAYMENT DATE MULTIPLIED BY THE NUMBER  OF  MONTHS  FROM  THE  LAST  SUCH
PAYMENT  AND  ONE-ELEVENTH OF THE NEXT PRINCIPAL INSTALLMENT DUE ON SUCH
OBLIGATIONS MULTIPLIED BY THE NUMBER OF MONTHS FROM THE LAST SUCH  PRIN-
CIPAL INSTALLMENT WHERE PRINCIPAL IS DUE ON AN ANNUAL BASIS OR ONE-FIFTH
OF  THE NEXT PRINCIPAL INSTALLMENT DUE ON SUCH OBLIGATIONS MULTIPLIED BY
THE NUMBER OF MONTHS FROM THE  LAST  SUCH  PRINCIPAL  INSTALLMENT  WHERE
PRINCIPAL  IS DUE ON A SEMIANNUAL BASIS. FOR THE PURPOSE OF MEETING CASH
REQUIREMENTS OF AN AUTHORIZED ISSUER THAT ARE DUE ON A MONTHLY BASIS  OR
MORE  FREQUENTLY, THE COMPTROLLER SHALL SET ASIDE ALL REVENUES DEPOSITED
PURSUANT TO SUBDIVISION TWO OF THIS SECTION AS RECEIVED UNTIL THE AMOUNT
SO SET ASIDE IS, IN THE REASONABLE JUDGMENT OF THE DIRECTOR OF THE BUDG-
ET AS SET FORTH IN SUCH CERTIFICATE, SUFFICIENT  TO  MAKE  THE  REQUIRED
PAYMENT  ON  OR  BEFORE  SUCH  PAYMENT DATE. NOTWITHSTANDING SUBDIVISION
THREE OF, SECTION SEVENTY-TWO OF THIS ARTICLE OR ANY OTHER PROVISION  OF
LAW, ALL MONEYS SET ASIDE IN THE SALES TAX REVENUE BOND TAX FUND TO MEET
THE ANNUAL CASH REQUIREMENTS OF AUTHORIZED ISSUERS PURSUANT TO A CERTIF-
ICATE  OR CERTIFICATES AS REQUIRED IN THIS PARAGRAPH SHALL REMAIN IN THE
SALES TAX REVENUE BOND TAX FUND UNTIL NEEDED FOR PAYMENT  TO  AUTHORIZED
ISSUERS,  AS  PROVIDED IN THIS SECTION. IN THE EVENT THAT THE AMOUNT SET
ASIDE BY THE STATE COMPTROLLER PURSUANT TO THIS PARAGRAPH IS NOT  SUFFI-
CIENT  TO  MEET THE CASH REQUIREMENTS REQUIRED PURSUANT TO A CERTIFICATE
OR CERTIFICATES SUBMITTED BY THE DIRECTOR OF THE BUDGET, THE STATE COMP-
TROLLER SHALL IMMEDIATELY TRANSFER FROM THE GENERAL FUND  TO  THE  SALES
TAX REVENUE BOND TAX FUND AN AMOUNT WHICH, WHEN COMBINED WITH THE AMOUNT
SET  ASIDE  PURSUANT  TO THIS PARAGRAPH, SHALL BE SUFFICIENT TO MEET THE
PAYMENT REQUIRED PURSUANT  TO  SUCH  CERTIFICATE  OR  CERTIFICATES.  THE
DIRECTOR  OF  THE  BUDGET MAY REVISE SUCH CERTIFICATION AT SUCH TIMES AS
SHALL BE NECESSARY, PROVIDED, HOWEVER, THAT THE DIRECTOR OF  THE  BUDGET
SHALL,  AS  NECESSARY,  REVISE  SUCH CERTIFICATION NOT LATER THAN THIRTY
DAYS AFTER THE ISSUANCE OF ANY REVENUE BONDS, INCLUDING REFUNDING BONDS,
AND AFTER THE ADOPTION OF ANY INTEREST RATE EXCHANGE OR OTHER  FINANCIAL
ARRANGEMENT  AFFECTING THE CASH REQUIREMENTS  OF THE AUTHORIZED ISSUERS.

S. 2609--C                         151

IN NO EVENT SHALL THE STATE COMPTROLLER BE  HELD LIABLE FOR THE  FAILURE
TO  SET  ASIDE  AN  AMOUNT  SUFFICIENT TO PAY ANY REQUIRED PAYMENT OF AN
AUTHORIZED ISSUER.
  6. ALL PAYMENTS OF MONEYS FROM THE REVENUE BOND TAX FUND SHALL BE MADE
ON THE AUDIT AND WARRANT OF THE STATE COMPTROLLER.
  S 57. Section 1148 of the tax law, as amended by chapter 3 of the laws
of 2004, is amended to read as follows:
  S  1148.  Deposit  and disposition of revenue. All taxes, interest and
penalties collected or received by the commissioner under  this  article
shall be deposited and disposed of pursuant to the provisions of section
one  hundred  seventy-one-a of this chapter; provided however, the comp-
troller shall on or before the twelfth day of each month, pay  all  such
taxes, interest and penalties collected under this article and remaining
to  the  comptroller's  credit  in  such  banks, banking houses or trust
companies at the close of business on the  last  day  of  the  preceding
month,  into the general fund of the state treasury, except as otherwise
provided in sections ninety-two-d, NINETY-TWO-H, and ninety-two-r of the
state finance law and sections eleven hundred two, eleven  hundred  four
and eleven hundred nine of this article.
  S  58. The state finance law is amended by adding a new article 5-F to
read as follows:
                               ARTICLE 5-F
                SALES TAX REVENUE BOND FINANCING PROGRAM
SECTION 69-M. DEFINITIONS.
        69-N. ISSUANCE OF BONDS AND NOTES.
        69-O. PAYMENTS TO AUTHORIZED ISSUERS.
  S 69-M. DEFINITIONS. 1. "AUTHORIZED ISSUER" SHALL MEAN  THE  DORMITORY
AUTHORITY OF THE STATE OF NEW YORK, THE NEW YORK STATE URBAN DEVELOPMENT
CORPORATION,  THE  NEW  YORK STATE THRUWAY AUTHORITY, AND ANY SUCCESSORS
THERETO.
  2. "AUTHORIZED PURPOSE" FOR PURPOSES OF THIS ARTICLE AND SECTION NINE-
TY-TWO-H OF THIS CHAPTER SHALL MEAN ANY PURPOSES  FOR  WHICH  STATE-SUP-
PORTED DEBT, AS DEFINED BY SECTION SIXTY-SEVEN-A OF THIS CHAPTER, MAY OR
HAS  BEEN  ISSUED,  EXCEPT  DEBT FOR WHICH THE STATE IS CONSTITUTIONALLY
OBLIGATED THEREUNDER TO PAY DEBT SERVICE AND RELATED EXPENSES.
  3. "REVENUE BONDS" FOR THE PURPOSES OF THIS ARTICLE AND SECTION  NINE-
TY-TWO-H  OF  THIS  CHAPTER  SHALL  MEAN ANY BONDS, NOTES OR OBLIGATIONS
ISSUED OR INCURRED PURSUANT TO SECTION SIXTY-NINE-N OF THIS ARTICLE.
  S 69-N. ISSUANCE OF BONDS AND NOTES.  1. (A) AUTHORIZED ISSUERS  SHALL
HAVE  THE  POWER  AND  ARE  HEREBY AUTHORIZED FROM TIME TO TIME TO ISSUE
REVENUE BONDS, IN SUCH PRINCIPAL AMOUNT OR AMOUNTS, SUBJECT TO  SUBDIVI-
SION  EIGHT  OF  THIS  SECTION  AND  AS THE DIRECTOR OF THE BUDGET SHALL
DETERMINE TO BE NECESSARY, TO PROVIDE SUFFICIENT  FUNDS  FOR  AUTHORIZED
PURPOSES,  THE  ESTABLISHMENT  OF RESERVES TO SECURE SUCH REVENUE BONDS,
THE PAYMENT OF AMOUNTS REQUIRED UNDER REVENUE BONDS OR AGREEMENTS RELAT-
ING THERETO, AND THE PAYMENT OF ALL COSTS OF ISSUANCE OF  THEIR  REVENUE
BONDS.
  (B) THE AUTHORIZED ISSUERS SHALL HAVE THE POWER AND ARE HEREBY AUTHOR-
IZED  FROM  TIME TO TIME TO ISSUE (I) REVENUE BONDS TO RENEW NOTES, (II)
REVENUE BONDS TO PAY NOTES, AND (III) WHENEVER IT DEEMS REFUNDING  EXPE-
DIENT,  TO  REFUND  ANY  BONDS, NOTES OR OTHER OBLIGATIONS ISSUED FOR AN
AUTHORIZED PURPOSE OR PURPOSES, INCLUDING BONDS, NOTES  OR  OTHER  OBLI-
GATIONS THAT WERE ISSUED PRIOR TO THE EFFECTIVE DATE OF THIS ARTICLE, BY
THE  ISSUANCE  OF  NEW REVENUE BONDS, WHETHER THE BONDS, NOTES, OR OTHER
OBLIGATIONS TO BE REFUNDED HAVE OR HAVE NOT MATURED, AND TO ISSUE REVEN-
UE BONDS IN PART TO REFUND  BONDS,  NOTES,  OR  OTHER  OBLIGATIONS  THEN

S. 2609--C                         152

OUTSTANDING  AND  IN  PART FOR ANY OF ITS OTHER AUTHORIZED PURPOSES. THE
REFUNDING REVENUE BONDS MAY BE EXCHANGED  FOR  BONDS,  NOTES,  OR  OTHER
OBLIGATIONS  TO  BE  REFUNDED,  OR  SOLD AND THE PROCEEDS APPLIED TO THE
PURCHASE,  REDEMPTION  OR  PAYMENT  OF SUCH BONDS, NOTES, OR OTHER OBLI-
GATIONS.
  (C) EXCEPT AS MAY OTHERWISE BE EXPRESSLY  PROVIDED  BY  AN  AUTHORIZED
ISSUER, EVERY ISSUE OF REVENUE BONDS OF AN AUTHORIZED ISSUER PURSUANT TO
THIS SECTION SHALL BE SPECIAL OBLIGATIONS OF THE AUTHORIZED ISSUER PAYA-
BLE  SOLELY OUT OF ANY REVENUES PAID OVER TO SUCH AUTHORIZED ISSUER FROM
THE SALES TAX REVENUE BOND TAX FUND, ESTABLISHED PURSUANT    TO  SECTION
NINETY-TWO-H OF THIS CHAPTER.
  (D)  ALL  OF  THE  PROVISIONS  OF  THE ENABLING ACTS OF THE AUTHORIZED
ISSUERS RELATING TO BONDS AND NOTES, WHICH ARE NOT INCONSISTENT WITH THE
PROVISIONS OF THIS SECTION, MAY, AT THE DISCRETION OF  THE    AUTHORIZED
ISSUER, APPLY TO REVENUE BONDS AUTHORIZED BY THIS SECTION.
  (E)  THE  REVENUE  BONDS  OF THE AUTHORIZED ISSUERS AUTHORIZED BY THIS
SECTION SHALL NOT BE A DEBT OF THE STATE AND  THE  STATE  SHALL  NOT  BE
LIABLE  THEREON,  NOR  SHALL THEY BE PAYABLE OUT OF ANY FUNDS OTHER THAN
THOSE OF THE AUTHORIZED ISSUERS PLEDGED THEREFOR; AND SUCH REVENUE BONDS
SHALL CONTAIN ON THE FACE THEREOF A STATEMENT TO SUCH EFFECT.  IN  ADDI-
TION,  ANY  AGREEMENTS  ENTERED  INTO BY ANY ENTITY PURSUANT TO SECTIONS
SIXTY-NINE-O AND NINETY-TWO-H OF THIS CHAPTER ON BEHALF OF THE STATE  TO
EFFECT  THE IMPLEMENTATION OF ANY OF THE ACTIVITIES FINANCED IN WHOLE OR
IN PART WITH PROCEEDS OF THE REVENUE BONDS OF  THE  AUTHORIZED  ISSUERS,
AUTHORIZED  IN  THIS  SECTION  DO NOT CONSTITUTE OR CREATE A DEBT OF THE
STATE, NOR A CONTRACTUAL OBLIGATION IN EXCESS OF THE  AMOUNTS  APPROPRI-
ATED THEREFOR, AND THE STATE HAS NO CONTINUING LEGAL OR MORAL OBLIGATION
TO APPROPRIATE MONEY FOR PAYMENTS DUE UNDER ANY SUCH AGREEMENT.
  (F) (I) REVENUE BONDS SHALL BE AUTHORIZED BY RESOLUTION OF THE AUTHOR-
IZED  ISSUERS,  BE  IN  SUCH  DENOMINATIONS, BEAR SUCH DATE OR DATES AND
MATURE AT SUCH TIME OR TIMES, AS SUCH RESOLUTION OR OTHER AGREEMENT  MAY
PROVIDE.
  (II)  REVENUE BONDS SHALL BE SUBJECT TO SUCH TERMS OF REDEMPTION, BEAR
INTEREST AT SUCH RATE OR RATES, BE PAYABLE AT SUCH  TIMES,  BE  IN  SUCH
FORM, EITHER COUPON, REGISTERED OR BOOK ENTRY FORM, CARRY SUCH REGISTRA-
TION  PRIVILEGES,  BE EXECUTED IN SUCH MANNER, BE PAYABLE IN SUCH MEDIUM
OF PAYMENT AT SUCH PLACE OR PLACES, AND BE SUBJECT  TO  SUCH  TERMS  AND
CONDITIONS AS SUCH RESOLUTION MAY PROVIDE.
  (G)  REVENUE  BONDS  AUTHORIZED  HEREUNDER SHALL BE SOLD BY AUTHORIZED
ISSUERS, AT PUBLIC OR PRIVATE SALE, AT  SUCH  PRICE  OR  PRICES  AS  THE
AUTHORIZED  ISSUERS  MAY  DETERMINE.  REVENUE  BONDS  OF  THE AUTHORIZED
ISSUERS SHALL NOT BE SOLD BY THE AUTHORIZED  ISSUERS  AT  PRIVATE  SALES
UNLESS  SUCH  SALE AND THE TERMS THEREOF HAVE BEEN APPROVED BY THE STATE
COMPTROLLER.
  2. CONSISTENT WITH THE PROVISIONS OF THIS ARTICLE, AND SUBJECT TO  THE
APPROVAL  OF  THE DIRECTOR OF THE BUDGET, ANY RESOLUTION OR OTHER AGREE-
MENT  AUTHORIZING  REVENUE  BONDS  OR  ANY  ISSUE  THEREOF  MAY  CONTAIN
PROVISIONS, WHICH SHALL BE A PART OF THE CONTRACT WITH THE HOLDERS THER-
EOF, AS TO:
  (A)  PLEDGING  ALL OR ANY PART OF THE REVENUES RECEIVED BY THE AUTHOR-
IZED ISSUERS PURSUANT TO SECTION SIXTY-NINE-O OF THIS ARTICLE TO  SECURE
THE  PAYMENT  OF  THE BONDS OR NOTES OR OF ANY ISSUE THEREOF, SUBJECT TO
SUCH AGREEMENTS WITH HOLDERS OF REVENUE BONDS AS MAY THEN EXIST;
  (B) PLEDGING ALL OR ANY PART OF THE ASSETS OF THE  AUTHORIZED  ISSUERS
TO  SECURE  THE  PAYMENT OF THE REVENUE BONDS OR OF ANY ISSUE OF REVENUE

S. 2609--C                         153

BONDS SUBJECT TO SUCH AGREEMENTS WITH HOLDERS OF REVENUE  BONDS  AS  MAY
THEN EXIST;
  (C)  THE SETTING ASIDE OF RESERVES OR SINKING FUNDS AND THE REGULATION
AND DISPOSITION THEREOF;
  (D) LIMITATIONS ON THE PURPOSES TO  WHICH  THE  PROCEEDS  OF  SALE  OF
REVENUE  BONDS,  MAY BE APPLIED AND PLEDGING SUCH PROCEEDS TO SECURE THE
PAYMENT OF THE REVENUE BONDS OR OF ANY ISSUE THEREOF;
  (E) LIMITATIONS ON THE ISSUANCE OF ADDITIONAL REVENUE BONDS, THE TERMS
UPON WHICH ADDITIONAL REVENUE BONDS MAY BE ISSUED AND  SECURED  AND  THE
REFUNDING OF OUTSTANDING OR OTHER REVENUE BONDS;
  (F)  THE  PROCEDURE,  IF  ANY, BY WHICH THE TERMS OF ANY CONTRACT WITH
HOLDERS OF REVENUE BONDS MAY BE AMENDED  OR  ABROGATED,  THE  AMOUNT  OF
REVENUE  BONDS  THE HOLDERS OF WHICH MUST CONSENT THERETO AND THE MANNER
IN WHICH SUCH CONSENT MAY BE GIVEN;
  (G) VESTING IN A TRUSTEE, AS DESCRIBED  IN  SUBDIVISION  SIX  OF  THIS
SECTION,  SUCH  PROPERTY,  RIGHTS,  POWERS  AND  DUTIES  IN TRUST AS THE
AUTHORIZED ISSUERS MAY DETERMINE, WHICH MAY INCLUDE ANY OR  ALL  OF  THE
RIGHTS,  POWERS  AND  DUTIES  OF THE TRUSTEE APPOINTED BY THE HOLDERS OF
REVENUE BONDS OF THE RESPECTIVE  AUTHORIZED  ISSUERS  PURSUANT  TO  THIS
ARTICLE, AND LIMITING OR ABROGATING THE RIGHT OF SUCH REVENUE BOND HOLD-
ERS  TO  APPOINT  A  TRUSTEE  UNDER  THIS  TITLE OR LIMITING THE RIGHTS,
POWERS, AND DUTIES OF SUCH TRUSTEE;
  (H) THE ACTS OR OMISSIONS TO ACT WHICH SHALL CONSTITUTE A  DEFAULT  IN
THE  OBLIGATIONS  AND DUTIES OF THE AUTHORIZED ISSUERS TO THE HOLDERS OF
THE REVENUE BONDS AND PROVIDING FOR THE RIGHTS AND REMEDIES OF THE HOLD-
ERS OF THE REVENUE BONDS IN EVENT OF SUCH DEFAULT, INCLUDING  THE  RIGHT
TO  APPOINTMENT  OF  A RECEIVER; PROVIDED, HOWEVER, THAT SUCH RIGHTS AND
REMEDIES SHALL NOT BE INCONSISTENT WITH THE  OTHER  PROVISIONS  OF  THIS
ARTICLE;
  (I)  ANY  OTHER  MATTERS, OF LIKE OR DIFFERENT CHARACTER, WHICH IN ANY
WAY AFFECT THE SECURITY OR PROTECTION OF  THE  HOLDERS  OF  THE  REVENUE
BONDS; AND
  (J) THE APPLICATION OF ANY OF THE FOREGOING PROVISIONS TO ANY PROVIDER
OF ANY APPLICABLE BOND, NOTE OR OTHER FINANCIAL FACILITY.
  NOTWITHSTANDING  THE  FOREGOING,  THE  AUTHORIZED ISSUERS SHALL NOT BE
AUTHORIZED TO MAKE ANY COVENANT, PLEDGE, PROMISE, OR AGREEMENT  PURPORT-
ING  TO  BIND  THE  STATE EXCEPT AS OTHERWISE SPECIFICALLY AUTHORIZED BY
THIS ARTICLE.
  3. ANY PLEDGE MADE BY THE RESPECTIVE AUTHORIZED ISSUERS SHALL BE VALID
AND BINDING FROM THE TIME WHEN THE PLEDGE IS MADE. THE REVENUES OR PROP-
ERTY SO PLEDGED AND THEREAFTER RECEIVED  BY  THE  RESPECTIVE  AUTHORIZED
ISSUERS  SHALL IMMEDIATELY BE SUBJECT TO THE LIEN OF SUCH PLEDGE WITHOUT
ANY PHYSICAL DELIVERY THEREOF OR FURTHER ACT, AND THE LIEN OF  ANY  SUCH
PLEDGE  SHALL  BE VALID AND BINDING AS AGAINST ALL PARTIES HAVING CLAIMS
OF ANY KIND IN TORT, CONTRACT  OR  OTHERWISE    AGAINST  THE  RESPECTIVE
AUTHORIZED  ISSUERS,  IRRESPECTIVE  OF  WHETHER SUCH PARTIES HAVE NOTICE
THEREOF. NEITHER THE RESOLUTION NOR ANY  OTHER  INSTRUMENT  BY  WHICH  A
PLEDGE IS CREATED NEED BE RECORDED OR FILED TO PROTECT SUCH PLEDGE.
  4.  NEITHER THE DIRECTORS OR MEMBERS OF THE AUTHORIZED ISSUERS NOR ANY
OTHER PERSON EXECUTING THE REVENUE BONDS OF THE AUTHORIZED ISSUERS SHALL
BE LIABLE PERSONALLY THEREON OR BE SUBJECT TO ANY PERSONAL LIABILITY  OR
ACCOUNTABILITY SOLELY BY REASON OF THE ISSUANCE THEREOF.
  5.  THE AUTHORIZED ISSUERS, SUBJECT TO SUCH AGREEMENTS WITH HOLDERS OF
REVENUE BONDS AS MAY THEN EXIST, OR WITH THE PROVIDERS OF ANY APPLICABLE
BOND OR NOTE OR OTHER FINANCIAL OR AGREEMENT FACILITY, SHALL HAVE  POWER
OUT  OF  ANY  FUNDS  AVAILABLE THEREFOR TO PURCHASE REVENUE BONDS OF THE

S. 2609--C                         154

AUTHORIZED ISSUERS, WHICH MAY OR MAY NOT THEREUPON  BE  CANCELED,  AT  A
PRICE NOT EXCEEDING:
  (A)  IF  THE  REVENUE  BONDS ARE THEN REDEEMABLE, THE REDEMPTION PRICE
THEN APPLICABLE, INCLUDING ANY ACCRUED INTEREST;
  (B) IF THE REVENUE BONDS ARE NOT THEN REDEEMABLE, THE REDEMPTION PRICE
AND ACCRUED INTEREST APPLICABLE ON THE FIRST DATE  AFTER  SUCH  PURCHASE
UPON WHICH THE REVENUE BONDS BECOME SUBJECT TO REDEMPTION.
  6.  IN  THE DISCRETION OF AUTHORIZED ISSUERS, THE REVENUE BONDS MAY BE
SECURED BY A TRUST INDENTURE BY AND BETWEEN THE AUTHORIZED ISSUERS AND A
CORPORATE TRUSTEE, OR A CORPORATE TRUSTEE MAY  BE  APPOINTED  UNDER  THE
RESOLUTION AS PROVIDED IN SUBDIVISION TWO OF THIS SECTION.
  7.  WHETHER OR NOT THE REVENUE BONDS ARE OF SUCH FORM AND CHARACTER AS
TO BE NEGOTIABLE INSTRUMENTS UNDER THE TERMS OF THE  UNIFORM  COMMERCIAL
CODE,  THE  REVENUE  BONDS ARE HEREBY MADE NEGOTIABLE INSTRUMENTS WITHIN
THE MEANING OF AND FOR ALL PURPOSES  OF  THE  UNIFORM  COMMERCIAL  CODE,
SUBJECT  ONLY TO THE PROVISIONS OF THE REVENUE BONDS FOR REGISTRATION OR
ANY BOOK-ENTRY-ONLY SYSTEM.
  8. REVENUE BONDS MAY  ONLY  BE  ISSUED  FOR  AUTHORIZED  PURPOSES,  AS
DEFINED  IN  SECTION  SIXTY-NINE-M  OF THIS ARTICLE. NOTWITHSTANDING THE
FOREGOING, ANY AUTHORIZED ISSUER MAY ISSUE REVENUE BONDS FOR ANY AUTHOR-
IZED PURPOSE. THE AUTHORIZED ISSUERS SHALL NOT ISSUE ANY  REVENUE  BONDS
IN  AN  AMOUNT IN EXCESS OF STATUTORY AUTHORIZATIONS FOR SUCH AUTHORIZED
PURPOSES. AUTHORIZATIONS FOR SUCH AUTHORIZED PURPOSES SHALL  BE  REDUCED
IN  AN  AMOUNT  EQUAL  TO  THE  AMOUNT  OF REVENUE BONDS ISSUED FOR SUCH
AUTHORIZED PURPOSES UNDER THIS ARTICLE. SUCH REDUCTION SHALL NOT BE MADE
IN RELATION TO REVENUE BONDS ISSUED TO FUND RESERVE FUNDS, IF  ANY,  AND
COSTS OF ISSUANCE, IF THESE ITEMS ARE NOT COUNTED UNDER EXISTING AUTHOR-
IZATIONS,  NOR  SHALL  REVENUE BONDS ISSUED TO REFUND BONDS ISSUED UNDER
EXISTING AUTHORIZATIONS REDUCE THE AMOUNT OF SUCH  AUTHORIZATIONS.
  9. EXCEPT UPON THE AMENDMENT OF THE NEW YORK STATE CONSTITUTION ALLOW-
ING THE ISSUANCE OR ASSUMPTION OF  BONDS,  NOTES  OR  OTHER  OBLIGATIONS
SECURED  BY  REVENUES,  WHICH  MAY INCLUDE THE REVENUES SECURING REVENUE
BONDS OF AUTHORIZED ISSUERS, AND  THE  AFFIRMATIVE  ASSUMPTION  OF  SUCH
BONDS, NOTES OR OTHER OBLIGATIONS BY THE STATE, THE REVENUE BONDS OF THE
AUTHORIZED ISSUERS AUTHORIZED BY THIS SECTION SHALL NOT BE A DEBT OF THE
STATE AND THE STATE SHALL NOT BE LIABLE THEREON, NOR SHALL THEY BE PAYA-
BLE  OUT OF ANY FUNDS OTHER THAN THOSE OF THE AUTHORIZED ISSUERS PLEDGED
THEREFOR; AND SUCH REVENUE BONDS SHALL CONTAIN ON  THE  FACE  THEREOF  A
STATEMENT  TO  SUCH  EFFECT. IN ADDITION, ANY AGREEMENTS ENTERED INTO BY
ANY ENTITY PURSUANT TO SECTIONS SIXTY-NINE-O AND  NINETY-TWO-H  OF  THIS
CHAPTER  ON  BEHALF  OF THE STATE TO EFFECT THE IMPLEMENTATION OF ANY OF
THE ACTIVITIES FINANCED IN WHOLE OR IN PART WITH PROCEEDS OF  THE  OBLI-
GATIONS  OF  THE  AUTHORIZED  ISSUERS  AUTHORIZED IN THIS SECTION DO NOT
CONSTITUTE OR CREATE A DEBT OF THE STATE, NOR A  CONTRACTUAL  OBLIGATION
IN  EXCESS  OF  THE  AMOUNTS  APPROPRIATED THEREFOR AND THE STATE HAS NO
CONTINUING LEGAL OR MORAL OBLIGATION TO APPROPRIATE MONEY  FOR  PAYMENTS
DUE UNDER ANY SUCH AGREEMENT.
  10.  NOTHING IN THIS ARTICLE SHALL AFFECT THE AUTHORITY OF EACH OF THE
AUTHORIZED ISSUERS TO ISSUE  OR  INCUR  INDEBTEDNESS  FOR  ANY  PURPOSES
OTHERWISE  AUTHORIZED BY LAW AND NOTHING IN THIS ARTICLE SHALL BE DEEMED
TO ALTER OR AFFECT THE RIGHTS OF OUTSTANDING BONDHOLDERS OR  NOTEHOLDERS
OF ANY AUTHORIZED ISSUER.
  11.  THE AUTHORIZATION, SALE AND ISSUANCE OF REVENUE BONDS PURSUANT TO
THIS  SECTION  SHALL  NOT BE DEEMED AN ACTION AS SUCH TERM IS DEFINED IN
ARTICLE EIGHT OF THE ENVIRONMENTAL CONSERVATION LAW FOR THE PURPOSES  OF
SUCH  ARTICLE.  SUCH EXEMPTION SHALL BE STRICTLY LIMITED IN ITS APPLICA-

S. 2609--C                         155

TION TO SUCH FINANCING ACTIVITIES OF THE  AUTHORIZED  ISSUERS  HEREUNDER
AND DOES NOT EXEMPT ANY OTHER ENTITY FROM COMPLIANCE WITH  SUCH ARTICLE.
  S  69-O.  PAYMENTS TO AUTHORIZED ISSUERS. 1. THE STATE, ACTING THROUGH
THE DIRECTOR OF THE BUDGET,  AND  AUTHORIZED  ISSUERS  MAY  ENTER  INTO,
AMEND, MODIFY OR RESCIND ONE OR MORE FINANCING  AGREEMENTS PROVIDING FOR
THE  SPECIFIC  MANNER,  TIMING,  AND AMOUNT OF PAYMENTS TO BE MADE UNDER
THIS SECTION, BUT ONLY IN CONFORMITY WITH THIS SECTION.
  2. NO LATER THAN OCTOBER FIRST OF EACH  YEAR,  THE  AUTHORITY  ISSUERS
SHALL  CERTIFY  TO  THE  DIRECTOR  OF  THE  BUDGET  THE ANTICIPATED CASH
REQUIREMENTS RELATED TO REVENUE BONDS DURING THE SUBSEQUENT STATE FISCAL
YEAR IN SUCH DETAIL AS THE DIRECTOR MAY REQUIRE.
  3. UPON RECEIPT OF A VOUCHER FROM  ANY  AUTHORIZED  ISSUER  REQUESTING
PAYMENT  FOR  SUCH  AMOUNT  OR  AMOUNTS CERTIFIED BY THE DIRECTOR OF THE
BUDGET PURSUANT TO PARAGRAPH (A) OF SUBDIVISION FIVE OF SECTION  NINETY-
TWO-H  OF  THIS  CHAPTER, THE STATE COMPTROLLER SHALL PAY SUCH AMOUNT OR
AMOUNTS TO BE AUTHORIZED ISSUER FROM APPROPRIATIONS FOR SUCH PURPOSE.
  4. THE AGREEMENT OF THE STATE  CONTAINED  IN  THIS  SECTION  SHALL  BE
DEEMED  EXECUTORY  ONLY  TO  THE  EXTENT OF APPROPRIATIONS AVAILABLE FOR
PAYMENTS UNDER THIS SECTION, AND NO LIABILITY ON  ACCOUNT  OF  ANY  SUCH
PAYMENT SHALL BE INCURRED BY THE STATE BEYOND SUCH APPROPRIATIONS.
  5.  NOTHING  CONTAINED IN THIS ARTICLE SHALL BE DEEMED TO RESTRICT THE
RIGHT OF THE STATE TO AMEND, REPEAL, MODIFY OR OTHERWISE ALTER  STATUTES
IMPOSING  OR  RELATING  TO  THE TAXES IMPOSED PURSUANT TO SECTION ELEVEN
HUNDRED FIVE AND SECTION ELEVEN HUNDRED TEN OF THE TAX LAW. THE  AUTHOR-
IZED ISSUERS SHALL NOT INCLUDE WITHIN ANY RESOLUTION, CONTRACT OR AGREE-
MENT  WITH  HOLDERS  OF  THE REVENUE BONDS ISSUED UNDER THIS ARTICLE ANY
PROVISION WHICH PROVIDES THAT A DEFAULT OCCURS AS A RESULT OF THE  STATE
EXERCISING  ITS  RIGHT  TO  AMEND, REPEAL, MODIFY OR OTHERWISE ALTER THE
TAXES IMPOSED PURSUANT TO SECTION ELEVEN HUNDRED FIVE AND SECTION ELEVEN
HUNDRED TEN OF THE TAX LAW.
  6. ANY RESOLUTION OR OTHER AGREEMENT AUTHORIZING REVENUE  BONDS  UNDER
THIS ARTICLE SHALL RESERVE THE RIGHT OF THE STATE, UPON AMENDMENT OF THE
NEW  YORK  STATE  CONSTITUTION  ALLOWING  THE  ISSUANCE OR ASSUMPTION OF
BONDS, NOTES OR OTHER OBLIGATIONS SECURED BY REVENUES, WHICH MAY INCLUDE
THE REVENUES SECURING REVENUE BONDS OF AUTHORIZED ISSUERS (A) TO ASSUME,
IN WHOLE OR IN PART, REVENUE BONDS OF THE  AUTHORIZED  ISSUERS,  (B)  TO
EXTINGUISH  THE EXISTING LIEN OF SUCH RESOLUTION, OR OTHER AGREEMENT AND
(C) TO SUBSTITUTE SECURITY FOR  THE  REVENUE  BONDS  OF  THE  AUTHORIZED
ISSUERS, IN EACH CASE ONLY SO LONG AS SUCH ASSUMPTION, EXTINGUISHMENT OR
SUBSTITUTION  IS DONE IN ACCORDANCE WITH SUCH RESOLUTION OR OTHER AGREE-
MENT.
  S 59. Subdivision 8 of section 97-f of the state finance law, as added
by section 56-b of part PP of chapter 56 of the laws of 2009, is amended
to read as follows:
  8. In addition to the amounts required to be maintained on deposit  in
the  mental  health  services  fund pursuant to subdivision five of this
section, the fund shall maintain on deposit an amount equal to the  debt
service and other cash requirements on mental health services facilities
bonds issued by [the dormitory authority] AUTHORIZED ISSUERS pursuant to
[section]  SECTIONS  sixty-eight-b AND SIXTY-NINE-N of this chapter. The
amount required to be maintained  in  such  fund  shall  be  (i)  twenty
percent  of the amount of the next payment coming due relating to mental
health services facilities bonds issued by an authorized  issuer  multi-
plied  by  the  number  of months from the date of the last such payment
with respect to payments required to be made  semi-annually,  plus  (ii)
those  amounts  specified  in any financing agreement between the issuer

S. 2609--C                         156

and the state, acting through the director of the budget,  with  respect
to  payments required to be made other than semi-annually, including for
variable rate bonds, interest rate exchange  or  similar  agreements  or
other financing arrangements permitted by law.  Prior to making any such
payment,  the  comptroller shall make and deliver to the director of the
budget and the chairmen of the facilities  development  corporation  and
the New York state medical care facilities finance agency, a certificate
stating  the  aggregate amount to be maintained on deposit in the mental
health services fund to comply in  full  with  the  provisions  of  this
subdivision.
  No  later  than five days prior to the payment to be made by the state
comptroller on such mental health services facilities bonds pursuant  to
[section]  SECTIONS  ninety-two-z  AND NINETY-TWO-H of this article, the
amount of such payment shall be transferred  by  the  state  comptroller
from the mental health services fund to the revenue bond tax fund estab-
lished  by  section  ninety-two-z  of  this article. The accumulation of
moneys pursuant to this  subdivision  and  subsequent  transfer  to  the
revenue  bond  tax fund shall be subordinate in all respects to payments
to be made to the New York state medical care facilities finance  agency
and  to  any  pledge  or  assignment pursuant to subdivision six of this
section.
  S 60. Paragraph a of subdivision  5  of  section  89-b  of  the  state
finance law, as amended by section 1 of part B of chapter 84 of the laws
of 2002, is amended to read as follows:
  a.  Moneys  in  the  dedicated  highway  and  bridge trust fund shall,
following appropriation by the legislature, be  utilized  for:    recon-
struction,  replacement, reconditioning, restoration, rehabilitation and
preservation of state, county, town, city and village  roads,  highways,
parkways,  and  bridges  thereon,  to  restore  such facilities to their
intended  functions;  construction,  reconstruction,   enhancement   and
improvement  of  state, county, town, city, and village roads, highways,
parkways, and bridges thereon, to address current and projected capacity
problems including costs for  traffic  mitigation  activities;  aviation
projects authorized pursuant to section fourteen-j of the transportation
law  and  for payments to the general debt service fund of amounts equal
to amounts required for service contract payments  related  to  aviation
projects  as provided and authorized by section three hundred eighty-six
of the public authorities law; programs to assist small and minority and
women-owned firms engaged  in  transportation  construction  and  recon-
struction  projects,  including  a  revolving  fund  for working capital
loans, and a bonding guarantee assistance  program  in  accordance  with
provisions of this chapter; matching federal grants or apportionments to
the state for highway, parkway and bridge capital projects; the acquisi-
tion  of  real property and interests therein required or expected to be
required in connection with such projects; preventive maintenance activ-
ities necessary to ensure that highways, parkways and  bridges  meet  or
exceed their optimum useful life; expenses of control of snow and ice on
state  highways  by  the  department of transportation including but not
limited to personal services, nonpersonal services and fringe  benefits,
payment  of  emergency aid for control of snow and ice in municipalities
pursuant to section fifty-five of the highway law, expenses  of  control
of  snow and ice on state highways by municipalities pursuant to section
twelve of the highway law, and  for  expenses  of  arterial  maintenance
agreements  with  cities pursuant to section three hundred forty-nine of
the highway law; personal services  and  fringe  benefit  costs  of  the
department of transportation for bus safety inspection activities; costs

S. 2609--C                         157

of  the  department  of  motor  vehicles,  including  but not limited to
personal and nonpersonal services; costs of engineering and  administra-
tive  services  of  the  department of transportation, including but not
limited  to  fringe  benefits; the contract services provided by private
firms in accordance with section fourteen  of  the  transportation  law;
personal services and nonpersonal services, for activities including but
not  limited  to  the  preparation of designs, plans, specifications and
estimates; construction management and supervision activities; costs  of
appraisals,  surveys,  testing  and  environmental impact statements for
transportation projects; expenses in connection with  buildings,  equip-
ment,  materials  and  facilities  used or useful in connection with the
maintenance, operation, and repair of  highways,  parkways  and  bridges
thereon;  and  project costs for: construction, reconstruction, improve-
ment, reconditioning and preservation of  rail  freight  facilities  and
intercity  rail passenger facilities and equipment; construction, recon-
struction, improvement, reconditioning and preservation of state, munic-
ipal and privately owned ports; construction,  reconstruction,  improve-
ment,  reconditioning  and preservation of municipal airports; privately
owned airports and aviation capital facilities, excluding airports oper-
ated by the state or operated by a bi-state municipal corporate  instru-
mentality  for  which  federal  funding  is  not  available provided the
project  is  consistent  with  an  approved  airport  layout  plan;  and
construction,  reconstruction,  enhancement,  improvement,  replacement,
reconditioning, restoration, rehabilitation and preservation  of  state,
county,  town,  city  and village roads, highways, parkways and bridges;
and construction, reconstruction, improvement, reconditioning and  pres-
ervation  of  fixed  ferry  facilities  of municipal and privately owned
ferry lines for transportation purposes, and the payment of debt service
required on any bonds, notes or other obligations and  related  expenses
for highway, parkway, bridge and project costs for: construction, recon-
struction,  improvement, reconditioning and preservation of rail freight
facilities  and  intercity  rail  passenger  facilities  and  equipment;
construction,  reconstruction, improvement, reconditioning and preserva-
tion of state, municipal and privately owned ports; construction, recon-
struction, improvement, reconditioning  and  preservation  of  municipal
airports;  privately  owned  airports  and  aviation capital facilities,
excluding airports operated by the  state  or  operated  by  a  bi-state
municipal  corporate  instrumentality  for  which federal funding is not
available provided the project is consistent with  an  approved  airport
layout  plan;  construction,  reconstruction,  enhancement, improvement,
replacement, reconditioning, restoration, rehabilitation  and  preserva-
tion  of state, county, town, city and village roads, highways, parkways
and bridges; and construction, reconstruction, improvement, recondition-
ing and preservation of fixed ferry facilities of municipal and private-
ly owned ferry lines for transportation purposes, purposes authorized on
or after the effective date of this section.  Beginning  with  disburse-
ments  made  on and after the first day of April, nineteen hundred nine-
ty-three, moneys in such fund shall be available to pay  such  costs  or
expenses made pursuant to appropriations or reappropriations made during
the  state  fiscal  year  which  began  on  the first of April, nineteen
hundred ninety-two. Beginning the first day of April,  nineteen  hundred
ninety-three,  moneys  in  such  fund  shall also be used for [payments]
TRANSFERS to the general debt service fund AND THE REVENUE BOND TAX FUND
of amounts equal to [amounts] THAT  RESPECTIVELY  required  for  service
contract  AND FINANCING AGREEMENT payments as provided and authorized by
section three hundred eighty of the public  authorities  law  [and  by],

S. 2609--C                         158

section eleven of chapter three hundred twenty-nine of the laws of nine-
teen  hundred  ninety-one,  as  amended,  AND SECTIONS SIXTY-EIGHT-C AND
SIXTY-NINE-O OF THIS CHAPTER.
  S  60-a.  Paragraph  a  of  subdivision 5 of section 89-b of the state
finance law, as amended by section 1 of part D of  chapter  151  of  the
laws of 2001, is amended to read as follows:
  a.  Moneys  in  the  dedicated  highway  and  bridge trust fund shall,
following appropriation by the legislature, be  utilized  for:    recon-
struction,  replacement, reconditioning, restoration, rehabilitation and
preservation of state, county, town, city and village  roads,  highways,
parkways,  and  bridges  thereon,  to  restore  such facilities to their
intended  functions;  construction,  reconstruction,   enhancement   and
improvement  of  state, county, town, city, and village roads, highways,
parkways, and bridges thereon, to address current and projected capacity
problems including costs for  traffic  mitigation  activities;  aviation
projects authorized pursuant to section fourteen-j of the transportation
law  and  for payments to the general debt service fund of amounts equal
to amounts required for service contract payments  related  to  aviation
projects  as provided and authorized by section three hundred eighty-six
of the public authorities law; programs to assist small and minority and
women-owned firms engaged  in  transportation  construction  and  recon-
struction  projects,  including  a  revolving  fund  for working capital
loans, and a bonding guarantee assistance  program  in  accordance  with
provisions of this chapter; matching federal grants or apportionments to
the state for highway, parkway and bridge capital projects; the acquisi-
tion  of  real property and interests therein required or expected to be
required in connection with such projects; preventive maintenance activ-
ities necessary to ensure that highways, parkways and  bridges  meet  or
exceed their optimum useful life; expenses of control of snow and ice on
state  highways  by  the  department of transportation including but not
limited to personal services, nonpersonal services and fringe  benefits,
payment  of  emergency aid for control of snow and ice in municipalities
pursuant to section fifty-five of the highway law, expenses  of  control
of  snow and ice on state highways by municipalities pursuant to section
twelve of the highway law, and  for  expenses  of  arterial  maintenance
agreements  with  cities pursuant to section three hundred forty-nine of
the highway law; personal services  and  fringe  benefit  costs  of  the
department of transportation for bus safety inspection activities; costs
of  engineering  and administrative services of the department of trans-
portation, including but not limited to fringe  benefits;  the  contract
services  provided  by private firms in accordance with section fourteen
of the transportation law; personal services and  nonpersonal  services,
for  activities including but not limited to the preparation of designs,
plans, specifications and estimates; construction management and  super-
vision  activities;  costs  of appraisals, surveys, testing and environ-
mental  impact  statements  for  transportation  projects;  expenses  in
connection  with  buildings, equipment, materials and facilities used or
useful in connection with the  maintenance,  operation,  and  repair  of
highways,   parkways   and  bridges  thereon;  and  project  costs  for:
construction, reconstruction, improvement, reconditioning and  preserva-
tion  of rail freight facilities and intercity rail passenger facilities
and equipment; construction, reconstruction, improvement, reconditioning
and  preservation  of  state,  municipal  and  privately  owned   ports;
construction,  reconstruction, improvement, reconditioning and preserva-
tion of municipal airports; privately owned airports and aviation  capi-
tal  facilities, excluding airports operated by the state or operated by

S. 2609--C                         159

a bi-state municipal corporate instrumentality for which federal funding
is not available provided the project is  consistent  with  an  approved
airport  layout  plan;  and  construction,  reconstruction, enhancement,
improvement,  replacement,  reconditioning,  restoration, rehabilitation
and preservation of state, county, town, city and village  roads,  high-
ways,  parkways  and bridges; and construction, reconstruction, improve-
ment, reconditioning and  preservation  of  fixed  ferry  facilities  of
municipal  and  privately owned ferry lines for transportation purposes,
and the payment of debt service required on any bonds,  notes  or  other
obligations  and  related  expenses  for  highway,  parkway,  bridge and
project costs for: construction, reconstruction,  improvement,  recondi-
tioning  and  preservation of rail freight facilities and intercity rail
passenger  facilities  and  equipment;   construction,   reconstruction,
improvement,  reconditioning  and  preservation  of state, municipal and
privately owned ports; construction, reconstruction, improvement, recon-
ditioning  and  preservation  of  municipal  airports;  privately  owned
airports and aviation capital facilities, excluding airports operated by
the  state or operated by a bi-state municipal corporate instrumentality
for which federal funding is  not  available  provided  the  project  is
consistent  with  an  approved airport layout plan; construction, recon-
struction, enhancement, improvement, replacement, reconditioning, resto-
ration, rehabilitation and preservation of state, county, town, city and
village roads, highways, parkways and bridges; and construction,  recon-
struction,  improvement,  reconditioning and preservation of fixed ferry
facilities of municipal and privately owned ferry lines for  transporta-
tion  purposes,  purposes  authorized  on or after the effective date of
this section. Beginning with disbursements made on and after  the  first
day  of  April, nineteen hundred ninety-three, moneys in such fund shall
be available to pay such costs or expenses made  pursuant  to  appropri-
ations or reappropriations made during the state fiscal year which began
on  the first of April, nineteen hundred ninety-two. Beginning the first
day of April, nineteen hundred ninety-three, moneys in such  fund  shall
also  be  used for [payments] TRANSFERS to the general debt service fund
AND THE REVENUE BOND TAX FUND of amounts equal to [amounts] THAT RESPEC-
TIVELY required for service contract AND FINANCING AGREEMENT payments as
provided and authorized by section three hundred eighty  of  the  public
authorities  law [and by], section eleven of chapter three hundred twen-
ty-nine of the laws of nineteen  hundred  ninety-one,  as  amended,  AND
SECTIONS SIXTY-EIGHT-C AND SIXTY-NINE-O OF THIS CHAPTER.
  S  61.  Subdivision  5  of  section  89-b  of the state finance law is
amended by adding a new paragraph c to read as follows:
  C. IN ADDITION TO THE PURPOSES FOR WHICH MONEYS IN THE DEDICATED HIGH-
WAY AND BRIDGE TRUST FUND CAN BE USED AS DESCRIBED IN  THIS  SUBSECTION,
SUBJECT  TO APPROPRIATION, AFTER MEETING THE REQUIREMENTS OF SUBDIVISION
THREE OF THIS SECTION, SUCH MONEYS SHALL BE USED  FOR  TRANSFER  TO  THE
REVENUE  BOND  TAX  FUND, AS ESTABLISHED BY SECTION NINETY-TWO-Z OF THIS
ARTICLE, IN AN AMOUNT EQUAL TO THAT  REQUIRED  FOR  FINANCING  AGREEMENT
PAYMENTS  PAID  ON  BONDS  AUTHORIZED  PURSUANT TO SECTION THREE HUNDRED
EIGHTY-FIVE OF THE  PUBLIC  AUTHORITIES  LAW,  AND  ISSUED  PURSUANT  TO
SECTIONS SIXTY-EIGHT-B AND SIXTY-NINE-N OF THIS CHAPTER.
  S  62.  Subdivision  3  of  section  97-g of the state finance law, as
amended by section 1 of subpart A of part C of chapter 97 of the laws of
2011, is amended to read as follows:
  3. Moneys of the fund shall be available to the commissioner of gener-
al services for the purchase of food, supplies and equipment  for  state
agencies,  and  for  the  purpose of furnishing or providing centralized

S. 2609--C                         160

services to or for state agencies; provided  further  that  such  moneys
shall  be available to the commissioner of general services for purposes
pursuant to items (d) and (f) of subdivision four of this section to  or
for  political subdivisions. Beginning the first day of April, two thou-
sand two, moneys in such fund shall also be  transferred  by  the  state
comptroller  to  the  revenue  bond tax fund account of the general debt
service fund in amounts equal to those required for payments to  author-
ized  issuers  for  revenue  bonds issued pursuant to article five-C AND
ARTICLE FIVE-F of this chapter for the purpose of  lease  purchases  and
installment  purchases  by  or  for  state agencies and institutions for
personal or real property purposes.
  S 63. Subdivision (j) of section 92-dd of the state  finance  law,  as
added  by  section  56  of part PP of chapter 56 of the laws of 2009, is
amended to read as follows:
  (j) The state comptroller shall transfer from the HCRA resources  fund
to the general debt service fund, revenue bond tax fund (311.02) amounts
equal  to  the  debt service paid for bonds, notes, or other obligations
issued PURSUANT TO ARTICLE FIVE-C AND ARTICLE FIVE-F OF THIS CHAPTER  to
finance the HEAL NY capital grant program authorized pursuant to section
sixteen hundred eighty-j of the public authorities law.
  S 64. The state finance law is amended by adding a new section 93-a to
read as follows:
  S 93-A. NEW YORK STATE STORM RECOVERY CAPITAL FUND.  1. NEW YORK STATE
STORM  RECOVERY  CAPITAL  FUND.  (A)  THERE IS HEREBY ESTABLISHED IN THE
JOINT CUSTODY OF THE COMPTROLLER AND THE COMMISSIONER  OF  TAXATION  AND
FINANCE A SPECIAL FUND TO BE KNOWN AS THE "NEW YORK STATE STORM RECOVERY
CAPITAL FUND".
  (B) SOURCES OF FUNDS. THE SOURCES OF FUNDS SHALL CONSIST OF ALL MONEYS
COLLECTED  THEREFOR,  OR  MONEYS  CREDITED,  APPROPRIATED OR TRANSFERRED
THERETO FROM ANY OTHER FUND OR SOURCE PURSUANT  TO  LAW,  OR  ANY  OTHER
MONEYS  MADE  AVAILABLE  FOR  THE  PURPOSES  OF  THE  FUND. ANY INTEREST
RECEIVED BY THE COMPTROLLER ON MONEYS ON DEPOSIT SHALL  BE  RETAINED  IN
AND BECOME A PART OF THE FUND, UNLESS OTHERWISE DIRECTED BY LAW.
  2.  USES  OF FUNDS. FOLLOWING APPROPRIATION BY THE LEGISLATURE, MONEYS
IN THE STORM RECOVERY CAPITAL FUND SHALL BE  AVAILABLE  TO  FINANCE  THE
REPAIR,  REHABILITATION,  OR  REPLACEMENT  OF  CAPITAL WORKS OR PURPOSES
DAMAGED BY HURRICANE SANDY OR ANY FUTURE NATURAL DISASTER EXPECTED TO BE
ELIGIBLE FOR REIMBURSEMENT BY THE FEDERAL  EMERGENCY  MANAGEMENT  AGENCY
(FEMA),  THE  FEDERAL  TRANSIT ADMINISTRATION (FTA), THE FEDERAL HIGHWAY
ADMINISTRATION (FHWA) AND ANY OTHER  FEDERAL  REIMBURSEMENT  SOURCE.  NO
MONEY IN THIS ACCOUNT MAY BE EXPENDED FOR ANY PROJECT UNTIL THE DIRECTOR
OF THE BUDGET HAS DETERMINED THAT THERE IS A SUBSTANTIAL LIKELIHOOD THAT
THE  COSTS  OF  SUCH PROJECT SHALL BE REIMBURSED BY FEDERAL SOURCES. THE
DIRECTOR SHALL ISSUE FORMAL RULES THAT SET FORTH THE PROCESS BY WHICH HE
OR SHE WILL DETERMINE WHETHER  THERE  IS  A  SUBSTANTIAL  LIKELIHOOD  OF
REIMBURSEMENT BY FEDERAL SOURCES.
  3.  TRANSFERS.  NOTWITHSTANDING  ANY  OTHER  PROVISION  OF  LAW TO THE
CONTRARY, FOR THE STATE FISCAL YEAR COMMENCING ON APRIL FIRST, TWO THOU-
SAND THIRTEEN, THE COMPTROLLER IS  HEREBY  AUTHORIZED  TO  TRANSFER  ANY
MONEYS  INTO OR FROM THE NEW YORK STATE STORM RECOVERY CAPITAL FUND INTO
OR FROM THE GENERAL FUND IN AN AMOUNT DETERMINED BY THE DIRECTOR OF  THE
BUDGET, TO THE EXTENT MONEYS ARE AVAILABLE IN THE FUND.
  S  65.  Subdivision 1 of section 45 of section 1 of chapter 174 of the
laws of 1968, constituting the New York state urban  development  corpo-
ration act, as amended by section 49 of part U of chapter 59 of the laws
of 2012, is amended to read as follows:

S. 2609--C                         161

  1.  Notwithstanding  the  provisions of any other law to the contrary,
the urban development corporation of the state of  New  York  is  hereby
authorized to issue bonds or notes in one or more series for the purpose
of funding project costs for the implementation of a NY-SUNY AND NY-CUNY
2020  challenge  grant  program subject to the approval of a NY-SUNY AND
NY-CUNY 2020 plan or plans by the governor and EITHER the chancellor  of
the state university of New York OR THE CHANCELLOR OF THE CITY UNIVERSI-
TY  OF NEW YORK, AS APPLICABLE.  The aggregate principal amount of bonds
authorized to be issued  pursuant  to  this  section  shall  not  exceed
[$110,000,000]  $220,000,000, excluding bonds issued to fund one or more
debt service reserve funds, to pay costs of issuance of such bonds,  and
bonds  or  notes issued to refund or otherwise repay such bonds or notes
previously issued. Such bonds and notes of the corporation shall not  be
a  debt  of  the  state,  and the state shall not be liable thereon, nor
shall they be payable out of any funds other than those appropriated  by
the  state  to  the  corporation  for  principal,  interest, and related
expenses pursuant to a service contract and such bonds and  notes  shall
contain  on  the  face  thereof  a  statement to such effect. Except for
purposes of complying with  the  internal  revenue  code,  any  interest
income earned on bond proceeds shall only be used to pay debt service on
such bonds.
  S  65-a.  Section  16  of chapter 260 of the laws of 2011 amending the
education law and the New York state urban development corporation  act,
relating  to establishing components of the NY-SUNY 2020 challenge grant
program, is amended to read as follows:
  S 16. This act shall take effect July 1,  2011  [and];  PROVIDED  THAT
SECTIONS  ONE,  TWO,  THREE,  FOUR, FIVE, SIX, EIGHT, NINE, TEN, ELEVEN,
TWELVE, THIRTEEN, FOURTEEN AND FIFTEEN OF THIS ACT shall expire 5  years
after such effective date when upon such date the provisions of this act
shall be deemed repealed.
  S  66. Subdivision 10-a of section 1680 of the public authorities law,
as amended by section 51 of part U of chapter 59 of the laws of 2012, is
amended to read as follows:
  10-a. Subject to the provisions of chapter fifty-nine of the  laws  of
two  thousand, but notwithstanding any other provision of the law to the
contrary, the maximum amount of bonds and notes to be issued after March
thirty-first, two thousand two, on behalf of the state, in  relation  to
any  locally  sponsored community college, shall be six hundred [twenty-
three] SIXTY-THREE million dollars. Such amount shall  be  exclusive  of
bonds and notes issued to fund any reserve fund or funds, costs of issu-
ance  and to refund any outstanding bonds and notes, issued on behalf of
the state, relating to a locally sponsored community college.
  S 67. Paragraph (c) of subdivision 14 of section 1680  of  the  public
authorities  law,  as  amended by section 39 of part PP of chapter 56 of
the laws of 2009, is amended to read as follows:
  (c) Subject to the provisions of chapter fifty-nine of the laws of two
thousand, (i) the dormitory authority shall  not  deliver  a  series  of
bonds for city university community college facilities, except to refund
or  to  be substituted for or in lieu of other bonds in relation to city
university community college facilities pursuant to a resolution of  the
dormitory  authority adopted before July first, nineteen hundred eighty-
five or any resolution supplemental thereto, if the principal amount  of
bonds  so  to  be  issued  when  added to all principal amounts of bonds
previously issued by the dormitory authority for city university  commu-
nity  college  facilities, except to refund or to be substituted in lieu
of other bonds in relation to city university community college  facili-

S. 2609--C                         162

ties will exceed the sum of four hundred twenty-five million dollars and
(ii)  the dormitory authority shall not deliver a series of bonds issued
for city university facilities, including community college  facilities,
pursuant  to a resolution of the dormitory authority adopted on or after
July first, nineteen hundred eighty-five, except  to  refund  or  to  be
substituted for or in lieu of other bonds in relation to city university
facilities  and except for bonds issued pursuant to a resolution supple-
mental to a resolution of the dormitory authority adopted prior to  July
first, nineteen hundred eighty-five, if the principal amount of bonds so
to  be  issued  when  added  to the principal amount of bonds previously
issued pursuant to any such resolution, except bonds issued to refund or
to be substituted for or in lieu of other  bonds  in  relation  to  city
university  facilities,  will  exceed  six billion eight hundred [forty-
three] FIFTY-THREE million two hundred thousand dollars.   The  legisla-
ture  reserves the right to amend or repeal such limit, and the state of
New York, the dormitory authority, the city university, and the fund are
prohibited from covenanting or making any other agreements with  or  for
the benefit of bondholders which might in any way affect such right.
  S  68.  Subdivision  (a)  of section 48 of part K of chapter 81 of the
laws of 2002, providing for the  administration  of  certain  funds  and
accounts  related  to  the 2002-2003 budget, as amended by section 40 of
part BB of chapter 58 of the  laws  of  2011,  is  amended  to  read  as
follows:
  (a)  Subject  to  the provisions of chapter 59 of the laws of 2000 but
notwithstanding the provisions of section 18 of  the  urban  development
corporation  act, the corporation is hereby authorized to issue bonds or
notes in one or more series in an  aggregate  principal  amount  not  to
exceed  $67,000,000  excluding  bonds  issued  to  fund one or more debt
service reserve funds, to pay costs of issuance of such bonds, and bonds
or notes issued to refund or otherwise repay such bonds or notes  previ-
ously  issued,  for  the  purpose  of financing capital costs related to
homeland security and training facilities  for  the  division  of  state
police,  the division of military and naval affairs, and any other state
agency, including the reimbursement of any disbursements made  from  the
state  capital projects fund, and is hereby authorized to issue bonds or
notes in one or more series in an  aggregate  principal  amount  not  to
exceed  [$205,800,000]  $220,800,000, excluding bonds issued to fund one
or more debt service reserve funds, to pay costs  of  issuance  of  such
bonds, and bonds or notes issued to refund or otherwise repay such bonds
or notes previously issued, for the purpose of financing improvements to
State office buildings and other facilities located statewide, including
the  reimbursement  of  any  disbursements  made  from the state capital
projects fund. Such bonds and notes of the corporation shall  not  be  a
debt  of the state, and the state shall not be liable thereon, nor shall
they be payable out of any funds other than those  appropriated  by  the
state  to the corporation for debt service and related expenses pursuant
to any service contracts executed pursuant to subdivision  (b)  of  this
section,  and  such  bonds and notes shall contain on the face thereof a
statement to such effect.
  S 69. The section heading and subdivision 1 of section  386-b  of  the
public  authorities  law, as added by section 48 of part U of chapter 59
of the laws of 2012, is amended to read as follows:
  Financing of peace bridge  AND  TRANSPORTATION  CAPITAL  projects.  1.
Notwithstanding any other provision of law to the contrary, the authori-
ty,  the  dormitory  authority and the urban development corporation are
hereby authorized to issue bonds or notes in one or more series for  the

S. 2609--C                         163

purpose  of  financing  peace bridge projects AND CAPITAL COSTS OF STATE
AND LOCAL HIGHWAYS, PARKWAYS, BRIDGES, THE NEW YORK STATE THRUWAY, INDI-
AN RESERVATION ROADS, AND FACILITIES, AND TRANSPORTATION  INFRASTRUCTURE
PROJECTS,  INCLUDING WORK APPURTENANT AND ANCILLARY THERETO.  The aggre-
gate principal amount of bonds authorized to be issued pursuant to  this
section   shall   not  exceed  THREE  HUNDRED  fifteen  million  dollars
[($15,000,000)] ($315,000,000), excluding bonds issued to  fund  one  or
more debt service reserve funds, to pay costs of issuance of such bonds,
and  to refund or otherwise repay such bonds or notes previously issued.
Such bonds and notes of the authority, the dormitory authority  and  the
urban  development corporation shall not be a debt of the state, and the
state shall not be liable thereon, nor shall they be payable out of  any
funds  other  than those appropriated by the state to the authority, the
dormitory authority and the urban development corporation for principal,
interest, and related expenses pursuant to a service contract  and  such
bonds  and  notes  shall contain on the face thereof a statement to such
effect. Except for purposes of complying with the internal revenue code,
any interest income earned on bond proceeds shall only be  used  to  pay
debt service on such bonds.
  S  69-a. Paragraph (c) of subdivision 19 of section 1680 of the public
authorities law, as amended by section 52 of part U of chapter 59 of the
laws of 2012, is amended to read as follows:
  (c) Subject to the provisions of chapter fifty-nine of the laws of two
thousand, the dormitory authority shall not issue any  bonds  for  state
university  educational  facilities  purposes if the principal amount of
bonds to be issued when added to the aggregate principal amount of bonds
issued by the dormitory authority on  and  after  July  first,  nineteen
hundred  eighty-eight  for  state university educational facilities will
exceed ten  billion  [three]  FOUR  hundred  [four]  TWENTY-TWO  million
dollars;  provided,  however, that bonds issued or to be issued shall be
excluded from such limitation if: (1) such bonds are  issued  to  refund
state  university  construction  bonds and state university construction
notes previously issued by the housing finance agency; or (2) such bonds
are issued to refund bonds of the authority or other obligations  issued
for  state  university  educational  facilities purposes and the present
value of the aggregate debt service on  the  refunding  bonds  does  not
exceed  the  present  value  of  the aggregate debt service on the bonds
refunded thereby; provided,  further  that  upon  certification  by  the
director  of  the  budget  that the issuance of refunding bonds or other
obligations issued between April first, nineteen hundred ninety-two  and
March  thirty-first,  nineteen  hundred  ninety-three will generate long
term economic benefits to the state, as  assessed  on  a  present  value
basis,  such  issuance will be deemed to have met the present value test
noted above. For purposes of this subdivision, the present value of  the
aggregate  debt  service  of  the refunding bonds and the aggregate debt
service of the bonds refunded, shall be calculated by utilizing the true
interest cost of the refunding bonds, which shall be that  rate  arrived
at  by doubling the semi-annual interest rate (compounded semi-annually)
necessary to discount the debt service payments on the  refunding  bonds
from  the  payment  dates  thereof to the date of issue of the refunding
bonds to the purchase price of the refunding bonds,  including  interest
accrued  thereon  prior  to  the  issuance thereof. The maturity of such
bonds, other than bonds issued to refund outstanding  bonds,  shall  not
exceed  the  weighted  average  economic life, as certified by the state
university construction fund, of the facilities in connection with which
the bonds are issued, and in any case not  later  than  the  earlier  of

S. 2609--C                         164

thirty  years  or  the  expiration of the term of any lease, sublease or
other agreement relating  thereto;  provided  that  no  note,  including
renewals  thereof,  shall mature later than five years after the date of
issuance  of  such  note. The legislature reserves the right to amend or
repeal such limit, and the state of New York, the  dormitory  authority,
the  state university of New York, and the state university construction
fund are prohibited from covenanting or making any other agreements with
or for the benefit of bondholders which might in  any  way  affect  such
right.
  S  70.  This  act shall take effect immediately and shall be deemed to
have been in full force and effect on and after April 1, 2013;  provided
that:
  (a)  sections  one through nine, sections thirteen, fourteen, eighteen
and twenty-one and sections twenty-four through forty of this act  shall
expire  March  31,  2014,  when  upon  such date, the provisions of such
sections shall be deemed repealed;
  (b) the amendments to subdivision 3  of  section  99-h  of  the  state
finance  law  made  by section twenty-three of this act shall not affect
the expiration of such subdivision and section respectively and shall be
deemed to expire therewith;
  (c) the amendments to subdivision 5 of  section  3234  of  the  public
authorities law made by section forty-five of this act shall take effect
on the same date and in the same manner as section 54 of part K of chap-
ter 81 of the laws of 2002 takes effect;
  (d)  the amendments to paragraph a of subdivision 5 of section 89-b of
the state finance law made by section sixty of this act shall be subject
to the expiration and reversion of such paragraph pursuant to section  2
of  part B of chapter 84 of the laws of 2002, as amended, when upon such
date the provisions of section sixty-a of this act  shall  take  effect;
and
  (e)  the  amendments  to  subdivision  3  of section 97-g of the state
finance law made by section sixty-two of this act shall not  affect  the
expiration  and  reversion  of  such  subdivision and shall be deemed to
expire therewith.
  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  3.  This  act shall take effect immediately provided, however, that
the applicable effective date of Parts A through GGG of this  act  shall
be as specifically set forth in the last section of such Parts.

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

    S. 2609--D                                            A. 3009--D

                      S E N A T E - A S S E M B L Y

                            January 22, 2013
                               ___________

IN  SENATE -- A BUDGET BILL, submitted by the Governor pursuant to arti-
  cle seven of the Constitution -- read twice and ordered  printed,  and
  when  printed to be committed to the Committee on Finance -- committee
  discharged, bill amended, ordered reprinted as amended and recommitted
  to said committee  --  committee  discharged,  bill  amended,  ordered
  reprinted  as  amended  and recommitted to said committee -- committee
  discharged, bill amended, ordered reprinted as amended and recommitted
  to said committee  --  committee  discharged,  bill  amended,  ordered
  reprinted as amended and recommitted to said committee

IN  ASSEMBLY  --  A  BUDGET  BILL, submitted by the Governor pursuant to
  article seven of the Constitution -- read once  and  referred  to  the
  Committee  on  Ways  and  Means -- committee discharged, bill amended,
  ordered reprinted as amended and  recommitted  to  said  committee  --
  again  reported from said committee with amendments, ordered reprinted
  as amended and recommitted to said committee --  again  reported  from
  said  committee  with  amendments,  ordered  reprinted  as amended and
  recommitted to said committee -- again reported  from  said  committee
  with  amendments, ordered reprinted as amended and recommitted to said
  committee

AN ACT to amend the tax law, in relation to the  temporary  metropolitan
  transportation  business tax surcharge (Part A); to amend the tax law,
  in relation to the empire state film production credit and the  empire
  state film post production credit; and to amend part Y-1 of chapter 57
  of  the laws of 2009 amending the tax law relating to the empire state
  film production credit, in relation to reports (Part B); to amend  the
  urban  development corporation act, the tax law and the administrative
  code of the city of New York, in relation to establishing the New York
  business incubator and innovation hot spot support act  (Part  C);  to
  amend the tax law and the administrative code of the city of New York,
  in  relation to extending for three years the charitable contributions
  deduction limitation (Part D); to amend the tax law and  the  adminis-
  trative  code of the city of New York, in relation to the exclusion of
  certain royalty payments from the entire net income or  other  taxable
  basis  of  corporations,  banking  corporations,  and insurance corpo-
  rations, from the unrelated business income of corporations, and  from
  the  adjusted  gross  income  of  individual  taxpayers; and to repeal

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
              

                      [ ] is old law to be omitted.
                                                           LBD12574-06-3

S. 2609--D                          2                         A. 3009--D

  certain provisions of the tax law relating thereto (Part E); to  amend
  the tax law, in relation to the historic preservation tax credit (Part
  F);  to  amend  the tax law, in relation to providing a tax credit for
  electric  vehicle recharging property (Part G); to amend chapter 61 of
  the laws of 2011 amending the real property tax  law  and  other  laws
  relating  to  establishing  standards for electronic real property tax
  administration, in relation to extending provisions relating to manda-
  tory electronic filing  of  tax  documents  and  improving  sales  tax
  compliance  (Part  H);  intentionally  omitted  (Part I); to amend the
  general municipal law, in relation to restrictions  on  funds  of  the
  industrial  development  agency and to amend the general municipal 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 exclusively 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);
  intentionally  omitted  (Part  M);  intentionally omitted (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 and the vehicle and traffic 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; and providing for the repeal of
  such provisions upon the expiration thereof  (Part  Q);  intentionally
  omitted  (Part  R);  intentionally  omitted (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  simul-
  cast,  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-mu-
  tuel 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 extending certain
  provisions thereof; and to amend the racing, pari-mutuel wagering  and
  breeding  law,  in  relation  to  extending certain provisions thereof
  (Part U); to amend the tax law, in relation  to  the  credit  for  the
  rehabilitation  of  historic  homes (Part V); to amend the tax law, in
  relation to allowing certain tax-free interdistributor sales of  high-
  way  diesel  motor fuel (Part W); to amend the tax law, in relation to
  updating the farming exemption in  the  highway  use  tax  to  reflect
  current  industry  practice  (Part  X);  to  amend the tax law and the
  administrative code of the city of New York, in relation to  providing
  a  subtraction  from income for small businesses and small farms (Part
  Y); to amend the tax  law,  in  relation  to  providing  tax  cuts  to
  manufacturers  (Part Z); to amend the tax law, in relation to adding a
  hire a vet credit (Part AA); to  amend  the  public  service  law,  in
  relation to extending the temporary state energy and utility conserva-
  tion  assessment;  and  to amend section 6 of part NN of chapter 59 of
  the laws of 2009 amending the public service law relating to financing
  the operations of the department of public service, the public service

S. 2609--D                          3                         A. 3009--D

  commission, department support and energy management services provided
  by other state agencies, increasing the utility assessment cap and the
  minimum threshold for collection thereunder, and establishing a tempo-
  rary  state  energy  and  utility  service conservation assessment and
  providing for the collection thereof, in  relation  to  extending  the
  effectiveness  thereof (Part BB); to amend the tax law, in relation to
  a credit for middle income taxpayers with children (Part CC); to amend
  the labor law, in relation to the New  York  youth  works  tax  credit
  program (Part DD); to amend the tax law, in relation to adding a mini-
  mum  wage  reimbursement  credit  (Part  EE); to amend the tax law, in
  relation to personal income tax rates; to amend section 11 of  part  A
  of  chapter  56  of  the  laws  of 2011, relating to the tax rates and
  exclusions under the  metropolitan  commuter  transportation  mobility
  tax, relating to withholding tables and methods for certain tax years;
  and to amend the administrative code of the city of New York, relating
  to the amounts of standard deductions (Part FF); to amend the tax law,
  in relation to the gift for New York state teen health education fund;
  and  to  amend  the state finance law, in relation to establishing the
  New York state teen health education fund  (Part  GG);  to  amend  the
  state finance law, in relation to eligible businesses participating in
  the  excelsior linked deposit program (Part HH); to amend the New York
  state urban development corporation act, in relation to small business
  loan funds for business enterprises that are minority- and women-owned
  (Part II); and in relation to establishing a New York state innovation
  capital fund (Part JJ)

  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 JJ. 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

S. 2609--D                          4                         A. 3009--D

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
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

S. 2609--D                          5                         A. 3009--D

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
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

S. 2609--D                          6                         A. 3009--D

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-
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;

S. 2609--D                          7                         A. 3009--D

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
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

S. 2609--D                          8                         A. 3009--D

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
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

S. 2609--D                          9                         A. 3009--D

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
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-

S. 2609--D                         10                         A. 3009--D

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
(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

S. 2609--D                         11                         A. 3009--D

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
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

S. 2609--D                         12                         A. 3009--D

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
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,  (D)  THE
CREDIT-ELIGIBLE MAN HOURS FOR EACH PROJECT; AND (E) TOTAL WAGES FOR SUCH
CREDIT-ELIGIBLE MAN HOURS FOR EACH PROJECT; AND

S. 2609--D                         13                         A. 3009--D

  (6)(A)  THE  NAME  OF  EACH  TAXPAYER  ALLOCATED A TAX CREDIT FOR EACH
PROJECT AND THE COUNTY OF RESIDENCE OR INCORPORATION  OF  SUCH  TAXPAYER
OR,  IF THE TAXPAYER DOES NOT RESIDE OR IS NOT INCORPORATED IN NEW YORK,
THEN THE STATE OF RESIDENCE OR INCORPORATION; 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 COMPA-
NY,  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 PART-
NER 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 CRED-
IT, 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,  INCLUD-
ING 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
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. Subdivision (a) of section 24 of the tax law is amended by adding
a new paragraph 5 to read as follows:
  (5) FOR THE PERIOD TWO THOUSAND FIFTEEN THROUGH TWO THOUSAND NINETEEN,
IN ADDITION TO THE AMOUNT OF CREDIT ESTABLISHED IN PARAGRAPH TWO OF THIS
SUBDIVISION,  A  TAXPAYER SHALL BE ALLOWED A CREDIT EQUAL TO THE PRODUCT
(OR PRO RATA SHARE OF THE PRODUCT, IN THE CASE OF A MEMBER OF A PARTNER-
SHIP) OF TEN PERCENT AND THE AMOUNT OF WAGES OR SALARIES PAID  TO  INDI-
VIDUALS  DIRECTLY  EMPLOYED (EXCLUDING THOSE EMPLOYED AS WRITERS, DIREC-
TORS, MUSIC DIRECTORS, PRODUCERS AND  PERFORMERS,  INCLUDING  BACKGROUND
ACTORS WITH NO SCRIPTED LINES) BY A QUALIFIED FILM PRODUCTION COMPANY OR
A  QUALIFIED  INDEPENDENT FILM PRODUCTION COMPANY FOR SERVICES PERFORMED
BY THOSE INDIVIDUALS IN ONE OF THE COUNTIES SPECIFIED IN THIS  PARAGRAPH
IN  CONNECTION  WITH  A  QUALIFIED  FILM  WITH  A MINIMUM BUDGET OF FIVE
HUNDRED THOUSAND DOLLARS. FOR PURPOSES OF THIS  ADDITIONAL  CREDIT,  THE
SERVICES  MUST  BE  PERFORMED  IN ONE OR MORE OF THE FOLLOWING COUNTIES:
ALLEGANY, BROOME, CATTARAUGUS, CAYUGA,  CHAUTAUQUA,  CHEMUNG,  CHENANGO,
CLINTON,  CORTLAND,  DELAWARE,  ERIE,  ESSEX, FRANKLIN, FULTON, GENESEE,
HAMILTON, HERKIMER, JEFFERSON, LEWIS, LIVINGSTON, MADISON, MONROE, MONT-
GOMERY, NIAGARA, ONEIDA, ONONDAGA,  ONTARIO,  ORLEANS,  OSWEGO,  OTSEGO,
SCHOHARIE,  SCHUYLER,  SENECA,  ST.  LAWRENCE, STEUBEN, TIOGA, TOMPKINS,
WAYNE, WYOMING, OR YATES. THE AGGREGATE AMOUNT OF  TAX  CREDITS  ALLOWED
PURSUANT  TO  THE  AUTHORITY  OF  THIS  PARAGRAPH  SHALL BE FIVE MILLION

S. 2609--D                         14                         A. 3009--D

DOLLARS EACH YEAR DURING THE PERIOD TWO  THOUSAND  FIFTEEN  THROUGH  TWO
THOUSAND NINETEEN OF THE ANNUAL ALLOCATION MADE AVAILABLE TO THE PROGRAM
PURSUANT  TO  PARAGRAPH  FOUR  OF SUBDIVISION (E) OF THIS SECTION.  SUCH
AGGREGATE  AMOUNT OF CREDITS SHALL BE ALLOCATED BY THE GOVERNOR'S OFFICE
FOR MOTION PICTURE AND TELEVISION DEVELOPMENT AMONG TAXPAYERS  IN  ORDER
OF  PRIORITY BASED UPON THE DATE OF FILING AN APPLICATION FOR ALLOCATION
OF FILM PRODUCTION CREDIT WITH SUCH OFFICE. IF THE TOTAL AMOUNT OF ALLO-
CATED CREDITS APPLIED FOR UNDER THIS PARAGRAPH IN ANY YEAR  EXCEEDS  THE
AGGREGATE  AMOUNT  OF TAX CREDITS ALLOWED FOR SUCH YEAR UNDER THIS PARA-
GRAPH, SUCH EXCESS SHALL BE TREATED AS HAVING BEEN APPLIED  FOR  ON  THE
FIRST  DAY OF THE NEXT YEAR.  IF THE TOTAL AMOUNT OF ALLOCATED TAX CRED-
ITS APPLIED FOR UNDER THIS PARAGRAPH AT THE CONCLUSION OF  ANY  YEAR  IS
LESS  THAN  FIVE MILLION DOLLARS, THE REMAINDER SHALL BE TREATED AS PART
OF THE ANNUAL ALLOCATION MADE AVAILABLE TO THE PROGRAM PURSUANT TO PARA-
GRAPH FOUR OF SUBDIVISION (E) OF THIS SECTION. HOWEVER, IN NO EVENT  MAY
THE  TOTAL OF THE CREDITS ALLOCATED UNDER THIS PARAGRAPH AND THE CREDITS
ALLOCATED UNDER PARAGRAPH FIVE OF SUBDIVISION (A) OF SECTION  THIRTY-ONE
OF THIS ARTICLE EXCEED FIVE MILLION DOLLARS IN ANY YEAR DURING THE PERI-
OD TWO THOUSAND FIFTEEN THROUGH TWO THOUSAND NINETEEN.
  S 8. 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) FOR THE PERIOD TWO THOUSAND FIFTEEN THROUGH TWO THOUSAND NINETEEN,
IN ADDITION TO THE AMOUNT OF CREDIT  ESTABLISHED  IN  PARAGRAPH  TWO  OF
SUBDIVISION  (A)  OF  THIS SECTION, A TAXPAYER SHALL BE ALLOWED A CREDIT
EQUAL TO THE PRODUCT (OR PRO RATA SHARE OF THE PRODUCT, IN THE CASE OF A
MEMBER OF A PARTNERSHIP) OF TEN PERCENT AND THE AMOUNT OF WAGES OR SALA-
RIES PAID TO INDIVIDUALS DIRECTLY EMPLOYED (EXCLUDING THOSE EMPLOYED  AS
WRITERS, DIRECTORS, MUSIC DIRECTORS, PRODUCERS AND PERFORMERS, INCLUDING
BACKGROUND  ACTORS  WITH  NO  SCRIPTED  LINES) FOR SERVICES PERFORMED BY
THOSE INDIVIDUALS IN ONE OF THE COUNTIES SPECIFIED IN THIS PARAGRAPH  IN
CONNECTION  WITH  THE  POST  PRODUCTION  WORK ON A QUALIFIED FILM WITH A
MINIMUM BUDGET OF FIVE HUNDRED THOUSAND  DOLLARS  AT  A  QUALIFIED  POST
PRODUCTION FACILITY IN ONE OF THE COUNTIES LISTED IN THIS PARAGRAPH. FOR
PURPOSES  OF  THIS  ADDITIONAL CREDIT, THE SERVICES MUST BE PERFORMED IN
ONE OR MORE OF THE FOLLOWING COUNTIES:   ALLEGANY, BROOME,  CATTARAUGUS,
CAYUGA,  CHAUTAUQUA,  CHEMUNG,  CHENANGO,  CLINTON,  CORTLAND, DELAWARE,
ERIE, ESSEX, FRANKLIN, FULTON, GENESEE, HAMILTON,  HERKIMER,  JEFFERSON,
LEWIS, LIVINGSTON, MADISON, MONROE, MONTGOMERY, NIAGARA, ONEIDA, ONONDA-
GA,  ONTARIO,  ORLEANS, OSWEGO, OTSEGO, SCHOHARIE, SCHUYLER, SENECA, ST.
LAWRENCE, STEUBEN, TIOGA, TOMPKINS, WAYNE, WYOMING, OR YATES. THE AGGRE-
GATE AMOUNT OF TAX CREDITS ALLOWED PURSUANT TO  THE  AUTHORITY  OF  THIS
PARAGRAPH  SHALL BE FIVE MILLION DOLLARS EACH YEAR DURING THE PERIOD TWO
THOUSAND FIFTEEN THROUGH TWO THOUSAND NINETEEN OF THE ANNUAL  ALLOCATION
MADE  AVAILABLE TO THE EMPIRE STATE FILM POST PRODUCTION CREDIT PURSUANT
TO PARAGRAPH FOUR OF SUBDIVISION (E)  OF  SECTION  TWENTY-FOUR  OF  THIS
ARTICLE.  SUCH  AGGREGATE  AMOUNT  OF  CREDITS SHALL BE ALLOCATED BY THE
GOVERNOR'S OFFICE FOR MOTION PICTURE AND  TELEVISION  DEVELOPMENT  AMONG
TAXPAYERS IN ORDER OF PRIORITY BASED UPON THE DATE OF FILING AN APPLICA-
TION  FOR  ALLOCATION OF POST PRODUCTION CREDIT WITH SUCH OFFICE. IF THE
TOTAL AMOUNT OF ALLOCATED CREDITS APPLIED FOR UNDER  THIS  PARAGRAPH  IN
ANY  YEAR  EXCEEDS  THE AGGREGATE AMOUNT OF TAX CREDITS ALLOWED FOR SUCH
YEAR UNDER THIS PARAGRAPH, SUCH EXCESS SHALL BE TREATED AS  HAVING  BEEN
APPLIED  FOR  ON THE FIRST DAY OF THE NEXT YEAR.  IF THE TOTAL AMOUNT OF
ALLOCATED TAX CREDITS APPLIED FOR UNDER THIS PARAGRAPH AT THE CONCLUSION
OF ANY YEAR IS LESS THAN FIVE MILLION DOLLARS, THE  REMAINDER  SHALL  BE

S. 2609--D                         15                         A. 3009--D

TREATED AS PART OF THE ANNUAL ALLOCATION FOR TWO THOUSAND SEVENTEEN MADE
AVAILABLE  TO  THE  EMPIRE STATE FILM POST PRODUCTION CREDIT PURSUANT TO
PARAGRAPH FOUR OF SUBDIVISION (E) OF SECTION TWENTY FOUR OF  THIS  ARTI-
CLE.  HOWEVER,  IN NO EVENT MAY THE TOTAL OF THE CREDITS ALLOCATED UNDER
THIS PARAGRAPH AND THE CREDITS ALLOCATED UNDER PARAGRAPH FIVE OF  SUBDI-
VISION  (A)  OF  SECTION TWENTY-FOUR OF THIS ARTICLE EXCEED FIVE MILLION
DOLLARS IN ANY YEAR DURING THE PERIOD TWO THOUSAND FIFTEEN  THROUGH  TWO
THOUSAND NINETEEN.
  S  9.  This act shall take effect immediately, provided, however, that
sections four and five of this act shall apply to (a) taxpayers  submit-
ting 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  (b) to taxpayers who filed an initial application before this
act shall have become a law but who  have  not  yet  submitted  a  final
application  to  the  governor's office of motion picture and television
development on or before the date this act  shall  have  become  a  law,
provided  such  taxpayers agree to have 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, which added a new
paragraph 6 to subdivision (a) of such section 3 apply to them; 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.  Section 1 of chapter 174 of the laws of 1968 constituting
the urban development corporation act is amended by adding a new section
16-v to read as follows:
  S 16-V. NEW YORK STATE BUSINESS  INCUBATOR  AND  INNOVATION  HOT  SPOT
SUPPORT  ACT.  1.  (A)  THE  CORPORATION IS AUTHORIZED, WITHIN AVAILABLE
APPROPRIATIONS, TO ISSUE REQUESTS FOR PROPOSALS ONCE PER FISCAL YEAR  TO
PROVIDE GRANTS PURSUANT TO SUBDIVISIONS FIVE AND SIX OF THIS SECTION FOR
THE  PURPOSES  ESTABLISHED UNDER THIS ACT. THE CORPORATION MAY DESIGNATE
ENTITIES, WHICH UPON APPLICATION MEET THE  REQUIREMENTS  OF  SUBDIVISION
TWO OF THIS SECTION AS NEW YORK STATE INCUBATORS, AND MAY PROVIDE GRANTS
AND  ASSISTANCE  AS  PROVIDED  UNDER  SUBDIVISIONS  FIVE AND SIX OF THIS
SECTION TO SUCH DESIGNATED ENTITIES. "NEW YORK  STATE  INCUBATOR"  SHALL
MEAN A BUSINESS INCUBATION PROGRAM WHICH ALSO PROVIDES PHYSICAL SPACE OR
WHICH  IS  A  VIRTUAL  INCUBATION  PROGRAM THAT HAS BEEN DESIGNATED UPON
APPLICATION BY THE CORPORATION AS A NEW YORK STATE INCUBATOR PURSUANT TO
SUBDIVISIONS TWO AND THREE OF THIS SECTION  AND  WHICH  THEREBY  BECOMES
ELIGIBLE  FOR BENEFITS, SUPPORT, SERVICES, AND PROGRAMS AVAILABLE PURSU-
ANT TO SUCH DESIGNATION. PROVIDED HOWEVER, THAT VIRTUAL INCUBATORS WHICH
PROVIDE ASSISTANCE TO ELIGIBLE BUSINESSES NOT IN RESIDENCE IN ONE  PHYS-
ICAL  LOCATION,  SHALL  SUBMIT  A PLAN OF OPERATION WHICH SETS FORTH THE
MAXIMUM NUMBER OF ELIGIBLE BUSINESSES TO BE SERVED AND THEIR  GEOGRAPHIC
DISTRIBUTION.
  (B)  FROM  AMONG THE QUALIFIED "NEW YORK STATE INCUBATORS", THE CORPO-
RATION IS FURTHER AUTHORIZED, WITHIN AVAILABLE APPROPRIATIONS, TO DESIG-
NATE APPLICANTS AS "NEW YORK STATE INNOVATION HOT SPOTS."  AN  INCUBATOR
RECEIVING  A  "NEW  YORK STATE INNOVATION HOT SPOT" DESIGNATION SHALL BE
ELIGIBLE FOR THE BENEFITS UNDER SECTION THIRTY-EIGHT  OF  THE  TAX  LAW,

S. 2609--D                         16                         A. 3009--D

SUBPARAGRAPH  EIGHTEEN  OF  PARAGRAPH (A) OF SUBDIVISION NINE OF SECTION
TWO HUNDRED EIGHT OF THE TAX LAW,  SUBDIVISION  ELEVEN  OF  SECTION  TWO
HUNDRED  NINE OF THE TAX LAW, PARAGRAPH THIRTY-NINE OF SUBSECTION (C) OF
SECTION  SIX HUNDRED TWELVE OF THE TAX LAW, PARAGRAPH ONE OF SUBDIVISION
(D) OF SECTION ONE THOUSAND ONE HUNDRED NINETEEN OF  THE  TAX  LAW,  AND
PARAGRAPH  THIRTY-FIVE  OF  SUBDIVISION  (C)  OF  SECTION 11-1712 OF THE
ADMINISTRATIVE CODE OF THE CITY OF NEW YORK.
  2. REQUIREMENTS FOR DESIGNATION. (A) AN ENTITY WISHING  TO  BE  DESIG-
NATED  AS  A  NEW  YORK STATE INNOVATION HOT SPOT OR AS A NEW YORK STATE
INCUBATOR PURSUANT TO THIS SECTION SHALL BE LOCATED IN  NEW  YORK  STATE
AND  SHALL HAVE BEEN IN EXISTENCE OR OTHERWISE IN OPERATION FOR A PERIOD
OF AT LEAST THREE FISCAL YEARS PRIOR TO  THE  CURRENT  FISCAL  YEAR,  OR
DEMONSTRATE CONTINUITY OF STAFFING, PROGRAM, AND PURPOSE SHOWING CONTIN-
UATION  THROUGH  ANOTHER  AUSPICE  OR  GOVERNING  ENTITY, AND SHALL HAVE
DEMONSTRATED A CONNECTION TO REGIONAL SOURCES OF INNOVATION  AND  EXPER-
TISE,  AND THAT IT MEETS THE GOALS OF CREATING JOBS AND INCUBATING BUSI-
NESSES WITH SURVIVAL RATES IN EXCESS OF AVERAGE STARTUPS, AND  THAT  THE
PROGRAM  HAS  A  STRATEGIC  PLAN  TO CONTINUE TO MEET SUCH GOALS FOR THE
THREE YEARS SUCCEEDING DESIGNATION  AND  THAT  COMMITS  THE  PROGRAM  TO
IMPLEMENTING  BEST PRACTICES. SUCH DEMONSTRATION SHALL INCLUDE A COMMIT-
MENT BY THE SPONSOR TO CONTINUE TO MAINTAIN THE  PROGRAM  FOR  AT  LEAST
THREE  YEARS AFTER SUCH DESIGNATION, AND TO PROVIDE ANY REPORTING INFOR-
MATION THAT THE CORPORATION SHALL REQUIRE.
  (B) IN DETERMINING WHETHER AN ENTITY SHALL BE DESIGNATED AS A NEW YORK
STATE INNOVATION HOT SPOT OR NEW YORK STATE INCUBATOR,  THE  CORPORATION
SHALL REQUIRE THAT THE ENTITY MEET THE REQUIREMENTS OF SUBPARAGRAPHS (I)
AND  (II)  OF  THIS  PARAGRAPH  AND  MAY CONSIDER WHETHER THE ENTITY HAS
DEVELOPED THE PROGRAMS, SERVICES, AND ATTRIBUTES IN SUBPARAGRAPHS  (III)
THROUGH (XVI) OF THIS PARAGRAPH:
  (I)  INSTITUTIONAL  STABILITY  AND  LONG TERM VIABILITY, INDICATED BY:
THE SPONSOR'S COMMITMENT TO FINANCIALLY AND PROGRAMMATICALLY MAINTAINING
THE INCUBATOR FOR AT LEAST TWO YEARS IN ADDITION TO THE  CURRENT  FISCAL
YEAR; RECEIPT OF NON-STATE PUBLIC AND PRIVATE GRANT AND/OR OTHER REVENUE
SOURCES  INCLUDING  PROPERTY  RENTALS  AND PROGRAM FEES THAT ARE OR HAVE
PROVEN TO BE PREDICTABLE AND RELIABLE; AND MANAGEABLE DEBT SERVICE;
  (II) A STRATEGIC PLAN THAT DESCRIBES THE IMPACT ON THE REGIONAL ENTRE-
PRENEURIAL ENVIRONMENT THAT  THE  INCUBATOR  IS  INTENDED  TO  HAVE  AND
COMMITS  THE  INCUBATOR  TO  BEST  INCUBATION  PRACTICES AND DESCRIBES A
DEFINED PROCESS THAT ACCELERATES COMMERCIALIZATION AND DEVELOPMENT FOR A
CLIENT COMPANY OR ENTITY  THROUGH  PROVISION  OF  TECHNICAL  ASSISTANCE,
DIRECT  MENTORSHIP,  ENTREPRENEURIAL EDUCATION, AND BUSINESS DEVELOPMENT
SERVICES, INCLUDING DEVELOPMENT OF A BUSINESS PLAN AND MARKETS,  AID  IN
DEVELOPMENT  OF  THE  MANAGEMENT  TEAM, PRODUCT, CUSTOMERS, AND LOCAL OR
REGIONAL SUPPLY CHAIN PARTNERS, ACCESS TO INVESTMENT, AND LAUNCHING OF A
SUCCESSFUL BUSINESS WHICH WILL EMPLOY NEW YORKERS;
  (III) AN INTEGRATED ARRAY OF SERVICES WHICH INCLUDES MANAGEMENT  GUID-
ANCE,  TECHNICAL ASSISTANCE, CONSULTING, MENTORING, BUSINESS PLAN DEVEL-
OPMENT, AID IN CREATION OF THE BUSINESS ENTITY, AND ONGOING COUNSELING;
  (IV) OPPORTUNITIES FOR CLIENTS  TO  NETWORK,  COLLABORATE  WITH  OTHER
BUSINESS  PROGRAMS,  AND GAIN ACCESS TO SERVICES, INCLUDING THROUGH SUCH
PROGRAMS AS THE SMALL BUSINESS DEVELOPMENT CENTER,  THE  LOCAL  OR  AREA
CHAMBER OF COMMERCE OR OTHER BUSINESS ASSOCIATION, PROGRAMS OF THE SMALL
BUSINESS  ADMINISTRATION,  AND/OR  OTHER SIMILAR BUSINESS ORGANIZATIONS,
ASSOCIATIONS, AND PROGRAMS;
  (V) ACCESS TO CAPITAL VIA REFERRAL OR OTHER ARRANGEMENTS  WITH  FINAN-
CIAL  INSTITUTIONS,  VENTURE  CAPITALISTS,  ANGEL  INVESTORS, INVESTMENT

S. 2609--D                         17                         A. 3009--D

FUNDS MANAGED OR FINANCED BY PRIVATE ENTITIES OR STATE OR LOCAL ECONOMIC
DEVELOPMENT ORGANIZATIONS, OR OTHER SIMILAR OR EQUIVALENT CAPITAL SOURC-
ES, EVIDENCED  BY  WRITTEN  AGREEMENTS,  MEMORANDUMS  OF  UNDERSTANDING,
LETTERS  OF INTENT, OR OTHER ENDORSEMENTS ACCEPTABLE TO THE CORPORATION,
AND INCLUDING READYING CLIENTS FOR FINANCIAL MEETINGS AND INTERVIEWS;
  (VI) AID IN ACCESSING MARKETS, VIA BID ASSISTANCE OR  ACCESS  PROGRAMS
THAT MAY INCLUDE BUT ARE NOT LIMITED TO LITERATURE REVIEW, ESTABLISHMENT
OF  A RESOURCE DOCUMENTS ROOM (PHYSICAL OR VIRTUAL), OPPORTUNITY NOTIFI-
CATION OF LOCAL, STATE, AND FEDERAL GOVERNMENTAL  AND  PRIVATE  OPPORTU-
NITIES,  AND  IDENTIFICATION  OF  AND  INTRODUCTIONS  TO POTENTIAL FIRST
CUSTOMERS;
  (VII) PHYSICAL OFFICE SPACE AND/OR LABORATORY SPACE AND/OR MANUFACTUR-
ING SPACE UNDER A WRITTEN AGREEMENT FOR A  PERIOD  NOT  TO  EXCEED  FIVE
YEARS FOR ANY INDIVIDUAL INCUBATOR CLIENT;
  (VIII)  POLICIES  REQUIRING  PARTICIPATION BY CLIENTS IN THE INCUBATOR
PROGRAM, INCLUDING DISQUALIFICATION OR SUSPENSION FROM THE  PROGRAM  FOR
FAILURE TO PARTICIPATE;
  (IX)  CRITERIA FOR ACCEPTANCE AND GRADUATION FROM THE PROGRAM OR PHYS-
ICAL SPACE, AND TERMS AND CONDITIONS FOR ONGOING RELATIONSHIPS, IF  ANY,
BETWEEN THE INCUBATOR AND THE CLIENT;
  (X) AT LEAST FIFTY PERCENT OF THE TOTAL INCUBATOR BUDGET PROVIDED FROM
SOURCES  OTHER  THAN  TENANT RENTS AND FEES AND IN-KIND SUPPORT FROM THE
SPONSORING ENTITY, AND MUST BE FROM SOURCES OTHER THAN  NEW  YORK  STATE
GOVERNMENT AGENCIES;
  (XI) AN INDEPENDENT ADVISORY COUNCIL OR SIMILAR BODY THAT INCLUDES ONE
OR MORE EXECUTIVE OFFICERS OF FIRMS THAT HAVE GRADUATED FROM THE INCUBA-
TOR,  LOCAL  ECONOMIC  DEVELOPMENT  PROFESSIONALS,  AND INDIVIDUALS WITH
BUSINESS AND TECHNOLOGY EXPERTISE IN AREAS APPROPRIATE TO THE SECTOR  OR
CONCENTRATION OF CLIENTS, AND THE MISSION AND GOAL OF THE INCUBATOR;
  (XII) A PROFESSIONAL MANAGEMENT AND SERVICE DELIVERY TEAM WITH EXPERI-
ENCE,  EXPERTISE,  OR CREDENTIALS IN MANAGEMENT, ENTREPRENEURSHIP, BUSI-
NESS DEVELOPMENT, OR OTHER EQUIVALENT AREAS;
  (XIII) ACCESS  BY  CLIENTS  TO  MENTORING,  ADVISORY,  OR  EDUCATIONAL
SERVICES,  INCLUDING  CLASSROOM  TEACHING,  FROM  INDIVIDUALS  WHO  HAVE
SUCCESSFULLY CREATED,  GROWN  OR  MANAGED  BUSINESSES  OR  ARE  LAWYERS,
PROFESSIONAL ACCOUNTANTS, OR INDIVIDUALS WHO HAVE BEEN IN BUSINESS AT AN
EXECUTIVE LEVEL FOR AT LEAST FIVE YEARS;
  (XIV)  EVIDENCE  THAT  THE  INCUBATOR  IS  A CENTER OF ENTREPRENEURIAL
ACTIVITIES OF A CITY, REGION, OR DISTRESSED PORTION  THEREOF,  AS  DOCU-
MENTED  BY  PROGRAMS  AND  ACTIVITIES  COORDINATED  WITH COUNTY OR LOCAL
ECONOMIC DEVELOPMENT ORGANIZATIONS,  INVESTOR  AND  FINANCIAL  CLUBS  OR
INSTITUTIONS, OR STUDENT OR YOUTH-ORIENTED ENTREPRENEURIAL ACTIVITIES;
  (XV)  A  PARTNERSHIP  WITH  OTHER  INCUBATORS  IN  THE REGION TO OFFER
SERVICES AND  OPPORTUNITIES  FOR  ENTREPRENEURS  AND  LEVERAGE  REGIONAL
ECONOMIC DEVELOPMENT ASSETS; AND
  (XVI)  A  PLAN  TO  RECRUIT  MINORITY-  AND WOMEN-OWNED BUSINESSES FOR
LOCATION AND PARTICIPATION WITH THE INCUBATOR PROGRAM.
  (C) THE CORPORATION,  SUBJECT  TO  APPROPRIATIONS  PROVIDED  FOR  THIS
PURPOSE,  MAY  APPROVE  AND  DESIGNATE FIVE NEW YORK STATE INCUBATOR HOT
SPOTS IN FISCAL YEAR TWO THOUSAND  THIRTEEN-TWO  THOUSAND  FOURTEEN  AND
FIVE  ADDITIONAL  NEW YORK STATE INNOVATION HOT SPOTS IN FISCAL YEAR TWO
THOUSAND FOURTEEN-TWO THOUSAND FIFTEEN. SUCH DESIGNEES WILL BE  REQUIRED
TO  DEMONSTRATE  AN  AFFILIATION  WITH AND THE APPLICATION SUPPORT OF AT
LEAST ONE COLLEGE, UNIVERSITY OR INDEPENDENT RESEARCH  INSTITUTION,  AND
THAT  ITS  PROGRAMS  AND  PURPOSES ARE CONSISTENT WITH REGIONAL ECONOMIC
DEVELOPMENT STRATEGIES.

S. 2609--D                         18                         A. 3009--D

  3. DESIGNATION. (A) THE CORPORATION MAY DESIGNATE APPLICANTS THAT MEET
THE REQUIREMENTS OF SUBDIVISION TWO OF THIS SECTION AS  NEW  YORK  STATE
INNOVATION HOT SPOTS OR AS NEW YORK STATE INCUBATORS.
  (B)  AS  A  CONDITION OF MAINTAINING DESIGNATION, EACH INCUBATOR SHALL
ANNUALLY SUBMIT TO THE CORPORATION IN A MANNER AND ACCORDING TO A SCHED-
ULE ESTABLISHED BY THE CORPORATION:
  (I) UPDATED INFORMATION  REQUESTED  BY  THE  CORPORATION  PURSUANT  TO
SUBPARAGRAPH (III) OF PARAGRAPH (A) OF SUBDIVISION TWO OF THIS SECTION;
  (II)  ITS STRATEGIC PLAN, AS UPDATED ALONG WITH A BRIEF DESCRIPTION OF
ITS SUCCESS IN MEETING THE GOALS OF ITS STRATEGIC PLAN;
  (III) A STATEMENT THAT THE ITEMS LISTED IN PARAGRAPH (B)  OF  SUBDIVI-
SION  TWO  OF THIS SECTION AND, IN THE CASE OF NEW YORK STATE INNOVATION
HOT SPOTS, PARAGRAPH (C) OF SUBDIVISION TWO OF THIS  SECTION  ARE  STILL
APPLICABLE TO THE OPERATIONS OF THE INCUBATOR, OR ANY CHANGE IN APPLICA-
BILITY;
  (IV)  A  LIST  OF BUSINESS ENTERPRISES SERVED BY THE INCUBATOR, AND IN
THE CASE OF NEW YORK STATE INNOVATION HOT SPOTS, THOSE CLIENTS CERTIFIED
AS A "QUALIFIED ENTITY" ELIGIBLE FOR TAX INCENTIVES UNDER SECTION  THIR-
TY-EIGHT OF THE TAX LAW; AND
  (V) SUCH ADDITIONAL INFORMATION AS THE CORPORATION MAY REQUIRE.
  (C)  THE  CORPORATION  SHALL  DESIGN  SIMPLIFIED  FORMS  TO AID IN THE
SUBMISSION OF THE DATA  REQUIRED  IN  THIS  SUBDIVISION,  WHICH  MAY  BE
SUBMITTED  ELECTRONICALLY.  SUCH  FORMS  SHALL STATE THE PURPOSES OF THE
REQUIRED DATA SUBMISSIONS.
  (D) THE CORPORATION SHALL EVALUATE THE  OPERATIONS  OF  THE  NEW  YORK
STATE  INNOVATION HOT SPOT OR THE NEW YORK STATE INCUBATOR USING METHODS
INCLUDING BUT NOT LIMITED TO SITE VISITS, REPORTS PURSUANT TO  SPECIFIED
INFORMATION,  AND  REVIEW EVALUATIONS. IF THE CORPORATION IS UNSATISFIED
WITH THE PROGRESS OF A NEW YORK STATE INNOVATION HOT SPOT OR A NEW  YORK
STATE  INCUBATOR,  THE  CORPORATION  SHALL  NOTIFY SUCH INCUBATOR OF THE
RESULTS OF ITS EVALUATIONS AND  THE  FINDINGS  OF  DEFICIENCIES  IN  THE
INCUBATOR'S  OPERATIONS  AND  SHALL  ALLOW SUCH INCUBATOR TO REMEDY SUCH
FINDINGS IN A TIMELY MANNER. FOR NEW YORK STATE INNOVATION HOT SPOTS  OR
NEW  YORK  STATE  INCUBATORS  THAT  RECEIVE OPERATING GRANTS PURSUANT TO
PARAGRAPH (A) OF SUBDIVISION FIVE  OF  THIS  SECTION,  SUCH  EVALUATIONS
SHALL  INCLUDE INDEPENDENT PEER REVIEW AND SHALL TAKE PLACE NO LESS THAN
ONCE EVERY THREE YEARS OR MORE  FREQUENTLY  AT  THE  DISCRETION  OF  THE
CORPORATION.  SUCH  INDEPENDENT  PEER  REVIEW  SHALL RESULT IN A WRITTEN
REPORT THAT INCLUDES PROGRAMMATIC AND FISCAL  EVALUATION  OF  THE  INCU-
BATION PROGRAM AND RECOMMENDATIONS FOR IMPROVEMENT.
  4.  AUDIT.  THE CORPORATION SHALL HAVE THE AUTHORITY TO AUDIT NEW YORK
INNOVATION HOT SPOTS, NEW YORK STATE INCUBATORS AND  CLIENTS  DESIGNATED
BY SUCH HOT SPOTS AS QUALIFIED ENTITIES.
  5.  GRANTS.  (A)  OPERATING GRANTS. A PROGRAM DESIGNATED AS A NEW YORK
STATE INNOVATION HOT SPOT OR AS A NEW  YORK  STATE  INCUBATOR  SHALL  BE
ELIGIBLE  FOR  AN  OPERATING  GRANT IN AN AMOUNT TO BE DETERMINED BY THE
CORPORATION FROM FUNDS APPROPRIATED TO THE CORPORATION FOR SUCH PURPOSE,
PROVIDED HOWEVER THAT:
  (I) ANY SUCH GRANT SHALL BE MATCHED  ON  A  TWO-TO-ONE  BASIS  BY  THE
INSTITUTION  RECEIVING  THE FUNDS AND COLLABORATIVE PARTNERS IN THE FORM
OF CASH OR IN-KIND PERSONNEL, EQUIPMENT, MATERIAL DONATIONS,  AND  OTHER
FACILITY  AND  OPERATIONS EXPENDITURES, PROVIDED THAT NO MORE THAN FIFTY
PERCENT OF SUCH MATCH SHALL BE IN-KIND;
  (II) A PROGRAM  APPLYING  FOR  A  GRANT  SHALL  DEMONSTRATE  FINANCIAL
STABILITY  AND  LONG  TERM VIABILITY, AS PROVIDED IN SUBPARAGRAPH (I) OF
PARAGRAPH (B) OF SUBDIVISION TWO OF THIS SECTION;

S. 2609--D                         19                         A. 3009--D

  (III) A GRANT RECIPIENT SHALL AGREE TO PROVIDE DATA AS REQUIRED TO THE
CORPORATION AND SHALL AGREE TO CONFORM TO BEST PRACTICES AS OUTLINED  BY
STATE AND/OR NATIONAL BUSINESS INCUBATOR ASSOCIATIONS;
  (IV)  FAILURE  TO  ABIDE BY THE REQUIREMENTS OF THIS SUBDIVISION OR TO
CURE A DEFAULT AFTER REVIEW AND AGREEMENT  WITH  THE  CORPORATION  SHALL
RESULT  IN  LOSS  OF THE GRANT AND DISQUALIFICATION OF THE DESIGNEE AS A
NEW YORK STATE INNOVATION HOT SPOT OR AS A NEW YORK STATE INCUBATOR; AND
  (V) PROVIDED THAT A PORTION OF THE GRANTS SHALL BE AWARDED TO THE  NEW
YORK STATE INNOVATION HOT SPOTS AND THE NEW YORK STATE INCUBATORS.
  (B)  THE  CORPORATION SHALL MAKE ENTITIES DESIGNATED AS NEW YORK STATE
INNOVATION HOT SPOTS OR AS NEW YORK STATE INCUBATORS AWARE  OF  OPPORTU-
NITIES  FOR  FUNDING  OR  GRANTS  BY  OR  THROUGH THE CORPORATION OR THE
DEPARTMENT OF ECONOMIC DEVELOPMENT.
  (C) NO DEDUCTION. IN ADDITION TO THE FOREGOING REQUIREMENTS, AN  INCU-
BATOR  SPONSOR  SHALL  AGREE  TO  DEDICATE  ALL FUNDS FROM ANY GRANTS OR
SUPPORT RECEIVED PURSUANT TO THIS SUBDIVISION TO THE OPERATIONS  OF  THE
INCUBATOR WITHOUT DEDUCTIONS FOR OVERHEAD, INDIRECT COSTS, OR FACILITIES
AND ADMINISTRATION CHARGES OF SUCH SPONSOR.
  6.  OTHER  ASSISTANCE.  THE  CORPORATION  SHALL  MAKE  SUCH OTHER AID,
ASSISTANCE, AND RESOURCES AVAILABLE TO NEW  YORK  STATE  INNOVATION  HOT
SPOTS  AND  NEW YORK STATE INCUBATORS AND THEIR CLIENTS AS IT SHALL DEEM
USEFUL AND APPROPRIATE FOR THE FURTHERANCE OF THE PURPOSES OF THIS  ACT,
INCLUDING WITHOUT LIMITATION TECHNICAL ASSISTANCE, AID IN MARKETING, AID
IN  REACHING  AND  PROVIDING  ENTREPRENEURSHIP TRAINING OPPORTUNITIES TO
SUCH MARGINALIZED GROUPS AS THOSE COMPOSED OF INDIVIDUALS WHO ARE MINOR-
ITY, FEMALE, DISABLED, OR POOR, AND OTHERS, CURRICULUM DEVELOPMENT,  AND
OTHER SERVICES AND RESOURCES. THE CORPORATION SHALL ALSO SEEK ASSISTANCE
FROM  OTHER STATE AGENCIES IN THE DEVELOPMENT OF PROCUREMENT AND MARKET-
ING RESOURCES AND TRAINING OPPORTUNITIES FOR NEW YORK  STATE  INNOVATION
HOT SPOTS AND NEW YORK STATE INCUBATORS AND THEIR CLIENTS.
  7.  ASSOCIATION  OF  INCUBATORS.    THE CORPORATION MAY CONSULT WITH A
STATEWIDE ENTITY WHICH IS A MEMBERSHIP  ASSOCIATION  OF  INCUBATORS  AND
OTHERS  AND  WHICH HAS EXPERTISE IN PROVIDING SERVICES TO INCUBATORS FOR
THE PURPOSE OF PROVIDING SERVICES TO ENTITIES  DESIGNATED  AS  NEW  YORK
STATE INNOVATION HOT SPOTS AND NEW YORK STATE INCUBATORS AND TO ENTITIES
SEEKING  TO  APPLY  OR  APPLYING TO BECOME NEW YORK STATE INNOVATION HOT
SPOTS AND NEW YORK STATE INCUBATORS OR WHICH OTHERWISE ARE  INCLUDED  AS
RECIPIENTS  OF  SERVICES  PURSUANT  TO THIS SECTION. SUCH SERVICES SHALL
INCLUDE ADVISING CONCERNING BEST PRACTICES OF INCUBATION AND DEVELOPMENT
OF PLANS TO INCORPORATE AND INTEGRATE  SUCH  PRACTICES,  DEVELOPMENT  OF
DATA  CONCERNING  INCUBATION  IN  THIS  STATE  AND  RECOMMENDATIONS  FOR
IMPROVEMENT, AID IN MARKETING AND  EVENT  SPONSORSHIP,  AND  SUCH  OTHER
SERVICES  AS THE CORPORATION SHALL DEEM NECESSARY AND APPROPRIATE TO THE
STRENGTHENING OF BUSINESS INCUBATION IN THIS STATE.
  8. NEW YORK STATE INNOVATION HOT SPOTS MAY CERTIFY CLIENTS WHICH  MEET
THE  REQUIREMENTS OF SUBDIVISION NINE OF THIS SECTION AS QUALIFIED ENTI-
TIES ELIGIBLE FOR NEW YORK STATE INNOVATION HOT SPOT PROGRAM  TAX  BENE-
FITS  PURSUANT  TO SECTION THIRTY-EIGHT OF THE TAX LAW. UNDER NO CIRCUM-
STANCE MAY BUSINESS ENTERPRISES OF INCUBATORS  DESIGNATED  AS  NEW  YORK
STATE  INCUBATORS UNDER PARAGRAPH (B) OF SUBDIVISION ONE OF THIS SECTION
BE ELIGIBLE FOR TAX BENEFITS UNDER SECTION THIRTY-EIGHT OF THE TAX LAW.
  9. "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:

S. 2609--D                         20                         A. 3009--D

  (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 SECTION ONE HUNDRED EIGHTY-SIX OF ARTICLE NINE; ARTICLE THIR-
TY-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 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 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 OF  THE
TAX LAW; AND
  (IV)  IS  CERTIFIED  BY  A NEW YORK STATE INNOVATION HOT SPOT AS BEING
APPROVED TO LOCATE IN, OR BE PART OF A VIRTUAL INCUBATION PROGRAM  OPER-
ATED BY, SUCH NEW YORK INNOVATION HOT SPOT.
  10.  THE  CORPORATION MAY ESTABLISH GUIDELINES CONCERNING THIS PROGRAM
TO IMPLEMENT THE PURPOSES OF THIS ACT.
  S 2. 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 "NEW YORK  STATE  INNOVATION  HOT  SPOT"  AND
"QUALIFIED  ENTITY"  SHALL  HAVE  THE  SAME  MEANING  AS  UNDER  SECTION
SIXTEEN-V OF THE NEW YORK STATE URBAN DEVELOPMENT CORPORATION ACT.
  (B) A TAXPAYER UNDER ARTICLE NINE-A OF THIS CHAPTER THAT IS  A  QUALI-
FIED  ENTITY  OF  A  NEW YORK STATE 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 OR PART OF 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 TAXA-
BLE  INCOME TO THE EXTENT THAT THE INCOME OR GAIN IS ATTRIBUTABLE TO THE
OPERATIONS AT OR AS PART OF 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  OR  PART  OF  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

S. 2609--D                         21                         A. 3009--D

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 AT OR AS A PART OF
A NEW YORK STATE 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 OR PART OF AN INNOVATION HOT SPOT.
  (D) A QUALIFIED ENTITY THAT IS A TENANT IN OR PART OF A NEW YORK STATE
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 INCUBATOR
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 OR AS PART  OF  THE  NEW  YORK  STATE
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  3.  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 A NEW  YORK  STATE  INNO-
VATION  HOT  SPOT, TO THE EXTENT THAT THE INCOME OR GAIN IS ATTRIBUTABLE
TO THE OPERATIONS OF A QUALIFIED ENTITY AT OR AS PART OF  THE  NEW  YORK
STATE  INNOVATION  HOT  SPOT AS PROVIDED IN SECTION THIRTY-EIGHT OF THIS
CHAPTER.
  S 4. 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 OF A NEW  YORK  STATE  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 5. 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-

S. 2609--D                         22                         A. 3009--D

FIED ENTITY AT ITS LOCATION IN OR AS PART OF A NEW YORK STATE INNOVATION
HOT SPOT, AS PROVIDED IN SECTION THIRTY-EIGHT OF THIS CHAPTER.
  S 6. 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 OR PART OF A NEW
YORK  STATE  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 predomi-
nantly, or such a service described in clause (A) or  (D)  of  paragraph
one of such subdivision (b) of section eleven hundred five of this arti-
cle  is directly and exclusively, used or consumed by (I) such QUALIFIED
EMPIRE ZONE enterprise in an area designated as an empire zone  pursuant
to article eighteen-B of the general municipal law with respect to which
such  enterprise  is  certified  pursuant to such article eighteen-B, OR
(II) SUCH QUALIFIED ENTITY AT ITS LOCATION IN OR AS PART OF A  NEW  YORK
STATE  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  ITS
LOCATION IN OR AS PART OF THE NEW YORK STATE INNOVATION HOT SPOT, or (C)
the  enterprise's place of primary use of the service described in para-
graph two of such subdivision (b) of section eleven hundred five  is  at
an address in such empire zone OR AT ITS LOCATION IN OR AS PART OF A NEW
YORK  STATE 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 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 7. 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 SECTION SIXTEEN-V  OF  THE  NEW  YORK  STATE  URBAN

S. 2609--D                         23                         A. 3009--D

DEVELOPMENT CORPORATION ACT ATTRIBUTABLE TO THE OPERATIONS OF SUCH QUAL-
IFIED  ENTITY  AT  ITS  LOCATION IN OR AS PART OF A NEW YORK STATE INNO-
VATION HOT SPOT, AS DEFINED IN  PARAGRAPH  (A)  OF  SUBDIVISION  ONE  OF
SECTION  SIXTEEN-V  OF  THE NEW YORK STATE URBAN DEVELOPMENT CORPORATION
ACT.
  S 8. 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
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

S. 2609--D                         24                         A. 3009--D

  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-
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

S. 2609--D                         25                         A. 3009--D

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
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-

S. 2609--D                         26                         A. 3009--D

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".
  (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

S. 2609--D                         27                         A. 3009--D

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
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

S. 2609--D                         28                         A. 3009--D

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
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

S. 2609--D                         29                         A. 3009--D

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,
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

S. 2609--D                         30                         A. 3009--D

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
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

S. 2609--D                         31                         A. 3009--D

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-
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.

S. 2609--D                         32                         A. 3009--D

  (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
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.

S. 2609--D                         33                         A. 3009--D

  (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
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-

S. 2609--D                         34                         A. 3009--D

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)
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

S. 2609--D                         35                         A. 3009--D

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
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

S. 2609--D                         36                         A. 3009--D

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,
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

S. 2609--D                         37                         A. 3009--D

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
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-

S. 2609--D                         38                         A. 3009--D

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,
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.

S. 2609--D                         39                         A. 3009--D

  (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
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.

S. 2609--D                         40                         A. 3009--D

  (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
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

S. 2609--D                         41                         A. 3009--D

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:
  (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

S. 2609--D                         42                         A. 3009--D

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
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

S. 2609--D                         43                         A. 3009--D

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.
  (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

S. 2609--D                         44                         A. 3009--D

[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.
  (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

S. 2609--D                         45                         A. 3009--D

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.
  (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 AS OF JANUARY FIRST OF EACH
YEAR USING THE MOST RECENT FIVE YEAR ESTIMATE FROM THE AMERICAN COMMUNI-
TY SURVEY PUBLISHED BY THE UNITED STATES CENSUS BUREAU.
  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:

S. 2609--D                         46                         A. 3009--D

  (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 AS OF JANUARY FIRST OF EACH
YEAR USING THE MOST RECENT FIVE YEAR ESTIMATE FROM THE AMERICAN COMMUNI-
TY SURVEY PUBLISHED BY THE UNITED STATES CENSUS BUREAU.
  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
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

S. 2609--D                         47                         A. 3009--D

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 AS OF JANUARY  FIRST  OF  EACH
YEAR USING THE MOST RECENT FIVE YEAR ESTIMATE FROM THE AMERICAN COMMUNI-
TY SURVEY PUBLISHED BY THE UNITED STATES CENSUS BUREAU.
  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
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

S. 2609--D                         48                         A. 3009--D

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 AS OF JANUARY FIRST OF EACH
YEAR USING THE MOST RECENT FIVE YEAR ESTIMATE FROM THE AMERICAN COMMUNI-
TY SURVEY PUBLISHED BY THE UNITED STATES CENSUS BUREAU.
  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] AND ELECTRIC VEHICLE RECHARGING
PROPERTY 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 AND 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  AND  ELECTRIC  VEHICLE
RECHARGING PROPERTY.  The credit under this section for alternative fuel
vehicle  refueling  AND 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  subsection  (p)  of
section  six  hundred six of this chapter] WHICH CONSTITUTES ALTERNATIVE
FUEL VEHICLE REFUELING PROPERTY OR 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.

S. 2609--D                         49                         A. 3009--D

  3. Definitions. (a) The term "alternative fuel vehicle refueling prop-
erty" MEANS ALL OF THE EQUIPMENT NEEDED TO DISPENSE ANY  FUEL  AT  LEAST
EIGHTY-FIVE  PERCENT  OF  THE VOLUME OF WHICH CONSISTS OF ONE OR MORE OF
THE FOLLOWING: NATURAL GAS, LIQUIFIED NATURAL GAS, LIQUIFIED  PETROLEUM,
OR HYDROGEN.
  (B)  THE  TERM  "ELECTRIC VEHICLE RECHARGING PROPERTY" means [any such
property which is qualified within the meaning of section  thirty  C  of
the  internal revenue code, but shall not include alternative fuel vehi-
cle refueling 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 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 OR 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  OR 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] ALTERNATIVE FUEL VEHICLE  REFUEL-
ING PROPERTY OR ELECTRIC VEHICLE RECHARGING PROPERTY; 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:
  24. Alternative fuels AND 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 alter-
native fuel vehicle refueling AND ELECTRIC VEHICLE  RECHARGING  property
placed in service during the taxable year.

S. 2609--D                         50                         A. 3009--D

  (b)  Alternative  fuel vehicle refueling property AND ELECTRIC VEHICLE
RECHARGING PROPERTY.  The credit under this subdivision for  alternative
fuel  vehicle  refueling  AND 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 CONSTITUTES ALTERNATIVE FUEL  VEHICLE
REFUELING PROPERTY OR ELECTRIC VEHICLE RECHARGING PROPERTY; 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.  (I)  The  term  "alternative fuel vehicle refueling
property" MEANS ALL OF THE EQUIPMENT NEEDED  TO  DISPENSE  ANY  FUEL  AT
LEAST EIGHTY-FIVE PERCENT OF THE VOLUME OF WHICH CONSISTS OF ONE OR MORE
OF THE FOLLOWING: NATURAL GAS, LIQUIFIED NATURAL GAS, LIQUIFIED PETROLE-
UM, OR HYDROGEN.
  (II)  THE  TERM "ELECTRIC VEHICLE RECHARGING PROPERTY" means [any such
property 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 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 OR 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 OR 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] ALTERNATIVE FUEL VEHICLE REFUEL-
ING PROPERTY OR ELECTRIC VEHICLE RECHARGING PROPERTY; 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--D                         51                         A. 3009--D

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)] Termination. The credit allowed by paragraph (b) of this subdivi-
sion 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 AND 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 AND ELECTRIC VEHICLE RECHARGING prop-
erty placed in service during the taxable year.
  (2) Alternative fuel vehicle refueling property AND  ELECTRIC  VEHICLE
RECHARGING  PROPERTY.   The credit under this subsection for [clean-fuel
vehicle refueling] ALTERNATIVE FUEL VEHICLE REFUELING PROPERTY OR  ELEC-
TRIC  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
CONSTITUTES  ALTERNATIVE  FUEL  VEHICLE  REFUELING  PROPERTY OR ELECTRIC
VEHICLE RECHARGING PROPERTY; AND

S. 2609--D                         52                         A. 3009--D

  (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" MEANS ALL OF THE EQUIPMENT NEEDED  TO  DISPENSE  ANY  FUEL  AT
LEAST EIGHTY-FIVE PERCENT OF THE VOLUME OF WHICH CONSISTS OF ONE OR MORE
OF THE FOLLOWING: NATURAL GAS, LIQUIFIED NATURAL GAS, LIQUIFIED PETROLE-
UM, OR HYDROGEN; AND
  (B)  THE  TERM  "ELECTRIC VEHICLE RECHARGING PROPERTY" means [any such
property 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, ALTERNATIVE FUEL VEHICLE REFUELING  PROPERTY
OR ELECTRIC VEHICLE RECHARGING PROPERTY ceases to be qualified, a recap-
ture  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]  ALTER-
NATIVE  FUEL  VEHICLE  REFUELING PROPERTY OR ELECTRIC 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] ALTERNATIVE FUEL VEHICLE
REFUELING PROPERTY OR ELECTRIC VEHICLE RECHARGING PROPERTY, or

S. 2609--D                         53                         A. 3009--D

  [(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.
  [(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
AND 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. Section 23 of part U of chapter 61  of  the  laws  of  2011
amending the real property tax law and other laws relating to establish-
ing  standards  for  electronic  real  property  tax  administration, 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]
2016, provided however that the amendments to paragraph 4 of subdivision
(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--D                         54                         A. 3009--D

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;
  (d) sections fourteen-b, fifteen-b, sixteen-a and seventeen-a of  this
act shall take effect January 1, [2014] 2017 but only if the commission-
er  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; and
  (e) sections twenty-one and twenty-one-a of this act shall expire  and
be deemed repealed December 31, [2013] 2016.
  S 2. This act shall take effect immediately.

                                 PART I

  Intentionally omitted

                                 PART J

  Section 1. Section 862 of the general municipal law, as added by chap-
ter 1030 of the laws of 1969, is amended to read as follows:
  S 862. Restrictions on funds of the agency. (1) No funds of the agency
shall  be used in respect of any project if the completion thereof would
result in the removal of an industrial or  manufacturing  plant  of  the
project occupant from one area of the state to another area of the state
or in the abandonment of one or more plants or facilities of the project
occupant  located  within  the  state,  provided,  however, that neither
restriction shall apply if the agency shall determine on  the  basis  of
the  application  before  it that the project is reasonably necessary to
discourage the project occupant from removing such other plant or facil-
ity to a location outside  the  state  or  is  reasonably  necessary  to
preserve the competitive position of the project occupant in its respec-
tive industry.
  (2)  (A)  EXCEPT  AS PROVIDED IN PARAGRAPH (B) OF THIS SUBDIVISION, NO
FINANCIAL ASSISTANCE OF THE AGENCY SHALL BE PROVIDED IN RESPECT  OF  ANY
PROJECT  WHERE  FACILITIES OR PROPERTY THAT ARE PRIMARILY USED IN MAKING
RETAIL SALES TO CUSTOMERS WHO PERSONALLY VISIT SUCH  FACILITIES  CONSTI-
TUTE  MORE THAN ONE-THIRD OF THE TOTAL PROJECT COST. FOR THE PURPOSES OF
THIS ARTICLE, "RETAIL SALES" SHALL  MEAN:  (I)  SALES  BY  A  REGISTERED
VENDOR  UNDER  ARTICLE  TWENTY-EIGHT OF THE TAX LAW PRIMARILY ENGAGED IN
THE RETAIL SALE OF TANGIBLE PERSONAL PROPERTY, AS  DEFINED  IN  SUBPARA-
GRAPH (I) OF PARAGRAPH FOUR OF SUBDIVISION (B) OF SECTION ELEVEN HUNDRED
ONE  OF  THE  TAX  LAW;  OR  (II)  SALES OF A SERVICE TO SUCH CUSTOMERS.
EXCEPT, HOWEVER, THAT TOURISM DESTINATION PROJECTS SHALL NOT BE  PROHIB-
ITED  BY  THIS  SUBDIVISION. FOR THE PURPOSE OF THIS PARAGRAPH, "TOURISM
DESTINATION" SHALL MEAN A  LOCATION  OR  FACILITY  WHICH  IS  LIKELY  TO
ATTRACT  A  SIGNIFICANT  NUMBER  OF  VISITORS  FROM OUTSIDE THE ECONOMIC
DEVELOPMENT REGION AS ESTABLISHED BY SECTION TWO HUNDRED THIRTY  OF  THE
ECONOMIC DEVELOPMENT LAW, IN WHICH THE PROJECT IS LOCATED.

S. 2609--D                         55                         A. 3009--D

  (B)  NOTWITHSTANDING  THE PROVISIONS OF PARAGRAPH (A) OF THIS SUBDIVI-
SION, FINANCIAL ASSISTANCE MAY, HOWEVER, BE PROVIDED TO A PROJECT  WHERE
FACILITIES OR PROPERTY THAT ARE PRIMARILY USED IN MAKING RETAIL SALES OF
GOODS  OR  SERVICES TO CUSTOMERS WHO PERSONALLY VISIT SUCH FACILITIES TO
OBTAIN  SUCH  GOODS  OR  SERVICES  CONSTITUTE MORE THAN ONE-THIRD OF THE
TOTAL PROJECT COST, WHERE:  (I) THE PREDOMINANT PURPOSE OF  THE  PROJECT
WOULD  BE  TO  MAKE AVAILABLE GOODS OR SERVICES WHICH WOULD NOT, BUT FOR
THE PROJECT, BE REASONABLY ACCESSIBLE TO  THE  RESIDENTS  OF  THE  CITY,
TOWN,  OR  VILLAGE  WITHIN  WHICH  THE PROPOSED PROJECT WOULD BE LOCATED
BECAUSE OF A LACK  OF  REASONABLY  ACCESSIBLE  RETAIL  TRADE  FACILITIES
OFFERING  SUCH  GOODS  OR  SERVICES; OR (II) THE PROJECT IS LOCATED IN A
HIGHLY DISTRESSED AREA.
  (C) WITH RESPECT TO PROJECTS AUTHORIZED PURSUANT TO PARAGRAPH  (B)  OF
THIS  SUBDIVISION,  NO PROJECT SHALL BE APPROVED UNLESS THE AGENCY SHALL
FIND  AFTER  THE  PUBLIC  HEARING  REQUIRED  BY  SECTION  EIGHT  HUNDRED
FIFTY-NINE-A  OF  THIS TITLE THAT UNDERTAKING THE PROJECT WILL SERVE THE
PUBLIC PURPOSES OF THIS ARTICLE BY PRESERVING PERMANENT, PRIVATE  SECTOR
JOBS  OR INCREASING THE OVERALL NUMBER OF PERMANENT, PRIVATE SECTOR JOBS
IN THE STATE. WHERE THE AGENCY MAKES SUCH A FINDING, PRIOR TO  PROVIDING
FINANCIAL  ASSISTANCE  TO THE PROJECT BY THE AGENCY, THE CHIEF EXECUTIVE
OFFICER OF THE MUNICIPALITY FOR WHOSE BENEFIT  THE  AGENCY  WAS  CREATED
SHALL CONFIRM THE PROPOSED ACTION OF THE AGENCY.
  S  2. 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. 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 COMMIS-
SIONER UPON REQUEST. SUCH IDA SHALL ALSO, WITHIN THIRTY DAYS OF  PROVID-
ING  FINANCIAL ASSISTANCE TO A PROJECT THAT INCLUDES ANY AMOUNT OF STATE
SALES AND USE TAX EXEMPTION BENEFITS, REPORT  TO  THE  COMMISSIONER  THE
AMOUNT  OF SUCH BENEFITS FOR SUCH PROJECT, THE PROJECT TO WHICH THEY ARE
BEING PROVIDED, TOGETHER WITH SUCH OTHER INFORMATION AND SUCH SPECIFICI-
TY AND DETAIL AS THE COMMISSIONER MAY PRESCRIBE.   THIS  REPORT  MAY  BE
MADE  IN  CONJUNCTION WITH THE STATEMENT REQUIRED BY SUBDIVISION NINE OF
SECTION EIGHT HUNDRED SEVENTY-FOUR OF THIS TITLE OR IT MAY BE MADE AS  A
SEPARATE  REPORT,  AT  THE  DISCRETION OF THE COMMISSIONER.  AN IDA THAT
FAILS TO MAKE SUCH RECORDS AVAILABLE TO THE COMMISSIONER OR TO FILE SUCH
REPORTS 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.
  3. (A) AN IDA SHALL INCLUDE WITHIN ITS RESOLUTIONS AND  PROJECT  DOCU-
MENTS  ESTABLISHING ANY PROJECT OR APPOINTING AN AGENT OR PROJECT OPERA-
TOR FOR ANY PROJECT THE TERMS AND CONDITIONS IN  THIS  SUBDIVISION,  AND
EVERY AGENT, PROJECT OPERATOR OR OTHER PERSON OR ENTITY THAT SHALL ENJOY
STATE  SALES  AND  USE  TAX  EXEMPTION BENEFITS PROVIDED BY AN IDA SHALL
AGREE TO SUCH TERMS AS A CONDITION PRECEDENT TO RECEIVING OR  BENEFITING
FROM SUCH STATE SALES AND USE EXEMPTIONS BENEFITS.

S. 2609--D                         56                         A. 3009--D

  (B)  THE  IDA  SHALL  RECOVER, RECAPTURE, RECEIVE, OR OTHERWISE OBTAIN
FROM AN AGENT, PROJECT OPERATOR OR OTHER PERSON OR  ENTITY  STATE  SALES
AND  USE  EXEMPTIONS BENEFITS TAKEN OR PURPORTED TO BE TAKEN BY ANY SUCH
PERSON TO WHICH THE PERSON IS NOT ENTITLED OR WHICH ARE IN EXCESS OF THE
AMOUNTS  AUTHORIZED OR WHICH ARE FOR PROPERTY OR SERVICES NOT AUTHORIZED
OR TAKEN IN CASES WHERE SUCH AGENT OR PROJECT OPERATOR, OR OTHER  PERSON
OR  ENTITY  FAILED  TO  COMPLY  WITH A MATERIAL TERM OR CONDITION TO USE
PROPERTY OR SERVICES IN THE MANNER REQUIRED BY  THE  PERSON'S  AGREEMENT
WITH  THE IDA. SUCH AGENT OR PROJECT OPERATOR, OR OTHER PERSON OR ENTITY
SHALL COOPERATE WITH THE IDA  IN  ITS  EFFORTS  TO  RECOVER,  RECAPTURE,
RECEIVE,  OR  OTHERWISE OBTAIN SUCH STATE SALES AND USE EXEMPTIONS BENE-
FITS AND SHALL PROMPTLY PAY OVER ANY SUCH AMOUNTS TO  THE  IDA  THAT  IT
REQUESTS.    THE  FAILURE  TO  PAY OVER SUCH AMOUNTS TO THE IDA SHALL BE
GROUNDS FOR THE COMMISSIONER TO ASSESS AND DETERMINE STATE SALES AND USE
TAXES DUE FROM THE PERSON UNDER ARTICLE TWENTY-EIGHT  OF  THE  TAX  LAW,
TOGETHER WITH ANY RELEVANT PENALTIES AND INTEREST DUE ON SUCH AMOUNTS.
  (C)  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.
  (D)  AN  IDA  SHALL  PREPARE AN ANNUAL COMPLIANCE REPORT DETAILING ITS
TERMS AND CONDITIONS DESCRIBED IN PARAGRAPH (A) OF THIS SUBDIVISION  AND
ITS  ACTIVITIES AND EFFORTS TO RECOVER, RECAPTURE, RECEIVE, OR OTHERWISE
OBTAIN STATE SALES AND USE EXEMPTIONS BENEFITS  DESCRIBED  IN  PARAGRAPH
(B)  OF  THIS  SUBDIVISION,  TOGETHER WITH SUCH OTHER INFORMATION AS THE
COMMISSIONER AND THE COMMISSIONER OF ECONOMIC DEVELOPMENT  MAY  REQUIRE.
THE  REPORT REQUIRED BY THIS SUBDIVISION SHALL BE FILED WITH THE COMMIS-
SIONER, THE DIRECTOR OF THE DIVISION OF THE BUDGET, THE COMMISSIONER  OF
ECONOMIC  DEVELOPMENT,  THE STATE COMPTROLLER, THE GOVERNING BODY OF THE
MUNICIPALITY FOR WHOSE BENEFIT  THE  AGENCY  WAS  CREATED,  AND  MAY  BE
INCLUDED  WITH  THE ANNUAL FINANCIAL STATEMENT REQUIRED BY PARAGRAPH (B)
OF SUBDIVISION ONE OF SECTION EIGHT HUNDRED FIFTY-NINE  OF  THIS  TITLE.
SUCH  REPORT  REQUIRED  BY THIS SUBDIVISION SHALL BE FILED REGARDLESS OF
WHETHER THE IDA IS REQUIRED TO FILE SUCH FINANCIAL  STATEMENT  DESCRIBED
BY  SUCH  PARAGRAPH  (B)  OF  SUBDIVISION  ONE  OF SECTION EIGHT HUNDRED
FIFTY-NINE. THE FAILURE TO FILE OR  SUBSTANTIALLY  COMPLETE  THE  REPORT
REQUIRED  BY  THIS SUBDIVISION SHALL BE DEEMED TO BE THE FAILURE TO FILE
OR SUBSTANTIALLY COMPLETE THE STATEMENT REQUIRED BY SUCH  PARAGRAPH  (B)
OF  SUBDIVISION  ONE  OF  SUCH SECTION EIGHT HUNDRED FIFTY-NINE, AND THE
CONSEQUENCES SHALL BE THE SAME AS PROVIDED IN PARAGRAPH (E) OF  SUBDIVI-
SION ONE OF SUCH SECTION EIGHT HUNDRED FIFTY-NINE.
  (E) 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 RECOV-
ERED, 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

S. 2609--D                         57                         A. 3009--D

PAYMENTS  THAT  AN  IDA  RECOVERS,  RECAPTURES,  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 OTHER-
WISE, AS TRUSTEE FOR AND ON ACCOUNT OF THE STATE.
  4. 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
COMMENCED  BY  AN  IDA, TOGETHER WITH ANY INTEREST OR PENALTIES THEREON,
PURSUANT TO SUBDIVISION THREE 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.
  5. 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.
  6.  THE  COMMISSIONER  IS  HEREBY  AUTHORIZED  TO  AUDIT  THE RECORDS,
ACTIONS, AND PROCEEDINGS OF AN IDA AND OF ITS AGENTS AND PROJECT  OPERA-
TORS  TO ENSURE THAT THE IDA AND ITS AGENTS AND PROJECT OPERATORS COMPLY
WITH ALL THE REQUIREMENTS OF THIS SECTION. ANY INFORMATION  THE  COMMIS-
SIONER FINDS IN THE COURSE OF SUCH AUDIT MAY BE USED BY THE COMMISSIONER
TO  ASSESS  AND  DETERMINE  STATE  AND LOCAL TAXES OF THE IDA'S AGENT OR
PROJECT OPERATOR.
  7. IN ADDITION TO ANY OTHER REPORTING OR FILING  REQUIREMENTS  AN  IDA
HAS  UNDER  THIS ARTICLE OR OTHER LAW, AN IDA SHALL ALSO REPORT AND MAKE
AVAILABLE ON THE INTERNET, WITHOUT CHARGE, COPIES OF ITS RESOLUTIONS AND
AGREEMENTS APPOINTING AN AGENT OR PROJECT OPERATOR OR OTHERWISE  RELATED
TO  ANY  PROJECT  IT ESTABLISHES. IT SHALL ALSO PROVIDE, WITHOUT CHARGE,
COPIES OF ALL SUCH REPORTS AND INFORMATION TO A PERSON WHO ASKS  FOR  IT
IN  WRITING  OR  IN  PERSON. THE IDA MAY, AT THE REQUEST OF ITS AGENT OR
PROJECT OPERATOR DELETE FROM ANY SUCH COPIES POSTED ON THE  INTERNET  OR
PROVIDED  TO  A  PERSON  DESCRIBED IN THE PRIOR SENTENCE PORTIONS OF ITS

S. 2609--D                         58                         A. 3009--D

RECORDS THAT ARE SPECIFICALLY EXEMPTED FROM DISCLOSURE UNDER ARTICLE SIX
OF THE PUBLIC OFFICERS LAW.
  8.  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.
  9.  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  3.  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
TO THE PROVISIONS OF THIS TITLE AND TO THE  AUTHORITY  CREATED  BY  THIS
TITLE.
  S  4.  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  5.  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

S. 2609--D                         59                         A. 3009--D

deemed  officers  or employees of the county, city, village, or town for
whose benefit such agency or authority is established OR CREATED.
  S  6.  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 7. 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  8.  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

S. 2609--D                         60                         A. 3009--D

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 9. 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
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. 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

S. 2609--D                         61                         A. 3009--D

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 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 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  12.  This  act shall take effect immediately and shall apply to (a)
any project established, agent or project operator appointed on or after
the date this act shall have become a law and any  financial  assistance
or  agreement  regarding payments in lieu of taxes provided thereto, (b)
any amendment or revision involving additional funds or benefits made on
or after the date this act shall have become a law to any project estab-
lished,  agent  or  project  operator  appointed,  financial  assistance
provided,  or payment in lieu of taxes entered into, prior to that date,
and (c) any state sales and compensating use tax exemption benefits  and
any  payments  in  lieu of state sales and compensating use taxes recov-
ered, recaptured, received,  or  otherwise  obtained  by  an  industrial
development agency established by the general municipal law or an indus-
trial development authority created by title 11 or title 15 of article 8
of the public authorities law on or after such date.

                                 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

S. 2609--D                         62                         A. 3009--D

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

  Intentionally omitted

                                 PART N

  Intentionally omitted

                                 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
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

S. 2609--D                         63                         A. 3009--D

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 SIXTY 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:
  (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

S. 2609--D                         64                         A. 3009--D

SECTION FIVE HUNDRED TEN OF THE VEHICLE AND TRAFFIC LAW SIXTY 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 SIXTY 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 LIABILITIES OR
MAKE PAYMENT ARRANGEMENTS SATISFACTORY TO THE COMMISSIONER, THE  DEPART-
MENT 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.
  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

S. 2609--D                         65                         A. 3009--D

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-
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-

S. 2609--D                         66                         A. 3009--D

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.  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

S. 2609--D                         67                         A. 3009--D

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
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.    THE  INCOME
EXECUTION SHALL SPECIFY THE NAME AND ADDRESS OF THE PERSON FROM WHOM THE
TAXPAYER  IS  RECEIVING  OR WILL RECEIVE MONEY; THE AMOUNT OF MONEY, THE
FREQUENCY OF ITS PAYMENT AND  THE  AMOUNT  OF  THE  INSTALLMENTS  TO  BE
COLLECTED THEREFROM; AND SHALL CONTAIN A NOTICE TO THE TAXPAYER THAT THE
TAXPAYER  SHALL  COMMENCE  PAYMENT  OF THE INSTALLMENTS SPECIFIED IN THE
NOTICE WITHIN A SPECIFIED PERIOD OF TIME THAT IS NO LESS THAN TWENTY-ONE
DAYS AFTER THE NOTICE IS MAILED TO THE  TAXPAYER,  AND  THAT,  UPON  THE
TAXPAYER'S  DEFAULT,  THE  EXECUTION WILL BE SERVED UPON THE PERSON FROM
WHOM THE TAXPAYER IS RECEIVING OR  WILL  RECEIVE  MONEY.    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.
  3. THE COMMISSIONER SHALL PERIODICALLY, BUT NO  LESS  FREQUENTLY  THAN
QUARTERLY,  ELECTRONICALLY  FILE  WITH THE DEPARTMENT OF STATE A LIST OF
THE NAMES OF THE TAXPAYERS WHO HAVE BEEN SERVED WITH  INCOME  EXECUTIONS
UNDER THE AUTHORITY OF THIS SECTION DURING THAT PERIOD. THE COMMISSIONER
SHALL  ALSO  INCLUDE  IN  THIS  LIST THE NAMES OF TAXPAYERS WHOSE INCOME
EXECUTIONS ARE CANCELLED OR DISCHARGED DURING THAT PERIOD.  THE  DEPART-
MENT OF STATE SHALL UPON RECEIPT POST SUCH A LIST TO THEIR WEBSITE.
  S  2.  This  act shall take effect immediately and shall expire and be
deemed repealed on and after April 1, 2015.

                                 PART R

  Intentionally omitted

S. 2609--D                         68                         A. 3009--D

                                 PART S

  Intentionally omitted

                                 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.
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

S. 2609--D                         69                         A. 3009--D

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]   FOURTEEN;
provided,  however, that any party to such agreement may elect to termi-
nate such agreement upon conveying written notice to all  other  parties
of  such  agreement 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] FOURTEEN; 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] FOURTEEN, 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
determined by comparing the total commissions available after July twen-
ty-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.  The  opening  paragraph of subdivision 1 of section 1014 of the
racing, pari-mutuel wagering and breeding law, as amended by  section  3
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 conducting a race meet-
ing in Saratoga county at Saratoga  thoroughbred  racetrack  until  June
thirtieth, two thousand [thirteen] FOURTEEN and on any day regardless of
whether  or not a franchised corporation is conducting a race meeting in
Saratoga county at Saratoga thoroughbred racetrack after June thirtieth,
two thousand [thirteen] FOURTEEN.   On any day  on  which  a  franchised
corporation has not scheduled a racing program but a thoroughbred racing
corporation  located  within  the state is conducting racing, every off-
track betting corporation branch office and every simulcasting  facility
licensed  in  accordance  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

S. 2609--D                         70                         A. 3009--D

wagers  and  display  the live simulcast signal from thoroughbred tracks
located in another state or foreign country  subject  to  the  following
provisions:
  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 July first, nineteen hundred ninety-four through June
thirtieth, two thousand [thirteen] FOURTEEN.  This section shall  super-
sede 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] FOURTEEN.   Every off-track betting
corporation branch office and every simulcasting  facility  licensed  in
accordance  with  section  one  thousand  seven that have entered into a
written agreement with such facility's representative horsemen's  organ-
ization  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
July twenty-fifth, two thousand one through September eighth, two  thou-
sand  [twelve]  THIRTEEN,  when a franchised corporation is conducting 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

S. 2609--D                         71                         A. 3009--D

repealed  on  July  1,  [2013]  2014;  provided,  however,  that nothing
contained herein shall be deemed to affect the  application,  qualifica-
tion,  expiration,  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 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 breed-
ing law, as added by section thirty-eight of this act, shall expire  and
be  deemed repealed on July 1, [2013] 2014; 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

S. 2609--D                         72                         A. 3009--D

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
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  April  first,  two  thousand  one
through  December  thirty-first,  two thousand [thirteen] FOURTEEN, 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 April
first, two thousand one  through  December  thirty-first,  two  thousand
[thirteen]  FOURTEEN,  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, as amended by section 10 of part O of chapter 59
of the laws of 2012, is amended to read as follows:
  5. The provisions of this section shall expire and be  of  no  further
force and effect after June thirtieth, two thousand [thirteen] FOURTEEN.
  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

S. 2609--D                         73                         A. 3009--D

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
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:

S. 2609--D                         74                         A. 3009--D

  (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
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

S. 2609--D                         75                         A. 3009--D

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
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.

S. 2609--D                         76                         A. 3009--D

  (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.
  [(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,   AS   DEFINED  IN  SUBDIVISION
TWENTY-THREE OF SECTION TWO HUNDRED EIGHTY-TWO OF  THIS  CHAPTER,  to  a
person  registered under article twelve-A of this chapter as a distribu-
tor 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

S. 2609--D                         77                         A. 3009--D

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[. "Qualified biodiesel" means  such  term  as  defined  in
subdivision twenty-three of section two hundred eighty-two of this chap-
ter];  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 ARTI-
CLE  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 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, AS DEFINED  IN  SUBDIVI-
SION TWENTY-THREE OF SECTION TWO HUNDRED EIGHTY-TWO OF THIS CHAPTER to a
person  registered under article twelve-A of this chapter as a distribu-
tor 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[. "Qualified biodiesel" means  such  term  as  defined  in
subdivision twenty-three of section two hundred eighty-two of this chap-
ter];  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 ARTI-
CLE  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

S. 2609--D                         78                         A. 3009--D

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,
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. 2609--D                         79                         A. 3009--D

  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.

                                 PART Y

  Section  1. Subsection (c) of section 612 of the tax law is amended by
adding a new paragraph 39 to read as follows:
  (39) IN THE CASE OF A TAXPAYER WHO IS A SMALL BUSINESS WHO  HAS  BUSI-
NESS  INCOME  AND/OR  FARM  INCOME  AS DEFINED IN THE LAWS OF THE UNITED
STATES, AN AMOUNT EQUAL TO THREE PERCENT OF THE  NET  ITEMS  OF  INCOME,
GAIN,  LOSS AND DEDUCTION ATTRIBUTABLE TO SUCH BUSINESS OR FARM ENTERING
INTO FEDERAL ADJUSTED GROSS INCOME, BUT NOT LESS THAN ZERO, FOR  TAXABLE
YEARS  BEGINNING  AFTER  TWO THOUSAND THIRTEEN, AN AMOUNT EQUAL TO THREE
AND THREE-QUARTERS PERCENT OF THE NET ITEMS OF INCOME,  GAIN,  LOSS  AND
DEDUCTION  ATTRIBUTABLE  TO  SUCH BUSINESS OR FARM ENTERING INTO FEDERAL
ADJUSTED GROSS INCOME, BUT NOT LESS THAN ZERO, FOR TAXABLE YEARS  BEGIN-
NING AFTER TWO THOUSAND FOURTEEN, AND AN AMOUNT EQUAL TO FIVE PERCENT OF
THE  NET  ITEMS OF INCOME, GAIN, LOSS AND DEDUCTION ATTRIBUTABLE TO SUCH
BUSINESS OR FARM ENTERING INTO FEDERAL ADJUSTED GROSS  INCOME,  BUT  NOT
LESS  THAN ZERO, FOR TAXABLE YEARS BEGINNING AFTER TWO THOUSAND FIFTEEN.
FOR THE PURPOSES OF THIS PARAGRAPH, THE TERM SMALL BUSINESS SHALL MEAN A
SOLE PROPRIETOR OR A FARM BUSINESS  WHO  EMPLOYS  ONE  OR  MORE  PERSONS
DURING  THE  TAXABLE  YEAR  AND  WHO HAS NET BUSINESS INCOME OR NET FARM
INCOME OF LESS THAN TWO HUNDRED FIFTY THOUSAND DOLLARS.
  S 2. Subdivision (c) of section 11-1712 of the administrative code  of
the  city  of  New York is amended by adding new paragraph 35 to read as
follows:
  (35) IN THE CASE OF A TAXPAYER WHO IS A SMALL BUSINESS WHO  HAS  BUSI-
NESS  INCOME  AND/OR  FARM  INCOME  AS DEFINED IN THE LAWS OF THE UNITED
STATES, AN AMOUNT EQUAL TO THREE PERCENT OF THE  NET  ITEMS  OF  INCOME,
GAIN,  LOSS AND DEDUCTION ATTRIBUTABLE TO SUCH BUSINESS OR FARM ENTERING
INTO FEDERAL ADJUSTED GROSS INCOME, BUT NOT LESS THAN ZERO, FOR  TAXABLE
YEARS  BEGINNING  AFTER  TWO THOUSAND THIRTEEN, AN AMOUNT EQUAL TO THREE
AND THREE-QUARTERS PERCENT OF THE NET ITEMS OF INCOME,  GAIN,  LOSS  AND
DEDUCTION  ATTRIBUTABLE  TO  SUCH BUSINESS OR FARM ENTERING INTO FEDERAL
ADJUSTED GROSS INCOME, BUT NOT LESS THAN ZERO, FOR TAXABLE YEARS  BEGIN-
NING AFTER TWO THOUSAND FOURTEEN, AND AN AMOUNT EQUAL TO FIVE PERCENT OF
THE  NET  ITEMS OF INCOME, GAIN, LOSS AND DEDUCTION ATTRIBUTABLE TO SUCH
BUSINESS OR FARM ENTERING INTO FEDERAL ADJUSTED GROSS  INCOME,  BUT  NOT
LESS  THAN ZERO, FOR TAXABLE YEARS BEGINNING AFTER TWO THOUSAND FIFTEEN.
FOR THE PURPOSES OF THIS PARAGRAPH, THE TERM SMALL BUSINESS SHALL MEAN A
SOLE PROPRIETOR OR A FARM BUSINESS  WHO  EMPLOYS  ONE  OR  MORE  PERSONS
DURING  THE  TAXABLE  YEAR  AND  WHO HAS NET BUSINESS INCOME OR NET FARM
INCOME OF LESS THAN TWO HUNDRED FIFTY THOUSAND DOLLARS.
  S 3. This act shall take effect immediately.

                                 PART Z

  Section 1. Paragraph (a) of subdivision 1 of section 210  of  the  tax
law is amended by adding a new subparagraph (vii) to read as follows:
  (VII)  FOR  A  QUALIFIED NEW YORK MANUFACTURER, AS DEFINED IN SUBPARA-
GRAPH (VI) OF THIS PARAGRAPH, THE RATE AT WHICH THE TAX IS  COMPUTED  IN
EFFECT  FOR TAXABLE YEARS BEGINNING ON OR AFTER JANUARY FIRST, TWO THOU-
SAND THIRTEEN AND BEFORE JANUARY FIRST, TWO THOUSAND FOURTEEN FOR QUALI-
FIED NEW YORK MANUFACTURERS SHALL BE  REDUCED  BY  NINE  AND  TWO-TENTHS
PERCENT  FOR  TAXABLE  YEARS  COMMENCING  ON OR AFTER JANUARY FIRST, TWO

S. 2609--D                         80                         A. 3009--D

THOUSAND FOURTEEN AND BEFORE JANUARY FIRST, TWO THOUSAND FIFTEEN, TWELVE
AND THREE-TENTHS PERCENT FOR TAXABLE YEARS COMMENCING ON OR AFTER  JANU-
ARY  FIRST,  TWO THOUSAND FIFTEEN AND BEFORE JANUARY FIRST, TWO THOUSAND
SIXTEEN, FIFTEEN AND FOUR-TENTHS PERCENT FOR TAXABLE YEARS COMMENCING ON
OR  AFTER  JANUARY FIRST, TWO THOUSAND SIXTEEN AND BEFORE JANUARY FIRST,
TWO THOUSAND EIGHTEEN, AND TWENTY-FIVE PERCENT FOR TAXABLE YEARS  BEGIN-
NING ON OR AFTER JANUARY FIRST, TWO THOUSAND EIGHTEEN.
  S  2.  Paragraph (b) of subdivision 1 of section 210 of the tax law is
amended by adding a new subparagraph 3 to read as follows:
  (3) FOR A QUALIFIED NEW YORK MANUFACTURER, AS DEFINED IN  SUBPARAGRAPH
TWO  OF  THIS PARAGRAPH, THE RATE AT WHICH THE TAX IS COMPUTED IN EFFECT
FOR TAXABLE YEARS BEGINNING ON OR  AFTER  JANUARY  FIRST,  TWO  THOUSAND
THIRTEEN  AND  BEFORE  JANUARY  FIRST,  TWO  THOUSAND  FOURTEEN SHALL BE
REDUCED BY NINE AND TWO-TENTHS PERCENT FOR TAXABLE YEARS  COMMENCING  ON
OR  AFTER JANUARY FIRST, TWO THOUSAND FOURTEEN AND BEFORE JANUARY FIRST,
TWO THOUSAND FIFTEEN, TWELVE AND THREE-TENTHS PERCENT FOR TAXABLE  YEARS
COMMENCING  ON  OR  AFTER JANUARY FIRST, TWO THOUSAND FIFTEEN AND BEFORE
JANUARY FIRST, TWO THOUSAND SIXTEEN, FIFTEEN AND FOUR-TENTHS PERCENT FOR
TAXABLE YEARS COMMENCING ON OR AFTER JANUARY FIRST, TWO THOUSAND SIXTEEN
AND BEFORE JANUARY FIRST, TWO THOUSAND EIGHTEEN, AND TWENTY-FIVE PERCENT
FOR TAXABLE YEARS BEGINNING ON OR  AFTER  JANUARY  FIRST,  TWO  THOUSAND
EIGHTEEN.
  S  3.  Paragraph (c) of subdivision 1 of section 210 of the tax law is
amended by adding a new subparagraph (iii) to read as follows:
  (III) FOR A QUALIFIED NEW YORK MANUFACTURER, AS  DEFINED  IN  SUBPARA-
GRAPH  (VI)  OF PARAGRAPH (A) OF THIS SUBDIVISION, THE RATE AT WHICH THE
TAX IS COMPUTED IN EFFECT FOR TAXABLE YEARS BEGINNING ON OR AFTER  JANU-
ARY  FIRST, TWO THOUSAND THIRTEEN AND BEFORE JANUARY FIRST, TWO THOUSAND
FOURTEEN FOR QUALIFIED NEW YORK MANUFACTURERS SHALL BE REDUCED  BY  NINE
AND  TWO-TENTHS PERCENT FOR TAXABLE YEARS COMMENCING ON OR AFTER JANUARY
FIRST, TWO THOUSAND FOURTEEN AND  BEFORE  JANUARY  FIRST,  TWO  THOUSAND
FIFTEEN, TWELVE AND THREE-TENTHS PERCENT FOR TAXABLE YEARS COMMENCING ON
OR  AFTER  JANUARY FIRST, TWO THOUSAND FIFTEEN AND BEFORE JANUARY FIRST,
TWO THOUSAND SIXTEEN, FIFTEEN AND FOUR-TENTHS PERCENT FOR TAXABLE  YEARS
COMMENCING  ON  OR  AFTER JANUARY FIRST, TWO THOUSAND SIXTEEN AND BEFORE
JANUARY FIRST, TWO THOUSAND EIGHTEEN, AND TWENTY-FIVE PERCENT FOR  TAXA-
BLE YEARS BEGINNING ON OR AFTER JANUARY FIRST, TWO THOUSAND EIGHTEEN.
  S  4.  Paragraph (d) of subdivision 1 of section 210 of the tax law is
amended by adding a new subparagraph 6 to read as follows:
  (6) FOR A QUALIFIED NEW YORK MANUFACTURER, AS DEFINED IN  SUBPARAGRAPH
(VI)  OF  PARAGRAPH  (A)  OF THIS SUBDIVISION, THE AMOUNTS PRESCRIBED IN
SUBPARAGRAPHS ONE AND FOUR OF THIS PARAGRAPH IN EFFECT FOR TAXABLE YEARS
BEGINNING ON OR AFTER JANUARY FIRST, TWO THOUSAND  THIRTEEN  AND  BEFORE
JANUARY  FIRST, TWO THOUSAND FOURTEEN FOR QUALIFIED NEW YORK MANUFACTUR-
ERS SHALL BE REDUCED BY NINE AND TWO-TENTHS PERCENT  FOR  TAXABLE  YEARS
COMMENCING  ON  OR AFTER JANUARY FIRST, TWO THOUSAND FOURTEEN AND BEFORE
JANUARY FIRST, TWO THOUSAND FIFTEEN, TWELVE AND THREE-TENTHS PERCENT FOR
TAXABLE YEARS COMMENCING ON OR AFTER JANUARY FIRST, TWO THOUSAND FIFTEEN
AND BEFORE JANUARY FIRST, TWO THOUSAND SIXTEEN, FIFTEEN AND  FOUR-TENTHS
PERCENT  FOR  TAXABLE  YEARS  COMMENCING  ON OR AFTER JANUARY FIRST, TWO
THOUSAND SIXTEEN AND BEFORE JANUARY FIRST, TWO  THOUSAND  EIGHTEEN,  AND
TWENTY-FIVE  PERCENT  FOR  TAXABLE  YEARS  BEGINNING ON OR AFTER JANUARY
FIRST, TWO THOUSAND EIGHTEEN.
  S 5. This act shall take effect immediately.

                                 PART AA

S. 2609--D                         81                         A. 3009--D

  Section 1. Section 210 of the tax law  is  amended  by  adding  a  new
subdivision 23-a to read as follows:
  23-A.  HIRE  A  VET CREDIT. (A) ALLOWANCE OF CREDIT. FOR TAXABLE YEARS
BEGINNING ON OR AFTER JANUARY FIRST, TWO  THOUSAND  FIFTEEN  AND  BEFORE
JANUARY  FIRST,  TWO  THOUSAND  SEVENTEEN, A TAXPAYER SHALL BE ALLOWED A
CREDIT, TO BE COMPUTED AS PROVIDED IN THIS SUBDIVISION, AGAINST THE  TAX
IMPOSED BY THIS ARTICLE, FOR HIRING AND EMPLOYING, FOR NOT LESS THAN ONE
YEAR  AND  FOR  NOT  LESS  THAN THIRTY-FIVE HOURS EACH WEEK, A QUALIFIED
VETERAN WITHIN THE STATE. THE TAXPAYER MAY CLAIM THE CREDIT IN THE  YEAR
IN  WHICH  THE QUALIFIED VETERAN COMPLETES ONE YEAR OF EMPLOYMENT BY THE
TAXPAYER.  IF THE TAXPAYER CLAIMS THE CREDIT ALLOWED UNDER THIS SUBDIVI-
SION, THE TAXPAYER MAY NOT USE THE HIRING OF A QUALIFIED VETERAN THAT IS
THE BASIS FOR THIS CREDIT IN THE BASIS OF ANY OTHER CREDIT ALLOWED UNDER
THIS ARTICLE.
  (B) QUALIFIED VETERAN. A QUALIFIED VETERAN IS AN INDIVIDUAL:
  (1) WHO SERVED ON ACTIVE DUTY IN THE UNITED  STATES  ARMY,  NAVY,  AIR
FORCE,  MARINE CORPS, COAST GUARD OR THE RESERVES THEREOF, OR WHO SERVED
IN ACTIVE MILITARY SERVICE OF THE UNITED STATES AS A MEMBER OF THE  ARMY
NATIONAL  GUARD,  AIR  NATIONAL  GUARD, NEW YORK GUARD OR NEW YORK NAVAL
MILITIA; WHO WAS RELEASED FROM  ACTIVE  DUTY  BY  GENERAL  OR  HONORABLE
DISCHARGE AFTER SEPTEMBER ELEVENTH, TWO THOUSAND ONE;
  (2)  WHO  COMMENCES  EMPLOYMENT  BY THE QUALIFIED TAXPAYER ON OR AFTER
JANUARY FIRST, TWO THOUSAND FOURTEEN,  AND  BEFORE  JANUARY  FIRST,  TWO
THOUSAND SIXTEEN; AND
  (3)  WHO CERTIFIES BY SIGNED AFFIDAVIT, UNDER PENALTY OF PERJURY, THAT
HE OR SHE HAS NOT BEEN EMPLOYED FOR THIRTY-FIVE OR MORE HOURS DURING ANY
WEEK IN THE ONE HUNDRED EIGHTY DAY PERIOD IMMEDIATELY PRIOR  TO  HIS  OR
HER EMPLOYMENT BY THE TAXPAYER.
  (C)  EMPLOYER PROHIBITION. AN EMPLOYER SHALL NOT DISCHARGE AN EMPLOYEE
AND HIRE A QUALIFYING VETERAN SOLELY FOR THE PURPOSE OF  QUALIFYING  FOR
THIS CREDIT.
  (D) AMOUNT OF CREDIT. THE AMOUNT OF THE CREDIT SHALL BE TEN PERCENT OF
THE  TOTAL  AMOUNT  OF  WAGES  PAID  TO THE QUALIFIED VETERAN DURING THE
VETERAN'S FIRST FULL YEAR OF EMPLOYMENT. PROVIDED, HOWEVER, THAT, IF THE
QUALIFIED VETERAN IS A DISABLED VETERAN, AS DEFINED IN PARAGRAPH (B)  OF
SUBDIVISION  ONE  OF  SECTION  EIGHTY-FIVE OF THE CIVIL SERVICE LAW, THE
AMOUNT OF THE CREDIT SHALL BE FIFTEEN PERCENT OF  THE  TOTAL  AMOUNT  OF
WAGES PAID TO THE QUALIFIED VETERAN DURING THE VETERAN'S FIRST FULL YEAR
OF EMPLOYMENT. THE CREDIT ALLOWED PURSUANT TO THIS SUBDIVISION SHALL NOT
EXCEED  IN  ANY  TAXABLE  YEAR,  FIVE THOUSAND DOLLARS FOR ANY QUALIFIED
VETERAN AND FIFTEEN THOUSAND DOLLARS FOR ANY QUALIFIED VETERAN WHO IS  A
DISABLED VETERAN.
  (E) CARRYOVER. THE CREDIT ALLOWED UNDER THIS SUBDIVISION FOR ANY TAXA-
BLE  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.
HOWEVER,  IF  THE  AMOUNT OF CREDIT 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
THREE YEARS AND MAY BE DEDUCTED FROM THE TAXPAYER'S TAX FOR SUCH YEAR OR
YEARS.
  S  2. 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) HIRE A VET CREDIT           AMOUNT OF CREDIT UNDER SUBDIVISION
UNDER SUBSECTION (A-2)             TWENTY-THREE-A OF SECTION TWO
                                   HUNDRED TEN OR SUBSECTION (E-1)

S. 2609--D                         82                         A. 3009--D

                                   OF SECTION FOURTEEN HUNDRED
                                   FIFTY-SIX
  S  3. Section 606 of the tax law is amended by adding a new subsection
(a-2) to read as follows:
  (A-2) HIRE A VET CREDIT. (1) ALLOWANCE OF CREDIT.  FOR  TAXABLE  YEARS
BEGINNING  ON  OR  AFTER  JANUARY FIRST, TWO THOUSAND FIFTEEN AND BEFORE
JANUARY FIRST, TWO THOUSAND SEVENTEEN, A TAXPAYER  SHALL  BE  ALLOWED  A
CREDIT,  TO  BE COMPUTED AS PROVIDED IN THIS SUBSECTION, AGAINST THE TAX
IMPOSED BY THIS ARTICLE, FOR HIRING AND EMPLOYING, FOR NOT LESS THAN ONE
YEAR AND FOR NOT LESS THAN THIRTY-FIVE  HOURS  EACH  WEEK,  A  QUALIFIED
VETERAN  WITHIN THE STATE. THE TAXPAYER MAY CLAIM THE CREDIT IN THE YEAR
IN WHICH THE QUALIFIED VETERAN COMPLETES ONE YEAR OF EMPLOYMENT  BY  THE
TAXPAYER.    IF  THE  TAXPAYER  CLAIMS  THE  CREDIT  ALLOWED  UNDER THIS
SUBSECTION, THE TAXPAYER MAY NOT USE THE HIRING OF A  QUALIFIED  VETERAN
THAT  IS  THE  BASIS  FOR  THIS  CREDIT IN THE BASIS OF ANY OTHER CREDIT
ALLOWED UNDER THIS ARTICLE.
  (2) QUALIFIED VETERAN. A QUALIFIED VETERAN IS AN INDIVIDUAL:
  (A) WHO SERVED ON ACTIVE DUTY IN THE UNITED  STATES  ARMY,  NAVY,  AIR
FORCE,  MARINE CORPS, COAST GUARD OR THE RESERVES THEREOF, OR WHO SERVED
IN ACTIVE MILITARY SERVICE OF THE UNITED STATES AS A MEMBER OF THE  ARMY
NATIONAL  GUARD,  AIR  NATIONAL  GUARD, NEW YORK GUARD OR NEW YORK NAVAL
MILITIA; WHO WAS RELEASED FROM  ACTIVE  DUTY  BY  GENERAL  OR  HONORABLE
DISCHARGE AFTER SEPTEMBER ELEVENTH, TWO THOUSAND ONE;
  (B)  WHO  COMMENCES  EMPLOYMENT  BY THE QUALIFIED TAXPAYER ON OR AFTER
JANUARY FIRST, TWO THOUSAND FOURTEEN,  AND  BEFORE  JANUARY  FIRST,  TWO
THOUSAND SIXTEEN; AND
  (C)  WHO CERTIFIES BY SIGNED AFFIDAVIT, UNDER PENALTY OF PERJURY, THAT
HE OR SHE HAS NOT BEEN EMPLOYED FOR THIRTY-FIVE OR MORE HOURS DURING ANY
WEEK IN THE ONE HUNDRED EIGHTY DAY PERIOD IMMEDIATELY PRIOR  TO  HIS  OR
HER EMPLOYMENT BY THE TAXPAYER.
  (3)  EMPLOYER PROHIBITION. AN EMPLOYER SHALL NOT DISCHARGE AN EMPLOYEE
AND HIRE A QUALIFYING VETERAN SOLELY FOR THE PURPOSE OF  QUALIFYING  FOR
THIS CREDIT.
  (4) AMOUNT OF CREDIT. THE AMOUNT OF THE CREDIT SHALL BE TEN PERCENT OF
THE TOTAL AMOUNT OF WAGES PAID TO HE QUALIFIED VETERAN DURING THE VETER-
AN'S  FIRST  FULL  YEAR  OF  EMPLOYMENT. PROVIDED, HOWEVER, THAT, IF THE
QUALIFIED VETERAN IS A DISABLED VETERAN, AS DEFINED IN PARAGRAPH (B)  OF
SUBDIVISION  ONE  OF  SECTION  EIGHTY-FIVE OF THE CIVIL SERVICE LAW, THE
AMOUNT OF THE CREDIT SHALL BE FIFTEEN PERCENT OF  THE  TOTAL  AMOUNT  OF
WAGES PAID TO THE QUALIFIED VETERAN DURING THE VETERAN'S FIRST FULL YEAR
OF  EMPLOYMENT. THE CREDIT ALLOWED PURSUANT TO THIS SUBSECTION SHALL NOT
EXCEED IN ANY TAXABLE YEAR, FIVE  THOUSAND  DOLLARS  FOR  ANY  QUALIFIED
VETERAN  AND FIFTEEN THOUSAND DOLLARS FOR ANY QUALIFIED VETERAN WHO IS A
DISABLED VETERAN.
  (5) CARRYOVER. IF THE AMOUNT OF CREDIT ALLOWABLE UNDER THIS SUBSECTION
FOR ANY TAXABLE YEAR EXCEEDS THE  TAXPAYER'S  TAX  FOR  SUCH  YEAR,  ANY
AMOUNT OF CREDIT NOT DEDUCTIBLE IN SUCH TAXABLE YEAR MAY BE CARRIED OVER
TO THE FOLLOWING THREE YEARS AND MAY BE DEDUCTED FROM THE TAXPAYER'S TAX
FOR SUCH YEAR OR YEARS.
  S 4. Section 1456 of the tax law is amended by adding a new subsection
(e-1) to read as follows:
  (E-1)  HIRE  A  VET CREDIT. (1) ALLOWANCE OF CREDIT. FOR TAXABLE YEARS
BEGINNING ON OR AFTER JANUARY FIRST, TWO  THOUSAND  FIFTEEN  AND  BEFORE
JANUARY  FIRST,  TWO  THOUSAND  SEVENTEEN, A TAXPAYER SHALL BE ALLOWED A
CREDIT, TO BE COMPUTED AS PROVIDED IN THIS SUBSECTION, AGAINST  THE  TAX
IMPOSED BY THIS ARTICLE, FOR HIRING AND EMPLOYING, FOR NOT LESS THAN ONE

S. 2609--D                         83                         A. 3009--D

YEAR  AND  FOR  NOT  LESS  THAN THIRTY-FIVE HOURS EACH WEEK, A QUALIFIED
VETERAN WITHIN THE STATE. THE TAXPAYER MAY CLAIM THE CREDIT IN THE  YEAR
IN  WHICH  THE QUALIFIED VETERAN COMPLETES ONE YEAR OF EMPLOYMENT BY THE
TAXPAYER.    IF  THE  TAXPAYER  CLAIMS  THE  CREDIT  ALLOWED  UNDER THIS
SUBSECTION, THE TAXPAYER MAY NOT USE THE HIRING OF A  QUALIFIED  VETERAN
THAT  IS  THE  BASIS  FOR  THIS  CREDIT IN THE BASIS OF ANY OTHER CREDIT
ALLOWED IN THIS ARTICLE.
  (2) QUALIFIED VETERAN. A QUALIFIED VETERAN IS AN INDIVIDUAL:
  (A) WHO SERVED ON ACTIVE DUTY IN THE UNITED  STATES  ARMY,  NAVY,  AIR
FORCE,  MARINE CORPS, COAST GUARD OR THE RESERVES THEREOF, OR WHO SERVED
IN ACTIVE MILITARY SERVICE OF THE UNITED STATES AS A MEMBER OF THE  ARMY
NATIONAL  GUARD,  AIR  NATIONAL  GUARD, NEW YORK GUARD OR NEW YORK NAVAL
MILITIA; WHO WAS RELEASED FROM  ACTIVE  DUTY  BY  GENERAL  OR  HONORABLE
DISCHARGE AFTER SEPTEMBER ELEVENTH, TWO THOUSAND ONE;
  (B)  WHO  COMMENCES  EMPLOYMENT  BY THE QUALIFIED TAXPAYER ON OR AFTER
JANUARY FIRST, TWO THOUSAND FOURTEEN,  AND  BEFORE  JANUARY  FIRST,  TWO
THOUSAND SIXTEEN; AND
  (C)  WHO CERTIFIES BY SIGNED AFFIDAVIT, UNDER PENALTY OF PERJURY, THAT
HE OR SHE HAS NOT BEEN EMPLOYED FOR THIRTY-FIVE OR MORE HOURS DURING ANY
WEEK IN THE ONE HUNDRED EIGHTY DAY PERIOD IMMEDIATELY PRIOR  TO  HIS  OR
HER EMPLOYMENT BY THE TAXPAYER.
  (3)  EMPLOYER PROHIBITION. AN EMPLOYER SHALL NOT DISCHARGE AN EMPLOYEE
AND HIRE A QUALIFYING VETERAN SOLELY FOR THE PURPOSE OF  QUALIFYING  FOR
THIS CREDIT.
  (4) AMOUNT OF CREDIT. THE AMOUNT OF THE CREDIT SHALL BE TEN PERCENT OF
THE  TOTAL  AMOUNT  OF  WAGES  PAID  TO THE QUALIFIED VETERAN DURING THE
VETERAN'S FIRST FULL YEAR OF EMPLOYMENT. PROVIDED, HOWEVER, THAT, IF THE
QUALIFIED VETERAN IS A DISABLED VETERAN, AS DEFINED IN PARAGRAPH (B)  OF
SUBDIVISION  ONE  OF  SECTION  EIGHTY-FIVE OF THE CIVIL SERVICE LAW, THE
AMOUNT OF THE CREDIT SHALL BE FIFTEEN PERCENT OF  THE  TOTAL  AMOUNT  OF
WAGES PAID TO THE QUALIFIED VETERAN DURING THE VETERAN'S FIRST FULL YEAR
OF EMPLOYMENT.  THE CREDIT ALLOWED PURSUANT TO THIS SUBSECTION SHALL NOT
EXCEED  IN  ANY  TAXABLE  YEAR,  FIVE THOUSAND DOLLARS FOR ANY QUALIFIED
VETERAN AND FIFTEEN THOUSAND DOLLARS FOR ANY QUALIFIED VETERAN WHO IS  A
DISABLED VETERAN.
  (5)  CARRYOVER. THE CREDIT ALLOWED UNDER THIS SUBSECTION FOR ANY TAXA-
BLE YEAR SHALL NOT REDUCE THE TAX DUE FOR SUCH YEAR  TO  LESS  THAN  THE
AMOUNT  PRESCRIBED IN PARAGRAPH THREE OF SUBSECTION (B) OF SECTION FOUR-
TEEN HUNDRED FIFTY-FIVE OF THIS ARTICLE. HOWEVER, IF THE AMOUNT OF CRED-
IT ALLOWABLE UNDER THIS SUBSECTION 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 THREE YEARS AND MAY BE DEDUCTED
FROM THE TAXPAYER'S TAX FOR SUCH YEAR OR YEARS.
  S 5. Section 1511 of the tax law is amended by adding a  new  subdivi-
sion (g-1) to read as follows:
  (G-1)  HIRE  A  VET CREDIT. (1) ALLOWANCE OF CREDIT. FOR TAXABLE YEARS
BEGINNING ON OR AFTER JANUARY FIRST, TWO  THOUSAND  FIFTEEN  AND  BEFORE
JANUARY  FIRST,  TWO  THOUSAND  SEVENTEEN, A TAXPAYER SHALL BE ALLOWED A
CREDIT, TO BE COMPUTED AS PROVIDED IN THIS SUBDIVISION, AGAINST THE  TAX
IMPOSED BY THIS ARTICLE, FOR HIRING AND EMPLOYING, FOR NOT LESS THAN ONE
YEAR  AND  FOR  NOT  LESS  THAN THIRTY-FIVE HOURS EACH WEEK, A QUALIFIED
VETERAN WITHIN THE STATE. THE TAXPAYER MAY CLAIM THE CREDIT IN THE  YEAR
IN  WHICH  THE QUALIFIED VETERAN COMPLETES ONE YEAR OF EMPLOYMENT BY THE
TAXPAYER.  IF THE TAXPAYER CLAIMS THE CREDIT ALLOWED UNDER THIS SUBDIVI-
SION, THE TAXPAYER MAY NOT USE THE HIRING OF A QUALIFIED VETERAN THAT IS

S. 2609--D                         84                         A. 3009--D

THE BASIS FOR THIS CREDIT IN THE BASIS OF ANY OTHER CREDIT ALLOWED UNDER
THIS ARTICLE.
  (2) QUALIFIED VETERAN. A QUALIFIED VETERAN IS AN INDIVIDUAL:
  (A)  WHO  SERVED  ON  ACTIVE DUTY IN THE UNITED STATES ARMY, NAVY, AIR
FORCE, MARINE CORPS, COAST GUARD OR THE RESERVES THEREOF, OR WHO  SERVED
IN  ACTIVE MILITARY SERVICE OF THE UNITED STATES AS A MEMBER OF THE ARMY
NATIONAL GUARD, AIR NATIONAL GUARD, NEW YORK GUARD  OR  NEW  YORK  NAVAL
MILITIA;  WHO  WAS  RELEASED  FROM  ACTIVE  DUTY BY GENERAL OR HONORABLE
DISCHARGE AFTER SEPTEMBER ELEVENTH, TWO THOUSAND ONE;
  (B) WHO COMMENCES EMPLOYMENT BY THE QUALIFIED  TAXPAYER  ON  OR  AFTER
JANUARY  FIRST,  TWO  THOUSAND  FOURTEEN,  AND BEFORE JANUARY FIRST, TWO
THOUSAND SIXTEEN; AND
  (C) WHO CERTIFIES BY SIGNED AFFIDAVIT, UNDER PENALTY OF PERJURY,  THAT
HE OR SHE HAS NOT BEEN EMPLOYED FOR THIRTY-FIVE OR MORE HOURS DURING ANY
WEEK  IN  THE  ONE HUNDRED EIGHTY DAY PERIOD IMMEDIATELY PRIOR TO HIS OR
HER EMPLOYMENT BY THE TAXPAYER.
  (3) EMPLOYER PROHIBITION. AN EMPLOYER SHALL NOT DISCHARGE AN  EMPLOYEE
AND  HIRE  A QUALIFYING VETERAN SOLELY FOR THE PURPOSE OF QUALIFYING FOR
THIS CREDIT.
  (4) AMOUNT OF CREDIT. THE AMOUNT OF THE CREDIT SHALL BE TEN PERCENT OF
THE TOTAL AMOUNT OF WAGES PAID  TO  THE  QUALIFIED  VETERAN  DURING  THE
VETERAN'S FIRST FULL YEAR OF EMPLOYMENT. PROVIDED, HOWEVER, THAT, IF THE
QUALIFIED  VETERAN IS A DISABLED VETERAN, AS DEFINED IN PARAGRAPH (B) OF
SUBDIVISION ONE OF SECTION EIGHTY-FIVE OF THE  CIVIL  SERVICE  LAW,  THE
AMOUNT  OF  THE  CREDIT  SHALL BE FIFTEEN PERCENT OF THE TOTAL AMOUNT OF
WAGES PAID TO THE QUALIFIED VETERAN DURING THE VETERAN'S FIRST FULL YEAR
OF EMPLOYMENT.  THE CREDIT ALLOWED PURSUANT TO  THIS  SUBDIVISION  SHALL
NOT  EXCEED IN ANY TAXABLE YEAR, FIVE THOUSAND DOLLARS FOR ANY QUALIFIED
VETERAN AND FIFTEEN THOUSAND DOLLARS FOR ANY QUALIFIED VETERAN WHO IS  A
DISABLED VETERAN.
  (5) CARRYOVER. THE CREDIT ALLOWED UNDER THIS SUBDIVISION FOR ANY TAXA-
BLE  YEAR  SHALL  NOT  REDUCE THE TAX DUE FOR SUCH YEAR TO LESS THAN THE
AMOUNT PRESCRIBED IN  PARAGRAPH  FOUR  OF  SUBDIVISION  (A)  OF  SECTION
FIFTEEN  HUNDRED  TWO  OF  THIS ARTICLE OR THE MINIMUM TAX PRESCRIBED IN
SECTION FIFTEEN HUNDRED TWO-A OF THIS ARTICLE, WHICHEVER IS  APPLICABLE.
HOWEVER,  IF  THE  AMOUNT OF CREDIT 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
THREE YEARS AND MAY BE DEDUCTED FROM THE TAXPAYER'S TAX FOR SUCH YEAR OR
YEARS.
  S 6. This act shall take effect immediately.

                                 PART BB

  Section  1. Paragraphs (a) and (b) of subdivision 6 of section 18-a of
the public service law, as added by section 4 of part NN of  chapter  59
of the laws of 2009, are amended to read as follows:
  (a)  Notwithstanding any provision of law to the contrary, and subject
to the exceptions provided for in paragraph (b) of this subdivision, for
the state fiscal year beginning on April first, two  thousand  nine  and
[four]  EIGHT  state fiscal years thereafter, a temporary annual assess-
ment (hereinafter "temporary state energy and utility service  conserva-
tion assessment") is hereby imposed on public utility companies (includ-
ing  for  the  purposes  of  this  subdivision municipalities other than
municipalities as defined in section  eighty-nine-l  of  this  chapter),
corporations (including for purposes of this subdivision the Long Island

S. 2609--D                         85                         A. 3009--D

power  authority),  and  persons  subject to the commission's regulation
(hereinafter such public utility companies,  corporations,  and  persons
are referred to collectively as the "utility entities") to encourage the
conservation  of  energy  and  other  resources provided through utility
entities, to be assessed in the manner  provided  in  this  subdivision;
provided,  however, that such assessment shall not be imposed upon tele-
phone corporations as defined in subdivision seventeen of section two of
this article.
  (b) The  temporary  state  energy  and  utility  service  conservation
assessment shall be [equal to two] BASED UPON THE FOLLOWING percentum of
the  utility  entity's  gross operating revenues derived from intrastate
utility operations in  the  last  preceding  calendar  year,  minus  the
amount,  if any, that such utility entity is assessed pursuant to subdi-
visions one and two of this section for the corresponding  state  fiscal
year period: (1) TWO PERCENTUM FOR THE STATE FISCAL YEAR BEGINNING APRIL
FIRST,  TWO  THOUSAND THIRTEEN AND THE STATE FISCAL YEAR BEGINNING APRIL
FIRST, TWO THOUSAND FOURTEEN; (2) ONE AND THREE-QUARTERS  PERCENTUM  FOR
THE  STATE  FISCAL YEAR BEGINNING APRIL FIRST, TWO THOUSAND FIFTEEN; AND
(3) ONE AND ONE-HALF PERCENTUM FOR THE STATE FISCAL YEAR BEGINNING APRIL
FIRST, TWO THOUSAND SIXTEEN. WITH RESPECT TO THE TEMPORARY STATE  ENERGY
AND  UTILITY  SERVICE  CONSERVATION  ASSESSMENT TO BE PAID FOR THE STATE
FISCAL YEAR BEGINNING APRIL FIRST, TWO THOUSAND SEVENTEEN  AND  NOTWITH-
STANDING  CLAUSE  (I) OF PARAGRAPH (D) OF THIS SUBDIVISION, ON OR BEFORE
MARCH TENTH, TWO THOUSAND  SEVENTEEN,  UTILITY  ENTITIES  SHALL  MAKE  A
PAYMENT EQUAL TO ONE-HALF OF THE ASSESSMENT PAID BY SUCH ENTITIES PURSU-
ANT  TO  THIS  PARAGRAPH  FOR  THE  STATE FISCAL YEAR BEGINNING ON APRIL
FIRST, TWO THOUSAND SIXTEEN. With  respect  to  the  Long  Island  power
authority,  the  temporary state energy and utility service conservation
assessment shall be [equal to one] BASED UPON THE FOLLOWING percentum of
such authority's gross operating revenues derived from intrastate utili-
ty operations in the last preceding calendar year: (1) ONE PERCENTUM FOR
THE STATE FISCAL YEAR BEGINNING APRIL FIRST, TWO THOUSAND  THIRTEEN  AND
THE  STATE FISCAL YEAR BEGINNING APRIL FIRST, TWO THOUSAND FOURTEEN; (2)
THREE-QUARTERS OF ONE PERCENTUM FOR  THE  STATE  FISCAL  YEAR  BEGINNING
APRIL  FIRST,  TWO  THOUSAND FIFTEEN; AND (3) ONE-HALF PERCENTUM FOR THE
STATE FISCAL YEAR BEGINNING APRIL  FIRST,  TWO  THOUSAND  SIXTEEN.  WITH
RESPECT  TO  THE TEMPORARY STATE ENERGY AND UTILITY SERVICE CONSERVATION
ASSESSMENT TO BE PAID FOR THE STATE FISCAL YEAR BEGINNING  APRIL  FIRST,
TWO  THOUSAND  SEVENTEEN AND NOTWITHSTANDING CLAUSE (I) OF PARAGRAPH (D)
OF THIS SUBDIVISION, ON OR BEFORE MARCH TENTH, TWO  THOUSAND  SEVENTEEN,
THE  LONG  ISLAND POWER AUTHORITY SHALL MAKE A PAYMENT EQUAL TO ONE-HALF
OF THE ASSESSMENT IT PAID FOR THE STATE FISCAL YEAR BEGINNING  ON  APRIL
FIRST,  TWO  THOUSAND  SIXTEEN.  No corporation or person subject to the
jurisdiction of the commission only with respect to safety, or the power
authority of the state of New York, shall be subject  to  the  temporary
state  energy  and  utility service conservation assessment provided for
under this subdivision. Utility entities whose gross operating  revenues
from  intrastate utility operations are five hundred thousand dollars or
less in the preceding calendar year shall not be subject to  the  tempo-
rary state energy and utility service conservation assessment. The mini-
mum  temporary  state energy and utility service conservation assessment
to be billed to any utility entity whose gross revenues from  intrastate
utility operations are in excess of five hundred thousand dollars in the
preceding calendar year shall be two hundred dollars.
  S  2. Section 6 of part NN of chapter 59 of the laws of 2009, amending
the public service law relating  to  financing  the  operations  of  the

S. 2609--D                         86                         A. 3009--D

department  of public service, the public service commission, department
support and energy management services provided by other state agencies,
increasing the utility assessment cap  and  the  minimum  threshold  for
collection  thereunder,  and  establishing  a temporary state energy and
utility service conservation assessment and providing for the collection
thereof, is amended to read as follows:
  S 6. This act shall take effect immediately; provided,  however,  that
subdivision  6  of  section  18-a of the public service law, as added by
section four of this act shall take  effect  April  1,  2009  and  shall
expire  and  be  deemed  repealed March 31, [2014] 2017; [and] provided,
[further,] that if section four of this act shall become law after April
1, 2009, it shall take effect immediately and shall be  deemed  to  have
been  in full force and effect on and after April 1, 2009; AND PROVIDED,
FURTHER, THAT THE PROVISIONS OF SUBDIVISION 6 OF  SECTION  18-A  OF  THE
PUBLIC  SERVICE  LAW  SHALL  CONTINUE  IN EFFECT WITH REGARD TO ALL SUCH
ASSESSMENTS INCURRED PRIOR TO REPEAL OF THIS SECTION.
  S 3. This act shall take effect immediately and  shall  be  deemed  to
have been in full force and effect on and after April 1, 2013; provided,
however,  that  the  amendments  to subdivision 6 of section 18-a of the
public service law made by section one of this act shall not affect  the
repeal of such subdivision and shall be deemed to be repealed therewith.

                                 PART CC

  Section  1.  Section  606  of  the  tax law is amended by adding a new
subsection (vv) to read as follows:
  (VV) FAMILY TAX RELIEF CREDIT. 1. AN INDIVIDUAL TAXPAYER WHO MEETS THE
ELIGIBILITY STANDARDS IN PARAGRAPH  TWO  OF  THIS  SUBSECTION  SHALL  BE
ALLOWED  A  CREDIT  AGAINST  THE  TAXES IMPOSED BY THIS ARTICLE OF THREE
HUNDRED FIFTY DOLLARS PER RETURN FOR TAX YEARS  TWO  THOUSAND  FOURTEEN,
TWO THOUSAND FIFTEEN, AND TWO THOUSAND SIXTEEN.
  2.  TO  BE  ELIGIBLE FOR THE CREDIT, THE TAXPAYER (OR TAXPAYERS FILING
JOINT RETURNS) ON THE PERSONAL INCOME TAX RETURN FILED FOR  THE  TAXABLE
YEAR  TWO YEARS PRIOR, MUST HAVE (A) BEEN A RESIDENT, (B) CLAIMED ONE OR
MORE DEPENDENT CHILDREN WHO WERE UNDER THE AGE OF SEVENTEEN ON THE  LAST
DAY  OF  THE  TAXABLE YEAR, (C) HAD NEW YORK ADJUSTED GROSS INCOME OF AT
LEAST FORTY THOUSAND DOLLARS BUT NO GREATER THAN THREE HUNDRED  THOUSAND
DOLLARS, AND (D) HAD A TAX LIABILITY AS DETERMINED UNDER PARAGRAPH THREE
OF THIS SUBSECTION OF GREATER THAN OR EQUAL TO ZERO.
  3.  FOR PURPOSES OF THIS SUBSECTION, TAX LIABILITY SHALL BE DETERMINED
BY APPLYING THE TAX RATE CALCULATIONS IN SECTIONS SIX  HUNDRED  ONE  AND
SIX HUNDRED ONE-A OF THIS PART TO THE TAXPAYER'S TAXABLE INCOME AND THEN
SUBTRACTING  FROM  THAT  AMOUNT ANY OTHER TAX CREDITS ALLOWED UNDER THIS
SECTION OR SECTION SIX HUNDRED TWENTY OF THIS ARTICLE.
  4. FOR EACH  YEAR  THIS  CREDIT  IS  ALLOWED,  ON  OR  BEFORE  OCTOBER
FIFTEENTH  OF SUCH YEAR, THE COMMISSIONER SHALL DETERMINE THE TAXPAYER'S
ELIGIBILITY FOR THIS CREDIT UTILIZING THE INFORMATION AVAILABLE  TO  THE
COMMISSIONER  ON THE TAXPAYER'S PERSONAL INCOME TAX RETURN FILED FOR THE
TAXABLE YEAR TWO YEARS PRIOR TO THE TAXABLE YEAR IN WHICH THE CREDIT  IS
ALLOWED. FOR THOSE TAXPAYERS WHOM THE COMMISSIONER HAS DETERMINED ELIGI-
BLE  FOR  THIS CREDIT, THE COMMISSIONER SHALL ADVANCE A PAYMENT OF THREE
HUNDRED FIFTY DOLLARS. WHEN A TAXPAYER FILES HIS OR HER RETURN  FOR  THE
TAXABLE YEAR, SUCH TAXPAYER SHALL PROPERLY RECONCILE THAT PAYMENT ON HIS
OR HER RETURN.
  5.  IF  THE  AMOUNT  OF THE CREDIT ALLOWED UNDER THIS SUBSECTION SHALL
EXCEED THE TAXPAYER'S TAX FOR THE TAXABLE  YEAR,  THE  EXCESS  SHALL  BE

S. 2609--D                         87                         A. 3009--D

TREATED  AS  AN OVERPAYMENT OF TAX TO BE CREDITED OR REFUNDED IN ACCORD-
ANCE WITH THE PROVISIONS OF SIX  HUNDRED  EIGHTY-SIX  OF  THIS  ARTICLE,
PROVIDED, HOWEVER, THAT NO INTEREST SHALL BE PAID THEREON.
  S 2. This act shall take effect immediately.

                                 PART DD

  Section  1. Subdivision (b) of section 25-a of the labor law, as added
by section 1 of part D of chapter 56 of the laws of 2011, is amended  to
read as follows:
  (b)  Definitions.  (1) The term "qualified employer" means an employer
that has been certified by the commissioner to participate  in  the  New
York  youth works tax credit program and that employs one or more quali-
fied employees.
  (2) The term "qualified employee" means an individual:
  (i) who is between the age of sixteen and twenty-four;
  (ii) who resides in a city with a population of [sixty-two] FIFTY-FIVE
thousand or more or a town with a  population  of  four  hundred  eighty
thousand or more;
  (iii)  who is low-income or at-risk, as those terms are defined by the
commissioner;
  (iv) who is unemployed prior to being hired by the qualified employer;
and
  (v) who will be working for the qualified employer in a  full-time  or
part-time position that pays wages that are equivalent to the wages paid
for similar jobs, with appropriate adjustments for experience and train-
ing,  and  for which no other employee has been terminated, or where the
employer has not otherwise reduced its workforce by  involuntary  termi-
nations  with  the  intention  of  filling the vacancy by creating a new
hire.
  S 2. Subdivisions (a) and (d) of section 25-a of the labor law, subdi-
vision (a) as added by section 1 of part D of chapter 56 of the laws  of
2011 and subdivision (d) as amended by section 1 of part T of chapter 59
of the laws of 2012, are amended to read as follows:
  (a) The commissioner is authorized to establish and administer the New
York youth works tax credit program to provide tax incentives to employ-
ers  for  employing  at  risk youth in part-time and full-time positions
[in]. THERE WILL BE FIVE DISTINCT POOLS OF TAX INCENTIVES.  PROGRAM  ONE
WILL  COVER  TAX  INCENTIVES  ALLOCATED  FOR two thousand twelve and two
thousand thirteen.  PROGRAM TWO WILL COVER TAX INCENTIVES  ALLOCATED  IN
TWO  THOUSAND  FOURTEEN TO BE USED IN TWO THOUSAND FOURTEEN AND FIFTEEN.
PROGRAM THREE WILL  COVER  TAX  INCENTIVES  ALLOCATED  IN  TWO  THOUSAND
FIFTEEN  TO  BE  USED  IN TWO THOUSAND FIFTEEN AND SIXTEEN. PROGRAM FOUR
WILL COVER TAX INCENTIVES ALLOCATED IN TWO THOUSAND SIXTEEN TO  BE  USED
IN  TWO  THOUSAND  SIXTEEN  AND SEVENTEEN.   PROGRAM FIVE WILL COVER TAX
INCENTIVES ALLOCATED IN TWO THOUSAND SEVENTEEN TO BE USED IN  TWO  THOU-
SAND  SEVENTEEN AND EIGHTEEN. The commissioner is authorized to allocate
up to twenty-five million dollars of tax credits  under  [this]  program
ONE,  SIX MILLION DOLLARS OF  TAX CREDITS UNDER PROGRAM TWO, SIX MILLION
DOLLARS OF TAX CREDITS UNDER PROGRAM THREE, AND SIX MILLION  DOLLARS  OF
TAX  CREDITS  UNDER PROGRAM FOUR, AND SIX MILLION DOLLARS OF TAX CREDITS
UNDER PROGRAM FIVE.
  (d) To participate in the New York youth works tax credit program,  an
employer must submit an application (in a form prescribed by the commis-
sioner) to the commissioner after January first, two thousand twelve but
no  later  than November thirtieth, two thousand twelve FOR PROGRAM ONE,

S. 2609--D                         88                         A. 3009--D

AFTER JANUARY FIRST, TWO THOUSAND FOURTEEN BUT NO  LATER  THAN  NOVEMBER
THIRTIETH,  TWO  THOUSAND FOURTEEN FOR PROGRAM TWO, AFTER JANUARY FIRST,
TWO THOUSAND FIFTEEN BUT NO LATER THAN NOVEMBER THIRTIETH, TWO  THOUSAND
FIFTEEN FOR PROGRAM THREE, AFTER JANUARY FIRST, TWO THOUSAND SIXTEEN BUT
NO LATER THAN NOVEMBER THIRTIETH, TWO THOUSAND SIXTEEN FOR PROGRAM FOUR,
AND AFTER JANUARY FIRST, TWO THOUSAND SEVENTEEN BUT NO LATER THAN NOVEM-
BER  THIRTIETH,  TWO  THOUSAND SEVENTEEN FOR PROGRAM FIVE. The qualified
employees must start their employment on or  after  January  first,  two
thousand  twelve  but  no later than December thirty-first, two thousand
twelve FOR PROGRAM ONE, ON OR AFTER JANUARY FIRST, TWO THOUSAND FOURTEEN
BUT NO LATER THAN  DECEMBER  THIRTY-FIRST,  TWO  THOUSAND  FOURTEEN  FOR
PROGRAM  TWO,  ON  OR  AFTER  JANUARY FIRST, TWO THOUSAND FIFTEEN BUT NO
LATER THAN DECEMBER  THIRTY-FIRST,  TWO  THOUSAND  FIFTEEN  FOR  PROGRAM
THREE, ON OR AFTER JANUARY FIRST, TWO THOUSAND SIXTEEN BUT NO LATER THAN
DECEMBER  THIRTY-FIRST, TWO THOUSAND SIXTEEN FOR PROGRAM FOUR, AND ON OR
AFTER JANUARY FIRST, TWO THOUSAND SEVENTEEN BUT NO LATER  THAN  DECEMBER
THIRTY-FIRST, TWO THOUSAND SEVENTEEN FOR PROGRAM FIVE.  The commissioner
shall  establish  guidelines  and criteria that specify requirements for
employers to participate in the program including criteria for  certify-
ing  qualified  employees.  Any regulations that the commissioner deter-
mines are necessary may be adopted on an emergency basis notwithstanding
anything to the contrary in section two hundred two of the state  admin-
istrative  procedure  act.    Such requirements may include the types of
industries that the employers are engaged in. The commissioner may  give
preference to employers that are engaged in demand occupations or indus-
tries,  or in regional growth sectors, including those identified by the
regional economic development councils, such as  clean  energy,  health-
care,  advanced manufacturing and conservation. In addition, the commis-
sioner shall give preference to  employers  who  offer  advancement  and
employee benefit packages to the qualified individuals.
  S 3. This act shall take effect immediately.

                                 PART EE

  Section  1.  The tax law is amended by adding a new section 38 to read
as follows:
  S 38. MINIMUM WAGE REIMBURSEMENT CREDIT. (A) A  TAXPAYER  THAT  IS  AN
ELIGIBLE  EMPLOYER  OR  AN  OWNER  OF AN ELIGIBLE EMPLOYER AS DEFINED IN
SUBDIVISION (B) OF THIS SECTION SHALL BE ELIGIBLE FOR A  CREDIT  AGAINST
THE  TAX  IMPOSED  UNDER ARTICLE NINE, NINE-A, TWENTY-TWO, THIRTY-TWO OR
THIRTY-THREE OF THIS ARTICLE, PURSUANT TO THE PROVISIONS  REFERENCED  IN
SUBDIVISION (E) OF THIS SECTION.
  (B)  AN  ELIGIBLE  EMPLOYER  IS  A CORPORATION (INCLUDING A NEW YORK S
CORPORATION), A SOLE PROPRIETORSHIP, A LIMITED LIABILITY  COMPANY  OR  A
PARTNERSHIP.  AN  ELIGIBLE EMPLOYEE IS AN INDIVIDUAL WHO IS (I) EMPLOYED
BY AN ELIGIBLE EMPLOYER IN NEW YORK STATE, (II) PAID AT THE MINIMUM WAGE
RATE AS DEFINED IN ARTICLE NINETEEN OF THE LABOR LAW DURING THE  TAXABLE
YEAR  BY  THE  ELIGIBLE  EMPLOYER, (III) BETWEEN THE AGES OF SIXTEEN AND
NINETEEN DURING THE PERIOD IN WHICH HE OR SHE IS PAID  AT  SUCH  MINIMUM
WAGE RATE BY THE ELIGIBLE EMPLOYER, AND (IV) A STUDENT DURING THE PERIOD
IN WHICH HE OR SHE IS PAID AT SUCH MINIMUM WAGE RATE BY THE TAXPAYER.
  (C)  FOR  TAXABLE YEARS BEGINNING ON OR AFTER JANUARY FIRST, TWO THOU-
SAND FOURTEEN AND BEFORE JANUARY FIRST, TWO THOUSAND FIFTEEN, THE AMOUNT
OF THE CREDIT ALLOWED UNDER THIS SECTION SHALL BE EQUAL TO  THE  PRODUCT
OF  THE TOTAL NUMBER OF HOURS WORKED DURING THE TAXABLE YEAR BY ELIGIBLE
EMPLOYEES FOR WHICH THEY WERE PAID AT THE MINIMUM WAGE RATE  AS  DEFINED

S. 2609--D                         89                         A. 3009--D

IN  ARTICLE NINETEEN OF THE LABOR LAW AND SEVENTY FIVE CENTS.  FOR TAXA-
BLE YEARS BEGINNING ON OR AFTER JANUARY FIRST, TWO THOUSAND FIFTEEN  AND
BEFORE  JANUARY  FIRST,  TWO  THOUSAND SIXTEEN, THE AMOUNT OF THE CREDIT
ALLOWED  UNDER  THIS  SECTION SHALL BE EQUAL TO THE PRODUCT OF THE TOTAL
NUMBER OF HOURS DURING THE TAXABLE YEAR WORKED BY ELIGIBLE EMPLOYEES FOR
WHICH THEY WERE PAID AT SUCH MINIMUM WAGE RATE AND ONE DOLLAR AND  THIR-
TY-ONE  CENTS.    FOR TAXABLE YEARS BEGINNING ON OR AFTER JANUARY FIRST,
TWO THOUSAND SIXTEEN AND BEFORE JANUARY FIRST,  TWO  THOUSAND  NINETEEN,
THE  AMOUNT  OF  THE CREDIT ALLOWED UNDER THIS SECTION SHALL BE EQUAL TO
THE PRODUCT OF THE TOTAL NUMBER OF HOURS DURING THE TAXABLE YEAR  WORKED
BY ELIGIBLE EMPLOYEES FOR WHICH THEY WERE PAID AT SUCH MINIMUM WAGE RATE
AND ONE DOLLAR AND THIRTY-FIVE CENTS.  PROVIDED, HOWEVER, IF THE FEDERAL
MINIMUM  WAGE  ESTABLISHED  BY FEDERAL LAW PURSUANT TO 29 U.S.C. SECTION
206 OR ITS SUCCESSORS IS INCREASED  ABOVE  EIGHTY-FIVE  PERCENT  OF  THE
MINIMUM WAGE IN ARTICLE NINETEEN OF THE LABOR LAW, THE DOLLAR AMOUNTS IN
THIS  SUBDIVISION SHALL BE REDUCED TO THE DIFFERENCE BETWEEN THE MINIMUM
WAGE IN ARTICLE NINETEEN OF THE LABOR LAW AND THE FEDERAL MINIMUM  WAGE.
SUCH REDUCTION WOULD TAKE EFFECT ON THE DATE THAT EMPLOYERS ARE REQUIRED
TO PAY SUCH FEDERAL MINIMUM WAGE.
  (D)  EMPLOYER PROHIBITION. AN EMPLOYER SHALL NOT DISCHARGE AN EMPLOYEE
AND HIRE AN ELIGIBLE EMPLOYEE SOLELY FOR THE PURPOSE OF  QUALIFYING  FOR
THIS  CREDIT.    AN  ELIGIBLE EMPLOYEE WHO IS USED AS THE BASIS FOR THIS
CREDIT MAY NOT BE USED AS THE BASIS OF ANY OTHER  CREDIT  ALLOWED  UNDER
THIS CHAPTER.
  (E)  CROSS  REFERENCES: FOR APPLICATION OF THE CREDIT PROVIDED IN THIS
SECTION, SEE THE FOLLOWING PROVISIONS OF THIS CHAPTER:
  (1) ARTICLE 9: SECTION 187-S.
  (2) ARTICLE 9-A: SECTION 210, SUBDIVISION 46.
  (3) ARTICLE 22: SECTION 606, SUBSECTION (AAA).
  (4) ARTICLE 32: SECTION 1456, SUBSECTION (Z).
  (5) ARTICLE 33: SECTION 1511, SUBDIVISION (CC).
  S 2. The tax law is amended by adding a new section 187-s to  read  as
follows:
  S  187-S MINIMUM WAGE REIMBURSEMENT CREDIT. (A) ALLOWANCE OF CREDIT. A
TAXPAYER SHALL BE ALLOWED A  CREDIT,  TO  BE  COMPUTED  AS  PROVIDED  IN
SECTION  THIRTY-EIGHT OF THIS CHAPTER AGAINST THE TAX IMPOSED BY SECTION
ONE HUNDRED EIGHTY-FIVE OF THIS ARTICLE.
  (B) APPLICATION OF CREDIT. THE CREDIT ALLOWED UNDER THIS  SECTION  FOR
ANY  TAXABLE  YEAR MAY NOT REDUCE THE TAX DUE FOR SUCH YEAR TO LESS THAN
THE MINIMUM TAX PRESCRIBED IN SUBDIVISION TWO  OF  SECTION  ONE  HUNDRED
EIGHTY-FIVE  OF  THIS ARTICLE.  HOWEVER, IF THE AMOUNT OF CREDIT ALLOWED
UNDER THIS SECTION FOR ANY TAXABLE YEAR REDUCES THE TAX TO SUCH  AMOUNT,
ANY  AMOUNT  OF  CREDIT THUS NOT DEDUCTIBLE IN SUCH TAXABLE YEAR WILL BE
TREATED AS AN OVERPAYMENT OF TAX TO BE CREDITED OR REFUNDED  IN  ACCORD-
ANCE  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
WILL BE PAID THEREON.
  S 3. Section 210 of the tax law is amended by adding a new subdivision
46 to read as follows:
  46. MINIMUM WAGE REIMBURSEMENT CREDIT.  (A)  ALLOWANCE  OF  CREDIT.  A
TAXPAYER  SHALL  BE  ALLOWED  A  CREDIT,  TO  BE COMPUTED AS PROVIDED IN
SECTION THIRTY-EIGHT OF THIS CHAPTER, AGAINST THE TAX  IMPOSED  BY  THIS
ARTICLE.
  (B)  APPLICATION  OF CREDIT. THE CREDIT ALLOWED UNDER THIS SUBDIVISION
FOR ANY TAXABLE YEAR MAY NOT REDUCE THE TAX DUE FOR SUCH  YEAR  TO  LESS

S. 2609--D                         90                         A. 3009--D

THAN  THE  AMOUNT PRESCRIBED IN PARAGRAPH (D) OF SUBDIVISION ONE OF THIS
SECTION. HOWEVER, IF THE AMOUNT OF CREDIT ALLOWED UNDER THIS SUBDIVISION
FOR ANY TAXABLE YEAR REDUCES THE TAX TO SUCH AMOUNT, ANY AMOUNT OF CRED-
IT  THUS NOT DEDUCTIBLE IN SUCH TAXABLE YEAR WILL BE TREATED AS AN OVER-
PAYMENT OF TAX TO  BE  CREDITED  OR  REFUNDED  IN  ACCORDANCE  WITH  THE
PROVISIONS OF SECTION ONE THOUSAND EIGHTY-SIX OF THIS CHAPTER. PROVIDED,
HOWEVER, THE PROVISIONS OF SUBSECTION (C) OF SECTION ONE THOUSAND EIGHT-
Y-EIGHT OF THIS CHAPTER NOTWITHSTANDING, NO INTEREST WILL BE PAID THERE-
ON.
  S  4. 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) MINIMUM WAGE REIMBURSEMENT    AMOUNT OF CREDIT UNDER SUBDIVISION
CREDIT UNDER SUBSECTION (AAA)        FORTY-SIX OF SECTION TWO HUNDRED
                                     TEN OR SUBSECTION (Z) OF
                                     SECTION FOURTEEN HUNDRED
                                     FIFTY-SIX
  S  5. Section 606 of the tax law is amended by adding a new subsection
(aaa) to read as follows:
  (AAA) MINIMUM WAGE REIMBURSEMENT  CREDIT.  (1)  A  TAXPAYER  SHALL  BE
ALLOWED  A CREDIT, TO BE COMPUTED AS PROVIDED IN SECTION THIRTY-EIGHT OF
THIS CHAPTER, AGAINST THE TAX IMPOSED BY THIS ARTICLE.
  (2) APPLICATION OF CREDIT. IF THE AMOUNT OF THE CREDIT  ALLOWED  UNDER
THIS SUBSECTION FOR ANY TAXABLE YEAR EXCEEDS THE TAXPAYER'S TAX FOR SUCH
YEAR, THE EXCESS WILL 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 WILL  BE
PAID THEREON.
  S 6. Section 1456 of the tax law is amended by adding a new subsection
(z) to read as follows:
  (Z)  MINIMUM  WAGE  REIMBURSEMENT  CREDIT.  (1) ALLOWANCE OF CREDIT. A
TAXPAYER SHALL BE ALLOWED A CREDIT, TO BE  COMPUTED  AS  PROVIDED  UNDER
SECTION  THIRTY-EIGHT  OF  THIS CHAPTER, AGAINST THE TAX IMPOSED BY THIS
ARTICLE.
  (2) APPLICATION OF CREDIT. THE CREDIT ALLOWED  UNDER  THIS  SUBSECTION
FOR ANY TAXABLE YEAR SHALL NOT, IN THE AGGREGATE, REDUCE THE TAX DUE FOR
SUCH  YEAR  TO  LESS  THAN  THE  MINIMUM  TAX FIXED BY SUBSECTION (B) OF
SECTION FOURTEEN HUNDRED FIFTY-FIVE OF THIS  ARTICLE.  HOWEVER,  IF  THE
AMOUNT  OF  CREDIT  OF SUCH CREDIT ALLOWED UNDER THIS SUBSECTION FOR ANY
TAXABLE YEAR REDUCES THE TAX TO SUCH AMOUNT, THEN ANY AMOUNT  OF  CREDIT
THUS  NOT  DEDUCTIBLE  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.
  S  7.  Section 1511 of the tax law is amended by adding a new subdivi-
sion (cc) to read as follows:
  (CC) MINIMUM WAGE REIMBURSEMENT CREDIT. (1) ALLOWANCE OF  CREDIT.    A
TAXPAYER  SHALL  BE  ALLOWED  A CREDIT, TO BE COMPUTED AS PROVIDED UNDER
SECTION THIRTY-EIGHT OF THIS CHAPTER, AGAINST THE TAX  IMPOSED  BY  THIS
ARTICLE.
  (2)  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  MINIMUM  TAX  FIXED  BY  PARAGRAPH FOUR OF SUBDIVISION (A) OF
SECTION FIFTEEN HUNDRED TWO  OF  THIS  ARTICLE  OR  BY  SECTION  FIFTEEN
HUNDRED  TWO-A OF THIS ARTICLE, WHICHEVER IS APPLICABLE. HOWEVER, IF THE

S. 2609--D                         91                         A. 3009--D

AMOUNT OF CREDIT ALLOWED UNDER THIS SUBDIVISION  FOR  ANY  TAXABLE  YEAR
REDUCES  THE  TAX  TO  SUCH  AMOUNT,  THEN 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.
  S 8. This act shall take effect immediately.

                                 PART FF

  Section 1. Paragraph 1 of subsection (a) of section 601 of the tax law
as added by section 1 of part A of chapter 56 of the laws  of  2011,  is
amended to read as follows:
  (1)  (A)  For  taxable  years  beginning after two thousand eleven and
before two thousand [fifteen] EIGHTEEN:

If the New York taxable income is:    The tax is:
Not over $16,000                      4% of taxable income
Over $16,000 but not over $22,000     $640 plus 4.5% of excess over
                                      $16,000
Over $22,000 but not over $26,000     $910 plus 5.25% of excess over
                                      $22,000
Over $26,000 but not over $40,000     $1,120 plus 5.90% of excess over
                                      $26,000
Over $40,000 but not over $150,000    $1,946 plus 6.45% of excess over
                                      $40,000
Over $150,000 but not over $300,000   $9,041 plus 6.65% of excess over
                                      $150,000
Over $300,000 but not over $2,000,000 $19,016 plus 6.85% of excess over
                                      $300,000
Over $2,000,000                       $135,466 plus 8.82% of excess over
                                      $2,000,000

  (B) For taxable years beginning after two thousand  [fourteen]  SEVEN-
TEEN, the following brackets and dollar amounts shall apply, as adjusted
by the cost of living adjustment prescribed in section six hundred one-a
of this part for tax years two thousand thirteen [and two thousand four-
teen] THROUGH TWO THOUSAND SEVENTEEN:

If the New York taxable income is:    The tax is:
Not over $16,000                      4% of taxable income
Over $16,000 but not over $22,000     $640 plus 4.5% of excess over
                                      $16,000
Over $22,000 but not over $26,000     $910 plus 5.25% of excess over
                                      $22,000
Over $26,000 but not over $40,000     $1,120 plus 5.90% of excess over
                                      $26,000
Over $40,000                          $1,946 plus 6.85% of excess over
                                      $40,000

  S  2.  Paragraph  1 of subsection (b) of section 601 of the tax law as
added by section 3 of part A of chapter 56  of  the  laws  of  2011,  is
amended to read as follows:
  (1)  (A)  For  taxable  years  beginning after two thousand eleven and
before two thousand [fifteen] EIGHTEEN:

S. 2609--D                         92                         A. 3009--D

If the New York taxable income is:    The tax is:

Not over $12,000                      4% of taxable income
Over $12,000 but not over $16,500     $480 plus 4.5% of excess over
                                      $12,000
Over $16,500 but not over $19,500     $683 plus 5.25% of excess over
                                      $16,500
Over $19,500 but not over $30,000     $840 plus 5.90% of excess over
                                      $19,500
Over $30,000 but not over $100,000    $1,460 plus 6.45% of excess over
                                      $30,000
Over $100,000 but not over $250,000   $5,975 plus 6.65% of excess over
                                      $100,000
Over $250,000 but not over $1,500,000 $15,950 plus 6.85% of excess over
                                      $250,000
Over $1,500,000                       $101,575 plus 8.82% of excess over
                                      $1,500,000

  (B)  For  taxable years beginning after two thousand [fourteen] SEVEN-
TEEN, the  following  brackets  and  dollars  amounts  shall  apply,  as
adjusted  by  the  cost  of  living adjustment prescribed in section six
hundred one-a of this part for tax years two thousand thirteen [and  two
thousand fourteen] THROUGH TWO THOUSAND SEVENTEEN:

If the New York taxable income is:    The tax is:
Not over $12,000                      4% of taxable income
Over $12,000 but not over $16,500     $480 plus 4.5% of excess over
                                      $12,000
Over $16,500 but not over $19,500     $683 plus 5.25% of excess over
                                      $16,500
Over $19,500 but not over $30,000     $840 plus 5.90% of excess over
                                      $19,500
Over $30,000                          $1,460 plus 6.85% of excess over
                                      $30,000

  S  3.  Paragraph  1 of subsection (c) of section 601 of the tax law as
added by section 5 of part A of chapter 56  of  the  laws  of  2011,  is
amended to read as follows:
  (1)  (A)  For  taxable  years  beginning after two thousand eleven and
before two thousand [fifteen] EIGHTEEN:

If the New York taxable income is:    The tax is:
Not over $8,000                       4% of taxable income
Over $8,000 but not over $11,000      $320 plus 4.5% of excess over
                                      $8,000
Over $11,000 but not over $13,000     $455 plus 5.25% of excess over
                                      $11,000
Over $13,000 but not over $20,000     $560 plus 5.90% of excess over
                                      $13,000
Over $20,000 but not over $75,000     $973 plus 6.45% of excess over
                                      $20,000
Over $75,000 but not over $200,000    $4,521 plus 6.65% of excess over
                                      $75,000
Over $200,000 but not over $1,000,000 $12,833 plus 6.85% of excess over
                                      $200,000
Over $1,000,000                       $67,633 plus 8.82% of excess over

S. 2609--D                         93                         A. 3009--D

                                      $1,000,000

  (B)  For  taxable years beginning after two thousand [fourteen] SEVEN-
TEEN, the  following  brackets  and  dollars  amounts  shall  apply,  as
adjusted  by  the  cost  of  living adjustment prescribed in section six
hundred one-a of this part for tax years two thousand thirteen [and  two
thousand fourteen] THROUGH TWO THOUSAND SEVENTEEN:

If the New York taxable income is:    The tax is:
Not over $8,000                       4% of taxable income
Over $8,000 but not over $11,000      $320 plus 4.5% of excess over
                                      $8,000
Over $11,000 but not over $13,000     $455 plus 5.25% of excess over
                                      $11,000
Over $13,000 but not over $20,000     $560 plus 5.90% of excess over
                                      $13,000
Over $20,000                          $973 plus 6.85% of excess over
                                      $20,000

  S  4.  The opening paragraph of subsection (d-1) of section 601 of the
tax law as added by section 7 of part A of chapter 56  of  the  laws  of
2011, is amended to read as follows:
  Alternative   tax   table   benefit   recapture.  Notwithstanding  the
provisions of subsection (d) of this section, for taxable  years  begin-
ning  after  two thousand eleven and before two thousand [fifteen] EIGH-
TEEN, there is hereby imposed a supplemental tax in addition to the  tax
imposed  under  subsections  (a),  (b)  and  (c) of this section for the
purpose of recapturing the benefit of the tax tables contained  in  such
subsections.  During  these taxable years, any reference in this chapter
to subsection (d) of this section shall be read as a reference  to  this
subsection.
  S  5.   Subparagraph (D) of paragraph 1 of subsection (d-1) of section
601 of the tax law, as added by section 7 of part A of chapter 56 of the
laws of 2011, is amended to read as follows:
  (D) The tax table benefit is the difference between (i) the amount  of
taxable income set forth in the tax table in paragraph one of subsection
(a)  of this section not subject to the 8.82 percent rate of tax for the
taxable year multiplied by such rate and (ii) the dollar denominated tax
for such amount of taxable income set forth in the tax table  applicable
to  the  taxable year in paragraph one of subsection (a) of this section
less the sum of the tax table benefits in subparagraphs (A), (B) and (C)
of this paragraph. The fraction for this  subparagraph  is  computed  as
follows:  the  numerator  is the lesser of fifty thousand dollars or the
excess of New York adjusted gross income for the taxable year  over  two
million  dollars  and  the  denominator  is fifty thousand dollars. This
subparagraph shall apply only to taxable years  beginning  on  or  after
January  first,  two thousand twelve and before January first, two thou-
sand [fifteen] EIGHTEEN.
  S 6.  Subparagraph (C) of paragraph 2 of subsection (d-1)  of  section
601 of the tax law, as added by section 7 of part A of chapter 56 of the
laws of 2011, is amended to read as follows:
  (C)  The tax table benefit is the difference between (i) the amount of
taxable income set forth in the tax table in paragraph one of subsection
(b) of this section not subject to the 8.82 percent rate of tax for  the
taxable year multiplied by such rate and (ii) the dollar denominated tax
for  such amount of taxable income set forth in the tax table applicable

S. 2609--D                         94                         A. 3009--D

to the taxable year in paragraph one of subsection (b) of  this  section
less  the  sum of the tax table benefits in subparagraphs (A) and (B) of
this paragraph. The  fraction  for  this  subparagraph  is  computed  as
follows:  the  numerator  is the lesser of fifty thousand dollars or the
excess of New York adjusted gross income for the taxable year  over  one
million five hundred thousand dollars and the denominator is fifty thou-
sand dollars. This subparagraph shall apply only to taxable years begin-
ning  on  or after January first, two thousand twelve and before January
first, two thousand [fifteen] EIGHTEEN.
  S 7. Subparagraph (C) of paragraph 3 of subsection  (d-1)  of  section
601 of the tax law, as added by section 7 of part A of chapter 56 of the
laws of 2011, is amended to read as follows:
  (C)  The tax table benefit is the difference between (i) the amount of
taxable income set forth in the tax table in paragraph one of subsection
(b) of this section not subject to the 8.82 percent rate of tax for  the
taxable year multiplied by such rate and (ii) the dollar denominated tax
for  such amount of taxable income set forth in the tax table applicable
to the taxable year in paragraph one of subsection (b) of  this  section
less  the  sum of the tax table benefits in subparagraphs (A) and (B) of
this paragraph. The  fraction  for  this  subparagraph  is  computed  as
follows:  the  numerator  is the lesser of fifty thousand dollars or the
excess of New York adjusted gross income for the taxable year  over  one
million five hundred thousand dollars and the denominator is fifty thou-
sand dollars. This subparagraph shall apply only to taxable years begin-
ning  on  or after January first, two thousand twelve and before January
first, two thousand [fifteen] EIGHTEEN.
  S 8.  The opening paragraph of subsection (d-2) of section 601 of  the
tax  law,  as  added by section 8 of part A of chapter 56 of the laws of
2011, is amended to read as follows:
  Tax table benefit recapture for tax years after  two  thousand  [four-
teen]  SEVENTEEN.  For taxable years beginning after two thousand [four-
teen] SEVENTEEN, there is hereby imposed a supplemental tax in  addition
to  the  tax  imposed under subsections (a), (b) and (c) of this section
for the purpose of recapturing the benefit of the tax  tables  contained
in  such subsections.   The supplemental tax shall be an amount equal to
the table benefit in paragraph one of this subsection multiplied by  the
fraction in such paragraph. [Any] DURING THESE TAXABLE YEARS, ANY refer-
ence  in this chapter to subsection (d) of this section shall be read as
a reference to this subsection.
  S 9.  Subparagraph (B) of paragraph 1 of subsection (d-2)  of  section
601  of  the  tax law, as added by section 8 of  part A of chapter 56 of
the laws of 2011, is amended to read as follows:
  (B) The fraction is computed as follows: the numerator is  the  lesser
of  fifty  thousand  dollars  or  the  excess of New York adjusted gross
income for the taxable year over one hundred thousand dollars  (as  such
amount  is  adjusted  by  the  cost  of  living adjustment prescribed in
section six hundred one-a of this part for tax years two thousand  thir-
teen  [and] THROUGH two thousand [fourteen] SEVENTEEN) and the denomina-
tor is fifty thousand dollars.
  S 10.  Subsection (a) of section 601-a of the tax  law,  as  added  by
section  9  of  part  A of chapter 56 of the laws of 2011, is amended to
read as follows:
  (a) For tax year two thousand thirteen, the  commissioner,  not  later
than  September  first,  two thousand twelve, shall multiply the amounts
specified in subsection (b) of this section for tax  year  two  thousand
twelve by one plus the cost of living adjustment described in subsection

S. 2609--D                         95                         A. 3009--D

(c) of this section. For tax year two thousand fourteen, the commission-
er,  not later than September first, two thousand thirteen, shall multi-
ply the amounts specified in subsection (b) of this section for tax year
two  thousand  thirteen  by one plus the cost of living adjustment.  FOR
EACH SUCCEEDING TAX YEAR AFTER TAX YEAR TWO THOUSAND FOURTEEN AND BEFORE
TAX YEAR TWO THOUSAND EIGHTEEN, THE COMMISSIONER, NOT LATER THAN SEPTEM-
BER FIRST OF SUCH TAX YEAR, SHALL  MULTIPLY  THE  AMOUNTS  SPECIFIED  IN
SUBSECTION (B) OF THIS SECTION FOR SUCH TAX YEAR BY ONE PLUS THE COST OF
LIVING  ADJUSTMENT  DESCRIBED IN SUBSECTION (C) OF THIS SECTION FOR SUCH
TAX YEAR.
  S 11. Subsection (f) of section 614  of  the  tax  law,  as  added  by
section  10  of  part A of chapter 56 of the laws of 2011, is amended to
read as follows:
  (f) Adjusted standard deduction. For taxable years beginning after two
thousand [fourteen] SEVENTEEN, the standard deductions set forth in this
section shall be THE AMOUNTS SET FORTH IN THIS SECTION adjusted  by  the
cost  of  living  adjustment  prescribed in section six hundred one-a of
this part for tax years two thousand thirteen [and  two  thousand  four-
teen] THROUGH TWO THOUSAND SEVENTEEN.
  S  12.  Section  11  of  part  A  of chapter 56 of the laws of 2011 is
amended to read as follows:
  S 11. Notwithstanding any provision of law to the contrary, the method
of determining the amount to be deducted  and  withheld  from  wages  on
account  of  taxes imposed by or pursuant to the authority of article 22
of the tax law in connection with the implementation of  the  provisions
of  this  act  shall be prescribed by regulations of the commissioner of
taxation and finance with due consideration to the effect such withhold-
ing tables and methods would have on the receipt and amount of  revenue.
The  commissioner  of taxation and finance shall adjust such withholding
tables and methods in regard to taxable  years  beginning  in  2012  and
after in such manner as to result, so far as practicable, in withholding
from  an  employee's wages an amount substantially equivalent to the tax
reasonably estimated to be due for such taxable years as a result of the
provisions of this act. Any such regulations to implement  a  change  in
withholding  tables  and  methods for tax year 2012 shall be adopted and
effective as soon as practicable and the commissioner  of  taxation  and
finance may adopt such regulations on an emergency basis notwithstanding
anything  to  the  contrary  in  section 202 of the state administrative
procedure act. The commissioner of taxation and finance, in carrying out
the duties and responsibilities under this section, may accompany such a
rule making procedure with a similar procedure with respect to the taxes
required to be deducted and withheld by local laws imposing taxes pursu-
ant to the authority of articles 30, 30-A and 30-B of the tax  law,  the
provisions  of  any  other  law  in  relation to such a procedure to the
contrary notwithstanding. The withholding tables  and  methods  for  tax
years  2013  [and  2014]  THROUGH  2017 shall not be prescribed by regu-
lation, notwithstanding any provision of the state administrative proce-
dure act to the contrary.
  S 13. Section 11-1714 of the administrative code of the  city  of  New
York is amended by adding a new subdivision (f) to read as follows:
  (F)  FOR  TAXABLE YEARS BEGINNING ON OR AFTER JANUARY FIRST, TWO THOU-
SAND THIRTEEN, THE AMOUNTS OF STANDARD  DEDUCTIONS  SET  FORTH  IN  THIS
SECTION  SHALL BE ADJUSTED IN THE SAME MANNER AS THE AMOUNTS OF STANDARD
DEDUCTIONS SET FORTH IN SECTION SIX HUNDRED FOURTEEN OF THE TAX LAW.
  S 14. This act shall take effect immediately.

S. 2609--D                         96                         A. 3009--D

                                 PART GG

  Section  1.  The  tax  law is amended by adding a new section 630-c to
read as follows:
  S 630-C. GIFT FOR NEW YORK STATE TEEN HEALTH EDUCATION FUND. AN  INDI-
VIDUAL  IN  ANY  TAXABLE YEAR MAY ELECT TO CONTRIBUTE TO THE TEEN HEALTH
EDUCATION FUND FOR EDUCATIONAL PROGRAMS IN SCHOOLS  RELATED  TO  HEALTH.
THE  CONTRIBUTION  SHALL  BE  IN  ANY  WHOLE DOLLAR AMOUNT AND SHALL NOT
REDUCE THE AMOUNT OF STATE TAX OWED BY SUCH INDIVIDUAL. THE COMMISSIONER
SHALL INCLUDE SPACE ON THE  PERSONAL  INCOME  TAX  RETURN  TO  ENABLE  A
TAXPAYER  TO MAKE SUCH CONTRIBUTION. NOTWITHSTANDING ANY OTHER PROVISION
OF LAW ALL REVENUES COLLECTED PURSUANT TO THIS SECTION SHALL BE CREDITED
TO THE NEW YORK STATE TEEN HEALTH EDUCATION FUND AND USED ONLY FOR THOSE
PURPOSES ENUMERATED IN SECTION NINETY-NINE-U OF THE STATE FINANCE LAW.
  S 2. The state finance law is amended by adding a new section 99-u  to
read as follows:
  S  99-U. NEW YORK STATE TEEN HEALTH EDUCATION FUND. 1. THERE IS HEREBY
ESTABLISHED IN THE CUSTODY OF THE COMMISSIONER OF TAXATION AND FINANCE A
SPECIAL ACCOUNT TO BE KNOWN AS THE "NEW YORK STATE TEEN HEALTH EDUCATION
FUND".
  2. SUCH FUND SHALL CONSIST OF ALL REVENUES RECEIVED BY THE  DEPARTMENT
OF  TAXATION  AND  FINANCE,  PURSUANT  TO  THE PROVISIONS OF SECTION SIX
HUNDRED THIRTY-C OF THE TAX LAW AND ALL OTHER MONEYS APPROPRIATED THERE-
TO FROM ANY OTHER FUND OR SOURCE PURSUANT TO LAW. NOTHING  CONTAINED  IN
THIS  SECTION  SHALL  PREVENT  THE STATE FROM RECEIVING GRANTS, GIFTS OR
BEQUESTS FOR THE PURPOSES OF THE FUND AS DEFINED  IN  THIS  SECTION  AND
DEPOSITING THEM INTO THE FUND ACCORDING TO LAW.
  3.  THE MONEYS IN SAID ACCOUNT SHALL BE RETAINED BY THE FUND AND SHALL
BE RELEASED BY THE  COMMISSIONER  OF  TAXATION  AND  FINANCE  ONLY  UPON
CERTIFICATES  SIGNED  BY  THE  COMMISSIONER  OF  EDUCATION OR HIS OR HER
DESIGNEE AND ONLY FOR THE PURPOSES SET FORTH IN THIS SECTION.
  4. THE MONEYS IN SUCH FUND  SHALL  BE  EXPENDED  FOR  THE  PURPOSE  OF
SUPPLEMENTING  EDUCATIONAL  PROGRAMS IN SCHOOLS FOR HEALTH AND AWARENESS
OF ISSUES FACING TEENS TODAY WHEN IT COMES TO THEIR  HEALTH.    ELIGIBLE
HEALTH  PROGRAMS  ARE  THOSE  WITH  AN  ESTABLISHED CURRICULUM PROVIDING
INSTRUCTION ON ALCOHOL, TOBACCO AND OTHER  DRUG  ABUSE  PREVENTION,  THE
CAUSES  AND  PROBLEMS ASSOCIATED WITH TEEN OBESITY, AND FOR AWARENESS OF
THE SYMPTOMS OF TEEN ENDOMETRIOSIS.
  S 3. This act shall take effect immediately.

                                 PART HH

  Section 1. Subdivision 11 of section 213 of the state finance  law  is
amended by adding a new paragraph (g) to read as follows:
  (G)  A  QUALIFYING  TECHNOLOGY  OR  INNOVATION BUSINESS WHICH BUSINESS
EMPLOYS ONE HUNDRED OR FEWER EMPLOYEES WITHIN THE STATE ON  A  FULL-TIME
BASIS AND ENGAGES IN:
  (1)  BIOTECHNOLOGIES, WHICH SHALL BE DEFINED AS TECHNOLOGIES INVOLVING
THE SCIENTIFIC MANIPULATION  OF  LIVING  ORGANISMS,  ESPECIALLY  AT  THE
MOLECULAR  AND/OR  THE  SUB-MOLECULAR GENETIC LEVEL, TO PRODUCE PRODUCTS
CONDUCIVE TO IMPROVING THE LIVES AND  HEALTH  OF  PLANTS,  ANIMALS,  AND
HUMANS; AND THE ASSOCIATED SCIENTIFIC RESEARCH, PHARMACOLOGICAL, MECHAN-
ICAL,  AND  COMPUTATIONAL APPLICATIONS AND SERVICES CONNECTED WITH THESE
IMPROVEMENTS;

S. 2609--D                         97                         A. 3009--D

  (2) INFORMATION AND COMMUNICATION TECHNOLOGIES, EQUIPMENT AND  SYSTEMS
THAT  INVOLVE  ADVANCED  COMPUTER  SOFTWARE  AND HARDWARE, VISUALIZATION
TECHNOLOGIES, AND HUMAN INTERFACE TECHNOLOGIES;
  (3)  ADVANCED  MATERIALS  AND PROCESSING TECHNOLOGIES THAT INVOLVE THE
DEVELOPMENT, MODIFICATION, OR IMPROVEMENT OF ONE OR  MORE  MATERIALS  OR
METHODS  TO  PRODUCE  DEVICES  AND  STRUCTURES WITH IMPROVED PERFORMANCE
CHARACTERISTICS OR SPECIAL FUNCTIONAL ATTRIBUTES, OR TO ACTIVATE,  SPEED
UP, OR OTHERWISE ALTER CHEMICAL, BIOCHEMICAL, OR MEDICAL PROCESSES;
  (4)  ELECTRONIC AND PHOTONIC DEVICES AND COMPONENTS FOR USE IN PRODUC-
ING ELECTRONIC, OPTOELECTRONIC, MECHANICAL  EQUIPMENT  AND  PRODUCTS  OF
ELECTRONIC DISTRIBUTION WITH INTERACTIVE MEDIA CONTENT;
  (5)  ENERGY  EFFICIENCY,  RENEWABLE ENERGY AND ENVIRONMENTAL TECHNOLO-
GIES, PRODUCTS, DEVICES AND SERVICES; OR
  (6) SMALL SCALE SYSTEMS INTEGRATION AND PACKAGING.
  S 2. Paragraph (a) of subdivision 16  of  section  213  of  the  state
finance  law,  as amended by chapter 424 of the laws of 2009, is amended
to read as follows:
  (a) for a linked deposit made in connection with a linked  loan  to  a
certified  business in an empire zone or to an eligible business located
in a highly distressed area or to an eligible business that  is  defined
in paragraph (b-1) of subdivision eleven of this section that is located
in a renewal community or defined in paragraph (b-2) of such subdivision
that  is located in an empowerment zone or defined in paragraph (b-3) of
such subdivision that is located in an enterprise community, OR A QUALI-
FYING TECHNOLOGY OR INNOVATION BUSINESS AS DEFINED IN PARAGRAPH  (G)  OF
SUBDIVISION  ELEVEN  OF THIS SECTION, respectively for eligible projects
defined in paragraph (c) of subdivision twelve  of  this  section  or  a
certified  minority-  or women-owned business enterprise for an eligible
project defined in paragraph (e) of subdivision twelve of  this  section
or to a defense industry manufacturer for a project defined in paragraph
(d)  of  subdivision  twelve  of  this section, a fixed rate of interest
which is three hundred basis points below the lender's posted four  year
certificate of deposit rate or, if the lender does not offer a four year
certificate  of deposit, is three hundred basis points below the average
statewide rate for four year certificates of deposit  as  determined  by
the commissioner of economic development;
  S 3. This act shall take effect immediately.

                                 PART II

  Section  1.  Section  16-t  of section 1 of chapter 168 of the laws of
1974, constituting the New York state urban development corporation act,
as added by section 1 of part N of chapter 59 of the laws  of  2010,  is
amended to read as follows:
  S  16-t.  Small  business  revolving  loan fund. 1. The small business
revolving loan fund  program  is  hereby  created.  The  corporation  is
authorized,  within  available  appropriations,  to provide low interest
loans to community  development  financial  institutions,  in  order  to
provide  funding  for  those lending organizations' loans to small busi-
nesses, located within New York state, that generate economic growth and
job creation within New  York  state  but  that  are  unable  to  obtain
adequate  credit or adequate terms for such credit. If in the discretion
of the corporation the use of a community development financial institu-
tion is not practicable based upon the application of  rules  and  regu-
lations  developed  by  the  corporation, including, but not limited to,
assessments of geographic and administrative capacity, then  the  corpo-

S. 2609--D                         98                         A. 3009--D

ration  is  authorized,  within available appropriations, to provide low
interest loans to the following  other  local  community  based  lending
organizations:  small  business lending consortia, certified development
companies, providers of United States department of agriculture business
and  industrial  guaranteed loans, United States small business adminis-
tration loan providers, credit unions and community banks.  As  used  in
this  section  "small business" means a business that is resident in New
York state, independently owned and operated, not dominant in its field,
and employs one hundred or fewer persons.
  2. In order for a lending  organization  to  be  eligible  to  receive
program  funds, it must have established sufficient expertise to analyze
small business applications for program loans, evaluate  the  creditwor-
thiness  of  small  businesses, and regularly monitor program loans. The
lending organization shall review  every  program  loan  application  in
order  to determine, among other things, the feasibility of the proposed
use of the requested financing by  the  small  business  applicant,  the
likelihood  of  repayment  and the potential that the loan will generate
economic development and jobs within New  York  state.  The  corporation
shall  identify  eligible  lending  organizations  through  one  or more
competitive statewide or local solicitations.
  3. Program loans to small businesses shall be targeted and marketed to
minority and women-owned enterprises and other small businesses that are
having difficulty accessing traditional credit markets. Program loans to
small businesses shall be used for the creation and retention  of  jobs,
as  defined  by the corporation, including: (a) working capital; (b) the
acquisition and/or improvement of real property; (c) the acquisition  of
machinery and equipment, property or improvement; or (d) the refinancing
of  debt  obligations.  There  shall be two categories of loans to small
businesses: a micro loan that shall have a principal amount that is less
than twenty-five thousand dollars and a regular loan that shall  have  a
principal  amount  not  less than twenty-five thousand dollars. Prior to
receiving program funds, the lending organization must  certify  to  the
corporation  that  such  loan  complies  with this section and rules and
regulations promulgated for the program and that the  lending  organiza-
tion has performed its obligations pursuant to and is in compliance with
this  section,  the  program  rules  and  regulations and all agreements
entered into between the corporation and the lending  organization.  The
program  funds amount used by the lending organization to fund a program
applicant loan shall not be more than fifty  percent  of  the  principal
amount of such loan. The program funds amount used by the lending organ-
ization  to  fund a program applicant loan shall not be greater than one
hundred and twenty-five thousand dollars.    MINORITY-  AND  WOMEN-OWNED
BUSINESS  ENTERPRISES AND OTHER SMALL BUSINESSES WHO ACCESS SUCH PROGRAM
LOANS UNDER THIS SUBDIVISION SHALL NOT BE PRECLUDED FROM ACCESSING  SUCH
SHORT-TERM  FINANCING  LOANS  PROVIDED  UNDER SUBDIVISION ELEVEN OF THIS
SECTION.
  4. Program funds shall not be used for: (a) projects that would result
in the relocation of any business operation from one municipality within
the state to another, except under one of the following conditions:  (i)
when a business is relocating within a municipality with a population of
at  least  one  million  where  the  governing body of such municipality
approves such relocation; or (ii) the lending organization notifies each
municipality from which such business operation will  be  relocated  and
each municipality agrees to such relocation; (b) projects of newspapers,
broadcasting  or other news media; medical facilities, libraries, commu-
nity or civic centers; or public infrastructure  improvements;  and  (c)

S. 2609--D                         99                         A. 3009--D

providing  funds,  directly or indirectly, for payment, distribution, or
as a loan, to owners, members, partners or shareholders of the applicant
business, except as ordinary income for services rendered.
  5.  With  respect  to  its program loans, the lending organization may
charge application, commitment and loan guarantee  fees  pursuant  to  a
schedule of fees adopted by the lending organization and approved by the
corporation.
  6.  Program  funds shall be disbursed to a lending organization by the
corporation in the form of a loan to the lending organization. The  term
of the loan shall commence upon disbursement of the program funds by the
corporation  to  the  lending  organization.  The loan shall carry a low
interest rate determined by the corporation  based  on  then  prevailing
interest  rates  and  the  circumstances  of  the  lending organization.
Notwithstanding the performance of the loans made by the lending  organ-
ization  using  program  funds,  the  lending  organization shall remain
liable to the corporation with respect to any unpaid  amounts  due  from
the  lending  organization  pursuant  to  the terms of the corporation's
loans to the lending organization. In addition,  a  portion  of  program
funds  may be disbursed to a lending organization in the form of a grant
or forgivable loan, provided those funds are used by the lending  organ-
ization  for administrative expenses associated with the fund, loan-loss
reserves, or other eligible expenses as determined by the corporation.
  7. Notwithstanding anything to  the  contrary  in  this  section,  the
corporation  shall  provide  at  least  five hundred thousand dollars in
program funds pursuant to this section to lending organizations for  the
purpose of making loans to small business located in Niagara county.
  8.  Notwithstanding  anything  to  the  contrary  in this section, the
corporation shall provide at least  five  hundred  thousand  dollars  in
program  funds pursuant to this section to lending organizations for the
purpose of making loans to small business located in St. Lawrence  coun-
ty.
  9.  Notwithstanding  anything  to  the  contrary  in this section, the
corporation shall provide at least  five  hundred  thousand  dollars  in
program  funds pursuant to this section to lending organizations for the
purpose of making loans to small business located in Erie county.
  10. Notwithstanding anything to the  contrary  in  this  section,  the
corporation  shall  provide  at  least  five hundred thousand dollars in
program funds pursuant to this section to lending organizations for  the
purpose of making loans to small business located in Jefferson county.
  11.    NOTWITHSTANDING  ANYTHING  TO THE CONTRARY IN THIS SECTION, THE
CORPORATION MAY PROVIDE  AT  LEAST  FIVE  HUNDRED  THOUSAND  DOLLARS  IN
PROGRAM  FUNDS PURSUANT TO THIS SECTION TO LENDING ORGANIZATIONS FOR THE
PURPOSE OF  MAKING  SHORT-TERM  FINANCING  AVAILABLE  TO  MINORITY-  AND
WOMEN-OWNED  BUSINESS  ENTERPRISES AND OTHER SMALL BUSINESSES PERFORMING
CONTRACTS TO PROVIDE CONSTRUCTION OR  PROFESSIONAL  SERVICES  FOR  STATE
PROCUREMENT PURPOSES. SUCH LOANS SHALL BE USED TO UNDERWRITE THE COST OF
LABOR,  MATERIALS,  AND  EQUIPMENT  DIRECTLY  ASSOCIATED  WITH  (1)  THE
CONTRACT BEING FINANCED OR (2) A CONTRACT THAT HAS  BEEN  SATISFIED  FOR
WHICH THE BUSINESS IS AWAITING PAYMENT FROM THE STATE. THE PROGRAM FUNDS
AMOUNT USED BY THE LENDING ORGANIZATION TO FUND A PROGRAM APPLICANT LOAN
SHALL  NOT  BE  MORE THAN EIGHTY PERCENT OF THE PRINCIPAL AMOUNT OF SUCH
LOAN.  THE PROGRAM FUNDS AMOUNT USED BY THE LENDING ORGANIZATION TO FUND
A  PROGRAM  APPLICANT  LOAN  SHALL  NOT  BE  GREATER  THAN  ONE  HUNDRED
TWENTY-FIVE  THOUSAND DOLLARS. MINORITY- AND WOMEN-OWNED BUSINESS ENTER-
PRISES AND OTHER SMALL BUSINESSES WHO ACCESS SUCH  SHORT-TERM  FINANCING

S. 2609--D                         100                        A. 3009--D

LOANS  UNDER THIS SUBDIVISION SHALL NOT BE PRECLUDED FROM ACCESSING SUCH
PROGRAM LOANS PROVIDED UNDER SUBDIVISION THREE OF THIS SECTION.
  12.  Notwithstanding  any provision of law to the contrary, the corpo-
ration may establish a program fund for program use and  pay  into  such
fund  any  funds  available  to the corporation from any source that are
eligible for program use, including moneys appropriated by the state.
  [12.] 13. With respect to a lending organization program  loan  appli-
cants,  no  person who is a member of the board or other governing body,
officer, employee, or member of a loan committee, or a family member  of
any  such lending organization shall participate in any decision on such
application if such person is a party to or has a financial or  personal
interest  in  such  loan.  Any  person  who cannot participate in a loan
application decision for such reasons shall not be counted as  a  member
of  the  loan  committee,  board or other governing body for purposes of
determining the number of members required for approval of such applica-
tion.
  [13.] 14. The lending organization shall  submit  to  the  corporation
annual  reports stating: the number of program loans made; the amount of
program funding used for loans; the use of loan proceeds by the  borrow-
er; the number of jobs created or retained; a description of the econom-
ic  development  generated; the status of each outstanding program loan;
and such other information as the corporation may require.
  [14.] 15. The corporation may conduct audits of the lending  organiza-
tion  in order to ensure compliance with the provisions of this section,
any regulations promulgated with respect thereto and agreements  between
the  lending  organization and the corporation of all aspects of the use
of program funds and program loan transactions. In the  event  that  the
corporation  finds substantive noncompliance, the corporation may termi-
nate the lending organization's participation in the program.
  [15.] 16. Upon termination of a lending  organization's  participation
in  the  program,  the  lending  organization shall return to the corpo-
ration, promptly after its demand therefor, all  program  fund  proceeds
held  by  the  lending  organization;  and  provide  to the corporation,
promptly after its demand therefor, an accounting of all  program  funds
received  by the lending organization, including all currently outstand-
ing loans that were  made  using  program  funds.  Notwithstanding  such
termination,  the lending organization shall remain liable to the corpo-
ration with respect to any unpaid amounts due from the lending organiza-
tion pursuant to the terms of the corporation's  loans  to  the  lending
organization.
  S 2. This act shall take effect immediately.

                                 PART JJ

  Section  1. Legislative findings and purposes. It is hereby found that
there exists in the state a need to attract private sector investment in
new research and in the translation of the  products  of  that  research
into marketable products.
  It is hereby further found that the need for this investment is demon-
strated  by the fact that, while New York state universities rank second
nationally in total research spending, the state attracts  a  dispropor-
tionately low share of the nation's venture capital investment.
  S  2.  The New York state innovation venture capital fund. In order to
strengthen the university/industry connection and prepare New York busi-
nesses to compete for private-sector venture investment,  the  New  York
state  urban  development  corporation shall have the power to establish

S. 2609--D                         101                        A. 3009--D

and administer the New York state innovation  venture  capital  fund  to
provide  critical  seed and early-stage funding to incentivize new busi-
ness formation and growth in New York state and to facilitate the  tran-
sition  from  ideas  and  research to marketable products. Funds will be
expended by the innovation venture  capital  fund  pursuant  to  a  plan
developed  by  the  urban  development  corporation and submitted to the
director of the division of the budget, the temporary president  of  the
senate,  the  speaker of the assembly, the minority leader of the senate
and the minority leader of the assembly.  No funds shall be  transferred
to  the  New  York  state urban development corporation for the New York
state innovation venture capital fund until such plan has  been  submit-
ted.
  S  3. Eligible applicants.  Eligible applicants for the New York state
innovation venture capital fund may include business enterprises in  the
formative  stage of development, regional and local economic development
organizations, technology development organizations, research  universi-
ties,  and  investment  funds  that  make  seed, early-stage and venture
investments. In order to be eligible for funds from the New  York  state
innovation  venture capital fund, a beneficiary company must: (a) be, or
agree in writing to be, located in New York state; (b) be in  the  seed,
early-stage  or  venture  stage of development, as defined by the corpo-
ration; and (c) have  the  potential  to  generate  additional  economic
activity in New York State.
  S  4.  Investment professionals.  The New York state urban development
corporation shall have the power to engage or retain the services of one
or more investment professionals or firms, through  direct  hire  or  by
contract  after  a competitive solicitation or otherwise as permitted by
law, with demonstrated knowledge and expertise to advise the corporation
with respect to the innovation venture capital fund and to provide  such
other investment advisory services as may be necessary or advisable.
  S  5.  Evaluation of applicants.  The New York state urban development
corporation shall establish a process by  rule  or  regulation  for  the
evaluation  of  applicants  for funds from the New York state innovation
venture capital fund; provided however that the  corporation  shall  not
issue  such  rules  or regulations pursuant to the emergency rule making
authority provided for in the state administrative procedure act.
  S 6. Report.  The New York state urban development  corporation  shall
submit  a report annually on December 31 to the director of the division
of the budget, the temporary president of the senate, the speaker of the
assembly, the minority leader of the senate and the minority  leader  of
the  assembly detailing: (a) the total amount of funds committed to each
applicant that receives funds and, if applicable,  the  amount  of  such
funds  that  has been invested by each such applicant; (b) the amount of
New York State innovation venture capital funds invested and the recipi-
ents of such funds; (c) the location of each  beneficiary  company;  (d)
the  number  of  jobs  projected to be created or retained; and (e) such
other information as the corporation deems necessary.
  S 7. Rules and regulations.   The New  York  state  urban  development
corporation  is hereby authorized to promulgate rules and regulations in
accordance with the state administrative procedure act as are  necessary
to  fulfill  the purposes of this act, including with respect to reason-
able management fees, promotes, share  of  return  and  other  fees  and
charges  of applicants that receive funds, and to provide for the repay-
ment of funds received by the beneficiary  company  if  the  beneficiary
company  leaves New York state within a period of time to be established
by the corporation. In accordance with such rules and  regulations,  the

S. 2609--D                         102                        A. 3009--D

corporation  may  impose fees, establish repayment terms and provide for
equity participation by the corporation in connection  with  investments
from the New York state innovation venture capital fund. Provided howev-
er that no rules or regulations issued pursuant to this section shall be
issued utilizing the emergency rule making authority provided for in the
state administrative procedure act.
  S 8. This act shall take effect immediately.
  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 3. This act shall take effect immediately  provided,  however,  that
the applicable effective date of Parts A through JJ of this act shall be
as specifically set forth in the last section of such Parts.