senate Bill S4523B

2013-2014 Legislative Session

Creates the broadband internet access act of 2014

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Archive: Last Bill Status - In Committee


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

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Assembly Actions - Lowercase
Senate Actions - UPPERCASE
Feb 03, 2014 print number 4523b
amend and recommit to infrastructure and capital investment
Jan 08, 2014 referred to infrastructure and capital investment
Jun 11, 2013 print number 4523a
amend and recommit to infrastructure and capital investment
Apr 08, 2013 referred to infrastructure and capital investment

Bill Amendments

Original
A
B (Active)
Original
A
B (Active)

S4523 - Bill Details

See Assembly Version of this Bill:
A9905
Current Committee:
Law Section:
Tax Law
Laws Affected:
Add §41, Tax L

S4523 - Bill Texts

view summary

Creates the broadband internet access act of 2014; provides a tax credit for the delivery of current generation broadband and next generation broadband.

view sponsor memo
BILL NUMBER:S4523

TITLE OF BILL: An act to amend the tax law, in relation to creating a
tax credit for people who deliver broadband services to a target group
of subscribers; and providing for the repeal of such provisions upon
expiration thereof

PURPOSE OR GENERAL IDEA OF BILL: This bill establishes the "Broadband
Internet Access Act of 2013," to provide incentives to ensure that all
citizens of New York State have the ability to gain timely and
equitable access to the internet over current and future generations
of broadband capability. This legislation will accelerate deployment
of current generation broadband access for users located in certain
low income and rural areas and to accelerate deployment of next
generation broadband.

SUMMARY OF SPECIFIC PROVISIONS: Section 1 establishes the Broadband
Internet Access Act of 2013.

Section 2 provides legislative intent. The Legislature recognizes the
vital importance of high-speed communications to the economic
competitiveness of New York State.It is the intent of the Legislature
to encourage extension of broadband accessibility to rural and
underserved areas across New York State.

Section 3 adds a new section 38 to the tax law creating the Broadband
Development Tax Credit to telecommunication providers for qualified
expenses relating to current generation broadband and next generation
broadband,. The current generation broadband tax credit will be equal
to 10% of the qualified expenditures incurred with respect to
qualified equipment of telecommunications provider delivering current
generation broadband services to rural subscribers or underserved
subscribers. The next generation broadband credit will be equal to 20%
of the qualified expenditures providers delivering next generation
broadband services to all underserved subscribers or any other
residential subscriber.

Qualified expenditures with respect to qualified equipment shall be
taken into account with respect. to the first year in which current
generation broadband services are delivered through such equipment to
rural or underserved subscribers, or next generation broadband
services are delivered through such equipment to rural subscribers,
underserved subscribers, or any other residential subscribers.

The delivery of current generation broadband services or next
generation broadband services through qualified equipment occurs when
such class of service is purchased by and provided to at least 10% of
all rural subscribers, underserved subscribers, or any other
residential subscriber.

To determine the current generation broadband credit the qualified
expenditure shall be multiplied by a fraction, the numerator of which
is the sum of the total potential subscriber populations within the
rural area and the underserved areas and the denominator is the total
potential subscriber population of the area the equipment is capable
of serving.


To determine the next generation broadband credit the qualified
expenditures must be multiplied by a fraction equal to the numerator
being the sum of the potential subscriber populations within the rural
areas and underserved areas, plus the total potential subscriber
population of the area consisting only of residential subscribers and
the denominator of which is the total potential subscriber population
of the area which the equipment is capable of serving. The credit will
be available regardless of the technology employed.

The annual fiscal impact of the Broadband Development Tax Credit shall
not exceed $100 million.

Section 4 is the effective date of 90 days after becoming law, to
expire on March 31, 2017.

JUSTIFICATION: Encouraging rapid development of broadband
infrastructure and ensuring the ubiquitous availability of current.
and next generation broadband capacity, is an urgent. priority of New
York State. Increasing the speed at which New Yorkers can access the
Internet. is necessary to ensure the economic expansion of the state.
End users from all parts of the state - including urban, rural and low
income areas should be afforded a choice and an opportunity to be
connected to the highest technology we have available. Many parts of
the State do not have access to the Internet thus depriving our
children and their families the ability to move forward into the new
economy. By encouraging expansion of the broadband infrastructure in
New York State we can make sure that rural, underserved or low-income
residents can have the same access as everyone in the state. This
legislation will ensure the families and children of this state will
not be left behind and will create equal access to the Internet among
all New Yorkers.

PRIOR LEGISLATIVE HISTORY: New Bill.

FISCAL IMPLICATIONS: The fiscal impact to the state will not exceed
$100 million per year for four years.

EFFECTIVE DATE: 90 days after enactment, with a sunset date of March
31, 2017.

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

                                  4523

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                              April 8, 2013
                               ___________

Introduced  by  Sen. TKACZYK -- read twice and ordered printed, and when
  printed to be committed to the Committee on Infrastructure and Capital
  Investment

AN ACT to amend the tax law, in relation to creating a  tax  credit  for
  people  who  deliver broadband services to a target group of subscrib-
  ers; and providing for the repeal of such provisions  upon  expiration
  thereof

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

  Section 1. This act shall be known and may be cited as the  "Broadband
Internet Access Act of 2013".
  S  2. Legislative intent.  The telecommunications revolution is trans-
forming virtually every  aspect  of  American  life.  Encouraging  rapid
development  of  broadband  infrastructure,  and ensuring the ubiquitous
availability of current and next generation broadband  capacity,  is  an
urgent priority of the legislature. Increasing the speed at which Ameri-
cans  can access the internet is necessary to ensure the economic expan-
sion of the state of New York. End users from all parts  of  the  state,
including urban, rural and low income areas, should be afforded a choice
among  carriers,  high-speed  access  to  a wide array of audio and data
applications, and the opportunity to take  advantage  of  the  prospects
created  by the deployment and use of current and next generation broad-
band facilities.  Accordingly, it is appropriate for the legislature  to
take  action to accelerate the deployment of current and next generation
broadband capability in the state of New York.
  S 3. The tax law is amended by adding a new  section  38  to  read  as
follows:
  S  38. BROADBAND DEVELOPMENT TAX CREDIT.  (A) A PROVIDER OF TELECOMMU-
NICATIONS SERVICES, WHO IS SUBJECT TO TAXATION  UNDER  ARTICLE  NINE  OF
THIS  CHAPTER,  SHALL  BE  ALLOWED A CREDIT AGAINST THE TAXES IMPOSED BY
SUCH ARTICLE. SUCH CREDIT SHALL BE DETERMINED AS FOLLOWS:

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD09969-03-3

S. 4523                             2

  (1) A PROVIDER SHALL BE ALLOWED A CURRENT GENERATION BROADBAND  CREDIT
EQUAL TO TEN PERCENT OF THE QUALIFIED EXPENDITURES INCURRED WITH RESPECT
TO  QUALIFIED  EQUIPMENT  OF  A  TELECOMMUNICATIONS  PROVIDER DELIVERING
CURRENT GENERATION BROADBAND SERVICES TO  RURAL  SUBSCRIBERS  OR  UNDER-
SERVED  SUBSCRIBERS.    SUCH CREDIT SHALL ONLY APPLY TO THAT PART OF THE
SERVICE BUILT:
  (A) FROM THE NODE TO THE HOME;
  (B) FROM THE "POINT OF PRESENCE" TO THE HOME; OR
  (C) FROM THE CENTRAL OFFICE TO THE HOME.
  (2) A PROVIDER SHALL BE ALLOWED A  NEXT  GENERATION  BROADBAND  CREDIT
EQUAL  TO  TWENTY  PERCENT  OF  THE QUALIFIED EXPENDITURES INCURRED WITH
RESPECT TO QUALIFIED EQUIPMENT OF A TELECOMMUNICATIONS PROVIDER DELIVER-
ING NEXT GENERATION BROADBAND SERVICES TO RURAL SUBSCRIBERS, UNDERSERVED
SUBSCRIBERS, OR ANY RESIDENTIAL SUBSCRIBER.    SUCH  CREDIT  SHALL  ONLY
APPLY TO THAT SERVICE BUILT:
  (A) FROM THE NODE TO THE HOME;
  (B) FROM THE "POINT OF PRESENCE" TO THE HOME; OR
  (C) FROM THE CENTRAL OFFICE TO THE HOME.
  (B)(1) A TELECOMMUNICATIONS SERVICES PROVIDER SHALL BE ALLOWED TO TAKE
THE  CREDIT PROVIDED FOR IN SUBDIVISION (A) OF THIS SECTION IN THE FIRST
TAXABLE YEAR IN WHICH:
  (A) CURRENT GENERATION BROADBAND SERVICES ARE DELIVERED  THROUGH  SUCH
EQUIPMENT TO RURAL SUBSCRIBERS OR UNDERSERVED SUBSCRIBERS; OR
  (B)  NEXT  GENERATION  BROADBAND  SERVICES  ARE DELIVERED THROUGH SUCH
EQUIPMENT TO RURAL SUBSCRIBERS, UNDERSERVED SUBSCRIBERS,  OR  ANY  OTHER
RESIDENTIAL SUBSCRIBERS.
  (2)  FOR  PURPOSES OF THIS SUBDIVISION, THE DELIVERY OF CURRENT GENER-
ATION BROADBAND SERVICES OR NEXT GENERATION BROADBAND  SERVICES  THROUGH
QUALIFIED  EQUIPMENT  OCCURS  WHEN SUCH CLASS OF SERVICE IS PURCHASED BY
AND PROVIDED TO AT LEAST TEN PERCENT OF  THE  SUBSCRIBERS  DESCRIBED  IN
THIS  SUBDIVISION,  WHERE  SUCH  EQUIPMENT  IS  CAPABLE  OF SERVING SUCH
SUBSCRIBERS THROUGH THE LEGAL OR CONTRACTUAL AREA ACCESS RIGHTS OR OBLI-
GATIONS OF THE PROVIDER.
  (C)(1) FOR PURPOSES OF DETERMINING THE  CURRENT  GENERATION  BROADBAND
CREDIT  UNDER  SUBDIVISION (A) OF THIS SECTION WITH RESPECT TO QUALIFIED
EQUIPMENT THROUGH WHICH CURRENT GENERATION BROADBAND SERVICES ARE DELIV-
ERED, IF  THE  QUALIFIED  EQUIPMENT  IS  CAPABLE  OF  SERVING  BOTH  THE
SUBSCRIBERS  DESCRIBED  UNDER  PARAGRAPH  ONE OF SUBDIVISION (A) OF THIS
SECTION AND OTHER  SUBSCRIBERS,  THE  QUALIFIED  EXPENDITURES  SHALL  BE
MULTIPLIED BY A FRACTION:
  (A) THE NUMERATOR OF WHICH IS THE SUM OF THE TOTAL POTENTIAL SUBSCRIB-
ER POPULATIONS WITHIN THE RURAL AREAS AND THE UNDERSERVED AREAS THAT THE
EQUIPMENT  IS  CAPABLE  OF  SERVING  WITH  CURRENT  GENERATION BROADBAND
SERVICES; AND
  (B) THE DENOMINATOR OF WHICH IS THE TOTAL POTENTIAL  SUBSCRIBER  POPU-
LATION OF THE AREA THAT THE EQUIPMENT IS CAPABLE OF SERVING WITH CURRENT
GENERATION BROADBAND SERVICES.
  (2)  FOR  PURPOSES OF DETERMINING THE NEXT GENERATION BROADBAND CREDIT
UNDER SUBDIVISION (A) OF THIS SECTION WITH RESPECT TO  QUALIFIED  EQUIP-
MENT  THROUGH WHICH NEXT GENERATION BROADBAND SERVICES ARE DELIVERED, IF
THE QUALIFIED EQUIPMENT IS  CAPABLE  OF  SERVING  BOTH  THE  SUBSCRIBERS
DESCRIBED  UNDER  PARAGRAPH  TWO  OF SUBDIVISION (A) OF THIS SECTION AND
OTHER SUBSCRIBERS, THE QUALIFIED EXPENDITURES SHALL BE MULTIPLIED  BY  A
FRACTION:
  (A)  THE  NUMERATOR  OF  WHICH  IS THE SUM OF: (I) THE TOTAL POTENTIAL
SUBSCRIBER POPULATIONS WITHIN THE RURAL AREAS AND THE UNDERSERVED  AREAS

S. 4523                             3

THAT  THE EQUIPMENT IS CAPABLE OF SERVING WITH NEXT GENERATION BROADBAND
SERVICES AND (II) THE TOTAL POTENTIAL SUBSCRIBER POPULATION OF THE  AREA
CONSISTING  ONLY  OF RESIDENTIAL SUBSCRIBERS NOT DESCRIBED IN CLAUSE (I)
OF  THIS SUBPARAGRAPH THAT THE EQUIPMENT IS CAPABLE OF SERVING WITH NEXT
GENERATION BROADBAND SERVICES; AND
  (B) THE DENOMINATOR OF WHICH IS THE TOTAL POTENTIAL  SUBSCRIBER  POPU-
LATION  OF  THE  AREA THAT THE EQUIPMENT IS CAPABLE OF SERVING WITH NEXT
GENERATION BROADBAND SERVICES.
  (D) FOR PURPOSES OF THIS SECTION, THE FOLLOWING WORDS SHALL  HAVE  THE
FOLLOWING MEANINGS:
  (1) "CURRENT GENERATION BROADBAND SERVICE" SHALL MEAN THE TRANSMISSION
OF  SIGNALS  AT  A  RATE  OF AT LEAST TEN MILLION BITS PER SECOND TO THE
SUBSCRIBER AND AT LEAST ONE MILLION BITS PER SECOND FROM THE SUBSCRIBER.
  (2) "NEXT GENERATION BROADBAND SERVICE" SHALL MEAN THE TRANSMISSION OF
SIGNALS AT A RATE OF AT LEAST TWENTY MILLION  BITS  PER  SECOND  TO  THE
SUBSCRIBER  AND AT LEAST FIVE MILLION BITS PER SECOND FROM THE SUBSCRIB-
ER.
  (3) "NONRESIDENTIAL SUBSCRIBER" SHALL  MEAN  A  PERSON  WHO  PURCHASES
BROADBAND  SERVICES  WHICH ARE DELIVERED TO THE PERMANENT PLACE OF BUSI-
NESS OF SUCH PERSON.
  (4) "PERSON" SHALL MEAN AN INDIVIDUAL, CORPORATION, PARTNERSHIP, ASSO-
CIATION, GOVERNMENTAL ENTITY, OR ANY OTHER LEGAL ENTITY.
  (5) "QUALIFIED EQUIPMENT" SHALL MEAN THE EQUIPMENT OF  A  TELECOMMUNI-
CATIONS  PROVIDER THAT IS CAPABLE OF PROVIDING CURRENT GENERATION BROAD-
BAND SERVICES OR NEXT GENERATION BROADBAND SERVICES  AT  ANY  TIME,  AND
WITHOUT  REGARD  TO ANY PARTICULAR TRANSMISSION MEDIUM OR TECHNOLOGY, TO
EACH SUBSCRIBER WHO IS UTILIZING SUCH SERVICES.
  (6) "QUALIFIED EXPENDITURE" SHALL MEAN ANY AMOUNT CHARGEABLE TO  CAPI-
TAL  ACCOUNT  WITH RESPECT TO THE PURCHASE AND INSTALLATION OF QUALIFIED
EQUIPMENT (INCLUDING ANY UPGRADES THERETO).
  (7) "RESIDENTIAL SUBSCRIBER" SHALL MEAN AN  INDIVIDUAL  WHO  PURCHASES
BROADBAND SERVICES WHICH ARE DELIVERED TO SUCH INDIVIDUAL'S DWELLING.
  (8) "RURAL AREA" SHALL MEAN ANY CENSUS TRACT WHICH:
  (A)  IS  NOT WITHIN TEN MILES OF ANY INCORPORATED OR CENSUS DESIGNATED
PLACE CONTAINING MORE THAN SEVENTY THOUSAND PEOPLE, AND
  (B) IS NOT WITHIN A COUNTY OR COUNTY EQUIVALENT WHICH HAS  AN  OVERALL
POPULATION  DENSITY OF MORE THAN EIGHT HUNDRED PEOPLE PER SQUARE MILE OF
LAND.
  (9) "RURAL SUBSCRIBER" SHALL MEAN A RESIDENTIAL SUBSCRIBER RESIDING IN
A DWELLING LOCATED IN A RURAL AREA OR  NONRESIDENTIAL  SUBSCRIBER  MAIN-
TAINING A PERMANENT PLACE OF BUSINESS LOCATED IN A RURAL AREA.
  (10)  "SUBSCRIBER"  SHALL  MEAN  A  PERSON  WHO  PURCHASES OR RECEIVES
CURRENT GENERATION  BROADBAND  SERVICES  OR  NEXT  GENERATION  BROADBAND
SERVICES.
  (11)  "TELECOMMUNICATIONS PROVIDER" OR "PROVIDER" SHALL MEAN A PERSON,
OR AN AFFILIATE OF SUCH PERSON, EITHER OF WHICH FOR COMPENSATION DEPLOYS
FACILITIES USED DIRECTLY OR INDIRECTLY IN THE PROVISIONS OF  INTRASTATE,
INTERSTATE  OR  INTERNATIONAL  TELECOMMUNICATIONS,  WHETHER  ON A COMMON
CARRIAGE, PRIVATE CARRIAGE, WHOLESALE, OR RETAIL BASIS.
  (12) "TOTAL POTENTIAL SUBSCRIBER POPULATION" SHALL MEAN, WITH  RESPECT
TO  ANY  AREA AND BASED ON THE MOST RECENT CENSUS DATA, THE TOTAL NUMBER
OF POTENTIAL RESIDENTIAL SUBSCRIBERS RESIDING IN  DWELLINGS  LOCATED  IN
SUCH AREA AND POTENTIAL NONRESIDENTIAL SUBSCRIBERS MAINTAINING PERMANENT
PLACES OF BUSINESS LOCATED IN SUCH AREA.
  (13)  "UNDERSERVED  AREA" SHALL MEAN ANY CENSUS TRACT WHICH IS LOCATED
IN:

S. 4523                             4

  (A) AN EMPOWERMENT  ZONE  OR  ENTERPRISE  COMMUNITY  DESIGNATED  UNDER
SECTION 1391 OF THE UNITED STATES INTERNAL REVENUE CODE OF 1986;
  (B)  A  RENEWAL COMMUNITY DESIGNATED UNDER SECTION 1400E OF THE UNITED
STATES INTERNAL REVENUE CODE OF 1986; OR
  (C) A LOW-INCOME COMMUNITY DESIGNATED UNDER SECTION 45D OF THE  UNITED
STATES INTERNAL REVENUE CODE OF 1986.
  (14)  "UNDERSERVED  SUBSCRIBER"  SHALL  MEAN  A RESIDENTIAL SUBSCRIBER
RESIDING IN A DWELLING LOCATED IN AN UNDERSERVED AREA OR  NONRESIDENTIAL
SUBSCRIBER  MAINTAINING  A  PERMANENT  PLACE  OF  BUSINESS LOCATED IN AN
UNDERSERVED AREA.
  (15) "NODE" SHALL MEAN THE  CABINET  AND  EQUIPMENT,  INCLUDING  POWER
SUPPLY,  FANS,  GAS  GENERATORS,  BATTERIES  AND  OPTICAL  TO ELECTRICAL
CONVERTERS, LOCATED IN THE NEIGHBORHOODS WHICH SERVE HOMES,  BUSINESSES,
AND  INSTITUTIONS,  AND  WHICH  IS  THE POINT WHERE FIBER FACILITIES AND
COAXIAL FACILITIES ARE CONNECTED.
  (16) "POINT OF PRESENCE" SHALL MEAN THE  SPECIFIC  LOCATION  WITHIN  A
LOCAL  ACCESS  TRANSPORT  AREA WHERE A CONNECTION TO THE INTERNET TERMI-
NATES AND/OR ORIGINATES ITS SERVICE, AND SUCH PHYSICAL  LOCATION  HOUSES
SERVERS,  ROUTERS,  ATM  SWITCHES, AND OTHER DEVICES BY WHICH A COMMUNI-
CATIONS CARRIER ALLOWS OTHER CARRIERS TO ACCESS ITS NETWORK.
  (17) "CENTRAL OFFICE" SHALL MEAN AN OFFICE  IN  A  LOCALITY  TO  WHICH
SUBSCRIBER  HOME  AND  BUSINESS  LINES ARE CONNECTED ON WHAT IS CALLED A
LOCAL LOOP, CONTAINING SWITCHING EQUIPMENT THAT CAN SWITCH CALLS LOCALLY
OR TO LONG-DISTANCE CARRIER PHONE OFFICES.
  (E) THE TOTAL FISCAL IMPACT OF THE  RURAL  BROADBAND  DEVELOPMENT  TAX
CREDIT SHALL NOT EXCEED ONE HUNDRED MILLION DOLLARS EACH YEAR.
  S  4.  This  act shall take effect on the ninetieth day after it shall
have become a law and shall expire and  be  deemed  repealed  March  31,
2017.

S4523A - Bill Details

See Assembly Version of this Bill:
A9905
Current Committee:
Law Section:
Tax Law
Laws Affected:
Add §41, Tax L

S4523A - Bill Texts

view summary

Creates the broadband internet access act of 2014; provides a tax credit for the delivery of current generation broadband and next generation broadband.

view sponsor memo
BILL NUMBER:S4523A

TITLE OF BILL: An act to amend the tax law, in relation to creating a
tax credit for people who deliver broadband services to a target group
of subscribers; and providing for the repeal of such provisions upon
expiration thereof

PURPOSE OR GENERAL IDEA OF BILL:

This bill establishes the "Broadband Internet Access Act of 2013," to
provide incentives to ensure that all citizens of New York State have
the ability to gain timely and equitable access to the internet over
current and future generations of broadband capability. This
legislation will accelerate deployment of current generation broadband
access for users located in certain low income and rural areas and to
accelerate deployment of next generation broadband.

SUMMARY OF SPECIFIC PROVISIONS:

Section 1 establishes the Broadband Internet Access Act of 2013.

Section 2 provides legislative intent. The Legislature recognizes the
vital importance of high-speed communications to the economic
competitiveness of New York State.It is the intent of the Legislature
to encourage extension of broadband accessibility to rural and
underserved areas across New York State.

Section 3 adds a new section 39 to the tax law creating the Broadband
Development Tax Credit to telecommunication providers for qualified
expenses relating to current generation broadband and next generation
broadband,. The current generation broadband tax credit will be equal
to 10% of the qualified expenditures incurred with respect to
qualified equipment of telecommunications provider delivering current
generation broadband services to rural subscribers or underserved
subscribers. The next generation broadband credit will be equal to 20%
of the qualified expenditures providers delivering next generation
broadband services to all underserved subscribers or any other
residential subscriber.

Qualified expenditures with respect to qualified equipment shall be
taken into account with respect. to the first year in which current
generation broadband services are delivered through such equipment to
rural or underserved subscribers, or next generation broadband
services are delivered through such equipment to rural subscribers,
underserved subscribers, or any other residential subscribers. The
delivery of current generation broadband services or next generation
broadband services through qualified equipment occurs when such class
of service is purchased by and provided to at least 10% of all rural
subscribers, underserved subscribers, or any other residential
subscriber.

To determine the current generation broadband credit the qualified
expenditure shall be multiplied by a fraction, the numerator of which
is the sum of the total potential subscriber populations within the
rural area and the underserved areas and the denominator is the total
potential subscriber population of the area the equipment is capable
of serving.


To determine the next generation broadband credit the qualified
expenditures must be multiplied by a fraction equal to the numerator
being the sum of the potential subscriber populations within the rural
areas and underserved areas, plus the total potential subscriber
population of the area consisting only of residential subscribers and
the denominator of which is the total potential subscriber population
of the area which the equipment is capable of serving. The credit will
be available regardless of the technology employed.

The annual fiscal impact of the Broadband Development Tax Credit shall
not exceed $100 million.

Section 4 is the effective date of 90 days after becoming law, to
expire on March 31, 2017.

JUSTIFICATION:

Encouraging rapid development of broadband infrastructure and ensuring
the ubiquitous availability of current. and next generation broadband
capacity, is an urgent. priority of New York State. Increasing the
speed at which New Yorkers can access the Internet, is necessary to
ensure the economic expansion of the state. End users from all parts
of the state - including urban, rural and low income areas should be
afforded a choice and an opportunity to be connected to the highest
technology we have available. Many parts of the State do not have
access to the Internet thus depriving our children and their families
the ability to move forward into the new economy. By encouraging
expansion of the broadband infrastructure in New York State we can
make sure that rural, underserved or low-income residents can have the
same access as everyone in the state. This legislation will ensure the
families and children of this state will not be left behind and will
create equal access to the Internet among all New Yorkers.

PRIOR LEGISLATIVE HISTORY:

New Bill.

FISCAL IMPLICATIONS:

The fiscal impact to the state will not exceed $100 million per year
for four years.

EFFECTIVE DATE:

90 days after enactment, with a sunset date of March 31, 2017.

view full text
download pdf
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                 4523--A

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                              April 8, 2013
                               ___________

Introduced  by  Sen. TKACZYK -- read twice and ordered printed, and when
  printed to be committed to the Committee on Infrastructure and Capital
  Investment -- committee discharged, bill amended, ordered reprinted as
  amended and recommitted to said committee

AN ACT to amend the tax law, in relation to creating a  tax  credit  for
  people  who  deliver broadband services to a target group of subscrib-
  ers; and providing for the repeal of such provisions  upon  expiration
  thereof

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

  Section 1. This act shall be known and may be cited as the  "Broadband
Internet Access Act of 2013".
  S  2. Legislative intent.  The telecommunications revolution is trans-
forming virtually every  aspect  of  American  life.  Encouraging  rapid
development  of  broadband  infrastructure,  and ensuring the ubiquitous
availability of current and next generation broadband  capacity,  is  an
urgent priority of the legislature. Increasing the speed at which Ameri-
cans  can access the internet is necessary to ensure the economic expan-
sion of the state of New York. End users from all parts  of  the  state,
including urban, rural and low income areas, should be afforded a choice
among  carriers,  high-speed  access  to  a wide array of audio and data
applications, and the opportunity to take  advantage  of  the  prospects
created  by the deployment and use of current and next generation broad-
band facilities.  Accordingly, it is appropriate for the legislature  to
take  action to accelerate the deployment of current and next generation
broadband capability in the state of New York.
  S 3. The tax law is amended by adding a new  section  39  to  read  as
follows:
  S  39. BROADBAND DEVELOPMENT TAX CREDIT.  (A) A PROVIDER OF TELECOMMU-
NICATIONS SERVICES, WHO IS SUBJECT TO TAXATION  UNDER  ARTICLE  NINE  OF

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD09969-04-3

S. 4523--A                          2

THIS  CHAPTER,  SHALL  BE  ALLOWED A CREDIT AGAINST THE TAXES IMPOSED BY
SUCH ARTICLE. SUCH CREDIT SHALL BE DETERMINED AS FOLLOWS:
  (1)  A PROVIDER SHALL BE ALLOWED A CURRENT GENERATION BROADBAND CREDIT
EQUAL TO TEN PERCENT OF THE QUALIFIED EXPENDITURES INCURRED WITH RESPECT
TO QUALIFIED  EQUIPMENT  OF  A  TELECOMMUNICATIONS  PROVIDER  DELIVERING
CURRENT  GENERATION  BROADBAND  SERVICES  TO RURAL SUBSCRIBERS OR UNDER-
SERVED SUBSCRIBERS.  SUCH CREDIT SHALL ONLY APPLY TO THAT  PART  OF  THE
SERVICE BUILT:
  (A) FROM THE NODE TO THE HOME;
  (B) FROM THE "POINT OF PRESENCE" TO THE HOME; OR
  (C) FROM THE CENTRAL OFFICE TO THE HOME.
  (2)  A  PROVIDER  SHALL  BE ALLOWED A NEXT GENERATION BROADBAND CREDIT
EQUAL TO TWENTY PERCENT OF  THE  QUALIFIED  EXPENDITURES  INCURRED  WITH
RESPECT TO QUALIFIED EQUIPMENT OF A TELECOMMUNICATIONS PROVIDER DELIVER-
ING NEXT GENERATION BROADBAND SERVICES TO RURAL SUBSCRIBERS, UNDERSERVED
SUBSCRIBERS,  OR  ANY  RESIDENTIAL  SUBSCRIBER.   SUCH CREDIT SHALL ONLY
APPLY TO THAT SERVICE BUILT:
  (A) FROM THE NODE TO THE HOME;
  (B) FROM THE "POINT OF PRESENCE" TO THE HOME; OR
  (C) FROM THE CENTRAL OFFICE TO THE HOME.
  (B)(1) A TELECOMMUNICATIONS SERVICES PROVIDER SHALL BE ALLOWED TO TAKE
THE CREDIT PROVIDED FOR IN SUBDIVISION (A) OF THIS SECTION IN THE  FIRST
TAXABLE YEAR IN WHICH:
  (A)  CURRENT  GENERATION BROADBAND SERVICES ARE DELIVERED THROUGH SUCH
EQUIPMENT TO RURAL SUBSCRIBERS OR UNDERSERVED SUBSCRIBERS; OR
  (B) NEXT GENERATION BROADBAND  SERVICES  ARE  DELIVERED  THROUGH  SUCH
EQUIPMENT  TO  RURAL  SUBSCRIBERS, UNDERSERVED SUBSCRIBERS, OR ANY OTHER
RESIDENTIAL SUBSCRIBERS.
  (2) FOR PURPOSES OF THIS SUBDIVISION, THE DELIVERY OF  CURRENT  GENER-
ATION  BROADBAND  SERVICES OR NEXT GENERATION BROADBAND SERVICES THROUGH
QUALIFIED EQUIPMENT OCCURS WHEN SUCH CLASS OF SERVICE  IS  PURCHASED  BY
AND  PROVIDED  TO  AT  LEAST TEN PERCENT OF THE SUBSCRIBERS DESCRIBED IN
THIS SUBDIVISION, WHERE  SUCH  EQUIPMENT  IS  CAPABLE  OF  SERVING  SUCH
SUBSCRIBERS THROUGH THE LEGAL OR CONTRACTUAL AREA ACCESS RIGHTS OR OBLI-
GATIONS OF THE PROVIDER.
  (C)(1)  FOR  PURPOSES  OF DETERMINING THE CURRENT GENERATION BROADBAND
CREDIT UNDER SUBDIVISION (A) OF THIS SECTION WITH RESPECT  TO  QUALIFIED
EQUIPMENT THROUGH WHICH CURRENT GENERATION BROADBAND SERVICES ARE DELIV-
ERED,  IF  THE  QUALIFIED  EQUIPMENT  IS  CAPABLE  OF  SERVING  BOTH THE
SUBSCRIBERS DESCRIBED UNDER PARAGRAPH ONE OF  SUBDIVISION  (A)  OF  THIS
SECTION  AND  OTHER  SUBSCRIBERS,  THE  QUALIFIED  EXPENDITURES SHALL BE
MULTIPLIED BY A FRACTION:
  (A) THE NUMERATOR OF WHICH IS THE SUM OF THE TOTAL POTENTIAL SUBSCRIB-
ER POPULATIONS WITHIN THE RURAL AREAS AND THE UNDERSERVED AREAS THAT THE
EQUIPMENT IS  CAPABLE  OF  SERVING  WITH  CURRENT  GENERATION  BROADBAND
SERVICES; AND
  (B)  THE  DENOMINATOR OF WHICH IS THE TOTAL POTENTIAL SUBSCRIBER POPU-
LATION OF THE AREA THAT THE EQUIPMENT IS CAPABLE OF SERVING WITH CURRENT
GENERATION BROADBAND SERVICES.
  (2) FOR PURPOSES OF DETERMINING THE NEXT GENERATION  BROADBAND  CREDIT
UNDER  SUBDIVISION  (A) OF THIS SECTION WITH RESPECT TO QUALIFIED EQUIP-
MENT THROUGH WHICH NEXT GENERATION BROADBAND SERVICES ARE DELIVERED,  IF
THE  QUALIFIED  EQUIPMENT  IS  CAPABLE  OF  SERVING BOTH THE SUBSCRIBERS
DESCRIBED UNDER PARAGRAPH TWO OF SUBDIVISION (A)  OF  THIS  SECTION  AND
OTHER  SUBSCRIBERS,  THE QUALIFIED EXPENDITURES SHALL BE MULTIPLIED BY A
FRACTION:

S. 4523--A                          3

  (A) THE NUMERATOR OF WHICH IS THE SUM  OF:  (I)  THE  TOTAL  POTENTIAL
SUBSCRIBER  POPULATIONS WITHIN THE RURAL AREAS AND THE UNDERSERVED AREAS
THAT THE EQUIPMENT IS CAPABLE OF SERVING WITH NEXT GENERATION  BROADBAND
SERVICES  AND (II) THE TOTAL POTENTIAL SUBSCRIBER POPULATION OF THE AREA
CONSISTING  ONLY  OF RESIDENTIAL SUBSCRIBERS NOT DESCRIBED IN CLAUSE (I)
OF THIS SUBPARAGRAPH THAT THE EQUIPMENT IS CAPABLE OF SERVING WITH  NEXT
GENERATION BROADBAND SERVICES; AND
  (B)  THE  DENOMINATOR OF WHICH IS THE TOTAL POTENTIAL SUBSCRIBER POPU-
LATION OF THE AREA THAT THE EQUIPMENT IS CAPABLE OF  SERVING  WITH  NEXT
GENERATION BROADBAND SERVICES.
  (D)  FOR  PURPOSES OF THIS SECTION, THE FOLLOWING WORDS SHALL HAVE THE
FOLLOWING MEANINGS:
  (1) "CURRENT GENERATION BROADBAND SERVICE" SHALL MEAN THE TRANSMISSION
OF SIGNALS AT A RATE OF AT LEAST TEN MILLION  BITS  PER  SECOND  TO  THE
SUBSCRIBER AND AT LEAST ONE MILLION BITS PER SECOND FROM THE SUBSCRIBER.
  (2) "NEXT GENERATION BROADBAND SERVICE" SHALL MEAN THE TRANSMISSION OF
SIGNALS  AT  A  RATE  OF  AT LEAST TWENTY MILLION BITS PER SECOND TO THE
SUBSCRIBER AND AT LEAST FIVE MILLION BITS PER SECOND FROM THE  SUBSCRIB-
ER.
  (3)  "NONRESIDENTIAL  SUBSCRIBER"  SHALL  MEAN  A PERSON WHO PURCHASES
BROADBAND SERVICES WHICH ARE DELIVERED TO THE PERMANENT PLACE  OF  BUSI-
NESS OF SUCH PERSON.
  (4) "PERSON" SHALL MEAN AN INDIVIDUAL, CORPORATION, PARTNERSHIP, ASSO-
CIATION, GOVERNMENTAL ENTITY, OR ANY OTHER LEGAL ENTITY.
  (5)  "QUALIFIED  EQUIPMENT" SHALL MEAN THE EQUIPMENT OF A TELECOMMUNI-
CATIONS PROVIDER THAT IS CAPABLE OF PROVIDING CURRENT GENERATION  BROAD-
BAND  SERVICES  OR  NEXT  GENERATION BROADBAND SERVICES AT ANY TIME, AND
WITHOUT REGARD TO ANY PARTICULAR TRANSMISSION MEDIUM OR  TECHNOLOGY,  TO
EACH SUBSCRIBER WHO IS UTILIZING SUCH SERVICES.
  (6)  "QUALIFIED EXPENDITURE" SHALL MEAN ANY AMOUNT CHARGEABLE TO CAPI-
TAL ACCOUNT WITH RESPECT TO THE PURCHASE AND INSTALLATION  OF  QUALIFIED
EQUIPMENT (INCLUDING ANY UPGRADES THERETO).
  (7)  "RESIDENTIAL  SUBSCRIBER"  SHALL MEAN AN INDIVIDUAL WHO PURCHASES
BROADBAND SERVICES WHICH ARE DELIVERED TO SUCH INDIVIDUAL'S DWELLING.
  (8) "RURAL AREA" SHALL MEAN ANY CENSUS TRACT WHICH:
  (A) IS NOT WITHIN TEN MILES OF ANY INCORPORATED OR  CENSUS  DESIGNATED
PLACE CONTAINING MORE THAN SEVENTY THOUSAND PEOPLE, AND
  (B)  IS  NOT WITHIN A COUNTY OR COUNTY EQUIVALENT WHICH HAS AN OVERALL
POPULATION DENSITY OF MORE THAN EIGHT HUNDRED PEOPLE PER SQUARE MILE  OF
LAND.
  (9) "RURAL SUBSCRIBER" SHALL MEAN A RESIDENTIAL SUBSCRIBER RESIDING IN
A  DWELLING  LOCATED  IN A RURAL AREA OR NONRESIDENTIAL SUBSCRIBER MAIN-
TAINING A PERMANENT PLACE OF BUSINESS LOCATED IN A RURAL AREA.
  (10) "SUBSCRIBER" SHALL  MEAN  A  PERSON  WHO  PURCHASES  OR  RECEIVES
CURRENT  GENERATION  BROADBAND  SERVICES  OR  NEXT  GENERATION BROADBAND
SERVICES.
  (11) "TELECOMMUNICATIONS PROVIDER" OR "PROVIDER" SHALL MEAN A  PERSON,
OR AN AFFILIATE OF SUCH PERSON, EITHER OF WHICH FOR COMPENSATION DEPLOYS
FACILITIES  USED DIRECTLY OR INDIRECTLY IN THE PROVISIONS OF INTRASTATE,
INTERSTATE OR INTERNATIONAL  TELECOMMUNICATIONS,  WHETHER  ON  A  COMMON
CARRIAGE, PRIVATE CARRIAGE, WHOLESALE, OR RETAIL BASIS.
  (12)  "TOTAL POTENTIAL SUBSCRIBER POPULATION" SHALL MEAN, WITH RESPECT
TO ANY AREA AND BASED ON THE MOST RECENT CENSUS DATA, THE  TOTAL  NUMBER
OF  POTENTIAL  RESIDENTIAL  SUBSCRIBERS RESIDING IN DWELLINGS LOCATED IN
SUCH AREA AND POTENTIAL NONRESIDENTIAL SUBSCRIBERS MAINTAINING PERMANENT
PLACES OF BUSINESS LOCATED IN SUCH AREA.

S. 4523--A                          4

  (13) "UNDERSERVED AREA" SHALL MEAN ANY CENSUS TRACT WHICH  IS  LOCATED
IN:
  (A)  AN  EMPOWERMENT  ZONE  OR  ENTERPRISE  COMMUNITY DESIGNATED UNDER
SECTION 1391 OF THE UNITED STATES INTERNAL REVENUE CODE OF 1986;
  (B) A RENEWAL COMMUNITY DESIGNATED UNDER SECTION 1400E OF  THE  UNITED
STATES INTERNAL REVENUE CODE OF 1986; OR
  (C)  A LOW-INCOME COMMUNITY DESIGNATED UNDER SECTION 45D OF THE UNITED
STATES INTERNAL REVENUE CODE OF 1986.
  (14) "UNDERSERVED SUBSCRIBER"  SHALL  MEAN  A  RESIDENTIAL  SUBSCRIBER
RESIDING  IN A DWELLING LOCATED IN AN UNDERSERVED AREA OR NONRESIDENTIAL
SUBSCRIBER MAINTAINING A PERMANENT  PLACE  OF  BUSINESS  LOCATED  IN  AN
UNDERSERVED AREA.
  (15)  "NODE"  SHALL  MEAN  THE  CABINET AND EQUIPMENT, INCLUDING POWER
SUPPLY, FANS,  GAS  GENERATORS,  BATTERIES  AND  OPTICAL  TO  ELECTRICAL
CONVERTERS,  LOCATED IN THE NEIGHBORHOODS WHICH SERVE HOMES, BUSINESSES,
AND INSTITUTIONS, AND WHICH IS THE  POINT  WHERE  FIBER  FACILITIES  AND
COAXIAL FACILITIES ARE CONNECTED.
  (16)  "POINT  OF  PRESENCE"  SHALL MEAN THE SPECIFIC LOCATION WITHIN A
LOCAL ACCESS TRANSPORT AREA WHERE A CONNECTION TO  THE  INTERNET  TERMI-
NATES  AND/OR  ORIGINATES ITS SERVICE, AND SUCH PHYSICAL LOCATION HOUSES
SERVERS, ROUTERS, ATM SWITCHES, AND OTHER DEVICES BY  WHICH  A  COMMUNI-
CATIONS CARRIER ALLOWS OTHER CARRIERS TO ACCESS ITS NETWORK.
  (17)  "CENTRAL  OFFICE"  SHALL  MEAN  AN OFFICE IN A LOCALITY TO WHICH
SUBSCRIBER HOME AND BUSINESS LINES ARE CONNECTED ON  WHAT  IS  CALLED  A
LOCAL LOOP, CONTAINING SWITCHING EQUIPMENT THAT CAN SWITCH CALLS LOCALLY
OR TO LONG-DISTANCE CARRIER PHONE OFFICES.
  (E)  THE  TOTAL  FISCAL  IMPACT OF THE RURAL BROADBAND DEVELOPMENT TAX
CREDIT SHALL NOT EXCEED ONE HUNDRED MILLION DOLLARS EACH YEAR.
  S 4. This act shall take effect on the ninetieth day  after  it  shall
have  become  a  law  and  shall expire and be deemed repealed March 31,
2017.

S4523B (ACTIVE) - Bill Details

See Assembly Version of this Bill:
A9905
Current Committee:
Law Section:
Tax Law
Laws Affected:
Add §41, Tax L

S4523B (ACTIVE) - Bill Texts

view summary

Creates the broadband internet access act of 2014; provides a tax credit for the delivery of current generation broadband and next generation broadband.

view sponsor memo
BILL NUMBER:S4523B

TITLE OF BILL: An act to amend the tax law, in relation to creating a
tax credit for people who deliver broadband services to a target group
of subscribers; and providing for the repeal of such provisions upon
expiration thereof

PURPOSE OR GENERAL IDEA OF BILL: This bill establishes the "Broadband
Internet Access Act of 2014," to provide incentives to ensure that all
citizens of New York State have the ability to gain timely and
equitable access to the internet over current and future generations
of broadband capability. This legislation will accelerate deployment
of current generation broadband access for users located in certain
low income and rural areas and to accelerate deployment of next
generation broadband.

SUMMARY OF SPECIFIC PROVISIONS:

Section 1 establishes the Broadband Internet Access Act of 2014.

Section 2 provides legislative intent. The Legislature recognizes the
vital importance of high-speed communications to the economic
competitiveness of New York State. It is the intent of the Legislature
to encourage extension of broadband accessibility to rural and
underserved areas across New York State.

Section 3 adds a new section 41 to the tax law creating the Broadband
Development Tax Credit to telecommunication providers for qualified
expenses relating to current generation broadband and next generation
broadband. The current generation broadband tax credit will be equal
to 10% of the qualified expenditures incurred with respect to
qualified equipment of telecommunications provider delivering current
generation broadband services to rural subscribers or underserved
subscribers. The next generation broadband credit will be equal to 20%
of the qualified expenditures providers delivering next generation
broadband services to all underserved subscribers or any other
residential subscriber.

Qualified expenditures with respect to qualified equipment shall be
taken into account with respect to the first year in which current
generation broadband services are delivered through such equipment to
rural or underserved subscribers, or next generation broadband
services are delivered through such equipment to rural subscribers,
underserved subscribers, or any other residential subscribers. The
delivery of current generation broadband services or next generation
broadband services through qualified equipment occurs when such class
of service is purchased by and provided to at least 10% of all rural
subscribers, underserved subscribers, or any other residential
subscriber.

To determine the current generation broadband credit the qualified
expenditure shall be multiplied by a fraction, the numerator of which
is the sum of the total potential subscriber populations within the
rural area and the underserved areas and the denominator is the total
potential subscriber population of the area the equipment is capable
of serving.


To determine the next generation broadband credit the qualified
expenditures must be multiplied by a fraction equal to the numerator
being the sum of the potential subscriber populations within the rural
areas and underserved areas, plus the total potential subscriber
population of the area consisting only of residential subscribers and
the denominator of which is the total potential subscriber population
of the area which the equipment is capable of serving. The credit will
be available regardless of the technology employed.

The annual fiscal impact of the Broadband Development Tax Credit shall
not exceed $100 million.

Section 4 is the effective date of 90 days after becoming law, to
expire on March 31, 2018.

JUSTIFICATION: Encouraging rapid development of broadband
infrastructure and ensuring the ubiquitous availability of current and
next generation broadband capacity, is an urgent priority of New York
State. Increasing the speed at which New Yorkers can access the
Internet, is necessary to ensure the economic expansion of the state.
End users from all parts of the state including urban, rural and low
income areas should be afforded a choice and an opportunity to be
connected to the highest technology we have available. Many parts of
the State do not have access to the Internet thus depriving our
children and their families the ability to move forward into the new
economy. By encouraging expansion of the broadband infrastructure in
New York State we can make sure that rural, under-served or low-income
residents can have the same access as everyone in the state. This
legislation will ensure the families and children of this state will
not be left behind and will create equal access to the Internet among
all New Yorkers.

PRIOR LEGISLATIVE HISTORY: New Bill.

FISCAL IMPLICATIONS: The fiscal impact to the state will not exceed
$100 million per year for four years.

EFFECTIVE DATE: 90 days after enactment, with a sunset date of March
31, 2018.

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

                                 4523--B

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                              April 8, 2013
                               ___________

Introduced  by  Sen. TKACZYK -- read twice and ordered printed, and when
  printed to be committed to the Committee on Infrastructure and Capital
  Investment -- committee discharged, bill amended, ordered reprinted as
  amended and recommitted  to  said  committee  --  recommitted  to  the
  Committee  on Infrastructure and Capital Investment in accordance with
  Senate Rule 6, sec. 8 -- committee discharged, bill  amended,  ordered
  reprinted as amended and recommitted to said committee

AN  ACT  to  amend the tax law, in relation to creating a tax credit for
  people who deliver broadband services to a target group  of  subscrib-
  ers;  and  providing for the repeal of such provisions upon expiration
  thereof

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

  Section  1. This act shall be known and may be cited as the "Broadband
Internet Access Act of 2014".
  S 2. Legislative intent.  The telecommunications revolution is  trans-
forming  virtually  every  aspect  of  American  life. Encouraging rapid
development of broadband infrastructure,  and  ensuring  the  ubiquitous
availability  of  current  and next generation broadband capacity, is an
urgent priority of the legislature. Increasing the speed at which Ameri-
cans can access the internet is necessary to ensure the economic  expan-
sion  of  the  state of New York. End users from all parts of the state,
including urban, rural and low income areas, should be afforded a choice
among carriers, high-speed access to a wide  array  of  audio  and  data
applications,  and  the  opportunity  to take advantage of the prospects
created by the deployment and use of current and next generation  broad-
band  facilities.  Accordingly, it is appropriate for the legislature to
take action to accelerate the deployment of current and next  generation
broadband capability in the state of New York.
  S  3.  The  tax  law  is amended by adding a new section 41 to read as
follows:

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD09969-06-4

S. 4523--B                          2

  S 41. BROADBAND DEVELOPMENT TAX CREDIT.  (A) A PROVIDER OF  TELECOMMU-
NICATIONS  SERVICES,  WHO  IS  SUBJECT TO TAXATION UNDER ARTICLE NINE OF
THIS CHAPTER, SHALL BE ALLOWED A CREDIT AGAINST  THE  TAXES  IMPOSED  BY
SUCH ARTICLE. SUCH CREDIT SHALL BE DETERMINED AS FOLLOWS:
  (1)  A PROVIDER SHALL BE ALLOWED A CURRENT GENERATION BROADBAND CREDIT
EQUAL TO TEN PERCENT OF THE QUALIFIED EXPENDITURES INCURRED WITH RESPECT
TO QUALIFIED  EQUIPMENT  OF  A  TELECOMMUNICATIONS  PROVIDER  DELIVERING
CURRENT  GENERATION  BROADBAND  SERVICES  TO RURAL SUBSCRIBERS OR UNDER-
SERVED SUBSCRIBERS.  SUCH CREDIT SHALL ONLY APPLY TO THAT  PART  OF  THE
SERVICE BUILT:
  (A) FROM THE NODE TO THE HOME;
  (B) FROM THE "POINT OF PRESENCE" TO THE HOME; OR
  (C) FROM THE CENTRAL OFFICE TO THE HOME.
  (2)  A  PROVIDER  SHALL  BE ALLOWED A NEXT GENERATION BROADBAND CREDIT
EQUAL TO TWENTY PERCENT OF  THE  QUALIFIED  EXPENDITURES  INCURRED  WITH
RESPECT TO QUALIFIED EQUIPMENT OF A TELECOMMUNICATIONS PROVIDER DELIVER-
ING NEXT GENERATION BROADBAND SERVICES TO RURAL SUBSCRIBERS, UNDERSERVED
SUBSCRIBERS,  OR  ANY  RESIDENTIAL  SUBSCRIBER.   SUCH CREDIT SHALL ONLY
APPLY TO THAT SERVICE BUILT:
  (A) FROM THE NODE TO THE HOME;
  (B) FROM THE "POINT OF PRESENCE" TO THE HOME; OR
  (C) FROM THE CENTRAL OFFICE TO THE HOME.
  (B)(1) A TELECOMMUNICATIONS SERVICES PROVIDER SHALL BE ALLOWED TO TAKE
THE CREDIT PROVIDED FOR IN SUBDIVISION (A) OF THIS SECTION IN THE  FIRST
TAXABLE YEAR IN WHICH:
  (A)  CURRENT  GENERATION BROADBAND SERVICES ARE DELIVERED THROUGH SUCH
EQUIPMENT TO RURAL SUBSCRIBERS OR UNDERSERVED SUBSCRIBERS; OR
  (B) NEXT GENERATION BROADBAND  SERVICES  ARE  DELIVERED  THROUGH  SUCH
EQUIPMENT  TO  RURAL  SUBSCRIBERS, UNDERSERVED SUBSCRIBERS, OR ANY OTHER
RESIDENTIAL SUBSCRIBERS.
  (2) FOR PURPOSES OF THIS SUBDIVISION, THE DELIVERY OF  CURRENT  GENER-
ATION  BROADBAND  SERVICES OR NEXT GENERATION BROADBAND SERVICES THROUGH
QUALIFIED EQUIPMENT OCCURS WHEN SUCH CLASS OF SERVICE  IS  PURCHASED  BY
AND  PROVIDED  TO  AT  LEAST TEN PERCENT OF THE SUBSCRIBERS DESCRIBED IN
THIS SUBDIVISION, WHERE  SUCH  EQUIPMENT  IS  CAPABLE  OF  SERVING  SUCH
SUBSCRIBERS THROUGH THE LEGAL OR CONTRACTUAL AREA ACCESS RIGHTS OR OBLI-
GATIONS OF THE PROVIDER.
  (C)(1)  FOR  PURPOSES  OF DETERMINING THE CURRENT GENERATION BROADBAND
CREDIT UNDER SUBDIVISION (A) OF THIS SECTION WITH RESPECT  TO  QUALIFIED
EQUIPMENT THROUGH WHICH CURRENT GENERATION BROADBAND SERVICES ARE DELIV-
ERED,  IF  THE  QUALIFIED  EQUIPMENT  IS  CAPABLE  OF  SERVING  BOTH THE
SUBSCRIBERS DESCRIBED UNDER PARAGRAPH ONE OF  SUBDIVISION  (A)  OF  THIS
SECTION  AND  OTHER  SUBSCRIBERS,  THE  QUALIFIED  EXPENDITURES SHALL BE
MULTIPLIED BY A FRACTION:
  (A) THE NUMERATOR OF WHICH IS THE SUM OF THE TOTAL POTENTIAL SUBSCRIB-
ER POPULATIONS WITHIN THE RURAL AREAS AND THE UNDERSERVED AREAS THAT THE
EQUIPMENT IS  CAPABLE  OF  SERVING  WITH  CURRENT  GENERATION  BROADBAND
SERVICES; AND
  (B)  THE  DENOMINATOR OF WHICH IS THE TOTAL POTENTIAL SUBSCRIBER POPU-
LATION OF THE AREA THAT THE EQUIPMENT IS CAPABLE OF SERVING WITH CURRENT
GENERATION BROADBAND SERVICES.
  (2) FOR PURPOSES OF DETERMINING THE NEXT GENERATION  BROADBAND  CREDIT
UNDER  SUBDIVISION  (A) OF THIS SECTION WITH RESPECT TO QUALIFIED EQUIP-
MENT THROUGH WHICH NEXT GENERATION BROADBAND SERVICES ARE DELIVERED,  IF
THE  QUALIFIED  EQUIPMENT  IS  CAPABLE  OF  SERVING BOTH THE SUBSCRIBERS
DESCRIBED UNDER PARAGRAPH TWO OF SUBDIVISION (A)  OF  THIS  SECTION  AND

S. 4523--B                          3

OTHER  SUBSCRIBERS,  THE QUALIFIED EXPENDITURES SHALL BE MULTIPLIED BY A
FRACTION:
  (A)  THE  NUMERATOR  OF  WHICH  IS THE SUM OF: (I) THE TOTAL POTENTIAL
SUBSCRIBER POPULATIONS WITHIN THE RURAL AREAS AND THE UNDERSERVED  AREAS
THAT  THE EQUIPMENT IS CAPABLE OF SERVING WITH NEXT GENERATION BROADBAND
SERVICES AND (II) THE TOTAL POTENTIAL SUBSCRIBER POPULATION OF THE  AREA
CONSISTING  ONLY  OF RESIDENTIAL SUBSCRIBERS NOT DESCRIBED IN CLAUSE (I)
OF THIS SUBPARAGRAPH THAT THE EQUIPMENT IS CAPABLE OF SERVING WITH  NEXT
GENERATION BROADBAND SERVICES; AND
  (B)  THE  DENOMINATOR OF WHICH IS THE TOTAL POTENTIAL SUBSCRIBER POPU-
LATION OF THE AREA THAT THE EQUIPMENT IS CAPABLE OF  SERVING  WITH  NEXT
GENERATION BROADBAND SERVICES.
  (D)  FOR  PURPOSES OF THIS SECTION, THE FOLLOWING WORDS SHALL HAVE THE
FOLLOWING MEANINGS:
  (1) "CURRENT GENERATION BROADBAND SERVICE" SHALL MEAN THE TRANSMISSION
OF SIGNALS AT A RATE OF AT LEAST TEN MILLION  BITS  PER  SECOND  TO  THE
SUBSCRIBER AND AT LEAST ONE MILLION BITS PER SECOND FROM THE SUBSCRIBER.
  (2) "NEXT GENERATION BROADBAND SERVICE" SHALL MEAN THE TRANSMISSION OF
SIGNALS  AT  A  RATE  OF  AT LEAST TWENTY MILLION BITS PER SECOND TO THE
SUBSCRIBER AND AT LEAST FIVE MILLION BITS PER SECOND FROM THE  SUBSCRIB-
ER.
  (3)  "NONRESIDENTIAL  SUBSCRIBER"  SHALL  MEAN  A PERSON WHO PURCHASES
BROADBAND SERVICES WHICH ARE DELIVERED TO THE PERMANENT PLACE  OF  BUSI-
NESS OF SUCH PERSON.
  (4) "PERSON" SHALL MEAN AN INDIVIDUAL, CORPORATION, PARTNERSHIP, ASSO-
CIATION, GOVERNMENTAL ENTITY, OR ANY OTHER LEGAL ENTITY.
  (5)  "QUALIFIED  EQUIPMENT" SHALL MEAN THE EQUIPMENT OF A TELECOMMUNI-
CATIONS PROVIDER THAT IS CAPABLE OF PROVIDING CURRENT GENERATION  BROAD-
BAND  SERVICES  OR  NEXT  GENERATION BROADBAND SERVICES AT ANY TIME, AND
WITHOUT REGARD TO ANY PARTICULAR TRANSMISSION MEDIUM OR  TECHNOLOGY,  TO
EACH SUBSCRIBER WHO IS UTILIZING SUCH SERVICES.
  (6)  "QUALIFIED EXPENDITURE" SHALL MEAN ANY AMOUNT CHARGEABLE TO CAPI-
TAL ACCOUNT WITH RESPECT TO THE PURCHASE AND INSTALLATION  OF  QUALIFIED
EQUIPMENT (INCLUDING ANY UPGRADES THERETO).
  (7)  "RESIDENTIAL  SUBSCRIBER"  SHALL MEAN AN INDIVIDUAL WHO PURCHASES
BROADBAND SERVICES WHICH ARE DELIVERED TO SUCH INDIVIDUAL'S DWELLING.
  (8) "RURAL AREA" SHALL MEAN ANY CENSUS TRACT WHICH:
  (A) IS NOT WITHIN TEN MILES OF ANY INCORPORATED OR  CENSUS  DESIGNATED
PLACE CONTAINING MORE THAN SEVENTY THOUSAND PEOPLE, AND
  (B)  IS  NOT WITHIN A COUNTY OR COUNTY EQUIVALENT WHICH HAS AN OVERALL
POPULATION DENSITY OF MORE THAN EIGHT HUNDRED PEOPLE PER SQUARE MILE  OF
LAND.
  (9) "RURAL SUBSCRIBER" SHALL MEAN A RESIDENTIAL SUBSCRIBER RESIDING IN
A  DWELLING  LOCATED  IN A RURAL AREA OR NONRESIDENTIAL SUBSCRIBER MAIN-
TAINING A PERMANENT PLACE OF BUSINESS LOCATED IN A RURAL AREA.
  (10) "SUBSCRIBER" SHALL  MEAN  A  PERSON  WHO  PURCHASES  OR  RECEIVES
CURRENT  GENERATION  BROADBAND  SERVICES  OR  NEXT  GENERATION BROADBAND
SERVICES.
  (11) "TELECOMMUNICATIONS PROVIDER" OR "PROVIDER" SHALL MEAN A  PERSON,
OR AN AFFILIATE OF SUCH PERSON, EITHER OF WHICH FOR COMPENSATION DEPLOYS
FACILITIES  USED DIRECTLY OR INDIRECTLY IN THE PROVISIONS OF INTRASTATE,
INTERSTATE OR INTERNATIONAL  TELECOMMUNICATIONS,  WHETHER  ON  A  COMMON
CARRIAGE, PRIVATE CARRIAGE, WHOLESALE, OR RETAIL BASIS.
  (12)  "TOTAL POTENTIAL SUBSCRIBER POPULATION" SHALL MEAN, WITH RESPECT
TO ANY AREA AND BASED ON THE MOST RECENT CENSUS DATA, THE  TOTAL  NUMBER
OF  POTENTIAL  RESIDENTIAL  SUBSCRIBERS RESIDING IN DWELLINGS LOCATED IN

S. 4523--B                          4

SUCH AREA AND POTENTIAL NONRESIDENTIAL SUBSCRIBERS MAINTAINING PERMANENT
PLACES OF BUSINESS LOCATED IN SUCH AREA.
  (13)  "UNDERSERVED  AREA" SHALL MEAN ANY CENSUS TRACT WHICH IS LOCATED
IN:
  (A) AN EMPOWERMENT  ZONE  OR  ENTERPRISE  COMMUNITY  DESIGNATED  UNDER
SECTION 1391 OF THE UNITED STATES INTERNAL REVENUE CODE OF 1986;
  (B)  A  RENEWAL COMMUNITY DESIGNATED UNDER SECTION 1400E OF THE UNITED
STATES INTERNAL REVENUE CODE OF 1986; OR
  (C) A LOW-INCOME COMMUNITY DESIGNATED UNDER SECTION 45D OF THE  UNITED
STATES INTERNAL REVENUE CODE OF 1986.
  (14)  "UNDERSERVED  SUBSCRIBER"  SHALL  MEAN  A RESIDENTIAL SUBSCRIBER
RESIDING IN A DWELLING LOCATED IN AN UNDERSERVED AREA OR  NONRESIDENTIAL
SUBSCRIBER  MAINTAINING  A  PERMANENT  PLACE  OF  BUSINESS LOCATED IN AN
UNDERSERVED AREA.
  (15) "NODE" SHALL MEAN THE  CABINET  AND  EQUIPMENT,  INCLUDING  POWER
SUPPLY,  FANS,  GAS  GENERATORS,  BATTERIES  AND  OPTICAL  TO ELECTRICAL
CONVERTERS, LOCATED IN THE NEIGHBORHOODS WHICH SERVE HOMES,  BUSINESSES,
AND  INSTITUTIONS,  AND  WHICH  IS  THE POINT WHERE FIBER FACILITIES AND
COAXIAL FACILITIES ARE CONNECTED.
  (16) "POINT OF PRESENCE" SHALL MEAN THE  SPECIFIC  LOCATION  WITHIN  A
LOCAL  ACCESS  TRANSPORT  AREA WHERE A CONNECTION TO THE INTERNET TERMI-
NATES AND/OR ORIGINATES ITS SERVICE, AND SUCH PHYSICAL  LOCATION  HOUSES
SERVERS,  ROUTERS,  ATM  SWITCHES, AND OTHER DEVICES BY WHICH A COMMUNI-
CATIONS CARRIER ALLOWS OTHER CARRIERS TO ACCESS ITS NETWORK.
  (17) "CENTRAL OFFICE" SHALL MEAN AN OFFICE  IN  A  LOCALITY  TO  WHICH
SUBSCRIBER  HOME  AND  BUSINESS  LINES ARE CONNECTED ON WHAT IS CALLED A
LOCAL LOOP, CONTAINING SWITCHING EQUIPMENT THAT CAN SWITCH CALLS LOCALLY
OR TO LONG-DISTANCE CARRIER PHONE OFFICES.
  (E) THE TOTAL FISCAL IMPACT OF THE  RURAL  BROADBAND  DEVELOPMENT  TAX
CREDIT SHALL NOT EXCEED ONE HUNDRED MILLION DOLLARS EACH YEAR.
  S  4.  This  act shall take effect on the ninetieth day after it shall
have become a law and shall expire and  be  deemed  repealed  March  31,
2018.

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