Senate Bill S7398

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

                                  7398

                            I N  S E N A T E

                              May 14, 2014
                               ___________

Introduced  by  Sen.  FARLEY -- read twice and ordered printed, and when
  printed to be committed to the Committee on Investigations and Govern-
  ment Operations

AN ACT to amend the tax law,  in  relation  to  the  empire  state  film
  production credit

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

  Section 1. Paragraphs 1 and 2 of subdivision (b) of section 24 of  the
tax  law, paragraph 1 as amended by section 4 of part B of chapter 59 of
the laws of 2013 and paragraph 2 as added by section  1  of  part  P  of
chapter 60 of the laws of 2004, are 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  AND  THE COST OF CONSTRUCTING, EQUIPPING OR EXPANDING A
FILM PRODUCTION FACILITY WITHIN THE STATE.
  (2) "Production costs" means any costs for tangible property used  and
services performed directly and predominantly in the production (includ-
ing   pre-production   and   post   production)  of  a  qualified  film.
"Production costs" shall not include (i) costs for a  story,  script  or
scenario  to  be used for a qualified film and (ii) wages or salaries or
other compensation for writers, directors,  including  music  directors,
producers  and performers (other than background actors with no scripted
lines).  "Production  costs"  generally  include  technical   and   crew
production  costs,  such as expenditures for film production facilities,
or any part thereof, props, makeup, wardrobe, film  processing,  camera,
sound  recording,  set  construction,  lighting,  shooting,  editing and
meals. IN THE CASE  OF  CONSTRUCTING,  EQUIPPING  OR  EXPANDING  A  FILM
PRODUCTION  FACILITY,  "PRODUCTION  COSTS"  SHALL MEAN THE COST OR OTHER
BASIS FOR FEDERAL INCOME TAX PURPOSES OF TANGIBLE PERSONAL PROPERTY  AND
OTHER  TANGIBLE  PROPERTY, INCLUDING BUILDINGS AND STRUCTURAL COMPONENTS
OF BUILDINGS DESCRIBED IN PARAGRAPH (B) OF SUBDIVISION  ONE  OF  SECTION
TWO HUNDRED TEN-B OF THIS CHAPTER.

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

                                                           LBD15174-01-4

S. 7398                             2

  S  2.  Paragraph 4 of subdivision (e) of section 24 of the tax law, as
amended by section 3 of part B of chapter 59 of the  laws  of  2013,  is
amended and a new paragraph 5 is added 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 additional four
hundred twenty million dollars in each year starting in two thousand ten
through two thousand nineteen 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 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 commissioner of economic
development determines that the aggregate amount of tax  credits  avail-
able  from  additional  pool  2 for the empire state film production tax
credit have been previously allocated, and determines that  the  pending
applications  from  eligible  applicants  for the empire state film post
production tax credit pursuant to section thirty-one of this 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 allo-
cation in the empire state film tax credit  pursuant  to  this  section,
subdivision  [thirty-six]  TWENTY of section two hundred [ten] TEN-B 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] THIRTY-TWO of section two  hundred
[ten]  TEN-B  and  subsection  [(gg)] (QQ) of section six hundred six of
this chapter. The governor'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 qualified 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, PROVIDED HOWEVER,  BEGINNING  ON  OR
AFTER APRIL FIRST, TWO THOUSAND FIFTEEN ALLOCATIONS FROM THIS POOL SHALL
GIVE PRIORITY TO APPLICANTS THAT PLAN TO CONSTRUCT, EQUIP OR EXPAND FILM
PRODUCTION FACILITIES WITHIN THE STATE.
  (5)  IF THE TAXPAYER CLAIMS THE CREDIT ALLOWED UNDER THIS SECTION, THE
TAXPAYER MAY NOT USE THE COST OF CONSTRUCTION,  EQUIPPING  OR  EXPANSION

S. 7398                             3

THAT  IS  THE  BASIS  FOR  THIS  CREDIT IN THE BASIS OF ANY OTHER CREDIT
ALLOWED UNDER THIS ARTICLE.
  S  3.  This  act  shall  take  effect on the same date and in the same
manner as section 15 of part A of chapter 59 of the laws of 2014,  takes
effect.