S T A T E   O F   N E W   Y O R K
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                                  4379

                       2015-2016 Regular Sessions

                          I N  A S S E M B L Y

                            January 30, 2015
                               ___________

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

AN ACT to amend the tax law, the real property tax law and the education
  law, in relation to eliminating the START-UP NY program; and to repeal
  certain provisions of the economic development law, the tax law, chap-
  ter 68 of the laws of 2013, amending the economic development law  and
  other  laws  relating  to  establishing  the  START-UP NY program, the
  administrative code of the city of New York  and  the  education  law,
  relating to the START-UP NY program

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

  Section 1. Article 21 of the economic development law is REPEALED.
  S 2. Sections 39, 39-a and 40 of the tax law are REPEALED.
  S 3. Subdivision 41 of section 210-B of the tax law is REPEALED.
  S 4. Clause (xxxvi) of subparagraph (B) of paragraph 1  of  subsection
(i) of section 606 of the tax law is REPEALED.
  S 5. Subsection (ww) of section 606 of the tax law is REPEALED.
  S  6.  Paragraph 40 of subsection (c) of section 612 of the tax law is
REPEALED.
  S 7. Section 803 of the tax law, as amended by section 11 of part A of
chapter 68 of the laws of 2013, is amended to read as follows:
  S 803. Exemption override. [(a) Except as provided in subdivision  (b)
of  this section, any] ANY exemption from tax specified in any other New
York state law will not apply to the tax imposed by this article.
  [(b) If a tax-free NY area approved  pursuant  to  the  provisions  of
article twenty-one of the economic development law is located within the
MCTD,  the payroll expense in such tax-free NY area of any employer that
is located in such area and accepted into the START-UP NY program  shall
be  exempt from the tax imposed under this article. In addition, the net
earnings from self-employment of an individual from a business  in  such

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD00773-02-5

              

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tax-free  NY area that is accepted into the START-UP NY program shall be
exempt from the tax imposed under this article.]
  S  8. Paragraphs 1 and 2 of subdivision (d) of section 1119 of the tax
law, as amended by section 12 of part A of chapter 68  of  the  laws  of
2013, are 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  [or  to a business located in a tax-free NY area approved
pursuant  to  article  twenty-one  of  the  economic  development  law],
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 subdivi-
sion  (b) of section eleven hundred five of this article is directly and
exclusively, used or consumed by (i) such qualified empire  zone  enter-
prise  in an area designated as an empire zone pursuant to article eigh-
teen-B of the general municipal law with respect to  which  such  enter-
prise  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 inno-
vation hot spot[, or (iii) such business at its location  in  such  tax-
free  NY  area,] 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 (iii) such business
at its location in such tax-free NY area,] or (C) the enterprise's place
of primary use of the service described in paragraph two of such  subdi-
vision  (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  inno-
vation  hot  spot[,  or  at  its  location  in  such  tax-free NY area];
provided, further, that, in order for a motor  vehicle,  as  defined  in
subdivision  (c)  of  section eleven hundred seventeen of this [article]
PART, 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 subdivi-
sion, 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.
  (2) 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, and consideration given or contracted to be  given  for,
or  for  the  use  of,  tangible personal property sold to a contractor,

A. 4379                             3

subcontractor or repairman for use in (A) erecting a structure or build-
ing of a qualified empire zone enterprise [or a business  located  in  a
tax-free NY area approved pursuant to article twenty-one of the economic
development  law],  (B)  adding to, altering or improving real property,
property or land of such an enterprise [or such business,] or (C)  main-
taining,  servicing or repairing real property, property or land of such
an enterprise [or of such business], as the terms real property, proper-
ty or land are defined in the real property tax law; provided,  however,
no  credit  or  refund  will be allowed under this paragraph unless such
tangible personal property is to become an integral  component  part  of
such  structure, building, real property, property or land located in an
area designated as an empire zone pursuant to article eighteen-B of  the
general  municipal  law in, and with respect to which such enterprise is
certified pursuant to such article eighteen-B[, or in an  area  approved
as  a  tax-free  NY  area pursuant to article twenty-one of the economic
development law where such business is located].
  S 9. Paragraph 11 of subdivision (b) of section 1405 of the tax law is
REPEALED.
  S 10.  Section 14 of part A of chapter 68 of the laws of 2013,  amend-
ing the economic development law and other laws relating to establishing
the START-UP NY program, is REPEALED.
  S 11. Paragraph 36 of subdivision (c) of section 11-1712 of the admin-
istrative code of the city of New York is REPEALED.
  S 12. Subsection (d) of section 1340 of the tax law is REPEALED.
  S  13. Subdivision 2 of section 420-a of the real property tax law, as
amended by section 17 of part A of chapter 68 of the laws  of  2013,  is
amended to read as follows:
  2.  If any portion of such real property is not so used exclusively to
carry out thereupon one or more of such purposes but is leased or other-
wise used for other purposes, such portion shall be subject to  taxation
and  the remaining portion only shall be exempt; provided, however, that
such real property shall be fully exempt from taxation although it or  a
portion  thereof  is  used (a) for purposes which are exempt pursuant to
this section or sections four hundred twenty-b, four hundred twenty-two,
four hundred twenty-four, four hundred twenty-six, four hundred  twenty-
eight, four hundred thirty or four hundred fifty of this [chapter] TITLE
by  another  corporation  which  owns real property exempt from taxation
pursuant to such sections or whose real property if it owned  any  would
be  exempt  from  taxation  pursuant  to such sections, (b) for purposes
which are exempt pursuant to section four hundred six  or  section  four
hundred eight of this [chapter] ARTICLE by a corporation which owns real
property  exempt  from  taxation pursuant to such section or if it owned
any would be exempt from taxation pursuant  to  such  section,  (c)  for
purposes  which  are  exempt pursuant to section four hundred sixteen of
this chapter by an organization which owns  real  property  exempt  from
taxation pursuant to such section or whose real property if it owned any
would  be  exempt  from  taxation  pursuant  to such section, OR (d) for
purposes relating to civil  defense  pursuant  to  the  New  York  state
defense emergency act, including but not limited to activities in prepa-
ration  for  anticipated  attack,  during attack, or following attack or
false warning thereof, or in connection with drill or  test  ordered  or
directed  by  civil  defense authorities[, or (e) for purposes of a tax-
free NY area that has been approved pursuant to  article  twenty-one  of
the  economic  development  law, subject to the conditions that the real
property must have been owned by the corporation or  association  organ-
ized  exclusively  for  educational purposes and exempt pursuant to this

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section on June first, two thousand thirteen,  and  that  the  exemption
shall  apply  only to the portion of such real property that is used for
purposes of the START-UP NY program]; and  provided  further  that  such
real  property  shall  be  exempt  from taxation only so long as it or a
portion thereof, as the case may be, is devoted to such exempt  purposes
and  so long as any moneys paid for such use do not exceed the amount of
the carrying, maintenance and depreciation charges of  the  property  or
portion thereof, as the case may be.
  S  14.  Paragraph  a  of subdivision 2 of section 355 of the education
law, as amended by section 18 of part A of chapter 68  of  the  laws  of
2013, is amended to read as follows:
  a.  To  take, hold and administer on behalf of the state university or
any institution therein, real and  personal  property  or  any  interest
therein  and  the  income  thereof either absolutely or in trust for any
educational or other  purpose  within  the  jurisdiction  and  corporate
purposes  of the state university. The trustees may acquire property for
such purposes by purchase, appropriation or lease and by the  acceptance
of  gifts, grants, bequests and devises, and, within appropriations made
therefor, may equip and furnish buildings and otherwise improve property
owned, used or occupied by the state university or any institution ther-
ein. The trustees may acquire property by the acceptance of  conditional
gifts,  grants, devises or bequests, the provisions of section eleven of
the state finance law notwithstanding. Where  real  property  is  to  be
acquired  by  purchase  or  appropriation,  such acquisition shall be in
accordance with the provisions of section three hundred  seven  of  this
chapter  except  that the powers and duties in said section mentioned to
be performed by the commissioner shall be performed by the state univer-
sity trustees. [The provisions of section three of the public lands  law
notwithstanding,  the  trustees may provide for the lease of state-owned
real property under the jurisdiction of the  state  university  that  is
part  of  a  tax-free NY area approved pursuant to article twenty-one of
the economic development law, in such manner and upon such terms as  the
trustees  shall  determine,  provided  such lease is consistent with the
approved plan for such tax-free NY area.]
  S 15. Paragraph s of subdivision 2 of section  355  of  the  education
law,  as  amended  by  section 19 of part A of chapter 68 of the laws of
2013, is amended to read as follows:
  s. To lease or make available to  the  state  university  construction
fund,  the  dormitory authority or other public benefit corporation, the
New York state teachers' retirement system[,]  OR  the  New  York  state
employees' retirement system[, or a business that intends to locate in a
tax-free NY area approved pursuant to article twenty-one of the economic
development  law,] a portion of the grounds or real property occupied by
a state-operated institution or statutory or contract  college  for  the
construction, acquisition, reconstruction, rehabilitation or improvement
of  academic buildings, dormitories or other facilities thereon pursuant
to article eight-A of this chapter and for the purpose  of  facilitating
such   construction,   acquisition,  reconstruction,  rehabilitation  or
improvement, to enter into leases and agreements for the use of any such
academic building, dormitory or other facility in  accordance  with  the
provisions  of  section  three  hundred  seventy-eight of this [chapter]
TITLE; provided, however, that nothing herein contained shall affect the
provisions of any lease or agreement heretofore executed  by  the  state
university  with  the dormitory authority. The state university trustees
may also enter into agreements with the  state  university  construction
fund,  the  dormitory authority or other public benefit corporation, the

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New York state teachers' retirement system[,]  OR  the  New  York  state
employees'  retirement system [or any business that intends to locate in
a tax-free NY area  approved  pursuant  to  article  twenty-one  of  the
economic  development law,] to furnish heat from a central heating plant
to any academic building, dormitory or other facility erected by them or
with moneys supplied by them. Any such academic building,  dormitory  or
other facility shall not be subject to taxation for any purpose.
  S 16. Paragraph z of subdivision 2 of section 355 of the education law
is REPEALED.
  S 17. Section 361 of the education law is REPEALED.
  S  18. This act shall take effect immediately; provided, however, that
the amendments to paragraph a of subdivision 2 of  section  355  of  the
education  law made by section fourteen of this act shall not affect the
expiration and reversion of such paragraph and shall be deemed to expire
therewith.