S T A T E O F N E W Y O R K
________________________________________________________________________
6578
2015-2016 Regular Sessions
I N A S S E M B L Y
March 27, 2015
___________
Introduced by M. of A. ENGLEBRIGHT, COLTON, CYMBROWITZ, SCHIMMINGER,
ORTIZ, SCHIMEL -- Multi-Sponsored by -- M. of A. AUBRY, CLARK, COOK,
DINOWITZ, GALEF, LENTOL, McDONOUGH, PERRY, RIVERA, ROBINSON -- read
once and referred to the Committee on Ways and Means
AN ACT to amend the tax law, in relation to pollution tax credits for
the purchase of certain equipment made by dry cleaning businesses
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. Subdivision (a) of section 1115 of the tax law is amended
by adding a new paragraph 44 to read as follows:
(44) EQUIPMENT OR MACHINERY CERTIFIED BY THE DEPARTMENT OF ENVIRON-
MENTAL CONSERVATION, PURSUANT TO REGULATIONS PROMULGATED BY SUCH DEPART-
MENT, FOR POLLUTION PREVENTION OR CONTROL WHICH, FOR PURPOSES OF THIS
PARAGRAPH, SHALL MEAN ANY PROCESS, FACILITY, DEVICE, FIXTURE, EQUIPMENT
OR MACHINERY USED PRIMARILY FOR THE CONTROL, PREVENTION OR ABATEMENT OF
POLLUTION OR CONTAMINANTS FROM THE OPERATION OF A DRY CLEANING PLANT,
INCLUDING ANY STRUCTURE, MACHINERY OR EQUIPMENT INSTALLED IN THE RECON-
STRUCTION OR REPLACEMENT OF SUCH PROCESS, FACILITY, DEVICE, FIXTURE,
EQUIPMENT OR MACHINERY.
S 2. Subparagraph (A) of paragraph 2 of subsection (a) of section
606 of the tax law, as amended by chapter 637 of the laws of 2008, is
amended to read as follows:
(A) A credit shall be allowed under this subsection with respect to
tangible personal property and other tangible property, including build-
ings and structural components of buildings, which are: depreciable
pursuant to section one hundred sixty-seven of the internal revenue
code, have a useful life of four years or more, are acquired by purchase
as defined in section one hundred seventy-nine (d) of the internal
revenue code, have a situs in this state and are (i) principally used by
the taxpayer in the production of goods by manufacturing, processing,
assembling, refining, mining, extracting, farming, agriculture, horti-
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD10122-01-5
A. 6578 2
culture, floriculture, viticulture or commercial fishing, (ii) indus-
trial waste treatment facilities or air pollution control facilities,
used in the taxpayer's trade or business OR BUSINESS INVESTMENTS MADE BY
DRY CLEANING BUSINESSES TO ACHIEVE POLLUTION PREVENTION INCLUDING
INVESTMENTS INTO CHANGES IN FACILITY PROCESSES OR OPERATIONS METHODS,
(iii) research and development property, (iv) principally used in the
ordinary course of the taxpayer's trade or business as a broker or deal-
er in connection with the purchase or sale (which shall include but not
be limited to the issuance, entering into, assumption, offset, assign-
ment, termination, or transfer) of stocks, bonds or other securities as
defined in section four hundred seventy-five (c)(2) of the Internal
Revenue Code, or of commodities as defined in section 475(e) of the
Internal Revenue Code, (v) principally used in the ordinary course of
the taxpayer's trade or business of providing investment advisory
services for a regulated investment company as defined in section eight
hundred fifty-one of the Internal Revenue Code, or lending, loan
arrangement or loan origination services to customers in connection with
the purchase or sale (which shall include but not be limited to the
issuance, entering into, assumption, offset, assignment, termination, or
transfer) of securities as defined in section four hundred seventy-five
(c)(2) of the Internal Revenue Code, or (vi) principally used as a qual-
ified film production facility including qualified film production
facilities having a situs in an empire zone designated as such pursuant
to article eighteen-B of the general municipal law, where the taxpayer
is providing three or more services to any qualified film production
company using the facility, including such services as a studio lighting
grid, lighting and grip equipment, multi-line phone service, broadband
information technology access, industrial scale electrical capacity,
food services, security services, and heating, ventilation and air
conditioning. For purposes of clauses (iv) and (v) of this subparagraph,
property purchased by a taxpayer affiliated with a regulated broker,
dealer, or registered investment adviser is allowed a credit under this
subsection if the property is used by its affiliated regulated broker,
dealer or registered investment adviser in accordance with this
subsection. For purposes of determining if the property is principally
used in qualifying uses, the uses by the taxpayer described in clauses
(iv) and (v) of this subparagraph may be aggregated. In addition, the
uses by the taxpayer, its affiliated regulated broker, dealer and regis-
tered investment adviser under either or both of those clauses may be
aggregated. Provided, however, a taxpayer shall not be allowed the cred-
it provided by clauses (iv) and (v) of this subparagraph unless (I)
eighty percent or more of the employees performing the administrative
and support functions resulting from or related to the qualifying uses
of such equipment are located in this state, or (II) the average number
of employees that perform the administrative and support functions
resulting from or related to the qualifying uses of such equipment and
are located in this state during the taxable year for which the credit
is claimed is equal to or greater than ninety-five percent of the aver-
age number of employees that perform these functions and are located in
this state during the thirty-six months immediately preceding the year
for which the credit is claimed, or (III) the number of employees
located in this state during the taxable year for which the credit is
claimed is equal to or greater than ninety percent of the number of
employees located in this state on December thirty-first, nineteen
hundred ninety-eight or, if the taxpayer was not a calendar year taxpay-
er in nineteen hundred ninety-eight, the last day of its first taxable
A. 6578 3
year ending after December thirty-first, nineteen hundred ninety-eight.
If the taxpayer becomes subject to tax in this state after the taxable
year beginning in nineteen hundred ninety-eight, then the taxpayer is
not required to satisfy the employment test provided in the preceding
sentence of this subparagraph for its first taxable year. For the
purposes of clause (III) of this subparagraph the employment test will
be based on the number of employees located in this state on the last
day of the first taxable year the taxpayer is subject to tax in this
state. If the uses of the property must be aggregated to determine
whether the property is principally used in qualifying uses, then either
each affiliate using the property must satisfy this employment test or
this employment test must be satisfied through the aggregation of the
employees of the taxpayer, its affiliated regulated broker, dealer, and
registered investment adviser using the property. For purposes of this
subsection, the term "goods" shall not include electricity.
S 3. Subparagraph (B) of paragraph 2 of subsection (a) of section 606
of the tax law is amended by adding three new clauses (vi), (vii) and
(viii) to read as follows:
(VI) POLLUTION PREVENTION SHALL MEAN CHANGES IN PRODUCTION METHODS OR
RAW MATERIALS THAT REDUCE, AVOID OR ELIMINATE THE USE OF TOXIC OR
HAZARDOUS SUBSTANCES OR THE GENERATION OF SUCH SUBSTANCES OR POLLUTANTS
PER UNIT OF PRODUCT, SO AS TO REDUCE RISKS TO THE HEALTH OF WORKERS,
CONSUMERS OR THE ENVIRONMENT, WITHOUT SHIFTING RISKS BETWEEN WORKERS,
CONSUMERS OR ENVIRONMENTAL MEDIA. POLLUTION PREVENTION INCLUDES THE
REDESIGN, MODIFICATION, UPGRADE OR REPLACEMENT OF PRODUCTION PROCESSES,
EQUIPMENT OR TECHNOLOGY; REFORMULATION OR REDESIGN OF PRODUCTS, SUBSTI-
TUTION OF INPUTS OR RAW MATERIALS; IMPROVEMENTS IN HOUSEKEEPING, MAINTE-
NANCE, TRAINING OR INVENTORY CONTROL; AND EXTENDED USE OR REUSE OF MATE-
RIALS THROUGH METHODS INTEGRAL TO THE PRODUCTION PROCESS, SUCH AS
IN-PROCESS, CLOSED-LOOP RECYCLING. SUCH TERM DOES NOT INCLUDE INCINERA-
TION, TRANSFER FROM ONE MEDIUM OF RELEASE OR DISCHARGE TO ANOTHER MEDIA,
OFF-SITE OR OUT-OF-PRODUCTION RECYCLING, END-OF-PIPE TREATMENT OR
POLLUTION CONTROL.
(VII) POLLUTANT SHALL MEAN ANY SUBSTANCE, CONTAMINANT, WASTE OR EMIS-
SION WHICH CONTRIBUTES TO POLLUTION AS DEFINED IN ARTICLE ONE OF THE
ENVIRONMENTAL CONSERVATION LAW.
(VIII) TOXIC OR HAZARDOUS SUBSTANCE SHALL MEAN ANY SUBSTANCE LISTED AS
A SUBSTANCE HAZARDOUS TO PUBLIC HEALTH, SAFETY OR THE ENVIRONMENT IN
REGULATIONS PROMULGATED PURSUANT TO ARTICLE THIRTY-SEVEN OF THE ENVIRON-
MENTAL CONSERVATION LAW.
S 4. Subparagraph (i) of paragraph (b) of subdivision 1 of section
210-B of the tax law, as added by section 17 of part A of chapter 59 of
the laws of 2014, is amended to read as follows:
(i) A credit shall be allowed under this subdivision with respect to
tangible personal property and other tangible property, including build-
ings and structural components of buildings, which are: depreciable
pursuant to section one hundred sixty-seven of the internal revenue
code, have a useful life of four years or more, are acquired by purchase
as defined in section one hundred seventy-nine (d) of the internal
revenue code, have a situs in this state and are (A) principally used by
the taxpayer in the production of goods by manufacturing, processing,
assembling, refining, mining, extracting, farming, agriculture, horti-
culture, floriculture, viticulture or commercial fishing, (B) industrial
waste treatment facilities or air pollution control facilities, used in
the taxpayer's trade or business, (C) research and development property
OR BUSINESS INVESTMENTS MADE BY DRY CLEANING BUSINESSES TO ACHIEVE
A. 6578 4
POLLUTION PREVENTION INCLUDING INVESTMENTS INTO CHANGES IN FACILITY
PROCESSES OR OPERATIONS OR PRODUCTION METHODS, or (D) principally used
in the ordinary course of the taxpayer's trade or business as a broker
or dealer in connection with the purchase or sale (which shall include
but not be limited to the issuance, entering into, assumption, offset,
assignment, termination, or transfer) of stocks, bonds or other securi-
ties as defined in section four hundred seventy-five (c)(2) of the
Internal Revenue Code, or of commodities as defined in section four
hundred seventy-five (e) of the Internal Revenue Code, (E) principally
used in the ordinary course of the taxpayer's trade or business of
providing investment advisory services for a regulated investment compa-
ny as defined in section eight hundred fifty-one of the Internal Revenue
Code, or lending, loan arrangement or loan origination services to
customers in connection with the purchase or sale (which shall include
but not be limited to the issuance, entering into, assumption, offset,
assignment, termination, or transfer) of securities as defined in
section four hundred seventy-five (c)(2) of the Internal Revenue Code,
(F) originally used in the ordinary course of the taxpayer's business as
an exchange registered as a national securities exchange within the
meaning of sections 3(a)(1) and 6(a) of the Securities Exchange Act of
1934 or a board of trade as defined in section 1410(a)(1) of the New
York Not-for-Profit Corporation Law or as an entity that is wholly owned
by one or more such national securities exchanges or boards of trade and
that provides automation or technical services thereto, or (G) princi-
pally used as a qualified film production facility including qualified
film production facilities having a situs in an empire zone designated
as such pursuant to article eighteen-B of the general municipal law,
where the taxpayer is providing three or more services to any qualified
film production company using the facility, including such services as a
studio lighting grid, lighting and grip equipment, multi-line phone
service, broadband information technology access, industrial scale elec-
trical capacity, food services, security services, and heating, venti-
lation and air conditioning. Provided, however, a taxpayer shall not be
allowed the credit provided by clauses (D), (E) and (F) of this subpara-
graph unless (i) eighty percent or more of the employees performing the
administrative and support functions resulting from or related to the
qualifying uses of such equipment are located in this state or (ii) the
average number of employees that perform the administrative and support
functions resulting from or related to the qualifying uses of such
equipment and are located in this state during the taxable year for
which the credit is claimed is equal to or greater than ninety-five
percent of the average number of employees that perform these functions
and are located in this state during the thirty-six months immediately
preceding the year for which the credit is claimed, or (iii) the number
of employees located in this state during the taxable year for which the
credit is claimed is equal to or greater than ninety percent of the
number of employees located in this state on December thirty-first,
nineteen hundred ninety-eight or, if the taxpayer was not a calendar
year taxpayer in nineteen hundred ninety-eight, the last day of its
first taxable year ending after December thirty-first, nineteen hundred
ninety-eight. If the taxpayer becomes subject to tax in this state after
the taxable year beginning in nineteen hundred ninety-eight, then the
taxpayer is not required to satisfy the employment test provided in the
preceding sentence of this subparagraph for its first taxable year. For
purposes of clause (iii) of this subparagraph the employment test will
be based on the number of employees located in this state on the last
A. 6578 5
day of the first taxable year the taxpayer is subject to tax in this
state. If the uses of the property must be aggregated to determine
whether the property is principally used in qualifying uses, then either
each affiliate using the property must satisfy this employment test or
this employment test must be satisfied through the aggregation of the
employees of the taxpayer, its affiliated regulated broker, dealer, and
registered investment adviser using the property. For purposes of this
subdivision, the term "goods" shall not include electricity.
S 5. Subparagraph (ii) of paragraph (b) of subdivision 1 of section
210-B of the tax law is amended by adding three new clauses (F), (G) and
(H) to read as follows:
(F) POLLUTION PREVENTION SHALL MEAN CHANGES IN PRODUCTION METHODS OR
RAW MATERIALS THAT REDUCE, AVOID OR ELIMINATE THE USE OF TOXIC OR
HAZARDOUS SUBSTANCES OR THE GENERATION OF SUCH SUBSTANCES OR POLLUTANTS
PER UNIT OF PRODUCT, SO AS TO REDUCE RISKS TO THE HEALTH OF WORKERS,
CONSUMERS OR THE ENVIRONMENT, WITHOUT SHIFTING RISKS BETWEEN WORKERS,
CONSUMERS OR ENVIRONMENTAL MEDIA. POLLUTION PREVENTION INCLUDES THE
REDESIGN, MODIFICATION, UPGRADE OR REPLACEMENT OF PRODUCTION PROCESSES,
EQUIPMENT OR TECHNOLOGY; REFORMULATION OR REDESIGN OF PRODUCTS, SUBSTI-
TUTION OF INPUTS OR RAW MATERIALS; IMPROVEMENTS IN HOUSEKEEPING, MAINTE-
NANCE, TRAINING OR INVENTORY CONTROL; AND EXTENDED USE OR REUSE OF MATE-
RIALS THROUGH METHODS INTEGRAL TO THE PRODUCTION PROCESS, SUCH AS
IN-PROCESS, CLOSED-LOOP RECYCLING. SUCH TERM DOES NOT INCLUDE INCINERA-
TION, TRANSFER FROM ONE MEDIUM OF RELEASE OR DISCHARGE TO ANOTHER MEDIA,
OFF-SITE OR OUT-OF-PRODUCTION RECYCLING, END-OF-PIPE TREATMENT OR
POLLUTION CONTROL.
(G) POLLUTANT SHALL MEAN ANY SUBSTANCE, CONTAMINANT, WASTE OR EMISSION
WHICH CONTRIBUTES TO POLLUTION AS DEFINED IN ARTICLE ONE OF THE ENVIRON-
MENTAL CONSERVATION LAW.
(H) TOXIC OR HAZARDOUS SUBSTANCE SHALL MEAN ANY SUBSTANCE LISTED AS A
SUBSTANCE HAZARDOUS TO PUBLIC HEALTH, SAFETY OR THE ENVIRONMENT IN REGU-
LATIONS PROMULGATED PURSUANT TO ARTICLE THIRTY-SEVEN OF THE ENVIRON-
MENTAL CONSERVATION LAW.
S 6. This act shall take effect three years after it shall have become
a law and shall apply to taxable years ending on or after such effective
date, except that section one of this act shall take effect on the first
day of the sales tax quarterly period, as designated in subdivision (b)
of section 1136 of the tax law, next commencing on or after the effec-
tive date of this act and shall apply to sales made on or after the
effective date of section one of this act and shall apply to all equip-
ment or machinery purchased on or after such date although purchased
under a prior contract.