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

    S. 4610--A                                            A. 6721--A

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

                             March 31, 2015
                               ___________

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 -- again reported from said committee with
  amendments, ordered reprinted  as  amended  and  recommitted  to  said
  committee

AN ACT to amend chapter 41 of the laws of 1985 relating to providing for
  the construction of a civic center in Albany and making appropriations
  relating  to  the  construction  of  such facility, in relation to the
  repayment of such appropriation (Part A); to amend the economic devel-
  opment law, in relation to START-UP NY airport facilities (Part B); to
  amend the education law, in relation to transportation aid  (Part  C);
  to  amend the administrative code of the city of New York, in relation
  to the taxation of business  corporations  (Part  D);  establishing  a
  commission  on  legislative,  judicial and executive compensation, and
  providing for the powers and duties of  the  commission  and  for  the
  dissolution of the commission and repealing chapter 567 of the laws of
  2010  relating  to  establishing a special commission on compensation,
  and providing for their powers and duties;  and  to  provide  periodic
  salary  increases  to  state  officers  (Part E); to permit authorized
  state entities to utilize the design-build method  for  infrastructure
  projects; and providing for the repeal of such provisions upon expira-
  tion  thereof  (Part F); establishing the New York State water infras-
  tructure improvement act of 2015 (Part G); to amend the state  finance
  law,  in  relation  to  the creation of a new dedicated infrastructure
  investment fund (Part H); and to provide  for  the  administration  of
  certain  funds and accounts related to the 2015-16 budget, authorizing
  certain payments and transfers; to amend the  state  finance  law,  in
  relation to the rainy day reserve fund and the school tax relief fund;
  to amend the state finance law, in relation to payments, transfers and
  deposits;  to amend the state finance law, in relation to the issuance
  of bonds and notes; to amend the  New  York  state  urban  development

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

                      [ ] is old law to be omitted.
                                                           LBD12578-02-5

S. 4610--A                          2                         A. 6721--A

  corporation  act,  in  relation  to  funding project costs for certain
  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  hous-
  ing program bonds and notes; to amend chapter 329 of the laws of 1991,
  amending  the  state finance law and other laws relating to the estab-
  lishment of the dedicated highway and bridge trust fund,  in  relation
  to  the  issuance  of  bonds;  to amend the public authorities law, in
  relation to 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  funding
  project  costs  for  the Binghamton university school of pharmacy, New
  York power  electronic  manufacturing  consortium  and  the  nonprofit
  infrastructure capital investment program; to amend the public author-
  ities  law,  in  relation  to  the  state environmental infrastructure
  projects; 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 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  peace  bridge  and  transportation capital projects; to
  amend the public  authorities  law,  in  relation  to  dormitories  at
  certain  educational  institutions  other  than  state operated insti-
  tutions and statutory or contract colleges under the  jurisdiction  of
  the state university of New York; to amend the public authorities law,
  in relation to authorization for the issuance of bonds for the capital
  restructuring bond finance program and the health care facility trans-
  formation  program; 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 New York state  medical  care  facilities  finance
  agency act, in relation to bonds and mental health facilities improve-
  ment  notes; to amend the New York state urban development corporation
  act, in relation to the aggregate amount of and  issuance  of  certain
  bonds;  and  to  amend chapter 63 of the laws of 2005, relating to the
  composition and responsibilities of the New York state  higher  educa-
  tion  capital  matching  grant  board,  in  relation to increasing the
  amount of authorized matching capital grants; to amend  the  New  York
  state  urban  development corporation act, in relation to the issuance
  of bonds or notes for the purpose of funding project costs  associated
  with  capital  projects;  to  amend  the  public  authorities  law, in
  relation to financing of  the  metropolitan  transportation  authority
  transportation  facilities;  and  providing  for the repeal of certain
  provisions upon expiration thereof (Part I); and to amend  the  public
  health  law,  in  relation  to  establishing  the health care facility
  transformation program in Kings and Oneida counties;  in  relation  to
  establishing  the  essential  health care provider support program; in
  relation to  the  capital  restructuring  financing  program;  and  in
  relation  to  establishing the community health care revolving capital
  fund (Part J)

S. 4610--A                          3                         A. 6721--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 2015-2016
state fiscal year. Each component is  wholly  contained  within  a  Part
identified  as Parts A through J. 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.  Section  20 of chapter 41 of the laws of 1985 relating to
providing for the construction of a civic center in  Albany  and  making
appropriations relating to the construction of such facility, is amended
to read as follows:
  S  20.  The state comptroller is hereby authorized to receive from the
county, repayment of money disbursed from  this  appropriation  and  any
income  or  increment related thereto due to the investment thereof, and
to deposit the  same  to  the  credit  of  the  capital  projects  fund;
PROVIDED,  HOWEVER  THAT  ANY AND ALL MONEYS RECEIVED BY THE STATE COMP-
TROLLER FROM THE COUNTY OF ALBANY ON OR BEFORE APRIL 30, 2015, SHALL  BE
DEEMED  TO  BE  FULL REPAYMENT OF THE MONEY DISBURSED FROM THE APPROPRI-
ATION MADE IN SECTION ELEVEN OF THIS ACT AND  ANY  INCOME  OR  INCREMENT
RELATED THERETO DUE TO THE INVESTMENT THEREOF.
  S 2. This act shall take effect immediately.

                                 PART B

  Section  1.  Section 431 of the economic development law is amended by
adding a new subdivision 15 to read as follows:
  15. "START-UP NY AIRPORT FACILITY" MEANS VACANT LAND OR SPACE OWNED BY
THE STATE OF NEW YORK ON THE PREMISES OF  STEWART  AIRPORT  OR  REPUBLIC
AIRPORT.
  S  2. Subdivision 4 of section 435 of the economic development law, as
amended by section 2 of part BB of chapter 55 of the laws  of  2014,  is
amended to read as follows:
  4.  The  START-UP NY approval board, by majority vote, shall designate
correctional facilities described in  subdivision  fourteen  of  section
four  hundred thirty-one of this article, START-UP NY AIRPORT FACILITIES
DESCRIBED IN SUBDIVISION FIFTEEN OF SECTION FOUR HUNDRED  THIRTY-ONE  OF
THIS  ARTICLE  and  up  to  twenty strategic state assets as tax-free NY
areas. Each shall be affiliated with a  state  university  campus,  city
university  campus,  community college, or private college or university
and such designation shall require the support of the affiliated campus,
college or university.  Each  strategic  state  asset  AND  START-UP  NY
AIRPORT  FACILITY,  other than a correctional facility, may not exceed a
maximum of two hundred thousand square feet of  vacant  land  or  vacant
building  space designated as a tax-free NY area. Designation of strate-
gic state assets [and], correctional facilities described in subdivision
fourteen of section four hundred thirty-one of this article, AND  START-

S. 4610--A                          4                         A. 6721--A

UP  NY  AIRPORT  FACILITIES  DESCRIBED IN SUBDIVISION FIFTEEN OF SECTION
FOUR HUNDRED THIRTY-ONE OF THIS ARTICLE as tax-free NY areas  shall  not
count  against  any  square  footage limitations in section four hundred
thirty-two of this article.
  S 3. This act shall take effect immediately.

                                 PART C

  Section  1.  Subdivision  4  of  section 3627 of the education law, as
amended by section 7-b of part A of a  chapter  of  the  laws  of  2015,
amending the education law, relating to contracts for excellence, appor-
tionment  of  school  aid,  total foundation aid and the gap elimination
adjustment restoration, the teachers of tomorrow teacher recruitment and
retention program and waivers from certain duties, as proposed in legis-
lative bill numbers  S.2006-B  and  A.3006-B,  is  amended  to  read  as
follows:
  4.  Notwithstanding  any  other  provision of law to the contrary, any
expenditures for transportation provided pursuant to this section in the
two thousand thirteen--two thousand fourteen and two thousand  fourteen-
-two  thousand fifteen school year and thereafter and otherwise eligible
for transportation aid pursuant to subdivision seven of section  thirty-
six hundred two of this article shall be considered approved transporta-
tion expenses eligible for transportation aid, provided further that for
the two thousand thirteen--two thousand fourteen [and two thousand four-
teen--two  thousand  fifteen]  school  year such aid shall be limited to
eight million one hundred thousand dollars  and  for  the  two  thousand
FOURTEEN--TWO  THOUSAND  fifteen[--two thousand sixteen] school year and
thereafter such aid shall be limited to twelve million six hundred thou-
sand dollars. And provided further that such expenditures  eligible  for
aid  under this section shall supplement not supplant local expenditures
for such transportation in the two thousand twelve--two  thousand  thir-
teen school year.
  S  2.  This  act  shall  take  effect on the same date and in the same
manner as section 7-b of part A of a chapter of the laws of 2015, amend-
ing the education law, relating to contracts for excellence,  apportion-
ment of school aid, total foundation aid and the gap elimination adjust-
ment  restoration,  the  teachers  of  tomorrow  teacher recruitment and
retention program and waivers from certain duties, as proposed in legis-
lative bill numbers S.2006-B and A.3006-B, takes effect.

                                 PART D

  Section 1. Chapter 6 of title 11 of the  administrative  code  of  the
city  of  New  York is amended by adding a new subchapter 3-A to read as
follows:
                             SUBCHAPTER 3-A
                          CORPORATE TAX OF 2015
SECTION 11-651 APPLICABILITY.
        11-652  DEFINITIONS.
        11-653  IMPOSITION OF TAX; EXEMPTIONS.
        11-654  COMPUTATION OF TAX.
        11-654.1 NET OPERATING LOSS.
        11-654.2 RECEIPTS ALLOCATION.
        11-654.3 COMBINED REPORTS.
        11-655  REPORTS.
        11-656  PAYMENT AND LIEN OF TAX.

S. 4610--A                          5                         A. 6721--A

        11-657  DECLARATION OF ESTIMATED TAX.
        11-658  PAYMENTS ON ACCOUNT OF ESTIMATED TAX.
        11-659  COLLECTION OF TAXES.
        11-660  LIMITATIONS OF TIME.
  S 11-651 APPLICABILITY.    1. NOTWITHSTANDING ANYTHING TO THE CONTRARY
IN THIS CHAPTER, THIS SUBCHAPTER SHALL APPLY  TO  CORPORATIONS  FOR  TAX
YEARS COMMENCING ON OR AFTER JANUARY FIRST, TWO THOUSAND FIFTEEN, EXCEPT
THAT  IT  SHALL NOT APPLY TO ANY CORPORATION THAT (A) HAS AN ELECTION IN
EFFECT UNDER SUBSECTION (A) OF SECTION THIRTEEN HUNDRED SIXTY-TWO OF THE
INTERNAL REVENUE CODE OF  1986,  AS  AMENDED,  OR  (B)  IS  A  QUALIFIED
SUBCHAPTER  S  SUBSIDIARY  WITHIN  THE  MEANING  OF  PARAGRAPH  THREE OF
SUBSECTION (B) OF SECTION THIRTEEN HUNDRED  SIXTY-ONE  OF  THE  INTERNAL
REVENUE CODE OF 1986, AS AMENDED, IN ANY TAX YEAR COMMENCING ON OR AFTER
SUCH  DATE. SUBCHAPTERS TWO AND THREE OF THIS CHAPTER SHALL NOT APPLY TO
CORPORATIONS TO WHICH THIS SUBCHAPTER APPLIES FOR TAX  YEARS  COMMENCING
ON  OR  AFTER  JANUARY FIRST, TWO THOUSAND FIFTEEN, EXCEPT TO THE EXTENT
PROVIDED IN THIS SUBCHAPTER AND TO THE EXTENT THAT  THE  EFFECT  OF  THE
APPLICATION  OF  SUBCHAPTERS TWO AND THREE TO TAX YEARS COMMENCING PRIOR
TO JANUARY FIRST,  TWO  THOUSAND  FIFTEEN  CARRIES  OVER  TO  TAX  YEARS
COMMENCING ON OR AFTER JANUARY FIRST, TWO THOUSAND FIFTEEN.
  2.  EACH  REFERENCE  IN  THIS CODE TO SUBCHAPTERS TWO OR THREE OF THIS
CHAPTER, OR ANY OF THE PROVISIONS THEREOF, SHALL BE DEEMED  A  REFERENCE
ALSO  TO  THIS SUBCHAPTER, AND ANY OF THE APPLICABLE PROVISIONS THEREOF,
WHERE APPROPRIATE AND WITH ALL NECESSARY MODIFICATIONS.
  S 11-652 DEFINITIONS.  1. (A) THE TERM "CORPORATION" INCLUDES  (1)  AN
ASSOCIATION  WITHIN  THE MEANING OF PARAGRAPH THREE OF SUBSECTION (A) OF
SECTION SEVENTY-SEVEN HUNDRED ONE OF THE INTERNAL REVENUE CODE  (INCLUD-
ING,  WHEN  APPLICABLE,  A LIMITED LIABILITY COMPANY), (2) A JOINT-STOCK
COMPANY OR ASSOCIATION, (3) A PUBLICLY TRADED PARTNERSHIP TREATED  AS  A
CORPORATION  FOR  PURPOSES  OF  THE  INTERNAL  REVENUE  CODE PURSUANT TO
SECTION  SEVENTY-SEVEN  HUNDRED  FOUR  THEREOF  AND  (4)  ANY   BUSINESS
CONDUCTED  BY  A  TRUSTEE  OR  TRUSTEES WHEREIN INTEREST OR OWNERSHIP IS
EVIDENCED BY CERTIFICATE OR OTHER WRITTEN INSTRUMENT;
  (B) (1) NOTWITHSTANDING PARAGRAPH (A) OF THIS SUBDIVISION, AN UNINCOR-
PORATED ORGANIZATION THAT (I) IS DESCRIBED IN SUBPARAGRAPH ONE OR  THREE
OF PARAGRAPH (A) OF THIS SUBDIVISION, (II) WAS SUBJECT TO THE PROVISIONS
OF CHAPTER FIVE OF THIS TITLE FOR ITS TAXABLE YEAR BEGINNING IN NINETEEN
HUNDRED NINETY-FIVE, AND (III) MADE A ONE-TIME ELECTION NOT TO BE TREAT-
ED  AS  A  CORPORATION  AND,  INSTEAD,  TO CONTINUE TO BE SUBJECT TO THE
PROVISIONS OF CHAPTER FIVE OF THIS TITLE FOR ITS TAXABLE YEARS BEGINNING
IN NINETEEN HUNDRED NINETY-SIX AND  THEREAFTER,  SHALL  CONTINUE  TO  BE
SUBJECT  TO THE PROVISIONS OF CHAPTER FIVE OF THIS TITLE FOR ITS TAXABLE
YEARS BEGINNING IN NINETEEN HUNDRED NINETY-SIX.
  (2) AN ELECTION UNDER THIS PARAGRAPH SHALL CONTINUE TO  BE  IN  EFFECT
UNTIL REVOKED BY THE UNINCORPORATED ORGANIZATION. AN ELECTION UNDER THIS
PARAGRAPH SHALL BE REVOKED BY THE FILING OF A RETURN UNDER THIS SUBCHAP-
TER  FOR THE FIRST TAXABLE YEAR WITH RESPECT TO WHICH SUCH REVOCATION IS
TO BE EFFECTIVE. SUCH RETURN SHALL BE FILED ON OR BEFORE  THE  DUE  DATE
(DETERMINED  WITH  REGARD  TO  EXTENSIONS) FOR FILING SUCH RETURN. IN NO
EVENT SHALL SUCH ELECTION OR REVOCATION BE FOR A PART OF A TAXABLE YEAR.
  (C) NOTWITHSTANDING PARAGRAPH (A) OF THIS SUBDIVISION,  A  CORPORATION
SHALL  NOT  INCLUDE  AN  ENTITY  CLASSIFIED AS A PARTNERSHIP FOR FEDERAL
INCOME TAX PURPOSES.
  2. THE TERM "SUBSIDIARY" MEANS A CORPORATION OF WHICH OVER  FIFTY  PER
CENTUM OF THE NUMBER OF SHARES OF STOCK ENTITLING THE HOLDERS THEREOF TO
VOTE FOR THE ELECTION OF DIRECTORS OR TRUSTEES IS OWNED BY THE TAXPAYER.

S. 4610--A                          6                         A. 6721--A

  2-A.  THE  TERM  "TAXPAYER" MEANS ANY CORPORATION SUBJECT TO TAX UNDER
THIS SUBCHAPTER.
  3. INTENTIONALLY OMITTED.
  3-A.  THE  TERM  "STOCK"  MEANS  AN  INTEREST IN A CORPORATION THAT IS
TREATED AS EQUITY FOR FEDERAL INCOME TAX PURPOSES.
  4. (A) THE TERM "INVESTMENT CAPITAL" MEANS INVESTMENTS IN STOCKS THAT:
(I) SATISFY THE DEFINITION OF A CAPITAL ASSET UNDER SECTION 1221 OF  THE
INTERNAL REVENUE CODE AT ALL TIMES THE TAXPAYER OWNED SUCH STOCKS DURING
THE  TAXABLE YEAR; (II) ARE HELD BY THE TAXPAYER FOR INVESTMENT FOR MORE
THAN ONE YEAR; (III) THE DISPOSITIONS OF WHICH ARE, OR WOULD BE, TREATED
BY THE TAXPAYER AS GENERATING LONG-TERM CAPITAL GAINS  OR  LOSSES  UNDER
THE  INTERNAL REVENUE CODE; (IV) FOR STOCKS ACQUIRED ON OR AFTER JANUARY
FIRST, TWO THOUSAND FIFTEEN, AT ANY TIME AFTER THE CLOSE OF THE  DAY  IN
WHICH  THEY  ARE ACQUIRED, HAVE NEVER BEEN HELD FOR SALE TO CUSTOMERS IN
THE REGULAR COURSE OF BUSINESS; AND (V) BEFORE THE CLOSE OF THE  DAY  ON
WHICH  THE  STOCK WAS ACQUIRED, ARE CLEARLY IDENTIFIED IN THE TAXPAYER'S
RECORDS AS STOCK HELD FOR INVESTMENT IN  THE  SAME  MANNER  AS  REQUIRED
UNDER SECTION 1236(A)(1) OF THE INTERNAL REVENUE CODE FOR THE STOCK OF A
DEALER  IN SECURITIES TO BE ELIGIBLE FOR CAPITAL GAIN TREATMENT (WHETHER
OR NOT THE TAXPAYER IS A DEALER OF SECURITIES SUBJECT TO SECTION  1236),
PROVIDED,  HOWEVER,  THAT FOR STOCK ACQUIRED PRIOR TO OCTOBER FIRST, TWO
THOUSAND FIFTEEN THAT WAS NOT SUBJECT TO SECTION 1236(A) OF THE INTERNAL
REVENUE CODE, SUCH IDENTIFICATION IN THE TAXPAYER'S RECORDS  MUST  OCCUR
BEFORE  OCTOBER FIRST, TWO THOUSAND FIFTEEN. STOCK IN A CORPORATION THAT
IS CONDUCTING A UNITARY BUSINESS WITH THE TAXPAYER, STOCK  IN  A  CORPO-
RATION  THAT IS INCLUDED IN A COMBINED REPORT WITH THE TAXPAYER PURSUANT
TO THE COMMONLY OWNED GROUP ELECTION IN  SUBDIVISION  THREE  OF  SECTION
11-654.3  OF  THIS  SUBCHAPTER, AND STOCK USED BY THE TAXPAYER SHALL NOT
CONSTITUTE INVESTMENT CAPITAL. FOR PURPOSES OF THIS SUBDIVISION, IF  THE
TAXPAYER  OWNS  OR  CONTROLS,  DIRECTLY  OR INDIRECTLY, LESS THAN TWENTY
PERCENT OF THE VOTING POWER OF THE STOCK OF A CORPORATION,  THAT  CORPO-
RATION  WILL BE PRESUMED TO BE CONDUCTING A BUSINESS THAT IS NOT UNITARY
WITH THE BUSINESS OF THE TAXPAYER.
  (B) THERE SHALL BE DEDUCTED FROM INVESTMENT  CAPITAL  ANY  LIABILITIES
WHICH  ARE DIRECTLY OR INDIRECTLY ATTRIBUTABLE TO INVESTMENT CAPITAL. IF
THE AMOUNT OF THOSE LIABILITIES EXCEEDS THE AMOUNT OF  INVESTMENT  CAPI-
TAL, THE AMOUNT OF INVESTMENT CAPITAL SHALL BE ZERO.
  (C)  INVESTMENT  CAPITAL  SHALL  NOT  INCLUDE ANY SUCH INVESTMENTS THE
INCOME FROM WHICH IS EXCLUDED FROM ENTIRE NET  INCOME  PURSUANT  TO  THE
PROVISIONS  OF PARAGRAPH (C-1) OF SUBDIVISION EIGHT OF THIS SECTION, AND
THAT INVESTMENT CAPITAL SHALL BE COMPUTED WITHOUT REGARD TO  LIABILITIES
DIRECTLY OR INDIRECTLY ATTRIBUTABLE TO SUCH INVESTMENTS, BUT ONLY IF AIR
CARRIERS  ORGANIZED  IN  THE  UNITED STATES AND OPERATING IN THE FOREIGN
COUNTRY OR COUNTRIES IN WHICH THE TAXPAYER HAS ITS MAJOR BASE  OF  OPER-
ATIONS  AND  IN WHICH IT IS ORGANIZED, RESIDENT OR HEADQUARTERED (IF NOT
IN THE SAME COUNTRY AS ITS MAJOR BASE OF OPERATIONS) ARE NOT SUBJECT  TO
ANY  TAX BASED ON OR MEASURED BY CAPITAL IMPOSED BY SUCH FOREIGN COUNTRY
OR COUNTRIES OR ANY POLITICAL SUBDIVISION  THEREOF,  OR  IF  TAXED,  ARE
PROVIDED  AN EXEMPTION, EQUIVALENT TO THAT PROVIDED FOR HEREIN, FROM ANY
TAX BASED ON OR MEASURED BY CAPITAL IMPOSED BY SUCH FOREIGN  COUNTRY  OR
COUNTRIES  AND  FROM  ANY  SUCH TAX IMPOSED BY ANY POLITICAL SUBDIVISION
THEREOF.
  (D) IF A TAXPAYER ACQUIRES STOCK THAT IS A CAPITAL ASSET UNDER SECTION
1221 OF THE INTERNAL REVENUE CODE DURING THE TAXABLE YEAR AND OWNS  THAT
STOCK  ON  THE LAST DAY OF THE TAXABLE YEAR, IT WILL BE PRESUMED, SOLELY
FOR THE PURPOSES OF DETERMINING WHETHER THAT STOCK SHOULD BE  CLASSIFIED

S. 4610--A                          7                         A. 6721--A

AS  INVESTMENT CAPITAL AFTER IT IS ACQUIRED, THAT THE TAXPAYER HELD THAT
STOCK FOR MORE THAN ONE YEAR. HOWEVER, IF THE TAXPAYER DOES NOT IN  FACT
OWN THAT STOCK AT THE TIME IT ACTUALLY FILES ITS ORIGINAL REPORT FOR THE
TAXABLE YEAR IN WHICH IT ACQUIRED THE STOCK, THEN THE PRESUMPTION IN THE
PRECEDING  SENTENCE SHALL NOT APPLY AND THE ACTUAL PERIOD OF TIME DURING
WHICH THE TAXPAYER OWNED THE STOCK SHALL BE USED  TO  DETERMINE  WHETHER
THE  STOCK  SHOULD  BE  CLASSIFIED  AS  INVESTMENT  CAPITAL  AFTER IT IS
ACQUIRED. IF THE  TAXPAYER  RELIES  ON  THE  PRESUMPTION  IN  THE  FIRST
SENTENCE  OF THIS PARAGRAPH BUT DOES NOT OWN THE STOCK FOR MORE THAN ONE
YEAR, THE TAXPAYER MUST INCREASE ITS TOTAL BUSINESS CAPITAL IN THE IMME-
DIATELY SUCCEEDING TAXABLE YEAR BY THE  AMOUNT  INCLUDED  IN  INVESTMENT
CAPITAL  FOR  THAT  STOCK,  NET  OF ANY LIABILITIES ATTRIBUTABLE TO THAT
STOCK COMPUTED AS PROVIDED IN PARAGRAPH (B) OF THIS SUBDIVISION AND MUST
INCREASE ITS BUSINESS INCOME IN THE IMMEDIATELY SUCCEEDING TAXABLE  YEAR
BY THE AMOUNT OF INCOME AND NET GAINS (BUT NOT LESS THAN ZERO) FROM THAT
STOCK  INCLUDED  IN  INVESTMENT  INCOME,  LESS  ANY  INTEREST DEDUCTIONS
DIRECTLY OR INDIRECTLY ATTRIBUTABLE TO THAT STOCK, AS PROVIDED IN SUBDI-
VISION FIVE OF THIS SECTION.
  (E) WHEN INCOME OR GAIN FROM  A  DEBT  OBLIGATION  OR  OTHER  SECURITY
CANNOT BE ALLOCATED TO THE CITY USING THE BUSINESS ALLOCATION PERCENTAGE
AS  A  RESULT  OF  THE UNITED STATES CONSTITUTIONAL PRINCIPLES, THE DEBT
OBLIGATION OR OTHER SECURITY WILL BE INCLUDED IN INVESTMENT CAPITAL.
  5.  (A)(I) THE TERM "INVESTMENT INCOME" MEANS INCOME, INCLUDING  CAPI-
TAL  GAINS  IN EXCESS OF CAPITAL LOSSES, FROM INVESTMENT CAPITAL, TO THE
EXTENT INCLUDED IN COMPUTING ENTIRE NET INCOME, LESS, IN THE  DISCRETION
OF  THE  COMMISSIONER  OF  FINANCE, ANY INTEREST DEDUCTIONS ALLOWABLE IN
COMPUTING ENTIRE NET INCOME WHICH ARE DIRECTLY OR  INDIRECTLY  ATTRIBUT-
ABLE TO INVESTMENT CAPITAL OR INVESTMENT INCOME, PROVIDED, HOWEVER, THAT
IN NO CASE SHALL INVESTMENT INCOME EXCEED ENTIRE NET INCOME.
  (II)  IF  THE  AMOUNT OF INTEREST DEDUCTIONS SUBTRACTED UNDER SUBPARA-
GRAPH (I) OF THIS PARAGRAPH EXCEEDS INVESTMENT  INCOME,  THE  EXCESS  OF
SUCH  AMOUNT  OVER  INVESTMENT  INCOME  MUST BE ADDED BACK TO ENTIRE NET
INCOME.
  (III) IF THE TAXPAYER'S INVESTMENT INCOME DETERMINED WITHOUT REGARD TO
THE INTEREST DEDUCTIONS SUBTRACTED UNDER SUBPARAGRAPH (I) OF THIS  PARA-
GRAPH  COMPRISES  MORE  THAN  EIGHT PERCENT OF THE TAXPAYER'S ENTIRE NET
INCOME, INVESTMENT INCOME DETERMINED WITHOUT  REGARD  TO  SUCH  INTEREST
DEDUCTIONS  CANNOT  EXCEED  EIGHT  PERCENT  OF THE TAXPAYER'S ENTIRE NET
INCOME.
  (B) IN LIEU OF SUBTRACTING FROM INVESTMENT INCOME THE AMOUNT OF  THOSE
INTEREST  DEDUCTIONS,  THE  TAXPAYER  MAY  MAKE  A REVOCABLE ELECTION TO
REDUCE ITS TOTAL INVESTMENT INCOME, DETERMINED AFTER APPLYING THE  LIMI-
TATION  IN  SUBPARAGRAPH  (III) OF PARAGRAPH (A) OF THIS SUBDIVISION, BY
FORTY PERCENT. IF THE TAXPAYER MAKES THIS ELECTION,  THE  TAXPAYER  MUST
ALSO MAKE THE ELECTIONS PROVIDED FOR IN PARAGRAPHS (B) AND (C) OF SUBDI-
VISION FIVE-A OF THIS SECTION. IF THE TAXPAYER SUBSEQUENTLY REVOKES THIS
ELECTION,  THE  TAXPAYER MUST REVOKE THE ELECTIONS PROVIDED FOR IN PARA-
GRAPHS (B) AND (C) OF SUBDIVISION FIVE-A OF  THIS  SECTION.  A  TAXPAYER
THAT  DOES  NOT  MAKE THIS ELECTION BECAUSE IT HAS NO INVESTMENT CAPITAL
WILL NOT BE PRECLUDED FROM MAKING THOSE OTHER ELECTIONS.
  (C) INVESTMENT INCOME SHALL NOT INCLUDE ANY AMOUNT  TREATED  AS  DIVI-
DENDS PURSUANT TO SECTION SEVENTY-EIGHT OF THE INTERNAL REVENUE CODE.
  5-A.  (A)  THE  TERM "OTHER EXEMPT INCOME" MEANS THE SUM OF EXEMPT CFC
INCOME AND EXEMPT UNITARY CORPORATION DIVIDENDS.
  (B) "EXEMPT CFC INCOME" MEANS THE INCOME REQUIRED TO  BE  INCLUDED  IN
THE  TAXPAYER'S  FEDERAL  GROSS  INCOME  PURSUANT  TO  SUBSECTION (A) OF

S. 4610--A                          8                         A. 6721--A

SECTION NINE HUNDRED FIFTY-ONE OF THE INTERNAL  REVENUE  CODE,  RECEIVED
FROM  A  CORPORATION  THAT  IS  CONDUCTING  A  UNITARY BUSINESS WITH THE
TAXPAYER BUT IS NOT INCLUDED IN A COMBINED  REPORT  WITH  THE  TAXPAYER,
LESS,  IN  THE  DISCRETION  OF THE COMMISSIONER OF FINANCE, ANY INTEREST
DEDUCTIONS DIRECTLY OR INDIRECTLY ATTRIBUTABLE TO THAT INCOME.  IN  LIEU
OF  SUBTRACTING  FROM ITS EXEMPT CFC INCOME THE AMOUNT OF THOSE INTEREST
DEDUCTIONS, THE TAXPAYER MAY MAKE A REVOCABLE  ELECTION  TO  REDUCE  ITS
TOTAL  EXEMPT  CFC  INCOME  BY FORTY PERCENT. IF THE TAXPAYER MAKES THIS
ELECTION, THE TAXPAYER MUST ALSO MAKE  THE  ELECTIONS  PROVIDED  FOR  IN
PARAGRAPH  (B)  OF SUBDIVISION FIVE OF THIS SECTION AND PARAGRAPH (C) OF
THIS SUBDIVISION. IF THE TAXPAYER SUBSEQUENTLY  REVOKES  THIS  ELECTION,
THE  TAXPAYER MUST REVOKE THE ELECTIONS PROVIDED FOR IN PARAGRAPH (B) OF
SUBDIVISION FIVE OF THIS SECTION AND PARAGRAPH (C) OF THIS  SUBDIVISION.
A  TAXPAYER  WHICH  DOES NOT MAKE THIS ELECTION BECAUSE IT HAS NO EXEMPT
CFC INCOME WILL NOT BE PRECLUDED FROM MAKING THOSE OTHER ELECTIONS.
  (C) "EXEMPT UNITARY CORPORATE DIVIDENDS" MEANS THOSE DIVIDENDS FROM  A
CORPORATION  THAT IS CONDUCTING A UNITARY BUSINESS WITH THE TAXPAYER BUT
IS NOT INCLUDED IN A COMBINED REPORT WITH THE  TAXPAYER,  LESS,  IN  THE
DISCRETION  OF  THE  COMMISSIONER  OF  FINANCE,  ANY INTEREST DEDUCTIONS
DIRECTLY OR INDIRECTLY ATTRIBUTABLE TO SUCH INCOME. OTHER THAN  DIVIDEND
INCOME  RECEIVED FROM CORPORATIONS THAT ARE TAXABLE UNDER CHAPTER ELEVEN
OF THIS TITLE (EXCEPT FOR VENDORS OF  UTILITY  SERVICES  THAT  ARE  ALSO
TAXABLE  UNDER THIS SUBCHAPTER) OR WOULD BE TAXABLE UNDER CHAPTER ELEVEN
OF THIS TITLE (EXCEPT FOR VENDORS OF  UTILITY  SERVICES  THAT  ARE  ALSO
TAXABLE  UNDER  THIS SUBCHAPTER) IF SUBJECT TO TAX AND CORPORATIONS THAT
WOULD HAVE BEEN TAXABLE AS INSURANCE CORPORATIONS UNDER FORMER PART  IV,
TITLE R, CHAPTER FORTY-SIX OF THE ADMINISTRATIVE CODE OF THE CITY OF NEW
YORK  AS  IN EFFECT ON JUNE THIRTIETH, NINETEEN HUNDRED SEVENTY-FOUR, IN
LIEU OF SUBTRACTING FROM THIS DIVIDEND INCOME THOSE INTEREST DEDUCTIONS,
THE TAXPAYER MAY MAKE A REVOCABLE ELECTION TO REDUCE THE TOTAL AMOUNT OF
THIS DIVIDEND INCOME BY  FORTY  PERCENT.  IF  THE  TAXPAYER  MAKES  THIS
ELECTION,  THE  TAXPAYER  MUST  ALSO  MAKE THE ELECTIONS PROVIDED FOR IN
PARAGRAPH (B) OF SUBDIVISION FIVE OF THIS SECTION AND PARAGRAPH  (B)  OF
THIS  SUBDIVISION.   IF THE TAXPAYER SUBSEQUENTLY REVOKES THIS ELECTION,
THE TAXPAYER MUST REVOKE THE ELECTIONS PROVIDED FOR IN PARAGRAPH (B)  OF
SUBDIVISION  FIVE OF THIS SECTION AND PARAGRAPH (B) OF THIS SUBDIVISION.
A TAXPAYER THAT DOES NOT MAKE THIS ELECTION BECAUSE IT HAS NOT  RECEIVED
ANY  EXEMPT  UNITARY  CORPORATION  DIVIDENDS OR IS PRECLUDED FROM MAKING
THIS ELECTION FOR DIVIDENDS RECEIVED FROM CORPORATIONS THAT ARE  TAXABLE
UNDER  CHAPTER  ELEVEN  OF  THIS  TITLE  (EXCEPT  FOR VENDORS OF UTILITY
SERVICES THAT ARE ALSO TAXABLE UNDER THIS SUBCHAPTER) OR WOULD BE  TAXA-
BLE  UNDER  CHAPTER  ELEVEN  OF THIS TITLE IF SUBJECT TO TAX (EXCEPT FOR
VENDORS OF UTILITY SERVICES THAT ARE ALSO TAXABLE UNDER THIS SUBCHAPTER)
SHALL NOT BE PRECLUDED FROM MAKING THOSE OTHER ELECTIONS.
  (D) IF THE TAXPAYER ATTRIBUTES INTEREST  DEDUCTIONS  TO  OTHER  EXEMPT
INCOME  AND  THE AMOUNT DEDUCTED EXCEEDS OTHER EXEMPT INCOME, THE EXCESS
OF THE INTEREST DEDUCTIONS OVER OTHER EXEMPT INCOME MUST BE  ADDED  BACK
TO ENTIRE NET INCOME. IN NO CASE SHALL OTHER EXEMPT INCOME EXCEED ENTIRE
NET INCOME.
  (E)  OTHER EXEMPT INCOME SHALL NOT INCLUDE ANY AMOUNT TREATED AS DIVI-
DENDS PURSUANT TO SECTION SEVENTY-EIGHT OF THE INTERNAL REVENUE CODE.
  6. (A) THE TERM  "BUSINESS  CAPITAL"  MEANS  ALL  ASSETS,  OTHER  THAN
INVESTMENT  CAPITAL  AND  STOCK ISSUED BY THE TAXPAYER, LESS LIABILITIES
NOT DEDUCTED FROM INVESTMENT CAPITAL; PROVIDED, HOWEVER, BUSINESS  CAPI-
TAL SHALL INCLUDE ONLY THOSE ASSETS THE INCOME, LOSS OR EXPENSE OF WHICH
ARE  PROPERLY  REFLECTED  (OR  WOULD HAVE BEEN PROPERLY REFLECTED IF NOT

S. 4610--A                          9                         A. 6721--A

FULLY DEPRECIATED OR EXPENSED OR DEPRECIATED OR EXPENSED  TO  A  NOMINAL
AMOUNT) IN THE COMPUTATION OF ENTIRE NET INCOME FOR THE TAXABLE YEAR.
  (B)  PROVIDED, FURTHER, "BUSINESS CAPITAL" SHALL NOT INCLUDE ASSETS TO
THE EXTENT EMPLOYED FOR  THE  PURPOSE  OF  GENERATING  INCOME  WHICH  IS
EXCLUDED  FROM ENTIRE NET INCOME PURSUANT TO THE PROVISIONS OF PARAGRAPH
(C-1) OF SUBDIVISION EIGHT OF THIS SECTION AND SHALL BE COMPUTED WITHOUT
REGARD TO  LIABILITIES  DIRECTLY  OR  INDIRECTLY  ATTRIBUTABLE  TO  SUCH
ASSETS,  BUT  ONLY  IF  AIR  CARRIERS ORGANIZED IN THE UNITED STATES AND
OPERATING IN THE FOREIGN COUNTRY OR COUNTRIES IN WHICH THE TAXPAYER  HAS
ITS  MAJOR  BASE OF OPERATIONS AND IN WHICH IT IS ORGANIZED, RESIDENT OR
HEADQUARTERED (IF NOT IN THE SAME COUNTRY AS ITS  MAJOR  BASE  OF  OPER-
ATIONS)  ARE  NOT  SUBJECT  TO  ANY  TAX BASED ON OR MEASURED BY CAPITAL
IMPOSED BY SUCH FOREIGN COUNTRY OR COUNTRIES OR ANY  POLITICAL  SUBDIVI-
SION THEREOF, OR IF TAXED, ARE PROVIDED AN EXEMPTION, EQUIVALENT TO THAT
PROVIDED  FOR  HEREIN,  FROM  ANY  TAX  BASED  ON OR MEASURED BY CAPITAL
IMPOSED BY SUCH FOREIGN COUNTRY OR  COUNTRIES  AND  FROM  ANY  SUCH  TAX
IMPOSED BY ANY POLITICAL SUBDIVISION THEREOF.
  7. THE TERM "BUSINESS INCOME" MEANS ENTIRE NET INCOME MINUS INVESTMENT
INCOME  AND OTHER EXEMPT INCOME. IN NO EVENT SHALL THE SUM OF INVESTMENT
INCOME AND OTHER EXEMPT INCOME EXCEED ENTIRE NET INCOME. IF THE TAXPAYER
MAKES THE ELECTION PROVIDED FOR IN SUBPARAGRAPH ONE OF PARAGRAPH (A)  OF
SUBDIVISION FIVE OF SECTION 11-654.2 OF THIS SUBCHAPTER, THEN ALL INCOME
FROM QUALIFIED FINANCIAL INSTRUMENTS SHALL CONSTITUTE BUSINESS INCOME.
  8. THE TERM "ENTIRE NET INCOME" MEANS TOTAL NET INCOME FROM ALL SOURC-
ES,  WHICH  SHALL  BE  PRESUMABLY THE SAME AS THE ENTIRE TAXABLE INCOME,
WHICH, EXCEPT AS HEREAFTER PROVIDED IN THIS SUBDIVISION,
  (I) THE TAXPAYER IS REQUIRED TO REPORT TO THE UNITED  STATES  TREASURY
DEPARTMENT, OR
  (II)  THE  TAXPAYER,  IN THE CASE OF A CORPORATION THAT IS EXEMPT FROM
FEDERAL INCOME TAX (OTHER THAN THE TAX  ON  UNRELATED  BUSINESS  TAXABLE
INCOME IMPOSED UNDER SECTION FIVE HUNDRED ELEVEN OF THE INTERNAL REVENUE
CODE) BUT WHICH IS SUBJECT TO TAX UNDER THIS SUBCHAPTER, WOULD HAVE BEEN
REQUIRED TO REPORT TO THE UNITED STATES TREASURY DEPARTMENT BUT FOR SUCH
EXEMPTION, OR
  (III)  IN THE CASE OF AN ALIEN CORPORATION THAT UNDER ANY PROVISION OF
THE INTERNAL REVENUE CODE IS NOT TREATED AS A "DOMESTIC CORPORATION"  AS
DEFINED  IN  SECTION  SEVEN  THOUSAND SEVEN HUNDRED ONE OF SUCH CODE, IS
EFFECTIVELY CONNECTED WITH THE CONDUCT OF A TRADE OR BUSINESS WITHIN THE
UNITED STATES AS DETERMINED UNDER SECTION EIGHT  HUNDRED  EIGHTY-TWO  OF
THE INTERNAL REVENUE CODE.
  (A) ENTIRE NET INCOME SHALL NOT INCLUDE:
  (1) INTENTIONALLY OMITTED;
  (2) INTENTIONALLY OMITTED;
  (2-A)   ANY   AMOUNTS   TREATED   AS  DIVIDENDS  PURSUANT  TO  SECTION
SEVENTY-EIGHT OF THE INTERNAL REVENUE CODE;
  (3) BONA FIDE GIFTS;
  (4) INCOME AND DEDUCTIONS WITH RESPECT TO AMOUNTS RECEIVED FROM SCHOOL
DISTRICTS AND FROM CORPORATIONS AND ASSOCIATIONS, ORGANIZED AND OPERATED
EXCLUSIVELY FOR RELIGIOUS, CHARITABLE OR EDUCATIONAL PURPOSES,  NO  PART
OF THE NET EARNINGS OF WHICH INURES TO THE BENEFIT OF ANY PRIVATE SHARE-
HOLDER OR INDIVIDUAL, FOR THE OPERATION OF SCHOOL BUSES;
  (5)  ANY  REFUND  OR  CREDIT  OF  A TAX IMPOSED UNDER THIS CHAPTER, OR
IMPOSED BY ARTICLE NINE, NINE-A, TWENTY-THREE, OR FORMER  ARTICLE  THIR-
TY-TWO  OF  THE  TAX  LAW,  FOR  WHICH TAX NO EXCLUSION OR DEDUCTION WAS
ALLOWED IN DETERMINING THE  TAXPAYER'S  ENTIRE  NET  INCOME  UNDER  THIS

S. 4610--A                         10                         A. 6721--A

SUBCHAPTER,  SUBCHAPTER TWO, OR SUBCHAPTER THREE OF THIS CHAPTER FOR ANY
PRIOR YEAR;
  (6) INTENTIONALLY OMITTED;
  (7)  THAT PORTION OF WAGES AND SALARIES PAID OR INCURRED FOR THE TAXA-
BLE YEAR FOR WHICH A DEDUCTION IS NOT ALLOWED PURSUANT TO THE PROVISIONS
OF SECTION TWO HUNDRED EIGHTY C OF THE INTERNAL REVENUE CODE;
  (8) EXCEPT WITH RESPECT TO PROPERTY WHICH IS A QUALIFIED MASS  COMMUT-
ING  VEHICLE  DESCRIBED  IN  SUBPARAGRAPH  (D)  OF  PARAGRAPH  EIGHT  OF
SUBSECTION (F) OF SECTION ONE HUNDRED SIXTY-EIGHT OF THE INTERNAL REVEN-
UE CODE (RELATING TO QUALIFIED MASS COMMUTING VEHICLES) AND PROPERTY  OF
A TAXPAYER PRINCIPALLY ENGAGED IN THE CONDUCT OF AN AVIATION, STEAMBOAT,
FERRY  OR  NAVIGATION BUSINESS, OR TWO OR MORE OF SUCH BUSINESSES, WHICH
IS PLACED IN SERVICE BEFORE TAXABLE YEARS BEGINNING IN NINETEEN  HUNDRED
EIGHTY-NINE,  ANY  AMOUNT  WHICH  IS  INCLUDED IN THE TAXPAYER'S FEDERAL
TAXABLE INCOME SOLELY AS A RESULT OF AN ELECTION MADE  PURSUANT  TO  THE
PROVISIONS  OF  SUCH  PARAGRAPH EIGHT AS IT WAS IN EFFECT FOR AGREEMENTS
ENTERED INTO PRIOR TO JANUARY FIRST, NINETEEN HUNDRED EIGHTY-FOUR;
  (9) EXCEPT WITH RESPECT TO PROPERTY WHICH IS A QUALIFIED MASS  COMMUT-
ING  VEHICLE  DESCRIBED  IN  SUBPARAGRAPH  (D)  OF  PARAGRAPH  EIGHT  OF
SUBSECTION (F) OF SECTION ONE HUNDRED SIXTY-EIGHT OF THE INTERNAL REVEN-
UE CODE (RELATING TO QUALIFIED MASS COMMUTING VEHICLES) AND PROPERTY  OF
A TAXPAYER PRINCIPALLY ENGAGED IN THE CONDUCT OF AN AVIATION, STEAMBOAT,
FERRY  OR  NAVIGATION BUSINESS, OR TWO OR MORE OF SUCH BUSINESSES, WHICH
IS PLACED IN SERVICE BEFORE TAXABLE YEARS BEGINNING IN NINETEEN  HUNDRED
EIGHTY-NINE,  ANY  AMOUNT  WHICH  THE  TAXPAYER COULD HAVE EXCLUDED FROM
FEDERAL TAXABLE INCOME HAD IT NOT MADE THE ELECTION PROVIDED FOR IN SUCH
PARAGRAPH EIGHT AS IT WAS IN EFFECT FOR AGREEMENTS ENTERED INTO PRIOR TO
JANUARY FIRST, NINETEEN HUNDRED EIGHTY-FOUR;
  (10) THE AMOUNT DEDUCTIBLE PURSUANT TO PARAGRAPH (J) OF THIS  SUBDIVI-
SION;
  (11)  UPON  THE DISPOSITION OF PROPERTY TO WHICH PARAGRAPH (J) OF THIS
SUBDIVISION APPLIES, THE AMOUNT, IF ANY, BY WHICH THE AGGREGATE  OF  THE
AMOUNTS DESCRIBED IN SUBPARAGRAPH ELEVEN OF PARAGRAPH (B) OF THIS SUBDI-
VISION  ATTRIBUTABLE  TO  SUCH  PROPERTY  EXCEEDS  THE  AGGREGATE OF THE
AMOUNTS DESCRIBED IN PARAGRAPH (J) OF THIS SUBDIVISION  ATTRIBUTABLE  TO
SUCH PROPERTY;
  (12)  THE AMOUNT DEDUCTIBLE PURSUANT TO PARAGRAPH (K) OF THIS SUBDIVI-
SION;
  (13) THE AMOUNT DEDUCTIBLE PURSUANT TO PARAGRAPH (O) OF THIS  SUBDIVI-
SION;
  (14) THE AMOUNT COMPUTED PURSUANT TO PARAGRAPH (Q), (R) OR (S) OF THIS
SUBDIVISION,  BUT  ONLY  THE  AMOUNT  DETERMINED PURSUANT TO ONE OF SUCH
PARAGRAPHS; AND
  (15) THE AMOUNT COMPUTED PURSUANT TO PARAGRAPH (T)  OF  THIS  SUBDIVI-
SION.
  (A-1)  NOTWITHSTANDING  ANY OTHER PROVISION OF THIS SUBCHAPTER, IN THE
CASE OF A TAXPAYER THAT IS A PARTNER IN A PARTNERSHIP SUBJECT TO THE TAX
IMPOSED BY CHAPTER ELEVEN OF THIS TITLE AS  A  UTILITY,  AS  DEFINED  IN
SUBDIVISION  SIX  OF  SECTION 11-1101 OF SUCH CHAPTER, ENTIRE NET INCOME
SHALL NOT INCLUDE THE TAXPAYER'S DISTRIBUTIVE  OR  PRO  RATA  SHARE  FOR
FEDERAL  INCOME  TAX  PURPOSES  OF  ANY  ITEM  OF  INCOME, GAIN, LOSS OR
DEDUCTION OF SUCH PARTNERSHIP, OR ANY ITEM  OF  INCOME,  GAIN,  LOSS  OR
DEDUCTION OF SUCH PARTNERSHIP THAT THE TAXPAYER IS REQUIRED TO TAKE INTO
ACCOUNT SEPARATELY FOR FEDERAL INCOME TAX PURPOSES.
  (B)  ENTIRE  NET  INCOME  SHALL  BE  DETERMINED WITHOUT THE EXCLUSION,
DEDUCTION OR CREDIT OF:

S. 4610--A                         11                         A. 6721--A

  (1) IN THE CASE OF AN ALIEN CORPORATION THAT UNDER  ANY  PROVISION  OF
THE  INTERNAL REVENUE CODE IS NOT TREATED AS A "DOMESTIC CORPORATION" AS
DEFINED IN SECTION SEVEN THOUSAND SEVEN HUNDRED ONE OF  SUCH  CODE,  (I)
ANY  PART OF ANY INCOME FROM DIVIDENDS OR INTEREST ON ANY KIND OF STOCK,
SECURITIES OR INDEBTEDNESS, BUT ONLY IF SUCH INCOME IS TREATED AS EFFEC-
TIVELY  CONNECTED  WITH THE CONDUCT OF A TRADE OR BUSINESS IN THE UNITED
STATES PURSUANT TO SECTION EIGHT  HUNDRED  SIXTY-FOUR  OF  THE  INTERNAL
REVENUE  CODE,  (II) ANY INCOME EXEMPT FROM FEDERAL TAXABLE INCOME UNDER
ANY TREATY OBLIGATION OF THE UNITED STATES,  BUT  ONLY  IF  SUCH  INCOME
WOULD  BE  TREATED  AS  EFFECTIVELY  CONNECTED  IN  THE  ABSENCE OF SUCH
EXEMPTION PROVIDED THAT SUCH TREATY OBLIGATION  DOES  NOT  PRECLUDE  THE
TAXATION  OF  SUCH INCOME BY A STATE, OR (III) ANY INCOME WHICH WOULD BE
TREATED AS EFFECTIVELY CONNECTED IF SUCH INCOME WERE NOT  EXCLUDED  FROM
GROSS  INCOME PURSUANT TO SUBSECTION (A) OF SECTION ONE HUNDRED THREE OF
THE INTERNAL REVENUE CODE;
  (2) ANY PART OF ANY INCOME FROM DIVIDENDS OR INTEREST OF ANY  KIND  OF
STOCK, SECURITIES, OR INDEBTEDNESS;
  (3)  TAXES  ON OR MEASURED BY PROFITS OR INCOME PAID OR ACCRUED TO THE
UNITED STATES, ANY OF ITS  POSSESSIONS,  TERRITORIES  OR  COMMONWEALTHS,
INCLUDING TAXES IN LIEU OF ANY OF THE FOREGOING TAXES OTHERWISE GENERAL-
LY  IMPOSED  BY  ANY POSSESSION, TERRITORY OR COMMONWEALTH OF THE UNITED
STATES, OR TAXES PAID OR  ACCRUED  TO  THE  STATE  UNDER  ARTICLE  NINE,
NINE-A, THIRTEEN-A OR THIRTY-TWO OF THE TAX LAW AS IN EFFECT ON DECEMBER
THIRTY-FIRST, TWO THOUSAND FOURTEEN;
  (3-A)  TAXES  ON  OR  MEASURED  BY PROFITS OR INCOME, OR WHICH INCLUDE
PROFITS OR INCOME AS A MEASURE, PAID OR ACCRUED TO ANY  OTHER  STATE  OF
THE  UNITED  STATES,  OR  ANY  POLITICAL  SUBDIVISION THEREOF, OR TO THE
DISTRICT OF COLUMBIA, INCLUDING TAXES EXPRESSLY IN LIEU OF  ANY  OF  THE
FOREGOING  TAXES  OTHERWISE  GENERALLY IMPOSED BY ANY OTHER STATE OF THE
UNITED STATES, OR ANY POLITICAL SUBDIVISION THEREOF, OR THE DISTRICT  OF
COLUMBIA;
  (4) TAXES IMPOSED UNDER THIS CHAPTER;
  (4-A) INTENTIONALLY OMITTED;
  (4-B) THE AMOUNT ALLOWED AS AN EXCLUSION OR A DEDUCTION IMPOSED BY THE
TAX  LAW  IN  DETERMINING  THE  ENTIRE  TAXABLE  INCOME FOR A RELOCATION
DESCRIBED IN SUBDIVISION THIRTEEN OF SECTION 11-654 OF  THIS  SUBCHAPTER
WHICH  THE  TAXPAYER IS REQUIRED TO REPORT TO THE UNITED STATES TREASURY
DEPARTMENT BUT ONLY SUCH PORTION OF SUCH EXCLUSION OR DEDUCTION WHICH IS
NOT IN EXCESS OF THE AMOUNT OF THE CREDIT ALLOWED PURSUANT  TO  SUBDIVI-
SION THIRTEEN OF SECTION 11-654 OF THIS SUBCHAPTER;
  (4-C) THE AMOUNT ALLOWED AS AN EXCLUSION OR A DEDUCTION IMPOSED BY THE
TAX  LAW  FOR  A RELOCATION DESCRIBED IN SUBDIVISION FOURTEEN OF SECTION
11-654 OF THIS SUBCHAPTER IN DETERMINING THE ENTIRE TAXABLE INCOME WHICH
THE TAXPAYER IS REQUIRED TO REPORT TO THE UNITED STATES TREASURY DEPART-
MENT BUT ONLY SUCH PORTION OF SUCH EXCLUSION OR DEDUCTION WHICH  IS  NOT
IN  EXCESS  OF  THE AMOUNT OF THE CREDIT ALLOWED PURSUANT TO SUBDIVISION
FOURTEEN OF SECTION 11-654 OF THIS SUBCHAPTER;
  (4-D) INTENTIONALLY OMITTED;
  (4-E) INTENTIONALLY OMITTED;
  (5) INTENTIONALLY OMITTED;
  (6) ANY AMOUNT ALLOWED AS A  DEDUCTION  FOR  THE  TAXABLE  YEAR  UNDER
SECTION  ONE HUNDRED SEVENTY-TWO OF THE INTERNAL REVENUE CODE, INCLUDING
CARRYOVERS OF DEDUCTIONS FROM PRIOR TAXABLE YEARS;
  (7) ANY AMOUNT BY REASON OF THE GRANTING, ISSUING  OR  ASSUMING  OF  A
RESTRICTED  STOCK  OPTION,  AS  DEFINED  IN THE INTERNAL REVENUE CODE OF
NINETEEN HUNDRED FIFTY-FOUR, OR BY REASON OF THE TRANSFER OF  THE  SHARE

S. 4610--A                         12                         A. 6721--A

OF  STOCK UPON THE EXERCISE OF THE OPTION, UNLESS SUCH SHARE IS DISPOSED
OF BY THE GRANTEE OF THE OPTION WITHIN TWO YEARS FROM THE  DATE  OF  THE
GRANTING  OF  THE OPTION OR WITHIN SIX MONTHS AFTER THE TRANSFER OF SUCH
SHARE TO THE GRANTEE;
  (8) INTENTIONALLY OMITTED;
  (9)  EXCEPT WITH RESPECT TO PROPERTY WHICH IS A QUALIFIED MASS COMMUT-
ING  VEHICLE  DESCRIBED  IN  SUBPARAGRAPH  (D)  OF  PARAGRAPH  EIGHT  OF
SUBSECTION (F) OF SECTION ONE HUNDRED SIXTY-EIGHT OF THE INTERNAL REVEN-
UE  CODE (RELATING TO QUALIFIED MASS COMMUTING VEHICLES) AND PROPERTY OF
A TAXPAYER PRINCIPALLY ENGAGED IN THE CONDUCT OF AN AVIATION, STEAMBOAT,
FERRY OR NAVIGATION BUSINESS, OR TWO OR MORE OF SUCH  BUSINESSES,  WHICH
IS  PLACED IN SERVICE BEFORE TAXABLE YEARS BEGINNING IN NINETEEN HUNDRED
EIGHTY-NINE, ANY AMOUNT WHICH THE TAXPAYER CLAIMED  AS  A  DEDUCTION  IN
COMPUTING  ITS  FEDERAL TAXABLE INCOME SOLELY AS A RESULT OF AN ELECTION
MADE PURSUANT TO THE PROVISIONS OF SUCH PARAGRAPH EIGHT  AS  IT  WAS  IN
EFFECT  FOR  AGREEMENTS  ENTERED  INTO  PRIOR TO JANUARY FIRST, NINETEEN
HUNDRED EIGHTY-FOUR;
  (10) EXCEPT WITH RESPECT TO PROPERTY WHICH IS A QUALIFIED MASS COMMUT-
ING  VEHICLE  DESCRIBED  IN  SUBPARAGRAPH  (D)  OF  PARAGRAPH  EIGHT  OF
SUBSECTION (F) OF SECTION ONE HUNDRED SIXTY-EIGHT OF THE INTERNAL REVEN-
UE  CODE (RELATING TO QUALIFIED MASS COMMUTING VEHICLES) AND PROPERTY OF
A TAXPAYER PRINCIPALLY ENGAGED IN THE CONDUCT OF AN AVIATION, STEAMBOAT,
FERRY OR NAVIGATION BUSINESS, OR TWO OR MORE OF SUCH  BUSINESSES,  WHICH
IS  PLACED IN SERVICE BEFORE TAXABLE YEARS BEGINNING IN NINETEEN HUNDRED
EIGHTY-NINE, ANY AMOUNT WHICH THE TAXPAYER WOULD HAVE BEEN  REQUIRED  TO
INCLUDE IN THE COMPUTATION OF ITS FEDERAL TAXABLE INCOME HAD IT NOT MADE
THE  ELECTION  PERMITTED  PURSUANT  TO SUCH PARAGRAPH EIGHT AS IT WAS IN
EFFECT FOR AGREEMENTS ENTERED INTO  PRIOR  TO  JANUARY  FIRST,  NINETEEN
HUNDRED EIGHTY-FOUR;
  (11) IN THE CASE OF PROPERTY PLACED IN SERVICE IN TAXABLE YEARS BEGIN-
NING  BEFORE  NINETEEN  HUNDRED NINETY-FOUR, FOR TAXABLE YEARS BEGINNING
AFTER DECEMBER THIRTY-FIRST, NINETEEN HUNDRED  EIGHTY-ONE,  EXCEPT  WITH
RESPECT  TO  PROPERTY  SUBJECT  TO THE PROVISIONS OF SECTION TWO HUNDRED
EIGHTY  F  OF  THE  INTERNAL  REVENUE  CODE,  PROPERTY  SUBJECT  TO  THE
PROVISIONS  OF  SECTION  ONE HUNDRED SIXTY-EIGHT OF THE INTERNAL REVENUE
CODE WHICH IS PLACED IN SERVICE IN THIS STATE IN TAXABLE YEARS BEGINNING
AFTER DECEMBER THIRTY-FIRST, NINETEEN HUNDRED EIGHTY-FOUR  AND  PROPERTY
OF  A TAXPAYER PRINCIPALLY ENGAGED IN THE CONDUCT OF AN AVIATION, STEAM-
BOAT, FERRY OR NAVIGATION BUSINESS, OR TWO OR MORE OF  SUCH  BUSINESSES,
WHICH  IS  PLACED  IN SERVICE BEFORE TAXABLE YEARS BEGINNING IN NINETEEN
HUNDRED EIGHTY-NINE, THE AMOUNT  ALLOWABLE  AS  A  DEDUCTION  DETERMINED
UNDER SECTION ONE HUNDRED SIXTY-EIGHT OF THE INTERNAL REVENUE CODE;
  (12)  UPON  THE DISPOSITION OF PROPERTY TO WHICH PARAGRAPH (J) OF THIS
SUBDIVISION APPLIES, THE AMOUNT, IF ANY, BY WHICH THE AGGREGATE  OF  THE
AMOUNTS  DESCRIBED  IN  SUCH PARAGRAPH (J) ATTRIBUTABLE TO SUCH PROPERTY
EXCEEDS THE AGGREGATE OF THE AMOUNTS DESCRIBED IN SUBPARAGRAPH ELEVEN OF
THIS PARAGRAPH ATTRIBUTABLE TO SUCH PROPERTY;
  (13) INTENTIONALLY OMITTED;
  (14) INTENTIONALLY OMITTED;
  (15) INTENTIONALLY OMITTED;
  (16) IN THE CASE OF QUALIFIED PROPERTY DESCRIBED IN PARAGRAPH  TWO  OF
SUBSECTION (K) OF SECTION ONE HUNDRED SIXTY-EIGHT OF THE INTERNAL REVEN-
UE  CODE,  OTHER  THAN  QUALIFIED  RESURGENCE ZONE PROPERTY DESCRIBED IN
PARAGRAPH (M) OF THIS SUBDIVISION, AND OTHER  THAN  QUALIFIED  NEW  YORK
LIBERTY  ZONE  PROPERTY  DESCRIBED IN PARAGRAPH TWO OF SUBSECTION (B) OF
SECTION FOURTEEN HUNDRED L OF THE INTERNAL REVENUE CODE (WITHOUT  REGARD

S. 4610--A                         13                         A. 6721--A

TO  CLAUSE (I) OF SUBPARAGRAPH (C) OF SUCH PARAGRAPH), THE AMOUNT ALLOW-
ABLE AS A DEDUCTION UNDER SECTION ONE HUNDRED SIXTY-SEVEN OF THE  INTER-
NAL REVENUE CODE;
  (17)  IN  THE  CASE  OF  A  TAXPAYER THAT IS NOT AN ELIGIBLE FARMER AS
DEFINED IN SUBSECTION (N) OF SECTION SIX HUNDRED SIX OF THE TAX LAW, THE
AMOUNT ALLOWABLE AS A DEDUCTION UNDER SECTIONS ONE HUNDRED SEVENTY-NINE,
ONE HUNDRED SIXTY-SEVEN AND ONE  HUNDRED  SIXTY-EIGHT  OF  THE  INTERNAL
REVENUE  CODE  WITH  RESPECT  TO  A  SPORT UTILITY VEHICLE THAT IS NOT A
PASSENGER AUTOMOBILE AS DEFINED IN PARAGRAPH FIVE OF SUBSECTION  (D)  OF
SECTION TWO HUNDRED EIGHTY F OF THE INTERNAL REVENUE CODE;
  (18)  THE  AMOUNT  OF  ANY  DEDUCTION  ALLOWED PURSUANT TO SECTION ONE
HUNDRED NINETY-NINE OF THE INTERNAL REVENUE CODE;
  (19) THE AMOUNT OF ANY FEDERAL DEDUCTION FOR TAXES IMPOSED UNDER ARTI-
CLE TWENTY-THREE OF THE TAX LAW.
  (C) INTENTIONALLY OMITTED.
  (C-1)(1) NOTWITHSTANDING ANY OTHER PROVISION OF  THIS  SUBCHAPTER,  IN
THE  CASE OF A TAXPAYER WHICH IS A FOREIGN AIR CARRIER HOLDING A FOREIGN
AIR CARRIER PERMIT ISSUED BY THE UNITED STATES DEPARTMENT OF TRANSPORTA-
TION PURSUANT TO SECTION FOUR HUNDRED TWO OF THE FEDERAL AVIATION ACT OF
NINETEEN HUNDRED FIFTY-EIGHT, AS AMENDED, AND WHICH IS  QUALIFIED  UNDER
SUBPARAGRAPH TWO OF THIS PARAGRAPH, ENTIRE NET INCOME SHALL NOT INCLUDE,
AND  SHALL  BE  COMPUTED  WITHOUT  THE DEDUCTION OF, AMOUNTS DIRECTLY OR
INDIRECTLY ATTRIBUTABLE TO, (I) ANY INCOME  DERIVED  FROM  THE  INTERNA-
TIONAL  OPERATION  OF  AIRCRAFT  AS  DESCRIBED  IN  AND  SUBJECT  TO THE
PROVISIONS OF SECTION EIGHT HUNDRED EIGHTY-THREE OF THE INTERNAL REVENUE
CODE, (II) INCOME WITHOUT THE UNITED STATES WHICH IS  DERIVED  FROM  THE
OPERATION  OF AIRCRAFT, AND (III) INCOME WITHOUT THE UNITED STATES WHICH
IS OF A TYPE DESCRIBED IN  SUBDIVISION  (A)  OF  SECTION  EIGHT  HUNDRED
EIGHTY-ONE  OF  THE INTERNAL REVENUE CODE EXCEPT THAT IT IS DERIVED FROM
SOURCES WITHOUT THE UNITED STATES.   ENTIRE  NET  INCOME  SHALL  INCLUDE
INCOME  DESCRIBED IN CLAUSES (I), (II) AND (III) OF THIS SUBPARAGRAPH IN
THE CASE OF TAXPAYERS NOT DESCRIBED IN THE PREVIOUS SENTENCE;
  (2) A TAXPAYER IS QUALIFIED UNDER THIS SUBPARAGRAPH  IF  AIR  CARRIERS
ORGANIZED  IN  THE UNITED STATES AND OPERATING IN THE FOREIGN COUNTRY OR
COUNTRIES IN WHICH THE TAXPAYER HAS ITS MAJOR BASE OF OPERATIONS AND  IN
WHICH  IT  IS  ORGANIZED,  RESIDENT OR HEADQUARTERED (IF NOT IN THE SAME
COUNTRY AS ITS MAJOR BASE OF OPERATIONS) ARE NOT SUBJECT TO  ANY  INCOME
TAX  OR  OTHER TAX BASED ON OR MEASURED BY INCOME OR RECEIPTS IMPOSED BY
SUCH FOREIGN COUNTRY OR COUNTRIES OR ANY POLITICAL SUBDIVISION  THEREOF,
OR  IF  SO  SUBJECT TO SUCH TAX, ARE PROVIDED AN EXEMPTION FROM SUCH TAX
EQUIVALENT TO THAT PROVIDED FOR HEREIN.
  (D) THE COMMISSIONER OF FINANCE MAY, WHENEVER NECESSARY IN ORDER PROP-
ERLY TO REFLECT THE ENTIRE NET INCOME OF  ANY  TAXPAYER,  DETERMINE  THE
YEAR  OR  PERIOD  IN  WHICH  ANY  ITEM  OF  INCOME OR DEDUCTION SHALL BE
INCLUDED, WITHOUT REGARD TO THE METHOD OF  ACCOUNTING  EMPLOYED  BY  THE
TAXPAYER.
  (E)  THE  ENTIRE NET INCOME OF ANY BRIDGE COMMISSION CREATED BY ACT OF
CONGRESS TO CONSTRUCT A BRIDGE ACROSS AN  INTERNATIONAL  BOUNDARY  MEANS
ITS GROSS INCOME LESS THE EXPENSE OF MAINTAINING AND OPERATING ITS PROP-
ERTIES,  THE  ANNUAL  INTEREST UPON ITS BONDS AND OTHER OBLIGATIONS, AND
THE ANNUAL CHARGE FOR THE RETIREMENT OF SUCH  BONDS  OR  OBLIGATIONS  AT
MATURITY.
  (F) INTENTIONALLY OMITTED.
  (G)  AT THE ELECTION OF THE TAXPAYER, A DEDUCTION SHALL BE ALLOWED FOR
EXPENDITURES  PAID  OR  INCURRED  DURING  THE  TAXABLE  YEAR   FOR   THE

S. 4610--A                         14                         A. 6721--A

CONSTRUCTION,  RECONSTRUCTION,  ERECTION  OR  IMPROVEMENT  OF INDUSTRIAL
WASTE TREATMENT FACILITIES AND AIR POLLUTION CONTROL FACILITIES.
  (1)(I)  THE  TERM  "INDUSTRIAL  WASTE TREATMENT FACILITIES" SHALL MEAN
FACILITIES FOR THE TREATMENT, NEUTRALIZATION OR STABILIZATION OF  INDUS-
TRIAL  WASTE  (AS  THE  TERM  "INDUSTRIAL  WASTE"  IS DEFINED IN SECTION
17-0105 OF THE ENVIRONMENTAL CONSERVATION LAW) FROM A POINT  IMMEDIATELY
PRECEDING  THE  POINT OF SUCH TREATMENT, NEUTRALIZATION OR STABILIZATION
TO THE POINT OF DISPOSAL, INCLUDING THE NECESSARY PUMPING AND  TRANSMIT-
TING FACILITIES, BUT EXCLUDING SUCH FACILITIES INSTALLED FOR THE PRIMARY
PURPOSE  OF  SALVAGING  MATERIALS  WHICH ARE USABLE IN THE MANUFACTURING
PROCESS OR ARE MARKETABLE.
  (II) THE TERM "AIR POLLUTION CONTROL FACILITIES" SHALL MEAN FACILITIES
WHICH REMOVE, REDUCE, OR RENDER LESS NOXIOUS  AIR  CONTAMINANTS  EMITTED
FROM  AN  AIR  CONTAMINATION  SOURCE (AS THE TERMS "AIR CONTAMINANT" AND
"AIR CONTAMINATION SOURCE" ARE DEFINED IN SECTION 19-0107 OF  THE  ENVI-
RONMENTAL CONSERVATION LAW) FROM A POINT IMMEDIATELY PRECEDING THE POINT
OF  SUCH  REMOVAL,  REDUCTION  OR RENDERING TO THE POINT OF DISCHARGE OF
AIR, MEETING EMISSION STANDARDS AS  ESTABLISHED  BY  THE  AIR  POLLUTION
CONTROL  BOARD,  BUT EXCLUDING SUCH FACILITIES INSTALLED FOR THE PRIMARY
PURPOSE OF SALVAGING MATERIALS WHICH ARE  USABLE  IN  THE  MANUFACTURING
PROCESS  OR ARE MARKETABLE AND EXCLUDING THOSE FACILITIES WHICH RELY FOR
THEIR EFFICACY ON DILUTION, DISPERSION OR ASSIMILATION  OF  AIR  CONTAM-
INANTS IN THE AMBIENT AIR AFTER EMISSION.
  (2)  HOWEVER, SUCH DEDUCTION SHALL BE ALLOWED ONLY (I) WITH RESPECT TO
TANGIBLE PROPERTY WHICH IS DEPRECIABLE, PURSUANT TO SECTION ONE  HUNDRED
SIXTY-SEVEN OF THE INTERNAL REVENUE CODE, HAVING A SITUS IN THE CITY AND
USED  IN  THE  TAXPAYER'S  TRADE  OR  BUSINESS, THE CONSTRUCTION, RECON-
STRUCTION, ERECTION OR IMPROVEMENT OF WHICH, IN THE CASE  OF  INDUSTRIAL
WASTE  TREATMENT  FACILITIES,  IS  INITIATED  ON OR AFTER JANUARY FIRST,
NINETEEN HUNDRED SIXTY-SIX, AND ONLY FOR EXPENDITURES PAID  OR  INCURRED
PRIOR  TO  JANUARY FIRST, NINETEEN HUNDRED SEVENTY-TWO, OR WHICH, IN THE
CASE OF AIR POLLUTION CONTROL FACILITIES, IS INITIATED ON OR AFTER JANU-
ARY FIRST, NINETEEN HUNDRED SIXTY-SIX, AND
  (II) ON CONDITION THAT SUCH FACILITIES  HAVE  BEEN  CERTIFIED  BY  THE
STATE  COMMISSIONER  OF  ENVIRONMENTAL CONSERVATION OR THE STATE COMMIS-
SIONER'S DESIGNATED REPRESENTATIVE, IN THE SAME MANNER AS  PROVIDED  FOR
IN  SECTION 17-0707 OR 19-0309 OF THE ENVIRONMENTAL CONSERVATION LAW, AS
APPLICABLE, AS COMPLYING WITH APPLICABLE PROVISIONS OF THE ENVIRONMENTAL
CONSERVATION LAW, THE STATE SANITARY CODE AND  REGULATIONS,  PERMITS  OR
ORDERS ISSUED PURSUANT THERETO, AND
  (III) ON CONDITION THAT ENTIRE NET INCOME FOR THE TAXABLE YEAR AND ALL
SUCCEEDING  TAXABLE  YEARS  BE  COMPUTED WITHOUT ANY DEDUCTIONS FOR SUCH
EXPENDITURES OR FOR DEPRECIATION OF THE SAME  PROPERTY  OTHER  THAN  THE
DEDUCTIONS ALLOWED BY THIS PARAGRAPH EXCEPT TO THE EXTENT THAT THE BASIS
OF  THE PROPERTY MAY BE ATTRIBUTABLE TO FACTORS OTHER THAN SUCH EXPENDI-
TURES, OR IN CASE A DEDUCTION IS ALLOWABLE PURSUANT  TO  THIS  PARAGRAPH
FOR  ONLY  A  PART OF SUCH EXPENDITURES, ON CONDITION THAT ANY DEDUCTION
ALLOWED FOR FEDERAL INCOME TAX PURPOSES FOR  SUCH  EXPENDITURES  OR  FOR
DEPRECIATION  OF THE SAME PROPERTY BE PROPORTIONATELY REDUCED IN COMPUT-
ING ENTIRE NET INCOME FOR THE TAXABLE YEAR AND  ALL  SUCCEEDING  TAXABLE
YEARS, AND
  (IV)  WHERE  THE ELECTION PROVIDED FOR IN PARAGRAPH (D) OF SUBDIVISION
THREE OF SECTION 11-604 OF THIS CHAPTER OR THE ELECTION PROVIDED FOR  IN
SUBDIVISION (K) OF SECTION 11-641 OF THIS CHAPTER HAS NOT BEEN EXERCISED
IN RESPECT TO THE SAME PROPERTY.

S. 4610--A                         15                         A. 6721--A

  (3)(I)  IF  EXPENDITURES  IN  RESPECT TO AN INDUSTRIAL WASTE TREATMENT
FACILITY OR AN AIR POLLUTION CONTROL  FACILITY  HAVE  BEEN  DEDUCTED  AS
PROVIDED HEREIN AND IF WITHIN TEN YEARS FROM THE END OF THE TAXABLE YEAR
IN WHICH SUCH DEDUCTION WAS ALLOWED SUCH PROPERTY OR ANY PART THEREOF IS
USED  FOR THE PRIMARY PURPOSE OF SALVAGING MATERIALS WHICH ARE USABLE IN
THE MANUFACTURING PROCESS OR ARE MARKETABLE, THE TAXPAYER  SHALL  REPORT
SUCH CHANGE OF USE IN ITS REPORT FOR THE FIRST TAXABLE YEAR DURING WHICH
IT OCCURS, AND THE COMMISSIONER OF FINANCE MAY RECOMPUTE THE TAX FOR THE
YEAR  OR YEARS FOR WHICH SUCH DEDUCTION WAS ALLOWED AND ANY CARRYBACK OR
CARRYOVER YEAR, AND MAY ASSESS ANY ADDITIONAL TAX  RESULTING  FROM  SUCH
RECOMPUTATION  WITHIN  THE  TIME  FIXED  BY PARAGRAPH (H) OF SUBDIVISION
THREE OF SECTION 11-674 OF THIS CHAPTER.
  (II) IF A DEDUCTION IS ALLOWED AS  HEREIN  PROVIDED  FOR  EXPENDITURES
PAID  OR  INCURRED  DURING  ANY TAXABLE YEAR ON THE BASIS OF A TEMPORARY
CERTIFICATE OF COMPLIANCE ISSUED PURSUANT TO THE ENVIRONMENTAL CONSERVA-
TION LAW AND IF THE TAXPAYER FAILS TO OBTAIN A PERMANENT CERTIFICATE  OF
COMPLIANCE  UPON COMPLETION OF THE FACILITIES WITH RESPECT TO WHICH SUCH
TEMPORARY CERTIFICATE WAS ISSUED, THE TAXPAYER SHALL REPORT SUCH FAILURE
IN ITS REPORT FOR THE TAXABLE YEAR  DURING  WHICH  SUCH  FACILITIES  ARE
COMPLETED, AND THE COMMISSIONER OF FINANCE MAY RECOMPUTE THE TAX FOR THE
YEAR  OR YEARS FOR WHICH SUCH DEDUCTION WAS ALLOWED AND ANY CARRYBACK OR
CARRYOVER YEAR, AND MAY ASSESS ANY ADDITIONAL TAX  RESULTING  FROM  SUCH
RECOMPUTATION  WITHIN  THE  TIME  FIXED  BY PARAGRAPH (H) OF SUBDIVISION
THREE OF SECTION 11-674 OF THIS CHAPTER.
  (4) IN ANY TAXABLE YEAR WHEN PROPERTY IS SOLD  OR  OTHERWISE  DISPOSED
OF,  WITH RESPECT TO WHICH A DEDUCTION HAS BEEN ALLOWED PURSUANT TO THIS
PARAGRAPH, SUCH DEDUCTION SHALL BE  DISREGARDED  IN  COMPUTING  GAIN  OR
LOSS,  AND  THE  GAIN  OR  LOSS ON THE SALE OR OTHER DISPOSITION OF SUCH
PROPERTY SHALL BE THE GAIN OR LOSS  ENTERING  INTO  THE  COMPUTATION  OF
ENTIRE  TAXABLE  INCOME  WHICH THE TAXPAYER IS REQUIRED TO REPORT TO THE
UNITED STATES TREASURY FOR SUCH TAXABLE YEAR;
  (H) WITH RESPECT TO GAIN DERIVED FROM THE SALE OR OTHER DISPOSITION OF
ANY  PROPERTY  ACQUIRED  PRIOR  TO  JANUARY  FIRST,   NINETEEN   HUNDRED
SIXTY-SIX;  WHICH  HAD  A FEDERAL ADJUSTED BASIS ON SUCH DATE (OR ON THE
DATE OF ITS SALE OR OTHER DISPOSITION PRIOR TO JANUARY  FIRST,  NINETEEN
HUNDRED  SIXTY-SIX)  LOWER  THAN ITS FAIR MARKET VALUE ON JANUARY FIRST,
NINETEEN HUNDRED SIXTY-SIX OR THE DATE OF ITS SALE OR OTHER  DISPOSITION
PRIOR  THERETO, EXCEPT PROPERTY DESCRIBED IN SUBSECTIONS ONE AND FOUR OF
SECTION TWELVE HUNDRED TWENTY-ONE OF THE INTERNAL  REVENUE  CODE,  THERE
SHALL BE DEDUCTED FROM ENTIRE NET INCOME, THE DIFFERENCE BETWEEN (1) THE
AMOUNT  OF  THE TAXPAYER'S FEDERAL TAXABLE INCOME, AND (2) THE AMOUNT OF
THE TAXPAYER'S FEDERAL  TAXABLE  INCOME  (IF  SMALLER  THAN  THE  AMOUNT
DESCRIBED  IN  SUBPARAGRAPH  ONE  OF  THIS PARAGRAPH) COMPUTED AS IF THE
FEDERAL ADJUSTED BASIS OF EACH SUCH  PROPERTY  (ON  THE  SALE  OR  OTHER
DISPOSITION  OF WHICH GAIN WAS DERIVED) ON THE DATE OF THE SALE OR OTHER
DISPOSITION HAD BEEN EQUAL TO EITHER (I) ITS FAIR MARKET VALUE ON  JANU-
ARY  FIRST,  NINETEEN HUNDRED SIXTY-SIX OR THE DATE OF ITS SALE OR OTHER
DISPOSITION PRIOR TO JANUARY FIRST, NINETEEN HUNDRED SIXTY-SIX, PLUS  OR
MINUS  ALL  ADJUSTMENTS  TO BASIS MADE WITH RESPECT TO SUCH PROPERTY FOR
FEDERAL INCOME TAX PURPOSES FOR PERIODS  ON  AND  AFTER  JANUARY  FIRST,
NINETEEN  HUNDRED SIXTY-SIX OR (II) THE AMOUNT REALIZED FROM ITS SALE OR
DISPOSITION, WHICHEVER IS  LOWER;  PROVIDED,  HOWEVER,  THAT  THE  TOTAL
MODIFICATION  PROVIDED  BY THIS PARAGRAPH SHALL NOT EXCEED THE AMOUNT OF
THE TAXPAYER'S NET GAIN FROM THE SALE OR OTHER DISPOSITION OF  ALL  SUCH
PROPERTY.

S. 4610--A                         16                         A. 6721--A

  (I)  IF  THE PERIOD COVERED BY A REPORT UNDER THIS SUBCHAPTER IS OTHER
THAN THE PERIOD COVERED BY THE REPORT  OF  THE  UNITED  STATES  TREASURY
DEPARTMENT,  ENTIRE  NET  INCOME  SHALL BE DETERMINED BY MULTIPLYING THE
FEDERAL TAXABLE INCOME (AS ADJUSTED PURSUANT TO THE PROVISIONS  OF  THIS
SUBCHAPTER)  BY  THE  NUMBER  OF  CALENDAR MONTHS OR MAJOR PARTS THEREOF
COVERED BY THE REPORT UNDER THIS SUBCHAPTER AND DIVIDING BY  THE  NUMBER
OF  CALENDAR MONTHS OR MAJOR PARTS THEREOF COVERED BY THE REPORT TO SUCH
DEPARTMENT. IF IT SHALL APPEAR THAT SUCH METHOD  OF  DETERMINING  ENTIRE
NET  INCOME  DOES  NOT PROPERLY REFLECT THE TAXPAYER'S INCOME DURING THE
PERIOD COVERED BY THE REPORT UNDER THIS SUBCHAPTER, THE COMMISSIONER  OF
FINANCE  SHALL  BE AUTHORIZED IN HIS OR HER DISCRETION TO DETERMINE SUCH
ENTIRE NET INCOME SOLELY ON THE BASIS OF THE  TAXPAYER'S  INCOME  DURING
THE PERIOD COVERED BY ITS REPORT UNDER THIS SUBCHAPTER.
  (J)  IN THE CASE OF PROPERTY PLACED IN SERVICE IN TAXABLE YEARS BEGIN-
NING BEFORE NINETEEN HUNDRED NINETY-FOUR, FOR  TAXABLE  YEARS  BEGINNING
AFTER  DECEMBER  THIRTY-FIRST,  NINETEEN HUNDRED EIGHTY-ONE, EXCEPT WITH
RESPECT TO PROPERTY SUBJECT TO THE PROVISIONS  OF  SECTION  TWO  HUNDRED
EIGHTY  F  OF  THE  INTERNAL  REVENUE  CODE  AND PROPERTY SUBJECT TO THE
PROVISIONS OF SECTION ONE HUNDRED SIXTY-EIGHT OF  THE  INTERNAL  REVENUE
CODE WHICH IS PLACED IN SERVICE IN THIS STATE IN TAXABLE YEARS BEGINNING
AFTER  DECEMBER THIRTY-FIRST, NINETEEN HUNDRED EIGHTY-FOUR, AND PROVIDED
A DEDUCTION HAS NOT BEEN EXCLUDED FROM ENTIRE  NET  INCOME  PURSUANT  TO
SUBPARAGRAPH NINE OF PARAGRAPH (B) OF THIS SUBDIVISION, A TAXPAYER SHALL
BE  ALLOWED  WITH RESPECT TO PROPERTY WHICH IS SUBJECT TO THE PROVISIONS
OF SECTION ONE HUNDRED SIXTY-EIGHT OF  THE  INTERNAL  REVENUE  CODE  THE
DEPRECIATION  DEDUCTION  ALLOWABLE UNDER SECTION ONE HUNDRED SIXTY-SEVEN
OF THE INTERNAL REVENUE CODE AS SUCH SECTION WOULD HAVE APPLIED TO PROP-
ERTY PLACED  IN  SERVICE  ON  DECEMBER  THIRTY-FIRST,  NINETEEN  HUNDRED
EIGHTY. THIS PARAGRAPH SHALL NOT APPLY TO PROPERTY OF A TAXPAYER PRINCI-
PALLY ENGAGED IN THE CONDUCT OF AN AVIATION, STEAMBOAT, FERRY OR NAVIGA-
TION  BUSINESS,  OR  TWO  OR MORE OF SUCH BUSINESSES, WHICH IS PLACED IN
SERVICE BEFORE TAXABLE YEARS BEGINNING IN NINETEEN HUNDRED EIGHTY-NINE.
  (K) IN THE CASE OF QUALIFIED PROPERTY DESCRIBED IN  PARAGRAPH  TWO  OF
SUBSECTION (K) OF SECTION ONE HUNDRED SIXTY-EIGHT OF THE INTERNAL REVEN-
UE  CODE,  OTHER  THAN  QUALIFIED  RESURGENCE ZONE PROPERTY DESCRIBED IN
PARAGRAPH (M) OF THIS SUBDIVISION, AND OTHER  THAN  QUALIFIED  NEW  YORK
LIBERTY  ZONE  PROPERTY  DESCRIBED IN PARAGRAPH TWO OF SUBSECTION (B) OF
SECTION FOURTEEN HUNDRED L OF THE INTERNAL REVENUE CODE (WITHOUT  REGARD
TO  CLAUSE  (I) OF SUBPARAGRAPH (C) OF SUCH PARAGRAPH), THE DEPRECIATION
DEDUCTION ALLOWABLE  UNDER  SECTION  ONE  HUNDRED  SIXTY-SEVEN  AS  SUCH
SECTION  WOULD HAVE APPLIED TO SUCH PROPERTY HAD IT BEEN ACQUIRED BY THE
TAXPAYER ON SEPTEMBER TENTH, TWO THOUSAND ONE, PROVIDED,  HOWEVER,  THAT
FOR  TAXABLE  YEARS  BEGINNING  ON  OR AFTER JANUARY FIRST, TWO THOUSAND
FOUR, IN THE CASE OF A PASSENGER MOTOR VEHICLE OR A SPORT UTILITY  VEHI-
CLE  SUBJECT TO THE PROVISIONS OF PARAGRAPH (O) OF THIS SUBDIVISION, THE
LIMITATION UNDER CLAUSE (I) OF SUBPARAGRAPH  (A)  OF  PARAGRAPH  ONE  OF
SUBDIVISION  (A) OF SECTION TWO HUNDRED EIGHTY F OF THE INTERNAL REVENUE
CODE APPLICABLE TO THE AMOUNT ALLOWED AS A DEDUCTION  UNDER  THIS  PARA-
GRAPH  SHALL  BE  DETERMINED  AS  OF THE DATE SUCH VEHICLE WAS PLACED IN
SERVICE AND NOT AS OF SEPTEMBER TENTH, TWO THOUSAND ONE.
  (L) UPON THE DISPOSITION OF PROPERTY TO WHICH PARAGRAPH  (K)  OF  THIS
SUBDIVISION APPLIES, THE AMOUNT OF ANY GAIN OR LOSS INCLUDIBLE IN ENTIRE
NET  INCOME  SHALL  BE ADJUSTED TO REFLECT THE INCLUSIONS AND EXCLUSIONS
FROM ENTIRE NET INCOME PURSUANT TO SUBPARAGRAPH TWELVE OF PARAGRAPH  (A)
AND  SUBPARAGRAPH SIXTEEN OF PARAGRAPH (B) OF THIS SUBDIVISION ATTRIBUT-
ABLE TO SUCH PROPERTY.

S. 4610--A                         17                         A. 6721--A

  (M) FOR PURPOSES OF THIS PARAGRAPH AND PARAGRAPH (L) OF THIS  SUBDIVI-
SION,  QUALIFIED  RESURGENCE ZONE PROPERTY SHALL MEAN QUALIFIED PROPERTY
DESCRIBED IN PARAGRAPH TWO OF SUBSECTION  (K)  OF  SECTION  ONE  HUNDRED
SIXTY-EIGHT OF THE INTERNAL REVENUE CODE SUBSTANTIALLY ALL OF THE USE OF
WHICH  IS IN THE RESURGENCE ZONE, AS DEFINED BELOW, AND IS IN THE ACTIVE
CONDUCT OF A TRADE OR BUSINESS BY THE TAXPAYER IN  SUCH  ZONE,  AND  THE
ORIGINAL USE OF WHICH IN THE RESURGENCE ZONE COMMENCES WITH THE TAXPAYER
AFTER SEPTEMBER TENTH, TWO THOUSAND ONE.  THE RESURGENCE ZONE SHALL MEAN
THE  AREA OF NEW YORK COUNTY BOUNDED ON THE SOUTH BY A LINE RUNNING FROM
THE INTERSECTION OF THE  HUDSON  RIVER  WITH  THE  HOLLAND  TUNNEL,  AND
RUNNING  THENCE  EAST TO CANAL STREET, THEN RUNNING ALONG THE CENTERLINE
OF CANAL STREET TO THE INTERSECTION OF  THE  BOWERY  AND  CANAL  STREET,
RUNNING  THENCE IN A SOUTHEASTERLY DIRECTION DIAGONALLY ACROSS MANHATTAN
BRIDGE PLAZA, TO THE MANHATTAN BRIDGE, AND THENCE ALONG  THE  CENTERLINE
OF THE MANHATTAN BRIDGE TO THE POINT WHERE THE CENTERLINE OF THE MANHAT-
TAN BRIDGE WOULD INTERSECT WITH THE EASTERLY BANK OF THE EAST RIVER, AND
BOUNDED  ON  THE  NORTH  BY  A LINE RUNNING FROM THE INTERSECTION OF THE
HUDSON RIVER WITH THE HOLLAND TUNNEL AND RUNNING THENCE NORTH ALONG WEST
AVENUE TO THE INTERSECTION OF CLARKSON STREET THEN  RUNNING  EAST  ALONG
THE  CENTERLINE  OF  CLARKSON  STREET  TO THE INTERSECTION OF WASHINGTON
AVENUE, THEN RUNNING SOUTH ALONG THE CENTERLINE OF WASHINGTON AVENUE  TO
THE  INTERSECTION OF WEST HOUSTON STREET, THEN EAST ALONG THE CENTERLINE
OF WEST HOUSTON STREET, THEN AT THE INTERSECTION OF THE  AVENUE  OF  THE
AMERICAS  CONTINUING EAST ALONG THE CENTERLINE OF EAST HOUSTON STREET TO
THE EASTERLY BANK OF THE EAST RIVER.
  (N) RELATED MEMBERS EXPENSE ADD BACK. (1) FOR PURPOSES OF  THIS  PARA-
GRAPH: (I) "RELATED MEMBER" MEANS A RELATED PERSON AS DEFINED IN SUBPAR-
AGRAPH  (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".
  (II) "EFFECTIVE RATE OF TAX" MEANS, AS TO ANY CITY, THE MAXIMUM STATU-
TORY  RATE  OF  TAX  IMPOSED  BY  THE  CITY  ON OR MEASURED BY A RELATED
MEMBER'S NET INCOME MULTIPLIED BY THE  ALLOCATION  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.
  (III) ROYALTY PAYMENTS ARE PAYMENTS DIRECTLY CONNECTED TO THE ACQUISI-
TION,  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  COMMIS-
SIONER  OF FINANCE, AND 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

S. 4610--A                         18                         A. 6721--A

CONNECTION  WITH THE ACQUISITION, USE, MAINTENANCE OR MANAGEMENT, OWNER-
SHIP, SALE, EXCHANGE OR DISPOSITION OF SUCH INTANGIBLE ASSETS.
  (IV)  A VALID BUSINESS PURPOSE IS ONE OR MORE BUSINESS PURPOSES, OTHER
THAN THE AVOIDANCE OR REDUCTION OF TAXATION, WHICH ALONE OR IN  COMBINA-
TION  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. (I) EXCEPT WHERE A TAXPAYER IS INCLUDED
IN A COMBINED REPORT PURSUANT TO SECTION  11-654.3  OF  THIS  SUBCHAPTER
WITH  THE APPLICABLE RELATED MEMBER, FOR THE PURPOSE OF COMPUTING ENTIRE
NET INCOME OR OTHER APPLICABLE TAXABLE BASIS, A TAXPAYER MUST  ADD  BACK
ROYALTY  PAYMENTS  DIRECTLY  OR INDIRECTLY PAID, ACCRUED, OR INCURRED IN
CONNECTION WITH ONE OR MORE DIRECT OR INDIRECT TRANSACTIONS WITH ONE  OR
MORE RELATED MEMBERS DURING THE TAXABLE YEAR TO THE EXTENT DEDUCTIBLE IN
CALCULATING FEDERAL TAXABLE INCOME.
  (II)  EXCEPTIONS.  (A) 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  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.
  (B) 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 CHAPTER FOR THE
TAXABLE YEAR.
  (C) 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.

S. 4610--A                         19                         A. 6721--A

  (D) 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.
  (O)  IN  THE  CASE  OF  A  TAXPAYER  THAT IS NOT AN ELIGIBLE FARMER AS
DEFINED IN SUBSECTION (N) OF SECTION SIX HUNDRED SIX OF THE TAX LAW, THE
DEDUCTIONS  ALLOWABLE  UNDER  SECTIONS  ONE  HUNDRED  SEVENTY-NINE,  ONE
HUNDRED  SIXTY-SEVEN AND ONE HUNDRED SIXTY-EIGHT OF THE INTERNAL REVENUE
CODE WITH RESPECT TO A SPORT UTILITY VEHICLE THAT  IS  NOT  A  PASSENGER
AUTOMOBILE AS DEFINED IN PARAGRAPH FIVE OF SUBSECTION (D) OF SECTION TWO
HUNDRED  EIGHTY  F  OF  THE INTERNAL REVENUE CODE, DETERMINED AS IF SUCH
SPORT UTILITY VEHICLE WERE A PASSENGER AUTOMOBILE  AS  DEFINED  IN  SUCH
PARAGRAPH  FIVE.  FOR  PURPOSES OF SUBPARAGRAPH SIXTEEN OF PARAGRAPH (B)
AND PARAGRAPH (K) OF THIS SUBDIVISION, THE  TERMS  QUALIFIED  RESURGENCE
ZONE  PROPERTY AND QUALIFIED NEW YORK LIBERTY ZONE PROPERTY DESCRIBED IN
PARAGRAPH TWO OF SUBSECTION B OF  SECTION  FOURTEEN  HUNDRED  L  OF  THE
INTERNAL  REVENUE  CODE SHALL NOT INCLUDE ANY SPORT UTILITY VEHICLE THAT
IS NOT A PASSENGER AUTOMOBILE AS DEFINED IN PARAGRAPH FIVE OF SUBSECTION
(D) OF SECTION TWO HUNDRED EIGHTY F OF THE INTERNAL REVENUE CODE.
  (P) UPON THE DISPOSITION OF PROPERTY TO WHICH PARAGRAPH  (O)  OF  THIS
SUBDIVISION APPLIES, THE AMOUNT OF ANY GAIN OR LOSS INCLUDIBLE IN ENTIRE
NET  INCOME  SHALL  BE ADJUSTED TO REFLECT THE INCLUSIONS AND EXCLUSIONS
FROM ENTIRE NET INCOME PURSUANT TO SUBPARAGRAPH  THIRTEEN  OF  PARAGRAPH
(A)  AND  SUBPARAGRAPH  SEVENTEEN  OF  PARAGRAPH (B) OF THIS SUBDIVISION
ATTRIBUTABLE TO SUCH PROPERTY.
  (Q) SUBTRACTION MODIFICATION FOR COMMUNITY BANKS  AND  SMALL  THRIFTS.
(1) A TAXPAYER THAT IS A QUALIFIED COMMUNITY BANK AS DEFINED IN SUBPARA-
GRAPH  TWO OF THIS PARAGRAPH OR A SMALL THRIFT INSTITUTION AS DEFINED IN
SUBPARAGRAPH TWO-A OF THIS PARAGRAPH SHALL BE  ALLOWED  A  DEDUCTION  IN
COMPUTING  ENTIRE NET INCOME EQUAL TO THE AMOUNT COMPUTED UNDER SUBPARA-
GRAPH THREE OF THIS PARAGRAPH.
  (2) TO BE A QUALIFIED COMMUNITY BANK,  A  TAXPAYER  MUST  SATISFY  THE
FOLLOWING CONDITIONS:
  (I)  IT  IS  A BANK OR TRUST COMPANY ORGANIZED UNDER OR SUBJECT TO THE
PROVISIONS OF ARTICLE THREE OF THE BANKING LAW OR A COMPARABLE PROVISION
OF THE LAWS OF ANOTHER STATE, OR A NATIONAL BANKING ASSOCIATION.
  (II) THE AVERAGE VALUE DURING THE TAXABLE YEAR OF THE  ASSETS  OF  THE
TAXPAYER,  OR,  IF  THE  TAXPAYER  IS INCLUDED IN A COMBINED REPORT, THE
ASSETS OF THE COMBINED REPORTING GROUP OF  THE  TAXPAYER  UNDER  SECTION
11-654.3 OF THIS SUBCHAPTER, MUST NOT EXCEED EIGHT BILLION DOLLARS.
  (2-A)  TO  BE  A SMALL THRIFT INSTITUTION, A TAXPAYER MUST SATISFY THE
FOLLOWING CONDITIONS:
  (I) IT IS A SAVINGS BANK, A SAVINGS AND  LOAN  ASSOCIATION,  OR  OTHER
SAVINGS  INSTITUTION  CHARTERED  AND SUPERVISED AS SUCH UNDER FEDERAL OR
STATE LAW.
  (II) THE AVERAGE VALUE DURING THE TAXABLE YEAR OF THE  ASSETS  OF  THE
TAXPAYER,  OR,  IF  THE  TAXPAYER  IS INCLUDED IN A COMBINED REPORT, THE
ASSETS OF THE COMBINED REPORTING GROUP OF  THE  TAXPAYER  UNDER  SECTION
11-654.3 OF THIS SUBCHAPTER, MUST NOT EXCEED EIGHT BILLION DOLLARS.
  (3)(I) THE SUBTRACTION MODIFICATION SHALL BE COMPUTED AS FOLLOWS:
  (A)  MULTIPLY THE TAXPAYER'S NET INTEREST INCOME FROM LOANS DURING THE
TAXABLE YEAR BY A FRACTION, THE NUMERATOR OF WHICH IS THE GROSS INTEREST
INCOME DURING THE TAXABLE YEAR FROM QUALIFYING LOANS AND THE DENOMINATOR

S. 4610--A                         20                         A. 6721--A

OF WHICH IS THE GROSS INTEREST INCOME DURING THE TAXABLE YEAR  FROM  ALL
LOANS.
  (B)  MULTIPLY THE AMOUNT DETERMINED IN SUBCLAUSE (A) OF THIS CLAUSE BY
FIFTY PERCENT. THIS PRODUCT IS THE AMOUNT OF THE DEDUCTION ALLOWED UNDER
THIS PARAGRAPH.
  (II)(A) NET INTEREST INCOME  FROM  LOANS  SHALL  MEAN  GROSS  INTEREST
INCOME FROM LOANS LESS GROSS INTEREST EXPENSE FROM LOANS. GROSS INTEREST
EXPENSE  FROM  LOANS IS DETERMINED BY MULTIPLYING GROSS INTEREST EXPENSE
BY A FRACTION, THE NUMERATOR OF WHICH IS  THE  AVERAGE  TOTAL  VALUE  OF
LOANS OWNED BY THE THRIFT INSTITUTION OR COMMUNITY BANK DURING THE TAXA-
BLE YEAR AND THE DENOMINATOR OF WHICH IS THE AVERAGE TOTAL ASSETS OF THE
THRIFT INSTITUTION OR COMMUNITY BANK DURING THE TAXABLE YEAR.
  (B)  MEASUREMENT  OF ASSETS.   FOR PURPOSES OF THIS CLAUSE:  (I) TOTAL
ASSETS ARE THOSE ASSETS THAT ARE PROPERLY REFLECTED ON A BALANCE  SHEET,
COMPUTED  IN  THE SAME MANNER AS IS REQUIRED BY THE BANKING REGULATOR OF
THE TAXPAYERS INCLUDED IN THE COMBINED RETURN.
  (II) ASSETS WILL ONLY BE INCLUDED IF THE INCOME OR EXPENSES  OF  WHICH
ARE  PROPERLY  REFLECTED  (OR  WOULD HAVE BEEN PROPERLY REFLECTED IF NOT
FULLY DEPRECIATED OR EXPENSED, OR DEPRECIATED OR EXPENSED TO  A  NOMINAL
AMOUNT)  IN  THE COMPUTATION OF THE TAXPAYER'S ENTIRE NET INCOME FOR THE
TAXABLE YEAR. ASSETS WILL NOT INCLUDE DEFERRED TAX ASSETS AND INTANGIBLE
ASSETS IDENTIFIED AS "GOODWILL".
  (III) TANGIBLE REAL AND PERSONAL PROPERTY, SUCH  AS  BUILDINGS,  LAND,
MACHINERY, AND EQUIPMENT, SHALL BE VALUED AT COST. LEASED ASSETS WILL BE
VALUED AT THE ANNUAL LEASE PAYMENT MULTIPLIED BY EIGHT. INTANGIBLE PROP-
ERTY,  SUCH  AS  LOANS  AND  INVESTMENTS,  SHALL BE VALUED AT BOOK VALUE
EXCLUSIVE OF RESERVES.
  (IV) AVERAGE ASSETS ARE COMPUTED USING  THE  ASSETS  MEASURED  ON  THE
FIRST  DAY  OF  THE TAXABLE YEAR, AND ON THE LAST DAY OF EACH SUBSEQUENT
QUARTER OF THE TAXABLE YEAR OR MONTH OR DAY DURING THE TAXABLE YEAR.
  (III) A QUALIFYING LOAN IS A LOAN THAT MEETS THE CONDITIONS  SPECIFIED
IN SUBCLAUSE (A) OF THIS CLAUSE AND SUBCLAUSE (B) OF THIS CLAUSE.
  (A)  THE  LOAN  IS ORIGINATED BY THE QUALIFIED COMMUNITY BANK OR SMALL
THRIFT INSTITUTION OR PURCHASED BY THE QUALIFIED COMMUNITY BANK OR SMALL
THRIFT INSTITUTION IMMEDIATELY AFTER ITS ORIGINATION IN CONNECTION  WITH
A COMMITMENT TO PURCHASE MADE BY THE BANK OR THRIFT INSTITUTION PRIOR TO
THE LOAN'S ORIGINATION.
  (B)  THE LOAN IS A SMALL BUSINESS LOAN OR A RESIDENTIAL MORTGAGE LOAN,
THE PRINCIPAL AMOUNT OF WHICH LOAN IS FIVE MILLION DOLLARS OR LESS,  AND
EITHER  THE BORROWER IS LOCATED IN THIS CITY AS DETERMINED UNDER SECTION
11-654.2 OF THIS SUBCHAPTER AND THE LOAN IS NOT SECURED BY REAL  PROPER-
TY, OR THE LOAN IS SECURED BY REAL PROPERTY LOCATED IN THE CITY.
  (C)  A  LOAN THAT MEETS THE DEFINITION OF A QUALIFYING LOAN IN A PRIOR
TAXABLE YEAR (INCLUDING YEARS PRIOR TO THE EFFECTIVE DATE OF THIS  PARA-
GRAPH) REMAINS A QUALIFYING LOAN IN TAXABLE YEARS DURING AND AFTER WHICH
SUCH  LOAN IS ACQUIRED BY ANOTHER CORPORATION IN THE TAXPAYER'S COMBINED
REPORTING GROUP UNDER SECTION 11-654.3 OF THIS SUBCHAPTER.
  (R) A SMALL THRIFT INSTITUTION  OR  A  QUALIFIED  COMMUNITY  BANK,  AS
DEFINED  IN PARAGRAPH (Q) OF THIS SUBDIVISION, THAT MAINTAINED A CAPTIVE
REIT ON  APRIL  FIRST,  TWO  THOUSAND  FOURTEEN  SHALL  UTILIZE  A  REIT
SUBTRACTION  EQUAL  TO  ONE  HUNDRED SIXTY PERCENT OF THE DIVIDENDS PAID
DEDUCTIONS ALLOWED TO THAT CAPTIVE REIT FOR THE TAXABLE YEAR FOR FEDERAL
INCOME TAX PURPOSES AND SHALL NOT BE ALLOWED TO UTILIZE THE  SUBTRACTION
MODIFICATION  FOR  COMMUNITY BANKS AND SMALL THRIFTS UNDER PARAGRAPH (Q)
OF THIS SUBDIVISION OR THE SUBTRACTION MODIFICATION FOR QUALIFIED  RESI-
DENTIAL  LOAN  PORTFOLIOS UNDER PARAGRAPH (S) OF THIS SUBDIVISION IN ANY

S. 4610--A                         21                         A. 6721--A

TAX YEAR IN WHICH SUCH THRIFT INSTITUTION OR  COMMUNITY  BANK  MAINTAINS
THAT CAPTIVE REIT.
  (S)  SUBTRACTION  MODIFICATION  FOR QUALIFIED RESIDENTIAL LOAN PORTFO-
LIOS. (1)(I) A TAXPAYER THAT IS EITHER A THRIFT INSTITUTION  AS  DEFINED
IN SUBPARAGRAPH THREE OF THIS PARAGRAPH OR A QUALIFIED COMMUNITY BANK AS
DEFINED  IN  SUBPARAGRAPH  TWO  OF PARAGRAPH (Q) OF THIS SUBDIVISION AND
MAINTAINS A QUALIFIED RESIDENTIAL LOAN PORTFOLIO AS DEFINED IN  SUBPARA-
GRAPH TWO OF THIS PARAGRAPH SHALL BE ALLOWED AS A DEDUCTION IN COMPUTING
ENTIRE NET INCOME THE AMOUNT, IF ANY, BY WHICH (A) THIRTY-TWO PERCENT OF
ITS  ENTIRE  NET  INCOME  DETERMINED  WITHOUT  REGARD  TO THIS PARAGRAPH
EXCEEDS (B) THE AMOUNTS DEDUCTED BY THE TAXPAYER  PURSUANT  TO  SECTIONS
ONE  HUNDRED  SIXTY-SIX  AND  FIVE  HUNDRED  EIGHTY-FIVE OF THE INTERNAL
REVENUE CODE LESS ANY AMOUNTS INCLUDED IN FEDERAL TAXABLE  INCOME  AS  A
RESULT OF A RECOVERY OF A LOAN.
  (II)(A) IF THE TAXPAYER IS IN A COMBINED REPORT UNDER SECTION 11-654.3
OF THIS SUBCHAPTER, THIS DEDUCTION WILL BE COMPUTED ON A COMBINED BASIS.
IN  THAT INSTANCE, THE ENTIRE NET INCOME OF THE COMBINED REPORTING GROUP
FOR PURPOSES OF THIS PARAGRAPH SHALL BE MULTIPLIED BY  A  FRACTION,  THE
NUMERATOR  OF WHICH IS THE AVERAGE TOTAL ASSETS OF ALL THE THRIFT INSTI-
TUTIONS AND QUALIFIED COMMUNITY BANKS INCLUDED IN  THE  COMBINED  REPORT
AND  THE  DENOMINATOR  OF  WHICH  IS THE AVERAGE TOTAL ASSETS OF ALL THE
CORPORATIONS INCLUDED IN THE COMBINED REPORT.
  (B) MEASUREMENT OF ASSETS. FOR PURPOSES OF THIS PARAGRAPH:  (I)  TOTAL
ASSETS  ARE THOSE ASSETS THAT ARE PROPERLY REFLECTED ON A BALANCE SHEET,
COMPUTED IN THE SAME MANNER AS IS REQUIRED BY THE BANKING  REGULATOR  OF
THE TAXPAYERS INCLUDED IN THE COMBINED RETURN.
  (II)  ASSETS  WILL ONLY BE INCLUDED IF THE INCOME OR EXPENSES OF WHICH
ARE PROPERLY REFLECTED (OR WOULD HAVE BEEN  PROPERLY  REFLECTED  IF  NOT
FULLY  DEPRECIATED  OR EXPENSED, OR DEPRECIATED OR EXPENSED TO A NOMINAL
AMOUNT) IN THE COMPUTATION OF THE COMBINED GROUP'S ENTIRE NET INCOME FOR
THE TAXABLE YEAR. ASSETS WILL NOT INCLUDE DEFERRED TAX ASSETS AND INTAN-
GIBLE ASSETS IDENTIFIED AS "GOODWILL".
  (III) TANGIBLE REAL AND PERSONAL PROPERTY, SUCH  AS  BUILDINGS,  LAND,
MACHINERY,  AND EQUIPMENT SHALL BE VALUED AT COST. LEASED ASSETS WILL BE
VALUED AT THE ANNUAL LEASE PAYMENT MULTIPLIED BY EIGHT. INTANGIBLE PROP-
ERTY, SUCH AS LOANS AND INVESTMENTS,  SHALL  BE  VALUED  AT  BOOK  VALUE
EXCLUSIVE OF RESERVES.
  (IV)  INTERCORPORATE  STOCKHOLDINGS  AND  BILLS,  NOTES  AND  ACCOUNTS
RECEIVABLE, AND OTHER INTERCORPORATE  INDEBTEDNESS  BETWEEN  THE  CORPO-
RATIONS INCLUDED IN THE COMBINED REPORT SHALL BE ELIMINATED.
  (V) AVERAGE ASSETS ARE COMPUTED USING THE ASSETS MEASURED ON THE FIRST
DAY  OF THE TAXABLE YEAR, AND ON THE LAST DAY OF EACH SUBSEQUENT QUARTER
OF THE TAXABLE YEAR OR MONTH OR DAY DURING THE TAXABLE YEAR.
  (2) QUALIFIED RESIDENTIAL LOAN PORTFOLIO. (I) A TAXPAYER  MAINTAINS  A
QUALIFIED  RESIDENTIAL  LOAN  PORTFOLIO IF AT LEAST SIXTY PERCENT OF THE
AMOUNT OF THE TOTAL ASSETS AT THE CLOSE  OF  THE  TAXABLE  YEAR  OF  THE
THRIFT  INSTITUTION  OR  QUALIFIED COMMUNITY BANK CONSISTS OF THE ASSETS
DESCRIBED IN SUBCLAUSES (A) THROUGH (L) OF THIS CLAUSE, WITH THE  APPLI-
CATION OF THE RULE IN THE LAST UNDESIGNATED SUBCLAUSE OF THIS CLAUSE. IF
THE  TAXPAYER  IS  A  MEMBER  OF  A COMBINED GROUP, THE DETERMINATION OF
WHETHER THERE IS A QUALIFIED RESIDENTIAL LOAN PORTFOLIO WILL BE MADE  BY
AGGREGATING THE ASSETS OF THE THRIFT INSTITUTIONS AND QUALIFIED COMMUNI-
TY  BANKS  THAT  ARE  MEMBERS OF THE COMBINED GROUP.   ASSETS: (A) CASH,
WHICH INCLUDES CASH AND CASH EQUIVALENTS INCLUDING  CASH  ITEMS  IN  THE
PROCESS  OF  COLLECTION,  DEPOSITS  WITH  OTHER  FINANCIAL INSTITUTIONS,
INCLUDING CORPORATE CREDIT UNIONS, BALANCES WITH FEDERAL  RESERVE  BANKS

S. 4610--A                         22                         A. 6721--A

AND  FEDERAL  HOME  LOAN  BANKS,  FEDERAL  FUNDS SOLD, AND CASH AND CASH
EQUIVALENTS ON HAND. CASH SHALL NOT  INCLUDE  ANY  BALANCES  SERVING  AS
COLLATERAL  FOR  SECURITIES LENDING TRANSACTIONS; (B) OBLIGATIONS OF THE
UNITED  STATES OR OF A STATE OR POLITICAL SUBDIVISION THEREOF, AND STOCK
OR OBLIGATIONS OF A CORPORATION WHICH IS AN INSTRUMENTALITY OR A GOVERN-
MENT SPONSORED ENTERPRISE OF THE UNITED STATES OR OF A  STATE  OR  POLI-
TICAL  SUBDIVISION THEREOF; (C) LOANS SECURED BY A DEPOSIT OR SHARE OF A
MEMBER; (D) LOANS SECURED BY AN INTEREST IN REAL PROPERTY WHICH IS  (OR,
FROM THE PROCEEDS OF THE LOAN, WILL BECOME) RESIDENTIAL REAL PROPERTY OR
REAL  PROPERTY  USED  PRIMARILY  FOR CHURCH PURPOSES, LOANS MADE FOR THE
IMPROVEMENT OF RESIDENTIAL REAL PROPERTY OR REAL PROPERTY USED PRIMARILY
FOR CHURCH PURPOSES, PROVIDED THAT FOR PURPOSES OF THIS SUBCLAUSE, RESI-
DENTIAL REAL PROPERTY SHALL INCLUDE SINGLE  OR  MULTI-FAMILY  DWELLINGS,
FACILITIES  IN RESIDENTIAL DEVELOPMENTS DEDICATED TO PUBLIC USE OR PROP-
ERTY USED ON A NONPROFIT BASIS FOR RESIDENTS, AND MOBILE HOMES NOT  USED
ON  A  TRANSIENT BASIS; (E) PROPERTY ACQUIRED THROUGH THE LIQUIDATION OF
DEFAULTED LOANS DESCRIBED IN SUBCLAUSE (D) OF THIS CLAUSE; (F) ANY REGU-
LAR OR RESIDUAL INTEREST IN A REMIC, AS SUCH TERM IS DEFINED IN  SECTION
860D  OF THE INTERNAL REVENUE CODE, BUT ONLY IN THE PROPORTION WHICH THE
ASSETS OF SUCH REMIC CONSIST OF PROPERTY DESCRIBED IN ANY OF THE PRECED-
ING SUBCLAUSES OF THIS CLAUSE, EXCEPT THAT  IF  NINETY-FIVE  PERCENT  OR
MORE  OF THE ASSETS OF SUCH REMIC ARE ASSETS DESCRIBED IN SUBCLAUSES (A)
THROUGH (E) OF THIS CLAUSE, THE ENTIRE INTEREST IN THE REMIC SHALL QUAL-
IFY; (G) ANY MORTGAGE-BACKED SECURITY WHICH REPRESENTS  OWNERSHIP  OF  A
FRACTIONAL  UNDIVIDED  INTEREST  IN A TRUST, THE ASSETS OF WHICH CONSIST
PRIMARILY OF MORTGAGE LOANS,  PROVIDED  THAT  THE  REAL  PROPERTY  WHICH
SERVES  AS  SECURITY FOR THE LOANS IS (OR FROM THE PROCEEDS OF THE LOAN,
WILL BECOME) THE TYPE OF PROPERTY DESCRIBED IN  SUBCLAUSE  (D)  OF  THIS
CLAUSE  AND  ANY  COLLATERALIZED  MORTGAGE  OBLIGATION, THE SECURITY FOR
WHICH CONSISTS PRIMARILY OF MORTGAGE LOANS THAT MAINTAIN AS SECURITY THE
TYPE OF PROPERTY DESCRIBED IN SUBCLAUSE (D) OF THIS CLAUSE; (H)  CERTIF-
ICATES OF DEPOSIT IN, OR OBLIGATIONS OF, A CORPORATION ORGANIZED UNDER A
STATE  LAW  WHICH SPECIFICALLY AUTHORIZES SUCH CORPORATION TO INSURE THE
DEPOSITS OR SHARE ACCOUNTS OF MEMBER ASSOCIATIONS; (I) LOANS SECURED  BY
AN  INTEREST  IN EDUCATIONAL, HEALTH, OR WELFARE INSTITUTIONS OR FACILI-
TIES, INCLUDING STRUCTURES DESIGNED OR USED  PRIMARILY  FOR  RESIDENTIAL
PURPOSES  FOR  STUDENTS, RESIDENTS, AND PERSONS UNDERCARE, EMPLOYEES, OR
MEMBERS OF THE STAFF OF SUCH INSTITUTIONS OR FACILITIES; (J) LOANS  MADE
FOR  THE PAYMENT OF EXPENSES OF COLLEGE OR UNIVERSITY EDUCATION OR VOCA-
TIONAL TRAINING; (K) PROPERTY USED BY THE TAXPAYER IN SUPPORT  OF  BUSI-
NESS  WHICH  CONSISTS PRINCIPALLY OF ACQUIRING THE SAVINGS OF THE PUBLIC
AND INVESTING IN LOANS; AND (L) LOANS FOR  WHICH  THE  TAXPAYER  IS  THE
CREDITOR  AND  WHICH  ARE WHOLLY SECURED BY LOANS DESCRIBED IN SUBCLAUSE
(D) OF THIS CLAUSE.
  THE VALUE OF ACCRUED INTEREST RECEIVABLE AND ANY LOSS-SHARING  COMMIT-
MENT  OR OTHER LOAN GUARANTY BY A GOVERNMENTAL AGENCY WILL BE CONSIDERED
PART OF THE BASIS IN THE LOANS TO WHICH THE  ACCRUED  INTEREST  OR  LOSS
PROTECTION APPLIES.
  (II)  AT  THE  ELECTION  OF  THE TAXPAYER, THE PERCENTAGE SPECIFIED IN
CLAUSE (I) OF THIS SUBPARAGRAPH SHALL BE APPLIED ON  THE  BASIS  OF  THE
AVERAGE ASSETS OUTSTANDING DURING THE TAXABLE YEAR, IN LIEU OF THE CLOSE
OF  THE TAXABLE YEAR. THE TAXPAYER CAN ELECT TO COMPUTE AN AVERAGE USING
THE ASSETS MEASURED ON THE FIRST DAY OF THE TAXABLE YEAR AND ON THE LAST
DAY OF EACH SUBSEQUENT QUARTER, OR MONTH OR DAY DURING THE TAXABLE YEAR.
THIS ELECTION MAY BE MADE ANNUALLY.

S. 4610--A                         23                         A. 6721--A

  (III) FOR PURPOSES OF SUBCLAUSE (D) OF CLAUSE  (I)  OF  THIS  SUBPARA-
GRAPH,  IF  A  MULTIFAMILY STRUCTURE SECURING A LOAN IS USED IN PART FOR
NONRESIDENTIAL USE PURPOSES, THE ENTIRE LOAN  IS  DEEMED  A  RESIDENTIAL
REAL PROPERTY LOAN IF THE PLANNED RESIDENTIAL USE EXCEEDS EIGHTY PERCENT
OF  THE PROPERTY'S PLANNED USE (MEASURED, AT THE TAXPAYER'S ELECTION, BY
USING SQUARE FOOTAGE OR GROSS RENTAL REVENUE, AND DETERMINED AS  OF  THE
TIME THE LOAN IS MADE).
  (IV) FOR PURPOSES OF SUBCLAUSE (D) OF CLAUSE (I) OF THIS SUBPARAGRAPH,
LOANS  MADE  TO  FINANCE THE ACQUISITION OR DEVELOPMENT OF LAND SHALL BE
DEEMED TO BE LOANS SECURED BY AN INTEREST IN RESIDENTIAL  REAL  PROPERTY
IF  THERE  IS A REASONABLE ASSURANCE THAT THE PROPERTY WILL BECOME RESI-
DENTIAL REAL PROPERTY WITHIN A PERIOD OF THREE YEARS FROM  THE  DATE  OF
ACQUISITION  OF  SUCH  LAND;  BUT  THIS SENTENCE SHALL NOT APPLY FOR ANY
TAXABLE YEAR UNLESS, WITHIN SUCH THREE YEAR PERIOD,  SUCH  LAND  BECOMES
RESIDENTIAL  REAL  PROPERTY.  FOR  PURPOSES  OF  DETERMINING WHETHER ANY
INTEREST IN A REMIC QUALIFIES UNDER SUBCLAUSE (F) OF CLAUSE (I) OF  THIS
SUBPARAGRAPH,  ANY  REGULAR INTEREST IN ANOTHER REMIC HELD BY SUCH REMIC
SHALL BE TREATED AS A LOAN DESCRIBED  IN  A  PRECEDING  SUBCLAUSE  UNDER
PRINCIPLES  SIMILAR  TO THE PRINCIPLE OF SUCH SUBCLAUSE (F), EXCEPT THAT
IF SUCH REMICS ARE PART OF A TIERED STRUCTURE, THEY SHALL BE TREATED  AS
ONE REMIC FOR PURPOSES OF SUCH SUBCLAUSE (F).
  (3)  FOR  PURPOSES  OF  THIS  PARAGRAPH,  A  "THRIFT INSTITUTION" IS A
SAVINGS BANK, A SAVINGS AND LOAN ASSOCIATION, OR OTHER SAVINGS  INSTITU-
TION CHARTERED AND SUPERVISED AS SUCH UNDER FEDERAL OR STATE LAW.
  (T)  SUBTRACTION MODIFICATION FOR QUALIFIED AFFORDABLE HOUSING AND LOW
INCOME COMMUNITY LOANS.
  (1) A TAXPAYER THAT OWNS A  QUALIFYING  LOAN  WITHIN  THE  MEANING  OF
CLAUSE  (III)  OF  SUBPARAGRAPH TWO OF THIS PARAGRAPH SHALL BE ALLOWED A
DEDUCTION IN COMPUTING ENTIRE NET INCOME EQUAL TO  THE  AMOUNT  COMPUTED
UNDER SUBPARAGRAPH TWO OF THIS PARAGRAPH.
  (2)(I)  THE  DEDUCTION  ALLOWED  IN SUBPARAGRAPH ONE OF THIS PARAGRAPH
SHALL BE EQUAL TO:
  (A) IF THE TOTAL AVERAGE VALUE DURING THE TAXABLE YEAR OF  THE  ASSETS
OF  THE  TAXPAYER,  OR IF THE TAXPAYER IS INCLUDED IN A COMBINED REPORT,
THE ASSETS OF THE COMBINED REPORTING GROUP OF THE TAXPAYER UNDER SECTION
11-654.3 OF  THIS  SUBCHAPTER,  DOES  NOT  EXCEED  ONE  HUNDRED  BILLION
DOLLARS, THE TAXPAYER'S NET INTEREST INCOME FROM QUALIFYING LOANS, OR
  (B)  IF  THE TOTAL AVERAGE VALUE DURING THE TAXABLE YEAR OF THE ASSETS
OF THE TAXPAYER, OR IF THE TAXPAYER IS INCLUDED IN  A  COMBINED  REPORT,
THE ASSETS OF THE COMBINED REPORTING GROUP OF THE TAXPAYER UNDER SECTION
11-654.3  OF THIS SUBCHAPTER, EXCEEDS ONE HUNDRED BILLION DOLLARS BUT IS
LESS THAN ONE HUNDRED FIFTY BILLION DOLLARS, THE TAXPAYER'S NET INTEREST
INCOME FROM QUALIFYING LOANS MULTIPLIED BY A FRACTION, THE NUMERATOR  OF
WHICH IS ONE HUNDRED FIFTY BILLION DOLLARS MINUS THE TOTAL AVERAGE VALUE
DURING THE TAXABLE YEAR OF THE ASSETS OF THE TAXPAYER, OR IF THE TAXPAY-
ER  IS INCLUDED IN A COMBINED REPORT, THE ASSETS OF THE COMBINED REPORT-
ING GROUP OF THE TAXPAYER UNDER SECTION 11-654.3 OF THIS SUBCHAPTER, AND
THE DENOMINATOR OF WHICH IS FIFTY BILLION DOLLARS.
  (II)(A) NET INTEREST INCOME  FROM  QUALIFYING  LOANS  SHALL  MEAN  THE
TAXPAYER'S NET INTEREST INCOME FROM LOANS DURING THE TAXABLE YEAR MULTI-
PLIED BY A FRACTION, THE NUMERATOR OF WHICH IS THE GROSS INTEREST INCOME
DURING  THE  TAXABLE  YEAR  FROM QUALIFYING LOANS AND THE DENOMINATOR OF
WHICH IS THE GROSS INTEREST INCOME FROM ALL LOANS.
  (B) NET INTEREST INCOME FROM LOANS SHALL MEAN  GROSS  INTEREST  INCOME
DURING  THE  TAXABLE  YEAR  FROM  LOANS LESS GROSS INTEREST EXPENSE FROM
LOANS. GROSS INTEREST EXPENSE FROM LOANS IS  DETERMINED  BY  MULTIPLYING

S. 4610--A                         24                         A. 6721--A

GROSS  INTEREST  EXPENSE  BY  A  FRACTION, THE NUMERATOR OF WHICH IS THE
AVERAGE TOTAL VALUE OF LOANS OWNED BY THE TAXPAYER  DURING  THE  TAXABLE
YEAR  AND  THE  DENOMINATOR  OF WHICH IS THE AVERAGE TOTAL ASSETS OF THE
TAXPAYER FOR THE YEAR.
  (C) MEASUREMENT OF ASSETS. FOR PURPOSES OF THIS PARAGRAPH:
  (I)  TOTAL  ASSETS  ARE  THOSE ASSETS THAT ARE PROPERLY REFLECTED ON A
BALANCE SHEET, COMPUTED IN THE SAME MANNER AS IS REQUIRED BY THE BANKING
REGULATOR, IF APPLICABLE, OF THE  TAXPAYERS  INCLUDED  IN  THE  COMBINED
RETURN.
  (II)  ASSETS  WILL ONLY BE INCLUDED IF THE INCOME OR EXPENSES OF WHICH
ARE PROPERLY REFLECTED (OR WOULD HAVE BEEN  PROPERLY  REFLECTED  IF  NOT
FULLY  DEPRECIATED  OR EXPENSED, OR DEPRECIATED OR EXPENSED TO A NOMINAL
AMOUNT) IN THE COMPUTATION OF THE TAXPAYER'S ENTIRE NET INCOME  FOR  THE
TAXABLE YEAR. ASSETS WILL NOT INCLUDE DEFERRED TAX ASSETS AND INTANGIBLE
ASSETS IDENTIFIED AS "GOODWILL".
  (III)  TANGIBLE  REAL  AND PERSONAL PROPERTY, SUCH AS BUILDINGS, LAND,
MACHINERY, AND EQUIPMENT, SHALL BE VALUED AT COST. LEASED ASSETS WILL BE
VALUED AT THE ANNUAL LEASE PAYMENT MULTIPLIED BY EIGHT. INTANGIBLE PROP-
ERTY, SUCH AS LOANS AND INVESTMENTS,  SHALL  BE  VALUED  AT  BOOK  VALUE
EXCLUSIVE OF RESERVES.
  (IV)  AVERAGE  ASSETS  ARE  COMPUTED  USING THE ASSETS MEASURED ON THE
FIRST DAY OF THE TAXABLE YEAR, AND ON THE LAST DAY  OF  EACH  SUBSEQUENT
QUARTER OF THE TAXABLE YEAR OR MONTH OR DAY DURING THE TAXABLE YEAR.
  (III)  A QUALIFYING LOAN IS A LOAN THAT MEETS THE CONDITIONS SPECIFIED
IN SUBCLAUSE (A) THROUGH SUBCLAUSE (E) OF THIS CLAUSE.
  (A) THE LOAN IS ORIGINATED BY THE TAXPAYER LENDER OR PURCHASED BY  THE
TAXPAYER  IMMEDIATELY AFTER ITS ORIGINATION IN CONNECTION WITH A COMMIT-
MENT TO PURCHASE MADE BY THE TAXPAYER PRIOR TO THE LOAN'S ORIGINATION.
  (B) SATISFIES CONDITIONS OF ITEM (I) OR (II) OR THIS SUBCLAUSE.
  (I) THE LOAN IS SECURED BY A HOUSING ACCOMMODATION LOCATED WITHIN  THE
CITY,  WHERE  THERE  ARE RENTAL UNITS IN SUCH HOUSING ACCOMMODATION THAT
ARE QUALIFYING UNITS, WHICH FOR PURPOSES OF THIS SUBCLAUSE, MEANS  UNITS
SUBJECT  TO  RENT  CONTROL, RENT STABILIZATION OR TO A REGULATORY AGREE-
MENT, PROVIDED THAT, EACH SUCH LOAN WILL BE CONSIDERED A QUALIFYING LOAN
FOR PURPOSES OF THIS PARAGRAPH ONLY IN PROPORTION TO A PERCENTAGE  EQUAL
TO  THE  NUMBER  OF  QUALIFYING UNITS DIVIDED BY THE TOTAL NUMBER OF ALL
RESIDENTIAL AND COMMERCIAL UNITS LOCATED ON THE SITE OF THE REAL PROPER-
TY SECURING THE LOAN, AS DETERMINED AS OF THE DATE THE LOAN IS MADE.
  (II) TO THE EXTENT NOT INCLUDED IN ITEM (I) OF THIS  SUBCLAUSE,  LOANS
SECURED  BY RESIDENTIAL REAL PROPERTY LOCATED IN A LOW-INCOME COMMUNITY.
FOR PURPOSES OF THIS PARAGRAPH, LOW-INCOME COMMUNITY  AREAS  ARE  CENSUS
TRACTS  WITHIN  THE  CITY IN WHICH THE POVERTY RATE FOR SUCH TRACT IS AT
LEAST TWENTY PERCENT AND THE MEDIAN FAMILY INCOME FOR  SUCH  TRACT  DOES
NOT  EXCEED  EIGHTY  PERCENT  OF METROPOLITAN AREA MEDIAN FAMILY INCOME.
THIS DETERMINATION WILL BE MADE BY REFERENCE TO THE POVERTY  AND  MEDIAN
FAMILY INCOME CENSUS DATA FOR APPLICATION OF SECTION 45D OF THE INTERNAL
REVENUE  CODE OF 1986, AS IN EFFECT ON THE EFFECTIVE DATE OF THE CHAPTER
OF THE LAWS OF TWO THOUSAND FIFTEEN THAT ADDED THIS SUBCHAPTER.
  (C) THE LOAN IS NOT TREATED AS A QUALIFYING LOAN IN THE COMPUTATION OF
A SUBTRACTION FROM ENTIRE NET INCOME PURSUANT TO PARAGRAPH (Q)  OF  THIS
SUBDIVISION.
  (D) IF THE TAXPAYER APPLIES A SUBTRACTION PURSUANT TO PARAGRAPH (R) OF
THIS SUBDIVISION, THE INTEREST OR NET GAINS FROM THE LOAN ARE NOT RECOG-
NIZED BY A CAPTIVE REIT AS DEFINED IN SECTION 11-601 OF THIS CHAPTER.
  (E)  A  LOAN THAT MEETS THE DEFINITION OF A QUALIFYING LOAN IN A PRIOR
TAXABLE YEAR (INCLUDING YEARS PRIOR TO THE EFFECTIVE DATE OF THIS  PARA-

S. 4610--A                         25                         A. 6721--A

GRAPH) REMAINS A QUALIFYING LOAN IN TAXABLE YEARS DURING AND AFTER WHICH
SUCH  LOAN IS ACQUIRED BY ANOTHER CORPORATION IN THE TAXPAYER'S COMBINED
REPORTING GROUP UNDER SECTION 11-654.3 OF THIS SUBCHAPTER.
  (IV) FOR PURPOSES OF THIS PARAGRAPH, THE FOLLOWING TERMS SHALL MEAN:
  (A)  "HOUSING  ACCOMMODATIONS"  SHALL  MEAN  A  MULTIPLE DWELLING THAT
CONTAINS AT LEAST FIVE DWELLING UNITS TOGETHER WITH THE  LAND  ON  WHICH
SUCH STRUCTURE IS SITUATED.
  (B)  "REGULATORY  AGREEMENT"  SHALL  MEAN  A WRITTEN AGREEMENT WITH OR
APPROVED BY ANY LOCAL, MUNICIPAL, STATE,  FEDERAL  OR  OTHER  GOVERNMENT
AGENCY  THAT  REQUIRES THE PROVISION OF HOUSING ACCOMMODATIONS FOR FAMI-
LIES AND PERSONS OF LOW OR MODERATE INCOME, AND BINDS THE OWNER OF  SUCH
REAL PROPERTY AND ITS SUCCESSORS AND ASSIGNS. A REGULATORY AGREEMENT MAY
INCLUDE  SUCH  OTHER TERMS AND CONDITIONS AS THE LOCALITY, MUNICIPALITY,
STATE, OR FEDERAL GOVERNMENT SHALL DETERMINE.
  (C) "RENT STABILIZATION" SHALL MEAN, COLLECTIVELY, THE RENT STABILIZA-
TION LAW OF NINETEEN HUNDRED SIXTY-NINE, THE  RENT  STABILIZATION  CODE,
AND THE EMERGENCY TENANT PROTECTION ACT OF NINETEEN SEVENTY-FOUR, ALL AS
IN  EFFECT  AS  OF  THE EFFECTIVE DATE OF THE CHAPTER OF THE LAWS OF TWO
THOUSAND FIFTEEN THAT ADDED THIS SUBCHAPTER OR  AS  AMENDED  THEREAFTER,
TOGETHER  WITH ANY SUCCESSOR STATUTES OR REGULATIONS ADDRESSING SUBSTAN-
TIALLY THE SAME SUBJECT MATTER.
  9. (A) THE TERM "CALENDAR YEAR" MEANS  A  PERIOD  OF  TWELVE  CALENDAR
MONTHS (OR ANY SHORTER PERIOD BEGINNING ON THE DATE THE TAXPAYER BECOMES
SUBJECT   TO   THE  TAX  IMPOSED  BY  THIS  SUBCHAPTER)  ENDING  ON  THE
THIRTY-FIRST DAY OF DECEMBER, PROVIDED THE TAXPAYER KEEPS ITS  BOOKS  ON
THE BASIS OF SUCH PERIOD OR ON THE BASIS OF ANY PERIOD ENDING ON ANY DAY
OTHER  THAN  THE  LAST DAY OF A CALENDAR MONTH, OR PROVIDED THE TAXPAYER
DOES NOT KEEP BOOKS, AND INCLUDES, IN  CASE  THE  TAXPAYER  CHANGES  THE
PERIOD  ON THE BASIS OF WHICH IT KEEPS ITS BOOKS FROM A FISCAL YEAR TO A
CALENDAR YEAR, THE PERIOD FROM THE CLOSE OF ITS LAST OLD FISCAL YEAR  UP
TO AND INCLUDING THE FOLLOWING DECEMBER THIRTY-FIRST.
  (B)  THE  TERM  "FISCAL YEAR" MEANS A PERIOD OF TWELVE CALENDAR MONTHS
(OR ANY SHORTER PERIOD  BEGINNING  ON  THE  DATE  THE  TAXPAYER  BECOMES
SUBJECT TO THE TAX IMPOSED BY THIS SUBCHAPTER) ENDING ON THE LAST DAY OF
ANY  MONTH OTHER THAN DECEMBER, PROVIDED THE TAXPAYER KEEPS ITS BOOKS ON
THE BASIS OF SUCH PERIOD, AND INCLUDES, IN CASE THE TAXPAYER CHANGES THE
PERIOD ON THE BASIS OF WHICH IT KEEPS ITS BOOKS FROM A CALENDAR YEAR  TO
A FISCAL YEAR OR FROM ONE FISCAL YEAR TO ANOTHER FISCAL YEAR, THE PERIOD
FROM  THE  CLOSE  OF ITS LAST OLD CALENDAR OR FISCAL YEAR UP TO THE DATE
DESIGNATED AS THE CLOSE OF ITS NEW FISCAL YEAR.
  10. THE TERM "TANGIBLE PERSONAL  PROPERTY"  MEANS  CORPOREAL  PERSONAL
PROPERTY,  SUCH  AS  MACHINERY,  TOOLS,  IMPLEMENTS,  GOODS,  WARES  AND
MERCHANDISE, AND DOES NOT MEAN  MONEY,  DEPOSITS  IN  BANKS,  SHARES  OF
STOCK,  BONDS,  NOTES,  CREDITS OR EVIDENCES OF AN INTEREST PROPERTY AND
EVIDENCES OF DEBT.
  11. THE TERM "INTERNAL REVENUE CODE" MEANS, UNLESS  OTHERWISE  SPECIF-
ICALLY  STATED IN THIS SUBCHAPTER, THE INTERNAL REVENUE CODE OF 1986, AS
AMENDED.
  12. THE TERM "COMBINABLE CAPTIVE INSURANCE COMPANY"  MEANS  AN  ENTITY
THAT  IS  TREATED  AS  AN ASSOCIATION TAXABLE AS A CORPORATION UNDER THE
INTERNAL REVENUE CODE: (A) MORE THAN FIFTY PERCENT OF THE  VOTING  STOCK
OF  WHICH  IS  OWNED  OR CONTROLLED, DIRECTLY OR INDIRECTLY, BY A SINGLE
ENTITY THAT IS TREATED AS AN ASSOCIATION TAXABLE AS A CORPORATION  UNDER
THE INTERNAL REVENUE CODE AND NOT EXEMPT FROM FEDERAL INCOME TAX;
  (B)  THAT IS LICENSED AS A CAPTIVE INSURANCE COMPANY UNDER THE LAWS OF
THIS STATE OR ANOTHER JURISDICTION;

S. 4610--A                         26                         A. 6721--A

  (C) WHOSE BUSINESS INCLUDES PROVIDING, DIRECTLY AND INDIRECTLY, INSUR-
ANCE OR REINSURANCE COVERING THE RISKS OF ITS PARENT AND/OR  MEMBERS  OF
ITS AFFILIATED GROUP; AND
  (D) FIFTY PERCENT OR LESS OF WHOSE GROSS RECEIPTS FOR THE TAXABLE YEAR
CONSIST  OF  PREMIUMS  FROM  ARRANGEMENTS  THAT CONSTITUTE INSURANCE FOR
FEDERAL INCOME TAX PURPOSES.
  FOR PURPOSES OF THIS SUBDIVISION,  "AFFILIATED  GROUP"  HAS  THE  SAME
MEANING  AS  THAT  TERM  IS GIVEN IN SECTION FIFTEEN HUNDRED FOUR OF THE
INTERNAL REVENUE CODE, EXCEPT THAT THE TERM "COMMON PARENT  CORPORATION"
IN  THAT  SECTION  IS  DEEMED  TO MEAN ANY PERSON, AS DEFINED IN SECTION
SEVEN THOUSAND SEVEN HUNDRED ONE OF THE INTERNAL REVENUE CODE AND REFER-
ENCES TO "AT LEAST EIGHTY PERCENT" IN SECTION FIFTEEN  HUNDRED  FOUR  OF
THE  INTERNAL  REVENUE  CODE  ARE TO BE READ AS "FIFTY PERCENT OR MORE;"
SECTION FIFTEEN HUNDRED FOUR OF THE INTERNAL REVENUE CODE IS TO BE  READ
WITHOUT  REGARD TO THE EXCLUSIONS PROVIDED FOR IN SUBSECTION (B) OF THAT
SECTION; "PREMIUMS" HAS THE SAME MEANING AS THAT TERM IS GIVEN IN  PARA-
GRAPH  ONE  OF SUBDIVISION (C) OF SECTION FIFTEEN HUNDRED TEN OF THE TAX
LAW, EXCEPT THAT IT INCLUDES CONSIDERATION  FOR  ANNUITY  CONTRACTS  AND
EXCLUDES  ANY  PART  OF  THE CONSIDERATION FOR INSURANCE, REINSURANCE OR
ANNUITY CONTRACTS THAT DO NOT PROVIDE BONA FIDE  INSURANCE,  REINSURANCE
OR  ANNUITY BENEFITS; AND "GROSS RECEIPTS" INCLUDES THE AMOUNTS INCLUDED
IN GROSS RECEIPTS FOR PURPOSES OF PARAGRAPH FIFTEEN OF SUBSECTION (C) OF
SECTION FIVE HUNDRED ONE OF THE INTERNAL REVENUE CODE, EXCEPT THAT THOSE
AMOUNTS ALSO INCLUDE ALL PREMIUMS AS DEFINED IN THIS SUBDIVISION.
  13. THE TERM "PARTNERSHIP" INCLUDES A SYNDICATE,  GROUP,  POOL,  JOINT
VENTURE,  OR  OTHER  UNINCORPORATED ORGANIZATION, THROUGH OR BY MEANS OF
WHICH ANY BUSINESS, FINANCIAL OPERATION, OR VENTURE IS CARRIED  ON,  AND
WHICH  IS  NOT  A  CORPORATION  AS  DEFINED  IN  SUBDIVISION ONE OF THIS
SECTION, OR A TRUST OR ESTATE THAT IS SEPARATE FROM ITS OWNER UNDER PART
ONE OF SUBCHAPTER J OF CHAPTER ONE OF SUBTITLE A OF THE INTERNAL REVENUE
CODE; AND THE TERM "PARTNER" INCLUDES A MEMBER IN SUCH SYNDICATE, GROUP,
POOL, JOINT VENTURE, OR ORGANIZATION.
  S 11-653 IMPOSITION OF TAX; EXEMPTIONS. 1. (A) FOR  THE  PRIVILEGE  OF
DOING BUSINESS, OR OF EMPLOYING CAPITAL, OR OF OWNING OR LEASING PROPER-
TY  IN  THE CITY IN A CORPORATE OR ORGANIZED CAPACITY, OR OF MAINTAINING
AN OFFICE IN THE CITY, FOR ALL OR ANY PART OF  EACH  OF  ITS  FISCAL  OR
CALENDAR  YEARS,  EVERY  DOMESTIC  OR FOREIGN CORPORATION, EXCEPT CORPO-
RATIONS SPECIFIED IN SUBDIVISION FOUR OF THIS  SECTION,  SHALL  ANNUALLY
PAY  A  TAX,  UPON  THE BASIS OF ITS BUSINESS INCOME, OR UPON SUCH OTHER
BASIS AS MAY BE APPLICABLE AS HEREINAFTER PROVIDED, FOR SUCH  FISCAL  OR
CALENDAR  YEAR OR PART THEREOF, ON A REPORT WHICH SHALL BE FILED, EXCEPT
AS HEREINAFTER PROVIDED, ON OR BEFORE THE FIFTEENTH DAY  OF  MARCH  NEXT
SUCCEEDING  THE  CLOSE  OF EACH SUCH YEAR, OR, IN THE CASE OF A TAXPAYER
WHICH REPORTS ON THE BASIS OF A FISCAL YEAR,  WITHIN  TWO  AND  ONE-HALF
MONTHS AFTER THE CLOSE OF SUCH FISCAL YEAR, AND SHALL BE PAID AS HEREIN-
AFTER PROVIDED.
  (B) INTENTIONALLY OMITTED.
  (C)  A  CORPORATION IS DOING BUSINESS IN THE CITY IF (1) IT HAS ISSUED
CREDIT CARDS TO ONE THOUSAND  OR  MORE  CUSTOMERS  WHO  HAVE  A  MAILING
ADDRESS  WITHIN  THE CITY AS OF THE LAST DAY OF ITS TAXABLE YEAR, (2) IT
HAS MERCHANT CUSTOMER CONTRACTS WITH MERCHANTS AND THE TOTAL  NUMBER  OF
LOCATIONS  COVERED  BY  THOSE  CONTRACTS  EQUALS  ONE  THOUSAND  OR MORE
LOCATIONS IN THE CITY TO WHOM  THE  CORPORATION  REMITTED  PAYMENTS  FOR
CREDIT  CARD TRANSACTIONS DURING THE TAXABLE YEAR, OR (3) THE SUM OF THE
NUMBER OF CUSTOMERS DESCRIBED IN SUBPARAGRAPH ONE OF THIS PARAGRAPH PLUS
THE NUMBER OF LOCATIONS COVERED BY ITS CONTRACTS DESCRIBED  IN  SUBPARA-

S. 4610--A                         27                         A. 6721--A

GRAPH TWO OF THIS PARAGRAPH EQUALS ONE THOUSAND OR MORE. AS USED IN THIS
SUBDIVISION,  THE  TERM  "CREDIT CARD" INCLUDES BANK, CREDIT, TRAVEL AND
ENTERTAINMENT CARDS.
  (D) INTENTIONALLY OMITTED.
  (E) INTENTIONALLY OMITTED.
  (F)  IF  A PARTNERSHIP IS DOING BUSINESS, EMPLOYING CAPITAL, OWNING OR
LEASING PROPERTY IN THE CITY, OR MAINTAINING AN OFFICE IN THE CITY,  ANY
CORPORATION  THAT  IS  A PARTNER IN SUCH PARTNERSHIP SHALL BE SUBJECT TO
TAX UNDER THIS SUBCHAPTER AS DESCRIBED IN THE REGULATIONS OF THE COMMIS-
SIONER OF FINANCE.
  2. A FOREIGN CORPORATION SHALL NOT BE DEEMED  TO  BE  DOING  BUSINESS,
EMPLOYING  CAPITAL, OWNING OR LEASING PROPERTY, OR MAINTAINING AN OFFICE
IN THE CITY, FOR THE PURPOSES OF THIS SUBCHAPTER, BY REASON OF:
  (A) THE MAINTENANCE OF CASH BALANCES WITH BANKS OR TRUST COMPANIES  IN
THE CITY, OR
  (B)  THE  OWNERSHIP OF SHARES OF STOCK OR SECURITIES KEPT IN THE CITY,
IF KEPT IN A SAFE DEPOSIT BOX, SAFE, VAULT OR  OTHER  RECEPTACLE  RENTED
FOR  THE  PURPOSE, OR IF PLEDGED AS COLLATERAL SECURITY, OR IF DEPOSITED
WITH ONE OR MORE BANKS OR TRUST COMPANIES, OR BROKERS WHO ARE MEMBERS OF
A RECOGNIZED SECURITY EXCHANGE, IN SAFEKEEPING OR CUSTODY ACCOUNTS, OR
  (C) THE TAKING OF ANY ACTION BY ANY SUCH  BANK  OR  TRUST  COMPANY  OR
BROKER, WHICH IS INCIDENTAL TO THE RENDERING OF SAFEKEEPING OR CUSTODIAN
SERVICE TO SUCH CORPORATION, OR
  (D)  THE  MAINTENANCE OF AN OFFICE IN THE CITY BY ONE OR MORE OFFICERS
OR DIRECTORS OF THE CORPORATION WHO ARE NOT EMPLOYEES OF THE CORPORATION
IF THE CORPORATION OTHERWISE IS NOT DOING BUSINESS IN THE CITY, AND DOES
NOT EMPLOY CAPITAL OR OWN OR LEASE PROPERTY IN THE CITY, OR
  (E) THE KEEPING OF BOOKS OR RECORDS OF A CORPORATION IN  THE  CITY  IF
SUCH  BOOKS OR RECORDS ARE NOT KEPT BY EMPLOYEES OF SUCH CORPORATION AND
SUCH CORPORATION DOES NOT OTHERWISE DO BUSINESS, EMPLOY CAPITAL, OWN  OR
LEASE PROPERTY OR MAINTAIN AN OFFICE IN THE CITY, OR
  (F) ANY COMBINATION OF THE FOREGOING ACTIVITIES.
  2-A.  AN  ALIEN  CORPORATION SHALL NOT BE DEEMED TO BE DOING BUSINESS,
EMPLOYING CAPITAL, OWNING OR LEASING PROPERTY, OR MAINTAINING AN  OFFICE
IN  THE  CITY, FOR THE PURPOSES OF THIS SUBCHAPTER, IF ITS ACTIVITIES IN
THE CITY ARE LIMITED SOLELY TO:
  (A) INVESTING OR TRADING IN STOCKS AND SECURITIES FOR ITS OWN  ACCOUNT
WITHIN  THE  MEANING OF CLAUSE (II) OF SUBPARAGRAPH (A) OF PARAGRAPH (2)
OF SUBSECTION (B) OF SECTION EIGHT HUNDRED SIXTY-FOUR  OF  THE  INTERNAL
REVENUE CODE, OR:
  (B) INVESTING OR TRADING IN COMMODITIES FOR ITS OWN ACCOUNT WITHIN THE
MEANING  OF  CLAUSE  (II)  OF  SUBPARAGRAPH  (B)  OF  PARAGRAPH  (2)  OF
SUBSECTION (B) OF SECTION  EIGHT  HUNDRED  SIXTY-FOUR  OF  THE  INTERNAL
REVENUE CODE, OR
  (C)  ANY COMBINATION OF ACTIVITIES DESCRIBED IN PARAGRAPHS (A) AND (B)
OF THIS SUBDIVISION.
  AN ALIEN CORPORATION THAT UNDER ANY PROVISION OF THE INTERNAL  REVENUE
CODE  IS  NOT  TREATED AS A "DOMESTIC CORPORATION" AS DEFINED IN SECTION
SEVEN THOUSAND SEVEN HUNDRED ONE OF SUCH CODE  AND  HAS  NO  EFFECTIVELY
CONNECTED  INCOME  FOR  THE TAXABLE YEAR PURSUANT TO CLAUSE THREE OF THE
OPENING PARAGRAPH  OF  SUBDIVISION  EIGHT  OF  SECTION  11-652  OF  THIS
SUBCHAPTER  SHALL  NOT  BE SUBJECT TO TAX UNDER THIS SUBCHAPTER FOR THAT
TAXABLE YEAR. FOR PURPOSES OF THIS SUBCHAPTER, AN ALIEN CORPORATION IS A
CORPORATION ORGANIZED UNDER THE LAWS OF  A  COUNTRY,  OR  ANY  POLITICAL
SUBDIVISION  THEREOF,  OTHER  THAN THE UNITED STATES, OR ORGANIZED UNDER

S. 4610--A                         28                         A. 6721--A

THE LAWS OF A  POSSESSION,  TERRITORY  OR  COMMONWEALTH  OF  THE  UNITED
STATES.
  3. ANY RECEIVER, REFEREE, TRUSTEE, ASSIGNEE OR OTHER FIDUCIARY, OR ANY
OFFICER  OR  AGENT  APPOINTED BY ANY COURT, WHO CONDUCTS THE BUSINESS OF
ANY CORPORATION, SHALL BE SUBJECT TO THE TAX IMPOSED BY THIS  SUBCHAPTER
IN  THE  SAME  MANNER  AND  TO  THE  SAME EXTENT AS IF THE BUSINESS WERE
CONDUCTED BY THE AGENTS OR OFFICERS OF  SUCH  CORPORATION.  A  DISSOLVED
CORPORATION WHICH CONTINUES TO CONDUCT BUSINESS SHALL ALSO BE SUBJECT TO
THE TAX IMPOSED BY THIS SUBCHAPTER.
  4. (A) CORPORATIONS SUBJECT TO TAX UNDER CHAPTER ELEVEN OF THIS TITLE,
ANY  TRUST  COMPANY ORGANIZED UNDER A LAW OF THIS STATE ALL OF THE STOCK
OF WHICH IS OWNED BY NOT LESS THAN TWENTY SAVINGS BANKS ORGANIZED  UNDER
A  LAW OF THIS STATE, HOUSING COMPANIES ORGANIZED AND OPERATING PURSUANT
TO THE PROVISIONS OF ARTICLE TWO OF THE  PRIVATE  HOUSING  FINANCE  LAW,
HOUSING  DEVELOPMENT FUND COMPANIES ORGANIZED PURSUANT TO THE PROVISIONS
OF ARTICLE ELEVEN OF  THE  PRIVATE  HOUSING  FINANCE  LAW,  CORPORATIONS
DESCRIBED  IN  SECTION  THREE  OF THE TAX LAW, A CORPORATION PRINCIPALLY
ENGAGED IN THE OPERATION OF MARINE VESSELS WHOSE ACTIVITIES IN THE  CITY
ARE  LIMITED EXCLUSIVELY TO THE USE OF PROPERTY IN INTERSTATE OR FOREIGN
COMMERCE, PROVIDED, HOWEVER, SUCH A CORPORATION WILL NOT BE  SUBJECT  TO
TAX  UNDER  THIS SUBCHAPTER SOLELY BECAUSE IT MAINTAINS AN OFFICE IN THE
CITY, OR EMPLOYS CAPITAL IN THE CITY, IN CONNECTION  WITH  SUCH  USE  OF
PROPERTY,  A  CORPORATION  PRINCIPALLY ENGAGED IN THE CONDUCT OF A FERRY
BUSINESS AND OPERATING BETWEEN ANY OF THE BOROUGHS OF THE CITY  UNDER  A
LEASE  GRANTED  BY THE CITY AND A CORPORATION PRINCIPALLY ENGAGED IN THE
CONDUCT OF AN AVIATION, STEAMBOAT, FERRY OR NAVIGATION BUSINESS, OR  TWO
OR  MORE  OF SUCH BUSINESSES, ALL OF THE CAPITAL STOCK OF WHICH IS OWNED
BY A MUNICIPAL CORPORATION OF THIS STATE, SHALL NOT BE  SUBJECT  TO  TAX
UNDER  THIS  SUBCHAPTER;  PROVIDED, HOWEVER, THAT ANY CORPORATION, OTHER
THAN (1) A UTILITY CORPORATION SUBJECT TO THE SUPERVISION OF  THE  STATE
DEPARTMENT  OF PUBLIC SERVICE, AND (2) FOR TAXABLE YEARS BEGINNING ON OR
AFTER AUGUST FIRST, TWO THOUSAND TWO, A UTILITY AS DEFINED  IN  SUBDIVI-
SION SIX OF SECTION 11-1101 OF THIS TITLE, WHICH IS SUBJECT TO TAX UNDER
CHAPTER  ELEVEN  OF THIS TITLE AS A VENDOR OF UTILITY SERVICES, SHALL BE
SUBJECT TO TAX UNDER THIS SUBCHAPTER, BUT IN COMPUTING THE  TAX  IMPOSED
BY THIS SECTION PURSUANT TO THE PROVISIONS OF CLAUSE (I) OF SUBPARAGRAPH
ONE  OF  PARAGRAPH  (E)  OF  SUBDIVISION  ONE  OF SECTION 11-654 OF THIS
SUBCHAPTER, BUSINESS INCOME ALLOCATED TO THE CITY PURSUANT TO  PARAGRAPH
(A)  OF  SUBDIVISION  THREE  OF  SUCH  SECTION  SHALL  BE REDUCED BY THE
PERCENTAGE WHICH SUCH CORPORATION'S GROSS OPERATING  INCOME  SUBJECT  TO
TAX UNDER CHAPTER ELEVEN OF THIS TITLE IS OF ITS GROSS OPERATING INCOME.
  (B)  THE  TERM "GROSS OPERATING INCOME", WHEN USED IN PARAGRAPH (A) OF
THIS SUBDIVISION, MEANS RECEIPTS RECEIVED IN OR BY REASON OF ANY  TRANS-
ACTION  HAD  AND  CONSUMMATED  IN  THE CITY, INCLUDING CASH, CREDITS AND
PROPERTY OF ANY KIND OR NATURE (WHETHER OR NOT SUCH TRANSACTION IS  MADE
FOR  PROFIT),  WITHOUT ANY DEDUCTION THEREFROM ON ACCOUNT OF THE COST OF
THE PROPERTY SOLD, THE COST OF MATERIALS USED, LABOR OR OTHER  SERVICES,
DELIVERY  COSTS OR ANY OTHER COSTS WHATSOEVER, INTEREST OR DISCOUNT PAID
OR ANY OTHER EXPENSES WHATSOEVER.
  (C) IF IT SHALL APPEAR TO THE COMMISSIONER OF FINANCE THAT THE  APPLI-
CATION  OF  THE  PROVISO  OF PARAGRAPH (A) OF THIS SUBDIVISION, DOES NOT
FAIRLY AND EQUITABLY REFLECT THE  PORTION  OF  THE  TAXPAYER'S  BUSINESS
INCOME  ALLOCABLE  TO  THE CITY WHICH IS ATTRIBUTABLE TO ITS CITY ACTIV-
ITIES WHICH ARE NOT TAXABLE UNDER CHAPTER  ELEVEN  OF  THIS  TITLE,  THE
COMMISSIONER  OF  FINANCE MAY PRESCRIBE OTHER MEANS OR METHODS OF DETER-
MINING SUCH PORTION, INCLUDING THE USE OF THE BOOKS AND RECORDS  OF  THE

S. 4610--A                         29                         A. 6721--A

TAXPAYER,  IF THE COMMISSIONER OF FINANCE FINDS THAT SUCH MEANS OR METH-
ODS USED IN KEEPING THEM FAIRLY AND EQUITABLY REFLECT SUCH PORTION.
  5. INTENTIONALLY OMITTED.
  6. INTENTIONALLY OMITTED.
  7.  FOR ANY TAXABLE YEAR OF A REAL ESTATE INVESTMENT TRUST, AS DEFINED
IN SECTION EIGHT HUNDRED FIFTY-SIX OF  THE  INTERNAL  REVENUE  CODE,  IN
WHICH  SUCH  TRUST  IS  SUBJECT TO FEDERAL INCOME TAXATION UNDER SECTION
EIGHT HUNDRED FIFTY-SEVEN OF SUCH CODE, SUCH TRUST SHALL BE SUBJECT TO A
TAX COMPUTED UNDER EITHER CLAUSE (I) OF SUBPARAGRAPH  ONE  OF  PARAGRAPH
(E)  OF  SUBDIVISION ONE OF SECTION 11-654 OF THIS SUBCHAPTER, OR CLAUSE
(IV), WHICHEVER IS GREATER. IN THE CASE OF SUCH A REAL ESTATE INVESTMENT
TRUST, INCLUDING A CAPTIVE REIT AS DEFINED IN  SECTION  11-601  OF  THIS
CHAPTER,  THE  TERM  "ENTIRE  NET  INCOME" MEANS "REAL ESTATE INVESTMENT
TRUST TAXABLE INCOME" AS DEFINED IN PARAGRAPH TWO OF SUBDIVISION (B)  OF
SECTION  EIGHT HUNDRED FIFTY-SEVEN (AS MODIFIED BY SECTION EIGHT HUNDRED
FIFTY-EIGHT) OF THE INTERNAL REVENUE CODE PLUS THE AMOUNT TAXABLE  UNDER
PARAGRAPH  THREE OF SUBDIVISION (B) OF SECTION EIGHT HUNDRED FIFTY-SEVEN
OF SUCH CODE, SUBJECT TO THE MODIFICATIONS REQUIRED BY SUBDIVISION EIGHT
OF  SECTION  11-652  OF  THIS  SUBCHAPTER  INCLUDING  THE  MODIFICATIONS
REQUIRED  BY  PARAGRAPHS  (D)  AND  (E)  OF SUBDIVISION THREE OF SECTION
11-654 OF THIS SUBCHAPTER.
  8. FOR ANY TAXABLE YEAR OF A REGULATED INVESTMENT COMPANY, AS  DEFINED
IN  SECTION  EIGHT  HUNDRED  FIFTY-ONE  OF THE INTERNAL REVENUE CODE, IN
WHICH SUCH COMPANY IS SUBJECT TO FEDERAL INCOME TAXATION  UNDER  SECTION
EIGHT HUNDRED FIFTY-TWO OF SUCH CODE, SUCH COMPANY SHALL BE SUBJECT TO A
TAX  COMPUTED  UNDER  EITHER  CLAUSE  ONE OR FOUR OF SUBPARAGRAPH (A) OF
PARAGRAPH E OF SUBDIVISION ONE OF SECTION  11-654  OF  THIS  SUBCHAPTER,
WHICHEVER  IS GREATER. IN THE CASE OF SUCH A REGULATED INVESTMENT COMPA-
NY, INCLUDING A CAPTIVE RIC AS DEFINED IN SECTION 11-601 OF  THIS  CHAP-
TER,  THE  TERM  "ENTIRE  NET  INCOME"  USED  IN SUBDIVISION ONE OF THIS
SECTION MEANS "INVESTMENT COMPANY TAXABLE INCOME" AS  DEFINED  IN  PARA-
GRAPH  TWO  OF  SUBDIVISION  (B)  OF SECTION EIGHT HUNDRED FIFTY-TWO, AS
MODIFIED BY SECTION EIGHT HUNDRED FIFTY-FIVE, OF  THE  INTERNAL  REVENUE
CODE PLUS THE AMOUNT TAXABLE UNDER PARAGRAPH THREE OF SUBDIVISION (B) OF
SECTION  EIGHT  HUNDRED  FIFTY-TWO OF SUCH CODE SUBJECT TO THE MODIFICA-
TIONS REQUIRED BY SUBDIVISION EIGHT OF SECTION 11-652 OF  THIS  SUBCHAP-
TER,  INCLUDING  THE  MODIFICATION REQUIRED BY PARAGRAPHS (D) AND (E) OF
SUBDIVISION THREE OF SECTION 11-654 OF THIS SUBCHAPTER.
  9. AN ORGANIZATION  DESCRIBED  IN  PARAGRAPH  TWO  OR  TWENTY-FIVE  OF
SUBSECTION  (C) OF SECTION FIVE HUNDRED ONE OF THE INTERNAL REVENUE CODE
SHALL BE EXEMPT FROM ALL TAXES IMPOSED BY THIS SUBCHAPTER.
  S 11-654 COMPUTATION OF TAX. 1. (A) INTENTIONALLY OMITTED.
  (B) INTENTIONALLY OMITTED.
  (C) INTENTIONALLY OMITTED.
  (D) INTENTIONALLY OMITTED.
  (E) THE TAX IMPOSED BY SUBDIVISION  ONE  OF  SECTION  11-653  OF  THIS
SUBCHAPTER SHALL BE, IN THE CASE OF EACH TAXPAYER:
  (1) WHICHEVER OF THE FOLLOWING AMOUNTS IS THE GREATEST:
  (I)  AN  AMOUNT COMPUTED ON ITS BUSINESS INCOME OR THE PORTION OF SUCH
BUSINESS INCOME ALLOCATED  WITHIN  THE  CITY  AS  HEREINAFTER  PROVIDED,
SUBJECT TO THE APPLICATION OF PARAGRAPHS (J) AND (K) OF THIS SUBDIVISION
AND  ANY  MODIFICATION REQUIRED BY PARAGRAPHS (D) AND (E) OF SUBDIVISION
THREE OF THIS SECTION, AT THE RATE OF (1) NINE PER CENTUM FOR  FINANCIAL
CORPORATIONS,  AS  DEFINED  IN THIS CLAUSE, OR (2) EIGHT AND EIGHTY-FIVE
ONE HUNDREDTHS PER CENTUM FOR ALL OTHER CORPORATIONS.  FOR  PURPOSES  OF
THIS  CLAUSE,  "FINANCIAL  CORPORATION"  MEANS  A CORPORATION OR, IF THE

S. 4610--A                         30                         A. 6721--A

CORPORATION IS INCLUDED IN A COMBINED GROUP, A COMBINED GROUP, THAT  (A)
HAS  TOTAL ASSETS REFLECTED ON ITS BALANCE SHEET AT THE END OF ITS TAXA-
BLE YEAR IN EXCESS OF ONE HUNDRED BILLION DOLLARS, COMPUTED UNDER GENER-
ALLY ACCEPTED ACCOUNTING PRINCIPLES AND (B)(I) ALLOCATES MORE THAN FIFTY
PERCENT  OF  THE  RECEIPTS  INCLUDED  IN THE DENOMINATOR OF ITS RECEIPTS
FRACTION, DETERMINED UNDER SECTION 11-654.2 OF THIS SUBCHAPTER, PURSUANT
TO SUBDIVISION FIVE OF SECTION 11-654.2 OF THIS SUBCHAPTER FOR ITS TAXA-
BLE YEAR, OR (II) IS ITSELF OR IS INCLUDED IN A COMBINED GROUP IN  WHICH
MORE  THAN  FIFTY  PERCENT  OF THE TOTAL ASSETS REFLECTED ON ITS BALANCE
SHEET AT THE END OF ITS TAXABLE YEAR ARE HELD  BY  ONE  OR  MORE  CORPO-
RATIONS  THAT ARE CLASSIFIED AS (A) REGISTERED UNDER STATE LAW AS A BANK
HOLDING COMPANY OR REGISTERED UNDER THE FEDERAL BANK HOLDING COMPANY ACT
OF 1956 (12 U.S.C. S 1841, ET SEQ., AS  AMENDED),  OR  REGISTERED  AS  A
SAVINGS  AND LOAN HOLDING COMPANY UNDER THE FEDERAL NATIONAL HOUSING ACT
(12 U.S.C. 1701, AS AMENDED), (B) A NATIONAL BANK ORGANIZED AND EXISTING
AS A NATIONAL  BANK  ASSOCIATION  PURSUANT  TO  THE  PROVISIONS  OF  THE
NATIONAL  BANK  ACT, 12 U.S.C. 21 ET. SEQ., (C) A SAVINGS ASSOCIATION OR
FEDERAL SAVINGS BANK AS DEFINED IN THE FEDERAL DEPOSIT INSURANCE ACT, 12
U.S.C. S 1813(B)(1), (D) A BANK, SAVINGS ASSOCIATION, OR THRIFT INSTITU-
TION INCORPORATED OR ORGANIZED UNDER THE LAWS OF ANY STATE, (E) A CORPO-
RATION ORGANIZED UNDER THE PROVISIONS OF 12 U.S.C. SS 611 TO 631, (F) AN
AGENCY OR BRANCH OR A FOREIGN DEPOSITORY AS DEFINED IN 12 U.S.C. S 3101,
(G) A REGISTERED SECURITIES OR COMMODITIES BROKER OR  DEALER  REGISTERED
AS  SUCH  BY  THE  SECURITIES AND EXCHANGE COMMISSION OR THE COMMODITIES
FUTURES TRADING COMMISSION, WHICH SHALL INCLUDE AN OTC DERIVATIVES DEAL-
ER AS DEFINED UNDER REGULATIONS OF THE SECURITIES AND  EXCHANGE  COMMIS-
SION  AT  TITLE 17, PART 240, SECTION 3B-12 OF THE CODE OF FEDERAL REGU-
LATIONS (17 CFR 240.3B-12), OR (H) ANY CORPORATION WHOSE VOTING STOCK IS
MORE THAN FIFTY PERCENT OWNED, DIRECTLY OR INDIRECTLY, BY ANY PERSON  OR
BUSINESS  ENTITY  DESCRIBED  IN  SUBITEMS  (A) THROUGH (G) OF THIS ITEM,
OTHER THAN AN INSURANCE COMPANY TAXABLE UNDER  ARTICLE  THIRTY-THREE  OF
THE TAX LAW; OR
  (II)  AN AMOUNT COMPUTED BY MULTIPLYING ITS TOTAL BUSINESS CAPITAL, OR
THE PORTION THEREOF ALLOCATED WITHIN THE CITY, AS HEREINAFTER PROVIDED,
  (A) EXCEPT AS PROVIDED IN SUBCLAUSES (B) AND (C) OF  THIS  CLAUSE,  BY
FIFTEEN ONE-HUNDREDTHS PER CENTUM;
  (B) IN THE CASE OF A COOPERATIVE HOUSING CORPORATION AS DEFINED IN THE
INTERNAL REVENUE CODE, BY FOUR ONE-HUNDREDTHS PER CENTUM;
  (C)  IN  THE  CASE  OF  THE PORTION OF TOTAL BUSINESS CAPITAL DIRECTLY
ATTRIBUTABLE TO A CORPORATION THAT IS OR WOULD BE TAXABLE UNDER  CHAPTER
ELEVEN  OF  THIS  TITLE (EXCEPT FOR A VENDOR OF UTILITY SERVICES THAT IS
TAXABLE UNDER BOTH CHAPTER ELEVEN OF THIS TITLE AND THIS SUBCHAPTER)  OR
A  CORPORATION  THAT WOULD HAVE BEEN TAXABLE AS AN INSURANCE CORPORATION
UNDER FORMER PART IV, TITLE R, CHAPTER FORTY-SIX OF  THE  ADMINISTRATIVE
CODE  OF  THE  CITY OF NEW YORK AS IN EFFECT ON JUNE THIRTIETH, NINETEEN
HUNDRED SEVENTY-FOUR, BY SEVEN AND ONE-HALF ONE-HUNDREDTHS  PER  CENTUM;
AND
  (D) SUBTRACTING TEN THOUSAND DOLLARS FROM THE SUM OF THE AMOUNT OF TAX
COMPUTED  PURSUANT  TO  SUBCLAUSES  (A),  (B)  AND  (C)  OF THIS CLAUSE,
PROVIDED THAT IF SUCH AMOUNT OF TAX IS LESS THAN ZERO IT SHALL BE DEEMED
TO BE ZERO; AND
  (E) PROVIDED THAT IN NO EVENT SHALL THE AMOUNT OF TAX COMPUTED  PURSU-
ANT  TO  SUBCLAUSE  (D)  OF THIS CLAUSE ON THE TAXPAYER'S TOTAL BUSINESS
CAPITAL, OR THE PORTION THEREOF ALLOCATED WITHIN THE  CITY,  EXCEED  TEN
MILLION DOLLARS, OR
  (III) INTENTIONALLY OMITTED.

S. 4610--A                         31                         A. 6721--A

  (IV) IF NEW YORK CITY RECEIPTS ARE:                  FIXED DOLLAR MINIMUM
                                                       TAX IS:
NOT MORE THAN $100,000                                 $25
MORE THAN $100,000 BUT NOT OVER $250,000               $75
MORE THAN $250,000 BUT NOT OVER $500,000               $175
MORE THAN $500,000 BUT NOT OVER $1,000,000             $500
MORE THAN $1,000,000 BUT NOT OVER $5,000,000           $1,500
MORE THAN $5,000,000 BUT NOT OVER $25,000,000          $3,500
MORE THAN $25,000,000 BUT NOT OVER $50,000,000         $5,000
MORE THAN $50,000,000 BUT NOT OVER $100,000,000        $10,000
MORE THAN $100,000,000 BUT NOT OVER $250,000,000       $20,000
MORE THAN $250,000,000 BUT NOT OVER $500,000,000       $50,000
MORE THAN $500,000,000 BUT NOT OVER $1,000,000,000     $100,000
OVER $1,000,000,000                                    $200,000
  FOR  PURPOSES  OF THIS CLAUSE, NEW YORK CITY RECEIPTS ARE THE RECEIPTS
COMPUTED IN ACCORDANCE WITH SECTION 11-654.2 OF THIS SUBCHAPTER FOR  THE
TAXABLE YEAR. IF THE TAXABLE YEAR IS LESS THAN TWELVE MONTHS, THE AMOUNT
PRESCRIBED BY THIS CLAUSE SHALL BE REDUCED BY TWENTY-FIVE PERCENT IF THE
PERIOD  FOR WHICH THE TAXPAYER IS SUBJECT TO TAX IS MORE THAN SIX MONTHS
BUT NOT MORE THAN NINE MONTHS AND BY FIFTY PERCENT  IF  THE  PERIOD  FOR
WHICH THE TAXPAYER IS SUBJECT TO TAX IS NOT MORE THAN SIX MONTHS. IF THE
TAXABLE  YEAR  IS  LESS  THAN TWELVE MONTHS, THE AMOUNT OF NEW YORK CITY
RECEIPTS FOR PURPOSES OF THIS  CLAUSE  IS  DETERMINED  BY  DIVIDING  THE
AMOUNT  OF  THE RECEIPTS FOR THE TAXABLE YEAR BY THE NUMBER OF MONTHS IN
THE TAXABLE YEAR AND MULTIPLYING THE RESULT BY TWELVE.
  (F) INTENTIONALLY OMITTED.
  (G) INTENTIONALLY OMITTED.
  (H) INTENTIONALLY OMITTED.
  (I) INTENTIONALLY OMITTED.
  (J) (1) IF THE AMOUNT OF BUSINESS INCOME ALLOCATED WITHIN THE CITY  AS
HEREINAFTER  PROVIDED  IS  LESS  THAN  ONE  MILLION  DOLLARS, THE AMOUNT
COMPUTED IN CLAUSE (I) OF SUBPARAGRAPH ONE  OF  PARAGRAPH  (E)  OF  THIS
SUBDIVISION  SHALL  BE  AT THE RATE OF SIX AND FIVE-TENTHS PER CENTUM OF
THE AMOUNT OF BUSINESS INCOME ALLOCATED WITHIN THE CITY  AS  HEREINAFTER
PROVIDED, SUBJECT TO ANY MODIFICATION REQUIRED BY PARAGRAPHS (D) AND (E)
OF SUBDIVISION THREE OF THIS SECTION;
  (2)  SUBJECT TO SUBPARAGRAPH THREE OF THIS PARAGRAPH, IF THE AMOUNT OF
BUSINESS INCOME ALLOCATED WITHIN THE CITY AS HEREINAFTER PROVIDED IS ONE
MILLION DOLLARS OR GREATER BUT LESS THAN ONE MILLION FIVE HUNDRED  THOU-
SAND  DOLLARS,  THE AMOUNT COMPUTED IN CLAUSE (I) OF SUBPARAGRAPH ONE OF
PARAGRAPH (E) OF THIS SUBDIVISION SHALL BE AT THE RATE OF  (I)  SIX  AND
FIVE-TENTHS PER CENTUM, PLUS (II) TWO AND THIRTY-FIVE ONE-HUNDREDTHS PER
CENTUM  MULTIPLIED  BY  A  FRACTION  THE NUMERATOR OF WHICH IS ALLOCATED
BUSINESS INCOME LESS ONE MILLION DOLLARS AND THE DENOMINATOR OF WHICH IS
FIVE HUNDRED THOUSAND DOLLARS, OF THE AMOUNT OF  BUSINESS  INCOME  ALLO-
CATED  WITHIN THE CITY AS HEREINAFTER PROVIDED, SUBJECT TO ANY MODIFICA-
TION REQUIRED BY PARAGRAPHS (D) AND (E) OF  SUBDIVISION  THREE  OF  THIS
SECTION;
  (3)  PROVIDED,  HOWEVER,  NOTWITHSTANDING ANYTHING TO THE CONTRARY, IF
THE AMOUNT OF BUSINESS INCOME BEFORE ALLOCATION IS TWO  MILLION  DOLLARS
OR GREATER BUT LESS THAN THREE MILLION DOLLARS, THE RATE OF TAX PROVIDED
FOR IN THIS PARAGRAPH SHALL NOT BE LESS THAN (I) SIX AND FIVE-TENTHS PER
CENTUM,  PLUS  (II) TWO AND THIRTY-FIVE ONE-HUNDREDTHS PER CENTUM MULTI-
PLIED BY A FRACTION THE NUMERATOR OF WHICH  IS  BUSINESS  INCOME  BEFORE
ALLOCATION  LESS TWO MILLION DOLLARS AND THE DENOMINATOR OF WHICH IS ONE
MILLION DOLLARS, AND PROVIDED, HOWEVER, NOTWITHSTANDING ANYTHING TO  THE

S. 4610--A                         32                         A. 6721--A

CONTRARY,  IF  THE  AMOUNT OF BUSINESS INCOME BEFORE ALLOCATION IS THREE
MILLION DOLLARS  OR  GREATER,  THE  RATE  OF  TAX  SHALL  BE  EIGHT  AND
EIGHTY-FIVE  ONE-HUNDREDTHS  PERCENTUM  OR,  IN  THE CASE OF A FINANCIAL
CORPORATION,  AS  DEFINED IN CLAUSE (I) OF SUBPARAGRAPH ONE OF PARAGRAPH
(E) OF SUBDIVISION ONE OF SECTION 11-654,  IF  THE  AMOUNT  OF  BUSINESS
INCOME BEFORE ALLOCATION IS THREE MILLION DOLLARS OR GREATER THE RATE OF
TAX SHALL BE NINE PER CENTUM.
  (K)(1) FOR QUALIFIED NEW YORK MANUFACTURING CORPORATIONS AS DEFINED IN
SUBPARAGRAPH  FOUR  OF  THIS PARAGRAPH, IF THE AMOUNT OF BUSINESS INCOME
ALLOCATED WITHIN THE CITY AS  HEREINAFTER  PROVIDED  IS  LESS  THAN  TEN
MILLION  DOLLARS,  THE AMOUNT COMPUTED IN CLAUSE (I) OF SUBPARAGRAPH ONE
OF PARAGRAPH (E) OF THIS SUBDIVISION SHALL BE AT THE RATE  OF  FOUR  AND
FOUR  HUNDRED  TWENTY-FIVE  ONE  THOUSANDTHS PER CENTUM, OF ITS BUSINESS
INCOME ALLOCATED WITHIN THE CITY AS HEREINAFTER PROVIDED, SUBJECT TO ANY
MODIFICATION REQUIRED BY PARAGRAPHS (D) AND (E) OF SUBDIVISION THREE  OF
THIS SECTION;
  (2)  SUBJECT TO SUBPARAGRAPH THREE OF THIS PARAGRAPH FOR QUALIFIED NEW
YORK MANUFACTURING CORPORATIONS AS DEFINED IN SUBPARAGRAPH FOUR OF  THIS
PARAGRAPH, IF THE AMOUNT OF BUSINESS INCOME ALLOCATED WITHIN THE CITY AS
HEREINAFTER  PROVIDED  IS  TEN  MILLION DOLLARS OR GREATER BUT LESS THAN
TWENTY MILLION DOLLARS, THE AMOUNT COMPUTED IN CLAUSE  (I)  OF  SUBPARA-
GRAPH  ONE  OF PARAGRAPH (E) OF THIS SUBDIVISION SHALL BE AT THE RATE OF
(I) FOUR AND FOUR HUNDRED TWENTY-FIVE ONE-THOUSANDTHS PER  CENTUM,  PLUS
(II) FOUR AND FOUR HUNDRED TWENTY-FIVE ONE-THOUSANDTHS PER CENTUM MULTI-
PLIED  BY A FRACTION THE NUMERATOR OF WHICH IS ALLOCATED BUSINESS INCOME
LESS TEN MILLION DOLLARS AND THE DENOMINATOR OF  WHICH  IS  TEN  MILLION
DOLLARS,  OF  ITS BUSINESS INCOME OR THE PORTION OF SUCH BUSINESS INCOME
ALLOCATED WITHIN THE  CITY  AS  HEREINAFTER  PROVIDED,  SUBJECT  TO  ANY
MODIFICATION  REQUIRED BY PARAGRAPHS (D) AND (E) OF SUBDIVISION THREE OF
THIS SECTION;
  (3) NOTWITHSTANDING ANYTHING TO THE CONTRARY, IF THE AMOUNT  OF  BUSI-
NESS  INCOME  BEFORE ALLOCATION IS TWENTY MILLION DOLLARS OR GREATER BUT
LESS THAN FORTY MILLION DOLLARS, THE RATE OF TAX PROVIDED  FOR  IN  THIS
PARAGRAPH  SHALL  NOT BE LESS THAN (I) FOUR AND FOUR HUNDRED TWENTY-FIVE
ONE THOUSANDTHS PERCENTUM, PLUS (II) FOUR AND FOUR  HUNDRED  TWENTY-FIVE
ONE  THOUSANDTHS  PERCENTUM  MULTIPLIED  BY  A FRACTION THE NUMERATOR OF
WHICH IS BUSINESS INCOME BEFORE ALLOCATION LESS TWENTY  MILLION  DOLLARS
AND  THE  DENOMINATOR  OF WHICH IS TWENTY MILLION DOLLARS, AND PROVIDED,
HOWEVER, NOTWITHSTANDING ANYTHING TO THE  CONTRARY,  IF  THE  AMOUNT  OF
BUSINESS  INCOME  BEFORE ALLOCATION IS FORTY MILLION DOLLARS OR GREATER,
THE RATE OF TAX  SHALL  BE  EIGHT  AND  EIGHTY-FIVE  ONE-HUNDREDTHS  PER
CENTUM.
  (4)(I)  AS  USED  IN THIS SUBPARAGRAPH, THE TERM "MANUFACTURING CORPO-
RATION" MEANS A CORPORATION PRINCIPALLY ENGAGED IN THE MANUFACTURING AND
SALE THEREOF OF TANGIBLE PERSONAL PROPERTY; AND THE TERM "MANUFACTURING"
INCLUDES THE PROCESS (INCLUDING THE ASSEMBLY PROCESS) (A) OF WORKING RAW
MATERIALS INTO WARES SUITABLE FOR USE OR (B) WHICH GIVES NEW SHAPES, NEW
QUALITIES OR NEW COMBINATIONS TO MATTER WHICH ALREADY HAS  GONE  THROUGH
SOME  ARTIFICIAL PROCESS, BY THE USE OF MACHINERY, TOOLS, APPLIANCES AND
OTHER SIMILAR EQUIPMENT. MOREOVER, IN THE CASE OF A COMBINED  REPORT,  A
COMBINED  GROUP  SHALL  BE  CONSIDERED A "MANUFACTURING CORPORATION" 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, IN THE CASE  OF  A
COMBINED  REPORT,  A  COMBINED  GROUP, SHALL BE "PRINCIPALLY ENGAGED" IN
ACTIVITIES DESCRIBED ABOVE IF, DURING THE TAXABLE YEAR, MORE THAN  FIFTY

S. 4610--A                         33                         A. 6721--A

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.
  (II) A "QUALIFIED NEW YORK MANUFACTURING CORPORATION" IS A MANUFACTUR-
ING  CORPORATION  THAT  HAS  PROPERTY IN THE STATE WHICH IS DESCRIBED IN
SUBPARAGRAPH FIVE OF THIS PARAGRAPH AND EITHER (A) THE ADJUSTED BASIS OF
SUCH PROPERTY FOR FEDERAL INCOME TAX PURPOSES AT THE CLOSE OF THE  TAXA-
BLE  YEAR IS AT LEAST ONE MILLION DOLLARS OR (B) MORE THAN FIFTY PERCEN-
TUM OF ITS REAL AND PERSONAL PROPERTY IS LOCATED IN THE STATE.
  (5) FOR PURPOSES OF SUBCLAUSE (A) OF CLAUSE (II) OF SUBPARAGRAPH  FOUR
OF  THIS  PARAGRAPH,  PROPERTY  INCLUDES  TANGIBLE PERSONAL PROPERTY AND
OTHER TANGIBLE PROPERTY, INCLUDING BUILDINGS 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 SUBSECTION (D) OF
SECTION ONE HUNDRED SEVENTY-NINE OF THE INTERNAL REVENUE  CODE,  HAVE  A
SITUS  IN  THE  STATE  AND  ARE  PRINCIPALLY USED BY THE TAXPAYER IN THE
PRODUCTION OF GOODS BY MANUFACTURING. PROPERTY USED IN THE PRODUCTION OF
GOODS SHALL INCLUDE MACHINERY,  EQUIPMENT  OR  OTHER  TANGIBLE  PROPERTY
WHICH  IS PRINCIPALLY USED IN THE REPAIR AND SERVICE OF OTHER MACHINERY,
EQUIPMENT OR OTHER TANGIBLE PROPERTY USED PRINCIPALLY IN THE  PRODUCTION
OF  GOODS AND SHALL INCLUDE ALL FACILITIES USED IN THE PRODUCTION OPERA-
TION, INCLUDING STORAGE OF MATERIAL TO BE USED IN PRODUCTION AND OF  THE
PRODUCTS THAT ARE PRODUCED.
  2.  THE  AMOUNT  OF  INVESTMENT  CAPITAL AND BUSINESS CAPITAL SHALL BE
DETERMINED BY TAKING THE AVERAGE VALUE  OF  THE  GROSS  ASSETS  INCLUDED
THEREIN   (LESS   LIABILITIES   DEDUCTIBLE  THEREFROM  PURSUANT  TO  THE
PROVISIONS OF SUBDIVISIONS FOUR  AND  SIX  OF  SECTION  11-652  OF  THIS
SUBCHAPTER),  AND,  IF  THE PERIOD COVERED BY THE REPORT IS OTHER THAN A
PERIOD OF TWELVE CALENDAR MONTHS,  BY  MULTIPLYING  SUCH  VALUE  BY  THE
NUMBER  OF CALENDAR MONTHS OR MAJOR PARTS THEREOF INCLUDED IN SUCH PERI-
OD, AND DIVIDING THE PRODUCT THUS OBTAINED BY TWELVE.  FOR  PURPOSES  OF
THIS  SUBDIVISION,  REAL  PROPERTY  AND  MARKETABLE  SECURITIES SHALL BE
VALUED AT FAIR MARKET VALUE AND THE VALUE  OF  PERSONAL  PROPERTY  OTHER
THAN MARKETABLE SECURITIES SHALL BE THE VALUE THEREOF SHOWN ON THE BOOKS
AND  RECORDS  OF  THE  TAXPAYER  IN  ACCORDANCE  WITH GENERALLY ACCEPTED
ACCOUNTING PRINCIPLES.
  3. THE PORTION OF THE BUSINESS INCOME OF A TAXPAYER TO BE ALLOCATED TO
THE CITY SHALL BE DETERMINED AS FOLLOWS:
  (A) MULTIPLY ITS BUSINESS INCOME BY A BUSINESS  ALLOCATION  PERCENTAGE
TO BE DETERMINED BY:
  (1) ASCERTAINING THE PERCENTAGE WHICH THE AVERAGE VALUE OF THE TAXPAY-
ER'S REAL AND TANGIBLE PERSONAL PROPERTY, WHETHER OWNED OR RENTED TO IT,
WITHIN  THE  CITY  DURING  THE PERIOD COVERED BY ITS REPORT BEARS TO THE
AVERAGE VALUE OF ALL THE TAXPAYER'S REAL AND TANGIBLE PERSONAL PROPERTY,
WHETHER OWNED OR RENTED TO IT, WHEREVER SITUATED DURING SUCH PERIOD. FOR
THE PURPOSE OF THIS SUBPARAGRAPH, THE TERM "VALUE OF THE TAXPAYER'S REAL
AND TANGIBLE PERSONAL PROPERTY" SHALL MEAN THE ADJUSTED  BASES  OF  SUCH
PROPERTIES  FOR  FEDERAL INCOME TAX PURPOSES (EXCEPT THAT IN THE CASE OF
RENTED PROPERTY SUCH VALUE SHALL MEAN THE PRODUCT OF (I) EIGHT AND  (II)
THE GROSS RENTS PAYABLE FOR THE RENTAL OF SUCH PROPERTY DURING THE TAXA-
BLE  YEAR);  PROVIDED,  HOWEVER,  THAT THE TAXPAYER MAY MAKE A ONE-TIME,
REVOCABLE ELECTION, PURSUANT TO REGULATIONS PROMULGATED BY  THE  COMMIS-
SIONER  OF  FINANCE  TO USE FAIR MARKET VALUE AS THE VALUE OF ALL OF ITS
REAL AND TANGIBLE PERSONAL PROPERTY, PROVIDED THAT SUCH ELECTION IS MADE

S. 4610--A                         34                         A. 6721--A

ON OR BEFORE THE DUE DATE FOR FILING A REPORT UNDER  SECTION  11-655  OF
THIS  SUBCHAPTER  FOR THE TAXPAYER'S FIRST TAXABLE YEAR COMMENCING ON OR
AFTER JANUARY  FIRST,  TWO  THOUSAND  FIFTEEN  AND  PROVIDED  THAT  SUCH
ELECTION  SHALL  NOT APPLY TO ANY TAXABLE YEAR WITH RESPECT TO WHICH THE
TAXPAYER IS INCLUDED ON A COMBINED REPORT UNLESS EACH OF  THE  TAXPAYERS
INCLUDED  ON  SUCH  REPORT  HAS  MADE  SUCH AN ELECTION WHICH REMAINS IN
EFFECT FOR SUCH YEAR OR TO ANY TAXPAYER THAT WAS SUBJECT  TO  TAX  UNDER
SUBCHAPTER  TWO  OF  THIS CHAPTER AND DID NOT HAVE AN ELECTION IN EFFECT
UNDER SUBPARAGRAPH ONE OF PARAGRAPH (A) OF SUBDIVISION THREE OF  SECTION
11-604 OF THIS CHAPTER ON DECEMBER THIRTY-FIRST, TWO THOUSAND FOURTEEN;
  (2)  ASCERTAINING  THE PERCENTAGE DETERMINED UNDER SECTION 11-654.2 OF
THIS SUBCHAPTER;
  (3) ASCERTAINING THE PERCENTAGE OF THE TOTAL WAGES, SALARIES AND OTHER
PERSONAL SERVICE COMPENSATION, SIMILARLY COMPUTED, DURING SUCH PERIOD OF
EMPLOYEES WITHIN THE CITY, EXCEPT GENERAL  EXECUTIVE  OFFICERS,  TO  THE
TOTAL WAGES, SALARIES AND OTHER PERSONAL SERVICE COMPENSATION, SIMILARLY
COMPUTED,  DURING SUCH PERIOD OF ALL THE TAXPAYER'S EMPLOYEES WITHIN AND
WITHOUT THE CITY, EXCEPT GENERAL EXECUTIVE OFFICERS; AND
  (4) ADDING TOGETHER THE PERCENTAGES SO  DETERMINED  AND  DIVIDING  THE
RESULT BY THE NUMBER OF PERCENTAGES.
  (5) INTENTIONALLY OMITTED.
  (6) INTENTIONALLY OMITTED.
  (7) INTENTIONALLY OMITTED.
  (8) INTENTIONALLY OMITTED.
  (9) INTENTIONALLY OMITTED.
  (10) NOTWITHSTANDING SUBPARAGRAPHS ONE THROUGH FOUR OF THIS PARAGRAPH,
THE BUSINESS ALLOCATION PERCENTAGE, TO THE EXTENT THAT IT IS COMPUTED BY
REFERENCE TO THE PERCENTAGES DETERMINED UNDER SUBPARAGRAPHS ONE, TWO AND
THREE  OF  THIS  PARAGRAPH, SHALL BE COMPUTED IN THE MANNER SET FORTH IN
THIS SUBPARAGRAPH.
  (I) INTENTIONALLY OMITTED.
  (II) INTENTIONALLY OMITTED.
  (III) INTENTIONALLY OMITTED.
  (IV) INTENTIONALLY OMITTED.
  (V) INTENTIONALLY OMITTED.
  (VI) INTENTIONALLY OMITTED.
  (VII) FOR TAXABLE YEARS BEGINNING IN TWO THOUSAND FIFTEEN,  THE  BUSI-
NESS  ALLOCATION  PERCENTAGE  SHALL BE DETERMINED BY ADDING TOGETHER THE
FOLLOWING PERCENTAGES:
  (A) THE PRODUCT OF TEN PERCENT AND  THE  PERCENTAGE  DETERMINED  UNDER
SUBPARAGRAPH ONE OF THIS PARAGRAPH;
  (B)  THE PRODUCT OF EIGHTY PERCENT AND THE PERCENTAGE DETERMINED UNDER
SUBPARAGRAPH TWO OF THIS PARAGRAPH; AND
  (C) THE PRODUCT OF TEN PERCENT AND  THE  PERCENTAGE  DETERMINED  UNDER
SUBPARAGRAPH THREE OF THIS PARAGRAPH.
  (VIII)  FOR TAXABLE YEARS BEGINNING IN TWO THOUSAND SIXTEEN, THE BUSI-
NESS ALLOCATION PERCENTAGE SHALL BE DETERMINED BY  ADDING  TOGETHER  THE
FOLLOWING PERCENTAGES:
  (A)  THE PRODUCT OF SIX AND ONE-HALF PERCENT AND THE PERCENTAGE DETER-
MINED UNDER SUBPARAGRAPH ONE OF THIS PARAGRAPH;
  (B) THE PRODUCT OF EIGHTY-SEVEN PERCENT AND THE PERCENTAGE  DETERMINED
UNDER SUBPARAGRAPH TWO OF THIS PARAGRAPH; AND
  (C)  THE PRODUCT OF SIX AND ONE-HALF PERCENT AND THE PERCENTAGE DETER-
MINED UNDER SUBPARAGRAPH THREE OF THIS PARAGRAPH.

S. 4610--A                         35                         A. 6721--A

  (IX) FOR TAXABLE YEARS BEGINNING IN TWO THOUSAND SEVENTEEN, THE  BUSI-
NESS  ALLOCATION  PERCENTAGE  SHALL BE DETERMINED BY ADDING TOGETHER THE
FOLLOWING PERCENTAGES:
  (A)  THE  PRODUCT  OF  THREE  AND  ONE-HALF PERCENT AND THE PERCENTAGE
DETERMINED UNDER SUBPARAGRAPH ONE OF THIS PARAGRAPH;
  (B) THE PRODUCT OF NINETY-THREE PERCENT AND THE PERCENTAGE  DETERMINED
UNDER SUBPARAGRAPH TWO OF THIS PARAGRAPH; AND
  (C)  THE  PRODUCT  OF  THREE  AND  ONE-HALF PERCENT AND THE PERCENTAGE
DETERMINED UNDER SUBPARAGRAPH THREE OF THIS PARAGRAPH.
  (X) FOR TAXABLE YEARS BEGINNING  AFTER  TWO  THOUSAND  SEVENTEEN,  THE
BUSINESS  ALLOCATION PERCENTAGE SHALL BE THE PERCENTAGE DETERMINED UNDER
SUBPARAGRAPH TWO OF THIS PARAGRAPH.
  (XI) THE COMMISSIONER OF FINANCE SHALL PROMULGATE RULES  NECESSARY  TO
IMPLEMENT  THE  PROVISIONS OF THIS SUBPARAGRAPH UNDER SUCH CIRCUMSTANCES
WHERE ANY OF THE PERCENTAGES TO BE DETERMINED  UNDER  SUBPARAGRAPH  ONE,
TWO OR THREE OF THIS PARAGRAPH CANNOT BE DETERMINED BECAUSE THE TAXPAYER
HAS NO PROPERTY, RECEIPTS OR WAGES WITHIN OR WITHOUT THE CITY.
  (XII)  NOTWITHSTANDING THE PROVISIONS OF CLAUSES (VIII), (IX), AND (X)
OF THIS SUBPARAGRAPH, FOR TAXABLE YEARS BEGINNING ON  OR  AFTER  JANUARY
FIRST,  TWO THOUSAND EIGHTEEN, A TAXPAYER THAT HAS FIFTY MILLION DOLLARS
OR LESS OF RECEIPTS ALLOCATED TO THE CITY AS  DETERMINED  UNDER  SECTION
11-654.2  OF  THIS  SUBCHAPTER,  OR,  IF  THE  TAXPAYER IS INCLUDED IN A
COMBINED GROUP, A COMBINED GROUP THAT HAS FIFTY MILLION DOLLARS OR  LESS
OF  RECEIPTS  ALLOCATED TO THE CITY AS DETERMINED UNDER SECTION 11-654.2
OF THIS SUBCHAPTER, MAY MAKE A ONE-TIME ELECTION TO DETERMINE ITS  BUSI-
NESS ALLOCATION PERCENTAGE BY ADDING TOGETHER THE FOLLOWING PERCENTAGES:
  (A)  THE  PRODUCT  OF  THREE  AND  ONE-HALF PERCENT AND THE PERCENTAGE
DETERMINED UNDER SUBPARAGRAPH ONE OF THIS PARAGRAPH;
  (B) THE PRODUCT OF NINETY-THREE PERCENT AND THE PERCENTAGE  DETERMINED
UNDER SUBPARAGRAPH TWO OF THIS PARAGRAPH; AND
  (C)  THE  PRODUCT  OF  THREE  AND  ONE-HALF PERCENT AND THE PERCENTAGE
DETERMINED UNDER SUBPARAGRAPH THREE OF THIS PARAGRAPH.
  THE ELECTION PROVIDED FOR IN THIS CLAUSE MUST BE MADE ON  AN  ORIGINAL
OR  AMENDED  REPORT  FILED PURSUANT TO SECTION 11-655 OF THIS SUBCHAPTER
FOR THE TAXPAYER'S OR, IF THE TAXPAYER IS INCLUDED IN A COMBINED  GROUP,
THE  COMBINED GROUP'S, FIRST TAXABLE YEAR COMMENCING ON OR AFTER JANUARY
FIRST, TWO THOUSAND EIGHTEEN AND SHALL REMAIN IN EFFECT UNTIL REVOKED BY
THE TAXPAYER, OR IF THE TAXPAYER IS INCLUDED IN A  COMBINED  GROUP,  THE
COMBINED  GROUP.  AN  ELECTION  SHALL BE REVOKED UNDER THIS CLAUSE ON AN
ORIGINAL OR AMENDED REPORT FILED PURSUANT  TO  SECTION  11-655  OF  THIS
SUBCHAPTER  FOR  THE  TAXPAYER'S,  OR  IF  THE TAXPAYER IS INCLUDED IN A
COMBINED GROUP, THE COMBINED GROUP'S, FIRST TAXABLE YEAR WITH RESPECT TO
WHICH SUCH REVOCATION IS TO BE EFFECTIVE. IF THE TAXPAYER IS A MEMBER OF
A COMBINED GROUP, AN ELECTION OR REVOCATION BY THE TAXPAYER  UNDER  THIS
CLAUSE SHALL APPLY TO ALL MEMBERS OF THE COMBINED GROUP.
  (11) A FOREIGN AIR CARRIER DESCRIBED IN THE FIRST SENTENCE OF SUBPARA-
GRAPH  ONE  OF PARAGRAPH (C-1) OF SUBDIVISION EIGHT OF SECTION 11-652 OF
THIS SUBCHAPTER  SHALL  DETERMINE  ITS  BUSINESS  ALLOCATION  PERCENTAGE
PURSUANT  TO  SUBPARAGRAPHS ONE THROUGH FOUR OF THIS PARAGRAPH, AS MODI-
FIED BY SUBPARAGRAPH TEN OF THIS PARAGRAPH, EXCEPT THAT  THE  NUMERATORS
AND  DENOMINATORS INVOLVED IN SUCH COMPUTATION SHALL EXCLUDE PROPERTY TO
THE EXTENT EMPLOYED IN GENERATING INCOME EXCLUDED FROM ENTIRE NET INCOME
FOR THE TAXABLE YEAR PURSUANT TO PARAGRAPH (C-1) OF SUBDIVISION EIGHT OF
SECTION 11-652 OF THIS SUBCHAPTER, EXCLUDE SUCH RECEIPTS AS ARE EXCLUDED
FROM ENTIRE NET INCOME FOR THE TAXABLE YEAR PURSUANT TO PARAGRAPH  (C-1)
OF  SUBDIVISION  EIGHT OF SECTION 11-652 OF THIS SUBCHAPTER, AND EXCLUDE

S. 4610--A                         36                         A. 6721--A

WAGES, SALARIES OR OTHER PERSONAL SERVICE COMPENSATION WHICH ARE DIRECT-
LY ATTRIBUTABLE TO THE GENERATION OF INCOME  EXCLUDED  FROM  ENTIRE  NET
INCOME  FOR  THE TAXABLE YEAR PURSUANT TO PARAGRAPH (C-1) OF SUBDIVISION
EIGHT OF SECTION 11-652 OF THIS SUBCHAPTER.
  (B) INTENTIONALLY OMITTED.
  (C) INTENTIONALLY OMITTED.
  (D)  IN  ANY  TAXABLE YEAR WHEN PROPERTY IS SOLD OR OTHERWISE DISPOSED
OF, WITH RESPECT TO WHICH A  DEDUCTION  HAS  BEEN  ALLOWED  PURSUANT  TO
SUBPARAGRAPH ONE OR TWO OF PARAGRAPH (D) OF SUBDIVISION THREE OF SECTION
11-604  OF  THIS  CHAPTER  OR  SUBDIVISION (K) OF SECTION 11-641 OF THIS
CHAPTER IN ANY PERIOD IN WHICH THE TAXPAYER WAS  SUBJECT  TO  TAX  UNDER
SUBCHAPTER  TWO  OF THIS CHAPTER, THE GAIN OR LOSS THEREON ENTERING INTO
THE COMPUTATION OF  FEDERAL  TAXABLE  INCOME  SHALL  BE  DISREGARDED  IN
COMPUTING  ENTIRE  NET INCOME, AND THERE SHALL BE ADDED TO OR SUBTRACTED
FROM THE PORTION OF ENTIRE NET INCOME ALLOCATED WITHIN THE CITY THE GAIN
OR LOSS UPON SUCH SALE OR OTHER DISPOSITION. IN COMPUTING SUCH  GAIN  OR
LOSS  THE BASIS OF THE PROPERTY SOLD OR DISPOSED OF SHALL BE ADJUSTED TO
REFLECT THE DEDUCTION ALLOWED WITH RESPECT TO SUCH PROPERTY PURSUANT  TO
SUBPARAGRAPH ONE OR TWO OF PARAGRAPH (D) OF SUBDIVISION THREE OF SECTION
11-604  OF THIS CHAPTER. PROVIDED, HOWEVER, THAT NO LOSS SHALL BE RECOG-
NIZED FOR THE PURPOSES OF THIS SUBPARAGRAPH WITH RESPECT TO  A  SALE  OR
OTHER  DISPOSITION  OF PROPERTY TO A PERSON WHOSE ACQUISITION THEREOF IS
NOT A PURCHASE AS DEFINED IN  SUBSECTION  (D)  OF  SECTION  ONE  HUNDRED
SEVENTY-NINE OF THE INTERNAL REVENUE CODE.
  (E)  IN  ANY  TAXABLE YEAR WHEN PROPERTY IS SOLD OR OTHERWISE DISPOSED
OF, WITH RESPECT TO WHICH A  DEDUCTION  HAS  BEEN  ALLOWED  PURSUANT  TO
SUBPARAGRAPH ONE OR TWO OF PARAGRAPH (E) OF SUBDIVISION THREE OF SECTION
11-604  OF  THIS  CHAPTER  IN ANY PERIOD THE TAXPAYER WAS SUBJECT TO TAX
UNDER SUBCHAPTER TWO OF THIS CHAPTER, THE GAIN OR LOSS THEREON  ENTERING
INTO  THE  COMPUTATION OF FEDERAL TAXABLE INCOME SHALL BE DISREGARDED IN
COMPUTING ENTIRE NET INCOME, AND THERE SHALL BE ADDED TO  OR  SUBTRACTED
FROM THE PORTION OF ENTIRE NET INCOME ALLOCATED WITHIN THE CITY THE GAIN
OR  LOSS  UPON SUCH SALE OR OTHER DISPOSITION. IN COMPUTING SUCH GAIN OR
LOSS THE BASIS OF THE PROPERTY SOLD OR DISPOSED OF SHALL BE ADJUSTED  TO
REFLECT  THE DEDUCTION ALLOWED WITH RESPECT TO SUCH PROPERTY PURSUANT TO
SUBPARAGRAPH ONE OR TWO OF PARAGRAPH (E) OF SUBDIVISION THREE OF SECTION
11-604 OF THIS CHAPTER.  PROVIDED, HOWEVER, THAT NO LOSS SHALL BE RECOG-
NIZED FOR THE PURPOSES OF THIS SUBPARAGRAPH WITH RESPECT TO  A  SALE  OR
OTHER  DISPOSITION  OF PROPERTY TO A PERSON WHOSE ACQUISITION THEREOF IS
NOT A PURCHASE AS DEFINED IN  SUBSECTION  (D)  OF  SECTION  ONE  HUNDRED
SEVENTY-NINE OF THE INTERNAL REVENUE CODE.
  4.  THE  PORTION OF THE BUSINESS CAPITAL OF A TAXPAYER TO BE ALLOCATED
WITHIN THE CITY SHALL BE DETERMINED BY MULTIPLYING THE AMOUNT THEREOF BY
THE BUSINESS ALLOCATION PERCENTAGE DETERMINED AS HEREINABOVE PROVIDED.
  4-A. A CORPORATION THAT IS A PARTNER IN A  PARTNERSHIP  SHALL  COMPUTE
TAX  UNDER  THIS  SUBCHAPTER  USING  ANY METHOD REQUIRED OR PERMITTED IN
REGULATIONS OF THE COMMISSIONER OF FINANCE.
  5. INTENTIONALLY OMITTED.
  6. INTENTIONALLY OMITTED.
  7. INTENTIONALLY OMITTED.
  8. INTENTIONALLY OMITTED.
  9. IF IT SHALL APPEAR TO THE COMMISSIONER OF FINANCE THAT ANY BUSINESS
ALLOCATION PERCENTAGE DETERMINED AS HEREINABOVE PROVIDED DOES NOT  PROP-
ERLY  REFLECT  THE  ACTIVITY,  BUSINESS, INCOME OR CAPITAL OF A TAXPAYER
WITHIN THE CITY, THE COMMISSIONER OF FINANCE SHALL BE AUTHORIZED IN  HIS
OR  HER  DISCRETION  TO  ADJUST IT, OR THE TAXPAYER MAY REQUEST THAT THE

S. 4610--A                         37                         A. 6721--A

COMMISSIONER OF FINANCE ADJUST IT, BY (A) EXCLUDING ONE OR MORE  OF  THE
FACTORS  THEREIN,  (B)  INCLUDING  ONE  OR  MORE  OTHER FACTORS, SUCH AS
EXPENSES, PURCHASES, CONTRACT VALUES  (MINUS  SUBCONTRACT  VALUES),  (C)
EXCLUDING  ONE  OR  MORE ASSETS IN COMPUTING SUCH ALLOCATION PERCENTAGE,
PROVIDED THE INCOME THEREFROM, IS ALSO EXCLUDED  IN  DETERMINING  ENTIRE
NET  INCOME,  OR (D) ANY OTHER SIMILAR OR DIFFERENT METHOD CALCULATED TO
EFFECT A FAIR AND PROPER ALLOCATION OF THE INCOME AND CAPITAL REASONABLY
ATTRIBUTABLE TO THE CITY.  THE PARTY SEEKING THE ADJUSTMENT  SHALL  BEAR
THE BURDEN OF PROOF TO DEMONSTRATE THAT THE BUSINESS ALLOCATION PERCENT-
AGE  DETERMINED  PURSUANT  TO  THIS  SECTION DOES NOT RESULT IN A PROPER
REFLECTION OF THE TAXPAYER'S INCOME OR CAPITAL WITHIN THE CITY AND  THAT
THE  PROPOSED  ADJUSTMENT  IS APPROPRIATE.   THE COMMISSIONER OF FINANCE
FROM TIME TO TIME SHALL PUBLISH ALL RULINGS OF GENERAL  PUBLIC  INTEREST
WITH RESPECT TO ANY APPLICATION OF THE PROVISIONS OF THIS SUBDIVISION.
  10. INTENTIONALLY OMITTED.
  11. INTENTIONALLY OMITTED.
  12. INTENTIONALLY OMITTED.
  13.  (A)  IN  ADDITION  TO ANY OTHER CREDIT ALLOWED BY THIS SECTION, A
TAXPAYER SHALL BE ALLOWED A CREDIT  AGAINST  THE  TAX  IMPOSED  BY  THIS
SUBCHAPTER  TO  BE  CREDITED OR REFUNDED WITHOUT INTEREST, IN THE MANNER
HEREINAFTER PROVIDED IN THIS SECTION.
  (1)(I) WHERE A TAXPAYER SHALL  HAVE  RELOCATED  TO  THE  CITY  FROM  A
LOCATION  OUTSIDE THE STATE, AND BY SUCH RELOCATION SHALL HAVE CREATED A
MINIMUM OF ONE HUNDRED  INDUSTRIAL  OR  COMMERCIAL  EMPLOYMENT  OPPORTU-
NITIES;  AND WHERE SUCH TAXPAYER SHALL HAVE ENTERED INTO A WRITTEN LEASE
FOR THE RELOCATION PREMISES,  THE  TERMS  OF  WHICH  LEASE  PROVIDE  FOR
INCREASED ADDITIONAL PAYMENTS TO THE LANDLORD WHICH ARE BASED SOLELY AND
DIRECTLY  UPON  ANY INCREASE OR ADDITION IN REAL ESTATE TAXES IMPOSED ON
THE LEASED PREMISES, THE TAXPAYER UPON APPROVAL AND CERTIFICATION BY THE
INDUSTRIAL AND COMMERCIAL INCENTIVE BOARD AS HEREINAFTER PROVIDED  SHALL
BE  ENTITLED TO A CREDIT AGAINST THE TAX IMPOSED BY THIS SUBCHAPTER. THE
AMOUNT OF SUCH CREDIT SHALL BE AN AMOUNT EQUAL TO THE  ANNUAL  INCREASED
PAYMENTS  ACTUALLY MADE BY THE TAXPAYER TO THE LANDLORD WHICH ARE SOLELY
AND DIRECTLY ATTRIBUTABLE TO AN INCREASE OR ADDITION TO THE REAL  ESTATE
TAX  IMPOSED UPON THE LEASED PREMISES. SUCH CREDIT SHALL BE ALLOWED ONLY
TO THE EXTENT THAT THE TAXPAYER HAS NOT OTHERWISE CLAIMED SAID AMOUNT AS
A DEDUCTION AGAINST THE TAX IMPOSED BY THIS SUBCHAPTER.
  (II) THE INDUSTRIAL AND COMMERCIAL INCENTIVE BOARD  IN  APPROVING  AND
CERTIFYING  TO  THE  QUALIFICATIONS  OF  THE TAXPAYER TO RECEIVE THE TAX
CREDIT PROVIDED FOR HEREIN SHALL FIRST DETERMINE THAT THE APPLICANT  HAS
MET  THE REQUIREMENTS OF THIS SECTION, AND FURTHER, THAT THE GRANTING OF
THE TAX CREDIT TO THE APPLICANT IS IN THE "PUBLIC INTEREST".  IN  DETER-
MINING  THAT  THE  GRANTING OF THE TAX CREDIT IS IN THE PUBLIC INTEREST,
THE BOARD SHALL MAKE AFFIRMATIVE FINDINGS THAT: THE GRANTING OF THE  TAX
CREDIT  TO  THE  APPLICANT  WILL NOT EFFECT AN UNDUE HARDSHIP ON SIMILAR
TAXPAYERS ALREADY LOCATED WITHIN THE CITY; THE  EXISTENCE  OF  THIS  TAX
INCENTIVE  HAS BEEN INSTRUMENTAL IN BRINGING ABOUT THE RELOCATION OF THE
APPLICANT TO THE CITY; AND THE GRANTING OF THE TAX  CREDIT  WILL  FOSTER
THE ECONOMIC RECOVERY AND ECONOMIC DEVELOPMENT OF THE CITY.
  (III)  THE TAX CREDIT, IF APPROVED AND CERTIFIED BY THE INDUSTRIAL AND
COMMERCIAL INCENTIVE BOARD, MUST BE UTILIZED ANNUALLY  BY  THE  TAXPAYER
FOR  THE  LENGTH  OF THE TERM OF THE LEASE OR FOR A PERIOD NOT TO EXCEED
TEN YEARS FROM THE DATE OF RELOCATION WHICHEVER PERIOD IS SHORTER.
  (2) WHEN USED IN THIS SUBDIVISION:

S. 4610--A                         38                         A. 6721--A

  (I) "EMPLOYMENT OPPORTUNITY" MEANS THE CREATION OF A FULL  TIME  POSI-
TION  OF GAINFUL EMPLOYMENT FOR AN INDUSTRIAL OR COMMERCIAL EMPLOYEE AND
THE ACTUAL HIRING OF SUCH EMPLOYEE FOR THE SAID POSITION.
  (II)  "INDUSTRIAL  EMPLOYEE"  MEANS  ONE ENGAGED IN THE MANUFACTURE OR
ASSEMBLING OF TANGIBLE GOODS OR THE PROCESSING OF RAW MATERIALS.
  (III) "COMMERCIAL EMPLOYEE" MEANS ONE ENGAGED IN THE  BUYING,  SELLING
OR  OTHERWISE  PROVIDING  OF  GOODS  OR  SERVICES OTHER THAN ON A RETAIL
BASIS.
  (IV) "RETAIL" MEANS THE SELLING OR OTHERWISE DISPOSING  OR  FURNISHING
OF TANGIBLE GOODS OR SERVICES DIRECTLY TO THE ULTIMATE USER OR CONSUMER.
  (V)  "FULL TIME POSITION" MEANS THE HIRING OF AN INDUSTRIAL OR COMMER-
CIAL EMPLOYEE IN A POSITION OF GAINFUL EMPLOYMENT WHERE  THE  NUMBER  OF
HOURS  WORKED BY SUCH EMPLOYEES IS NOT LESS THAN THIRTY HOURS DURING ANY
GIVEN WORK WEEK.
  (VI) "INDUSTRIAL AND  COMMERCIAL  INCENTIVE  BOARD"  MEANS  THE  BOARD
CREATED  PURSUANT TO PART THREE OF SUBCHAPTER TWO OF CHAPTER TWO OF THIS
TITLE.
  (B) THE CREDIT ALLOWED UNDER THIS SUBDIVISION  FOR  ANY  TAXABLE  YEAR
SHALL  BE DEEMED TO BE AN OVERPAYMENT OF TAX BY THE TAXPAYER TO BE CRED-
ITED OR REFUNDED, WITHOUT INTEREST, IN ACCORDANCE WITH THE PROVISIONS OF
SECTION 11-677 OF THIS CHAPTER.
  14. (A) IN ADDITION TO ANY OTHER CREDIT ALLOWED  BY  THIS  SECTION,  A
TAXPAYER  SHALL  BE  ALLOWED  A  CREDIT  AGAINST THE TAX IMPOSED BY THIS
SUBCHAPTER TO BE CREDITED OR REFUNDED WITHOUT INTEREST,  IN  THE  MANNER
HEREINAFTER  PROVIDED  IN  THIS SECTION. THE AMOUNT OF SUCH CREDIT SHALL
BE:
  (1) A MAXIMUM OF THREE HUNDRED DOLLARS FOR EACH COMMERCIAL  EMPLOYMENT
OPPORTUNITY  AND  A  MAXIMUM OF FIVE HUNDRED DOLLARS FOR EACH INDUSTRIAL
EMPLOYMENT OPPORTUNITY RELOCATED TO THE CITY FROM AN  AREA  OUTSIDE  THE
STATE.  SUCH CREDIT SHALL BE ALLOWED TO A TAXPAYER WHO RELOCATES A MINI-
MUM OF TEN EMPLOYMENT OPPORTUNITIES. THE CREDIT SHALL BE ALLOWED AGAINST
EMPLOYMENT OPPORTUNITY RELOCATION COSTS INCURRED BY THE  TAXPAYER.  SUCH
CREDIT  SHALL  BE  ALLOWED  ONLY TO THE EXTENT THAT THE TAXPAYER HAS NOT
CLAIMED A DEDUCTION  FOR  ALLOWABLE  EMPLOYMENT  OPPORTUNITY  RELOCATION
COSTS.  THE  CREDIT  ALLOWED  HEREUNDER  MAY BE TAKEN BY THE TAXPAYER IN
WHOLE OR IN PART IN THE YEAR IN  WHICH  THE  EMPLOYMENT  OPPORTUNITY  IS
RELOCATED  BY  SUCH  TAXPAYER OR EITHER OF THE TWO YEARS SUCCEEDING SUCH
EVENT, PROVIDED, HOWEVER, NO CREDIT SHALL BE ALLOWED UNDER THIS SUBDIVI-
SION TO A TAXPAYER FOR INDUSTRIAL EMPLOYMENT OPPORTUNITIES RELOCATED  TO
PREMISES  (I)  THAT  ARE  WITHIN AN INDUSTRIAL BUSINESS ZONE ESTABLISHED
PURSUANT TO SECTION 22-626 OF THIS CODE AND (II)  FOR  WHICH  A  BINDING
CONTRACT  TO PURCHASE OR LEASE WAS FIRST ENTERED INTO BY THE TAXPAYER ON
OR AFTER JULY FIRST, TWO THOUSAND FIVE.
  THE COMMISSIONER OF FINANCE IS EMPOWERED TO PROMULGATE RULES AND REGU-
LATIONS AND TO PRESCRIBE THE FORM OF APPLICATION TO BE USED BY A TAXPAY-
ER SEEKING THE CREDIT PROVIDED HEREUNDER.
  (2) WHEN USED IN THIS SUBDIVISION:
  (I) "EMPLOYMENT OPPORTUNITY" MEANS THE CREATION OF A FULL  TIME  POSI-
TION  OF GAINFUL EMPLOYMENT FOR AN INDUSTRIAL OR COMMERCIAL EMPLOYEE AND
THE ACTUAL HIRING OF SUCH EMPLOYEE FOR THE SAID POSITION.
  (II) "INDUSTRIAL EMPLOYEE" MEANS ONE ENGAGED  IN  THE  MANUFACTURE  OR
ASSEMBLING OF TANGIBLE GOODS OR THE PROCESSING OF RAW MATERIALS.
  (III)  "COMMERCIAL  EMPLOYEE" MEANS ONE ENGAGED IN THE BUYING, SELLING
OR OTHERWISE PROVIDING OF GOODS OR  SERVICES  OTHER  THAN  ON  A  RETAIL
BASIS.

S. 4610--A                         39                         A. 6721--A

  (IV)  "RETAIL"  MEANS  THE  SELLING OR OTHERWISE DISPOSING OF TANGIBLE
GOODS DIRECTLY TO THE ULTIMATE USER OR CONSUMER.
  (V)  "FULL TIME POSITION" MEANS THE HIRING OF AN INDUSTRIAL OR COMMER-
CIAL EMPLOYEE IN A POSITION OF GAINFUL EMPLOYMENT WHERE  THE  NUMBER  OF
HOURS  WORKED  BY SUCH EMPLOYEE IS NOT LESS THAN THIRTY HOURS DURING ANY
GIVEN WORK WEEK.
  (VI)  "EMPLOYMENT  OPPORTUNITY  RELOCATION  COSTS"  MEANS  THE   COSTS
INCURRED  BY  THE TAXPAYER IN MOVING FURNITURE, FILES, PAPERS AND OFFICE
EQUIPMENT INTO THE CITY FROM A LOCATION OUTSIDE  THE  STATE;  THE  COSTS
INCURRED BY THE TAXPAYER IN THE MOVING AND INSTALLATION OF MACHINERY AND
EQUIPMENT  INTO THE CITY FROM A LOCATION OUTSIDE THE STATE; THE COSTS OF
INSTALLATION OF TELEPHONES AND OTHER COMMUNICATIONS  EQUIPMENT  REQUIRED
AS  A  RESULT  OF THE RELOCATION TO THE CITY FROM A LOCATION OUTSIDE THE
STATE; THE COST  INCURRED  IN  THE  PURCHASE  OF  OFFICE  FURNITURE  AND
FIXTURES  REQUIRED  AS  A  RESULT  OF  THE RELOCATION TO THE CITY FROM A
LOCATION OUTSIDE THE STATE; AND THE COST OF RENOVATION OF  THE  PREMISES
TO  BE  OCCUPIED  AS A RESULT OF THE RELOCATION; PROVIDED, HOWEVER, THAT
SUCH RENOVATION COSTS SHALL BE ALLOWABLE ONLY TO THE EXTENT THAT THEY DO
NOT EXCEED SEVENTY-FIVE CENTS PER SQUARE FOOT OF THE TOTAL AREA UTILIZED
BY THE TAXPAYER IN THE OCCUPIED PREMISES.
  (B) THE CREDIT ALLOWED UNDER THIS SECTION FOR ANY TAXABLE  YEAR  SHALL
BE  DEEMED TO BE AN OVERPAYMENT OF TAX BY THE TAXPAYER TO BE CREDITED OR
REFUNDED WITHOUT INTEREST IN ACCORDANCE WITH THE PROVISIONS  OF  SECTION
11-677 OF THIS CHAPTER.
  (C)  NOTWITHSTANDING  ANY  OTHER  PROVISION OF THIS SUBDIVISION TO THE
CONTRARY, IN THE CASE OF A TAXPAYER THAT HAS RECEIVED, IN A TAXABLE YEAR
BEGINNING BEFORE JANUARY FIRST, TWO THOUSAND  FIFTEEN,  THE  CREDIT  SET
FORTH  IN  SUBDIVISION FOURTEEN OF SECTION 11-604 OF THIS CHAPTER FOR AN
ELIGIBLE EMPLOYMENT RELOCATION, A CREDIT SHALL BE ALLOWED TO THE TAXPAY-
ER UNDER THIS SUBDIVISION FOR ANY TAX YEAR BEGINNING ON OR AFTER JANUARY
FIRST, TWO THOUSAND FIFTEEN, IN THE SAME AMOUNT AND TO THE  SAME  EXTENT
THAT  A  CREDIT,  OR THE UNUSED PORTION THEREOF, WOULD HAVE BEEN ALLOWED
UNDER SUBDIVISION FOURTEEN OF SECTION 11-604  OF  THIS  CHAPTER,  AS  IN
EFFECT ON DECEMBER THIRTY-FIRST, TWO THOUSAND FOURTEEN, IF SUCH SUBDIVI-
SION CONTINUED TO APPLY TO THE TAXPAYER FOR SUCH TAXABLE YEAR.
  15. INTENTIONALLY OMITTED.
  16. INTENTIONALLY OMITTED.
  17.  (A)  IN  ADDITION  TO ANY OTHER CREDIT ALLOWED BY THIS SECTION, A
TAXPAYER THAT HAS OBTAINED THE CERTIFICATIONS REQUIRED BY CHAPTER  SIX-B
OF  TITLE  TWENTY-TWO OF THIS CODE SHALL BE ALLOWED A CREDIT AGAINST THE
TAX IMPOSED BY THIS SUBCHAPTER. THE AMOUNT OF THE CREDIT  SHALL  BE  THE
AMOUNT DETERMINED BY MULTIPLYING FIVE HUNDRED DOLLARS OR, IN THE CASE OF
A  TAXPAYER  THAT  HAS  OBTAINED PURSUANT TO CHAPTER SIX-B OF SUCH TITLE
TWENTY-TWO A CERTIFICATION OF ELIGIBILITY DATED ON OR AFTER JULY  FIRST,
NINETEEN HUNDRED NINETY-FIVE, ONE THOUSAND DOLLARS OR, IN THE CASE OF AN
ELIGIBLE  BUSINESS  THAT  HAS OBTAINED PURSUANT TO CHAPTER SIX-B OF SUCH
TITLE TWENTY-TWO A CERTIFICATION OF ELIGIBILITY DATED ON OR  AFTER  JULY
FIRST, TWO THOUSAND, FOR A RELOCATION TO ELIGIBLE PREMISES LOCATED WITH-
IN A REVITALIZATION AREA DEFINED IN SUBDIVISION (N) OF SECTION 22-621 OF
THIS  CODE,  THREE THOUSAND DOLLARS, BY THE NUMBER OF ELIGIBLE AGGREGATE
EMPLOYMENT SHARES MAINTAINED BY THE TAXPAYER  DURING  THE  TAXABLE  YEAR
WITH RESPECT TO PARTICULAR PREMISES TO WHICH THE TAXPAYER HAS RELOCATED;
PROVIDED, HOWEVER, WITH RESPECT TO A RELOCATION FOR WHICH NO APPLICATION
FOR  A  CERTIFICATE OF ELIGIBILITY IS SUBMITTED PRIOR TO JULY FIRST, TWO
THOUSAND THREE, TO ELIGIBLE PREMISES THAT ARE NOT WITHIN  A  REVITALIZA-
TION  AREA,  IF  THE  DATE  OF SUCH RELOCATION AS DETERMINED PURSUANT TO

S. 4610--A                         40                         A. 6721--A

SUBDIVISION (J) OF SECTION 22-621 OF THIS CODE  IS  BEFORE  JULY  FIRST,
NINETEEN  HUNDRED NINETY-FIVE, THE AMOUNT TO BE MULTIPLIED BY THE NUMBER
OF ELIGIBLE AGGREGATE EMPLOYMENT SHARES SHALL BE FIVE  HUNDRED  DOLLARS,
AND  WITH RESPECT TO A RELOCATION FOR WHICH NO APPLICATION FOR A CERTIF-
ICATE OF ELIGIBILITY IS SUBMITTED PRIOR  TO  JULY  FIRST,  TWO  THOUSAND
THREE,  TO  ELIGIBLE  PREMISES THAT ARE WITHIN A REVITALIZATION AREA, IF
THE DATE OF SUCH RELOCATION AS DETERMINED PURSUANT TO SUBDIVISION (J) OF
SUCH SECTION IS BEFORE JULY FIRST,  NINETEEN  HUNDRED  NINETY-FIVE,  THE
AMOUNT  TO  BE MULTIPLIED BY THE NUMBER OF ELIGIBLE AGGREGATE EMPLOYMENT
SHARES SHALL BE FIVE HUNDRED DOLLARS, AND IF THE DATE OF SUCH RELOCATION
AS DETERMINED PURSUANT TO SUBDIVISION (J) OF SUCH SECTION IS ON OR AFTER
JULY FIRST, NINETEEN HUNDRED NINETY-FIVE, AND  BEFORE  JULY  FIRST,  TWO
THOUSAND,  ONE THOUSAND DOLLARS; PROVIDED, HOWEVER, THAT NO CREDIT SHALL
BE ALLOWED FOR THE RELOCATION OF ANY RETAIL ACTIVITY OR HOTEL  SERVICES;
PROVIDED,  FURTHER,  THAT NO CREDIT SHALL BE ALLOWED UNDER THIS SUBDIVI-
SION TO ANY TAXPAYER THAT HAS ELECTED PURSUANT  TO  SUBDIVISION  (D)  OF
SECTION 22-622 OF THIS CODE TO TAKE SUCH CREDIT AGAINST A GROSS RECEIPTS
TAX  IMPOSED  BY  CHAPTER ELEVEN OF THIS TITLE; AND PROVIDED THAT IN THE
CASE OF AN ELIGIBLE BUSINESS THAT HAS OBTAINED PURSUANT TO CHAPTER SIX-B
OF SUCH TITLE TWENTY-TWO CERTIFICATIONS OF ELIGIBILITY FOR MORE THAN ONE
RELOCATION, THE PORTION  OF  THE  TOTAL  AMOUNT  OF  ELIGIBLE  AGGREGATE
EMPLOYMENT  SHARES  TO  BE  MULTIPLIED BY THE DOLLAR AMOUNT SPECIFIED IN
THIS SUBDIVISION FOR EACH SUCH CERTIFICATION OF A  RELOCATION  SHALL  BE
THE  NUMBER  OF  TOTAL  ATTRIBUTED  ELIGIBLE AGGREGATE EMPLOYMENT SHARES
DETERMINED WITH RESPECT TO SUCH RELOCATION PURSUANT TO  SUBDIVISION  (O)
OF  SECTION  22-621  OF THIS CODE. FOR PURPOSES OF THIS SUBDIVISION, THE
TERMS "ELIGIBLE AGGREGATE EMPLOYMENT SHARES," "RELOCATE," "RETAIL ACTIV-
ITY" AND "HOTEL SERVICES" SHALL HAVE THE MEANINGS  ASCRIBED  BY  SECTION
22-621 OF THIS CODE.
  (B) THE CREDIT ALLOWED UNDER THIS SUBDIVISION WITH RESPECT TO ELIGIBLE
AGGREGATE  EMPLOYMENT SHARES MAINTAINED WITH RESPECT TO PARTICULAR PREM-
ISES TO WHICH THE TAXPAYER HAS RELOCATED SHALL BE ALLOWED FOR THE  FIRST
TAXABLE  YEAR DURING WHICH SUCH ELIGIBLE AGGREGATE EMPLOYMENT SHARES ARE
MAINTAINED WITH RESPECT TO SUCH PREMISES  AND  FOR  ANY  OF  THE  TWELVE
SUCCEEDING  TAXABLE  YEARS  DURING  WHICH  ELIGIBLE AGGREGATE EMPLOYMENT
SHARES ARE MAINTAINED WITH RESPECT TO SUCH PREMISES; PROVIDED  THAT  THE
CREDIT  ALLOWED  FOR THE TWELFTH SUCCEEDING TAXABLE YEAR SHALL BE CALCU-
LATED BY MULTIPLYING THE NUMBER OF ELIGIBLE AGGREGATE EMPLOYMENT  SHARES
MAINTAINED WITH RESPECT TO SUCH PREMISES IN THE TWELFTH SUCCEEDING TAXA-
BLE  YEAR  BY THE LESSER OF ONE AND A FRACTION THE NUMERATOR OF WHICH IS
SUCH NUMBER OF DAYS IN THE TAXABLE YEAR OF RELOCATION LESS THE NUMBER OF
DAYS THE ELIGIBLE BUSINESS MAINTAINED EMPLOYMENT SHARES IN THE  ELIGIBLE
PREMISES  IN THE TAXABLE YEAR OF RELOCATION AND THE DENOMINATOR OF WHICH
IS THE NUMBER OF DAYS IN SUCH TWELFTH  SUCCEEDING  TAXABLE  YEAR  DURING
WHICH  SUCH  ELIGIBLE  AGGREGATE  EMPLOYMENT  SHARES ARE MAINTAINED WITH
RESPECT TO SUCH PREMISES. EXCEPT AS PROVIDED IN PARAGRAPH  (D)  OF  THIS
SUBDIVISION,  IF  THE AMOUNT OF THE CREDIT ALLOWABLE UNDER THIS SUBDIVI-
SION FOR ANY TAXABLE YEAR EXCEEDS THE TAX IMPOSED  FOR  SUCH  YEAR,  THE
EXCESS MAY BE CARRIED OVER, IN ORDER, TO THE FIVE IMMEDIATELY SUCCEEDING
TAXABLE  YEARS  AND,  TO  THE  EXTENT  NOT PREVIOUSLY DEDUCTIBLE, MAY BE
DEDUCTED FROM THE TAXPAYER'S TAX FOR SUCH YEARS.
  (C) THE CREDIT ALLOWABLE UNDER  THIS  SUBDIVISION  SHALL  BE  DEDUCTED
AFTER  THE  CREDIT  ALLOWED BY SUBDIVISION EIGHTEEN OF THIS SECTION, BUT
PRIOR TO THE DEDUCTION OF ANY OTHER CREDIT ALLOWED BY THIS SECTION.
  (D) IN THE CASE OF A TAXPAYER THAT HAS  OBTAINED  A  CERTIFICATION  OF
ELIGIBILITY  PURSUANT  TO CHAPTER SIX-B OF TITLE TWENTY-TWO OF THIS CODE

S. 4610--A                         41                         A. 6721--A

DATED ON OR AFTER JULY FIRST, TWO THOUSAND FOR A RELOCATION TO  ELIGIBLE
PREMISES  LOCATED  WITHIN THE REVITALIZATION AREA DEFINED IN SUBDIVISION
(N) OF SECTION 22-621 OF THIS  CODE,  THE  CREDITS  ALLOWED  UNDER  THIS
SUBDIVISION,  OR  IN THE CASE OF A TAXPAYER THAT HAS RELOCATED MORE THAN
ONCE, THE PORTION OF SUCH CREDITS ATTRIBUTED TO  SUCH  CERTIFICATION  OF
ELIGIBILITY  PURSUANT  TO PARAGRAPH (A) OF THIS SUBDIVISION, AGAINST THE
TAX IMPOSED BY THIS CHAPTER FOR THE TAXABLE YEAR OF SUCH RELOCATION  AND
FOR  THE  FOUR  TAXABLE YEARS IMMEDIATELY SUCCEEDING THE TAXABLE YEAR OF
SUCH RELOCATION, SHALL BE DEEMED  TO  BE  OVERPAYMENTS  OF  TAX  BY  THE
TAXPAYER  TO  BE  CREDITED  OR REFUNDED, WITHOUT INTEREST, IN ACCORDANCE
WITH THE PROVISIONS OF SECTION 11-677 OF THIS CHAPTER. FOR SUCH  TAXABLE
YEARS,  SUCH  CREDITS OR PORTIONS THEREOF MAY NOT BE CARRIED OVER TO ANY
SUCCEEDING TAXABLE YEAR; PROVIDED, HOWEVER, THAT  THIS  PARAGRAPH  SHALL
NOT APPLY TO ANY RELOCATION FOR WHICH AN APPLICATION FOR A CERTIFICATION
OF  ELIGIBILITY  WAS  NOT  SUBMITTED  PRIOR  TO JULY FIRST, TWO THOUSAND
THREE, UNLESS THE DATE OF SUCH RELOCATION IS ON OR AFTER JULY FIRST, TWO
THOUSAND.
  (E) NOTWITHSTANDING ANY OTHER PROVISION OF  THIS  SUBDIVISION  TO  THE
CONTRARY, IN THE CASE OF A TAXPAYER THAT HAS OBTAINED, PURSUANT TO CHAP-
TER SIX-B OF TITLE TWENTY-TWO OF THIS CODE, A CERTIFICATION OF ELIGIBIL-
ITY  AND HAS RECEIVED, IN A TAXABLE YEAR BEGINNING BEFORE JANUARY FIRST,
TWO THOUSAND FIFTEEN, THE CREDIT SET FORTH IN SUBDIVISION  SEVENTEEN  OF
SECTION  11-604  OF THIS CHAPTER OR SECTION 11-643.7 OF THIS CHAPTER FOR
THE RELOCATION OF AN ELIGIBLE BUSINESS, A CREDIT SHALL BE ALLOWED  UNDER
THIS  SUBDIVISION  TO  THE TAXPAYER FOR ANY TAXABLE YEAR BEGINNING ON OR
AFTER JANUARY FIRST, TWO THOUSAND FIFTEEN IN THE SAME AMOUNT AND TO  THE
SAME  EXTENT  THAT  A  CREDIT  WOULD HAVE BEEN ALLOWED UNDER SUBDIVISION
SEVENTEEN OF SECTION 11-604 OF THIS CHAPTER OR SECTION 11-643.7 OF  THIS
CHAPTER,  AS  IN EFFECT ON DECEMBER THIRTY-FIRST, TWO THOUSAND FOURTEEN,
IF SUCH SUBDIVISION CONTINUED TO APPLY TO THE TAXPAYER FOR SUCH  TAXABLE
YEAR.
  17-A. INTENTIONALLY OMITTED.
  17-B.  (A) IN ADDITION TO ANY OTHER CREDIT ALLOWED BY THIS SECTION, AN
ELIGIBLE BUSINESS THAT FIRST ENTERS INTO A BINDING CONTRACT ON OR  AFTER
JULY  FIRST, TWO THOUSAND FIVE TO PURCHASE OR LEASE ELIGIBLE PREMISES TO
WHICH IT RELOCATES SHALL BE ALLOWED A ONE-TIME CREDIT  AGAINST  THE  TAX
IMPOSED  BY  THIS  SUBCHAPTER  TO  BE CREDITED OR REFUNDED IN THE MANNER
HEREINAFTER PROVIDED IN THIS SUBDIVISION.  THE  AMOUNT  OF  SUCH  CREDIT
SHALL BE ONE THOUSAND DOLLARS PER FULL-TIME EMPLOYEE; PROVIDED, HOWEVER,
THAT  THE  AMOUNT  OF  SUCH CREDIT SHALL NOT EXCEED THE LESSER OF ACTUAL
RELOCATION COSTS OR ONE HUNDRED THOUSAND DOLLARS.
  (B) WHEN USED IN THIS SUBDIVISION, THE FOLLOWING TERMS SHALL HAVE  THE
FOLLOWING MEANINGS:
  (1)  "ELIGIBLE  BUSINESS" MEANS ANY BUSINESS SUBJECT TO TAX UNDER THIS
SUBCHAPTER THAT (I) HAS BEEN CONDUCTING SUBSTANTIAL BUSINESS  OPERATIONS
AND ENGAGING PRIMARILY IN INDUSTRIAL AND MANUFACTURING ACTIVITIES AT ONE
OR  MORE  LOCATIONS  WITHIN THE CITY OF NEW YORK OR OUTSIDE THE STATE OF
NEW YORK CONTINUOUSLY DURING THE  TWENTY-FOUR  CONSECUTIVE  FULL  MONTHS
IMMEDIATELY  PRECEDING  RELOCATION,  (II)  HAS  LEASED THE PREMISES FROM
WHICH IT RELOCATES CONTINUOUSLY DURING THE TWENTY-FOUR CONSECUTIVE  FULL
MONTHS IMMEDIATELY PRECEDING RELOCATION, (III) FIRST ENTERS INTO A BIND-
ING  CONTRACT  ON  OR AFTER JULY FIRST, TWO THOUSAND FIVE TO PURCHASE OR
LEASE ELIGIBLE PREMISES TO WHICH SUCH BUSINESS WILL RELOCATE,  AND  (IV)
WILL  BE ENGAGED PRIMARILY IN INDUSTRIAL AND MANUFACTURING ACTIVITIES AT
SUCH ELIGIBLE PREMISES.

S. 4610--A                         42                         A. 6721--A

  (2) "ELIGIBLE PREMISES" MEANS  PREMISES  LOCATED  ENTIRELY  WITHIN  AN
INDUSTRIAL BUSINESS ZONE. FOR ANY ELIGIBLE BUSINESS, AN INDUSTRIAL BUSI-
NESS  ZONE TAX CREDIT SHALL NOT BE GRANTED WITH RESPECT TO MORE THAN ONE
ELIGIBLE PREMISES.
  (3) "FULL-TIME EMPLOYEE" MEANS (I) ONE PERSON GAINFULLY EMPLOYED IN AN
ELIGIBLE  PREMISES  BY  AN  ELIGIBLE  BUSINESS WHERE THE NUMBER OF HOURS
REQUIRED TO BE WORKED BY SUCH PERSON IS NOT LESS THAN THIRTY-FIVE  HOURS
PER WEEK; OR (II) TWO PERSONS GAINFULLY EMPLOYED IN AN ELIGIBLE PREMISES
BY  AN ELIGIBLE BUSINESS WHERE THE NUMBER OF HOURS REQUIRED TO BE WORKED
BY EACH SUCH PERSON IS MORE THAN FIFTEEN HOURS PER WEEK  BUT  LESS  THAN
THIRTY-FIVE HOURS PER WEEK.
  (4)  "INDUSTRIAL  BUSINESS  ZONE" MEANS AN AREA WITHIN THE CITY OF NEW
YORK ESTABLISHED PURSUANT TO SECTION 22-626 OF THIS CODE.
  (5) "INDUSTRIAL BUSINESS ZONE TAX CREDIT" MEANS A CREDIT, AS  PROVIDED
FOR IN THIS SUBDIVISION, AGAINST A TAX IMPOSED UNDER THIS SUBCHAPTER.
  (6) "INDUSTRIAL AND MANUFACTURING ACTIVITIES" MEANS ACTIVITIES INVOLV-
ING THE ASSEMBLY OF GOODS TO CREATE A DIFFERENT ARTICLE, OR THE PROCESS-
ING,  FABRICATION,  OR PACKAGING OF GOODS.  INDUSTRIAL AND MANUFACTURING
ACTIVITIES SHALL NOT INCLUDE WASTE MANAGEMENT OR UTILITY SERVICES.
  (7) "RELOCATION" MEANS THE PHYSICAL RELOCATION OF FURNITURE, FIXTURES,
EQUIPMENT, MACHINERY AND SUPPLIES DIRECTLY TO AN ELIGIBLE PREMISES, FROM
ONE OR MORE LOCATIONS OF AN ELIGIBLE BUSINESS, INCLUDING  AT  LEAST  ONE
LOCATION AT WHICH SUCH BUSINESS CONDUCTS SUBSTANTIAL BUSINESS OPERATIONS
AND  ENGAGES  PRIMARILY  IN INDUSTRIAL AND MANUFACTURING ACTIVITIES. FOR
PURPOSES OF THIS SUBDIVISION, THE DATE OF RELOCATION SHALL  BE  (I)  THE
DATE  OF  THE  COMPLETION  OF THE RELOCATION TO THE ELIGIBLE PREMISES OR
(II) NINETY DAYS FROM THE COMMENCEMENT OF THE RELOCATION TO THE ELIGIBLE
PREMISES, WHICHEVER IS EARLIER.
  (8) "RELOCATION COSTS" MEANS COSTS INCURRED IN THE RELOCATION OF  SUCH
FURNITURE,  FIXTURES,  EQUIPMENT, MACHINERY AND SUPPLIES, INCLUDING, BUT
NOT LIMITED TO, THE COST OF DISMANTLING AND REASSEMBLING  EQUIPMENT  AND
THE COST OF FLOOR PREPARATION NECESSARY FOR THE REASSEMBLY OF THE EQUIP-
MENT.  RELOCATION  COSTS SHALL INCLUDE ONLY SUCH COSTS THAT ARE INCURRED
DURING THE NINETY-DAY PERIOD IMMEDIATELY FOLLOWING THE  COMMENCEMENT  OF
THE  RELOCATION  TO  AN  ELIGIBLE  PREMISES.  RELOCATION COSTS SHALL NOT
INCLUDE COSTS FOR STRUCTURAL OR CAPITAL IMPROVEMENTS OR ITEMS  PURCHASED
IN CONNECTION WITH THE RELOCATION.
  (C)  THE  CREDIT  ALLOWED  UNDER THIS SUBDIVISION FOR ANY TAXABLE YEAR
SHALL BE DEEMED TO BE AN OVERPAYMENT OF TAX BY THE TAXPAYER TO BE  CRED-
ITED  OR REFUNDED WITHOUT INTEREST, IN ACCORDANCE WITH THE PROVISIONS OF
SECTION 11-677 OF THIS CHAPTER.
  (D) THE NUMBER OF FULL-TIME EMPLOYEES FOR THE PURPOSES OF  CALCULATING
AN  INDUSTRIAL  BUSINESS  TAX  CREDIT  SHALL  BE  THE  AVERAGE NUMBER OF
FULL-TIME EMPLOYEES, CALCULATED ON  A  WEEKLY  BASIS,  EMPLOYED  IN  THE
ELIGIBLE  PREMISES BY THE ELIGIBLE BUSINESS IN THE FIFTY-TWO WEEK PERIOD
IMMEDIATELY FOLLOWING THE EARLIER OF (1) THE DATE OF THE  COMPLETION  OF
THE  RELOCATION  TO  ELIGIBLE  PREMISES  OR  (2)  NINETY  DAYS  FROM THE
COMMENCEMENT OF THE RELOCATION TO THE ELIGIBLE PREMISES.
  (E) THE CREDIT ALLOWED UNDER THIS SUBDIVISION MUST  BE  TAKEN  BY  THE
TAXPAYER  IN THE TAXABLE YEAR IN WHICH SUCH TWELVE MONTH PERIOD SELECTED
BY THE TAXPAYER ENDS.
  (F) FOR THE PURPOSES OF CALCULATING ENTIRE NET INCOME IN  THE  TAXABLE
YEAR  THAT AN INDUSTRIAL BUSINESS TAX CREDIT IS ALLOWED, A TAXPAYER MUST
ADD BACK THE AMOUNT OF THE CREDIT ALLOWED UNDER THIS SUBDIVISION, TO THE
EXTENT OF ANY RELOCATION COSTS DEDUCTED IN THE CURRENT TAXABLE YEAR OR A
PRIOR TAXABLE YEAR IN CALCULATING FEDERAL TAXABLE INCOME.

S. 4610--A                         43                         A. 6721--A

  (G) THE CREDIT ALLOWED UNDER THIS SUBDIVISION SHALL NOT BE GRANTED FOR
AN ELIGIBLE BUSINESS FOR MORE THAN ONE RELOCATION.  NOTWITHSTANDING  THE
FOREGOING, AN INDUSTRIAL BUSINESS TAX CREDIT SHALL NOT BE GRANTED IF THE
ELIGIBLE  BUSINESS  RECEIVES BENEFITS PURSUANT TO CHAPTER SIX-B OR SIX-C
OF  TITLE  TWENTY-TWO OF THIS CODE, THROUGH A GRANT PROGRAM ADMINISTERED
BY THE BUSINESS RELOCATION ASSISTANCE CORPORATION, OR  THROUGH  THE  NEW
YORK CITY PRINTERS RELOCATION FUND GRANT.
  (H)  THE COMMISSIONER OF FINANCE IS AUTHORIZED TO PROMULGATE RULES AND
REGULATIONS AND TO PRESCRIBE FORMS NECESSARY TO EFFECTUATE THE  PURPOSES
OF THIS SUBDIVISION.
  18.  (A)  IF  A CORPORATION IS A PARTNER IN AN UNINCORPORATED BUSINESS
TAXABLE UNDER CHAPTER FIVE OF THIS TITLE, AND IS REQUIRED TO INCLUDE  IN
ENTIRE  NET  INCOME  ITS  DISTRIBUTIVE  SHARE  OF INCOME, GAIN, LOSS AND
DEDUCTIONS OF, OR GUARANTEED PAYMENTS FROM,  SUCH  UNINCORPORATED  BUSI-
NESS, SUCH CORPORATION SHALL BE ALLOWED A CREDIT AGAINST THE TAX IMPOSED
BY  THIS  SUBCHAPTER  EQUAL  TO  THE LESSER OF THE AMOUNTS DETERMINED IN
SUBPARAGRAPHS ONE AND TWO OF THIS PARAGRAPH:
  (1) THE AMOUNT DETERMINED IN THIS SUBPARAGRAPH IS THE PRODUCT  OF  (I)
THE  SUM  OF  (A)  THE  TAX IMPOSED BY CHAPTER FIVE OF THIS TITLE ON THE
UNINCORPORATED BUSINESS FOR ITS TAXABLE YEAR ENDING WITHIN OR  WITH  THE
TAXABLE  YEAR OF THE CORPORATION AND PAID BY THE UNINCORPORATED BUSINESS
AND (B) THE AMOUNT OF ANY CREDIT OR CREDITS TAKEN BY THE  UNINCORPORATED
BUSINESS  UNDER  SECTION 11-503 OF THIS TITLE (EXCEPT THE CREDIT ALLOWED
BY SUBDIVISION (B) OF SECTION 11-503 OF THIS TITLE) FOR ITS TAXABLE YEAR
ENDING WITHIN OR WITH THE TAXABLE YEAR OF THE CORPORATION, TO THE EXTENT
THAT SUCH CREDITS DO NOT REDUCE SUCH UNINCORPORATED BUSINESS'S TAX BELOW
ZERO, AND (II) A FRACTION, THE NUMERATOR OF WHICH IS THE  NET  TOTAL  OF
THE   CORPORATION'S   DISTRIBUTIVE  SHARE  OF  INCOME,  GAIN,  LOSS  AND
DEDUCTIONS OF, AND GUARANTEED PAYMENTS FROM, THE UNINCORPORATED BUSINESS
FOR SUCH TAXABLE YEAR, AND THE DENOMINATOR OF WHICH IS THE SUM, FOR SUCH
TAXABLE YEAR, OF THE NET TOTAL DISTRIBUTIVE SHARES OF INCOME, GAIN, LOSS
AND DEDUCTIONS OF, AND GUARANTEED PAYMENTS TO, ALL PARTNERS IN THE UNIN-
CORPORATED BUSINESS FOR WHOM OR WHICH  SUCH  NET  TOTAL  (AS  SEPARATELY
DETERMINED FOR EACH PARTNER) IS GREATER THAN ZERO.
  (2)  THE  AMOUNT DETERMINED IN THIS SUBPARAGRAPH IS THE PRODUCT OF (I)
THE EXCESS OF (A) THE TAX COMPUTED UNDER CLAUSE (I) OF SUBPARAGRAPH  ONE
OF  PARAGRAPH  (E) OF SUBDIVISION ONE OF THIS SECTION, WITHOUT ALLOWANCE
OF ANY CREDITS ALLOWED BY THIS SECTION, OVER (B) THE  TAX  SO  COMPUTED,
DETERMINED AS IF THE CORPORATION HAD NO SUCH DISTRIBUTIVE SHARE OR GUAR-
ANTEED  PAYMENTS WITH RESPECT TO THE UNINCORPORATED BUSINESS, AND (II) A
FRACTION, THE NUMERATOR OF WHICH IS FOUR AND THE DENOMINATOR OF WHICH IS
EIGHT AND EIGHTY-FIVE ONE HUNDREDTHS, PROVIDED HOWEVER, IN THE CASE OF A
TAXPAYER THAT IS SUBJECT TO PARAGRAPH (J) OR (K) OF SUBDIVISION  ONE  OF
THIS SECTION, SUCH DENOMINATOR SHALL BE THE RATE OF TAX AS DETERMINED BY
SUCH  PARAGRAPH  (J) OR (K) FOR THE TAXABLE YEAR AND, PROVIDED, HOWEVER,
THAT THE AMOUNTS COMPUTED IN SUBCLAUSES (A) AND (B)  OF  CLAUSE  (I)  OF
THIS SUBPARAGRAPH SHALL BE COMPUTED WITH THE FOLLOWING MODIFICATIONS:
  (A)  SUCH  AMOUNTS  SHALL  BE COMPUTED WITHOUT TAKING INTO ACCOUNT ANY
CARRYFORWARD OR CARRYBACK BY THE PARTNER OF A NET OPERATING  LOSS  OR  A
PRIOR NET OPERATION LOSS CONVERSION SUBTRACTION;
  (B) IF, PRIOR TO TAKING INTO ACCOUNT ANY DISTRIBUTIVE SHARE OR GUARAN-
TEED PAYMENTS FROM ANY UNINCORPORATED BUSINESS OR ANY NET OPERATING LOSS
CARRYFORWARD  OR CARRYBACK, THE ENTIRE NET INCOME OF THE PARTNER IS LESS
THAN ZERO, SUCH ENTIRE NET INCOME SHALL BE TREATED AS ZERO; AND
  (C) IF SUCH PARTNER'S NET TOTAL DISTRIBUTIVE SHARE  OF  INCOME,  GAIN,
LOSS AND DEDUCTIONS OF, AND GUARANTEED PAYMENTS FROM, ANY UNINCORPORATED

S. 4610--A                         44                         A. 6721--A

BUSINESS IS LESS THAN ZERO, SUCH NET TOTAL SHALL BE TREATED AS ZERO. THE
AMOUNT DETERMINED IN THIS SUBPARAGRAPH SHALL NOT BE LESS THAN ZERO.
  (B)(1)  NOTWITHSTANDING  ANYTHING  TO THE CONTRARY IN PARAGRAPH (A) OF
THIS SUBDIVISION, IN THE CASE OF A CORPORATION THAT, BEFORE THE APPLICA-
TION OF THIS SUBDIVISION OR ANY OTHER CREDIT ALLOWED BY THIS SECTION, IS
LIABLE FOR THE TAX ON BUSINESS INCOME UNDER CLAUSE (I)  OF  SUBPARAGRAPH
ONE  OF  PARAGRAPH (E) OF SUBDIVISION ONE OF THIS SECTION, THE CREDIT OR
THE SUM OF THE CREDITS THAT MAY BE TAKEN BY SUCH CORPORATION FOR A TAXA-
BLE YEAR UNDER THIS SUBDIVISION WITH RESPECT TO AN UNINCORPORATED  BUSI-
NESS  OR  UNINCORPORATED  BUSINESSES  IN WHICH IT IS A PARTNER SHALL NOT
EXCEED THE TAX SO COMPUTED, WITHOUT ALLOWANCE OF ANY CREDITS ALLOWED  BY
THIS  SECTION,  MULTIPLIED  BY A FRACTION THE NUMERATOR OF WHICH IS FOUR
AND THE DENOMINATOR OF WHICH IS  EIGHT  AND  EIGHTY-FIVE  ONE-HUNDREDTHS
PROVIDED,  HOWEVER,  IN  THE CASE OF A TAXPAYER THAT IS SUBJECT TO PARA-
GRAPH (J) OR (K) OF SUBDIVISION ONE OF THIS  SECTION,  SUCH  DENOMINATOR
SHALL  BE THE RATE OF TAX AS DETERMINED BY SUCH PARAGRAPH (J) OR (K) FOR
THE TAXABLE YEAR. IF THE CREDIT ALLOWED UNDER THIS  SUBDIVISION  OR  THE
SUM  OF  SUCH CREDITS EXCEEDS THE PRODUCT OF SUCH TAX AND SUCH FRACTION,
THE AMOUNT OF THE EXCESS MAY BE CARRIED FORWARD, IN ORDER,  TO  EACH  OF
THE  SEVEN  IMMEDIATELY  SUCCEEDING TAXABLE YEARS AND, TO THE EXTENT NOT
PREVIOUSLY TAKEN, SHALL BE ALLOWED AS A CREDIT IN EACH OF SUCH YEARS. IN
APPLYING THE PROVISIONS OF THE PRECEDING SENTENCE, THE CREDIT DETERMINED
FOR THE TAXABLE YEAR UNDER PARAGRAPH (A) OF THIS  SUBDIVISION  SHALL  BE
TAKEN  BEFORE  TAKING ANY CREDIT CARRYFORWARD PURSUANT TO THIS PARAGRAPH
AND THE CREDIT CARRYFORWARD ATTRIBUTABLE TO THE  EARLIEST  TAXABLE  YEAR
SHALL  BE  TAKEN  BEFORE  TAKING A CREDIT CARRYFORWARD ATTRIBUTABLE TO A
SUBSEQUENT TAXABLE YEAR.
  (2) INTENTIONALLY OMITTED.
  (2-A) NOTWITHSTANDING ANY OTHER PROVISION OF THIS SUBDIVISION  TO  THE
CONTRARY, IN THE CASE OF A TAXPAYER THAT HAS RECEIVED, IN A TAXABLE YEAR
BEGINNING  BEFORE  JANUARY  FIRST,  TWO THOUSAND FIFTEEN, THE CREDIT SET
FORTH IN SUBDIVISION EIGHTEEN OF SECTION 11-604 OF THIS  CHAPTER  OR  IN
SECTION  11-643.8  OF  THIS CHAPTER FOR A TAX PAID UNDER CHAPTER FIVE OF
THIS TITLE IN A TAXABLE YEAR BEGINNING BEFORE JANUARY FIRST,  TWO  THOU-
SAND  FIFTEEN, THE TAXPAYER MAY CARRY FORWARD THE UNUSED PORTION OF SUCH
CREDIT UNDER THIS SUBDIVISION TO ANY TAXABLE YEAR BEGINNING ON OR  AFTER
JANUARY  FIRST,  TWO THOUSAND FIFTEEN IN THE SAME AMOUNT AND TO THE SAME
EXTENT, INCLUDING THE SAME LIMITATIONS, THAT THE CREDIT, OR  THE  UNUSED
PORTION  THEREOF,  WOULD  HAVE  BEEN ALLOWED TO BE CARRIED FORWARD UNDER
SUBPARAGRAPH ONE OF PARAGRAPH (B) OF  SUBDIVISION  EIGHTEEN  OF  SECTION
11-604  OF  THIS  CHAPTER OR PARAGRAPH ONE OF SUBDIVISION (B) OF SECTION
11-643.8 OF THIS CHAPTER, AS IN EFFECT  ON  DECEMBER  THIRTY-FIRST,  TWO
THOUSAND FOURTEEN, IF SUCH SUBDIVISION CONTINUED TO APPLY TO THE TAXPAY-
ER FOR SUCH TAXABLE YEAR.
  (3) NO CREDIT ALLOWED UNDER THIS SUBDIVISION MAY BE TAKEN IN A TAXABLE
YEAR  BY A TAXPAYER THAT, IN THE ABSENCE OF SUCH CREDIT, WOULD BE LIABLE
FOR THE TAX COMPUTED ON THE BASIS OF BUSINESS CAPITAL UNDER CLAUSE  (II)
OF  SUBPARAGRAPH ONE OF PARAGRAPH (E) OF SUBDIVISION ONE OF THIS SECTION
OR THE FIXED-DOLLAR MINIMUM TAX UNDER CLAUSE (IV) OF SUBPARAGRAPH ONE OF
PARAGRAPH (E) OF SUBDIVISION ONE OF THIS SECTION.
  (C) FOR CORPORATIONS THAT FILE A REPORT ON A COMBINED  BASIS  PURSUANT
TO  SECTION  11-654.3  OF  THIS  SUBCHAPTER,  THE CREDIT ALLOWED BY THIS
SUBDIVISION SHALL BE COMPUTED AS IF THE COMBINED GROUP WERE THE  PARTNER
IN  EACH  UNINCORPORATED  BUSINESS FROM WHICH ANY OF THE MEMBERS OF SUCH
GROUP HAD A DISTRIBUTIVE SHARE OR GUARANTEED PAYMENTS, PROVIDED,  HOWEV-
ER,  IF  MORE  THAN ONE MEMBER OF THE COMBINED GROUP IS A PARTNER IN THE

S. 4610--A                         45                         A. 6721--A

SAME UNINCORPORATED BUSINESS, FOR PURPOSES OF THE  CALCULATION  REQUIRED
IN  SUBPARAGRAPH ONE OF PARAGRAPH (A) OF THIS SUBDIVISION, THE NUMERATOR
OF THE FRACTION DESCRIBED IN CLAUSE (II) OF SUCH SUBPARAGRAPH ONE  SHALL
BE  THE  SUM  OF THE NET TOTAL DISTRIBUTIVE SHARES OF INCOME, GAIN, LOSS
AND DEDUCTIONS OF, AND  GUARANTEED  PAYMENTS  FROM,  THE  UNINCORPORATED
BUSINESS  OF  ALL  OF THE PARTNERS OF THE UNINCORPORATED BUSINESS WITHIN
THE COMBINED GROUP FOR WHICH SUCH NET TOTAL  (AS  SEPARATELY  DETERMINED
FOR  EACH  PARTNER)  IS  GREATER  THAN ZERO, AND THE DENOMINATOR OF SUCH
FRACTION SHALL BE THE SUM  OF  THE  NET  TOTAL  DISTRIBUTIVE  SHARES  OF
INCOME,  GAIN, LOSS AND DEDUCTIONS OF, AND GUARANTEED PAYMENTS FROM, THE
UNINCORPORATED BUSINESS OF ALL PARTNERS IN THE  UNINCORPORATED  BUSINESS
FOR  WHOM  OR  WHICH  SUCH  NET TOTAL (AS SEPARATELY DETERMINED FOR EACH
PARTNER) IS GREATER THAN ZERO.
  (D) NOTWITHSTANDING ANY OTHER PROVISION OF THIS SUBCHAPTER, THE CREDIT
ALLOWABLE UNDER THIS SUBDIVISION SHALL BE TAKEN PRIOR TO THE  TAKING  OF
ANY  OTHER  CREDIT  ALLOWED  BY  THIS SECTION. NOTWITHSTANDING ANY OTHER
PROVISION OF THIS SUBCHAPTER, THE APPLICATION OF THIS SUBDIVISION  SHALL
NOT CHANGE THE BASIS ON WHICH THE TAXPAYER'S TAX IS COMPUTED UNDER PARA-
GRAPH (E) OF SUBDIVISION ONE OF THIS SECTION.
  19.  LOWER  MANHATTAN RELOCATION AND EMPLOYMENT ASSISTANCE CREDIT. (A)
IN ADDITION TO ANY OTHER CREDIT ALLOWED BY THIS SECTION, A TAXPAYER THAT
HAS OBTAINED THE CERTIFICATIONS REQUIRED BY CHAPTER SIX-C OF TITLE TWEN-
TY-TWO OF THIS CODE SHALL BE ALLOWED A CREDIT AGAINST THE TAX IMPOSED BY
THIS SUBCHAPTER. THE AMOUNT OF THE CREDIT SHALL BE THE AMOUNT DETERMINED
BY MULTIPLYING THREE THOUSAND DOLLARS BY THE NUMBER OF  ELIGIBLE  AGGRE-
GATE  EMPLOYMENT  SHARES  MAINTAINED  BY THE TAXPAYER DURING THE TAXABLE
YEAR WITH RESPECT TO ELIGIBLE PREMISES TO WHICH THE TAXPAYER  HAS  RELO-
CATED;  PROVIDED, HOWEVER, THAT NO CREDIT SHALL BE ALLOWED FOR THE RELO-
CATION OF ANY RETAIL ACTIVITY OR HOTEL SERVICES; PROVIDED, FURTHER, THAT
NO CREDIT SHALL BE ALLOWED UNDER THIS SUBDIVISION TO ANY  TAXPAYER  THAT
HAS  ELECTED  PURSUANT TO SUBDIVISION (D) OF SECTION 22-624 OF THIS CODE
TO TAKE SUCH CREDIT AGAINST A GROSS RECEIPTS TAX IMPOSED  UNDER  CHAPTER
ELEVEN  OF  THIS  TITLE.  FOR  PURPOSES  OF  THIS SUBDIVISION, THE TERMS
"ELIGIBLE AGGREGATE EMPLOYMENT SHARES," "ELIGIBLE PREMISES," "RELOCATE,"
"RETAIL ACTIVITY" AND "HOTEL SERVICES" SHALL HAVE THE MEANINGS  ASCRIBED
BY SECTION 22-623 OF THIS CODE.
  (B) THE CREDIT ALLOWED UNDER THIS SUBDIVISION WITH RESPECT TO ELIGIBLE
AGGREGATE EMPLOYMENT SHARES MAINTAINED WITH RESPECT TO ELIGIBLE PREMISES
TO  WHICH  THE  TAXPAYER  HAS RELOCATED SHALL BE ALLOWED FOR THE TAXABLE
YEAR OF THE RELOCATION AND FOR ANY  OF  THE  TWELVE  SUCCEEDING  TAXABLE
YEARS  DURING  WHICH ELIGIBLE AGGREGATE EMPLOYMENT SHARES ARE MAINTAINED
WITH RESPECT TO ELIGIBLE PREMISES; PROVIDED THAT THE CREDIT ALLOWED  FOR
THE  TWELFTH  SUCCEEDING TAXABLE YEAR SHALL BE CALCULATED BY MULTIPLYING
THE NUMBER OF  ELIGIBLE  AGGREGATE  EMPLOYMENT  SHARES  MAINTAINED  WITH
RESPECT  TO  ELIGIBLE PREMISES IN THE TWELFTH SUCCEEDING TAXABLE YEAR BY
THE LESSER OF ONE AND A FRACTION THE NUMERATOR OF WHICH IS  SUCH  NUMBER
OF  DAYS  IN  THE TAXABLE YEAR OF RELOCATION LESS THE NUMBER OF DAYS THE
TAXPAYER MAINTAINED EMPLOYMENT SHARES IN ELIGIBLE PREMISES IN THE  TAXA-
BLE  YEAR  OF  RELOCATION  AND THE DENOMINATOR OF WHICH IS THE NUMBER OF
DAYS IN SUCH TWELFTH TAXABLE YEAR DURING WHICH SUCH  ELIGIBLE  AGGREGATE
EMPLOYMENT SHARES ARE MAINTAINED WITH RESPECT TO SUCH PREMISES.
  (C)  EXCEPT  AS  PROVIDED IN PARAGRAPH (D) OF THIS SUBDIVISION, IF THE
AMOUNT OF THE CREDIT ALLOWABLE UNDER THIS SUBDIVISION  FOR  ANY  TAXABLE
YEAR  EXCEEDS  THE  TAX IMPOSED FOR SUCH YEAR, THE EXCESS MAY BE CARRIED
OVER, IN ORDER, TO THE FIVE IMMEDIATELY SUCCEEDING TAXABLE YEARS AND, TO

S. 4610--A                         46                         A. 6721--A

THE EXTENT NOT PREVIOUSLY DEDUCTIBLE, MAY BE DEDUCTED FROM  THE  TAXPAY-
ER'S TAX FOR SUCH YEARS.
  (D)  THE  CREDITS  ALLOWED  UNDER  THIS  SUBDIVISION,  AGAINST THE TAX
IMPOSED BY THIS CHAPTER FOR THE TAXABLE YEAR OF THE RELOCATION  AND  FOR
THE  FOUR  TAXABLE YEARS IMMEDIATELY SUCCEEDING THE TAXABLE YEAR OF SUCH
RELOCATION, SHALL BE DEEMED TO BE OVERPAYMENTS OF TAX BY THE TAXPAYER TO
BE CREDITED OR  REFUNDED,  WITHOUT  INTEREST,  IN  ACCORDANCE  WITH  THE
PROVISIONS  OF  SECTION  11-677 OF THIS CHAPTER. FOR SUCH TAXABLE YEARS,
SUCH CREDITS OR PORTIONS THEREOF MAY NOT BE CARRIED OVER TO ANY SUCCEED-
ING TAXABLE YEAR.
  (E) THE CREDIT ALLOWABLE UNDER  THIS  SUBDIVISION  SHALL  BE  DEDUCTED
AFTER THE CREDITS ALLOWED BY SUBDIVISIONS SEVENTEEN AND EIGHTEEN OF THIS
SECTION,  BUT PRIOR TO THE DEDUCTION OF ANY OTHER CREDIT ALLOWED BY THIS
SECTION.
  (F) NOTWITHSTANDING ANY OTHER PROVISION OF  THIS  SUBDIVISION  TO  THE
CONTRARY, IN THE CASE OF A TAXPAYER THAT HAS OBTAINED, PURSUANT TO CHAP-
TER SIX-C OF TITLE TWENTY-TWO OF THIS CODE, A CERTIFICATION OF ELIGIBIL-
ITY  AND HAS RECEIVED, IN A TAXABLE YEAR BEGINNING BEFORE JANUARY FIRST,
TWO THOUSAND FIFTEEN, THE CREDIT SET FORTH IN  SUBDIVISION  NINETEEN  OF
SECTION  11-604  OF THIS CHAPTER OR SECTION 11-643.9 OF THIS CHAPTER FOR
THE RELOCATION OF AN ELIGIBLE BUSINESS, A CREDIT SHALL BE ALLOWED  UNDER
THIS  SUBDIVISION  TO  THE TAXPAYER FOR ANY TAXABLE YEAR BEGINNING ON OR
AFTER JANUARY FIRST, TWO THOUSAND FIFTEEN IN THE SAME AMOUNT AND TO  THE
SAME  EXTENT  THAT  A  CREDIT  WOULD HAVE BEEN ALLOWED UNDER SUBDIVISION
NINETEEN OF SECTION 11-604 OF THIS CHAPTER OR SECTION 11-643.9  OF  THIS
CHAPTER,  AS  IN EFFECT ON DECEMBER THIRTY-FIRST, TWO THOUSAND FOURTEEN,
IF SUCH SUBDIVISION CONTINUED TO APPLY TO THE TAXPAYER FOR SUCH  TAXABLE
YEAR.
  20. INTENTIONALLY OMITTED.
  21.  BIOTECHNOLOGY  CREDIT.  (A)  (1)  A  TAXPAYER THAT IS A QUALIFIED
EMERGING TECHNOLOGY COMPANY, ENGAGES IN BIOTECHNOLOGIES, AND  MEETS  THE
ELIGIBILITY  REQUIREMENTS OF THIS SUBDIVISION, SHALL BE ALLOWED A CREDIT
AGAINST THE TAX IMPOSED BY THIS SUBCHAPTER. THE AMOUNT OF  CREDIT  SHALL
BE  EQUAL  TO  THE  SUM OF THE AMOUNTS SPECIFIED IN SUBPARAGRAPHS THREE,
FOUR AND FIVE OF THIS PARAGRAPH, SUBJECT TO THE LIMITATIONS IN  SUBPARA-
GRAPH SEVEN OF THIS PARAGRAPH AND PARAGRAPH (B) OF THIS SUBDIVISION. FOR
THE  PURPOSES OF THIS SUBDIVISION, "QUALIFIED EMERGING TECHNOLOGY COMPA-
NY" SHALL MEAN A COMPANY LOCATED IN THE CITY: (I) WHOSE PRIMARY PRODUCTS
OR SERVICES ARE CLASSIFIED AS  EMERGING  TECHNOLOGIES  AND  WHOSE  TOTAL
ANNUAL  PRODUCT SALES ARE TEN MILLION DOLLARS OR LESS; OR (II) A COMPANY
THAT HAS RESEARCH AND DEVELOPMENT ACTIVITIES IN THE CITY AND WHOSE RATIO
OF RESEARCH AND DEVELOPMENT FUNDS TO NET SALES  EQUALS  OR  EXCEEDS  THE
AVERAGE RATIO FOR ALL SURVEYED COMPANIES CLASSIFIED AS DETERMINED BY THE
NATIONAL  SCIENCE  FOUNDATION  IN THE MOST RECENT PUBLISHED RESULTS FROM
ITS SURVEY OF INDUSTRY  RESEARCH  AND  DEVELOPMENT,  OR  ANY  COMPARABLE
SUCCESSOR  SURVEY  AS DETERMINED BY THE DEPARTMENT OF FINANCE, AND WHOSE
TOTAL ANNUAL PRODUCT SALES ARE TEN MILLION  DOLLARS  OR  LESS.  FOR  THE
PURPOSES OF THIS SUBDIVISION, THE DEFINITION OF RESEARCH AND DEVELOPMENT
FUNDS  SHALL BE THE SAME AS THAT USED BY THE NATIONAL SCIENCE FOUNDATION
IN THE AFOREMENTIONED SURVEY. FOR  THE  PURPOSES  OF  THIS  SUBDIVISION,
"BIOTECHNOLOGIES"  SHALL  MEAN THE 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,  MECHANICAL,  AND  COMPUTATIONAL
APPLICATIONS  AND SERVICES CONNECTED WITH THESE IMPROVEMENTS. ACTIVITIES

S. 4610--A                         47                         A. 6721--A

INCLUDED WITH SUCH APPLICATIONS AND SERVICES SHALL INCLUDE, BUT  NOT  BE
LIMITED TO, ALTERNATIVE MRNA SPLICING, DNA SEQUENCE AMPLIFICATION, ANTI-
GENETIC  SWITCHING BIOAUGMENTATION, BIOENRICHMENT, BIOREMEDIATION, CHRO-
MOSOME  WALKING, CYTOGENETIC ENGINEERING, DNA DIAGNOSIS, FINGERPRINTING,
AND SEQUENCING, ELECTROPORATION, GENE  TRANSLOCATION,  GENETIC  MAPPING,
SITE-DIRECTED  MUTAGENESIS,  BIO-TRANSDUCTION, BIO-MECHANICAL AND BIO-E-
LECTRICAL ENGINEERING, AND BIO-INFORMATICS.
  (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  THE CITY, (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 THE CALENDAR
YEAR  ENDING  WITH  OR  WITHIN  THE TAXABLE YEAR FOR WHICH THE CREDIT IS
CLAIMED, AND (III) HAVE GROSS REVENUES, ALONG WITH THE GROSS REVENUES OF
ITS "AFFILIATES" AND "RELATED  MEMBERS"  NOT  EXCEEDING  TWENTY  MILLION
DOLLARS  FOR  THE  CALENDAR YEAR IMMEDIATELY PRECEDING THE CALENDAR YEAR
ENDING WITH OR WITHIN THE TAXABLE YEAR FOR WHICH THE CREDIT IS  CLAIMED.
FOR  THE  PURPOSES  OF  THIS  SUBDIVISION, "AFFILIATES" SHALL MEAN THOSE
CORPORATIONS THAT ARE MEMBERS OF THE SAME AFFILIATED GROUP  (AS  DEFINED
IN  SECTION  FIFTEEN  HUNDRED  FOUR OF THE INTERNAL REVENUE CODE) AS THE
TAXPAYER. FOR THE  PURPOSES  OF  THIS  SUBDIVISION,  THE  TERM  "RELATED
MEMBERS" SHALL MEAN 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 ENTI-
TY,  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 CHAPTERS FIVE,
ELEVEN AND SEVENTEEN OF THIS TITLE, AND THIS SUBCHAPTER AND  SUBCHAPTERS
TWO AND THREE OF THIS CHAPTER. A CONTROLLING INTEREST SHALL MEAN, 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 IN THE CASE OF A PARTNERSHIP,
ASSOCIATION,  TRUST OR OTHER ENTITY, THIRTY PERCENT OR MORE OF THE CAPI-
TAL, PROFITS OR BENEFICIAL INTEREST IN  SUCH  PARTNERSHIP,  ASSOCIATION,
TRUST OR OTHER ENTITY.
  (3)  AN  ELIGIBLE  TAXPAYER SHALL BE ALLOWED A CREDIT FOR EIGHTEEN PER
CENTUM OF THE COST OR OTHER BASIS FOR FEDERAL  INCOME  TAX  PURPOSES  OF
RESEARCH  AND  DEVELOPMENT  PROPERTY THAT IS ACQUIRED BY THE TAXPAYER BY
PURCHASE  AS  DEFINED  IN  SUBSECTION  (D)  OF   SECTION   ONE   HUNDRED
SEVENTY-NINE  OF  THE INTERNAL REVENUE CODE AND PLACED IN SERVICE DURING
THE CALENDAR YEAR THAT ENDS WITH OR WITHIN THE TAXABLE  YEAR  FOR  WHICH
THE  CREDIT  IS  CLAIMED.    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  OTHER  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, (III) FEES FOR USE OF SOPHISTICATED TECH-
NOLOGY FACILITIES AND PROCESSES, AND (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  ACTIVITIES RELATING TO BIOTECHNOLOGIES. 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 SUBCHAPTER. FOR THE  PURPOSES  OF  THIS  SUBDIVISION,

S. 4610--A                         48                         A. 6721--A

"RESEARCH AND DEVELOPMENT PROPERTY" SHALL MEAN PROPERTY THAT IS USED FOR
PURPOSES  OF  RESEARCH AND DEVELOPMENT IN THE EXPERIMENTAL OR LABORATORY
SENSE. SUCH PURPOSES SHALL NOT BE DEEMED TO INCLUDE THE ORDINARY TESTING
OR  INSPECTION  OF MATERIALS OR PRODUCTS FOR QUALITY CONTROL, EFFICIENCY
SURVEYS, MANAGEMENT STUDIES, CONSUMER SURVEYS, ADVERTISING,  PROMOTIONS,
OR RESEARCH IN CONNECTION WITH LITERARY, HISTORICAL OR SIMILAR PROJECTS.
  (4) AN ELIGIBLE TAXPAYER SHALL BE ALLOWED A CREDIT FOR NINE PER CENTUM
OF  QUALIFIED  RESEARCH EXPENSES PAID OR INCURRED BY THE TAXPAYER IN THE
CALENDAR YEAR THAT ENDS WITH OR WITHIN THE TAXABLE YEAR  FOR  WHICH  THE
CREDIT  IS  CLAIMED.  FOR  THE  PURPOSES OF THIS SUBDIVISION, "QUALIFIED
RESEARCH EXPENSES" SHALL MEAN EXPENSES ASSOCIATED WITH IN-HOUSE RESEARCH
AND PROCESSES, AND  COSTS  ASSOCIATED  WITH  THE  DISSEMINATION  OF  THE
RESULTS  OF  THE  PRODUCTS  THAT  DIRECTLY RESULT FROM SUCH RESEARCH AND
DEVELOPMENT ACTIVITIES; PROVIDED, HOWEVER, THAT  SUCH  COSTS  SHALL  NOT
INCLUDE ADVERTISING OR PROMOTION THROUGH MEDIA. IN ADDITION, COSTS ASSO-
CIATED  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 QUALIFY AS QUALIFIED RESEARCH EXPENSES. IN NO CASE SHALL
THE CREDIT ALLOWED UNDER THIS SUBPARAGRAPH APPLY TO EXPENSES  FOR  LITI-
GATION  OR  THE  CHALLENGE  OF  ANOTHER  ENTITY'S  INTELLECTUAL PROPERTY
RIGHTS, OR FOR CONTRACT EXPENSES INVOLVING OUTSIDE PAID CONSULTANTS.
  (5) AN ELIGIBLE TAXPAYER SHALL  BE  ALLOWED  A  CREDIT  FOR  QUALIFIED
HIGH-TECHNOLOGY  TRAINING EXPENDITURES AS DESCRIBED IN THIS SUBPARAGRAPH
PAID OR INCURRED BY THE TAXPAYER DURING THE CALENDAR YEAR THAT ENDS WITH
OR WITHIN THE TAXABLE YEAR FOR WHICH THE CREDIT IS CLAIMED.
  (I) THE AMOUNT OF CREDIT SHALL BE ONE HUNDRED PERCENT OF THE  TRAINING
EXPENSES  DESCRIBED  IN  CLAUSE (III) OF THIS SUBPARAGRAPH, SUBJECT TO A
LIMITATION OF NO MORE THAN FOUR THOUSAND DOLLARS PER EMPLOYEE PER CALEN-
DAR YEAR FOR SUCH TRAINING EXPENSES.
  (II) QUALIFIED HIGH-TECHNOLOGY TRAINING  SHALL  INCLUDE  A  COURSE  OR
COURSES TAKEN AND SATISFACTORILY COMPLETED BY AN EMPLOYEE OF THE TAXPAY-
ER AT AN ACCREDITED, DEGREE GRANTING POST-SECONDARY COLLEGE OR UNIVERSI-
TY  IN  THE  CITY THAT (A) DIRECTLY RELATES TO BIOTECHNOLOGY ACTIVITIES,
AND (B) IS INTENDED TO UPGRADE, RETRAIN OR IMPROVE THE  PRODUCTIVITY  OR
THEORETICAL  AWARENESS  OF  THE  EMPLOYEE.  SUCH  COURSE  OR COURSES MAY
INCLUDE, BUT ARE NOT LIMITED TO, INSTRUCTION  OR  RESEARCH  RELATING  TO
TECHNIQUES,  META,  MACRO,  OR  MICRO-THEORETICAL OR PRACTICAL KNOWLEDGE
BASES OR FRONTIERS, OR ETHICAL CONCERNS RELATED TO SUCH ACTIVITIES. SUCH
COURSE OR COURSES SHALL  NOT  INCLUDE  CLASSES  IN  THE  DISCIPLINES  OF
MANAGEMENT,  ACCOUNTING  OR THE LAW OR ANY CLASS DESIGNED TO FULFILL THE
DISCIPLINE SPECIFIC REQUIREMENTS OF A DEGREE PROGRAM AT  THE  ASSOCIATE,
BACCALAUREATE,  GRADUATE  OR  PROFESSIONAL  LEVEL  OF THESE DISCIPLINES.
SATISFACTORY COMPLETION OF A COURSE OR COURSES SHALL  MEAN  THE  EARNING
AND  GRANTING  OF  CREDIT  OR  EQUIVALENT UNIT, WITH THE ATTAINMENT OF A
GRADE OF "B" OR HIGHER IN A GRADUATE LEVEL COURSE OR COURSES, A GRADE OF
"C" OR HIGHER IN AN UNDERGRADUATE LEVEL COURSE OR COURSES, OR A  SIMILAR
MEASURE  OF  COMPETENCY FOR A COURSE THAT IS NOT MEASURED ACCORDING TO A
STANDARD GRADE FORMULA.
  (III) QUALIFIED HIGH-TECHNOLOGY TRAINING  EXPENDITURES  SHALL  INCLUDE
EXPENSES FOR TUITION AND MANDATORY FEES, SOFTWARE REQUIRED BY THE INSTI-
TUTION,  FEES FOR TEXTBOOKS OR OTHER LITERATURE REQUIRED BY THE INSTITU-
TION OFFERING THE COURSE OR COURSES, MINUS APPLICABLE  SCHOLARSHIPS  AND
TUITION  OR FEE WAIVERS NOT GRANTED BY THE TAXPAYER OR ANY AFFILIATES OF
THE TAXPAYER, THAT ARE PAID OR REIMBURSED  BY  THE  TAXPAYER.  QUALIFIED
HIGH-TECHNOLOGY  EXPENDITURES  DO  NOT  INCLUDE ROOM AND BOARD, COMPUTER

S. 4610--A                         49                         A. 6721--A

HARDWARE OR SOFTWARE NOT SPECIFICALLY ASSIGNED FOR SUCH COURSE OR COURS-
ES, LATE-CHARGES, FINES OR MEMBERSHIP DUES AND  SIMILAR  EXPENSES.  SUCH
QUALIFIED  EXPENDITURES SHALL NOT BE ELIGIBLE FOR THE CREDIT PROVIDED BY
THIS SECTION UNLESS THE EMPLOYEE FOR WHOM THE EXPENDITURES ARE DISBURSED
IS CONTINUOUSLY EMPLOYED BY THE TAXPAYER IN A FULL-TIME, FULL-YEAR POSI-
TION  PRIMARILY  LOCATED  AT  A QUALIFIED SITE DURING THE PERIOD OF SUCH
COURSEWORK AND LASTING THROUGH AT LEAST ONE HUNDRED  EIGHTY  DAYS  AFTER
THE  SATISFACTORY  COMPLETION  OF  THE QUALIFYING COURSE-WORK. QUALIFIED
HIGH-TECHNOLOGY TRAINING EXPENDITURES SHALL  NOT  INCLUDE  EXPENSES  FOR
IN-HOUSE  OR SHARED TRAINING OUTSIDE OF A CITY HIGHER EDUCATION INSTITU-
TION OR THE USE OF  CONSULTANTS  OUTSIDE  OF  CREDIT  GRANTING  COURSES,
WHETHER SUCH CONSULTANTS FUNCTION INSIDE OF SUCH HIGHER EDUCATION INSTI-
TUTION OR NOT.
  (IV)  IF  A  TAXPAYER  RELOCATES  FROM  AN ACADEMIC BUSINESS INCUBATOR
FACILITY PARTNERED WITH AN ACCREDITED POST-SECONDARY EDUCATION  INSTITU-
TION  LOCATED WITHIN THE CITY, WHICH PROVIDES SPACE AND BUSINESS SUPPORT
SERVICES TO TAXPAYERS, TO ANOTHER SITE,  THE  CREDIT  PROVIDED  IN  THIS
SUBDIVISION  SHALL  BE ALLOWED FOR ALL EXPENDITURES REFERENCED IN CLAUSE
(III) OF THIS SUBPARAGRAPH PAID OR INCURRED IN THE TWO PRECEDING  CALEN-
DAR  YEARS  THAT  THE TAXPAYER WAS LOCATED IN SUCH AN INCUBATOR FACILITY
FOR EMPLOYEES OF THE TAXPAYER WHO  ALSO  RELOCATE  FROM  SAID  INCUBATOR
FACILITY TO SUCH CITY SITE AND ARE EMPLOYED AND PRIMARILY LOCATED BY THE
TAXPAYER  IN  THE  CITY.    SUCH EXPENDITURES IN THE TWO PRECEDING YEARS
SHALL BE ADDED TO  THE  AMOUNTS  OTHERWISE  QUALIFYING  FOR  THE  CREDIT
PROVIDED  BY THIS SUBDIVISION THAT WERE PAID OR INCURRED IN THE CALENDAR
YEAR THAT THE TAXPAYER RELOCATES FROM SUCH A FACILITY. SUCH EXPENDITURES
SHALL INCLUDE EXPENSES PAID FOR AN ELIGIBLE EMPLOYEE WHO IS A FULL-TIME,
FULL-YEAR EMPLOYEE OF SAID TAXPAYER DURING THE CALENDAR  YEAR  THAT  THE
TAXPAYER  RELOCATED  FROM AN INCUBATOR FACILITY NOTWITHSTANDING (A) THAT
SUCH EMPLOYEE WAS EMPLOYED FULL OR PART-TIME AS AN OFFICER, STAFF-PERSON
OR PAID INTERN OF THE TAXPAYER WHEN SUCH TAXPAYER WAS  LOCATED  AT  SUCH
INCUBATOR  FACILITY  OR  (B)  THAT  SUCH  EMPLOYEE  WAS NOT CONTINUOUSLY
EMPLOYED WHEN SUCH TAXPAYER WAS LOCATED AT THE INCUBATOR FACILITY DURING
THE ONE HUNDRED EIGHTY DAY PERIOD REFERRED TO IN CLAUSE  (III)  OF  THIS
SUBPARAGRAPH, PROVIDED SUCH EMPLOYEE RECEIVED WAGES OR EQUIVALENT INCOME
FOR  AT  LEAST  SEVEN  HUNDRED  FIFTY HOURS DURING ANY TWENTY-FOUR MONTH
PERIOD WHEN THE TAXPAYER WAS LOCATED AT  THE  INCUBATOR  FACILITY.  SUCH
EXPENDITURES  SHALL  INCLUDE  PAYMENTS  MADE  TO SUCH EMPLOYEE AFTER THE
TAXPAYER HAS RELOCATED FROM THE INCUBATOR FACILITY FOR QUALIFIED EXPEND-
ITURES IF SUCH PAYMENTS ARE MADE TO REIMBURSE AN EMPLOYEE  FOR  EXPENDI-
TURES  PAID  BY THE EMPLOYEE DURING SUCH TWO PRECEDING YEARS. THE CREDIT
PROVIDED UNDER THIS PARAGRAPH SHALL BE ALLOWED IN ANY TAXABLE YEAR  THAT
THE TAXPAYER QUALIFIES AS AN ELIGIBLE TAXPAYER.
  (V)  FOR  PURPOSES  OF THIS SUBDIVISION THE TERM "ACADEMIC YEAR" SHALL
MEAN THE ANNUAL PERIOD  OF  SESSIONS  OF  A  POST-SECONDARY  COLLEGE  OR
UNIVERSITY.
  (VI) FOR THE PURPOSES OF THIS SUBDIVISION THE TERM "ACADEMIC INCUBATOR
FACILITY"  SHALL  MEAN  A  FACILITY  PROVIDING LOW-COST SPACE, TECHNICAL
ASSISTANCE, SUPPORT SERVICES AND  EDUCATIONAL  OPPORTUNITIES,  INCLUDING
BUT  NOT  LIMITED  TO  CENTRAL  SERVICES  PROVIDED BY THE MANAGER OF THE
FACILITY TO THE TENANTS OF THE FACILITY, TO AN  ENTITY  LOCATED  IN  THE
CITY.  SUCH  ENTITY'S  PRIMARY  ACTIVITY MUST BE IN BIOTECHNOLOGIES, AND
SUCH ENTITY MUST BE IN THE FORMATIVE STAGE OF DEVELOPMENT. THE  ACADEMIC
INCUBATOR  FACILITY  AND  THE  ENTITY  MUST  ACT  IN PARTNERSHIP WITH AN
ACCREDITED POST-SECONDARY COLLEGE OR UNIVERSITY LOCATED IN THE CITY.  AN
ACADEMIC  INCUBATOR FACILITY'S MISSION SHALL BE TO PROMOTE JOB CREATION,

S. 4610--A                         50                         A. 6721--A

ENTREPRENEURSHIP, TECHNOLOGY TRANSFER, AND PROVIDE SUPPORT  SERVICES  TO
INCUBATOR  TENANTS,  INCLUDING,  BUT  NOT LIMITED TO, BUSINESS PLANNING,
MANAGEMENT  ASSISTANCE,  FINANCIAL-PACKAGING,  LINKAGES   TO   FINANCING
SERVICES, AND COORDINATING WITH OTHER SOURCES OF ASSISTANCE.
  (6)  AN ELIGIBLE TAXPAYER MAY CLAIM CREDITS UNDER THIS SUBDIVISION FOR
THREE CONSECUTIVE YEARS. IN NO CASE SHALL THE  CREDIT  ALLOWED  BY  THIS
SUBDIVISION  TO A TAXPAYER EXCEED TWO HUNDRED FIFTY THOUSAND DOLLARS PER
CALENDAR YEAR FOR ELIGIBLE EXPENDITURES MADE DURING SUCH CALENDAR YEAR.
  (7) THE CREDIT ALLOWED UNDER THIS SUBDIVISION  FOR  ANY  TAXABLE  YEAR
SHALL  NOT  REDUCE  THE  TAX  DUE  FOR SUCH YEAR TO LESS THAN THE AMOUNT
PRESCRIBED IN CLAUSE (IV) OF SUBPARAGRAPH ONE OF PARAGRAPH (E) OF SUBDI-
VISION ONE OF THIS SECTION. PROVIDED, HOWEVER, IF THE AMOUNT  OF  CREDIT
ALLOWED  UNDER  THIS SUBDIVISION 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  11-677  OF  THIS  CHAPTER;
PROVIDED, HOWEVER, THAT NOTWITHSTANDING THE PROVISIONS OF SECTION 11-679
OF THIS CHAPTER, NO INTEREST SHALL BE PAID THEREON.
  (8)  THE  CREDIT  ALLOWED UNDER THIS SUBDIVISION SHALL ONLY BE ALLOWED
FOR TAXABLE YEARS BEGINNING BEFORE JANUARY FIRST, TWO THOUSAND SIXTEEN.
  (B) (1) THE PERCENTAGE OF THE CREDIT ALLOWED TO A TAXPAYER UNDER  THIS
SUBDIVISION IN ANY CALENDAR YEAR SHALL BE:
  (I)  IF  THE  AVERAGE  NUMBER  OF  INDIVIDUALS EMPLOYED FULL TIME BY A
TAXPAYER IN THE CITY DURING THE CALENDAR YEAR THAT ENDS WITH  OR  WITHIN
THE TAXABLE YEAR FOR WHICH THE CREDIT IS CLAIMED IS AT LEAST ONE HUNDRED
FIVE  PERCENT  OF  THE  TAXPAYER'S  BASE  YEAR  EMPLOYMENT,  ONE HUNDRED
PERCENT, EXCEPT THAT IN NO CASE SHALL  THE  CREDIT  ALLOWED  UNDER  THIS
CLAUSE  EXCEED  TWO  HUNDRED  FIFTY  THOUSAND DOLLARS PER CALENDAR YEAR.
PROVIDED, HOWEVER, THE INCREASE IN BASE YEAR EMPLOYMENT SHALL NOT  APPLY
TO  A  TAXPAYER  ALLOWED  A  CREDIT UNDER THIS SUBDIVISION THAT WAS, (A)
LOCATED OUTSIDE OF THE CITY, (B) NOT DOING BUSINESS, OR (C) DID NOT HAVE
ANY EMPLOYEES, IN THE YEAR PRECEDING THE FIRST YEAR THAT THE  CREDIT  IS
CLAIMED.  ANY SUCH TAXPAYER SHALL BE ELIGIBLE FOR ONE HUNDRED PERCENT OF
THE CREDIT FOR THE FIRST CALENDAR YEAR THAT  ENDS  WITH  OR  WITHIN  THE
TAXABLE YEAR FOR WHICH THE CREDIT IS CLAIMED, PROVIDED THAT SUCH TAXPAY-
ER  LOCATES  IN  THE  CITY,  BEGINS  DOING BUSINESS IN THE CITY OR HIRES
EMPLOYEES IN THE CITY DURING SUCH CALENDAR YEAR AND IS OTHERWISE  ELIGI-
BLE FOR THE CREDIT PURSUANT TO THE PROVISIONS OF THIS SUBDIVISION.
  (II)  IF  THE  AVERAGE  NUMBER  OF INDIVIDUALS EMPLOYED FULL TIME BY A
TAXPAYER IN THE CITY DURING THE CALENDAR YEAR THAT ENDS WITH  OR  WITHIN
THE  TAXABLE  YEAR  FOR  WHICH  THE  CREDIT  IS CLAIMED IS LESS THAN ONE
HUNDRED FIVE PERCENT OF  THE  TAXPAYER'S  BASE  YEAR  EMPLOYMENT,  FIFTY
PERCENT,  EXCEPT  THAT  IN  NO  CASE SHALL THE CREDIT ALLOWED UNDER THIS
CLAUSE EXCEED ONE HUNDRED  TWENTY-FIVE  THOUSAND  DOLLARS  PER  CALENDAR
YEAR.  IN  THE CASE OF AN ENTITY LOCATED IN THE CITY RECEIVING SPACE AND
BUSINESS SUPPORT SERVICES BY AN  ACADEMIC  INCUBATOR  FACILITY,  IF  THE
AVERAGE  NUMBER  OF INDIVIDUALS EMPLOYED FULL TIME BY SUCH ENTITY IN THE
CITY DURING THE CALENDAR YEAR IN WHICH THE  CREDIT  ALLOWED  UNDER  THIS
SUBDIVISION  IS  CLAIMED  IS  LESS  THAN ONE HUNDRED FIVE PERCENT OF THE
TAXPAYER'S BASE YEAR EMPLOYMENT, THE CREDIT SHALL BE ZERO.
  (2) FOR THE PURPOSES OF THIS SUBDIVISION, "BASE YEAR EMPLOYMENT" MEANS
THE AVERAGE NUMBER OF INDIVIDUALS EMPLOYED FULL-TIME BY THE TAXPAYER  IN
THE CITY IN THE YEAR PRECEDING THE FIRST CALENDAR YEAR THAT ENDS WITH OR
WITHIN THE TAXABLE YEAR FOR WHICH THE CREDIT IS CLAIMED.
  (3)  FOR  THE PURPOSES OF THIS SUBDIVISION, AVERAGE NUMBER OF INDIVID-
UALS EMPLOYED FULL-TIME SHALL BE COMPUTED BY ADDING THE NUMBER  OF  SUCH

S. 4610--A                         51                         A. 6721--A

INDIVIDUALS  EMPLOYED  BY THE TAXPAYER AT THE END OF EACH QUARTER DURING
EACH CALENDAR YEAR OR OTHER APPLICABLE PERIOD AND DIVIDING  THE  SUM  SO
OBTAINED  BY  THE NUMBER OF SUCH QUARTERS OCCURRING WITHIN SUCH CALENDAR
YEAR OR OTHER APPLICABLE PERIOD.
  (4)  NOTWITHSTANDING ANYTHING CONTAINED IN THIS SECTION TO THE CONTRA-
RY, THE CREDIT PROVIDED BY THIS SUBDIVISION SHALL BE ALLOWED AGAINST THE
TAXES AUTHORIZED BY THIS CHAPTER FOR THE TAXABLE YEAR AFTER REDUCTION BY
ALL OTHER CREDITS PERMITTED BY THIS CHAPTER.
  (C) NOTWITHSTANDING ANY OTHER PROVISION OF  THIS  SUBDIVISION  TO  THE
CONTRARY, IN THE CASE OF A TAXPAYER THAT HAS RECEIVED, IN A TAXABLE YEAR
BEGINNING  BEFORE  JANUARY  FIRST,  TWO THOUSAND FIFTEEN, THE CREDIT SET
FORTH IN SUBDIVISION TWENTY-ONE OF SECTION 11-604 OF THIS CHAPTER FOR AN
ELIGIBLE ACQUISITION OF PROPERTY AND/OR  EXPENSE  PAID  OR  INCURRED,  A
CREDIT  SHALL  BE ALLOWED TO THE TAXPAYER UNDER THIS SUBDIVISION FOR ANY
TAX YEAR BEGINNING ON OR AFTER JANUARY FIRST, TWO  THOUSAND  FIFTEEN  IN
THE  SAME  AMOUNT  AND  TO THE SAME EXTENT THAT A CREDIT WOULD HAVE BEEN
ALLOWED UNDER SUBDIVISION TWENTY-ONE OF SECTION 11-604 OF THIS  CHAPTER,
AS  IN  EFFECT  ON DECEMBER THIRTY-FIRST, TWO THOUSAND FOURTEEN, IF SUCH
SUBDIVISION CONTINUED TO APPLY TO THE TAXPAYER FOR SUCH TAXABLE YEAR.
  S 11-654.1 NET OPERATING LOSS. 1. IN  COMPUTING  THE  BUSINESS  INCOME
SUBJECT  TO  TAX,  TAXPAYERS SHALL BE ALLOWED BOTH A PRIOR NET OPERATING
LOSS CONVERSION SUBTRACTION UNDER SUBDIVISION TWO OF THIS SECTION AND  A
NET  OPERATING  LOSS  DEDUCTION UNDER SUBDIVISION THREE OF THIS SECTION.
THE PRIOR NET  OPERATING  LOSS  CONVERSION  SUBTRACTION  COMPUTED  UNDER
SUBDIVISION TWO OF THIS SECTION SHALL BE APPLIED AGAINST BUSINESS INCOME
BEFORE THE NET OPERATING LOSS DEDUCTION COMPUTED UNDER SUBDIVISION THREE
OF THIS SECTION.
  2.  PRIOR NET OPERATING LOSS CONVERSION SUBTRACTION.  (A) DEFINITIONS.
(1) "BASE YEAR" MEANS THE LAST TAXABLE YEAR BEGINNING ON OR AFTER  JANU-
ARY  FIRST, TWO THOUSAND FOURTEEN AND BEFORE JANUARY FIRST, TWO THOUSAND
FIFTEEN.
  (2) "UNABSORBED NET OPERATING LOSS" MEANS THE  UNABSORBED  PORTION  OF
NET  OPERATING  LOSS  AS  CALCULATED  UNDER PARAGRAPH (F) OF SUBDIVISION
EIGHT OF SECTION 11-602 OF THIS CHAPTER OR SUBDIVISION (K-1) OF  SECTION
11-641  OF  THIS  CHAPTER,  AS  SUCH SECTIONS WERE IN EFFECT ON DECEMBER
THIRTY-FIRST, TWO THOUSAND FOURTEEN, THAT WAS NOT DEDUCTIBLE IN PREVIOUS
TAXABLE YEARS AND WAS ELIGIBLE FOR CARRYOVER ON THE LAST DAY OF THE BASE
YEAR SUBJECT TO THE  LIMITATIONS  FOR  DEDUCTION  UNDER  SUCH  SECTIONS,
INCLUDING  ANY  NET  OPERATING LOSS SUSTAINED BY THE TAXPAYER DURING THE
BASE YEAR.
  (3) "BASE YEAR BAP" MEANS THE TAXPAYER'S BUSINESS ALLOCATION  PERCENT-
AGE  AS  CALCULATED  UNDER PARAGRAPH (A) OF SUBDIVISION THREE OF SECTION
11-604 OF THIS CHAPTER FOR THE BASE YEAR, OR THE  TAXPAYER'S  ALLOCATION
PERCENTAGE  AS  CALCULATED  UNDER  SECTION  11-642  OF  THIS CHAPTER FOR
PURPOSES OF CALCULATING ENTIRE NET INCOME FOR THE  BASE  YEAR,  AS  SUCH
SECTIONS WERE IN EFFECT ON DECEMBER THIRTY-FIRST, TWO THOUSAND FOURTEEN.
  (4)  "BASE  YEAR  TAX RATE" MEANS THE TAXPAYER'S TAX RATE FOR THE BASE
YEAR AS APPLIED TO ENTIRE NET INCOME AND  CALCULATED  UNDER  SUBDIVISION
ONE  OF  SECTION  11-604  OF  THIS CHAPTER OR SUBDIVISION (A) OF SECTION
11-643.5 OF THIS CHAPTER, AS SUCH PROVISIONS WERE IN EFFECT ON  DECEMBER
THIRTY-FIRST, TWO THOUSAND FOURTEEN.
  (B)  THE  PRIOR  NET  OPERATING  LOSS  CONVERSION SUBTRACTION SHALL BE
CALCULATED AS FOLLOWS:
  (1) THE TAXPAYER SHALL FIRST CALCULATE THE TAX VALUE OF ITS UNABSORBED
NET OPERATING LOSS FOR THE BASE YEAR. THE VALUE IS EQUAL TO THE  PRODUCT
OF  (I) THE AMOUNT OF THE TAXPAYER'S UNABSORBED NET OPERATING LOSS, (II)

S. 4610--A                         52                         A. 6721--A

THE TAXPAYER'S BASE YEAR BAP, AND (III) THE  TAXPAYER'S  BASE  YEAR  TAX
RATE.
  (2)  THE  PRODUCT  DETERMINED UNDER SUBPARAGRAPH ONE OF THIS PARAGRAPH
SHALL THEN BE DIVIDED BY EIGHT AND EIGHTY-FIVE ONE HUNDREDTHS PER CENTUM
OR, IN THE CASE OF A FINANCIAL CORPORATION, AS DEFINED IN CLAUSE (I)  OF
SUBPARAGRAPH  ONE  OF PARAGRAPH (E) OF SUBDIVISION ONE OF SECTION 11-654
OF THIS SUBCHAPTER, THE PRODUCT DETERMINED  UNDER  SUBPARAGRAPH  ONE  OF
THIS  PARAGRAPH  SHALL  THEN  BE DIVIDED BY NINE PER CENTUM. THIS RESULT
SHALL  EQUAL  THE  TAXPAYER'S  PRIOR  NET  OPERATING   LOSS   CONVERSION
SUBTRACTION POOL.
  (3) THE TAXPAYER'S PRIOR NET OPERATING LOSS CONVERSION SUBTRACTION FOR
THE  TAXABLE  YEAR SHALL EQUAL ONE-TENTH OF ITS PRIOR NET OPERATING LOSS
CONVERSION SUBTRACTION POOL, PLUS ANY AMOUNT OF UNUSED PRIOR NET OPERAT-
ING LOSS CONVERSION SUBTRACTION FROM PRECEDING TAXABLE YEARS.
  (4) IN LIEU OF THE PRIOR NET  OPERATING  LOSS  CONVERSION  SUBTRACTION
DESCRIBED  IN  SUBPARAGRAPH  THREE OF THIS PARAGRAPH, IF THE TAXPAYER SO
ELECTS, THE TAXPAYER'S PRIOR NET OPERATING LOSS  CONVERSION  SUBTRACTION
FOR  ITS TAXABLE YEARS BEGINNING ON OR AFTER JANUARY FIRST, TWO THOUSAND
FIFTEEN AND BEFORE JANUARY FIRST, TWO THOUSAND SEVENTEEN SHALL EQUAL, IN
EACH YEAR, NOT MORE THAN  ONE-HALF  OF  ITS  PRIOR  NET  OPERATING  LOSS
CONVERSION  SUBTRACTION POOL UNTIL THE POOL IS EXHAUSTED. IF THE POOL IS
NOT EXHAUSTED AT THE END OF SUCH TIME PERIOD, THE REMAINDER OF THE  POOL
SHALL  BE  FORFEITED. THE TAXPAYER SHALL MAKE SUCH ELECTION, WHICH SHALL
BE REVOCABLE, ON ITS FIRST RETURN FOR THE TAX YEAR BEGINNING ON OR AFTER
JANUARY FIRST, TWO THOUSAND FIFTEEN AND BEFORE JANUARY FIRST, TWO  THOU-
SAND  SIXTEEN BY THE DUE DATE FOR SUCH RETURN (DETERMINED WITH REGARD TO
EXTENSIONS).
  (C) (1) WHERE A TAXPAYER WAS  PROPERLY  INCLUDED  OR  REQUIRED  TO  BE
INCLUDED  IN  A  COMBINED  REPORT  FOR THE BASE YEAR PURSUANT TO SECTION
11-605 OF THIS CHAPTER OR A COMBINED RETURN FOR THE BASE  YEAR  PURSUANT
TO  SECTION  11-646  OF THIS CHAPTER, AS SUCH SECTIONS WERE IN EFFECT ON
DECEMBER THIRTY-FIRST, TWO THOUSAND FOURTEEN, AND  THE  MEMBERS  OF  THE
COMBINED  GROUP  FOR  THE  BASE  YEAR ARE THE SAME AS THE MEMBERS OF THE
COMBINED GROUP FOR THE TAXABLE  YEAR  IMMEDIATELY  SUCCEEDING  THE  BASE
YEAR,  THE  COMBINED  GROUP SHALL CALCULATE ITS PRIOR NET OPERATING LOSS
CONVERSION SUBTRACTION POOL USING THE COMBINED GROUP'S TOTAL  UNABSORBED
NET OPERATING LOSS, BASE YEAR BAP, AND BASE YEAR TAX RATE.
  (2)  IF  A  COMBINED  GROUP INCLUDES ADDITIONAL MEMBERS IN THE TAXABLE
YEAR IMMEDIATELY SUCCEEDING THE BASE YEAR THAT WERE NOT INCLUDED IN  THE
COMBINED  GROUP  DURING THE BASE YEAR, EACH BASE YEAR COMBINED GROUP AND
EACH TAXPAYER THAT FILED SEPARATELY FOR THE BASE YEAR BUT IS INCLUDED IN
THE COMBINED GROUP IN THE TAXABLE YEAR SUCCEEDING THE  BASE  YEAR  SHALL
CALCULATE  ITS PRIOR NET OPERATING LOSS CONVERSION SUBTRACTION POOL, AND
THE SUM OF THE POOLS SHALL BE THE  COMBINED  PRIOR  NET  OPERATING  LOSS
CONVERSION SUBTRACTION POOL OF THE COMBINED GROUP.
  (3)  IF  A TAXPAYER WAS PROPERLY INCLUDED IN A COMBINED REPORT FOR THE
BASE YEAR AND FILES A SEPARATE REPORT FOR  A  SUBSEQUENT  TAXABLE  YEAR,
THEN  THE  AMOUNT  OF  REMAINING  PRIOR  NET  OPERATING  LOSS CONVERSION
SUBTRACTION ALLOWED TO THE TAXPAYER FILING SUCH SEPARATE REPORT SHALL BE
PROPORTIONATE TO THE AMOUNT THAT SUCH TAXPAYER CONTRIBUTED TO THE  PRIOR
NET  OPERATING LOSS CONVERSION SUBTRACTION POOL ON A COMBINED BASIS, AND
THE REMAINING PRIOR NET OPERATING LOSS CONVERSION SUBTRACTION ALLOWED TO
THE REMAINING MEMBERS OF THE COMBINED GROUP SHALL BE REDUCED  ACCORDING-
LY.
  (4)  IF  A  TAXPAYER  FILED A SEPARATE REPORT FOR THE BASE YEAR AND IS
PROPERLY INCLUDED IN A COMBINED REPORT FOR A  SUBSEQUENT  TAXABLE  YEAR,

S. 4610--A                         53                         A. 6721--A

THEN  THE  PRIOR  NET  OPERATING LOSS CONVERSION SUBTRACTION POOL OF THE
COMBINED GROUP SHALL BE INCREASED BY THE AMOUNT OF THE  REMAINING  PRIOR
NET OPERATING LOSS CONVERSION SUBTRACTION ALLOWED TO THE TAXPAYER AT THE
TIME THE TAXPAYER IS PROPERLY INCLUDED IN THE COMBINED GROUP.
  (D) THE PRIOR NET OPERATING LOSS CONVERSION SUBTRACTION MAY BE USED TO
REDUCE  THE TAXPAYER'S TAX ON ALLOCATED BUSINESS INCOME TO THE HIGHER OF
THE TAX ON BUSINESS CAPITAL UNDER CLAUSE   (II) OF SUBPARAGRAPH  ONE  OF
PARAGRAPH (E) OF SUBDIVISION ONE OF SECTION 11-654 OF THIS SUBCHAPTER OR
THE  FIXED DOLLAR MINIMUM UNDER CLAUSE (IV) OF SUBPARAGRAPH ONE OF PARA-
GRAPH (E) OF SUBDIVISION ONE  OF  SECTION  11-654  OF  THIS  SUBCHAPTER.
UNLESS  THE  TAXPAYER HAS MADE THE ELECTION PROVIDED FOR IN SUBPARAGRAPH
FOUR OF PARAGRAPH (B) OF THIS SUBDIVISION, ANY AMOUNT  OF  UNUSED  PRIOR
NET  OPERATING LOSS CONVERSION SUBTRACTION SHALL BE CARRIED FORWARD TO A
SUBSEQUENT TAX YEAR OR SUBSEQUENT TAX YEARS UNTIL THE PRIOR NET  OPERAT-
ING  LOSS  CONVERSION  SUBTRACTION  POOL IS EXHAUSTED, BUT FOR NO LONGER
THAN TWENTY TAXABLE YEARS OR THE TAXABLE  YEAR  BEGINNING  ON  OR  AFTER
JANUARY  FIRST,  TWO  THOUSAND THIRTY-FIVE BUT BEFORE JANUARY FIRST, TWO
THOUSAND THIRTY-SIX, WHICHEVER COMES FIRST. SUCH AMOUNT CARRIED  FORWARD
SHALL  NOT BE SUBJECT TO THE ONE-TENTH LIMITATION FOR THE SUBSEQUENT TAX
YEAR OR YEARS UNDER SUBPARAGRAPH THREE OF PARAGRAPH (B) OF THIS SUBDIVI-
SION. HOWEVER, IF THE TAXPAYER ELECTS TO COMPUTE ITS PRIOR NET OPERATING
LOSS CONVERSION SUBTRACTION PURSUANT TO SUBPARAGRAPH FOUR  OF  PARAGRAPH
(B) OF THIS SUBDIVISION, THE TAXPAYER SHALL NOT CARRY FORWARD ANY UNUSED
AMOUNT  OF  SUCH  PRIOR NET OPERATING LOSS CONVERSION SUBTRACTION TO ANY
TAX YEAR BEGINNING ON OR AFTER JANUARY FIRST, TWO THOUSAND SEVENTEEN.
  3. IN COMPUTING BUSINESS INCOME, A NET OPERATING LOSS DEDUCTION  SHALL
BE  ALLOWED.  A  NET OPERATING LOSS DEDUCTION SHALL BE THE AMOUNT OF NET
OPERATING LOSS OR LOSSES FROM ONE OR MORE TAXABLE YEARS THAT ARE CARRIED
FORWARD OR CARRIED BACK TO A PARTICULAR TAXABLE YEAR.  A  NET  OPERATING
LOSS SHALL BE THE AMOUNT OF A BUSINESS LOSS INCURRED IN A PARTICULAR TAX
YEAR  MULTIPLIED  BY THE BUSINESS ALLOCATION PERCENTAGE FOR THAT YEAR AS
DETERMINED UNDER SUBDIVISION THREE OF SECTION 11-654 OF THIS SUBCHAPTER.
THE MAXIMUM NET OPERATING LOSS DEDUCTION THAT IS ALLOWED  IN  A  TAXABLE
YEAR  SHALL  BE  THE AMOUNT THAT REDUCES THE TAXPAYER'S TAX ON ALLOCATED
BUSINESS INCOME TO THE HIGHER OF  THE  TAX  ON  BUSINESS  CAPITAL  UNDER
CLAUSE  (II)  OF SUBPARAGRAPH ONE OF PARAGRAPH (E) OF SUBDIVISION ONE OF
SECTION 11-654 OF THIS SUBCHAPTER OR THE  FIXED  DOLLAR  MINIMUM  AMOUNT
UNDER  CLAUSE  (IV)  OF SUBPARAGRAPH ONE OF PARAGRAPH (E) OF SUBDIVISION
ONE OF SECTION 11-654 OF THIS  SUBCHAPTER.    SUCH  NET  OPERATING  LOSS
DEDUCTION  AND NET OPERATING LOSS SHALL BE DETERMINED IN ACCORDANCE WITH
THE FOLLOWING:
  (A) SUCH NET OPERATING LOSS DEDUCTION SHALL  NOT  BE  LIMITED  TO  THE
AMOUNT  ALLOWED  UNDER  SECTION  ONE HUNDRED SEVENTY-TWO OF THE INTERNAL
REVENUE CODE OR THE AMOUNT THAT WOULD HAVE BEEN ALLOWED IF THE  TAXPAYER
DID NOT HAVE AN ELECTION UNDER SUBCHAPTER S OF CHAPTER ONE OF THE INTER-
NAL REVENUE CODE IN EFFECT FOR THE APPLICABLE TAX YEAR.
  (B)  SUCH NET OPERATING LOSS DEDUCTION SHALL NOT INCLUDE ANY NET OPER-
ATING LOSS INCURRED DURING ANY TAXABLE YEAR BEGINNING PRIOR  TO  JANUARY
FIRST,  TWO  THOUSAND  FIFTEEN,  OR DURING ANY TAXABLE YEAR IN WHICH THE
TAXPAYER WAS NOT SUBJECT TO THE TAX IMPOSED BY THIS SUBCHAPTER.
  (C) A TAXPAYER THAT FILES AS PART OF A FEDERAL CONSOLIDATED RETURN BUT
ON A SEPARATE BASIS FOR PURPOSES OF THIS SUBCHAPTER  SHALL  COMPUTE  ITS
DEDUCTION  AND LOSS AS IF IT WERE FILING ON A SEPARATE BASIS FOR FEDERAL
INCOME TAX PURPOSES.
  (D) A NET OPERATING LOSS MAY  BE  CARRIED  BACK  THREE  TAXABLE  YEARS
PRECEDING  THE  TAXABLE  YEAR  OF  THE  LOSS  EXCEPT THAT NO LOSS MAY BE

S. 4610--A                         54                         A. 6721--A

CARRIED BACK TO A TAXABLE YEAR BEGINNING BEFORE JANUARY FIRST, TWO THOU-
SAND FIFTEEN. THE LOSS FIRST SHALL BE CARRIED TO  THE  EARLIEST  OF  THE
THREE TAXABLE YEARS PRECEDING THE TAXABLE YEAR OF THE LOSS. IF IT IS NOT
ENTIRELY  USED  IN  THAT YEAR, IT SHALL BE CARRIED TO THE SECOND TAXABLE
YEAR PRECEDING THE TAXABLE YEAR OF THE LOSS, AND  ANY  REMAINING  AMOUNT
SHALL  BE  CARRIED TO THE TAXABLE YEAR IMMEDIATELY PRECEDING THE TAXABLE
YEAR OF THE LOSS. ANY UNUSED  AMOUNT  OF  LOSS  THEN  REMAINING  MAY  BE
CARRIED  FORWARD FOR AS MANY AS TWENTY TAXABLE YEARS FOLLOWING THE TAXA-
BLE YEAR OF THE LOSS. LOSSES CARRIED FORWARD ARE CARRIED  FORWARD  FIRST
TO  THE TAXABLE YEAR IMMEDIATELY FOLLOWING THE TAXABLE YEAR OF THE LOSS,
THEN TO THE SECOND TAXABLE YEAR FOLLOWING THE TAXABLE YEAR OF THE  LOSS,
AND  THEN TO THE NEXT IMMEDIATELY SUBSEQUENT TAXABLE YEAR OR YEARS UNTIL
THE LOSS IS USED UP OR THE TWENTIETH TAXABLE YEAR FOLLOWING THE  TAXABLE
YEAR OF THE LOSS, WHICHEVER COMES FIRST.
  (E)  SUCH NET OPERATING LOSS DEDUCTION SHALL NOT INCLUDE ANY NET OPER-
ATING LOSS INCURRED DURING ANY TAXABLE  YEAR  COMMENCING  AFTER  JANUARY
FIRST,  TWO  THOUSAND  FIFTEEN  IF THE TAXPAYER WAS SUBJECT TO TAX UNDER
SUBCHAPTER TWO OR THREE OF THIS CHAPTER IN THAT YEAR; PROVIDED, HOWEVER,
ANY YEAR COMMENCING AFTER JANUARY FIRST, TWO THOUSAND FIFTEEN  THAT  THE
TAXPAYER  WAS SUBJECT TO TAX UNDER SUBCHAPTER TWO OR THREE OF THIS CHAP-
TER IN THAT YEAR MUST BE TREATED AS  A  TAXABLE  YEAR  FOR  PURPOSES  OF
DETERMINING  THE  NUMBER  OF TAXABLE YEARS TO WHICH A NET OPERATING LOSS
MAY BE CARRIED FORWARD.
  (F) WHERE THERE ARE TWO OR MORE ALLOCATED  NET  OPERATING  LOSSES,  OR
PORTIONS  THEREOF, CARRIED BACK OR CARRIED FORWARD TO BE DEDUCTED IN ONE
PARTICULAR TAX YEAR FROM ALLOCATED BUSINESS INCOME, THE  EARLIEST  ALLO-
CATED LOSS INCURRED MUST BE APPLIED FIRST.
  (G)  A  TAXPAYER  MAY  ELECT TO WAIVE THE ENTIRE CARRYBACK PERIOD WITH
RESPECT TO A NET OPERATING LOSS. SUCH  ELECTION  MUST  BE  MADE  ON  THE
TAXPAYER'S  ORIGINAL  TIMELY  FILED  RETURN  (DETERMINED  WITH REGARD TO
EXTENSIONS) FOR THE TAXABLE YEAR OF THE NET OPERATING LOSS FOR WHICH THE
ELECTION IS TO BE IN EFFECT. ONCE AN ELECTION  IS  MADE  FOR  A  TAXABLE
YEAR, IT SHALL BE IRREVOCABLE FOR THAT TAXABLE YEAR. A SEPARATE ELECTION
MUST BE MADE FOR EACH TAXABLE YEAR OF THE LOSS. THIS ELECTION APPLIES TO
ALL MEMBERS OF A COMBINED GROUP.
  S  11-654.2  RECEIPTS ALLOCATION. 1. THE PERCENTAGE OF RECEIPTS OF THE
TAXPAYER TO BE ALLOCATED TO THE CITY FOR PURPOSES OF SUBPARAGRAPH TWO OF
PARAGRAPH (A) OF SUBDIVISION THREE OF SECTION 11-654 OF THIS  SUBCHAPTER
SHALL  BE  EQUAL  TO  THE  RECEIPTS FRACTION DETERMINED PURSUANT TO THIS
SECTION. THE RECEIPTS FRACTION IS A FRACTION,  DETERMINED  BY  INCLUDING
ONLY THOSE RECEIPTS, NET INCOME, NET GAINS, AND OTHER ITEMS DESCRIBED IN
THIS  SECTION  THAT  ARE  INCLUDED  IN THE COMPUTATION OF THE TAXPAYER'S
BUSINESS INCOME (DETERMINED WITHOUT REGARD TO THE MODIFICATION  PROVIDED
IN  SUBPARAGRAPH  FOURTEEN  OF  PARAGRAPH  (A)  OF  SUBDIVISION EIGHT OF
SECTION 11-652 OF THIS SUBCHAPTER) FOR THE TAXABLE YEAR.  THE  NUMERATOR
OF  THE  RECEIPTS  FRACTION SHALL BE EQUAL TO THE SUM OF ALL THE AMOUNTS
REQUIRED TO BE INCLUDED IN THE NUMERATOR PURSUANT TO THE  PROVISIONS  OF
THIS SECTION AND THE DENOMINATOR OF THE RECEIPTS FRACTION SHALL BE EQUAL
TO THE SUM OF ALL THE AMOUNTS REQUIRED TO BE INCLUDED IN THE DENOMINATOR
PURSUANT TO THE PROVISIONS OF THIS SECTION.
  2.  (A)  RECEIPTS FROM SALES OF TANGIBLE PERSONAL PROPERTY WHERE SHIP-
MENTS ARE MADE TO POINTS WITHIN THE CITY OR THE DESTINATION OF THE PROP-
ERTY IS A POINT WITHIN THE CITY SHALL BE INCLUDED IN  THE  NUMERATOR  OF
THE RECEIPTS FRACTION. RECEIPTS FROM SALES OF TANGIBLE PERSONAL PROPERTY
WHERE  SHIPMENTS  ARE  MADE TO POINTS WITHIN AND WITHOUT THE CITY OR THE

S. 4610--A                         55                         A. 6721--A

DESTINATION IS WITHIN AND WITHOUT THE CITY  SHALL  BE  INCLUDED  IN  THE
DENOMINATOR OF THE RECEIPTS FRACTION.
  (B)  RECEIPTS FROM SALES OF ELECTRICITY DELIVERED TO POINTS WITHIN THE
CITY SHALL BE INCLUDED  IN  THE  NUMERATOR  OF  THE  RECEIPTS  FRACTION.
RECEIPTS  FROM SALES OF ELECTRICITY DELIVERED TO POINTS WITHIN AND WITH-
OUT THE CITY SHALL BE INCLUDED IN THE DENOMINATOR OF THE RECEIPTS  FRAC-
TION.
  (C)  RECEIPTS FROM SALES OF TANGIBLE PERSONAL PROPERTY AND ELECTRICITY
THAT ARE TRADED AS COMMODITIES AS THE TERM  "COMMODITY"  IS  DEFINED  IN
SECTION FOUR HUNDRED SEVENTY-FIVE OF THE INTERNAL REVENUE CODE, SHALL BE
INCLUDED  IN  THE  RECEIPTS  FRACTION  IN  ACCORDANCE WITH CLAUSE (I) OF
SUBPARAGRAPH TWO OF PARAGRAPH (A) OF SUBDIVISION FIVE OF THIS SECTION.
  (D) NET GAINS (NOT LESS THAN ZERO) FROM THE  SALES  OF  REAL  PROPERTY
LOCATED  WITHIN  THE  CITY  SHALL  BE  INCLUDED  IN THE NUMERATOR OF THE
RECEIPTS FRACTION. NET GAINS (NOT LESS THAN ZERO) FROM THE SALES OF REAL
PROPERTY LOCATED WITHIN AND WITHOUT THE CITY SHALL BE  INCLUDED  IN  THE
DENOMINATOR OF THE RECEIPTS FRACTION.
  3.  (A)  RECEIPTS  FROM RENTALS OF REAL AND TANGIBLE PERSONAL PROPERTY
LOCATED WITHIN THE CITY SHALL  BE  INCLUDED  IN  THE  NUMERATOR  OF  THE
RECEIPTS  FRACTION.  RECEIPTS FROM RENTALS OF REAL AND TANGIBLE PERSONAL
PROPERTY LOCATED WITHIN AND WITHOUT THE CITY SHALL BE  INCLUDED  IN  THE
DENOMINATOR OF THE RECEIPTS FRACTION.
  (B)  RECEIPTS OF ROYALTIES FROM THE USE OF PATENTS, COPYRIGHTS, TRADE-
MARKS, AND SIMILAR INTANGIBLE PERSONAL PROPERTY WITHIN THE CITY SHALL BE
INCLUDED IN THE NUMERATOR OF THE RECEIPTS FRACTION. RECEIPTS  OF  ROYAL-
TIES FROM THE USE OF PATENTS, COPYRIGHTS, TRADEMARKS, AND SIMILAR INTAN-
GIBLE PERSONAL PROPERTY WITHIN AND WITHOUT THE CITY SHALL BE INCLUDED IN
THE  DENOMINATOR  OF  THE RECEIPTS FRACTION. A PATENT, COPYRIGHT, TRADE-
MARK, OR SIMILAR INTANGIBLE PERSONAL PROPERTY IS USED WITHIN THE CITY TO
THE EXTENT THAT THE ACTIVITIES THEREUNDER  ARE  CARRIED  ON  WITHIN  THE
CITY.
  (C)  RECEIPTS  FROM  THE  SALES OF RIGHTS FOR CLOSED-CIRCUIT AND CABLE
TELEVISION TRANSMISSIONS OF AN EVENT (OTHER THAN EVENTS OCCURRING  ON  A
REGULARLY  SCHEDULED  BASIS) TAKING PLACE WITHIN THE CITY AS A RESULT OF
THE RENDITION OF SERVICES BY EMPLOYEES OF THE CORPORATION, AS  ATHLETES,
ENTERTAINERS  OR  PERFORMING ARTISTS, SHALL BE INCLUDED IN THE NUMERATOR
OF THE RECEIPTS FRACTION TO THE EXTENT THAT SUCH RECEIPTS ARE  ATTRIBUT-
ABLE  TO  SUCH  TRANSMISSIONS  RECEIVED  OR  EXHIBITED  WITHIN THE CITY.
RECEIPTS FROM ALL SALES OF RIGHTS FOR  CLOSED-CIRCUIT  AND  CABLE  TELE-
VISION TRANSMISSIONS OF AN EVENT (OTHER THAN EVENTS OCCURRING ON A REGU-
LARLY  SCHEDULED  BASIS)  SHALL  BE  INCLUDED  IN THE DENOMINATOR OF THE
RECEIPTS FRACTION.
  4. (A) FOR PURPOSES OF DETERMINING THE RECEIPTS  FRACTION  UNDER  THIS
SECTION,  THE  TERM  "DIGITAL PRODUCT" MEANS ANY PROPERTY OR SERVICE, OR
COMBINATION THEREOF, OF  WHATEVER  NATURE  DELIVERED  TO  THE  PURCHASER
THROUGH  THE  USE  OF  WIRE, CABLE, FIBER-OPTIC, LASER, MICROWAVE, RADIO
WAVE, SATELLITE OR SIMILAR SUCCESSOR MEDIA, OR ANY COMBINATION  THEREOF.
DIGITAL  PRODUCT  INCLUDES,  BUT IS NOT LIMITED TO, AN AUDIO WORK, AUDI-
OVISUAL WORK, VISUAL WORK, BOOK OR LITERARY WORK,  GRAPHIC  WORK,  GAME,
INFORMATION  OR  ENTERTAINMENT  SERVICE, STORAGE OF DIGITAL PRODUCTS AND
COMPUTER SOFTWARE BY WHATEVER MEANS DELIVERED. THE TERM  "DELIVERED  TO"
INCLUDES  FURNISHED  OR  PROVIDED  TO  OR ACCESSED BY. A DIGITAL PRODUCT
SHALL NOT INCLUDE LEGAL, MEDICAL, ACCOUNTING,  ARCHITECTURAL,  RESEARCH,
ANALYTICAL, ENGINEERING OR CONSULTING SERVICES PROVIDED BY THE TAXPAYER.
  (B)  RECEIPTS  FROM THE SALE OF, LICENSE TO USE, OR GRANTING OF REMOTE
ACCESS TO DIGITAL PRODUCTS WITHIN THE CITY, DETERMINED ACCORDING TO  THE

S. 4610--A                         56                         A. 6721--A

HIERARCHY  OF  METHODS  SET  FORTH  IN SUBPARAGRAPHS ONE THROUGH FOUR OF
PARAGRAPH (C) OF THIS SUBDIVISION, SHALL BE INCLUDED IN THE NUMERATOR OF
THE RECEIPTS FRACTION. RECEIPTS FROM THE SALE OF,  LICENSE  TO  USE,  OR
GRANTING  OF  REMOTE  ACCESS  TO DIGITAL PRODUCTS WITHIN AND WITHOUT THE
CITY SHALL BE INCLUDED IN THE DENOMINATOR OF THE RECEIPTS FRACTION.  THE
TAXPAYER  MUST  EXERCISE  DUE  DILIGENCE  UNDER EACH METHOD DESCRIBED IN
PARAGRAPH (C) OF THIS SUBDIVISION BEFORE REJECTING IT AND PROCEEDING  TO
THE  NEXT  METHOD  IN  THE HIERARCHY, AND MUST BASE ITS DETERMINATION ON
INFORMATION KNOWN TO THE TAXPAYER OR INFORMATION THAT WOULD BE KNOWN  TO
THE TAXPAYER UPON REASONABLE INQUIRY. IF THE RECEIPT FOR A DIGITAL PROD-
UCT IS COMPRISED OF A COMBINATION OF PROPERTY AND SERVICES, IT CANNOT BE
DIVIDED  INTO  SEPARATE  COMPONENTS  AND  SHALL  BE CONSIDERED TO BE ONE
RECEIPT REGARDLESS OF  WHETHER  IT  IS  SEPARATELY  STATED  FOR  BILLING
PURPOSES. THE ENTIRE RECEIPT MUST BE ALLOCATED BY THIS HIERARCHY.
  (C)  THE  HIERARCHY OF SOURCING METHODS IS AS FOLLOWS: (1) THE CUSTOM-
ER'S PRIMARY USE LOCATION OF THE DIGITAL PRODUCT; (2) THE LOCATION WHERE
THE DIGITAL PRODUCT IS RECEIVED BY THE CUSTOMER, OR  IS  RECEIVED  BY  A
PERSON DESIGNATED FOR RECEIPT BY THE CUSTOMER; (3) THE RECEIPTS FRACTION
DETERMINED  PURSUANT  TO THIS SUBDIVISION FOR THE PRECEDING TAXABLE YEAR
FOR SUCH DIGITAL PRODUCT; OR (4) THE RECEIPTS FRACTION  IN  THE  CURRENT
TAXABLE  YEAR  FOR  THOSE DIGITAL PRODUCTS THAT CAN BE SOURCED USING THE
HIERARCHY OF SOURCING METHODS IN SUBPARAGRAPHS ONE AND TWO OF THIS PARA-
GRAPH.
  5.  (A) A FINANCIAL INSTRUMENT IS A  "NONQUALIFIED  FINANCIAL  INSTRU-
MENT"  IF IT IS NOT A QUALIFIED FINANCIAL INSTRUMENT. A QUALIFIED FINAN-
CIAL INSTRUMENT MEANS A FINANCIAL INSTRUMENT THAT IS OF A TYPE DESCRIBED
IN ANY OF CLAUSE (I), (II),  (III),  (IV),  (VII),  (VIII)  OR  (IX)  OF
SUBPARAGRAPH TWO OF THIS PARAGRAPH AND THAT HAS BEEN MARKED TO MARKET IN
THE  TAXABLE  YEAR  BY THE TAXPAYER UNDER SECTION 475 OR SECTION 1256 OF
THE INTERNAL REVENUE CODE. FURTHER, IF THE TAXPAYER HAS IN  THE  TAXABLE
YEAR  MARKED  TO  MARKET A FINANCIAL INSTRUMENT OF THE TYPE DESCRIBED IN
ANY OF CLAUSE (I), (II), (III), (IV), (VII), (VIII) OR (IX) OF  SUBPARA-
GRAPH  TWO  OF THIS PARAGRAPH, THEN ANY FINANCIAL INSTRUMENT WITHIN THAT
TYPE DESCRIBED IN THE ABOVE SPECIFIED CLAUSE OR  CLAUSES  THAT  HAS  NOT
BEEN  MARKED TO MARKET BY THE TAXPAYER UNDER SECTION 475 OR SECTION 1256
OF THE INTERNAL REVENUE CODE IS A QUALIFIED FINANCIAL INSTRUMENT IN  THE
TAXABLE  YEAR.   NOTWITHSTANDING THE TWO PRECEDING SENTENCES, (I) A LOAN
SECURED BY REAL PROPERTY SHALL NOT BE A QUALIFIED FINANCIAL  INSTRUMENT,
(II)  IF  THE ONLY LOANS THAT ARE MARKED TO MARKET BY THE TAXPAYER UNDER
SECTION 475 OR SECTION 1256 OF  THE  INTERNAL  REVENUE  CODE  ARE  LOANS
SECURED  BY  REAL  PROPERTY,  THEN NO LOANS SHALL BE QUALIFIED FINANCIAL
INSTRUMENTS, AND (III) STOCK THAT IS INVESTMENT CAPITAL  AS  DEFINED  IN
PARAGRAPH  (A)  OF  SUBDIVISION  4  OF SECTION 11-652 OF THIS SUBCHAPTER
SHALL NOT BE A QUALIFIED  FINANCIAL  INSTRUMENT.  IF  A  CORPORATION  IS
INCLUDED  IN  A  COMBINED  REPORT, THE DEFINITION OF QUALIFIED FINANCIAL
INSTRUMENT SHALL BE DETERMINED ON A COMBINED BASIS.
  (1) IN DETERMINING THE INCLUSION OF RECEIPTS AND NET GAINS FROM QUALI-
FIED FINANCIAL INSTRUMENTS IN THE RECEIPTS FRACTION, TAXPAYERS MAY ELECT
TO USE THE FIXED PERCENTAGE METHOD DESCRIBED IN  THIS  SUBPARAGRAPH  FOR
QUALIFIED FINANCIAL INSTRUMENTS. THE ELECTION IS IRREVOCABLE, APPLIES TO
ALL QUALIFIED FINANCIAL INSTRUMENTS, AND MUST BE MADE ON AN ANNUAL BASIS
ON  THE TAXPAYER'S ORIGINAL, TIMELY FILED RETURN (DETERMINED WITH REGARD
TO EXTENSIONS).  IF THE TAXPAYER ELECTS  THE  FIXED  PERCENTAGE  METHOD,
THEN  ALL  INCOME, GAIN OR LOSS, INCLUDING MARKED TO MARKET NET GAINS AS
DEFINED IN CLAUSE (X) OF SUBPARAGRAPH TWO OF THIS PARAGRAPH, FROM QUALI-
FIED FINANCIAL INSTRUMENTS CONSTITUTE BUSINESS INCOME, GAIN OR LOSS.  IF

S. 4610--A                         57                         A. 6721--A

THE  TAXPAYER  DOES  NOT  ELECT TO USE THE FIXED PERCENTAGE METHOD, THEN
RECEIPTS AND NET GAINS ARE INCLUDED IN THE RECEIPTS FRACTION IN  ACCORD-
ANCE  WITH THE CUSTOMER SOURCING METHOD DESCRIBED IN SUBPARAGRAPH TWO OF
THIS  PARAGRAPH. UNDER THE FIXED PERCENTAGE METHOD, EIGHT PERCENT OF ALL
NET INCOME (NOT LESS THAN ZERO)  FROM  QUALIFIED  FINANCIAL  INSTRUMENTS
SHALL  BE  INCLUDED  IN  THE NUMERATOR OF THE RECEIPTS FRACTION. ALL NET
INCOME (NOT LESS THAN ZERO) FROM QUALIFIED FINANCIAL  INSTRUMENTS  SHALL
BE INCLUDED IN THE DENOMINATOR OF THE RECEIPTS FRACTION.
  (2)  RECEIPTS  AND  NET GAINS FROM QUALIFIED FINANCIAL INSTRUMENTS, IN
CASES WHERE THE TAXPAYER DID NOT ELECT TO USE THE FIXED PERCENTAGE METH-
OD DESCRIBED IN SUBPARAGRAPH ONE OF THIS PARAGRAPH, AND  FROM  NONQUALI-
FIED FINANCIAL INSTRUMENTS SHALL BE INCLUDED IN THE RECEIPTS FRACTION IN
ACCORDANCE  WITH  THIS  SUBPARAGRAPH. FOR PURPOSES OF THIS PARAGRAPH, AN
INDIVIDUAL IS DEEMED TO BE LOCATED WITHIN THE CITY IF HIS OR HER BILLING
ADDRESS IS WITHIN THE CITY. A BUSINESS ENTITY IS DEEMED  TO  BE  LOCATED
WITHIN THE CITY IF ITS COMMERCIAL DOMICILE IS LOCATED WITHIN THE CITY.
  (I)(A) RECEIPTS CONSTITUTING INTEREST FROM LOANS SECURED BY REAL PROP-
ERTY  LOCATED  WITHIN THE CITY SHALL BE INCLUDED IN THE NUMERATOR OF THE
RECEIPTS FRACTION. RECEIPTS CONSTITUTING INTEREST FROM LOANS SECURED  BY
REAL  PROPERTY  LOCATED WITHIN AND WITHOUT THE CITY SHALL BE INCLUDED IN
THE DENOMINATOR OF THE RECEIPTS FRACTION.
  (B) RECEIPTS CONSTITUTING INTEREST FROM  LOANS  NOT  SECURED  BY  REAL
PROPERTY  SHALL BE INCLUDED IN THE NUMERATOR OF THE RECEIPTS FRACTION IF
THE BORROWER IS LOCATED WITHIN THE CITY.  RECEIPTS CONSTITUTING INTEREST
FROM LOANS NOT SECURED BY REAL PROPERTY, WHETHER THE BORROWER IS LOCATED
WITHIN OR WITHOUT THE CITY, SHALL BE INCLUDED IN THE DENOMINATOR OF  THE
RECEIPTS FRACTION.
  (C) NET GAINS (NOT LESS THAN ZERO) FROM SALES OF LOANS SECURED BY REAL
PROPERTY  SHALL BE INCLUDED IN THE NUMERATOR OF THE RECEIPTS FRACTION AS
PROVIDED IN THIS SUBCLAUSE. THE AMOUNT OF NET GAINS FROM  THE  SALES  OF
LOANS SECURED BY REAL PROPERTY INCLUDED IN THE NUMERATOR OF THE RECEIPTS
FRACTION SHALL BE DETERMINED BY MULTIPLYING THE NET GAINS BY A FRACTION,
THE  NUMERATOR OF WHICH SHALL BE THE AMOUNT OF GROSS PROCEEDS FROM SALES
OF LOANS SECURED BY REAL PROPERTY LOCATED WITHIN THE CITY AND THE DENOM-
INATOR OF WHICH SHALL BE THE GROSS PROCEEDS FROM SALES OF LOANS  SECURED
BY  REAL  PROPERTY  LOCATED WITHIN AND WITHOUT THE CITY.  GROSS PROCEEDS
SHALL BE DETERMINED AFTER THE DEDUCTION OF ANY COST INCURRED TO  ACQUIRE
THE  LOANS  BUT  SHALL  NOT  BE LESS THAN ZERO. NET GAINS (NOT LESS THAN
ZERO) FROM SALES OF LOANS SECURED BY REAL PROPERTY  LOCATED  WITHIN  AND
WITHOUT  THE  CITY  SHALL BE INCLUDED IN THE DENOMINATOR OF THE RECEIPTS
FRACTION.
  (D) NET GAINS (NOT LESS THAN ZERO) FROM SALES OF LOANS NOT SECURED  BY
REAL  PROPERTY  SHALL BE INCLUDED IN THE NUMERATOR OF THE RECEIPTS FRAC-
TION AS PROVIDED IN THIS SUBCLAUSE. THE AMOUNT OF  NET  GAINS  FROM  THE
SALES OF LOANS NOT SECURED BY REAL PROPERTY INCLUDED IN THE NUMERATOR OF
THE  RECEIPTS  FRACTION SHALL BE DETERMINED BY MULTIPLYING THE NET GAINS
BY A FRACTION, THE NUMERATOR OF WHICH  SHALL  BE  THE  AMOUNT  OF  GROSS
PROCEEDS  FROM SALES OF LOANS NOT SECURED BY REAL PROPERTY TO PURCHASERS
LOCATED WITHIN THE CITY AND THE DENOMINATOR OF WHICH SHALL BE THE AMOUNT
OF GROSS PROCEEDS FROM SALES OF LOANS NOT SECURED BY  REAL  PROPERTY  TO
PURCHASERS  LOCATED WITHIN AND WITHOUT THE CITY. GROSS PROCEEDS SHALL BE
DETERMINED AFTER THE DEDUCTION OF ANY COST INCURRED TO ACQUIRE THE LOANS
BUT SHALL NOT BE LESS THAN ZERO. NET GAINS (NOT  LESS  THAN  ZERO)  FROM
SALES  OF  LOANS  NOT  SECURED BY REAL PROPERTY SHALL BE INCLUDED IN THE
DENOMINATOR OF THE RECEIPTS FRACTION.

S. 4610--A                         58                         A. 6721--A

  (E) FOR PURPOSES OF THIS SUBDIVISION, A LOAN IS SECURED BY REAL  PROP-
ERTY  IF  FIFTY  PERCENT  OR MORE OF THE VALUE OF THE COLLATERAL USED TO
SECURE THE LOAN, WHEN VALUED AT FAIR MARKET VALUE AS  OF  THE  TIME  THE
LOAN WAS ENTERED INTO, CONSISTS OF REAL PROPERTY.
  (II)  FEDERAL, STATE, AND MUNICIPAL DEBT. RECEIPTS CONSTITUTING INTER-
EST AND NET GAINS FROM SALES OF DEBT INSTRUMENTS ISSUED  BY  THE  UNITED
STATES,  ANY  STATE,  OR  POLITICAL  SUBDIVISION OF A STATE SHALL NOT BE
INCLUDED IN THE NUMERATOR OF THE RECEIPTS FRACTION.  RECEIPTS CONSTITUT-
ING INTEREST AND NET GAINS (NOT LESS  THAN  ZERO)  FROM  SALES  OF  DEBT
INSTRUMENTS ISSUED BY THE UNITED STATES AND THE STATE OF NEW YORK OR ITS
POLITICAL  SUBDIVISIONS,  INCLUDING  THE  CITY, SHALL BE INCLUDED IN THE
DENOMINATOR OF THE RECEIPTS FRACTION.  FIFTY  PERCENT  OF  THE  RECEIPTS
CONSTITUTING  INTEREST  AND NET GAINS (NOT LESS THAN ZERO) FROM SALES OF
DEBT INSTRUMENTS ISSUED BY OTHER STATES OR THEIR POLITICAL  SUBDIVISIONS
SHALL BE INCLUDED IN THE DENOMINATOR OF THE RECEIPTS FRACTION.
  (III)  ASSET BACKED SECURITIES AND OTHER GOVERNMENT AGENCY DEBT. EIGHT
PERCENT OF THE INTEREST INCOME FROM ASSET  BACKED  SECURITIES  OR  OTHER
SECURITIES  ISSUED  BY GOVERNMENT AGENCIES, INCLUDING BUT NOT LIMITED TO
SECURITIES  ISSUED  BY  THE  GOVERNMENT  NATIONAL  MORTGAGE  ASSOCIATION
(GNMA),  THE  FEDERAL  NATIONAL MORTGAGE ASSOCIATION (FNMA), THE FEDERAL
HOME LOAN MORTGAGE CORPORATION (FHLMC), OR THE SMALL  BUSINESS  ADMINIS-
TRATION, OR EIGHT PERCENT OF THE INTEREST INCOME FROM ASSET BACKED SECU-
RITIES  ISSUED  BY  OTHER ENTITIES SHALL BE INCLUDED IN THE NUMERATOR OF
THE RECEIPTS FRACTION. EIGHT PERCENT OF THE NET  GAINS  (NOT  LESS  THAN
ZERO)  FROM  (A)  SALES  OF  ASSET BACKED SECURITIES OR OTHER SECURITIES
ISSUED BY GOVERNMENT AGENCIES, INCLUDING BUT NOT LIMITED  TO  SECURITIES
ISSUED  BY  GNMA,  FNMA, FHLMC, OR THE SMALL BUSINESS ADMINISTRATION, OR
(B) SALES OF OTHER ASSET BACKED  SECURITIES  THAT  ARE  SOLD  THROUGH  A
REGISTERED  SECURITIES  BROKER OR DEALER OR THROUGH A LICENSED EXCHANGE,
SHALL BE INCLUDED IN THE NUMERATOR OF THE RECEIPTS FRACTION. THE  AMOUNT
OF NET GAINS (NOT LESS THAN ZERO) FROM SALES OF OTHER ASSET BACKED SECU-
RITIES NOT REFERENCED IN SUBCLAUSE (A) OR (B) OF THIS CLAUSE INCLUDED IN
THE  NUMERATOR OF THE RECEIPTS FRACTION SHALL BE DETERMINED BY MULTIPLY-
ING SUCH NET GAINS BY A FRACTION, THE NUMERATOR OF WHICH  SHALL  BE  THE
AMOUNT  OF  GROSS  PROCEEDS FROM SUCH SALES TO PURCHASERS LOCATED IN THE
CITY AND THE DENOMINATOR OF WHICH SHALL BE THE AMOUNT OF GROSS  PROCEEDS
FROM  SUCH  SALES  TO  PURCHASERS  LOCATED  WITHIN AND WITHOUT THE CITY.
RECEIPTS CONSTITUTING INTEREST INCOME FROM ASSET BACKED  SECURITIES  AND
OTHER  SECURITIES REFERENCED IN THIS CLAUSE AND NET GAINS (NOT LESS THAN
ZERO) FROM SALES OF ASSET BACKED SECURITIES AND OTHER SECURITIES  REFER-
ENCED  IN  THIS  CLAUSE  SHALL  BE  INCLUDED  IN  THE DENOMINATOR OF THE
RECEIPTS  FRACTION.  GROSS  PROCEEDS  SHALL  BE  DETERMINED  AFTER   THE
DEDUCTION  OF  ANY  COST TO ACQUIRE THE SECURITIES BUT SHALL NOT BE LESS
THAN ZERO.
  (IV) RECEIPTS CONSTITUTING INTEREST  FROM  CORPORATE  BONDS  SHALL  BE
INCLUDED  IN  THE  NUMERATOR  OF THE RECEIPTS FRACTION IF THE COMMERCIAL
DOMICILE OF THE ISSUING CORPORATION IS WITHIN THE CITY. EIGHT PERCENT OF
THE NET GAINS (NOT LESS THAN ZERO) FROM SALES OF  CORPORATE  BONDS  SOLD
THROUGH  A  REGISTERED SECURITIES BROKER OR DEALER OR THROUGH A LICENSED
EXCHANGE SHALL BE INCLUDED IN THE NUMERATOR OF  THE  RECEIPTS  FRACTION.
THE  AMOUNT OF NET GAINS (NOT LESS THAN ZERO) FROM OTHER SALES OF CORPO-
RATE BONDS INCLUDED IN THE NUMERATOR OF THE RECEIPTS FRACTION  SHALL  BE
DETERMINED BY MULTIPLYING SUCH NET GAINS BY A FRACTION, THE NUMERATOR OF
WHICH  IS  THE  AMOUNT  OF  GROSS PROCEEDS FROM SUCH SALES TO PURCHASERS
LOCATED WITHIN THE CITY AND THE DENOMINATOR OF WHICH IS  THE  AMOUNT  OF
GROSS  PROCEEDS  FROM SALES TO PURCHASERS LOCATED WITHIN AND WITHOUT THE

S. 4610--A                         59                         A. 6721--A

CITY. RECEIPTS CONSTITUTING INTEREST FROM CORPORATE BONDS,  WHETHER  THE
ISSUING CORPORATION'S COMMERCIAL DOMICILE IS WITHIN OR WITHOUT THE CITY,
AND  NET  GAINS  (NOT  LESS  THAN ZERO) FROM SALES OF CORPORATE BONDS TO
PURCHASERS  WITHIN AND WITHOUT THE CITY SHALL BE INCLUDED IN THE DENOMI-
NATOR OF THE RECEIPTS FRACTION. GROSS PROCEEDS SHALL BE DETERMINED AFTER
THE DEDUCTION OF ANY COST TO ACQUIRE THE BONDS BUT  SHALL  NOT  BE  LESS
THAN ZERO.
  (V)  EIGHT  PERCENT  OF  NET INTEREST INCOME (NOT LESS THAN ZERO) FROM
REVERSE REPURCHASE AGREEMENTS AND SECURITIES BORROWING AGREEMENTS  SHALL
BE  INCLUDED  IN  THE  NUMERATOR  OF THE RECEIPTS FRACTION. NET INTEREST
INCOME (NOT LESS THAN ZERO) FROM REVERSE REPURCHASE AGREEMENTS AND SECU-
RITIES BORROWING AGREEMENTS SHALL BE INCLUDED IN THE DENOMINATOR OF  THE
RECEIPTS  FRACTION.  NET  INTEREST INCOME FROM REVERSE REPURCHASE AGREE-
MENTS AND  SECURITIES  BORROWING  AGREEMENTS  SHALL  BE  DETERMINED  FOR
PURPOSES OF THIS SUBDIVISION AFTER THE DEDUCTION OF THE INTEREST EXPENSE
FROM  THE TAXPAYER'S REPURCHASE AGREEMENTS AND SECURITIES LENDING AGREE-
MENTS BUT SHALL NOT BE LESS THAN ZERO. FOR THIS CALCULATION, THE  AMOUNT
OF  SUCH  INTEREST EXPENSE SHALL BE THE INTEREST EXPENSE ASSOCIATED WITH
THE SUM OF THE VALUE OF THE TAXPAYER'S REPURCHASE AGREEMENTS WHERE IT IS
THE SELLER/BORROWER PLUS THE VALUE OF THE TAXPAYER'S SECURITIES  LENDING
AGREEMENTS  WHERE  IT  IS  THE  SECURITIES  LENDER, PROVIDED SUCH SUM IS
LIMITED TO THE SUM OF THE VALUE OF  THE  TAXPAYER'S  REVERSE  REPURCHASE
AGREEMENTS  WHERE  IT  IS  THE  PURCHASER/LENDER  PLUS  THE VALUE OF THE
TAXPAYER'S SECURITIES LENDING AGREEMENTS  WHERE  IT  IS  THE  SECURITIES
BORROWER.
  (VI)  EIGHT  PERCENT  OF  THE  NET  INTEREST (NOT LESS THAN ZERO) FROM
FEDERAL FUNDS SHALL BE INCLUDED IN THE NUMERATOR OF THE  RECEIPTS  FRAC-
TION.  THE NET INTEREST (NOT LESS THAN ZERO) FROM FEDERAL FUNDS SHALL BE
INCLUDED IN THE DENOMINATOR OF THE RECEIPTS FRACTION. NET INTEREST  FROM
FEDERAL  FUNDS  SHALL  BE DETERMINED AFTER DEDUCTION OF INTEREST EXPENSE
FROM FEDERAL FUNDS.
  (VII) DIVIDENDS FROM STOCK, NET GAINS (NOT LESS THAN ZERO) FROM  SALES
OF  STOCK  AND  NET GAINS (NOT LESS THAN ZERO) FROM SALES OF PARTNERSHIP
INTERESTS SHALL NOT BE INCLUDED IN EITHER THE NUMERATOR  OR  DENOMINATOR
OF  THE  RECEIPTS FRACTION UNLESS THE COMMISSIONER OF FINANCE DETERMINES
PURSUANT TO SUBDIVISION ELEVEN OF THIS SECTION THAT  INCLUSION  OF  SUCH
DIVIDENDS  AND  NET  GAINS (NOT LESS THAN ZERO) IS NECESSARY TO PROPERLY
REFLECT THE BUSINESS INCOME OR CAPITAL OF THE TAXPAYER.
  (VIII)(A) RECEIPTS CONSTITUTING INTEREST FROM OTHER FINANCIAL  INSTRU-
MENTS SHALL BE INCLUDED IN THE NUMERATOR OF THE RECEIPTS FRACTION IF THE
PAYOR  IS  LOCATED  WITHIN THE CITY. RECEIPTS CONSTITUTING INTEREST FROM
OTHER FINANCIAL INSTRUMENTS, WHETHER THE PAYOR IS WITHIN OR WITHOUT  THE
CITY, SHALL BE INCLUDED IN THE DENOMINATOR OF THE RECEIPTS FRACTION.
  (B)  NET  GAINS  (NOT  LESS  THAN  ZERO) FROM SALES OF OTHER FINANCIAL
INSTRUMENTS AND OTHER INCOME (NOT LESS THAN ZERO) FROM  OTHER  FINANCIAL
INSTRUMENTS  WHERE  THE  PURCHASER  OR  PAYOR IS LOCATED WITHIN THE CITY
SHALL BE INCLUDED IN THE NUMERATOR OF THE  RECEIPTS  FRACTION,  PROVIDED
THAT,  IF  THE  PURCHASER  OR PAYOR IS A REGISTERED SECURITIES BROKER OR
DEALER OR THE TRANSACTION IS MADE  THROUGH  A  LICENSED  EXCHANGE,  THEN
EIGHT PERCENT OF THE NET GAINS (NOT LESS THAN ZERO) OR OTHER INCOME (NOT
LESS THAN ZERO) SHALL BE INCLUDED IN THE NUMERATOR OF THE RECEIPTS FRAC-
TION.  NET  GAINS  (NOT  LESS  THAN  ZERO) FROM SALES OF OTHER FINANCIAL
INSTRUMENTS AND OTHER INCOME (NOT LESS THAN ZERO) FROM  OTHER  FINANCIAL
INSTRUMENTS  SHALL  BE INCLUDED IN THE DENOMINATOR OF THE RECEIPTS FRAC-
TION.

S. 4610--A                         60                         A. 6721--A

  (IX) NET INCOME (NOT LESS THAN ZERO) FROM SALES  OF  PHYSICAL  COMMOD-
ITIES  SHALL  BE  INCLUDED  IN THE NUMERATOR OF THE RECEIPTS FRACTION AS
PROVIDED IN THIS CLAUSE.  THE AMOUNT OF NET INCOME FROM SALES  OF  PHYS-
ICAL  COMMODITIES  INCLUDED  IN  THE  NUMERATOR OF THE RECEIPTS FRACTION
SHALL BE DETERMINED BY MULTIPLYING THE NET INCOME FROM SALES OF PHYSICAL
COMMODITIES BY A FRACTION, THE NUMERATOR OF WHICH SHALL BE THE AMOUNT OF
RECEIPTS FROM SALES OF PHYSICAL COMMODITIES ACTUALLY DELIVERED TO POINTS
WITHIN  THE  CITY  OR,  IF  THERE  IS NO ACTUAL DELIVERY OF THE PHYSICAL
COMMODITY, SOLD TO PURCHASERS LOCATED WITHIN THE CITY, AND THE DENOMINA-
TOR OF WHICH SHALL BE THE AMOUNT OF  RECEIPTS  FROM  SALES  OF  PHYSICAL
COMMODITIES ACTUALLY DELIVERED TO POINTS WITHIN AND WITHOUT THE CITY OR,
IF  THERE  IS  NO  ACTUAL  DELIVERY  OF  THE PHYSICAL COMMODITY, SOLD TO
PURCHASERS LOCATED WITHIN AND WITHOUT THE CITY.  NET  INCOME  (NOT  LESS
THAN  ZERO)  FROM SALES OF PHYSICAL COMMODITIES SHALL BE INCLUDED IN THE
DENOMINATOR OF THE RECEIPTS FRACTION. NET INCOME (NOT  LESS  THAN  ZERO)
FROM  SALES  OF  PHYSICAL  COMMODITIES  SHALL  BE  DETERMINED  AFTER THE
DEDUCTION OF THE COST TO ACQUIRE OR PRODUCE THE PHYSICAL COMMODITIES.
  (X)(A) FOR PURPOSES OF THIS SUBDIVISION, "MARKED TO MARKET" MEANS THAT
A FINANCIAL INSTRUMENT IS, UNDER SECTION FOUR  HUNDRED  SEVENTY-FIVE  OR
SECTION  TWELVE  HUNDRED FIFTY-SIX OF THE INTERNAL REVENUE CODE, TREATED
BY THE TAXPAYER AS SOLD FOR ITS FAIR MARKET VALUE ON THE  LAST  BUSINESS
DAY  OF  THE  TAXPAYER'S TAXABLE YEAR.   "MARKED TO MARKET GAIN OR LOSS"
MEANS THE GAIN OR LOSS RECOGNIZED BY THE  TAXPAYER  UNDER  SECTION  FOUR
HUNDRED SEVENTY-FIVE OR SECTION TWELVE HUNDRED FIFTY-SIX OF THE INTERNAL
REVENUE CODE BECAUSE THE FINANCIAL INSTRUMENT IS TREATED AS SOLD FOR ITS
FAIR  MARKET  VALUE  ON  THE LAST BUSINESS DAY OF THE TAXPAYER'S TAXABLE
YEAR.
  (B) THE AMOUNT OF MARKED TO MARKET NET GAINS (NOT LESS THAN ZERO) FROM
EACH TYPE OF FINANCIAL INSTRUMENT THAT IS MARKED TO MARKET  INCLUDED  IN
THE  NUMERATOR OF THE RECEIPTS FRACTION SHALL BE DETERMINED BY MULTIPLY-
ING THE MARKED TO MARKET NET GAINS (NOT LESS THAN ZERO) FROM  SUCH  TYPE
OF  FINANCIAL  INSTRUMENT BY A FRACTION, THE NUMERATOR OF WHICH SHALL BE
THE NUMERATOR OF THE RECEIPTS FRACTION FOR NET GAINS FROM THAT  TYPE  OF
FINANCIAL  INSTRUMENT  DETERMINED  UNDER  THE  APPLICABLE CLAUSE OF THIS
SUBPARAGRAPH AND THE DENOMINATOR OF WHICH SHALL BE  THE  DENOMINATOR  OF
THE  RECEIPTS FRACTION FOR NET GAINS FROM THAT TYPE OF FINANCIAL INSTRU-
MENT DETERMINED UNDER THE APPLICABLE CLAUSE OF THIS SUBPARAGRAPH. MARKED
TO MARKET NET GAINS (NOT LESS THAN ZERO) FROM FINANCIAL INSTRUMENTS  FOR
WHICH THE NUMERATOR OF THE RECEIPTS FRACTION FOR NET GAINS IS DETERMINED
UNDER THE IMMEDIATELY PRECEDING SENTENCE SHALL BE INCLUDED IN THE DENOM-
INATOR OF THE RECEIPTS FRACTION.
  (C)  IF  THE  TYPE OF FINANCIAL INSTRUMENT THAT IS MARKED TO MARKET IS
NOT OTHERWISE SOURCED BY THE TAXPAYER UNDER THIS SUBPARAGRAPH, OR IF THE
TAXPAYER HAS A NET LOSS FROM THE SALES OF THAT TYPE OF FINANCIAL INSTRU-
MENT UNDER THE APPLICABLE CLAUSE OF THIS  SUBPARAGRAPH,  THE  AMOUNT  OF
MARKED TO MARKET NET GAINS (NOT LESS THAN ZERO) FROM THAT TYPE OF FINAN-
CIAL INSTRUMENT INCLUDED IN THE NUMERATOR OF THE RECEIPTS FRACTION SHALL
BE  DETERMINED  BY  MULTIPLYING  THE MARKED TO MARKET NET GAINS (BUT NOT
LESS THAN ZERO) FROM THAT TYPE OF FINANCIAL INSTRUMENT  BY  A  FRACTION,
THE  NUMERATOR  OF  WHICH  SHALL  BE  THE  SUM OF THE AMOUNT OF RECEIPTS
INCLUDED IN THE NUMERATOR OF THE RECEIPTS  FRACTION  UNDER  CLAUSES  (I)
THROUGH  (IX) OF THIS SUBPARAGRAPH AND SUBCLAUSE (B) OF THIS CLAUSE, AND
THE DENOMINATOR OF WHICH SHALL BE THE SUM  OF  THE  AMOUNT  OF  RECEIPTS
INCLUDED  IN  THE DENOMINATOR OF THE RECEIPTS FRACTION UNDER CLAUSES (I)
THROUGH (IX) OF THIS SUBPARAGRAPH AND  SUBCLAUSE  (B)  OF  THIS  CLAUSE.
MARKED  TO MARKET NET GAINS (NOT LESS THAN ZERO) FOR WHICH THE AMOUNT TO

S. 4610--A                         61                         A. 6721--A

BE INCLUDED IN THE NUMERATOR OF  THE  RECEIPTS  FRACTION  IS  DETERMINED
UNDER THE IMMEDIATELY PRECEDING SENTENCE SHALL BE INCLUDED IN THE DENOM-
INATOR OF THE RECEIPTS FRACTION.
  (B)  RECEIPTS OF A REGISTERED SECURITIES BROKER OR DEALER FROM SECURI-
TIES OR COMMODITIES BROKER OR DEALER ACTIVITIES DESCRIBED IN THIS  PARA-
GRAPH  SHALL  BE  DEEMED TO BE GENERATED WITHIN THE CITY AS DESCRIBED IN
SUBPARAGRAPHS ONE THROUGH EIGHT OF THIS PARAGRAPH.  RECEIPTS  FROM  SUCH
ACTIVITIES  GENERATED WITHIN THE CITY SHALL BE INCLUDED IN THE NUMERATOR
OF THE RECEIPTS FRACTION. RECEIPTS FROM SUCH ACTIVITIES GENERATED WITHIN
AND WITHOUT THE CITY  SHALL  BE  INCLUDED  IN  THE  DENOMINATOR  OF  THE
RECEIPTS FRACTION. FOR THE PURPOSES OF THIS PARAGRAPH, THE TERM "SECURI-
TIES"  SHALL HAVE THE SAME MEANING AS IN PARAGRAPH TWO OF SUBSECTION (C)
OF SECTION FOUR HUNDRED SEVENTY-FIVE OF THE INTERNAL  REVENUE  CODE  AND
THE  TERM  "COMMODITIES" SHALL HAVE THE SAME MEANING AS IN PARAGRAPH TWO
OF SUBSECTION (E) OF SECTION FOUR HUNDRED SEVENTY-FIVE OF  THE  INTERNAL
REVENUE CODE.
  (1)  RECEIPTS  CONSTITUTING  BROKERAGE  COMMISSIONS  DERIVED  FROM THE
EXECUTION OF SECURITIES OR COMMODITIES PURCHASE OR SALES ORDERS FOR  THE
ACCOUNTS OF CUSTOMERS SHALL BE DEEMED TO BE GENERATED WITHIN THE CITY IF
THE  MAILING  ADDRESS IN THE RECORDS OF THE TAXPAYER OF THE CUSTOMER WHO
IS RESPONSIBLE FOR PAYING SUCH COMMISSIONS IS WITHIN THE CITY.
  (2) RECEIPTS CONSTITUTING MARGIN INTEREST EARNED ON BEHALF OF  BROKER-
AGE  ACCOUNTS  SHALL  BE  DEEMED  TO BE GENERATED WITHIN THE CITY IF THE
MAILING ADDRESS IN THE RECORDS OF THE TAXPAYER OF THE  CUSTOMER  WHO  IS
RESPONSIBLE FOR PAYING SUCH MARGIN INTEREST IS WITHIN THE CITY.
  (3) (I) RECEIPTS CONSTITUTING FEES EARNED BY THE TAXPAYER FOR ADVISORY
SERVICES TO A CUSTOMER IN CONNECTION WITH THE UNDERWRITING OF SECURITIES
FOR  SUCH CUSTOMER (SUCH CUSTOMER BEING THE ENTITY THAT IS CONTEMPLATING
ISSUING OR IS ISSUING SECURITIES) OR FEES EARNED  BY  THE  TAXPAYER  FOR
MANAGING AN UNDERWRITING SHALL BE DEEMED TO BE GENERATED WITHIN THE CITY
IF  THE  MAILING ADDRESS IN THE RECORDS OF THE TAXPAYER OF SUCH CUSTOMER
WHO IS RESPONSIBLE FOR PAYING SUCH FEES IS WITHIN THE CITY.
  (II) RECEIPTS CONSTITUTING THE PRIMARY SPREAD  OF  SELLING  CONCESSION
FROM  UNDERWRITTEN SECURITIES SHALL BE DEEMED TO BE GENERATED WITHIN THE
CITY IF THE CUSTOMER IS LOCATED WITHIN THE CITY.
  (III) THE TERM "PRIMARY SPREAD" MEANS THE DIFFERENCE BETWEEN THE PRICE
PAID BY THE TAXPAYER TO THE ISSUER OF THE SECURITIES BEING MARKETED  AND
THE  PRICE RECEIVED FROM THE SUBSEQUENT SALE OF THE UNDERWRITTEN SECURI-
TIES AT THE INITIAL PUBLIC OFFERING PRICE, LESS ANY  SELLING  CONCESSION
AND ANY FEES PAID TO THE TAXPAYER FOR ADVISORY SERVICES OR ANY MANAGER'S
FEES,  IF  SUCH  FEES ARE NOT PAID BY THE CUSTOMER TO THE TAXPAYER SEPA-
RATELY. THE TERM "PUBLIC OFFERING PRICE" MEANS THE PRICE AGREED UPON  BY
THE TAXPAYER AND THE ISSUER AT WHICH THE SECURITIES ARE TO BE OFFERED TO
THE  PUBLIC.  THE TERM "SELLING CONCESSION" MEANS THE AMOUNT PAID TO THE
TAXPAYER FOR PARTICIPATING IN THE UNDERWRITING OF A SECURITY  WHERE  THE
TAXPAYER IS NOT THE LEAD UNDERWRITER.
  (4)  RECEIPTS CONSTITUTING ACCOUNT MAINTENANCE FEES SHALL BE DEEMED TO
BE GENERATED WITHIN THE CITY IF THE MAILING ADDRESS IN  THE  RECORDS  OF
THE  TAXPAYER OF THE CUSTOMER WHO IS RESPONSIBLE FOR PAYING SUCH ACCOUNT
MAINTENANCE FEES IS WITHIN THE CITY.
  (5) RECEIPTS CONSTITUTING FEES FOR MANAGEMENT  OR  ADVISORY  SERVICES,
INCLUDING  FEES  FOR ADVISORY SERVICES IN RELATION TO MERGER OR ACQUISI-
TION ACTIVITIES, BUT EXCLUDING FEES PAID FOR SERVICES DESCRIBED IN PARA-
GRAPH (D) OF THIS SUBDIVISION, SHALL BE DEEMED TO  BE  GENERATED  WITHIN
THE  CITY  IF  THE MAILING ADDRESS IN THE RECORDS OF THE TAXPAYER OF THE
CUSTOMER WHO IS RESPONSIBLE FOR PAYING SUCH FEES IS WITHIN THE CITY.

S. 4610--A                         62                         A. 6721--A

  (6) RECEIPTS CONSTITUTING INTEREST EARNED BY THE TAXPAYER ON LOANS AND
ADVANCES MADE BY THE TAXPAYER  TO  A  CORPORATION  AFFILIATED  WITH  THE
TAXPAYER  BUT  WITH  WHICH  THE TAXPAYER IS NOT PERMITTED OR REQUIRED TO
FILE A COMBINED REPORT PURSUANT TO SECTION 11-654.3 OF  THIS  SUBCHAPTER
SHALL  BE DEEMED TO ARISE FROM SERVICES PERFORMED AT THE PRINCIPAL PLACE
OF BUSINESS OF SUCH AFFILIATED CORPORATION.
  (7) IF THE TAXPAYER RECEIVES ANY OF THE RECEIPTS ENUMERATED IN SUBPAR-
AGRAPHS ONE THROUGH FOUR OF THIS PARAGRAPH AS A RESULT OF  A  SECURITIES
CORRESPONDENT  RELATIONSHIP  SUCH  TAXPAYER  HAS  WITH ANOTHER BROKER OR
DEALER WITH THE TAXPAYER ACTING IN THIS  RELATIONSHIP  AS  THE  CLEARING
FIRM,  SUCH  RECEIPTS SHALL BE DEEMED TO BE GENERATED WITHIN THE CITY TO
THE EXTENT SET FORTH IN EACH OF SUCH SUBPARAGRAPHS. THE AMOUNT  OF  SUCH
RECEIPTS SHALL EXCLUDE THE AMOUNT THE TAXPAYER IS REQUIRED TO PAY TO THE
CORRESPONDENT  FIRM FOR SUCH CORRESPONDENT RELATIONSHIP. IF THE TAXPAYER
RECEIVES ANY OF THE RECEIPTS ENUMERATED  IN  SUBPARAGRAPHS  ONE  THROUGH
FOUR  OF  THIS  PARAGRAPH  AS  A  RESULT  OF  A SECURITIES CORRESPONDENT
RELATIONSHIP SUCH TAXPAYER HAS WITH ANOTHER BROKER OR  DEALER  WITH  THE
TAXPAYER  ACTING  IN  THIS  RELATIONSHIP  AS  THE INTRODUCING FIRM, SUCH
RECEIPTS SHALL BE DEEMED TO BE GENERATED WITHIN THE CITY TO  THE  EXTENT
SET FORTH IN EACH OF SUCH SUBPARAGRAPHS.
  (8) IF, FOR THE PURPOSES OF SUBPARAGRAPH ONE, SUBPARAGRAPH TWO, CLAUSE
(I)  OF  SUBPARAGRAPH  THREE, SUBPARAGRAPH FOUR, OR SUBPARAGRAPH FIVE OF
THIS PARAGRAPH, THE TAXPAYER IS UNABLE FROM ITS RECORDS TO DETERMINE THE
MAILING ADDRESS OF THE CUSTOMER, EIGHT PERCENT OF THE RECEIPTS SHALL  BE
INCLUDED IN THE NUMERATOR OF THE RECEIPTS FRACTION.
  (C)  RECEIPTS  RELATING TO THE BANK, CREDIT, TRAVEL, AND ENTERTAINMENT
CARD ACTIVITIES DESCRIBED IN THIS PARAGRAPH SHALL BE DEEMED TO BE GENER-
ATED WITHIN THE CITY AS DESCRIBED IN SUBPARAGRAPHS ONE THROUGH  FOUR  OF
THIS PARAGRAPH.  RECEIPTS FROM SUCH ACTIVITIES GENERATED WITHIN THE CITY
SHALL  BE  INCLUDED  IN THE NUMERATOR OF THE RECEIPTS FRACTION. RECEIPTS
FROM SUCH ACTIVITIES GENERATED WITHIN AND  WITHOUT  THE  CITY  SHALL  BE
INCLUDED IN THE DENOMINATOR OF THE RECEIPTS FRACTION.
  (1)  RECEIPTS  CONSTITUTING  INTEREST,  AND  FEES AND PENALTIES IN THE
NATURE OF INTEREST, FROM BANK, CREDIT,  TRAVEL  AND  ENTERTAINMENT  CARD
RECEIVABLES SHALL BE DEEMED TO BE GENERATED WITHIN THE CITY IF THE MAIL-
ING  ADDRESS OF THE CARD HOLDER IN THE RECORDS OF THE TAXPAYER IS WITHIN
THE CITY;
  (2) RECEIPTS FROM SERVICE CHARGES AND FEES FROM SUCH  CARDS  SHALL  BE
DEEMED  TO  BE  GENERATED  WITHIN THE CITY IF THE MAILING ADDRESS OF THE
CARD HOLDER IN THE RECORDS OF THE TAXPAYER IS WITHIN THE CITY;
  (3) RECEIPTS FROM MERCHANT DISCOUNTS SHALL BE DEEMED TO  BE  GENERATED
WITHIN  THE CITY IF THE MERCHANT IS LOCATED WITHIN THE CITY. IN THE CASE
OF A MERCHANT WITH LOCATIONS BOTH WITHIN  AND  WITHOUT  THE  CITY,  ONLY
RECEIPTS  FROM  MERCHANT  DISCOUNTS  ATTRIBUTABLE  TO  SALES  MADE  FROM
LOCATIONS WITHIN THE CITY  ARE  ALLOCATED  TO  THE  CITY.  IT  SHALL  BE
PRESUMED  THAT  THE  LOCATION  OF  THE  MERCHANT  IS  THE ADDRESS OF THE
MERCHANT SHOWN ON THE INVOICE SUBMITTED BY THE MERCHANT TO THE TAXPAYER;
AND
  (4) RECEIPTS FROM CREDIT CARD AUTHORIZATION PROCESSING,  AND  CLEARING
AND  SETTLEMENT  PROCESSING RECEIVED BY A CREDIT CARD PROCESSOR SHALL BE
DEEMED TO BE GENERATED WITHIN THE CITY IF THE LOCATION WHERE THE  CREDIT
CARD  PROCESSOR'S  CUSTOMER ACCESSES THE CREDIT CARD PROCESSOR'S NETWORK
IS LOCATED WITHIN THE CITY. THE AMOUNT OF ALL OTHER RECEIPTS RECEIVED BY
A CREDIT CARD PROCESSOR NOT SPECIFICALLY ADDRESSED IN  SUBDIVISIONS  ONE
THROUGH  NINE  OR SUBDIVISION TWELVE OF THIS SECTION DEEMED TO BE GENER-
ATED WITHIN THE CITY SHALL BE DETERMINED BY MULTIPLYING THE TOTAL AMOUNT

S. 4610--A                         63                         A. 6721--A

OF SUCH OTHER RECEIPTS BY THE AVERAGE OF (I) EIGHT PERCENT AND (II)  THE
PERCENT  OF  NEW  YORK  CITY ACCESS POINTS. THE PERCENT OF NEW YORK CITY
ACCESS POINTS SHALL BE THE NUMBER OF LOCATIONS IN  NEW  YORK  CITY  FROM
WHICH  THE  CREDIT  CARD  PROCESSOR'S  CUSTOMERS  ACCESS THE CREDIT CARD
PROCESSOR'S NETWORK DIVIDED BY THE TOTAL  NUMBER  OF  LOCATIONS  IN  THE
UNITED  STATES  WHERE  THE  CREDIT CARD PROCESSOR'S CUSTOMERS ACCESS THE
CREDIT CARD PROCESSOR'S NETWORK.
  (D) RECEIPTS RECEIVED FROM AN INVESTMENT COMPANY ARISING FROM THE SALE
OF MANAGEMENT, ADMINISTRATION OR DISTRIBUTION SERVICES TO  SUCH  INVEST-
MENT  COMPANY SHALL BE INCLUDED IN THE DENOMINATOR OF THE RECEIPTS FRAC-
TION. THE PORTION OF SUCH RECEIPTS INCLUDED  IN  THE  NUMERATOR  OF  THE
RECEIPTS  FRACTION (SUCH PORTION REFERRED TO HEREIN AS THE NEW YORK CITY
PORTION) SHALL BE DETERMINED AS PROVIDED IN THIS PARAGRAPH.
  (1) THE NEW YORK CITY PORTION SHALL BE THE PRODUCT  OF  THE  TOTAL  OF
SUCH RECEIPTS FROM THE SALE OF SUCH SERVICES AND A FRACTION. THE NUMERA-
TOR  OF  THAT  FRACTION  SHALL BE THE SUM OF THE MONTHLY PERCENTAGES (AS
DEFINED HEREINAFTER) DETERMINED FOR EACH MONTH OF THE INVESTMENT  COMPA-
NY'S  TAXABLE  YEAR  FOR  FEDERAL INCOME TAX PURPOSES WHICH TAXABLE YEAR
ENDS WITHIN THE TAXABLE YEAR OF THE TAXPAYER (BUT  EXCLUDING  ANY  MONTH
DURING  WHICH  THE  INVESTMENT  COMPANY  HAD NO OUTSTANDING SHARES). THE
MONTHLY PERCENTAGE FOR EACH SUCH MONTH SHALL BE DETERMINED  BY  DIVIDING
THE  NUMBER  OF  SHARES  IN THE INVESTMENT COMPANY THAT ARE OWNED ON THE
LAST DAY OF THE MONTH BY SHAREHOLDERS THAT ARE LOCATED IN  THE  CITY  BY
THE TOTAL NUMBER OF SHARES IN THE INVESTMENT COMPANY OUTSTANDING ON THAT
DATE. THE DENOMINATOR OF THE FRACTION SHALL BE THE NUMBER OF SUCH MONTH-
LY PERCENTAGES.
  (2)(I)  FOR PURPOSES OF THIS PARAGRAPH, AN INDIVIDUAL, ESTATE OR TRUST
SHALL BE DEEMED TO BE LOCATED WITHIN THE CITY IF HIS, HER OR ITS MAILING
ADDRESS IN THE RECORDS OF THE INVESTMENT COMPANY IS LOCATED  WITHIN  THE
CITY.  A  BUSINESS ENTITY IS DEEMED TO BE LOCATED WITHIN THE CITY IF ITS
COMMERCIAL DOMICILE IS LOCATED WITHIN THE CITY.
  (II) FOR PURPOSES OF THIS PARAGRAPH,  THE  TERM  "INVESTMENT  COMPANY"
MEANS  A  REGULATED  INVESTMENT  COMPANY,  AS  DEFINED  IN SECTION EIGHT
HUNDRED FIFTY-ONE OF THE INTERNAL REVENUE CODE,  AND  A  PARTNERSHIP  TO
WHICH SUBSECTION (A) OF SECTION SEVEN THOUSAND SEVEN HUNDRED FOUR OF THE
INTERNAL   REVENUE  CODE  APPLIES  (BY  VIRTUE  OF  PARAGRAPH  THREE  OF
SUBSECTION (C) OF SECTION SEVEN THOUSAND  SEVEN  HUNDRED  FOUR  OF  SUCH
CODE) AND THAT MEETS THE REQUIREMENTS OF SUBSECTION (B) OF SECTION EIGHT
HUNDRED  FIFTY-ONE OF SUCH CODE. THE PRECEDING SENTENCE SHALL BE APPLIED
TO THE TAXABLE YEAR FOR FEDERAL INCOME  TAX  PURPOSES  OF  THE  BUSINESS
ENTITY  THAT  IS  ASSERTED TO CONSTITUTE AN INVESTMENT COMPANY THAT ENDS
WITHIN THE TAXABLE YEAR OF THE TAXPAYER.
  (III) FOR PURPOSES OF THIS PARAGRAPH, THE TERM "RECEIPTS RECEIVED FROM
AN INVESTMENT  COMPANY"  INCLUDES  AMOUNTS  RECEIVED  DIRECTLY  FROM  AN
INVESTMENT  COMPANY AS WELL AS AMOUNTS RECEIVED FROM THE SHAREHOLDERS IN
SUCH INVESTMENT COMPANY, IN THEIR CAPACITY AS SUCH.
  (IV) FOR PURPOSES OF THIS PARAGRAPH, THE  TERM  "MANAGEMENT  SERVICES"
MEANS  THE  RENDERING  OF  INVESTMENT  ADVICE  TO AN INVESTMENT COMPANY,
MAKING DETERMINATIONS AS TO WHEN SALES AND PURCHASES OF  SECURITIES  ARE
TO  BE  MADE  ON  BEHALF  OF  AN  INVESTMENT  COMPANY, OR THE SELLING OR
PURCHASING OF SECURITIES CONSTITUTING ASSETS OF AN  INVESTMENT  COMPANY,
AND  RELATED  ACTIVITIES, BUT ONLY WHERE SUCH ACTIVITY OR ACTIVITIES ARE
PERFORMED PURSUANT TO A CONTRACT WITH  THE  INVESTMENT  COMPANY  ENTERED
INTO  PURSUANT  TO  SUBSECTION  (A)  OF  SECTION  FIFTEEN OF THE FEDERAL
INVESTMENT COMPANY ACT OF NINETEEN HUNDRED FORTY, AS AMENDED.

S. 4610--A                         64                         A. 6721--A

  (V) FOR PURPOSES OF THIS PARAGRAPH, THE TERM  "DISTRIBUTION  SERVICES"
MEANS  THE SERVICES OF ADVERTISING, SERVICING INVESTOR ACCOUNTS (INCLUD-
ING REDEMPTIONS), MARKETING SHARES OR SELLING SHARES  OF  AN  INVESTMENT
COMPANY,  BUT,  IN  THE CASE OF ADVERTISING, SERVICING INVESTOR ACCOUNTS
(INCLUDING  REDEMPTIONS) OR MARKETING SHARES, ONLY WHERE SUCH SERVICE IS
PERFORMED BY A PERSON WHO IS (OR WAS, IN THE CASE OF A CLOSED END COMPA-
NY) ALSO ENGAGED IN THE SERVICE OF SELLING SUCH SHARES. IN THE  CASE  OF
AN  OPEN  END  COMPANY, SUCH SERVICE OF SELLING SHARES MUST BE PERFORMED
PURSUANT TO A CONTRACT  ENTERED  INTO  PURSUANT  TO  SUBSECTION  (B)  OF
SECTION  FIFTEEN  OF  THE  FEDERAL  INVESTMENT  COMPANY  ACT OF NINETEEN
HUNDRED FORTY, AS AMENDED.
  (VI)  FOR  PURPOSES  OF  THIS  PARAGRAPH,  THE  TERM   "ADMINISTRATION
SERVICES"  INCLUDES  CLERICAL, ACCOUNTING, BOOKKEEPING, DATA PROCESSING,
INTERNAL AUDITING, LEGAL AND TAX SERVICES PERFORMED  FOR  AN  INVESTMENT
COMPANY  BUT ONLY IF THE PROVIDER OF SUCH SERVICE OR SERVICES DURING THE
TAXABLE YEAR IN WHICH SUCH SERVICE  OR  SERVICES  ARE  SOLD  ALSO  SELLS
MANAGEMENT  OR  DISTRIBUTION  SERVICES,  AS DEFINED HEREINABOVE, TO SUCH
INVESTMENT COMPANY.
  (E) FOR PURPOSES OF THIS SUBDIVISION, A TAXPAYER SHALL USE THE FOLLOW-
ING HIERARCHY TO DETERMINE THE COMMERCIAL DOMICILE OF A BUSINESS ENTITY,
BASED ON THE INFORMATION KNOWN TO THE TAXPAYER OR INFORMATION THAT WOULD
BE KNOWN UPON REASONABLE INQUIRY: (1) THE SEAT OF MANAGEMENT AND CONTROL
OF THE BUSINESS ENTITY; AND (2) THE  BILLING  ADDRESS  OF  THE  BUSINESS
ENTITY  IN  THE TAXPAYER'S RECORDS. THE TAXPAYER MUST EXERCISE DUE DILI-
GENCE BEFORE REJECTING THE FIRST METHOD IN THIS HIERARCHY AND PROCEEDING
TO THE NEXT METHOD.
  (F) FOR PURPOSES OF THIS SUBDIVISION, THE TERM "REGISTERED  SECURITIES
BROKER  OR  DEALER"  MEANS  A BROKER OR DEALER REGISTERED AS SUCH BY THE
SECURITIES AND EXCHANGE COMMISSION OR A BROKER OR DEALER  REGISTERED  AS
SUCH BY THE COMMODITIES FUTURES TRADING COMMISSION, AND SHALL INCLUDE AN
OTC  DERIVATIVES  DEALER  AS DEFINED UNDER REGULATIONS OF THE SECURITIES
AND EXCHANGE COMMISSION AT TITLE 17, PART 240, SECTION 3B-12 OF THE CODE
OF FEDERAL REGULATIONS (17 CFR 240.3B-12).
  6. RECEIPTS FROM THE CONDUCT OF A RAILROAD BUSINESS (INCLUDING SURFACE
RAILROAD, WHETHER OR NOT OPERATED BY STEAM,  SUBWAY  RAILROAD,  ELEVATED
RAILROAD,  PALACE  CAR  OR SLEEPING CAR BUSINESS) OR A TRUCKING BUSINESS
SHALL BE INCLUDED IN THE NUMERATOR OF THE RECEIPTS FRACTION AS  FOLLOWS.
THE  AMOUNT  OF  RECEIPTS  FROM  THE CONDUCT OF A RAILROAD BUSINESS OR A
TRUCKING BUSINESS INCLUDED IN THE NUMERATOR  OF  THE  RECEIPTS  FRACTION
SHALL  BE  DETERMINED  BY  MULTIPLYING  THE AMOUNT OF RECEIPTS FROM SUCH
BUSINESS BY A FRACTION, THE NUMERATOR OF WHICH SHALL  BE  THE  MILES  IN
SUCH  BUSINESS  WITHIN THE CITY DURING THE PERIOD COVERED BY THE TAXPAY-
ER'S REPORT AND THE DENOMINATOR OF WHICH SHALL  BE  THE  MILES  IN  SUCH
BUSINESS  WITHIN  AND WITHOUT THE CITY DURING SUCH PERIOD. RECEIPTS FROM
THE CONDUCT OF THE RAILROAD BUSINESS OR A  TRUCKING  BUSINESS  SHALL  BE
INCLUDED IN THE DENOMINATOR OF THE RECEIPTS FRACTION.
  7. (A) RECEIPTS OF A TAXPAYER ACTING AS PRINCIPAL FROM THE ACTIVITY OF
AIR  FREIGHT  FORWARDING  AND LIKE INDIRECT AIR CARRIER RECEIPTS ARISING
FROM SUCH ACTIVITY SHALL BE INCLUDED IN THE NUMERATOR  OF  THE  RECEIPTS
FRACTION  AS  FOLLOWS:  ONE HUNDRED PERCENT OF SUCH RECEIPTS IF BOTH THE
PICKUP AND DELIVERY ASSOCIATED WITH SUCH RECEIPTS ARE  MADE  WITHIN  THE
CITY AND FIFTY PERCENT OF SUCH RECEIPTS IF EITHER THE PICKUP OR DELIVERY
ASSOCIATED  WITH  SUCH RECEIPTS IS MADE WITHIN THIS CITY. SUCH RECEIPTS,
WHETHER THE PICKUP OR DELIVERY ASSOCIATED WITH THE RECEIPTS IS WITHIN OR
WITHOUT THE CITY, SHALL BE INCLUDED IN THE DENOMINATOR OF  THE  RECEIPTS
FRACTION.

S. 4610--A                         65                         A. 6721--A

  (B)(1)(I) THE PORTION OF RECEIPTS OF A TAXPAYER FROM AVIATION SERVICES
(OTHER THAN SERVICES DESCRIBED IN PARAGRAPH (A) OF THIS SUBDIVISION, BUT
INCLUDING  THE  RECEIPTS  OF  A  QUALIFIED  AIR FREIGHT FORWARDER) TO BE
INCLUDED IN THE NUMERATOR OF THE RECEIPTS FRACTION SHALL  BE  DETERMINED
BY  MULTIPLYING ITS RECEIPTS FROM SUCH AVIATION SERVICES BY A PERCENTAGE
WHICH IS EQUAL TO THE ARITHMETIC AVERAGE OF THE FOLLOWING THREE PERCENT-
AGES:
  (A) THE PERCENTAGE DETERMINED BY DIVIDING THE  AIRCRAFT  ARRIVALS  AND
DEPARTURES  WITHIN THE CITY BY THE TAXPAYER DURING THE PERIOD COVERED BY
ITS REPORT BY THE TOTAL AIRCRAFT  ARRIVALS  AND  DEPARTURES  WITHIN  AND
WITHOUT  THE  CITY  DURING  SUCH PERIOD; PROVIDED, HOWEVER, ARRIVALS AND
DEPARTURES SOLELY FOR MAINTENANCE OR REPAIR, REFUELING (WHERE NO  DEBAR-
KATION  OR  EMBARKATION  OF  TRAFFIC OCCURS), ARRIVALS AND DEPARTURES OF
FERRY AND PERSONNEL TRAINING FLIGHTS OR ARRIVALS AND DEPARTURES  IN  THE
EVENT  OF  EMERGENCY  SITUATIONS SHALL NOT BE INCLUDED IN COMPUTING SUCH
ARRIVAL AND DEPARTURE PERCENTAGE; PROVIDED, FURTHER, THE COMMISSIONER OF
FINANCE MAY ALSO EXEMPT  FROM  SUCH  PERCENTAGE  AIRCRAFT  ARRIVALS  AND
DEPARTURES  OF  ALL  NON-REVENUE FLIGHTS INCLUDING FLIGHTS INVOLVING THE
TRANSPORTATION OF OFFICERS OR EMPLOYEES RECEIVING AIR TRANSPORTATION  TO
PERFORM MAINTENANCE OR REPAIR SERVICES OR WHERE SUCH OFFICERS OR EMPLOY-
EES  ARE  TRANSPORTED  IN CONJUNCTION WITH AN EMERGENCY SITUATION OR THE
INVESTIGATION OF AN AIR DISASTER (OTHER THAN  ON  A  SCHEDULED  FLIGHT);
PROVIDED,  HOWEVER, THAT ARRIVALS AND DEPARTURES OF FLIGHTS TRANSPORTING
OFFICERS AND EMPLOYEES RECEIVING AIR TRANSPORTATION FOR  PURPOSES  OTHER
THAN  SPECIFIED ABOVE (WITHOUT REGARD TO REMUNERATION) SHALL BE INCLUDED
IN COMPUTING SUCH ARRIVAL AND DEPARTURE PERCENTAGE;
  (B) THE PERCENTAGE DETERMINED BY DIVIDING THE REVENUE TONS HANDLED  BY
THE TAXPAYER AT AIRPORTS WITHIN THE CITY DURING SUCH PERIOD BY THE TOTAL
REVENUE  TONS  HANDLED  BY  IT  AT  AIRPORTS WITHIN AND WITHOUT THE CITY
DURING SUCH PERIOD; AND
  (C) THE PERCENTAGE DETERMINED BY DIVIDING THE  TAXPAYER'S  ORIGINATING
REVENUE WITHIN THE CITY FOR SUCH PERIOD BY ITS TOTAL ORIGINATING REVENUE
WITHIN AND WITHOUT THE CITY FOR SUCH PERIOD.
  (II)  AS USED HEREIN THE TERM "AIRCRAFT ARRIVALS AND DEPARTURES" MEANS
THE NUMBER OF LANDINGS AND TAKEOFFS OF THE AIRCRAFT OF THE TAXPAYER  AND
THE NUMBER OF AIR PICKUPS AND DELIVERIES BY THE AIRCRAFT OF SUCH TAXPAY-
ER;  THE  TERM  "ORIGINATING REVENUE" MEANS REVENUE TO THE TAXPAYER FROM
THE TRANSPORTATION OF REVENUE  PASSENGERS  AND  REVENUE  PROPERTY  FIRST
RECEIVED  BY THE TAXPAYER EITHER AS ORIGINATING OR CONNECTING TRAFFIC AT
AIRPORTS; AND  THE  TERM  "REVENUE  TONS  HANDLED  BY  THE  TAXPAYER  AT
AIRPORTS" MEANS THE WEIGHT IN TONS OF REVENUE PASSENGERS (AT TWO HUNDRED
POUNDS  PER PASSENGER) AND REVENUE CARGO FIRST RECEIVED EITHER AS ORIGI-
NATING OR CONNECTING TRAFFIC OR FINALLY DISCHARGED BY  THE  TAXPAYER  AT
AIRPORTS.
  (2)  ALL  SUCH RECEIPTS OF A TAXPAYER FROM AVIATION SERVICES DESCRIBED
IN THIS PARAGRAPH SHALL BE INCLUDED IN THE DENOMINATOR OF  THE  RECEIPTS
FRACTION.
  (3) A CORPORATION IS A QUALIFIED AIR FREIGHT FORWARDER WITH RESPECT TO
ANOTHER CORPORATION:
  (I)  IF  IT  OWNS OR CONTROLS EITHER DIRECTLY OR INDIRECTLY ALL OF THE
CAPITAL STOCK OF SUCH OTHER CORPORATION, OR IF ALL OF ITS CAPITAL  STOCK
IS  OWNED  OR  CONTROLLED  EITHER  DIRECTLY  OR INDIRECTLY BY SUCH OTHER
CORPORATION, OR IF ALL OF THE CAPITAL  STOCK  OF  BOTH  CORPORATIONS  IS
OWNED OR CONTROLLED EITHER DIRECTLY OR INDIRECTLY BY THE SAME INTERESTS;
  (II)  IF  IT  IS  PRINCIPALLY  ENGAGED  IN THE BUSINESS OF AIR FREIGHT
FORWARDING; AND

S. 4610--A                         66                         A. 6721--A

  (III) IF ITS AIR FREIGHT FORWARDING BUSINESS IS CARRIED ON PRINCIPALLY
WITH THE AIRLINE OR AIRLINES OPERATED BY SUCH OTHER CORPORATION.
  8.  (A) THE AMOUNT OF RECEIPTS FROM SALES OF ADVERTISING IN NEWSPAPERS
OR PERIODICALS INCLUDED IN THE NUMERATOR OF THE RECEIPTS FRACTION  SHALL
BE  DETERMINED  BY MULTIPLYING THE TOTAL OF SUCH RECEIPTS BY A FRACTION,
THE NUMERATOR OF WHICH SHALL BE THE NUMBER OF NEWSPAPERS AND PERIODICALS
DELIVERED TO POINTS WITHIN THE CITY AND THE DENOMINATOR OF  WHICH  SHALL
BE  THE  NUMBER OF NEWSPAPERS AND PERIODICALS DELIVERED TO POINTS WITHIN
AND WITHOUT THE CITY. THE TOTAL OF SUCH RECEIPTS FROM SALES OF ADVERTIS-
ING IN NEWSPAPERS OR PERIODICALS SHALL BE INCLUDED IN THE DENOMINATOR OF
THE RECEIPTS FRACTION.
  (B) THE AMOUNT OF RECEIPTS FROM SALES OF ADVERTISING ON TELEVISION  OR
RADIO INCLUDED IN THE NUMERATOR OF THE RECEIPTS FRACTION SHALL BE DETER-
MINED  BY  MULTIPLYING  THE  TOTAL  OF  SUCH RECEIPTS BY A FRACTION, THE
NUMERATOR OF WHICH SHALL BE THE NUMBER OF VIEWERS  OR  LISTENERS  WITHIN
THE  CITY AND THE DENOMINATOR OF WHICH SHALL BE THE NUMBER OF VIEWERS OR
LISTENERS WITHIN AND WITHOUT THE CITY.  THE TOTAL OF SUCH RECEIPTS  FROM
SALES  OF  ADVERTISING  ON  TELEVISION OR RADIO SHALL BE INCLUDED IN THE
DENOMINATOR OF THE RECEIPTS FRACTION.
  (C) THE AMOUNT OF RECEIPTS FROM SALES OF ADVERTISING NOT DESCRIBED  IN
PARAGRAPH  (A) OR (B) OF THIS SUBDIVISION THAT IS FURNISHED, PROVIDED OR
DELIVERED TO, OR ACCESSED BY THE VIEWER OR LISTENER THROUGH THE  USE  OF
WIRE,  CABLE,  FIBER-OPTIC,  LASER,  MICROWAVE, RADIO WAVE, SATELLITE OR
SIMILAR SUCCESSOR MEDIA OR ANY  COMBINATION  THEREOF,  INCLUDED  IN  THE
NUMERATOR  OF  THE  RECEIPTS FRACTION SHALL BE DETERMINED BY MULTIPLYING
THE TOTAL OF SUCH RECEIPTS BY A FRACTION, THE NUMERATOR OF  WHICH  SHALL
BE  THE NUMBER OF VIEWERS OR LISTENERS WITHIN THE CITY AND THE DENOMINA-
TOR OF WHICH SHALL BE THE NUMBER OF  VIEWERS  OR  LISTENERS  WITHIN  AND
WITHOUT  THE  CITY. THE TOTAL OF SUCH RECEIPTS FROM SALES OF ADVERTISING
DESCRIBED IN THIS PARAGRAPH SHALL BE INCLUDED IN THE DENOMINATOR OF  THE
RECEIPTS FRACTION.
  9.  RECEIPTS  FROM  THE  TRANSPORTATION OR TRANSMISSION OF GAS THROUGH
PIPES SHALL BE INCLUDED IN THE NUMERATOR OF  THE  RECEIPTS  FRACTION  AS
FOLLOWS.  THE AMOUNT OF RECEIPTS FROM THE TRANSPORTATION OR TRANSMISSION
OF GAS THROUGH PIPES INCLUDED IN THE NUMERATOR OF THE RECEIPTS  FRACTION
SHALL  BE DETERMINED BY MULTIPLYING THE TOTAL AMOUNT OF SUCH RECEIPTS BY
A FRACTION, THE NUMERATOR OF WHICH SHALL BE THE  TAXPAYER'S  TRANSPORTA-
TION  UNITS  WITHIN  THE  CITY AND THE DENOMINATOR OF WHICH SHALL BE THE
TAXPAYER'S TRANSPORTATION UNITS WITHIN AND WITHOUT THE CITY. A TRANSPOR-
TATION UNIT IS THE TRANSPORTATION OF  ONE  CUBIC  FOOT  OF  GAS  OVER  A
DISTANCE OF ONE MILE.  THE TOTAL AMOUNT OF RECEIPTS FROM THE TRANSPORTA-
TION  OR  TRANSMISSION  OF  GAS  THROUGH  PIPES SHALL BE INCLUDED IN THE
DENOMINATOR OF THE RECEIPTS FRACTION.
  10. (A) RECEIPTS FROM  SERVICES  NOT  ADDRESSED  IN  SUBDIVISIONS  ONE
THROUGH  NINE  OR  SUBDIVISION TWELVE OF THIS SECTION AND OTHER BUSINESS
RECEIPTS NOT ADDRESSED IN SUCH SUBDIVISIONS SHALL  BE  INCLUDED  IN  THE
NUMERATOR  OF  THE  RECEIPTS FRACTION IF THE LOCATION OF THE CUSTOMER IS
WITHIN THE CITY. SUCH RECEIPTS FROM CUSTOMERS  WITHIN  AND  WITHOUT  THE
CITY  SHALL  BE  INCLUDED  IN  THE DENOMINATOR OF THE RECEIPTS FRACTION.
WHETHER THE RECEIPTS ARE INCLUDED IN THE NUMERATOR OF THE RECEIPTS FRAC-
TION SHALL BE DETERMINED ACCORDING TO THE HIERARCHY OF METHODS SET FORTH
IN PARAGRAPH (B) OF THIS SUBDIVISION.   THE TAXPAYER MUST  EXERCISE  DUE
DILIGENCE UNDER EACH METHOD DESCRIBED IN SUCH PARAGRAPH BEFORE REJECTING
IT AND PROCEEDING TO THE NEXT METHOD IN THE HIERARCHY, AND MUST BASE ITS
DETERMINATION  ON  INFORMATION KNOWN TO THE TAXPAYER OR INFORMATION THAT
WOULD BE KNOWN TO THE TAXPAYER UPON REASONABLE INQUIRY.

S. 4610--A                         67                         A. 6721--A

  (B) THE HIERARCHY OF METHODS IS  AS  FOLLOWS:    (1)  THE  BENEFIT  IS
RECEIVED  IN  THE CITY; (2) DELIVERY DESTINATION; (3) THE RECEIPTS FRAC-
TION FOR SUCH RECEIPTS WITHIN  THE  CITY  DETERMINED  PURSUANT  TO  THIS
SUBDIVISION FOR THE PRECEDING TAXABLE YEAR; OR (4) THE RECEIPTS FRACTION
IN  THE CURRENT TAXABLE YEAR DETERMINED PURSUANT TO THIS SUBDIVISION FOR
THOSE RECEIPTS THAT CAN BE SOURCED USING THE HIERARCHY OF SOURCING METH-
ODS IN SUBPARAGRAPHS ONE AND TWO OF THIS PARAGRAPH.
  11. IF IT SHALL APPEAR THAT THE RECEIPTS FRACTION DETERMINED  PURSUANT
TO THIS SECTION DOES NOT RESULT IN A PROPER REFLECTION OF THE TAXPAYER'S
BUSINESS  INCOME OR CAPITAL WITHIN THE CITY, THE COMMISSIONER OF FINANCE
IS AUTHORIZED IN HIS OR HER DISCRETION TO ADJUST IT, OR THE TAXPAYER MAY
REQUEST THAT THE COMMISSIONER OF FINANCE ADJUST IT, BY (A) EXCLUDING ONE
OR MORE ITEMS IN SUCH DETERMINATION, (B) INCLUDING  ONE  OR  MORE  OTHER
ITEMS IN SUCH DETERMINATION, OR (C) ANY OTHER SIMILAR OR DIFFERENT METH-
OD  CALCULATED  TO  EFFECT  A FAIR AND PROPER ALLOCATION OF THE BUSINESS
INCOME AND CAPITAL REASONABLY ATTRIBUTED TO THE CITY. THE PARTY  SEEKING
THE  ADJUSTMENT  SHALL  BEAR THE BURDEN OF PROOF TO DEMONSTRATE THAT THE
RECEIPTS FRACTION DETERMINED PURSUANT TO THIS SECTION DOES NOT RESULT IN
A PROPER REFLECTION OF THE TAXPAYER'S BUSINESS INCOME OR CAPITAL  WITHIN
THE CITY AND THAT THE PROPOSED ADJUSTMENT IS APPROPRIATE.
  12.  RECEIPTS  FROM  THE OPERATION OF VESSELS SHALL BE INCLUDED IN THE
NUMERATOR OF THE RECEIPTS FRACTION AS FOLLOWS. THE  AMOUNT  OF  RECEIPTS
FROM  THE OPERATION OF VESSELS INCLUDED IN THE NUMERATOR OF THE RECEIPTS
FRACTION SHALL BE DETERMINED BY MULTIPLYING THE AMOUNT OF SUCH  RECEIPTS
BY  A  FRACTION, THE NUMERATOR OF WHICH SHALL BE THE AGGREGATE NUMBER OF
WORKING DAYS OF THE VESSELS OWNED OR LEASED BY THE TAXPAYER IN  TERRITO-
RIAL  WATERS  OF  THE  CITY  DURING THE PERIOD COVERED BY THE TAXPAYER'S
REPORT AND THE DENOMINATOR OF WHICH SHALL BE  THE  AGGREGATE  NUMBER  OF
WORKING  DAYS OF ALL VESSELS OWNED OR LEASED BY THE TAXPAYER DURING SUCH
PERIOD. RECEIPTS FROM THE OPERATION OF VESSELS SHALL BE INCLUDED IN  THE
DENOMINATOR OF THE RECEIPTS FRACTION.
  S 11-654.3 COMBINED REPORTS. 1. (A) THE TAX ON A COMBINED REPORT SHALL
BE THE HIGHEST OF (1) THE COMBINED BUSINESS INCOME MULTIPLIED BY THE TAX
RATE  SPECIFIED  IN  CLAUSE  (I) OF SUBPARAGRAPH ONE OF PARAGRAPH (E) OF
SUBDIVISION ONE OF SECTION 11-654 OF THIS SUBCHAPTER; (2)  THE  COMBINED
CAPITAL  MULTIPLIED BY THE TAX RATE SPECIFIED IN CLAUSE (II) OF SUBPARA-
GRAPH ONE OF PARAGRAPH (E) OF SUBDIVISION ONE OF SECTION 11-654 OF  THIS
SUBCHAPTER, BUT NOT EXCEEDING THE LIMITATION PROVIDED FOR IN SUCH CLAUSE
(II); OR (3) THE FIXED DOLLAR MINIMUM THAT IS ATTRIBUTABLE TO THE DESIG-
NATED  AGENT  OF  THE COMBINED GROUP. IN ADDITION, THE TAX ON A COMBINED
REPORT SHALL INCLUDE THE FIXED DOLLAR MINIMUM TAX  SPECIFIED  IN  CLAUSE
(IV)  OF SUBPARAGRAPH ONE OF PARAGRAPH (E) OF SUBDIVISION ONE OF SECTION
11-654 OF THIS SUBCHAPTER FOR EACH MEMBER OF THE COMBINED  GROUP,  OTHER
THAN THE DESIGNATED AGENT, THAT IS A TAXPAYER.
  (B)  THE  COMBINED  BUSINESS INCOME BASE IS THE AMOUNT OF THE COMBINED
BUSINESS INCOME OF THE COMBINED GROUP THAT IS  ALLOCATED  TO  THE  CITY,
REDUCED  BY  ANY PRIOR NET OPERATING LOSS CONVERSION SUBTRACTION AND ANY
NET OPERATING LOSS DEDUCTION FOR THE COMBINED GROUP. THE COMBINED  CAPI-
TAL  BASE  IS  THE  AMOUNT OF THE COMBINED CAPITAL OF THE COMBINED GROUP
THAT IS ALLOCATED TO THE CITY.
  2. (A) EXCEPT AS PROVIDED IN PARAGRAPH (C) OF  THIS  SUBDIVISION,  ANY
TAXPAYER  (1)  WHICH OWNS OR CONTROLS EITHER DIRECTLY OR INDIRECTLY MORE
THAN FIFTY PERCENT OF THE VOTING POWER OF THE CAPITAL STOCK  OF  ONE  OR
MORE  OTHER  CORPORATIONS,  OR (2) MORE THAN FIFTY PERCENT OF THE VOTING
POWER OF THE CAPITAL STOCK  OF  WHICH  IS  OWNED  OR  CONTROLLED  EITHER
DIRECTLY  OR  INDIRECTLY  BY ONE OR MORE OTHER CORPORATIONS, OR (3) MORE

S. 4610--A                         68                         A. 6721--A

THAN FIFTY PERCENT OF THE VOTING POWER OF THE CAPITAL STOCK OF WHICH AND
THE CAPITAL STOCK OF  ONE  OR  MORE  OTHER  CORPORATIONS,  IS  OWNED  OR
CONTROLLED,  DIRECTLY OR INDIRECTLY, BY THE SAME INTERESTS, AND (4) THAT
IS  ENGAGED  IN  A UNITARY BUSINESS WITH THOSE CORPORATIONS (HEREINAFTER
REFERRED TO AS "RELATED CORPORATIONS"), SHALL  MAKE  A  COMBINED  REPORT
WITH THOSE OTHER CORPORATIONS.
  (B)  A CORPORATION REQUIRED TO MAKE A COMBINED REPORT WITHIN THE MEAN-
ING OF THIS SECTION SHALL ALSO INCLUDE (1) A CAPTIVE REIT AND A  CAPTIVE
RIC; (2) A COMBINABLE CAPTIVE INSURANCE COMPANY; AND (3) AN ALIEN CORPO-
RATION  THAT  SATISFIES THE CONDITIONS IN PARAGRAPH (A) OF THIS SUBDIVI-
SION IF (I) UNDER ANY PROVISION  OF  THE  INTERNAL  REVENUE  CODE,  THAT
CORPORATION IS TREATED AS A "DOMESTIC CORPORATION" AS DEFINED IN SECTION
SEVEN  THOUSAND  SEVEN HUNDRED ONE OF THE INTERNAL REVENUE CODE, OR (II)
IT HAS EFFECTIVELY CONNECTED INCOME FOR THE  TAXABLE  YEAR  PURSUANT  TO
CLAUSE  (III)  OF  THE OPENING PARAGRAPH OF SUBDIVISION EIGHT OF SECTION
11-652 OF THIS SUBCHAPTER.
  (C) A CORPORATION REQUIRED OR PERMITTED  TO  MAKE  A  COMBINED  REPORT
UNDER  THIS  SECTION  DOES NOT INCLUDE (1) A CORPORATION THAT IS TAXABLE
UNDER A TAX IMPOSED BY SUBCHAPTER TWO OR THREE OF THIS CHAPTER OR  CHAP-
TER  ELEVEN  OF THIS TITLE (EXCEPT FOR A VENDOR OF UTILITY SERVICES THAT
IS TAXABLE UNDER BOTH CHAPTER ELEVEN OF THIS TITLE AND THIS SUBCHAPTER),
OR WOULD BE TAXABLE UNDER A TAX IMPOSED BY SUBCHAPTER TWO  OR  THREE  OF
THIS  CHAPTER  OR  CHAPTER  ELEVEN OF THIS TITLE (EXCEPT FOR A VENDOR OF
UTILITY SERVICES THAT IS TAXABLE UNDER BOTH CHAPTER ELEVEN OF THIS TITLE
AND THIS SUBCHAPTER), OR WOULD HAVE BEEN TAXABLE AS AN INSURANCE  CORPO-
RATION  UNDER  THE  FORMER  PART  IV,  TITLE R, CHAPTER FORTY-SIX OF THE
ADMINISTRATIVE CODE AS IN EFFECT ON  JUNE  THIRTIETH,  NINETEEN  HUNDRED
SEVENTY-FOUR;  (2)  A REIT THAT IS NOT A CAPTIVE REIT, AND A RIC THAT IS
NOT A CAPTIVE RIC; OR (3) AN ALIEN CORPORATION THAT UNDER ANY  PROVISION
OF  THE INTERNAL REVENUE CODE IS NOT TREATED AS A "DOMESTIC CORPORATION"
AS DEFINED IN SECTION SEVEN THOUSAND SEVEN HUNDRED ONE OF SUCH CODE  AND
HAS  NO  EFFECTIVELY  CONNECTED  INCOME FOR THE TAXABLE YEAR PURSUANT TO
CLAUSE (III) OF THE OPENING PARAGRAPH OF SUBDIVISION  EIGHT  OF  SECTION
11-652  OF  THIS  SUBCHAPTER.   IF A CORPORATION IS SUBJECT TO TAX UNDER
THIS SUBCHAPTER SOLELY AS A RESULT OF ITS OWNERSHIP OF A LIMITED PARTNER
INTEREST IN A LIMITED PARTNERSHIP  THAT  IS  DOING  BUSINESS,  EMPLOYING
CAPITAL,  OWNING  OR  LEASING PROPERTY, OR MAINTAINING AN OFFICE IN THIS
CITY, AND NONE OF THE CORPORATION'S RELATED CORPORATIONS ARE SUBJECT  TO
TAX  UNDER  THIS  SUBCHAPTER,  SUCH CORPORATION SHALL NOT BE REQUIRED OR
PERMITTED TO FILE A COMBINED REPORT UNDER THIS SECTION WITH SUCH RELATED
CORPORATIONS.
  (D) A COMBINED REPORT SHALL BE FILED BY THE DESIGNATED  AGENT  OF  THE
COMBINED GROUP AS DETERMINED UNDER SUBDIVISION SEVEN OF THIS SECTION.
  3.  (A)  SUBJECT TO THE PROVISIONS OF PARAGRAPH (C) OF SUBDIVISION TWO
OF THIS SECTION, A TAXPAYER MAY ELECT TO TREAT AS ITS COMBINED GROUP ALL
CORPORATIONS THAT MEET THE OWNERSHIP REQUIREMENTS DESCRIBED IN PARAGRAPH
(A) OF SUBDIVISION TWO OF THIS SECTION (SUCH  CORPORATIONS  COLLECTIVELY
REFERRED  TO IN THIS SUBDIVISION AS THE "COMMONLY OWNED GROUP"). IF THAT
ELECTION IS MADE, THE COMMONLY OWNED GROUP SHALL CALCULATE THE  COMBINED
BUSINESS  INCOME,  COMBINED  BUSINESS  CAPITAL, AND FIXED DOLLAR MINIMUM
AMOUNT OF ALL MEMBERS OF THE GROUP IN ACCORDANCE WITH PARAGRAPH FOUR  OF
THIS  SUBDIVISION, WHETHER OR NOT THAT BUSINESS INCOME OR BUSINESS CAPI-
TAL IS FROM A SINGLE UNITARY BUSINESS.
  (B) THE ELECTION UNDER THIS SUBDIVISION SHALL BE MADE ON AN  ORIGINAL,
TIMELY  FILED  RETURN  (DETERMINED  WITH  REGARD  TO  EXTENSIONS) OF THE
COMBINED GROUP. ANY CORPORATION ENTERING A COMMONLY OWNED  GROUP  SUBSE-

S. 4610--A                         69                         A. 6721--A

QUENT  TO  THE  YEAR OF ELECTION SHALL BE INCLUDED IN THE COMBINED GROUP
AND IS CONSIDERED TO HAVE WAIVED ANY OBJECTION TO ITS INCLUSION  IN  THE
COMBINED GROUP.
  (C)  THE ELECTION SHALL BE IRREVOCABLE, AND BINDING FOR AND APPLICABLE
TO THE TAXABLE YEAR FOR WHICH IT IS MADE AND FOR THE  NEXT  SIX  TAXABLE
YEARS.  THE  ELECTION  WILL  AUTOMATICALLY  BE RENEWED FOR ANOTHER SEVEN
TAXABLE YEARS AFTER IT HAS BEEN IN EFFECT FOR SEVEN TAXABLE YEARS UNLESS
IT IS  AFFIRMATIVELY  REVOKED.  THE  REVOCATION  SHALL  BE  MADE  ON  AN
ORIGINAL, TIMELY FILED RETURN (DETERMINED WITH REGARD TO EXTENSIONS) FOR
THE  FIRST  TAXABLE YEAR AFTER THE COMPLETION OF A SEVEN YEAR PERIOD FOR
WHICH AN ELECTION UNDER THIS SUBDIVISION WAS IN PLACE. IN THE CASE OF  A
REVOCATION, A NEW ELECTION UNDER THIS SUBDIVISION SHALL NOT BE PERMITTED
IN  ANY OF THE IMMEDIATELY FOLLOWING THREE TAXABLE YEARS. IN DETERMINING
THE SEVEN AND THREE YEAR PERIODS  DESCRIBED  IN  THIS  PARAGRAPH,  SHORT
TAXABLE YEARS SHALL NOT BE CONSIDERED OR COUNTED.
  4.  (A) IN COMPUTING THE TAX BASES FOR A COMBINED REPORT, THE COMBINED
GROUP SHALL GENERALLY BE TREATED AS  A  SINGLE  CORPORATION,  EXCEPT  AS
OTHERWISE PROVIDED, AND SUBJECT TO ANY REGULATIONS OR GUIDANCE ISSUED BY
THE COMMISSIONER OF FINANCE OR THE DEPARTMENT OF FINANCE.
  (B)(1) IN COMPUTING COMBINED BUSINESS INCOME, ALL INTERCORPORATE DIVI-
DENDS  SHALL  BE  ELIMINATED,  AND ALL OTHER INTERCORPORATE TRANSACTIONS
SHALL BE DEFERRED IN A MANNER SIMILAR  TO  THE  UNITED  STATES  TREASURY
DEPARTMENT  REGULATIONS  RELATING  TO  INTERCOMPANY  TRANSACTIONS  UNDER
SECTION FIFTEEN HUNDRED TWO OF THE INTERNAL REVENUE CODE.
  (2) IN COMPUTING COMBINED CAPITAL, ALL  INTERCORPORATE  STOCKHOLDINGS,
INTERCORPORATE  BILLS,  INTERCORPORATE  NOTES  RECEIVABLE  AND  PAYABLE,
INTERCORPORATE ACCOUNTS RECEIVABLE AND PAYABLE, AND OTHER INTERCORPORATE
INDEBTEDNESS, SHALL BE ELIMINATED.
  (C) QUALIFICATION FOR  CREDITS,  INCLUDING  ANY  LIMITATIONS  THEREON,
SHALL  BE  DETERMINED SEPARATELY FOR EACH OF THE MEMBERS OF THE COMBINED
GROUP, AND SHALL NOT BE DETERMINED ON A COMBINED GROUP BASIS, EXCEPT  AS
OTHERWISE  PROVIDED.   HOWEVER, THE CREDITS SHALL BE APPLIED AGAINST THE
COMBINED TAX OF THE GROUP. TO THE EXTENT THAT  A  PROVISION  OF  SECTION
11-654  OF  THIS  SUBCHAPTER,  OR  ANY  OTHER APPLICABLE SECTION OF THIS
SUBCHAPTER,  LIMITS  A  CREDIT  TO  THE  FIXED  DOLLAR  MINIMUM   AMOUNT
PRESCRIBED IN CLAUSE (IV) OF SUBPARAGRAPH ONE OF PARAGRAPH (E) OF SUBDI-
VISION ONE OF SECTION 11-654 OF THIS SUBCHAPTER, SUCH FIXED DOLLAR MINI-
MUM AMOUNT SHALL BE THE FIXED DOLLAR MINIMUM AMOUNT THAT IS ATTRIBUTABLE
TO THE DESIGNATED AGENT OF THE COMBINED GROUP.
  (D)(1)  A  NET  OPERATING  LOSS  DEDUCTION IS ALLOWED IN COMPUTING THE
COMBINED BUSINESS INCOME BASE. SUCH DEDUCTION MAY REDUCE THE TAX ON  THE
COMBINED  BUSINESS  INCOME BASE TO THE HIGHER OF THE TAX ON THE COMBINED
CAPITAL OR THE FIXED DOLLAR MINIMUM AMOUNT THAT IS ATTRIBUTABLE  TO  THE
DESIGNATED  AGENT  OF THE COMBINED GROUP.  A COMBINED NET OPERATING LOSS
DEDUCTION IS EQUAL TO THE AMOUNT OF COMBINED NET OPERATING LOSS OR LOSS-
ES FROM ONE OR MORE TAXABLE YEARS THAT ARE CARRIED  FORWARD  OR  CARRIED
BACK  TO A PARTICULAR TAXABLE YEAR. A COMBINED NET OPERATING LOSS IS THE
COMBINED BUSINESS LOSS INCURRED IN A PARTICULAR TAXABLE YEAR  MULTIPLIED
BY  THE COMBINED BUSINESS ALLOCATION PERCENTAGE FOR THAT YEAR DETERMINED
AS PROVIDED IN SUBDIVISION FIVE OF THIS SECTION.
  (2) THE COMBINED NET OPERATING LOSS DEDUCTION AND COMBINED NET OPERAT-
ING LOSS ARE ALSO SUBJECT TO THE PROVISIONS CONTAINED IN PARAGRAPHS  (A)
THROUGH (G) OF SUBDIVISION THREE OF SECTION 11-654.1 OF THIS SUBCHAPTER.
  (3)  IN THE CASE OF A CORPORATION THAT FILES A COMBINED REPORT, EITHER
IN THE YEAR THE NET OPERATING LOSS IS INCURRED OR IN THE YEAR IN WHICH A
DEDUCTION IS CLAIMED ON ACCOUNT OF THE LOSS, THE COMBINED NET  OPERATING

S. 4610--A                         70                         A. 6721--A

LOSS DEDUCTION IS DETERMINED AS IF THE COMBINED GROUP IS A SINGLE CORPO-
RATION  AND,  TO THE EXTENT POSSIBLE AND NOT OTHERWISE INCONSISTENT WITH
THIS SUBDIVISION, IS SUBJECT TO THE SAME LIMITATIONS  THAT  WOULD  APPLY
FOR  FEDERAL INCOME TAX PURPOSES UNDER THE INTERNAL REVENUE CODE AND THE
CODE OF FEDERAL REGULATIONS AS IF SUCH CORPORATION HAD  FILED  FOR  SUCH
TAXABLE  YEAR  A  CONSOLIDATED  FEDERAL  INCOME TAX RETURN WITH THE SAME
CORPORATIONS INCLUDED IN THE COMBINED REPORT. IF A CORPORATION  FILES  A
COMBINED  REPORT,  REGARDLESS  OF  WHETHER IT FILED A SEPARATE RETURN OR
CONSOLIDATED RETURN FOR FEDERAL INCOME TAX PURPOSES, THE  NET  OPERATING
LOSS  AND  NET  OPERATING  LOSS DEDUCTION FOR THE COMBINED GROUP MUST BE
COMPUTED AS IF THE CORPORATION HAD FILED A CONSOLIDATED RETURN  FOR  THE
SAME CORPORATIONS FOR FEDERAL INCOME TAX PURPOSES.
  (4)  IN GENERAL, ANY NET OPERATING LOSS CARRYOVER FROM A YEAR IN WHICH
A COMBINED REPORT WAS FILED SHALL BE BASED ON THE COMBINED NET OPERATING
LOSS OF THE GROUP OF CORPORATIONS FILING SUCH REPORT. THE PORTION OF THE
COMBINED LOSS ATTRIBUTABLE TO ANY MEMBER OF THE GROUP THAT FILES A SEPA-
RATE REPORT FOR A SUCCEEDING TAXABLE YEAR WILL BE AN AMOUNT BEARING  THE
SAME  RELATION  TO  THE  COMBINED LOSS AS THE NET OPERATING LOSS OF SUCH
CORPORATION BEARS TO THE TOTAL NET OPERATING LOSS OF ALL MEMBERS OF  THE
GROUP  HAVING SUCH LOSSES TO THE EXTENT THAT THEY ARE TAKEN INTO ACCOUNT
IN COMPUTING THE COMBINED NET OPERATING LOSS.
  (D-1) A PRIOR NET OPERATING LOSS CONVERSION SUBTRACTION IS ALLOWED  IN
COMPUTING THE COMBINED BUSINESS INCOME BASE, AS PROVIDED IN SUBDIVISIONS
ONE AND TWO OF SECTION 11-654.1 OF THIS SUBCHAPTER. SUCH SUBTRACTION MAY
REDUCE  THE  TAX ON COMBINED BUSINESS INCOME TO THE HIGHER OF THE TAX ON
COMBINED CAPITAL OR THE FIXED DOLLAR MINIMUM AMOUNT THAT IS ATTRIBUTABLE
TO THE DESIGNATED AGENT OF THE COMBINED GROUP.
  (E)(I) ANY ELECTION MADE PURSUANT  TO  PARAGRAPH  (B)  OF  SUBDIVISION
FIVE,  PARAGRAPHS (B) AND (C) OF SUBDIVISION FIVE-A OF SECTION 11-652 OF
THIS SUBCHAPTER, AND PARAGRAPH  (G)  OF  SUBDIVISION  THREE  OF  SECTION
11-654.1  OF  THIS SUBCHAPTER SHALL APPLY TO ALL MEMBERS OF THE COMBINED
GROUP.
  (II) THE DETERMINATION OF WHETHER OR NOT THE LIMITATION ON  INVESTMENT
INCOME  PROVIDED  IN  SUBPARAGRAPH (III) OF PARAGRAPH (A) OF SUBDIVISION
FIVE OF SECTION 11-652 OF THIS SUBCHAPTER TO THE COMBINED GROUP SHALL BE
BASED ON THE INVESTMENT INCOME OF THE COMBINED GROUP, DETERMINED WITHOUT
REGARD TO  INTEREST  EXPENSES  ATTRIBUTABLE  TO  INVESTMENT  CAPITAL  OR
INVESTMENT INCOME, AND THE ENTIRE NET INCOME OF THE COMBINED GROUP.
  (F)(1)  IN  THE  CASE  OF A CAPTIVE REIT OR CAPTIVE RIC REQUIRED UNDER
THIS SECTION TO BE INCLUDED IN A  COMBINED  REPORT,  ENTIRE  NET  INCOME
SHALL  BE COMPUTED AS REQUIRED UNDER SUBDIVISION SEVEN (IN THE CASE OF A
CAPTIVE REIT) OR SUBDIVISION EIGHT (IN THE CASE OF  A  CAPTIVE  RIC)  OF
SECTION  11-653  OF  THIS  SUBCHAPTER.  HOWEVER, THE DEDUCTION UNDER THE
INTERNAL REVENUE CODE FOR DIVIDENDS PAID BY THE CAPTIVE REIT OR  CAPTIVE
RIC  TO ANY MEMBER OF THE AFFILIATED GROUP THAT INCLUDES THE CORPORATION
THAT DIRECTLY OR INDIRECTLY OWNS OVER FIFTY PERCENT OF THE VOTING  STOCK
OF  THE  CAPTIVE REIT OR CAPTIVE RIC SHALL NOT BE ALLOWED.  FOR PURPOSES
OF THIS SUBPARAGRAPH, THE  TERM  "AFFILIATED  GROUP"  MEANS  "AFFILIATED
GROUP" AS DEFINED IN SECTION FIFTEEN HUNDRED FOUR OF THE INTERNAL REVEN-
UE CODE, BUT WITHOUT REGARD TO THE EXCEPTIONS PROVIDED FOR IN SUBSECTION
(B) OF THAT SECTION.
  (2)  IN  THE  CASE  OF A COMBINABLE CAPTIVE INSURANCE COMPANY REQUIRED
UNDER THIS SECTION TO BE INCLUDED  IN  A  COMBINED  REPORT,  ENTIRE  NET
INCOME  SHALL  BE  COMPUTED  AS REQUIRED BY SUBDIVISION EIGHT OF SECTION
11-652 OF THIS SUBCHAPTER.

S. 4610--A                         71                         A. 6721--A

  (G) IF MORE THAN ONE MEMBER OF A COMBINED GROUP IS ELIGIBLE FOR ANY OF
THE MODIFICATIONS DESCRIBED IN PARAGRAPHS (Q), (R) OR (S) OF SUBDIVISION
EIGHT OF SECTION 11-652  OF  THIS  SUBCHAPTER,  ALL  SUCH  MEMBERS  MUST
UTILIZE THE SAME MODIFICATION.
  5.  (A)  IN  DETERMINING  THE  BUSINESS  ALLOCATION  PERCENTAGE  FOR A
COMBINED REPORT, THE RECEIPTS, NET INCOME, NET GAINS AND OTHER ITEMS  OF
EACH  MEMBER  OF THE COMBINED GROUP, WHETHER OR NOT THEY ARE A TAXPAYER,
ARE INCLUDED AND INTERCORPORATE RECEIPTS, INCOME AND  GAINS  ARE  ELIMI-
NATED.  RECEIPTS, NET INCOME, NET GAINS AND OTHER ITEMS ARE SOURCED, AND
THE AMOUNTS ALLOWED IN THE RECEIPTS FRACTION ARE DETERMINED, AS PROVIDED
IN SECTION 11-654.2 OF THIS SUBCHAPTER.
  (B) AN ELECTION MADE TO ALLOCATE  INCOME  AND  GAINS  FROM  QUALIFYING
FINANCIAL  INSTRUMENTS  PURSUANT TO SUBPARAGRAPH ONE OF PARAGRAPH (A) OF
SUBDIVISION FIVE OF SECTION 11-654.2 OF THIS SUBCHAPTER SHALL  APPLY  TO
ALL MEMBERS OF THE COMBINED GROUP.
  6.  EVERY  MEMBER  OF  THE COMBINED GROUP THAT IS SUBJECT TO TAX UNDER
THIS ARTICLE SHALL BE JOINTLY AND  SEVERALLY  LIABLE  FOR  THE  TAX  DUE
PURSUANT TO A COMBINED REPORT.
  7.  EACH  COMBINED  GROUP  SHALL  APPOINT  A  DESIGNATED AGENT FOR THE
COMBINED GROUP, WHICH SHALL BE A TAXPAYER. ONLY THE DESIGNATED AGENT MAY
ACT ON BEHALF OF THE MEMBERS OF THE COMBINED GROUP FOR MATTERS  RELATING
TO THE COMBINED REPORT.
  S  11-655  REPORTS.  1.  EVERY CORPORATION HAVING AN OFFICER, AGENT OR
REPRESENTATIVE WITHIN THE  CITY,  SHALL  ANNUALLY  ON  OR  BEFORE  MARCH
FIFTEENTH,  TRANSMIT  TO  THE COMMISSIONER OF FINANCE A REPORT IN A FORM
PRESCRIBED BY THE COMMISSIONER OF FINANCE  (EXCEPT  THAT  A  CORPORATION
WHICH  REPORTS  ON  THE BASIS OF A FISCAL YEAR SHALL TRANSMIT ITS REPORT
WITHIN TWO AND ONE-HALF MONTHS AFTER  THE  CLOSE  OF  ITS  FISCAL  YEAR)
SETTING  FORTH  SUCH  INFORMATION  AS  THE  COMMISSIONER  OF FINANCE MAY
PRESCRIBE, AND EVERY TAXPAYER WHICH CEASES TO DO BUSINESS IN THE CITY OR
TO BE SUBJECT TO THE TAX IMPOSED BY THIS SUBCHAPTER  SHALL  TRANSMIT  TO
THE COMMISSIONER OF FINANCE A REPORT ON THE DATE OF SUCH CESSATION OR AT
SUCH OTHER TIME AS THE COMMISSIONER OF FINANCE MAY REQUIRE COVERING EACH
YEAR OR PERIOD FOR WHICH NO REPORT WAS THERETOFORE FILED. EVERY TAXPAYER
SHALL ALSO TRANSMIT SUCH OTHER REPORTS AND SUCH FACTS AND INFORMATION AS
THE  COMMISSIONER  OF  FINANCE MAY REQUIRE IN THE ADMINISTRATION OF THIS
SUBCHAPTER. THE COMMISSIONER OF FINANCE MAY GRANT A REASONABLE EXTENSION
OF TIME FOR FILING REPORTS WHENEVER GOOD CAUSE EXISTS.
  AN AUTOMATIC EXTENSION OF SIX MONTHS FOR  THE  FILING  OF  ITS  ANNUAL
REPORT  SHALL  BE ALLOWED ANY TAXPAYER IF, WITHIN THE TIME PRESCRIBED BY
THE PRECEDING PARAGRAPH, WHICHEVER IS APPLICABLE,  SUCH  TAXPAYER  FILES
WITH  THE  COMMISSIONER  OF FINANCE AN APPLICATION FOR EXTENSION IN SUCH
FORM AS THE COMMISSIONER OF FINANCE MAY PRESCRIBE BY REGULATION AND PAYS
ON OR BEFORE THE DATE OF SUCH FILING THE AMOUNT  PROPERLY  ESTIMATED  AS
ITS TAX.
  2.  EVERY  REPORT  SHALL  HAVE  ANNEXED THERETO A CERTIFICATION BY THE
PRESIDENT,  VICE-PRESIDENT,  TREASURER,   ASSISTANT   TREASURER,   CHIEF
ACCOUNTING OFFICER OR ANOTHER OFFICER OF THE TAXPAYER DULY AUTHORIZED SO
TO  ACT TO THE EFFECT THAT THE STATEMENTS CONTAINED THEREIN ARE TRUE. IN
THE CASE OF AN ASSOCIATION, WITHIN THE MEANING  OF  PARAGRAPH  THREE  OF
SECTION (A) OF SECTION SEVENTY-SEVEN HUNDRED ONE OF THE INTERNAL REVENUE
CODE,  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, SUCH CERTIFICATION SHALL BE MADE BY ANY PERSON DULY

S. 4610--A                         72                         A. 6721--A

AUTHORIZED SO TO ACT ON  BEHALF  OF  SUCH  ASSOCIATION,  PUBLICLY-TRADED
PARTNERSHIP OR BUSINESS. THE FACT THAT AN INDIVIDUAL'S NAME IS SIGNED ON
A  CERTIFICATION  OF  THE REPORT SHALL BE PRIMA FACIE EVIDENCE THAT SUCH
INDIVIDUAL IS AUTHORIZED TO SIGN AND CERTIFY THE REPORT ON BEHALF OF THE
CORPORATION.  BLANK  FORMS  OF REPORTS SHALL BE FURNISHED BY THE COMMIS-
SIONER OF FINANCE, ON APPLICATION, BUT FAILURE TO SECURE  SUCH  A  BLANK
SHALL  NOT  RELEASE  ANY  CORPORATION  FROM THE OBLIGATION OF MAKING ANY
REPORT REQUIRED BY THIS SUBCHAPTER.
  2-A.  THE  COMMISSIONER  OF  FINANCE  MAY  PRESCRIBE  REGULATIONS  AND
INSTRUCTIONS  REQUIRING  RETURNS  OF INFORMATION TO BE MADE AND FILED IN
CONJUNCTION WITH THE REPORTS REQUIRED  TO  BE  FILED  PURSUANT  TO  THIS
SECTION,  RELATING  TO PAYMENTS MADE TO SHAREHOLDERS OWNING, DIRECTLY OR
INDIRECTLY, INDIVIDUALLY OR IN THE AGGREGATE, MORE THAN FIFTY PERCENT OF
THE ISSUED CAPITAL STOCK OF THE TAXPAYER, WHERE SUCH PAYMENTS ARE TREAT-
ED AS PAYMENTS OF INTEREST IN  THE  COMPUTATION  OF  ENTIRE  NET  INCOME
REPORTED ON SUCH REPORTS.
  3.  IF THE AMOUNT OF TAXABLE INCOME OR OTHER BASIS OF TAX FOR ANY YEAR
OF ANY TAXPAYER AS RETURNED TO THE UNITED STATES TREASURY DEPARTMENT  OR
THE  NEW  YORK  STATE COMMISSIONER OF TAXATION AND FINANCE IS CHANGED OR
CORRECTED BY THE COMMISSIONER OF INTERNAL REVENUE OR  OTHER  OFFICER  OF
THE  UNITED  STATES  OR  THE NEW YORK STATE COMMISSIONER OF TAXATION AND
FINANCE OR OTHER COMPETENT AUTHORITY, OR  WHERE  A  RENEGOTIATION  OF  A
CONTRACT  OR SUBCONTRACT WITH THE UNITED STATES OR THE STATE OF NEW YORK
RESULTS IN A CHANGE IN TAXABLE INCOME OR OTHER BASIS OF TAX, OR WHERE  A
RECOVERY  OF A WAR LOSS RESULTS IN A COMPUTATION OR RECOMPUTATION OF ANY
TAX IMPOSED BY THE UNITED STATES OR THE STATE  OF  NEW  YORK,  OR  IF  A
TAXPAYER,  PURSUANT TO SUBSECTION (D) OF SECTION SIXTY-TWO HUNDRED THIR-
TEEN OF THE INTERNAL REVENUE CODE, EXECUTES A NOTICE OF  WAIVER  OF  THE
RESTRICTIONS PROVIDED IN SUBSECTION (A) OF SAID SECTION, OR IF A TAXPAY-
ER, PURSUANT TO SUBSECTION (F) OF SECTION ONE THOUSAND EIGHTY-ONE OF THE
TAX  LAW,  EXECUTES  A  NOTICE OF WAIVER OF THE RESTRICTIONS PROVIDED IN
SUBSECTION (C) OF SAID SECTION, SUCH TAXPAYER SHALL REPORT SUCH  CHANGED
OR  CORRECTED  TAXABLE  INCOME  OR OTHER BASIS OF TAX, OR THE RESULTS OF
SUCH RENEGOTIATION, OR  SUCH  COMPUTATION,  OR  RECOMPUTATION,  OR  SUCH
EXECUTION OF SUCH NOTICE OF WAIVER AND THE CHANGES OR CORRECTIONS OF THE
TAXPAYER'S  FEDERAL  OR  NEW YORK STATE TAXABLE INCOME OR OTHER BASIS OF
TAX ON WHICH IT IS BASED, WITHIN NINETY  DAYS  (OR  ONE  HUNDRED  TWENTY
DAYS,  IN  THE  CASE  OF  A TAXPAYER MAKING A COMBINED REPORT UNDER THIS
SUBCHAPTER FOR SUCH YEAR) AFTER SUCH EXECUTION  OR  THE  FINAL  DETERMI-
NATION  OF  SUCH CHANGE OR CORRECTION OR RENEGOTIATION, OR SUCH COMPUTA-
TION, OR RECOMPUTATION, OR AS REQUIRED BY THE COMMISSIONER  OF  FINANCE,
AND SHALL CONCEDE THE ACCURACY OF SUCH DETERMINATION OR STATE WHEREIN IT
IS  ERRONEOUS.  THE  ALLOWANCE OF A TENTATIVE CARRYBACK ADJUSTMENT BASED
UPON A NET OPERATING LOSS CARRYBACK OR NET CAPITAL LOSS CARRYBACK PURSU-
ANT TO SECTION SIXTY-FOUR HUNDRED ELEVEN OF THE  INTERNAL  REVENUE  CODE
SHALL  BE TREATED AS A FINAL DETERMINATION FOR PURPOSES OF THIS SUBDIVI-
SION. ANY TAXPAYER FILING AN AMENDED RETURN WITH SUCH  DEPARTMENT  SHALL
ALSO FILE WITHIN NINETY DAYS (OR ONE HUNDRED TWENTY DAYS, IN THE CASE OF
A TAXPAYER MAKING A COMBINED REPORT UNDER THIS SUBCHAPTER FOR SUCH YEAR)
THEREAFTER AN AMENDED REPORT WITH THE COMMISSIONER OF FINANCE.
  4.  THE  PROVISIONS OF SECTION 11-654.3 OF THIS SUBCHAPTER SHALL APPLY
TO COMBINED REPORTS.
  5. IN CASE IT SHALL APPEAR TO THE COMMISSIONER  OF  FINANCE  THAT  ANY
AGREEMENT,  UNDERSTANDING OR ARRANGEMENT EXISTS BETWEEN THE TAXPAYER AND
ANY OTHER CORPORATION OR ANY PERSON OR FIRM, WHEREBY THE ACTIVITY, BUSI-
NESS, INCOME OR CAPITAL OF THE TAXPAYER WITHIN THE CITY IS IMPROPERLY OR

S. 4610--A                         73                         A. 6721--A

INACCURATELY REFLECTED, THE COMMISSIONER OF FINANCE  IS  AUTHORIZED  AND
EMPOWERED,  IN ITS DISCRETION AND IN SUCH MANNER AS IT MAY DETERMINE, TO
ADJUST ITEMS OF INCOME, DEDUCTIONS AND CAPITAL, AND TO ELIMINATE  ASSETS
IN  COMPUTING  ANY  ALLOCATION  PERCENTAGE PROVIDED ONLY THAT ANY INCOME
DIRECTLY TRACEABLE THERETO BE ALSO EXCLUDED FROM ENTIRE NET  INCOME,  SO
AS  EQUITABLY  TO DETERMINE THE TAX. WHERE (A) ANY TAXPAYER CONDUCTS ITS
ACTIVITY OR BUSINESS UNDER ANY AGREEMENT, ARRANGEMENT  OR  UNDERSTANDING
IN  SUCH  MANNER AS EITHER DIRECTLY OR INDIRECTLY TO BENEFIT ITS MEMBERS
OR STOCKHOLDERS, OR ANY OF THEM, OR ANY PERSON OR  PERSONS  DIRECTLY  OR
INDIRECTLY INTERESTED IN SUCH ACTIVITY OR BUSINESS, BY ENTERING INTO ANY
TRANSACTION AT MORE OR LESS THAN A FAIR PRICE WHICH, BUT FOR SUCH AGREE-
MENT,  ARRANGEMENT  OR  UNDERSTANDING,  MIGHT HAVE BEEN PAID OR RECEIVED
THEREFOR, OR (B) ANY TAXPAYER, A SUBSTANTIAL PORTION  OF  WHOSE  CAPITAL
STOCK  IS  OWNED  EITHER  DIRECTLY OR INDIRECTLY BY ANOTHER CORPORATION,
ENTERS INTO ANY TRANSACTION WITH SUCH OTHER CORPORATION ON SUCH TERMS AS
TO CREATE AN IMPROPER LOSS OR NET INCOME, THE  COMMISSIONER  OF  FINANCE
MAY  INCLUDE  IN THE ENTIRE NET INCOME OF THE TAXPAYER THE FAIR PROFITS,
WHICH, BUT FOR SUCH AGREEMENT, ARRANGEMENT OR UNDERSTANDING, THE TAXPAY-
ER MIGHT HAVE DERIVED FROM SUCH TRANSACTION. WHERE  ANY  TAXPAYER  OWNS,
DIRECTLY  OR INDIRECTLY, MORE THAN FIFTY PERCENT OF THE CAPITAL STOCK OF
ANOTHER CORPORATION SUBJECT TO TAX UNDER SECTION FIFTEEN  HUNDRED  TWO-A
OF THE TAX LAW AND FIFTY PERCENT OR LESS OF WHOSE GROSS RECEIPTS FOR THE
TAXABLE  YEAR  CONSIST  OF  PREMIUMS,  THE  COMMISSIONER  OF FINANCE MAY
INCLUDE IN THE ENTIRE NET INCOME OF THE TAXPAYER, AS A  DEEMED  DISTRIB-
UTION,  THE AMOUNT OF THE NET INCOME OF THE OTHER CORPORATION THAT IS IN
EXCESS OF ITS NET PREMIUM INCOME.
  6. AN ACTION MAY BE BROUGHT AT ANY TIME BY THE CORPORATION COUNSEL  AT
THE  INSTANCE  OF  THE  COMMISSIONER  OF FINANCE TO COMPEL THE FILING OF
REPORTS DUE UNDER THIS SUBCHAPTER.
  7. REPORTS SHALL BE PRESERVED FOR FIVE YEARS, AND THEREAFTER UNTIL THE
COMMISSIONER OF FINANCE ORDERS THEM TO BE DESTROYED.
  8. WHERE THE NEW YORK  STATE  COMMISSIONER  OF  TAXATION  AND  FINANCE
CHANGES  OR CORRECTS A TAXPAYER'S SALES AND COMPENSATING USE TAX LIABIL-
ITY WITH RESPECT TO THE PURCHASE OR USE OF ITEMS FOR WHICH  A  SALES  OR
COMPENSATING  USE  TAX CREDIT AGAINST THE TAX IMPOSED BY THIS SUBCHAPTER
WAS CLAIMED, THE TAXPAYER SHALL REPORT SUCH CHANGE OR CORRECTION TO  THE
COMMISSIONER OF FINANCE WITHIN NINETY DAYS OF THE FINAL DETERMINATION OF
SUCH  CHANGE  OR  CORRECTION,  OR  AS  REQUIRED  BY  THE COMMISSIONER OF
FINANCE, AND SHALL CONCEDE THE ACCURACY OF SUCH DETERMINATION  OR  STATE
WHEREIN IT IS ERRONEOUS. ANY TAXPAYER FILING AN AMENDED RETURN OR REPORT
RELATING  TO  THE  PURCHASE  OR USE OF SUCH ITEMS SHALL ALSO FILE WITHIN
NINETY DAYS THEREAFTER A COPY OF SUCH AMENDED RETURN OR REPORT WITH  THE
COMMISSIONER OF FINANCE.
  S  11-656 PAYMENT AND LIEN OF TAX. 1. TO THE EXTENT THE TAX IMPOSED BY
SECTION 11-653 OF THIS SUBCHAPTER SHALL NOT HAVE  BEEN  PREVIOUSLY  PAID
PURSUANT TO SECTION 11-658 OF THIS SUBCHAPTER:
  (A)  SUCH TAX, OR THE BALANCE THEREOF, SHALL BE PAYABLE TO THE COMMIS-
SIONER OF FINANCE IN FULL AT THE TIME  THE  REPORT  IS  REQUIRED  TO  BE
FILED; AND
  (B)  SUCH  TAX,  OR THE BALANCE THEREOF, IMPOSED ON ANY TAXPAYER WHICH
CEASES TO DO BUSINESS IN THE CITY OR TO BE SUBJECT TO THE TAX IMPOSED BY
THIS SUBCHAPTER SHALL BE PAYABLE TO THE COMMISSIONER OF FINANCE  AT  THE
TIME  THE  REPORT  IS  REQUIRED TO BE FILED; ALL OTHER TAXES OF ANY SUCH
TAXPAYER, WHICH PURSUANT TO THE FOREGOING  PROVISIONS  OF  THIS  SECTION
WOULD  OTHERWISE  BE  PAYABLE  SUBSEQUENT  TO  THE  TIME  SUCH REPORT IS
REQUIRED TO BE FILED, SHALL NEVERTHELESS BE PAYABLE AT SUCH TIME.

S. 4610--A                         74                         A. 6721--A

  IF THE TAXPAYER, WITHIN THE TIME PRESCRIBED BY SECTION 11-655 OF  THIS
SUBCHAPTER,  SHALL  HAVE  APPLIED  FOR AN AUTOMATIC EXTENSION OF TIME TO
FILE ITS ANNUAL REPORT AND  SHALL  HAVE  PAID  TO  THE  COMMISSIONER  OF
FINANCE  ON OR BEFORE THE DATE SUCH APPLICATION IS FILED AN AMOUNT PROP-
ERLY  ESTIMATED  AS PROVIDED BY SAID SECTION, THE ONLY AMOUNT PAYABLE IN
ADDITION TO THE TAX SHALL BE INTEREST AT THE UNDERPAYMENT  RATE  SET  BY
THE  COMMISSIONER OF FINANCE PURSUANT TO SECTION 11-687 OF THIS CHAPTER,
OR, IF NO RATE IS SET, AT THE RATE OF SEVEN  AND  ONE-HALF  PERCENT  PER
ANNUM  UPON  THE AMOUNT BY WHICH THE TAX, OR THE PORTION THEREOF PAYABLE
ON OR BEFORE THE DATE THE REPORT WAS REQUIRED TO BE FILED,  EXCEEDS  THE
AMOUNT SO PAID. FOR PURPOSES OF THE PRECEDING SENTENCE:
  (1)  AN  AMOUNT  SO  PAID  SHALL BE DEEMED PROPERLY ESTIMATED IF IT IS
EITHER: (I) NOT LESS THAN NINETY PERCENT OF THE TAX  AS  FINALLY  DETER-
MINED,  OR (II) NOT LESS THAN THE TAX SHOWN ON THE TAXPAYER'S REPORT FOR
THE PRECEDING TAXABLE YEAR, IF SUCH PRECEDING YEAR WAS A TAXABLE YEAR OF
TWELVE MONTHS; AND
  (2) THE TIME WHEN A REPORT IS REQUIRED TO BE FILED SHALL BE DETERMINED
WITHOUT REGARD TO ANY EXTENSION OF TIME FOR FILING SUCH REPORT.
  2. THE COMMISSIONER OF FINANCE MAY GRANT  A  REASONABLE  EXTENSION  OF
TIME FOR PAYMENT OF ANY TAX IMPOSED BY THIS SUBCHAPTER UNDER SUCH CONDI-
TIONS AS THE COMMISSIONER OF FINANCE DEEMS JUST AND PROPER.
  3. INTENTIONALLY OMITTED.
  S  11-657  DECLARATION  OF ESTIMATED TAX. 1. EVERY TAXPAYER SUBJECT TO
THE TAX IMPOSED BY SECTION 11-653 OF THIS SUBCHAPTER SHALL MAKE A DECLA-
RATION OF ITS ESTIMATED TAX FOR THE CURRENT PRIVILEGE PERIOD, CONTAINING
SUCH INFORMATION AS THE COMMISSIONER OF FINANCE MAY PRESCRIBE  BY  REGU-
LATIONS  OR  INSTRUCTIONS,  IF  SUCH  ESTIMATED  TAX  CAN  REASONABLY BE
EXPECTED TO EXCEED ONE THOUSAND DOLLARS.
  2. THE TERM "ESTIMATED TAX" MEANS THE AMOUNT WHICH  A  TAXPAYER  ESTI-
MATES TO BE THE TAX IMPOSED BY SECTION 11-653 OF THIS SUBCHAPTER FOR THE
CURRENT  PRIVILEGE  PERIOD, LESS THE AMOUNT WHICH IT ESTIMATES TO BE THE
SUM OF ANY CREDITS ALLOWABLE AGAINST THE TAX.
  3. IN THE CASE OF A TAXPAYER WHICH REPORTS ON THE BASIS OF A  CALENDAR
YEAR,  A  DECLARATION  OF ESTIMATED TAX SHALL BE FILED ON OR BEFORE JUNE
FIFTEENTH OF THE CURRENT PRIVILEGE PERIOD, EXCEPT THAT IF  THE  REQUIRE-
MENTS OF SUBDIVISION ONE OF THIS SECTION ARE FIRST MET:
  (A)  AFTER MAY THIRTY-FIRST AND BEFORE SEPTEMBER FIRST OF SUCH CURRENT
PRIVILEGE PERIOD, THE DECLARATION SHALL BE FILED ON OR BEFORE  SEPTEMBER
FIFTEENTH; OR
  (B)  AFTER  AUGUST  THIRTY-FIRST  AND  BEFORE  DECEMBER  FIRST OF SUCH
CURRENT PRIVILEGE PERIOD, THE DECLARATION SHALL BE FILED  ON  OR  BEFORE
DECEMBER FIFTEENTH.
  4. A TAXPAYER MAY AMEND A DECLARATION UNDER REGULATIONS OF THE COMMIS-
SIONER OF FINANCE.
  5.  IF,  ON OR BEFORE FEBRUARY FIFTEENTH OF THE SUCCEEDING YEAR IN THE
CASE OF A TAXPAYER WHICH REPORTS ON THE BASIS  OF  A  CALENDAR  YEAR,  A
TAXPAYER  FILES  ITS  REPORT  FOR  THE YEAR FOR WHICH THE DECLARATION IS
REQUIRED, AND PAYS THEREWITH THE BALANCE, IF ANY, OF THE FULL AMOUNT  OF
THE TAX SHOWN TO BE DUE ON THE REPORT:
  (A)  SUCH REPORT SHALL BE CONSIDERED AS ITS DECLARATION IF NO DECLARA-
TION IS REQUIRED TO BE FILED DURING THE  CALENDAR  OR  FISCAL  YEAR  FOR
WHICH  THE  TAX WAS IMPOSED, BUT IS OTHERWISE REQUIRED TO BE FILED ON OR
BEFORE DECEMBER FIFTEENTH PURSUANT TO SUBDIVISION THREE OF THIS SECTION;
AND
  (B) SUCH REPORT SHALL BE CONSIDERED  AS  THE  AMENDMENT  PERMITTED  BY
SUBDIVISION  FOUR  OF  THIS  SECTION  TO  BE FILED ON OR BEFORE DECEMBER

S. 4610--A                         75                         A. 6721--A

FIFTEENTH IF THE TAX SHOWN ON THE REPORT IS GREATER THAN  THE  ESTIMATED
TAX SHOWN ON A DECLARATION PREVIOUSLY MADE.
  6.  THIS  SECTION  SHALL  APPLY  TO PRIVILEGE PERIODS OF TWELVE MONTHS
OTHER THAN A CALENDAR YEAR BY THE SUBSTITUTION OF  THE  MONTHS  OF  SUCH
FISCAL YEAR FOR THE CORRESPONDING MONTHS SPECIFIED IN THIS SECTION.
  7.  IF  THE  PRIVILEGE  PERIOD  FOR  WHICH A TAX IS IMPOSED BY SECTION
11-653 OF THIS SUBCHAPTER IS LESS THAN  TWELVE  MONTHS,  EVERY  TAXPAYER
REQUIRED TO MAKE A DECLARATION OF ESTIMATED TAX FOR SUCH PRIVILEGE PERI-
OD  SHALL  MAKE SUCH A DECLARATION IN ACCORDANCE WITH REGULATIONS OF THE
COMMISSIONER OF FINANCE.
  8. THE COMMISSIONER OF FINANCE MAY GRANT  A  REASONABLE  EXTENSION  OF
TIME,  NOT  TO  EXCEED  THREE  MONTHS, FOR THE FILING OF ANY DECLARATION
REQUIRED PURSUANT TO THIS SECTION, ON SUCH TERMS AND  CONDITIONS  AS  IT
MAY REQUIRE.
  S  11-658  PAYMENTS  ON  ACCOUNT  OF  ESTIMATED TAX. 1. EVERY TAXPAYER
SUBJECT TO THE TAX IMPOSED BY SECTION 11-653 OF  THIS  SUBCHAPTER  SHALL
PAY  WITH  THE  REPORT  REQUIRED TO BE FILED FOR THE PRECEDING PRIVILEGE
PERIOD, IF ANY, OR WITH AN APPLICATION FOR EXTENSION  OF  THE  TIME  AND
FILING  SUCH  REPORT,  AN  AMOUNT EQUAL TO TWENTY-FIVE PER CENTUM OF THE
PRECEDING YEAR'S TAX IF SUCH PRECEDING YEAR'S TAX EXCEEDED ONE  THOUSAND
DOLLARS.
  2.  THE  ESTIMATED  TAX  WITH  RESPECT TO WHICH A DECLARATION FOR SUCH
PRIVILEGE PERIOD IS REQUIRED SHALL BE PAID, IN THE CASE  OF  A  TAXPAYER
WHICH REPORTS ON THE BASIS OF A CALENDAR YEAR, AS FOLLOWS:
  (A) IF THE DECLARATION IS FILED ON OR BEFORE JUNE FIFTEENTH, THE ESTI-
MATED TAX SHOWN THEREON, AFTER APPLYING THERETO THE AMOUNT, IF ANY, PAID
DURING  THE  SAME  PRIVILEGE  PERIOD PURSUANT TO SUBDIVISION ONE OF THIS
SECTION, SHALL BE PAID IN THREE EQUAL INSTALLMENTS. ONE OF SUCH INSTALL-
MENTS SHALL BE PAID AT THE TIME OF THE FILING OF  THE  DECLARATION,  ONE
SHALL  BE  PAID  ON  THE  FOLLOWING  SEPTEMBER FIFTEENTH, AND ONE ON THE
FOLLOWING DECEMBER FIFTEENTH.
  (B) IF THE DECLARATION IS FILED AFTER JUNE  FIFTEENTH  AND  NOT  AFTER
SEPTEMBER  FIFTEENTH OF SUCH PRIVILEGE PERIOD, AND IS NOT REQUIRED TO BE
FILED ON OR BEFORE JUNE FIFTEENTH OF  SUCH  PERIOD,  THE  ESTIMATED  TAX
SHOWN  ON  SUCH  DECLARATION, AFTER APPLYING THERETO THE AMOUNT, IF ANY,
PAID DURING THE SAME PRIVILEGE PERIOD PURSUANT  TO  SUBDIVISION  ONE  OF
THIS  SECTION,  SHALL  BE  PAID  IN  TWO EQUAL INSTALLMENTS. ONE OF SUCH
INSTALLMENTS SHALL BE PAID AT THE TIME OF THE FILING OF THE  DECLARATION
AND ONE SHALL BE PAID ON THE FOLLOWING DECEMBER FIFTEENTH.
  (C)  IF  THE  DECLARATION  IS  FILED AFTER SEPTEMBER FIFTEENTH OF SUCH
PRIVILEGE PERIOD, AND IS NOT REQUIRED TO BE FILED ON OR BEFORE SEPTEMBER
FIFTEENTH OF SUCH PRIVILEGE PERIOD, THE  ESTIMATED  TAX  SHOWN  ON  SUCH
DECLARATION,  AFTER APPLYING THERETO THE AMOUNT, IF ANY, PAID IN RESPECT
TO SUCH PRIVILEGE PERIOD PURSUANT TO SUBDIVISION ONE  OF  THIS  SECTION,
SHALL BE PAID IN FULL AT THE TIME OF THE FILING OF THE DECLARATION.
  (D) IF THE DECLARATION IS FILED AFTER THE TIME PRESCRIBED THEREFOR, OR
AFTER  THE  EXPIRATION OF ANY EXTENSION OF TIME THEREFOR, PARAGRAPHS (B)
AND (C) OF THIS SUBDIVISION SHALL NOT APPLY, AND THERE SHALL BE PAID  AT
THE  TIME OF SUCH FILING ALL INSTALLMENTS OF ESTIMATED TAX PAYABLE AT OR
BEFORE SUCH TIME, AND THE REMAINING INSTALLMENTS SHALL BE  PAID  AT  THE
TIMES  AT WHICH, AND IN THE AMOUNTS IN WHICH, THEY WOULD HAVE BEEN PAYA-
BLE IF THE DECLARATION HAD BEEN FILED WHEN DUE.
  3. IF ANY AMENDMENT OF A DECLARATION IS FILED, THE REMAINING  INSTALL-
MENTS,  IF ANY, SHALL BE RATABLY INCREASED OR DECREASED (AS THE CASE MAY
BE) TO REFLECT ANY INCREASE OR DECREASE IN THE ESTIMATED TAX  BY  REASON
OF  SUCH  AMENDMENT,  AND  IF  ANY  AMENDMENT  IS  MADE  AFTER SEPTEMBER

S. 4610--A                         76                         A. 6721--A

FIFTEENTH OF THE PRIVILEGE PERIOD, ANY INCREASE IN THE ESTIMATED TAX  BY
REASON THEREOF SHALL BE PAID AT THE TIME OF MAKING SUCH AMENDMENT.
  4.  ANY AMOUNT PAID SHALL BE APPLIED AFTER PAYMENT AS A FIRST INSTALL-
MENT AGAINST THE ESTIMATED TAX OF THE TAXPAYER FOR THE CURRENT PRIVILEGE
PERIOD SHOWN ON THE DECLARATION REQUIRED TO BE FILED PURSUANT TO SECTION
11-657 OF THIS SUBCHAPTER OR, IF NO  DECLARATION  OF  ESTIMATED  TAX  IS
REQUIRED  TO BE FILED BY THE TAXPAYER PURSUANT TO SUCH SECTION, ANY SUCH
AMOUNT SHALL BE CONSIDERED A PAYMENT ON ACCOUNT OF THE TAX SHOWN ON  THE
REPORT REQUIRED TO BE FILED BY THE TAXPAYER FOR SUCH PRIVILEGE PERIOD.
  5. NOTWITHSTANDING THE PROVISIONS OF SECTION 11-679 OF THIS CHAPTER OR
OF  SECTION  THREE-A  OF  THE  GENERAL  MUNICIPAL LAW, IF AN AMOUNT PAID
PURSUANT TO SUBDIVISION ONE OF THIS SECTION EXCEEDS THE TAX SHOWN ON THE
REPORT REQUIRED TO BE FILED BY THE TAXPAYER  FOR  THE  PRIVILEGE  PERIOD
DURING  WHICH THE AMOUNT WAS PAID, INTEREST SHALL BE ALLOWED AND PAID ON
THE AMOUNT BY WHICH THE AMOUNT SO  PAID  PURSUANT  TO  SUCH  SUBDIVISION
EXCEEDS  SUCH  TAX,  AT  THE OVERPAYMENT RATE SET BY THE COMMISSIONER OF
FINANCE PURSUANT TO SECTION 11-687 OF THIS CHAPTER, OR, IF  NO  RATE  IS
SET,  AT  THE RATE OF FOUR PERCENT PER ANNUM FROM THE DATE OF PAYMENT OF
THE AMOUNT SO PAID PURSUANT TO SUCH SUBDIVISION TO THE FIFTEENTH DAY  OF
THE  THIRD  MONTH FOLLOWING THE CLOSE OF THE PRIVILEGE PERIOD, PROVIDED,
HOWEVER, THAT NO INTEREST SHALL BE ALLOWED OR PAID UNDER  THIS  SUBDIVI-
SION  IF  THE AMOUNT THEREOF IS LESS THAN ONE DOLLAR OR IF SUCH INTEREST
BECOMES PAYABLE SOLELY BECAUSE OF A CARRYBACK OF A NET OPERATING LOSS IN
A SUBSEQUENT PRIVILEGE PERIOD.
  6. AS USED IN THIS SECTION, "THE PRECEDING YEAR'S TAX" MEANS  THE  TAX
IMPOSED  UPON  THE TAXPAYER BY SECTION 11-653 OF THIS SUBCHAPTER FOR THE
PRECEDING CALENDAR OR FISCAL YEAR, OR, FOR  PURPOSES  OF  COMPUTING  THE
FIRST  INSTALLMENT  OF  ESTIMATED TAX WHEN AN APPLICATION HAS BEEN FILED
FOR EXTENSION OF THE TIME FOR FILING THE REPORT REQUIRED TO BE FILED FOR
SUCH PRECEDING CALENDAR OR FISCAL YEAR, THE  AMOUNT  PROPERLY  ESTIMATED
PURSUANT  TO  SECTION  11-657 OF THIS SUBCHAPTER AS THE TAX IMPOSED UPON
THE TAXPAYER FOR SUCH CALENDAR OR FISCAL YEAR.
  7. THIS SECTION SHALL APPLY TO A PRIVILEGE PERIOD OF LESS THAN  TWELVE
MONTHS IN ACCORDANCE WITH REGULATIONS OF THE COMMISSIONER OF FINANCE.
  8.  THE PROVISIONS OF THIS SECTION SHALL APPLY TO PRIVILEGE PERIODS OF
TWELVE MONTHS OTHER THAN A CALENDAR YEAR  BY  THE  SUBSTITUTION  OF  THE
MONTHS  OF  SUCH  FISCAL  YEAR FOR THE CORRESPONDING MONTHS SPECIFIED IN
SUCH PROVISIONS.
  9. THE COMMISSIONER OF FINANCE MAY GRANT  A  REASONABLE  EXTENSION  OF
TIME,  NOT TO EXCEED SIX MONTHS, FOR PAYMENT OF ANY INSTALLMENT OF ESTI-
MATED TAX REQUIRED PURSUANT TO THIS SECTION, ON SUCH  TERMS  AND  CONDI-
TIONS  AS THE COMMISSIONER OF FINANCE MAY REQUIRE INCLUDING THE FURNISH-
ING OF A BOND OR OTHER  SECURITY  BY  THE  TAXPAYER  IN  AN  AMOUNT  NOT
EXCEEDING  TWICE  THE AMOUNT FOR WHICH ANY EXTENSION OF TIME FOR PAYMENT
IS GRANTED, PROVIDED, HOWEVER, THAT INTEREST AT  THE  UNDERPAYMENT  RATE
SET  BY  THE  COMMISSIONER OF FINANCE PURSUANT TO SECTION 11-687 OF THIS
SUBCHAPTER, OR, IF NO RATE IS SET, AT THE RATE  OF  SEVEN  AND  ONE-HALF
PERCENT  PER  ANNUM FOR THE PERIOD OF THE EXTENSION SHALL BE CHARGED AND
COLLECTED ON THE AMOUNT FOR WHICH ANY EXTENSION OF TIME FOR  PAYMENT  IS
GRANTED UNDER THIS SUBDIVISION.
  10. A TAXPAYER MAY ELECT TO PAY ANY INSTALLMENT OF ESTIMATED TAX PRIOR
TO THE DATE PRESCRIBED IN THIS SECTION FOR PAYMENT THEREOF.
  11. INTENTIONALLY OMITTED.
  S  11-659 COLLECTION OF TAXES. EVERY FOREIGN CORPORATION (OTHER THAN A
MONEYED CORPORATION) SUBJECT  TO  THE  PROVISIONS  OF  THIS  SUBCHAPTER,
EXCEPT  A  CORPORATION  HAVING  AUTHORITY  TO  DO  BUSINESS BY VIRTUE OF

S. 4610--A                         77                         A. 6721--A

SECTION THIRTEEN HUNDRED FIVE OF THE  BUSINESS  CORPORATION  LAW,  SHALL
FILE  IN  THE  DEPARTMENT  OF  STATE A CERTIFICATE OF DESIGNATION IN ITS
CORPORATE NAME, SIGNED AND ACKNOWLEDGED BY ITS PRESIDENT OR A  VICE-PRE-
SIDENT  OR  ITS SECRETARY OR TREASURER, UNDER ITS CORPORATE SEAL, DESIG-
NATING THE SECRETARY OF STATE AS ITS AGENT  UPON  WHOM  PROCESS  IN  ANY
ACTION  PROVIDED FOR BY THIS SUBCHAPTER MAY BE SERVED WITHIN THIS STATE,
AND SETTING FORTH AN ADDRESS TO WHICH THE SECRETARY OF STATE SHALL  MAIL
A  COPY  OF ANY SUCH PROCESS AGAINST THE CORPORATION WHICH MAY BE SERVED
UPON THE SECRETARY OF STATE. IN CASE ANY  SUCH  CORPORATION  SHALL  HAVE
FAILED  TO  FILE  SUCH CERTIFICATE OF DESIGNATION, IT SHALL BE DEEMED TO
HAVE DESIGNATED THE SECRETARY OF STATE AS ITS AGENT UPON WHOM SUCH PROC-
ESS AGAINST IT MAY BE SERVED; AND UNTIL  A  CERTIFICATE  OF  DESIGNATION
SHALL  HAVE  BEEN FILED THE CORPORATION SHALL BE DEEMED TO HAVE DIRECTED
THE SECRETARY OF STATE TO MAIL COPIES OF PROCESS SERVED UPON HIM OR  HER
TO  THE  CORPORATION  AT ITS LAST KNOWN OFFICE ADDRESS WITHIN OR WITHOUT
THE STATE. WHEN A CERTIFICATE OF DESIGNATION  HAS  BEEN  FILED  BY  SUCH
CORPORATION  THE  SECRETARY OF STATE SHALL MAIL COPIES OF PROCESS THERE-
AFTER SERVED UPON THE SECRETARY OF STATE TO THE  ADDRESS  SET  FORTH  IN
SUCH  CERTIFICATE.  ANY  SUCH CORPORATION, FROM TIME TO TIME, MAY CHANGE
THE ADDRESS TO WHICH THE SECRETARY OF STATE IS DIRECTED TO  MAIL  COPIES
OF  PROCESS, BY FILING A CERTIFICATE TO THAT EFFECT EXECUTED, SIGNED AND
ACKNOWLEDGED IN LIKE MANNER AS A CERTIFICATE OF  DESIGNATION  AS  HEREIN
PROVIDED.  SERVICE  OF  PROCESS  UPON  ANY  SUCH CORPORATION OR UPON ANY
CORPORATION HAVING  A  CERTIFICATE  OF  AUTHORITY  UNDER  SECTION  EIGHT
HUNDRED FIVE OF THE LIMITED LIABILITY COMPANY LAW OR HAVING AUTHORITY TO
DO  BUSINESS  BY VIRTUE OF SECTION THIRTEEN HUNDRED FIVE OF THE BUSINESS
CORPORATION LAW, IN ANY ACTION COMMENCED AT ANY  TIME  PURSUANT  TO  THE
PROVISIONS  OF  THIS  SUBCHAPTER,  MAY BE MADE BY EITHER: (A) PERSONALLY
DELIVERING TO AND LEAVING WITH THE SECRETARY OF STATE, A  DEPUTY  SECRE-
TARY OF STATE OR WITH ANY PERSON AUTHORIZED BY THE SECRETARY OF STATE TO
RECEIVE  SUCH  SERVICE  DUPLICATE  COPIES  THEREOF  AT THE OFFICE OF THE
DEPARTMENT OF STATE IN THE CITY OF ALBANY, IN WHICH EVENT THE  SECRETARY
OF  STATE  SHALL  FORTHWITH  SEND  BY  REGISTERED  MAIL,  RETURN RECEIPT
REQUESTED, ONE OF SUCH COPIES TO THE CORPORATION AT THE  ADDRESS  DESIG-
NATED  BY  IT  OR AT ITS LAST KNOWN OFFICE ADDRESS WITHIN OR WITHOUT THE
STATE, OR (B) PERSONALLY DELIVERING TO AND LEAVING WITH THE SECRETARY OF
STATE, A DEPUTY SECRETARY OF STATE OR WITH ANY PERSON AUTHORIZED BY  THE
SECRETARY OF STATE TO RECEIVE SUCH SERVICE, A COPY THEREOF AT THE OFFICE
OF  THE  DEPARTMENT  OF  STATE IN THE CITY OF ALBANY AND BY DELIVERING A
COPY THEREOF TO, AND LEAVING SUCH COPY WITH, THE PRESIDENT,  VICE-PRESI-
DENT, SECRETARY, ASSISTANT SECRETARY, TREASURER, ASSISTANT TREASURER, OR
CASHIER  OF  SUCH  CORPORATION,  OR THE OFFICER PERFORMING CORRESPONDING
FUNCTIONS UNDER ANOTHER NAME, OR A DIRECTOR OR MANAGING  AGENT  OF  SUCH
CORPORATION,  PERSONALLY  WITHOUT  THE  STATE.    PROOF OF SUCH PERSONAL
SERVICE WITHOUT THE STATE SHALL BE FILED WITH THE CLERK OF THE COURT  IN
WHICH  THE  ACTION IS PENDING WITHIN THIRTY DAYS AFTER SUCH SERVICE, AND
SUCH SERVICE SHALL BE COMPLETE TEN DAYS AFTER PROOF THEREOF IS FILED.
  S 11-660 LIMITATIONS OF TIME. THE PROVISIONS OF THE CIVIL PRACTICE LAW
AND RULES RELATIVE TO THE LIMITATION OF TIME ENFORCING  A  CIVIL  REMEDY
SHALL  NOT  APPLY  TO  ANY PROCEEDING OR ACTION TAKEN TO LEVY, APPRAISE,
ASSESS, DETERMINE OR ENFORCE  THE  COLLECTION  OF  ANY  TAX  OR  PENALTY
PRESCRIBED BY THIS SUBCHAPTER, PROVIDED, HOWEVER, THAT AS TO REAL ESTATE
IN  THE  HANDS OF PERSONS WHO ARE OWNERS THEREOF WHO WOULD BE PURCHASERS
IN GOOD FAITH BUT FOR SUCH TAX OR PENALTY AND AS TO  THE  LIEN  ON  REAL
ESTATE OF MORTGAGES HELD BY PERSONS WHO WOULD BE HOLDERS THEREOF IN GOOD
FAITH  BUT  FOR  SUCH TAX OR PENALTY, ALL SUCH TAXES AND PENALTIES SHALL

S. 4610--A                         78                         A. 6721--A

CEASE TO BE A LIEN ON SUCH REAL ESTATE AS  AGAINST  SUCH  PURCHASERS  OR
HOLDERS  AFTER  THE  EXPIRATION  OF  TEN  YEARS FROM THE DATE SUCH TAXES
BECAME DUE AND PAYABLE. THE LIMITATIONS HEREIN PROVIDED  FOR  SHALL  NOT
APPLY TO ANY TRANSFER FROM A CORPORATION TO A PERSON OR CORPORATION WITH
INTENT  TO  AVOID  PAYMENT  OF  ANY TAXES, OR WHERE WITH LIKE INTENT THE
TRANSFER IS MADE TO A GRANTEE CORPORATION,  OR  ANY  SUBSEQUENT  GRANTEE
CORPORATION,  CONTROLLED  BY  SUCH GRANTOR OR WHICH HAS ANY COMMUNITY OF
INTEREST WITH IT, EITHER THROUGH STOCK OWNERSHIP OR OTHERWISE.
  S 2. Subparagraph (A) of paragraph 2 of  subdivision  (f)  of  section
11-508  of  the administrative code of the city of New York, as added by
chapter 485 of the laws of 1994, is amended to read as follows:
  (A) In the case of an issuer or obligor subject to tax under  subchap-
ter  two OR THREE-A of chapter six of this title, or subject to tax as a
utility corporation under chapter eleven of  this  title,  the  issuer's
allocation percentage shall be the percentage of the appropriate measure
(as  defined  hereinafter)  which is required to be allocated within the
city on the report or reports, if any, required of the issuer or obligor
under chapter six or eleven of this title for the  preceding  year.  The
appropriate  measure  referred to in the preceding sentence shall be: in
the case of an issuer or obligor subject to subchapter two OR THREE-A of
chapter six of this title, entire capital; and in the case of an  issuer
or  obligor  subject to chapter eleven of this title as a utility corpo-
ration, gross income.
  S 3. The administrative code of the city of New  York  is  amended  by
adding a new section 11-602.1 to read as follows:
  S 11-602.1 APPLICATION OF THIS SUBCHAPTER. 1. FOR TAXABLE YEARS BEGIN-
NING  ON  OR  AFTER JANUARY FIRST, TWO THOUSAND FIFTEEN, THE TAX IMPOSED
UNDER THIS SUBCHAPTER SHALL ONLY APPLY TO A CORPORATION THAT (A) HAS  AN
ELECTION  IN  EFFECT  UNDER  SUBSECTION  (A) OF SECTION THIRTEEN HUNDRED
SIXTY-TWO OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED, OR (B) IS  A
QUALIFIED  SUBCHAPTER S SUBSIDIARY WITHIN THE MEANING OF PARAGRAPH THREE
OF SUBSECTION (B) OF SECTION THIRTEEN HUNDRED SIXTY-ONE OF THE  INTERNAL
REVENUE CODE OF 1986, AS AMENDED.
  2. FOR TAXABLE YEARS BEGINNING ON OR AFTER JANUARY FIRST, TWO THOUSAND
FIFTEEN,  THE  TAX  IMPOSED  UNDER  THIS SUBCHAPTER SHALL NOT APPLY TO A
CORPORATION THAT IS NOT DESCRIBED IN SUBDIVISION  ONE  OF  THIS  SECTION
EXCEPT TO THE EXTENT PROVIDED IN SUBCHAPTER THREE-A OF THIS CHAPTER.
  3.  CROSS-REFERENCE.  FOR  THE  TAXATION  OF CORPORATIONS THAT ARE NOT
DESCRIBED IN SUBDIVISION ONE OF THIS SECTION, THAT  WERE  TAXABLE  UNDER
THIS  SUBCHAPTER FOR TAX YEARS BEGINNING BEFORE JANUARY FIRST, TWO THOU-
SAND FIFTEEN, SEE SUBCHAPTER THREE-A OF THIS CHAPTER.
  S 4. Subdivision (a) of section 11-639 of the administrative  code  of
the city of New York is amended to read as follows:
  (a) (1) For the privilege of doing business in the city in a corporate
or  organized  capacity,  a  tax,  computed under section 11-643 of this
part, is hereby annually imposed on every banking corporation  for  each
of its taxable years, or any part thereof, beginning on or after January
first,  nineteen  hundred  seventy-three  AND  BEFORE JANUARY FIRST, TWO
THOUSAND FIFTEEN.
  (2) FOR THE PRIVILEGE OF DOING BUSINESS IN THE CITY IN A CORPORATE  OR
ORGANIZED  CAPACITY,  A TAX, COMPUTED UNDER SECTION 11-643 OF THIS PART,
IS HEREBY ANNUALLY IMPOSED ON EVERY BANKING CORPORATION FOR EACH TAXABLE
YEAR, OR ANY PART THEREOF, COMMENCING ON OR  AFTER  JANUARY  FIRST,  TWO
THOUSAND  FIFTEEN, WHERE SUCH BANKING CORPORATION (I) HAS AN ELECTION IN
EFFECT UNDER SUBSECTION (A) OF SECTION THIRTEEN HUNDRED SIXTY-TWO OF THE
INTERNAL REVENUE CODE OF 1986,  AS  AMENDED,  OR  (II)  IS  A  QUALIFIED

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SUBCHAPTER  S  SUBSIDIARY  WITHIN  THE  MEANING  OF  PARAGRAPH  THREE OF
SUBSECTION (B) OF SECTION THIRTEEN HUNDRED  SIXTY-ONE  OF  THE  INTERNAL
REVENUE CODE OF 1986, AS AMENDED.
  S 5. Section 11-639 of the administrative code of the city of New York
is amended by adding a new subdivision (d) to read as follows:
  (D)  CROSS-REFERENCE.  FOR  THE  TAXATION OF CORPORATIONS THAT ARE NOT
DESCRIBED IN PARAGRAPH TWO OF SUBDIVISION (A) OF THIS SECTION, THAT WERE
TAXABLE UNDER THIS SUBCHAPTER FOR TAX  YEARS  BEGINNING  BEFORE  JANUARY
FIRST, TWO THOUSAND FIFTEEN, SEE SUBCHAPTER THREE-A OF THIS CHAPTER.
  S  6. Paragraph 2 of subdivision (b) of section 11-641 of the adminis-
trative code of the city of New York, as amended by chapter 525  of  the
laws of 1988, is amended to read as follows:
  (2)  taxes  on or measured by income or profits paid or accrued within
the taxable year to the United States, or any of its possessions  or  to
any  foreign country and taxes imposed under article nine, nine-A, thir-
teen-A  or  thirty-two  of  the  tax  law  AS  IN  EFFECT  ON   DECEMBER
THIRTY-FIRST,  TWO THOUSAND FOURTEEN and any tax imposed under this part
or subchapter two OR THREE-A of this chapter;
  S 7. Subdivision 1 and paragraph  (a)  of  subdivision  2  of  section
11-671 of the administrative code of the city of New York are amended to
read as follows:
  1.  General.  The  provisions  of  this  subchapter shall apply to the
administration of and the procedures with respect to the  taxes  imposed
by subchapters two, three, THREE-A and four of this chapter.
  (a)  the  term  "named  subchapters"  means  subchapters two, three OR
THREE-A and four of this chapter;
  S 8. Paragraph (a) of subdivision 5 and subdivisions 7,  8  and  9  of
section 11-672 of the administrative code of the city of New York, para-
graph  (a)  of  subdivision  5  as amended by chapter 525 of the laws of
1988, and paragraph (b) of subdivision 9 as amended by  chapter  808  of
the laws of 1992, are amended to read as follows:
  (a) If the taxpayer fails to comply with subchapter two [or], three OR
THREE-A of this chapter in not reporting a change or correction or rene-
gotiation,  or  computation  or  recomputation  of  tax,  increasing  or
decreasing its federal or New York  state  taxable  income,  alternative
minimum  taxable income or other basis of tax as reported on its federal
or New York state income tax return or in  not  reporting  a  change  or
correction  or  renegotiation,  or  computation or recomputation of tax,
which is treated in the same manner as  if  it  were  a  deficiency  for
federal  or  New  York  state  income  tax  purposes or in not filing an
amended return or in not reporting the execution of a notice  of  waiver
executed  pursuant to subsection (d) of section six thousand two hundred
thirteen of the internal revenue code or pursuant to subdivision (f)  of
section  one thousand eighty-one of the tax law, instead of the mode and
time of assessment provided for in subdivision two of this section,  the
commissioner  of  finance  may  assess  a  deficiency  based  upon  such
increased or decreased federal or New York state taxable income,  alter-
native  minimum  taxable  income or other basis of tax by mailing to the
taxpayer a notice of additional tax due specifying  the  amount  of  the
deficiency,  and  such deficiency, together with the interest, additions
to tax and penalties stated in such notice, shall be deemed assessed  on
the date such notice is mailed unless within thirty days after the mail-
ing  of  such notice a report of the federal or New York state change or
correction or renegotiation, or computation or recomputation of tax,  or
an  amended  return,  where  such  return was required by subchapter two
[or], three OR THREE-A, is filed  accompanied  by  a  statement  showing

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wherein  such federal or New York state determination and such notice of
additional tax due are erroneous.
  7.  Two  or  more  corporations.  In  case  of a combined return under
subchapter two OR THREE-A or  a  consolidated  return  under  subchapter
three  of  two  or  more  corporations,  the commissioner of finance may
determine a deficiency of tax  under  subchapter  two  [or  subchapter],
three OR THREE-A of this chapter with respect to the entire tax due upon
such  return  against  any  taxpayer  included therein. In the case of a
taxpayer which might have been included in such a return under  subchap-
ter  two  [or subchapter], three OR THREE-A of this chapter when the tax
was originally reported, the commissioner of  finance  may  determine  a
deficiency  of  tax  under subchapter two [or], three OR THREE-A of this
chapter against such taxpayer and  against  any  other  taxpayers  which
might have been included in such a return.
  8.  Deficiency  defined.  For the purposes of this subchapter, a defi-
ciency means the amount of the tax imposed by the named subchapters,  or
any  of  them, less: (a) the amount shown as the tax upon the taxpayer's
return (whether the return was made or the tax computed by it or by  the
commissioner  of  finance), and less (b) the amounts previously assessed
(or collected without assessment) as  a  deficiency  and  plus  (c)  the
amount  of  any  rebates.  For  the  purpose of this definition, the tax
imposed by subchapter two [or], three OR THREE-A of this chapter and the
tax shown on the return shall both be determined without regard  to  any
payment  of  estimated  tax; and a rebate means so much of an abatement,
credit, refund or other repayment (whether or not erroneous) as was made
on the ground that the amounts entering into the definition of  a  defi-
ciency showed a balance in favor of the taxpayer.
  9.  Exception where change or correction of sales and compensating use
tax liability is not reported.
  (a) If a taxpayer fails to comply with subchapter two  OR  THREE-A  of
this  chapter  in  not reporting a change or correction of its sales and
compensating use tax liability or in not filing a  copy  of  an  amended
return  or report relating to its sales and compensating use tax liabil-
ity, instead of the mode and time of assessment provided for in subdivi-
sion two of this section, the commissioner of finance may assess a defi-
ciency based upon such changed or corrected sales and  compensating  use
tax  liability,  as same relates to credits claimed under subchapter two
OR THREE-A of this chapter, by mailing to the taxpayer a notice of addi-
tional tax due specifying the amount of the deficiency, and  such  defi-
ciency, together with the interest, additions to tax and penalties stat-
ed  in  such notice, shall be deemed assessed on the date such notice is
mailed unless within thirty days after the  mailing  of  such  notice  a
report  of the state change or correction or a copy of an amended return
or report, where such copy was required by subchapter two OR THREE-A, is
filed accompanied by a statement showing  wherein  such  state  determi-
nation and such notice of additional tax due are erroneous.
  (b)  Such notice shall not be considered as a notice of deficiency for
the purposes of this section, subdivision six of section 11-678  (limit-
ing  credits  or refunds after petition to the tax appeals tribunal), or
subdivision two of section 11-680 (authorizing the filing of a  petition
with  the  tax  appeals  tribunal  based on a notice of deficiency), nor
shall such assessment or the collection thereof  be  prohibited  by  the
provisions of subdivision three of this section.
  (c)  If  the  taxpayer has terminated its existence, a notice of addi-
tional tax due may be mailed to its last known address in or out of  the
city,  and such notice shall be sufficient for purposes of this subchap-

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ter. If the commissioner of finance has received notice that a person is
acting for the taxpayer in a fiduciary capacity, a copy of  such  notice
shall also be mailed to the fiduciary named in such notice.
  S 9. Subdivisions 1 and 3 of section 11-673 of the administrative code
of the city of New York, the first undesignated paragraph of subdivision
1  as amended by chapter 808 of the laws of 1992, are amended to read as
follows:
  1. Assessment date. The amount of tax which a return shows to be  due,
or the amount of tax which a return would have shown to be due but for a
mathematical error, shall be deemed to be assessed on the date of filing
of the return (including any amended return showing an increase of tax).
If  a notice of deficiency has been mailed, the amount of the deficiency
shall be deemed to be assessed on the date specified in subdivision  two
of  section  11-672  of this subchapter if no petition is both served on
the commissioner of finance and filed with the tax appeals tribunal,  or
if a petition is so served and filed, then upon the date when a decision
of  the  tax  appeals tribunal establishing the amount of the deficiency
becomes final. If a report  or  an  amended  return  filed  pursuant  to
subchapter two [or], three OR THREE-A of this chapter concedes the accu-
racy  of  a federal or New York state adjustment or change or correction
or renegotiation or computation or recomputation of tax, any  deficiency
in  tax  under  subchapter  two  [or],  three OR THREE-A of this chapter
resulting therefrom shall be deemed to be assessed on the date of filing
such report or amended return,  and  such  assessment  shall  be  timely
notwithstanding section 11-674 of this chapter.
  If  a report filed pursuant to subchapter two OR THREE-A of this chap-
ter concedes the accuracy of a state change or correction of  sales  and
compensating  use  tax liability, any deficiency in tax under subchapter
two OR THREE-A of this  chapter  resulting  therefrom  shall  be  deemed
assessed on the date of filing such report, and such assessment shall be
timely notwithstanding section 11-674 of this chapter.
  If  a  notice of additional tax due, as prescribed in subdivision five
of section 11-672 of this chapter, has been mailed, the  amount  of  the
deficiency  shall be deemed to be assessed on the date specified in such
subdivision unless within thirty days after the mailing of such notice a
report of the  federal  or  New  York  state  adjustment  or  change  or
correction  or  renegotiation or computation or recomputation of tax, or
an amended return, where such return  was  required  by  subchapter  two
[or], three OR THREE-A of this chapter, is filed accompanied by a state-
ment  showing  wherein  such federal or New York state determination and
such notice of additional tax due are erroneous.
  If a notice of additional tax due, as prescribed in  subdivision  nine
of section 11-672 of this subchapter, has been mailed, the amount of the
deficiency  shall be deemed to be assessed on the date specified in such
subdivision unless within thirty days after the mailing of such notice a
report of the state change or correction, or a copy of an amended return
or report, where such copy was required by subchapter two OR THREE-A  of
this  chapter,  is filed accompanied by a statement showing wherein such
state determination and such notice of additional tax due are erroneous.
  Any amount paid as a tax or in respect of a tax,  other  than  amounts
paid  as  estimated tax, shall be deemed to be assessed upon the date of
receipt of payment notwithstanding any other provisions.
  3. Estimated tax. No unpaid amount of estimated tax  under  subchapter
two [or], three OR THREE-A of this chapter shall be assessed.
  S  10.  Subdivisions  3  and 4 of section 11-674 of the administrative
code of the city of New York, subparagraph 3 of paragraph (a) and  para-

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graph (c) of subdivision 3 as amended by chapter 525 of the laws of 1988
and  paragraph (d) of subdivision 3 as amended by local law number 57 of
the city of New York for the year 2001, are amended to read as follows:
  3. Exceptions.
  (a) Assessment at any time. The tax may be assessed at any time if:
  (1) no return is filed,
  (2) a false or fraudulent return is filed with intent to evade tax,
  (3) in the case of the tax imposed under subchapter two [or], three OR
THREE-A  of this chapter, the taxpayer fails to file a report or amended
return required thereunder, in respect of an  increase  or  decrease  in
federal  or  New  York state taxable income, alternative minimum taxable
income or other basis of tax or federal or New York  state  tax,  or  in
respect  of a change or correction or renegotiation or in respect of the
execution of a notice of waiver report of which is required  thereunder,
or  computation  or  recomputation  of tax, which is treated in the same
manner as if it were a deficiency for federal or New York  state  income
tax purposes, or
  (4)  in the case of the tax imposed under subchapter two OR THREE-A of
this chapter, the taxpayer fails to file a report or amended  return  or
report  required  thereunder,  in  respect  of a change or correction of
sales and compensating use tax liability, relating to  the  purchase  or
use  of  items  for which a sales or compensating use tax credit against
the tax imposed by subchapter two OR THREE-A was claimed.
  (b) Extension by agreement. Where, before the expiration of  the  time
prescribed  in  this section for the assessment of tax, both the commis-
sioner of finance and the taxpayer have  consented  in  writing  to  its
assessment after such time, the tax may be assessed at any time prior to
the  expiration of the period agreed upon. The period so agreed upon may
be extended by subsequent agreements in writing made before the  expira-
tion of the period previously agreed upon.
  (c)  Report  of federal or New York state change or correction. In the
case of the tax imposed under subchapter two [or], three OR  THREE-A  of
this  chapter, if the taxpayer files a report or amended return required
thereunder, in respect of an increase or decrease in federal or New York
state taxable income, alternative minimum taxable income or other  basis
of  tax  or  federal or New York state tax, or in respect of a change or
correction or renegotiation, or in respect of the execution of a  notice
of  waiver  report  of  which  is required thereunder, or computation or
recomputation of tax, which is treated in the same manner as if it  were
a  deficiency  for  federal  or  New York state income tax purposes, the
assessment (if not deemed to have been  made  upon  the  filing  of  the
report or amended return) may be made at any time within two years after
such  report  or amended return was filed. The amount of such assessment
of tax shall not exceed the amount of the increase in city tax attribut-
able to such federal or New York state change or correction or renegoti-
ation, or computation or recomputation of tax. The  provisions  of  this
paragraph shall not affect the time within which or the amount for which
an assessment may otherwise be made.
  (d)  Deficiency  attributable  to  carry  back. If a deficiency of tax
under subchapter two OR THREE-A of this chapter is attributable  to  the
application  to taxpayer of a net operating loss carry back or a capital
loss carry back, it may be assessed at any time that  a  deficiency  for
the taxable year of the loss may be assessed.
  (e) Recovery of erroneous refund. An erroneous refund shall be consid-
ered  an  underpayment  of  tax on the date made, and an assessment of a
deficiency arising out of an erroneous refund may be made  at  any  time

S. 4610--A                         83                         A. 6721--A

within  two years from the making of the refund, except that the assess-
ment may be made within five years from the making of the refund  if  it
appears that any part of the refund was induced by fraud or misrepresen-
tation of a material fact.
  (f)  Request  for  prompt assessment. The tax shall be assessed within
eighteen months after written request therefor (made after the return is
filed) by the taxpayer or by a fiduciary representing the taxpayer,  but
not  more  than three years after the return was filed, except as other-
wise provided in this subdivision and subdivision four. This subdivision
shall not apply unless:
  (1) (A) such written request notifies the commissioner of finance that
the taxpayer contemplates dissolution at or  before  the  expiration  of
such  eighteen-month  period, (B) the dissolution is in good faith begun
before the expiration of such eighteen-month period, (C) the dissolution
is completed;
  (2) (A) such written request notifies the commissioner of finance that
a dissolution has in good faith been begun, and (B) the  dissolution  is
completed; or
  (3)  a dissolution has been completed at the time such written request
is made.
  (g) Change of the allocation of taxpayer's income or  capital.    [No]
(1)  WITH  REGARD  TO  TAXABLE YEARS BEGINNING BEFORE JANUARY FIRST, TWO
THOUSAND FIFTEEN, NO change of the allocation of income or capital  upon
which  the  taxpayer's  return  (or any additional assessment) was based
shall be made where an assessment of tax is made during  the  additional
period  of limitation under subparagraph three or four of paragraph (a),
or under paragraph (c), (d) or (i); and where any  such  assessment  has
been  made,  or  where  a  notice  of  deficiency has been mailed to the
taxpayer on the basis of any such proposed assessment, no change of  the
allocation  of  income  or  capital shall be made in a proceeding on the
taxpayer's claim for refund of such  assessment  or  on  the  taxpayer's
petition for redetermination of such deficiency.
  (2)  WITH REGARD TO TAXABLE YEARS BEGINNING ON OR AFTER JANUARY FIRST,
TWO THOUSAND FIFTEEN, NO CHANGE OF THE ALLOCATION OF INCOME  OR  CAPITAL
UPON  WHICH  THE  TAXPAYER'S  RETURN  (OR ANY ADDITIONAL ASSESSMENT) WAS
BASED SHALL BE MADE WHERE AN ASSESSMENT OF TAX IS MADE DURING THE  ADDI-
TIONAL  PERIOD  OF  LIMITATION UNDER SUBPARAGRAPH THREE OR FOUR OF PARA-
GRAPH (A) OR UNDER PARAGRAPH (C), (D) OR (I), EXCEPT TO THE EXTENT  SUCH
ASSESSMENT IS BASED ON AN INCREASE OR DECREASE IN NEW YORK STATE TAXABLE
INCOME  OR  OTHER  BASIS  OF  TAX  OR  NEW YORK STATE TAX, OR BASED ON A
CHANGE, CORRECTION OR RENEGOTIATION OF TAX, OR BASED ON THE EXECUTION OF
A NOTICE OF WAIVER REPORT WHICH IS REQUIRED THEREUNDER,  OR  COMPUTATION
OR  RECOMPUTATION  OF  TAX, WHICH IS TREATED IN THE SAME MANNER AS IF IT
WERE A DEFICIENCY FOR NEW YORK STATE INCOME TAX PURPOSES; AND WHERE  ANY
SUCH  ASSESSMENT HAS BEEN MADE, OR WHERE A NOTICE OF DEFICIENCY HAS BEEN
MAILED TO THE TAXPAYER ON THE BASIS OF ANY SUCH PROPOSED ASSESSMENT,  NO
CHANGE  OF  THE  ALLOCATION  OF  INCOME  OR  CAPITAL  SHALL BE MADE IN A
PROCEEDING ON THE TAXPAYER'S CLAIM FOR REFUND OF SUCH ASSESSMENT  OR  ON
THE  TAXPAYER'S  PETITION FOR REDETERMINATION OF SUCH DEFICIENCY, EXCEPT
TO THE EXTENT SUCH ASSESSMENT IS BASED ON AN INCREASE OR DECREASE IN NEW
YORK STATE TAXABLE INCOME OR OTHER BASIS OF TAX OR NEW YORK  STATE  TAX,
OR  BASED ON A CHANGE OR CORRECTION OR RENEGOTIATION OF TAX, OR BASED ON
THE EXECUTION OF A NOTICE OF WAIVER REPORT WHICH IS REQUIRED THEREUNDER,
OR COMPUTATION OR RECOMPUTATION OF TAX, WHICH IS  TREATED  IN  THE  SAME
MANNER  AS  IF  IT  WERE  AN  OVERPAYMENT  FOR NEW YORK STATE INCOME TAX
PURPOSES.

S. 4610--A                         84                         A. 6721--A

  (h) Report concerning waste  treatment  facility.  Under  the  circum-
stances  described in subparagraph three of paragraph (g) of subdivision
eight of section 11-602 of this chapter  OR  IN  SUBPARAGRAPH  THREE  OF
PARAGRAPH  (G)  OF  SUBDIVISION EIGHT OF SECTION 11-652 OF THIS CHAPTER,
the  tax  may  be  assessed  within  three years after the filing of the
report containing the information required by such paragraph.
  (i) Report of changed or corrected  sales  and  compensating  use  tax
liability.  In the case of a tax imposed under subchapter two OR THREE-A
of this chapter, if the taxpayer files a report  or  amended  return  or
report  required  thereunder,  in  respect  of a change or correction of
sales and compensating use tax liability, the assessment (if not  deemed
to have been made upon the filing of the report) may be made at any time
within  two  years  after  such  report  or amended return or report was
filed. The amount of such assessment of tax shall not exceed the  amount
of  the  increase  in  city  tax  attributable  to  such state change or
correction.  The provisions of this paragraph shall not affect the  time
within  which  or  the  amount  for which an assessment may otherwise be
made.
  4. Omission of income on return. The tax may be assessed at  any  time
within  six  years  after  the return was filed if a taxpayer omits from
gross income required to be reported on a return under any of the  named
subchapters  an amount properly includable therein which is in excess of
twenty-five per centum of the amount  of  gross  income  stated  in  the
return.
  For the purposes of this subdivision:
  (a)  the term "gross income" means gross income for federal income tax
purposes as reportable on a return under subchapter two  OR  THREE-A  of
this  chapter  and  "gross  earnings",  "gross income," "gross operating
income" and "gross direct premiums less return premiums," as those terms
are used in whichever of the named subchapters is applicable;
  (b) there shall not be taken into account any amount which is  omitted
in  the return if such amount is disclosed in the return, or in a state-
ment attached to the return, in a manner adequate to apprise the commis-
sioner of finance of the nature and amount of such item.
  S 11. Subdivisions 2 and 5 of section  11-675  of  the  administrative
code  of  the  city  of  New York, subdivision 5 as amended by local law
number 57 of the city of New York for the year 2001, are amended to read
as follows:
  2. Exception as to estimated tax. This section shall not apply to  any
failure to pay estimated tax under subchapter two [or subchapter], three
OR THREE-A of this chapter.
  5.  Tax  reduced  by carry back. If the amount of tax under subchapter
two OR THREE-A for any taxable year is reduced by reason of a  carryback
of  a  net operating loss or a capital loss, such reduction in tax shall
not affect the computation of interest under this section for the period
ending with the filing date for the taxable year in which the net  oper-
ating  loss or capital loss arises. Such filing date shall be determined
without regard to extensions of time to file.
  S 12. Subdivision 3 of section 11-676 of the  administrative  code  of
the  city of New York, as amended by chapter 201 of the laws of 2009, is
amended to read as follows:
  3. Failure to file declaration or underpayment of  estimated  tax.  If
any taxpayer fails to file a declaration of estimated tax under subchap-
ter  two  [or], three OR THREE-A of this chapter, or fails to pay all or
any part of an amount which is applied as an  installment  against  such
estimated  tax, it shall be deemed to have made an underpayment of esti-

S. 4610--A                         85                         A. 6721--A

mated tax. There shall be added to the  tax  for  the  taxable  year  an
amount  at  the  underpayment  rate  set  by the commissioner of finance
pursuant to section 11-687 of this subchapter, or, if no rate is set, at
the  rate of seven and one-half percent per annum upon the amount of the
underpayment for the period of  the  underpayment  but  not  beyond  the
fifteenth  day  of  the  third  month following the close of the taxable
year. The amount of the underpayment  shall  be,  with  respect  to  any
installment  of  estimated  tax  computed  on the basis of the preceding
year's tax, the excess of the  amount  required  to  be  paid  over  the
amount,  if  any,  paid  on  or  before the last day prescribed for such
payment or, with respect to any other installment of estimated tax,  the
excess  of  the  amount of the installment which would be required to be
paid if the estimated tax were equal to ninety percent of the tax  shown
on  the  return  for the taxable year (or if no return was filed, ninety
percent of the tax for such year)  over  the  amount,  if  any,  of  the
installment  paid on or before the last day prescribed for such payment.
In any case in which there would be no underpayment if "eighty  percent"
were  substituted  for  "ninety  percent"  each place it appears in this
subdivision, the addition to the tax  shall  be  equal  to  seventy-five
percent  of  the  amount  otherwise determined. No underpayment shall be
deemed to exist with respect to a declaration or  installment  otherwise
due on or after the termination of existence of the taxpayer.
  S  13. The opening paragraph of subdivision 4 of section 11-676 of the
administrative code of the city of  New  York  is  amended  to  read  as
follows:
  The addition to tax under subdivision three with respect to any under-
payment  of  any amount which is applied as an installment against esti-
mated tax under subchapter two [or], three OR THREE-A  of  this  chapter
shall  not  be  imposed if the total amount of all payments of estimated
tax made on or before the last date prescribed for the  payment  of  any
such  amount equals or exceeds the amount which would have been required
to be paid on or before such date if the estimated tax were whichever of
the following is the least:
  S 14. Subdivision 13 of section 11-676 of the administrative  code  of
the  city  of  New York, as added by chapter 525 of the laws of 1988, is
amended to read as follows:
  13. Failure to file report of information relating to certain interest
payments. In case of failure to file the report of information  required
under  EITHER  subdivision  two-a  of  section 11-605 of this chapter OR
SUBDIVISION TWO-A OF SECTION 11-655 OF THIS CHAPTER, unless it is  shown
that  such  failure  is  due  to reasonable cause and not due to willful
neglect, there shall be added to the  tax  a  penalty  of  five  hundred
dollars.
  S  15.  Subdivision  2 of section 11-677 of the administrative code of
the city of New York is amended to read as follows:
  2. Credits against estimated tax.  The  commissioner  of  finance  may
prescribe  regulations providing for the crediting against the estimated
tax under subchapter two [or], three OR THREE-A of this chapter for  any
taxable  year of the amount determined to be an overpayment of tax under
any such subchapter for a preceding taxable year. If any overpayment  of
tax  is  so claimed as a credit against estimated tax for the succeeding
taxable year, such amount shall be considered as a payment  of  the  tax
under  subchapter  two  [or],  three  OR THREE-A of this chapter for the
succeeding taxable year (whether or not  claimed  as  a  credit  in  the
declaration  of  estimated tax for such succeeding taxable year), and no

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claim for credit or refund of such overpayment shall be allowed for  the
taxable year for which the overpayment arises.
  S 16. Subdivisions 3, 4, 9 and 11 of section 11-678 of the administra-
tive  code  of the city of New York, subdivision 3 as amended by chapter
241 of the laws of 1989 and subdivision 4 as amended by local law number
57 of the city of New York for the year 2001, are  amended  to  read  as
follows:
  3.  Notice of change or correction of federal or New York state income
or other basis of tax. If a taxpayer is required by subchapter two [or],
three OR THREE-A of this chapter to file a report or amended  return  in
respect of (a) a decrease or increase in federal or New York state taxa-
ble  income, alternative minimum taxable income or other basis of tax or
federal or New York state tax, (b) a federal or New York state change or
correction or renegotiation, or computation  or  recomputation  of  tax,
which  is  treated  in  the same manner as if it were an overpayment for
federal or New York state income  tax  purposes,  claim  for  credit  or
refund of any resulting overpayment of tax shall be filed by the taxpay-
er  within  two  years  from  the time such report or amended return was
required to be filed with the commissioner of finance. If the report  or
amended return required by subchapter two [or], three OR THREE-A of this
chapter  is not filed within the ninety day period therein specified, no
interest shall be payable on any claim for credit or refund of the over-
payment attributable  to  the  federal  or  New  York  state  change  or
correction. The amount of such credit or refund:
  (c)  shall,  (I) FOR TAXABLE YEARS BEGINNING BEFORE JANUARY FIRST, TWO
THOUSAND FIFTEEN, be computed without change of the allocation of income
or capital upon which the taxpayer's return (or any  additional  assess-
ment) was based, and, (II) FOR TAXABLE YEARS BEGINNING ON OR AFTER JANU-
ARY FIRST, TWO THOUSAND FIFTEEN, BE COMPUTED WITHOUT CHANGE OF THE ALLO-
CATION  OF  INCOME  OR  CAPITAL UPON WHICH THE TAXPAYER'S RETURN (OR ANY
ADDITIONAL ASSESSMENT) WAS BASED TO THE EXTENT THAT THE CLAIM FOR REFUND
ARISES FROM A DECREASE OR INCREASE IN FEDERAL TAXABLE  INCOME  OR  OTHER
BASIS OF TAX OR FEDERAL TAX, OR FROM A FEDERAL CHANGE, CORRECTION, RENE-
GOTIATION,  COMPUTATION OR RECOMPUTATION OF TAX, WHICH IS TREATED IN THE
SAME MANNER AS  IF  IT  WERE  AN  OVERPAYMENT  FOR  FEDERAL  INCOME  TAX
PURPOSES, AND
  (d)  shall  not exceed the amount of the reduction in tax attributable
to such decrease or increase  in  federal  or  New  York  state  taxable
income,  alternative  minimum  taxable  income  or other basis of tax or
federal or New York state tax or to  such  federal  or  New  York  state
change  or  correction or renegotiation, or computation or recomputation
of tax.
  This subdivision shall not affect the time within which or the  amount
for  which  a  claim  for  credit or refund may be filed apart from this
subdivision.
  4. Overpayment attributable to net operating loss carry back or  capi-
tal loss carry back. A claim for credit or refund of so much of an over-
payment  under subchapter two OR THREE-A of this chapter as is attribut-
able to the application to the taxpayer of a net  operating  loss  carry
back or a capital loss carry back shall be filed within three years from
the time the return was due (including extensions thereof) for the taxa-
ble year of the loss, or within the period prescribed in subdivision two
in  respect  of  such  taxable  year, or within the period prescribed in
subdivision three, where applicable, in respect to the taxable  year  to
which  the net operating loss or capital loss is carried back, whichever
expires the latest. Where such claim for credit or refund is filed after

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the expiration of the period prescribed in subdivision one or in  subdi-
vision two where applicable, in respect to the taxable year to which the
net  operating  loss or capital loss is carried back, the amount of such
credit  or  refund shall be computed without change of the allocation of
income or capital upon which the taxpayer's return  (or  any  additional
assessment) was based.
  9.  Prepaid  tax.  For  purposes  of this section, any tax paid by the
taxpayer before the last day prescribed for its payment  (including  any
amount  paid  by the taxpayer as estimated tax for a taxable year) shall
be deemed to have been paid by it on the  fifteenth  day  of  the  third
month following the close of the taxable year the income of which is the
basis  for tax under subchapter two [or], three OR THREE-A of this chap-
ter, or on the last day prescribed in part one of  subchapter  three  or
subchapter  four for the filing of a final return for such taxable year,
or portion thereof, determined in all cases without regard to any exten-
sion of time granted the taxpayer.
  11. Notice of change or correction of sales and compensating  use  tax
liability. (a) If a taxpayer is required by subchapter two OR THREE-A of
this  chapter  to file a report or amended return in respect of a change
or correction of its sales and compensating use tax liability, claim for
credit or refund of any resulting overpayment of tax shall be  filed  by
the  taxpayer  within  two  years  from  the time such report or amended
return was required to be filed with the commissioner  of  finance.  The
amount  of such credit or refund shall be computed without change of the
allocation of income or capital upon which the taxpayer's return (or any
additional assessment) was based, and shall not exceed the amount of the
reduction in tax attributable to such change or correction of sales  and
compensating use tax liability.
  (b)  This  subdivision  shall  not affect the time within which or the
amount for which a claim for credit or refund may be  filed  apart  from
this subdivision.
  S  17.  Subdivisions  4  and 6 of section 11-679 of the administrative
code of the city of New York, subdivision 4  as  amended  by  local  law
number 57 of the city of New York for the year 2001 and subdivision 6 as
amended  by  chapter  241  of  the  laws of 1989, are amended to read as
follows:
  4. Refund of tax caused by carryback. For purposes of this section, if
any overpayment of tax imposed by subchapter  two  OR  THREE-A  of  this
chapter  results from a carryback of a net operating loss or a net capi-
tal loss, such overpayment shall be deemed not to have been  made  prior
to the filing date for the taxable year in which such net operating loss
or net capital loss arises. Such filing date shall be determined without
regard  to extensions of time to file. For purposes of subdivision three
of this section any overpayment described herein shall be treated as  an
overpayment for the loss year and such subdivision shall be applied with
respect  to such overpayment by treating the return for the loss year as
not filed before claim for such overpayment is  filed.  The  term  "loss
year" means the taxable year in which such loss arises.
  6. Cross reference. For provision with respect to interest after fail-
ure  to  file a report of federal or New York state change or correction
or amended return under subchapter  two  [or],  three  OR  THREE-A,  see
subdivision three of section 11-678 of this subchapter.
  S 18. Paragraph (d) of subdivision 4 of section 11-680 of the adminis-
trative  code  of the city of New York, as amended by chapter 808 of the
laws of 1992, is amended to read as follows:

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  (d) Restriction on further notices  of  deficiency.  If  the  taxpayer
files  a  petition  with the tax appeals tribunal under this section, no
notice of deficiency under section 11-672 of this subchapter may  there-
after  be  issued  by  the  commissioner of finance for the same taxable
year, except in case of fraud or with respect to an increase or decrease
in federal or New York state taxable income, alternative minimum taxable
income  or  other  basis  of  tax  or federal or New York state tax or a
federal or New York state change  or  correction  or  renegotiation,  or
computation or recomputation of tax, which is treated in the same manner
as  if  it  were  a  deficiency for federal or New York state income tax
purposes, required to be reported under subchapter two  [or],  three  OR
THREE-A  of this chapter or with respect to a state change or correction
of sales and compensating use tax  liability  required  to  be  reported
under subchapter two OR THREE-A of this chapter.
  S 19. Paragraph (c) of subdivision 5 of section 11-680 of the adminis-
trative  code  of the city of New York, as amended by chapter 808 of the
laws of 1992, is amended to read as follows:
  (c) whether the petitioner is liable for any increase in a  deficiency
where  such  increase is asserted initially after a notice of deficiency
was mailed and a petition under this section filed, unless such increase
in deficiency is the result of an increase or decrease in federal or New
York state taxable income, alternative minimum taxable income  or  other
basis  of  tax or federal or New York state tax or a federal or New York
state change or correction or renegotiation, or computation or  recompu-
tation of tax, which is treated in the same manner as if it were a defi-
ciency for federal or New York state income tax purposes, required to be
reported  under  subchapter  two [or], three OR THREE-A of this chapter,
and of which increase, decrease, change or correction or  renegotiation,
or  computation  or  recomputation,  the  commissioner of finance had no
notice at the time he or she mailed the notice of deficiency  or  unless
such  increase  in deficiency is the result of a change or correction of
sales and compensating use tax liability required to be  reported  under
subchapter  two  OR  THREE-A  of  this  chapter,  and of which change or
correction the commissioner of finance had no notice at the time  he  or
she mailed the notice of deficiency; and
  S 20. Paragraph (a) of subdivision 5 of section 11-687 of the adminis-
trative  code  of the city of New York, as amended by chapter 201 of the
laws of 2009, is amended to read as follows:
  (a) Authority to set interest rates. The commissioner of finance shall
set the overpayment and underpayment rates of interest to be paid pursu-
ant to sections 11-606, 11-608, 11-645, 11-647, 11-656, 11-658,  11-675,
11-676,  and  11-679  of  this  chapter, but if no such rate or rates of
interest are set, such overpayment rate shall be deemed to be set at six
percent per annum and such underpayment rate shall be deemed to  be  set
at  seven and one-half percent per annum. Such overpayment and underpay-
ment rates shall be the rates prescribed in paragraph (b) of this subdi-
vision but the underpayment rate shall not be less than seven  and  one-
half  percent  per  annum.  Any  such  rates  set by the commissioner of
finance shall apply to taxes, or any portion thereof,  which  remain  or
become  due  or overpaid on or after the date on which such rates become
effective and shall apply only with  respect  to  interest  computed  or
computable  for  periods  or portions of periods occurring in the period
during which such rates are in effect.
  S 21. Subdivision 7 of section 11-688 of the  administrative  code  of
the city of New York, as added by section 22 of part M of chapter 686 of
the laws of 2003, is amended to read as follows:

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  7.  Notwithstanding  anything  in subdivision one of this section, the
commissioner of finance may disclose  to  a  taxpayer  or  a  taxpayer's
related  member,  as  defined  in  paragraph (n) of subdivision eight of
section 11-602, PARAGRAPH (N) OF SUBDIVISION EIGHT OF SECTION 11-652  or
paragraph  one  of  subdivision  (q)  of section 11-641 of this chapter,
information relating to any royalty paid, incurred or received  by  such
taxpayer or related member to or from the other, including the treatment
of  such payments by the taxpayer or the related member in any report or
return transmitted to the commissioner of finance under this title.
  S 22. Paragraph 4 of subdivision (f) of section 11-704 of the adminis-
trative code of the city of New York, as amended by chapter 831  of  the
laws of 1992, is amended to read as follows:
  (4)  No tenant shall be authorized to receive a reduction in base rent
subject to tax under the provisions of this subdivision, until the prem-
ises with respect to which it is claiming a reduction in base rent  meet
the requirements in the definition of eligible premises and until it has
obtained  a  certification  of  eligibility  from the mayor or an agency
designated by the mayor, and an annual certification from the  mayor  or
an agency designated by the mayor as to the number of eligible aggregate
employment  shares  maintained  by  such  tenant  which  may qualify for
obtaining a base rent reduction for the tenant's tax year.  Any  written
documentation submitted to the mayor or such agency or agencies in order
to  obtain  any  such certification shall be deemed a written instrument
for purposes of section 175.00 of the penal law.  Application  fees  for
such  certifications  shall be determined by the mayor or such agency or
agencies. No certification of eligibility shall be issued to an eligible
business on or after July first,  nineteen  hundred  ninety-nine  unless
such  business  meets the requirements of either subparagraph (a) or (b)
below:
  (a) (1) prior to such date such  business  has  purchased,  leased  or
entered  into  a  contract to purchase or lease particular premises or a
parcel on which will be constructed such premises or already owned  such
premises or parcel;
  (2)  prior to such date improvements have been commenced on such prem-
ises or parcel which improvements will meet the requirements of subdivi-
sion (e) of section 22-621 of this code  relating  to  expenditures  for
improvements;
  (3) prior to such date such business submits a preliminary application
for a certification of eligibility to such mayor or such agency or agen-
cies  with respect to a proposed relocation to such particular premises;
and
  (4) such business relocates to such particular premises not later than
thirty-six months or, in a case in which the expenditures made  for  the
improvements  specified in clause two of this subparagraph are in excess
of fifty million dollars within seventy-two  months  from  the  date  of
submission of such preliminary application; or
  (b) (1) not later than June thirtieth, two thousand two, such business
has  purchased,  leased  or entered into a contract to purchase or lease
particular premises wholly contained in a building in which at least  an
aggregate  of  forty  per  centum  or  two hundred thousand square feet,
whichever is less, of the nonresidential floor area of such building has
been purchased or leased by a business or businesses which meet or  will
meet the requirements of subparagraph (a) of this paragraph with respect
to such floor area and which are or will become certified as eligible to
receive  a credit under section 22-622 of this code with respect to such
floor area;

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  (2) not later than June thirtieth, two  thousand  two,  such  business
submits  a preliminary application for a certification of eligibility to
such mayor or such agency or agencies with respect to a  proposed  relo-
cation to such particular premises; and
  (3)  not  later  than  June thirtieth, two thousand two, such business
relocates to such particular premises.
  Any tenant subject to a tax imposed under chapter five, or  subchapter
two  [or],  three  OR  THREE-A of chapter six, of this title obtaining a
certification of eligibility pursuant  to  subdivision  (b)  of  section
22-622 of the code shall be deemed to have obtained the certification of
eligibility required by this paragraph.
  S  23. Subdivision (a) and the opening paragraph of subdivision (o) of
section 22-621 of the administrative code  of  the  city  of  New  York,
subdivision  (a)  as  amended by chapter 149 of the laws of 1999 and the
opening paragraph of subdivision (o) as added by chapter 143 of the laws
of 2004, are amended to read as follows:
  (a) "Eligible Business." Any person subject to  a  tax  imposed  under
chapter  five,  or subchapter two [or], three OR THREE-A of chapter six,
or chapter eleven, of title eleven of  the  code,  that:  (1)  has  been
conducting  substantial  business  operations  at  one  or more business
locations outside the eligible  area  for  the  twenty-four  consecutive
months immediately preceding the taxable year during which such eligible
business  relocates  as  defined in subdivision (j) of this section; and
(2) on or after May twenty-seventh, nineteen hundred eighty-seven  relo-
cates  as defined in subdivision (j) of this section all or part of such
business operations; and (3) either (i) on or after May  twenty-seventh,
nineteen  hundred  eighty-seven first enters into a contract to purchase
or lease the premises to which it relocates as  defined  in  subdivision
(j) of this section, or a parcel on which will be constructed such prem-
ises,  or  (ii)  as of May twenty-seventh, nineteen hundred eighty-seven
owns such parcel or premises and has not prior to such date made  appli-
cation  for  benefits pursuant to part four of subchapter two of chapter
two of title eleven of the code.
  "Total attributed eligible aggregate employment shares" means, for any
relocation, the sum of  the  number  of  eligible  aggregate  employment
shares  apportioned to such relocation pursuant to paragraph one of this
subdivision, less any excess shares  determined  with  respect  to  such
relocation  pursuant  to  paragraph  two  of  this subdivision, plus any
excess shares attributed to such relocation pursuant to paragraph  three
of this subdivision. Except as provided in paragraph four of this subdi-
vision,  any eligible aggregate employment shares that are attributed to
a relocation to particular premises pursuant to paragraph three of  this
subdivision  shall  be  treated  as eligible aggregate employment shares
that are maintained with respect to such premises and shall  be  subject
to  all  provisions  of  this  chapter  and  the provisions for a credit
against a tax imposed under chapter five or subchapter two  [or],  three
OR  THREE-A of chapter six or chapter eleven of title eleven of the code
as such provisions pertain to such relocation.
  S 24. Subdivisions (a) and (d) of section 22-622 of the administrative
code of the city of New York, subdivision (a) as amended and subdivision
(d) as added by chapter 149 of the laws of 1999, are amended to read  as
follows:
  (a)  An eligible business that relocates as defined in subdivision (j)
of section 22-621 of the code shall  be  allowed  to  receive  a  credit
against  a tax imposed by chapter five, or subchapter two [or], three OR
THREE-A of chapter six, or chapter eleven, of title eleven of the  code,

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as described in subdivision (i) of section 11-503, subdivision seventeen
of  section  11-604,  SUBDIVISION  SEVENTEEN  OF SECTION 11-654, section
11-643.7 and section 11-1105.2 of the code, and a reduction in base rent
subject  to  tax  as described in subdivision f of section 11-704 of the
code, provided, however, notwithstanding any other provision of  law  to
the  contrary,  no  such credit shall be allowed against the tax imposed
under such chapter eleven for a relocation taking place prior to January
first, nineteen hundred ninety-nine.
  (d) An eligible business other than a utility company subject  to  the
supervision  of the department of public service shall not be authorized
to receive a credit against the gross receipts tax imposed under chapter
eleven of title eleven of the code, unless such eligible business elects
to take the credit authorized by this section against the tax imposed by
such chapter on an application filed with respect  to  the  first  relo-
cation  of  such  business  that  qualifies  or  will qualify under this
section, with the mayor or the agency designated by such mayor  pursuant
to  subdivision  (b)  of  this  section. The election authorized by this
subdivision may not be withdrawn after  the  issuance  of  such  certif-
ication  of  eligibility.  No  taxpayer  that  has previously received a
certification of eligibility to receive  such  credit  against  any  tax
imposed  by  chapter  five  or  subchapter two [or], three OR THREE-A of
chapter six of title eleven of the code may make the election authorized
by this subdivision. No taxpayer that makes  the  election  provided  in
this subdivision shall be authorized to take such credit against any tax
imposed  by  chapter  five  or  subchapter two [or], three OR THREE-A of
chapter six of title eleven of the code.
  S 25. Subdivisions (a) and (l) of section 22-623 of the administrative
code of the city of New York, subdivision (a) as added by chapter 143 of
the laws of 2004 and subdivision (l) as added by section 10 of part E of
chapter 2 of the laws of 2005, are amended to read as follows:
  (a) "Eligible business" means any person  subject  to  a  tax  imposed
under  chapter five, or subchapter two [or], three OR THREE-A of chapter
six, or chapter eleven, of title eleven of the code, that:
  (1) has been conducting substantial business operations at one or more
business locations outside the city of  New  York  for  the  twenty-four
consecutive  months  immediately preceding the taxable year during which
such eligible business relocates as defined in subdivision (j)  of  this
section but has not maintained employment shares at premises in the city
of  New  York at any time during the period beginning January first, two
thousand two and ending on the date it enters into a lease or a contract
to purchase the premises that will qualify as eligible premises pursuant
to this chapter; and
  (2) on or after July first, two thousand three relocates as defined in
subdivision (j) of this section all or part of such business operations.
  (l) "Special eligible business" means any  person  subject  to  a  tax
imposed  under chapter five, or subchapter two [or], three OR THREE-A of
chapter six, or chapter eleven, of title eleven of the code,  that:  (1)
has been conducting substantial business operations at one or more busi-
ness  locations outside the city of New York for the twenty-four consec-
utive months immediately preceding the taxable year  during  which  such
eligible  business  relocates  as  defined in subdivision (m); (2) main-
tained employment shares at premises in Manhattan in  the  city  of  New
York  at  some time during the period beginning January first, two thou-
sand two, and ending on the date it enters into a lease or a contract to
purchase the premises that will qualify as eligible premises pursuant to
this section, and (3) on or after June  thirtieth,  two  thousand  five,

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relocates  as  defined in subdivision (m) of this section all or part of
such business operations.
  S 26. Subdivisions (a) and (d) of section 22-624 of the administrative
code  of  the city of New York, subdivision (a) as amended by section 11
of part E of chapter 2 of the  laws  of  2005  and  subdivision  (d)  as
amended  by  section  12 of part E of chapter 2 of the laws of 2005, are
amended to read as follows:
  (a) An eligible business that relocates as defined in subdivision  (j)
of  section  22-623  of this chapter or a special eligible business that
relocates as defined in subdivision (m) of section 22-623 of this  chap-
ter  shall be allowed to receive a credit against a tax imposed by chap-
ter five, or subchapter two [or], three OR THREE-A of  chapter  six,  or
chapter eleven, of title eleven of the code, as described in subdivision
(l)  of section 11-503, subdivision nineteen of section 11-604, SUBDIVI-
SION NINETEEN OF SECTION 11-654, section 11-643.9 or  section  11-1105.3
of the code.
  (d)  An  eligible  business  or special eligible business other than a
utility company subject to the supervision of the department  of  public
service  shall  not  be authorized to receive a credit against the gross
receipts tax imposed under chapter eleven of title eleven  of  the  code
unless  such  eligible  business  or special eligible business elects to
take the credit authorized by this section against the  tax  imposed  by
such  chapter  on  its  application  filed  with the mayor or the agency
designated by such mayor pursuant to subdivision (b)  of  this  section.
The  election  authorized by this subdivision may not be withdrawn after
the issuance of such certification of eligibility. No taxpayer that  has
previously received a certification of eligibility to receive such cred-
it against any tax imposed by chapter five or subchapter two [or], three
OR  THREE-A  of  chapter  six  of  title eleven of the code may make the
election authorized by this subdivision.  No  taxpayer  that  makes  the
election  provided  in this subdivision shall be authorized to take such
credit against any tax imposed by chapter five or subchapter  two  [or],
three OR THREE-A of chapter six of title eleven of the code.
  S  27. No addition to tax under subdivision 3 of section 11-676 of the
administrative code of the city  of  New  York  shall  be  imposed  with
respect  to  declarations  or  payments  of estimated tax required under
sections 11-657 and 11-658 of the administrative code of the city of New
York for declarations otherwise required to be filed and payments other-
wise required to be made, by reason of section one of this act, prior to
or on June 15, 2015, on the  condition  that  the  taxpayer  files  such
declarations  and  makes  such  payments  no  later  than the first date
following June 15, 2015 on which an  installment  of  estimated  tax  is
required  to  be  paid,  together  with  all other such declarations and
payments then due.
  S 28. Severability clause. If any clause, sentence, paragraph,  subdi-
vision,  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 29. This act shall take effect immediately and shall apply to  taxa-
ble years beginning on or after January 1, 2015.

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                                 PART E

  Section  1. Chapter 567 of the laws of 2010 relating to establishing a
special commission on compensation, and providing for their  powers  and
duties;  and  to  provide periodic salary increases to state officers is
REPEALED.
  S 2. 1. On the first of June of every fourth year, commencing June  1,
2015,  there  shall be established a commission on legislative, judicial
and executive compensation to examine, evaluate and make recommendations
with respect to adequate levels of compensation and non-salary  benefits
for  members  of  the legislature, judges and justices of the state-paid
courts of the unified court system,  statewide  elected  officials,  and
those state officers referred to in section 169 of the executive law.
  2.  (a) In accordance with the provisions of this section, the commis-
sion shall examine: (1) the prevailing adequacy of pay levels and  other
non-salary  benefits  received  by members of the legislature, statewide
elected officials, and those state officers referred to in  section  169
of the executive law; and
  (2)  the  prevailing  adequacy  of  pay levels and non-salary benefits
received by the judges and justices of  the  state-paid  courts  of  the
unified  court  system and housing judges of the civil court of the city
of New York and determine whether any of such pay levels warrant adjust-
ment; and
  (b) The commission shall determine whether: (1) for any  of  the  four
years commencing on the first of April of such years, following the year
in  which  the  commission  is  established, the annual salaries for the
judges and justices of the state-paid courts of the unified court system
and housing judges of the civil court of the city of New York warrant an
increase; and
  (2) on the first of January after the  November  general  election  at
which members of the state legislature are elected following the year in
which the commission is established, and on the first of January follow-
ing  the  next such election, the like annual salaries and allowances of
members of the legislature, and salaries of statewide elected  officials
and  state  officers  referred  to  in  section 169 of the executive law
warrant an increase.
  3. In discharging its responsibilities under subdivision two  of  this
section,  the commission shall take into account all appropriate factors
including, but not limited to: the overall economic  climate;  rates  of
inflation; changes in public-sector spending; the levels of compensation
and  non-salary  benefits  received  by  executive  branch officials and
legislators of other states and of the federal government; the levels of
compensation  and  non-salary  benefits  received  by  professionals  in
government,  academia  and  private  and  nonprofit  enterprise; and the
state's ability to fund increases in compensation and  non-salary  bene-
fits.
  S  3. 1. The commission shall consist of seven members to be appointed
as follows: three shall be appointed  by  the  governor;  one  shall  be
appointed  by  the  temporary  president  of  the  senate;  one shall be
appointed by the speaker of the assembly; and two shall be appointed  by
the  chief  judge  of the state, one of whom shall serve as chair of the
commission.  With regard to any matters regarding legislative or  execu-
tive  compensation,  the chair shall preside but not vote.  Vacancies in
the commission shall be filled in the same manner as  original  appoint-
ments.  To  the extent practicable, members of the commission shall have

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experience in one or more of the following: determination  of  executive
compensation, human resource administration or financial management.
  2.  The  commission  shall only meet within the state, may hold public
hearings, at least one of which shall be open for the public to  provide
comments and shall have all the powers of a legislative committee pursu-
ant  to the legislative law. It shall be governed by articles 6, 6-A and
7 of the public officers law.
  3. The members of the commission shall  receive  no  compensation  for
their  services but shall be allowed their actual and necessary expenses
incurred in the performance of their duties hereunder.
  4. No member of the commission shall be disqualified from holding  any
other  public office or employment, nor shall he or she forfeit any such
office or employment by reason of his or  her  appointment  pursuant  to
this  section, notwithstanding the provisions of any general, special or
local law, regulation, ordinance or city charter.
  5. To the maximum extent feasible, the commission shall be entitled to
request and receive and shall utilize and be provided with such  facili-
ties,  resources  and  data  of  any court, department, division, board,
bureau, commission, agency or public authority of the state or any poli-
tical subdivision thereof as it may  reasonably  request  to  carry  out
properly its powers and duties pursuant to this section.
  6.  The  commission may request, and shall receive, reasonable assist-
ance from state agency personnel as necessary for the performance of its
function.
  7.  The commission shall make a report to the governor,  the  legisla-
ture  and  the  chief  judge  of the state of its findings, conclusions,
determinations and recommendations, if any, not later than  the  thirty-
first of December of the year in which the commission is established for
judicial  compensation  and the fifteenth of November the following year
for legislative and executive compensation.  Any findings,  conclusions,
determinations  and  recommendations  in the report must be adopted by a
majority vote of the  commission  and  findings,  conclusions,  determi-
nations  and  recommendations  with respect to executive and legislative
compensation shall also be supported by at least one member appointed by
each appointing authority.   Each recommendation  made  to  implement  a
determination  pursuant  to section two of this act shall have the force
of law, and shall supersede, where appropriate, inconsistent  provisions
of  article  7-B of the judiciary law, section 169 of the executive law,
and sections 5 and 5-a of the legislative law, unless modified or  abro-
gated  by  statute  prior  to  April  first of the year as to which such
determination applies to judicial compensation and January first of  the
year as to which such determination applies to legislative and executive
compensation.
  8.  Upon  the making of its report as provided in subdivision seven of
this section, each commission established pursuant to this section shall
be deemed dissolved.
  S 4. Date of  entitlement  to  salary  increase.  Notwithstanding  the
provisions  of  this act or of any other law, each increase in salary or
compensation of any officer or employee provided by this  act  shall  be
added  to  the salary or compensation of such officer or employee at the
beginning of that payroll period the first day of which  is  nearest  to
the  effective  date of such increase as provided in this act, or at the
beginning of the earlier of two payroll periods the first days of  which
are  nearest  but equally near to the effective date of such increase as
provided in this act; provided, however,  the  payment  of  such  salary
increase  pursuant to this section on a date prior thereto instead of on

S. 4610--A                         95                         A. 6721--A

such effective date, shall not operate to confer any  additional  salary
rights  or benefits on such officer or employee.  The annual salaries as
prescribed pursuant to  this  act  whenever  adjusted  pursuant  to  the
provisions  of  this act, shall be rounded up to the nearest multiple of
one hundred dollars.
  S 5. This act shall take effect immediately and  shall  be  deemed  to
have been in full force and effect on and after April 1, 2015.

                                 PART F

  Section  1.  This  act shall be known and may be cited as the "Infras-
tructure investment act".
  S 2. For the purposes of this act:
  (a) "authorized state entity" shall mean the New  York  state  thruway
authority, the department of transportation, the office of parks, recre-
ation and historic preservation, the department of environmental conser-
vation and the New York state bridge authority.
  (b)  "best  value"  shall  mean  the  basis for awarding contracts for
services to the offerer that  optimize  quality,  cost  and  efficiency,
price  and  performance  criteria, which may include, but is not limited
to:
  1. The quality of the contractor's performance on previous projects;
  2.  The  timeliness  of  the  contractor's  performance  on   previous
projects;
  3.  The  level of customer satisfaction with the contractor's perform-
ance on previous projects;
  4. The contractor's record of performing previous projects  on  budget
and ability to minimize cost overruns;
  5. The contractor's ability to limit change orders;
  6. The contractor's ability to prepare appropriate project plans;
  7. The contractor's technical capacities;
  8. The individual qualifications of the contractor's key personnel;
  9.  The  contractor's  ability  to assess and manage risk and minimize
risk impact; and
  10. The contractor's past record of compliance with  article  15-A  of
the executive law.
  Such  basis  shall reflect, wherever possible, objective and quantifi-
able analysis.
  (c) "capital project" shall have the same  meaning  as  such  term  is
defined by subdivision 2-a of section 2 of the state finance law.
  (d)  "cost  plus" shall mean compensating a contractor for the cost to
complete a contract by reimbursing actual costs for labor, equipment and
materials plus an additional amount for overhead and profit.
  (e) "design-build contract" shall mean a contract for the  design  and
construction  of  a capital project with a single entity, which may be a
team comprised of separate entities.
  (f) "procurement record" means documentation of the decisions made and
the approach taken in the procurement process.
  S 3. Notwithstanding the provisions of section 38 of the highway  law,
section  136-a  of  the  state  finance  law,  section 359 of the public
authorities law, section 7210 of the education law, and  the  provisions
of  any  other  law to the contrary, and in conformity with the require-
ments of this act, an authorized state entity may utilize  the  alterna-
tive delivery method referred to as design-build contracts, in consulta-
tion  with relevant local labor organizations and construction industry,
for capital projects related to  the  state's  physical  infrastructure,

S. 4610--A                         96                         A. 6721--A

including,  but  not  limited  to,  the state's highways, bridges, dams,
flood control projects, canals, and parks, including,  but  not  limited
to,  to  repair damage caused by natural disaster, to correct health and
safety  defects,  to  comply with federal and state laws, standards, and
regulations, to extend the useful life of or replace the  state's  high-
ways,  bridges,  dams,  flood  control projects, canals, and parks or to
improve or add to the state's highways,  bridges,  dams,  flood  control
projects, canals, and parks; provided that for the contracts executed by
the  department  of  transportation, the office of parks, recreation and
historic preservation, or the department of environmental  conservation,
the  total  cost of each such project shall not be less than one million
two hundred thousand dollars ($1,200,000).
  S 4. An entity selected by an authorized state entity to enter into  a
design-build  contract  shall  be selected through a two-step method, as
follows:
  (a) Step one. Generation of a list of entities that have  demonstrated
the  general capability to perform the design-build contract.  Such list
shall consist of a specified number of entities,  as  determined  by  an
authorized  state  entity, and shall be generated based upon the author-
ized state entity's review of responses to a publicly advertised request
for qualifications. The authorized state entity's request for qualifica-
tions shall include a general description of the  project,  the  maximum
number  of entities to be included on the list, and the selection crite-
ria to be used in generating the list.  Such  selection  criteria  shall
include the qualifications and experience of the design and construction
team,  organization, demonstrated responsibility, ability of the team or
of a member or members of the team to comply  with  applicable  require-
ments,  including  the  provisions  of  articles 145, 147 and 148 of the
education law, past record of compliance with the labor  law,  and  such
other qualifications the authorized state entity deems appropriate which
may  include  but  are  not  limited to project understanding, financial
capability and record of past performance. The authorized  state  entity
shall evaluate and rate all entities responding to the request for qual-
ifications.   Based upon such ratings, the authorized state entity shall
list the entities that shall receive a request for proposals in  accord-
ance  with  subdivision  (b) of this section.   To the extent consistent
with applicable federal law, the authorized state entity shall consider,
when awarding any contract pursuant to this section,  the  participation
of: (i) firms certified pursuant to article 15-A of the executive law as
minority  or  women-owned businesses and the ability of other businesses
under consideration to work with minority and women-owned businesses  so
as  to  promote  and  assist  participation by such businesses; and (ii)
small business  concerns  identified  pursuant  to  subdivision  (b)  of
section 139-g of the state finance law.
  (b) Step two. Selection of the proposal which is the best value to the
state.  The  authorized state entity shall issue a request for proposals
to the entities listed pursuant to subdivision (a) of this section.   If
such  an  entity  consists  of a team of separate entities, the entities
that comprise such a team must remain unchanged from the entity as list-
ed pursuant to subdivision (a) of this section unless otherwise approved
by the authorized state entity. The  request  for  proposals  shall  set
forth the project's scope of work, and other requirements, as determined
by the authorized state entity.  The request for proposals shall specify
the  criteria  to  be  used  to  evaluate the responses and the relative
weight  of  each  such  criteria.    Such  criteria  shall  include  the
proposal's  cost, the quality of the proposal's solution, the qualifica-

S. 4610--A                         97                         A. 6721--A

tions and experience of  the  design-build  entity,  and  other  factors
deemed  pertinent by the authorized state entity, which may include, but
shall not be limited to, the proposal's project implementation,  ability
to  complete  the  work in a timely and satisfactory manner, maintenance
costs of the completed project, maintenance  of  traffic  approach,  and
community  impact.  Any  contract  awarded pursuant to this act shall be
awarded  to  a  responsive  and  responsible  entity  that  submits  the
proposal,  which, in consideration of these and other specified criteria
deemed pertinent to the project, offers the best value to the state,  as
determined  by  the  authorized  state  entity.  Nothing herein shall be
construed to prohibit  the  authorized  entity  from  negotiating  final
contract terms and conditions including cost.
  S  5.  Any  contract entered into pursuant to this act shall include a
clause requiring that any professional services  regulated  by  articles
145, 147 and 148 of the education law shall be performed and stamped and
sealed, where appropriate, by a professional licensed in accordance with
such articles.
  S  6.  Construction for each capital project undertaken by the author-
ized state entity pursuant to this act shall be deemed a  "public  work"
to  be  performed  in accordance with the provisions of article 8 of the
labor law, as well as subject to sections 200, 240, 241 and 242  of  the
labor  law  and  enforcement  of prevailing wage requirements by the New
York state department of labor.
  S 7. If otherwise  applicable,  capital  projects  undertaken  by  the
authorized state entity pursuant to this act shall be subject to section
135 of the state finance law and section 222 of the labor law.
  S  8. Each contract entered into by the authorized state entity pursu-
ant to this section shall comply with the objectives and goals of minor-
ity and women-owned business enterprises pursuant to article 15-A of the
executive law or, for projects receiving federal aid, shall comply  with
applicable federal requirements for disadvantaged business enterprises.
  S 9. Capital projects undertaken by the authorized state entity pursu-
ant to this act shall be subject to the requirements of article 8 of the
environmental  conservation law, and, where applicable, the requirements
of the national environmental policy act.
  S 10.  If otherwise applicable, capital  projects  undertaken  by  the
authorized  state  entity  pursuant  to  this  act  shall be governed by
sections 139-d, 139-j, 139-k, paragraph f of subdivision 1 and paragraph
g of subdivision 9 of section 163 of the state finance law.
  S 11.  The submission of a proposal or responses or the execution of a
design-build contract pursuant to this act shall not be construed to  be
a violation of section 6512 of the education law.
  S  12.  Nothing  contained  in this act shall limit the right or obli-
gation of the authorized state entity to comply with the  provisions  of
any  existing  contract, including any existing contract with or for the
benefit of the holders of the obligations of the authorized state  enti-
ty, or to award contracts as otherwise provided by law.
  S  13. Alternative construction awarding processes.  (a) Notwithstand-
ing the provisions of any other law  to  the  contrary,  the  authorized
state entity may award a construction contract:
  1. To the contractor offering the best value; or
  2.  Utilizing  a cost-plus not to exceed guaranteed maximum price form
of contract in which the authorized state entity shall  be  entitled  to
monitor  and  audit  all project costs. In establishing the schedule and
process for determining a guaranteed maximum price, the contract between
the authorized state entity and the contractor shall:

S. 4610--A                         98                         A. 6721--A

  (i) describe the scope of the work and the  cost  of  performing  such
work;
  (ii) include a detailed line item cost breakdown;
  (iii)  include a list of all drawings, specifications and other infor-
mation on which the guaranteed maximum price is based;
  (iv) include the dates for substantial and final completion  on  which
the guaranteed maximum price is based; and
  (v) include a schedule of unit prices; or
  3.  Utilizing  a  lump  sum contract in which the contractor agrees to
accept a set dollar amount for a contract which comprises a  single  bid
without  providing a cost breakdown for all costs such as for equipment,
labor, materials, as well as such contractor's profit for completing all
items of work comprising the project.
  (b) Capital projects undertaken by  an  authorized  state  entity  may
include  an  incentive  clause  in  the contract for various performance
objectives, but the incentive clause shall not include an incentive that
exceeds the quantifiable value of the benefit received by the state. The
authorized state entity shall establish  such  performance  and  payment
bonds as it deems necessary.
  S   14.   Prequalified  contractors.  (a)  Notwithstanding  any  other
provision of law, the authorized state entity may  maintain  a  list  of
prequalified  contractors who are eligible to submit a proposal pursuant
to this act and entry into such list shall  be  continuously  available.
Prospective  contractors  may  be prequalified as contractors to provide
particular types of construction, in accordance  with  general  criteria
established  by the authorized state entity which may include, but shall
not be limited to, the experience, past performance, ability  to  under-
take the type and complexity of work, financial capability, responsibil-
ity, compliance with equal employment opportunity requirements and anti-
discrimination  laws,  and  reliability. Such prequalification may be by
categories designed by size and other factors.
  (b) A contractor who is denied prequalification or whose prequalifica-
tion is revoked or suspended by the authorized state entity  may  appeal
such  decision  to  the  authorized  state  entity. If such a suspension
extends for more than three months, it shall be deemed a  revocation  of
the  prequalification.  The authorized state entity may proceed with the
contract award during any appeal.
  S 15. Nothing in this act shall affect existing  powers  of  New  York
state public entities to use alternative project delivery methods.
  S 16. A report shall be submitted on or no later than June 30, 2016 to
the  governor,  the temporary president of the senate and the speaker of
the assembly  by  the  New  York  state  urban  development  corporation
containing  information on each authorized state entity that has entered
into a design-build contract pursuant to this act, which shall  include,
but not be limited to, a description of each project, procurement infor-
mation  including the short list of qualified bidders, the total cost of
each project, the estimated cost and schedule savings of  each  project,
an explanation of how the savings were determined, and whether a project
labor agreement was used, and if applicable, the justification for using
a project labor agreement.
  S  17.  This act shall take effect immediately and shall expire and be
deemed repealed 2 years after such date, provided  that,  projects  with
requests for qualifications issued prior to such repeal shall be permit-
ted to continue under this act notwithstanding such repeal.
                                 PART G

S. 4610--A                         99                         A. 6721--A

  Section  1.  This act may be known and be cited as the "New York State
water infrastructure improvement act of 2015".
  S 2. For purposes of this act:
  1. "water quality infrastructure project" shall mean "sewage treatment
works"  as  defined in section 17-1903 of the environmental conservation
law or "eligible project" as defined in paragraphs (a), (b), (c) and (e)
of subdivision 4 of section 1160 of the public health law.
  2. "construction" shall mean:
  (a) for sewage treatment works, the same as defined in section 17-1903
of the environmental conservation law; and
  (b) for eligible projects, the same meaning as defined in section 1160
of the public health law.
  3. "municipality" shall mean any county, city, town, village, district
corporation, county or town improvement district, school district, Indi-
an nation or tribe recognized by the state or the United States  with  a
reservation  wholly  or  partly within the boundaries of New York state,
any public benefit corporation or public authority established  pursuant
to  the  laws  of  New  York  or  any  agency of New York state which is
empowered to  construct  and  operate  a  water  quality  infrastructure
project, or any two or more of the foregoing which are acting jointly in
connection with a water quality infrastructure project.
  S  3.  1. The environmental facilities corporation shall undertake and
provide state financial assistance payments, from funds appropriated for
such purpose, to municipalities in support of water quality  infrastruc-
ture  projects provided, however, in any such year that funds are appro-
priated for such purpose, no municipality shall receive more  than  five
million  dollars  of appropriated funds. Such state financial assistance
payments shall be awarded only to water quality infrastructure  projects
for:
  (a) replacement or repair of infrastructure; or
  (b)  compliance  with  environmental  and public health laws and regu-
lations related to water quality.
  2. Any state financial assistance payment awarded pursuant to this act
shall not exceed sixty percent of the project cost.
  3. A municipality may make an application  for  such  state  financial
assistance  payment, in a manner, form and timeframe and containing such
information as the  environmental  facilities  corporation  may  require
provided  however, such requirements shall not include a requirement for
prior listing on the intended use plan.
  4. A municipality shall not be required to accept environmental facil-
ities corporation loan financing in order to obtain  a  state  financial
assistance  payment  pursuant  to  this  act  if it can provide proof of
having obtained similarly low  cost  financing  or  other  funding  from
another source.
  5.  In awarding such state financial assistance payments, the environ-
mental facilities corporation shall  consider  and  give  preference  to
municipalities  that meet the hardship criteria established by the envi-
ronmental facilities corporation  pursuant  to  section  1285-m  of  the
public  authorities  law  and projects that result in the greatest water
quality improvement or greatest reduction  in  serious  risk  to  public
health.   For the purposes of this act, the hardship criteria of section
1285-m of the public authorities law shall also apply to  sewage  treat-
ment  works defined in section 17-1903 of the environmental conservation
law.
  S 4. This act shall take effect April 1, 2015.

S. 4610--A                         100                        A. 6721--A

                                 PART H

  Section  1.  The  state finance law is amended by adding a new section
93-b to read as follows:
  S 93-B. DEDICATED INFRASTRUCTURE INVESTMENT FUND. 1. DEDICATED INFRAS-
TRUCTURE INVESTMENT FUND. (A) THERE IS HEREBY ESTABLISHED IN  THE  JOINT
CUSTODY  OF  THE  STATE COMPTROLLER AND THE COMMISSIONER OF TAXATION AND
FINANCE A SPECIAL FUND TO BE  KNOWN  AS  THE  "DEDICATED  INFRASTRUCTURE
INVESTMENT FUND".
  (B)  ACCOUNT.  THE  DEDICATED  INFRASTRUCTURE  INVESTMENT  FUND  SHALL
CONSIST OF ONE ACCOUNT, THE "INFRASTRUCTURE INVESTMENT ACCOUNT".  MONEYS
IN THIS ACCOUNT SHALL BE KEPT SEPARATE AND NOT COMMINGLED WITH ANY OTHER
MONEYS IN THE CUSTODY OF THE COMPTROLLER.
  (C) 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  AND
BECOME PART OF THE FUND, UNLESS OTHERWISE DIRECTED BY LAW.
  2.  USES  OF FUNDS. FOLLOWING APPROPRIATION BY THE LEGISLATURE, MONEYS
IN THE INFRASTRUCTURE INVESTMENT ACCOUNT SHALL BE AVAILABLE  TO  FINANCE
PROJECTS,  WORKS,  ACTIVITIES OR PURPOSES NECESSARY TO SUPPORT STATEWIDE
INVESTMENTS AS APPROPRIATED BY THE  LEGISLATURE.  NOTHING  CONTAINED  IN
THIS SECTION SHALL BE CONSTRUED TO LIMIT IN ANY WAY THE PROJECTS, WORKS,
ACTIVITIES OR PURPOSES THAT CAN BE FINANCED FROM THIS ACCOUNT, INCLUDING
BUT  NOT LIMITED TO LOANS OF MONEY TO PUBLIC CORPORATIONS OR AUTHORITIES
UNDER TERMS APPROVED BY THE DIRECTOR OF THE BUDGET.
  3. TRANSFERS. NOTWITHSTANDING ANY  OTHER  PROVISIONS  OF  LAW  TO  THE
CONTRARY, FOR THE STATE FISCAL YEAR COMMENCING ON APRIL FIRST, TWO THOU-
SAND  FIFTEEN,  THE  COMPTROLLER IS HEREBY AUTHORIZED TO TRANSFER MONIES
FROM THE DEDICATED INFRASTRUCTURE INVESTMENT FUND TO THE  GENERAL  FUND,
AND  FROM  THE  GENERAL  FUND TO THE DEDICATED INFRASTRUCTURE INVESTMENT
FUND, IN AN AMOUNT DETERMINED BY THE  DIRECTOR  OF  THE  BUDGET  TO  THE
EXTENT  MONEYS  ARE  AVAILABLE  IN THE FUND; PROVIDED, HOWEVER, THAT THE
COMPTROLLER IS ONLY AUTHORIZED TO TRANSFER  MONIES  FROM  THE  DEDICATED
INFRASTRUCTURE  INVESTMENT  FUND  TO THE GENERAL FUND IN THE EVENT OF AN
ECONOMIC DOWNTURN AS DESCRIBED IN PARAGRAPH  (A)  OF  THIS  SUBDIVISION;
AND/OR  TO FULFILL DISALLOWANCES AND/OR SETTLEMENTS RELATED TO OVER-PAY-
MENTS OF FEDERAL MEDICARE AND MEDICAID REVENUES IN EXCESS OF ONE HUNDRED
MILLION DOLLARS FROM ANTICIPATED LEVELS, AS DETERMINED BY  THE  DIRECTOR
OF THE BUDGET AND DESCRIBED IN PARAGRAPH (B) OF THIS SUBDIVISION.
  (A)  ECONOMIC  DOWNTURN.  NOTWITHSTANDING ANY LAW TO THE CONTRARY, FOR
THE PURPOSE OF THIS SECTION, THE COMMISSIONER OF LABOR  SHALL  CALCULATE
AND  PUBLISH,  ON OR BEFORE THE FIFTEENTH DAY OF EACH MONTH, A COMPOSITE
INDEX OF BUSINESS CYCLE INDICATORS. SUCH INDEX SHALL BE CALCULATED USING
MONTHLY DATA ON NEW YORK STATE  EMPLOYMENT,  TOTAL  MANUFACTURING  HOURS
WORKED,  AND  UNEMPLOYMENT  PREPARED  BY  THE DEPARTMENT OF LABOR OR ITS
SUCCESSOR AGENCY, AND TOTAL SALES TAX  COLLECTED  NET  OF  LAW  CHANGES,
PREPARED  BY  THE  DEPARTMENT  OF  TAXATION AND FINANCE OR ITS SUCCESSOR
AGENCY. SUCH INDEX SHALL BE CONSTRUCTED IN ACCORDANCE  WITH  THE  PROCE-
DURES  FOR  CALCULATING COMPOSITE INDEXES ISSUED BY THE CONFERENCE BOARD
OR ITS SUCCESSOR ORGANIZATION, AND ADJUSTED FOR SEASONAL  VARIATIONS  IN
ACCORDANCE WITH THE PROCEDURES ISSUED BY THE CENSUS BUREAU OF THE UNITED
STATES  DEPARTMENT OF COMMERCE OR ITS SUCCESSOR AGENCY. IF THE COMPOSITE
INDEX DECLINES FOR FIVE CONSECUTIVE MONTHS, THE  COMMISSIONER  OF  LABOR
SHALL  NOTIFY  THE  GOVERNOR, THE SPEAKER OF THE ASSEMBLY, THE TEMPORARY

S. 4610--A                         101                        A. 6721--A

PRESIDENT OF THE SENATE, AND THE MINORITY LEADERS OF  THE  ASSEMBLY  AND
THE  SENATE.  UPON  SUCH  NOTIFICATION,  THE  DIRECTOR OF THE BUDGET MAY
AUTHORIZE AND DIRECT THE COMPTROLLER  TO  TRANSFER  FROM  THE  DEDICATED
INFRASTRUCTURE  INVESTMENT  FUND TO THE GENERAL FUND SUCH AMOUNTS AS THE
DIRECTOR OF THE BUDGET DEEMS NECESSARY TO MEET THE REQUIREMENTS  OF  THE
STATE  FINANCIAL  PLAN.  THE  AUTHORITY  TO  TRANSFER  FUNDS  UNDER  THE
PROVISIONS OF THIS PARAGRAPH SHALL LAPSE WHEN THE COMPOSITE INDEX  SHALL
HAVE  INCREASED  FOR  FIVE  CONSECUTIVE MONTHS OR TWELVE MONTHS FROM THE
ORIGINAL NOTIFICATION OF THE COMMISSIONER  OF  LABOR,  WHICHEVER  OCCURS
EARLIER.  PROVIDED,  HOWEVER,  THAT FOR EVERY ADDITIONAL AND CONSECUTIVE
MONTHLY DECLINE SUCCEEDING THE  FIVE  MONTH  DECLINE  SO  NOTED  BY  THE
COMMISSIONER  OF LABOR, THE TWELVE MONTH LAPSE DATE SHALL BE EXTENDED BY
ONE ADDITIONAL MONTH.
  (B) FEDERAL MEDICARE AND MEDICAID REVENUES. NOTWITHSTANDING ANY LAW TO
THE CONTRARY, THE DIRECTOR OF THE BUDGET MAY AUTHORIZE  AND  DIRECT  THE
COMPTROLLER  TO  TRANSFER  FROM  THE DEDICATED INFRASTRUCTURE INVESTMENT
FUND TO THE GENERAL FUND AN  AMOUNT  NOT  TO  EXCEED  THE  DISALLOWANCES
AND/OR  SETTLEMENTS RELATED TO THE OVER-PAYMENTS OF FEDERAL MEDICARE AND
MEDICAID REVENUES. IN THE EVENT  THIS  AUTHORIZATION  IS  UTILIZED,  THE
DIRECTOR  OF  THE  BUDGET  MAY  AUTHORIZE  AND DIRECT THE COMPTROLLER TO
TRANSFER SUCH AMOUNT AND THE CONCOMITANT REDUCTION IN STATE SHARE  MEDI-
CARE  AND  MEDICAID  REVENUES FROM THE GENERAL FUND TO THE MISCELLANEOUS
SPECIAL REVENUE FUND, MENTAL HYGIENE PROGRAM FUND (21907), THE MISCELLA-
NEOUS SPECIAL REVENUE FUND, PATIENT  INCOME  ACCOUNT  (21909),  AND  THE
MEDICAID  MANAGEMENT  INFORMATION  SYSTEM  (MMIS)  STATEWIDE ESCROW FUND
(60901).
  (C) PRIOR TO AUTHORIZING ANY TRANSFER FROM THE  DEDICATED  INFRASTRUC-
TURE  INVESTMENT  FUND  ACCOUNTS  PURSUANT  TO  THE  PROVISIONS  OF THIS
SECTION, THE DIRECTOR OF THE BUDGET SHALL  NOTIFY  THE  SPEAKER  OF  THE
ASSEMBLY,  THE TEMPORARY PRESIDENT OF THE SENATE, AND THE MINORITY LEAD-
ERS OF THE ASSEMBLY AND  THE  SENATE.  SUCH  LETTER  SHALL  SPECIFY  THE
REASONS FOR THE TRANSFER AND THE AMOUNT THEREOF.
  S 2. This act shall take effect immediately.

                                 PART I

  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 account (20451).
  2. Proprietary vocational school supervision account (20452).
  3. Local government records management account (20501).
  4. Child health plus program account (20810).
  5. EPIC premium account (20818).
  6. Education - New (20901).
  7. VLT - Sound basic education fund (20904).
  8.  Sewage  treatment  program  management  and  administration   fund
(21000).
  9. Hazardous bulk storage account (21061).
  10. Federal grants indirect cost recovery account (21065).
  11. Low level radioactive waste account (21066).
  12. Recreation account (21067).
  13. Public safety recovery account (21077).
  14. Environmental regulatory account (21081).
  15. Natural resource account (21082).

S. 4610--A                         102                        A. 6721--A

  16. Mined land reclamation program account (21084).
  17. Great lakes restoration initiative account (21087).
  18. Environmental protection and oil spill compensation fund (21200).
  19. Public transportation systems account (21401).
  20. Metropolitan mass transportation (21402).
  21. Operating permit program account (21451).
  22. Mobile source account (21452).
  23.   Statewide  planning  and  research  cooperative  system  account
(21902).
  24. OPWDD provider of service account (21903).
  25. Mental hygiene program fund account (21907).
  26. Mental hygiene patient income account (21909).
  27. Financial control board account (21911).
  28. Regulation of racing account (21912).
  29. New York Metropolitan Transportation Council account (21913).
  30. State university dormitory income reimbursable account (21937).
  31. Energy research account (21943).
  32. Criminal justice improvement account (21945).
  33. Fingerprint identification and technology account (21950).
  34. Environmental laboratory reference fee account (21959).
  35. Clinical laboratory reference system assessment account (21962).
  36. Indirect cost recovery account (21978).
  37. High school equivalency program account (21979).
  38. Multi-agency training account (21989).
  39. Bell jar collection account (22003).
  40. Industry and utility service account (22004).
  41. Real property disposition account (22006).
  42. Parking account (22007).
  43. Asbestos safety training program account (22009).
  44. Batavia school for the blind account (22032).
  45. Investment services account (22034).
  46. Surplus property account (22036).
  47. Financial oversight account (22039).
  48. Regulation of indian gaming account (22046).
  49. Rome school for the deaf account (22053).
  50. Seized assets account (22054).
  51. Administrative adjudication account (22055).
  52. Federal salary sharing account (22056).
  53. New York City assessment account (22062).
  54. Cultural education account (22063).
  55. Local services account (22078).
  56. DHCR mortgage servicing account (22085).
  57. Department of motor vehicles compulsory insurance account (22087).
  58. Housing indirect cost recovery account (22090).
  59. Accident prevention course program account (22094).
  60. DHCR-HCA application fee account (22100).
  61. Low income housing monitoring account (22130).
  62. Corporation administration account (22135).
  63. Montrose veteran's home account (22144).
  64. Deferred compensation administration account (22151).
  65. Rent revenue other New York City account (22156).
  66. Rent revenue account (22158).
  67. Tax revenue arrearage account (22168).
  68. State university general income offset account (22654).
  69. State police motor vehicle law enforcement account (22802).
  70. Highway safety program account (23001).

S. 4610--A                         103                        A. 6721--A

  71. EFC drinking water program account (23101).
  72. DOH drinking water program account (23102).
  73. NYCCC operating offset account (23151).
  74. Commercial gaming revenue account (23701).
  75. Commercial gaming regulation account (23702).
  76. Highway and bridge capital account (30051).
  77. State university residence hall rehabilitation fund (30100).
  78. State parks infrastructure account (30351).
  79. Clean water/clean air implementation fund (30500).
  80. Hazardous waste remedial cleanup account (31506).
  81. Youth facilities improvement account (31701).
  82. Housing assistance fund (31800).
  83. Housing program fund (31850).
  84. Highway facility purpose account (31951).
  85. Information technology capital financing account (32215).
  86. New York racing account (32213).
  87. Mental hygiene facilities capital improvement fund (32300).
  88. Correctional facilities capital improvement fund (32350).
  89. New York State Storm Recovery Capital Fund (33000).
  90. OGS convention center account (50318).
  91. Centralized services fund (55000).
  92. Archives records management account (55052).
  93. Federal single audit account (55053).
  94. Civil service law section II administrative account (55055).
  95. Civil service EHS occupational health program account (55056).
  96. Banking services account (55057).
  97. Cultural resources survey account (55058).
  98. Neighborhood work project (55059).
  99. Automation & printing chargeback account (55060).
  100. OFT NYT account (55061).
  101. Data center account (55062).
  102. Intrusion detection account (55066).
  103. Domestic violence grant account (55067).
  104. Centralized technology services account (55069).
  105. Labor contact center account (55071).
  106. Human services contact center account (55072).
  107. Tax contact center account (55073).
  108. Executive direction internal audit account (55251).
  109. CIO Information technology centralized services account (55252).
  110. Health insurance internal service account (55300).
  111.  Civil  service employee benefits division administrative account
(55301).
  112. Correctional industries revolving fund (55350).
  113. Employees health insurance account (60201).
  114. Medicaid management information system escrow fund (60900).
  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 and nutrition services fund (25000).
  2. Federal health and human services fund (25100).
  3. Federal education fund (25200).
  4. Federal block grant fund (25250).
  5. Federal miscellaneous operating grants fund (25300).

S. 4610--A                         104                        A. 6721--A

  6. Federal unemployment insurance administration fund (25900).
  7. Federal unemployment insurance occupational training fund (25950).
  8. Federal emergency employment act fund (26000).
  9. Federal capital projects fund (31350).
  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, 2016, 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.  $3,000,000  from  the  general  fund  to the miscellaneous special
revenue fund, tax revenue arrearage account (22168).
  5. $552,000 from the miscellaneous special revenue fund, consumer food
industry account (21966), to the general fund.
  Education:
  1. $2,219,000,000 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. $950,000,000 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.
  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 (20500) to the archives partnership trust fund (20350).
  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.  $343,400,000  from  the  state  university  dormitory  income fund
(40350) to the miscellaneous  special  revenue  fund,  state  university
dormitory income reimbursable account (21937).
  8.  $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).
  9.  $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.
  10. $45,000,000 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, 2015 through March 31,
2016.
  Environmental Affairs:

S. 4610--A                         105                        A. 6721--A

  1. $16,000,000 from any of the department of  environmental  conserva-
tion's  special  revenue federal funds to the environmental conservation
special revenue fund, federal indirect recovery account (21065).
  2.  $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.
  3. $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 miscellaneous special revenue fund, federal grant  indirect
cost recovery account (22188).
  4. $1,000,000 from any of the office of parks, recreation and historic
preservation  special revenue federal funds to the miscellaneous special
revenue fund, I love NY water account (21930).
  5. $23,000,000 from the general fund to the  environmental  protection
fund, environmental protection fund transfer account (30451).
  6.  $8,500,000  from  the general fund to the hazardous waste remedial
fund, hazardous waste oversight and assistance account (31505).
  7. $25,000,000 from the environmental protection  fund,  environmental
protection transfer account (30451), to the general fund.
  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).
  3. $18,670,000 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.
  4.  $166,000,000  from  any  of the office of temporary and disability
assistance or department of health special revenue funds to the  general
fund.
  5.  $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).
  6. $35,000,000 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).
  7.  $65,000,000  from  the  miscellaneous  special revenue fund, youth
facility per diem account (22186), to the general fund.
  8. $621,850 from the general fund to the combined gifts,  grants,  and
bequests fund, WB Hoyt Memorial account (20128).
  9.  $3,100,000  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.

S. 4610--A                         106                        A. 6721--A

  2. $12,500,000 from the general fund to the health insurance revolving
fund (55300).
  3.  $192,400,000  from  the  health  insurance  reserve  receipts fund
(60550) to the general fund.
  4. $150,000 from the general fund to the not-for-profit revolving loan
fund (20650).
  5. $150,000 from the not-for-profit revolving loan fund (20650) to the
general fund.
  6. $3,000,000 from the miscellaneous  special  revenue  fund,  surplus
property account (22036), to the general fund.
  7.  $19,900,000  from  the  general  fund to the miscellaneous special
revenue fund, alcoholic beverage control account (22033).
  8. $23,000,000 from the miscellaneous special  revenue  fund,  revenue
arrearage account (22024), to the general fund.
  9.  $1,826,000  from  the  miscellaneous special revenue fund, revenue
arrearage account (22024), to the miscellaneous  special  revenue  fund,
authority budget office account (22138).
  10.  $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.
  11.  $21,794,000  from  the general fund to the internal service fund,
COPS account (55013).
  12. $8,360,000 from the general fund to the agencies internal  service
fund,  central  technology  services account (55069), for the purpose of
enterprise technology projects.
  13. $5,000,000 from the miscellaneous special revenue  fund,  workers'
compensation  account  (21995),  to  the  miscellaneous capital projects
fund, workers' compensation board IT business process design fund.
  Health:
  1. $30,000,000 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.  $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.
  4. $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.
  5. $30,295,000 from the HCRA resources fund (20800) to  the  miscella-
neous  special  revenue  fund, empire state stem cell trust fund account
(22161).
  6. $30,000,000 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).
  7. $6,000,000 from the miscellaneous special revenue fund, certificate
of need account (21920), to the  miscellaneous  capital  projects  fund,
healthcare IT capital subfund.
  8.  $1,000,000  from  the miscellaneous special revenue fund, adminis-
tration program account (21982), to the miscellaneous  capital  projects
fund, healthcare IT capital account (32216).

S. 4610--A                         107                        A. 6721--A

  9.  $1,000,000  from  the  miscellaneous  special  revenue fund, vital
records account (22103), to the  miscellaneous  capital  projects  fund,
healthcare IT capital account (32216).
  10.  $55,000,000  from  the HCRA resources fund (20800) to the capital
projects fund (30000).
  11. $3,700,000 from the miscellaneous  New  York  state  agency  fund,
medical assistance account to the general fund.
  12.  $6,740,000  from  the general fund to the medical marihuana trust
fund, health operation and oversight account (23755).
  13. $4,096,000 from the HCRA resources fund (20800), to the  miscella-
neous special revenue fund, cigarette strike force account.
  14.  $3,086,000  from  the miscellaneous special revenue fund, certif-
icate of need account (21920), to the general fund.
  Labor:
  1. $400,000 from the miscellaneous special revenue fund, DOL  fee  and
penalty account (21923), to the child performer's protection fund, child
performer protection account (20401).
  2. $8,400,000 from the miscellaneous special revenue fund, DOL fee and
penalty account (21923), to the general fund.
  3.  $3,300,000  from  the  unemployment insurance interest and penalty
fund,  unemployment  insurance  special  interest  and  penalty  account
(23601), to the general fund.
  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.  $15,000,000  from  the  miscellaneous special revenue fund, mental
hygiene patient income account (21909),  to  the  miscellaneous  special
revenue fund, provider of service accounts (21903).
  3.  $15,000,000  from  the  miscellaneous special revenue fund, mental
hygiene program fund  account  (21907),  to  the  miscellaneous  special
revenue fund, provider of service account (21903).
  4.  $1,400,000,000  from the general fund to the miscellaneous special
revenue fund, mental hygiene patient income account (21909).
  5. $1,850,000,000 from the general fund to the  miscellaneous  special
revenue fund, mental hygiene program fund account (21907).
  6.  $100,000,000  from  the miscellaneous special revenue fund, mental
hygiene program fund account (21907), to the general fund.
  7. $100,000,000 from the miscellaneous special  revenue  fund,  mental
hygiene patient income account (21909), to the general fund.
  8.  $292,888,000  from  the chemical dependence service fund, chemical
dependence service account (22700), 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. $13,000,000 from the general fund to  the  correctional  industries
revolving   fund,   correctional  industries  internal  service  account
(55350).
  4. $3,000,000 from the federal miscellaneous  operating  grants  fund,
DMNA damage account (25324), to the general fund.
  5.  $14,300,000  from  the  general  fund to the miscellaneous special
revenue fund, crimes against revenue program account (22015).
  6. $22,900,000 from the miscellaneous special revenue  fund,  criminal
justice improvement account (21945), to the general fund.

S. 4610--A                         108                        A. 6721--A

  7.  $50,000,000 from the miscellaneous special revenue fund, statewide
public safety communications account (22123), to the general fund.
  8.  $106,000,000  from  the state police motor vehicle law enforcement
and motor vehicle theft  and  insurance  fraud  prevention  fund,  state
police  motor  vehicle  enforcement account (22802), to the general fund
for state operation expenses of the division of state police.
  9. $21,500,000 from the general fund to  the  correctional  facilities
capital improvement fund (32350).
  10.  $5,000,000  from  the  general  fund to the dedicated highway and
bridge trust fund (30050) for the purpose of work zone safety activities
provided by the division of state police for the department of transpor-
tation.
  11. $5,000,000 from the miscellaneous special revenue fund,  statewide
public  safety  communications  account (22123), to the capital projects
fund (30000).
  12. $2,900,000 from the  miscellaneous  special  revenue  fund,  legal
services assistance account (22096), to the general fund.
  13.  $300,000  from the state police motor vehicle law enforcement and
motor vehicle theft and insurance fraud prevention fund,  motor  vehicle
theft and insurance fraud account (22801), to the general fund.
  Transportation:
  1. $17,672,000 from the federal miscellaneous operating grants fund to
the  miscellaneous special revenue fund, New York Metropolitan Transpor-
tation Council account (21913).
  2. $20,147,000 from the federal capital projects fund to the miscella-
neous special revenue fund, New York Metropolitan Transportation Council
account (21913).
  3. $15,700,000 from the miscellaneous special revenue fund, compulsory
insurance account (22087), to the general fund.
  4. $14,878,096 from the general fund to the mass transportation  oper-
ating  assistance  fund, public transportation systems operating assist-
ance account (21401), of which $12,000,000 constitutes the base need for
operations.
  5. $728,507,000 from the general fund to  the  dedicated  highway  and
bridge trust fund (30050).
  6.  $606,000  from  the  miscellaneous  special revenue fund, accident
prevention course 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.  $309,250,000 from the general fund to the MTA financial assistance
fund, mobility tax trust account (23651).
  9. $20,000,000 from the mass transportation operating assistance fund,
metropolitan mass transportation operating assistance  account  (21402),
to  the  general  debt  service  fund  (40151), for reimbursement of the
state's expenses in connection with payments of debt service and related
expenses for the metropolitan transportation authority's  state  service
contract bonds.
  10.  $5,000,000 from the miscellaneous special revenue fund, transpor-
tation regulation account (22067) to the dedicated  highway  and  bridge
trust  fund  (30050),  for  disbursements  made from such fund for motor
carrier safety that are in excess of the amounts deposited in the  dedi-
cated highway and bridge trust fund (30050) for such purpose pursuant to
section 94 of the transportation law.
  11.  $121,548,000  from  the  mass transportation operating assistance
fund, metropolitan  mass  transportation  operating  assistance  account
(21402),  to the transit assistance for capital investments fund, metro-

S. 4610--A                         109                        A. 6721--A

politan  transit  assistance  for  capital  investments   account,   for
disbursements  made  from such fund pursuant to a chapter of the laws of
2015.
  Miscellaneous:
  1. $200,000,000 from the general fund to any funds or accounts for the
purpose of reimbursing certain outstanding accounts receivable balances.
  2.  $500,000,000  from  the general fund to the debt reduction reserve
fund (40000).
  3. $450,000,000 from the New York state storm  recovery  capital  fund
(33000) to the revenue bond tax fund (40152).
  4.  $15,500,000  from  the general fund, community projects account GG
(10256), to the general fund, state purposes account (10050).
  5. $4,550,000,000 from the general fund to the  dedicated  infrastruc-
ture investment fund infrastructure investment account.
  6. Upon request of the director of the budget, up to $850,000,000 from
the  general fund to any special revenue fund or account, agency fund or
account, or any combination of funds or accounts.
  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, 2016:
  1.  Upon request of the commissioner of environmental conservation, up
to $11,354,000 from revenues credited to any of the department of  envi-
ronmental  conservation special revenue funds, including $3,285,400 from
the environmental protection and oil spill  compensation  fund  (21200),
and  $1,779,600 from the conservation fund (21150), 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 miscellaneous special revenue fund, housing indirect
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 $5,000,000 from
revenues credited to any of the department of health's  special  revenue
funds, to the miscellaneous special revenue fund, administration account
(21982).
  S 4. On or before March 31, 2016, 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  5.  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

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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  6.  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, 2016, 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  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, 2016, 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  8.  Notwithstanding  any  law to the contrary, the state university
chancellor or his or her designee is authorized and directed to transfer
estimated tuition revenue balances from the state university  collection
fund  (61000)  to  the  state  university  income fund, state university
general revenue offset account (22655) on or before March 31, 2016.
  S 9. 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  $87,864,000  from  the  general  fund to the state university income
fund, state university hospitals  income  reimbursable  account  (22656)
during  the period July 1, 2015 through June 30, 2016 to reflect ongoing
state subsidy of SUNY hospitals and to pay  costs  attributable  to  the
SUNY hospitals' state agency status.
  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 $1,004,249,800 from the general fund to the state  university  income
fund, state university general revenue offset account (22655) during the
period  of  July  1, 2015 through June 30, 2016 to support operations at
the state university.
  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
to $3,370,000 from the general fund to the state university income fund,
state university general revenue offset account (22655) during the peri-
od  of  April 1, 2015 through June 30, 2015 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 $55,000,000 from the state  university
income  fund,  state  university  hospitals  income reimbursable account
(22656), for services and expenses of hospital  operations  and  capital
expenditures at the state university hospitals; and the state university

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income  fund,  Long  Island  veterans' home account (22652) to the state
university capital projects fund (32400) on or before June 30, 2016.
  S  12-a.  Subdivision  2 of section 92-cc of the state finance law, as
amended by section 17 of part U of chapter 59 of the laws  of  2012,  is
amended to read as follows:
  2.  Such  fund shall have a maximum balance not to exceed [three] FIVE
per centum of the aggregate amount projected to be  disbursed  from  the
general  fund during the fiscal year immediately following the then-cur-
rent fiscal year. At the request of the  director  of  the  budget,  the
state comptroller shall transfer monies to the rainy day reserve fund up
to  and including an amount equivalent to [three-tenths of] SEVENTY-FIVE
ONE-HUNDREDTHS OF one per centum of the aggregate amount projected to be
disbursed from the general fund during  the  then-current  fiscal  year,
unless  such  transfer  would  increase the rainy day reserve fund to an
amount in excess of [three] FIVE per  centum  of  the  aggregate  amount
projected  to  be disbursed from the general fund during the fiscal year
immediately following the then-current fiscal year, in which event  such
transfer  shall be limited to such amount as will increase the rainy day
reserve fund to such [three] FIVE per centum limitation.
  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  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 hospitals income reimbursable account (22656) to
pay hospital operating costs or 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, 2016.
  S  14.  Notwithstanding any law to the contrary, upon the direction of
the director of the budget and the chancellor of the state university of
New York or his or her designee, and in accordance with section 4 of the
state finance law, the comptroller is hereby authorized and directed  to
transfer  monies from the state university dormitory income fund (40350)
to the state university residence hall rehabilitation fund (30100),  and
from  the state university residence hall rehabilitation fund (30100) to
the state university dormitory income fund (40350), in a net amount  not
to exceed $80 million.
  S  15. 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, 2016, 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

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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  16. 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, at the request of the director of the  budget,
up  to $500 million from the unencumbered balance of any special revenue
fund or account, agency  fund  or  account,  internal  service  fund  or
account,  enterprise  fund  or account, or any combination of such funds
and accounts, to the general fund. The amounts transferred  pursuant  to
this authorization shall be in addition to any other transfers expressly
authorized  in  the  2015-16  budget. Transfers from federal funds, debt
service funds, capital projects funds, the community projects  fund,  or
funds  that would result in the loss of eligibility for federal benefits
or federal funds pursuant to federal law, rule, or regulation as assent-
ed to in chapter 683 of the laws of 1938 and chapter 700 of the laws  of
1951 are not permitted pursuant to this authorization.
  S  16-a.  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, at the request of the director of
the budget, up to 28 million dollars ($28,000,000) from the unencumbered
balance of any special revenue fund or account, or combination of  funds
and  accounts,  to  the community projects fund. The amounts transferred
pursuant to this authorization shall be in addition to any other  trans-
fers  expressly authorized in the 2014-15 budget. Transfers from federal
funds, debt services funds, capital projects funds, or funds that  would
result  in the loss of eligibility for federal benefits or federal funds
pursuant to federal law, rule, or regulation as assented to  in  chapter
683  of  the  laws  of  1938 and chapter 700 of the laws of 1951 are not
permitted pursuant to this authorization. The  director  of  the  budget
shall  (a) have received a request in writing from one or both houses of
the legislature, and (b) notify both houses of the legislature in  writ-
ing  prior  to initiating transfers pursuant to this authorization.  The
comptroller shall provide the director of the budget, the chair  of  the
senate  finance  committee, and the chair of the assembly ways and means
committee with an accurate accounting and report of any  transfers  that
occur  pursuant  to  this  section on or before the fifteenth day of the
following month in which such transfers occur.
  S 17. 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, at the request of the director of the budget,
up to $100 million from any non-general fund or account, or  combination
of  funds and accounts, to the miscellaneous special revenue fund, tech-
nology financing account (22207) or the miscellaneous  capital  projects
fund,  information technology capital financing account (32215), for the
purpose  of  consolidating  technology  procurement  and  services.  The
amounts transferred to the miscellaneous special revenue fund, technolo-
gy  financing  account  (22207)  pursuant to this authorization shall be
equal to or less than the amount of  such  monies  intended  to  support
information  technology  costs  which  are  attributable, according to a
plan, to such account made in pursuance  to  an  appropriation  by  law.
Transfers  to  the  technology financing account shall be completed from
amounts collected by non-general funds or accounts pursuant  to  a  fund
deposit  schedule  or permanent statute, and shall be transferred to the
technology financing account pursuant to a schedule agreed upon  by  the
affected  agency commissioner. Transfers from funds that would result in

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the loss of eligibility for federal benefits or federal  funds  pursuant
to federal law, rule, or regulation as assented to in chapter 683 of the
laws  of  1938  and  chapter  700  of the laws of 1951 are not permitted
pursuant to this authorization.
  S  18. 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, at the request of the director of the  budget,
up  to $300 million from any non-general fund or account, or combination
of funds and accounts, to the general fund for the  purpose  of  consol-
idating  technology  procurement  and  services. The amounts transferred
pursuant to this authorization shall be equal to or less than the amount
of such monies intended to support information  technology  costs  which
are attributable, according to a plan, to such account made in pursuance
to  an  appropriation  by  law.  Transfers  to the general fund shall be
completed from amounts collected by non-general funds or accounts pursu-
ant to a fund deposit schedule. Transfers from funds that  would  result
in  the loss of eligibility for federal benefits or federal funds pursu-
ant to federal law, rule, or regulation as assented to in chapter 683 of
the laws of 1938 and chapter 700 of the laws of 1951 are  not  permitted
pursuant to this authorization.
  S  19. Notwithstanding any provision of law to the contrary, as deemed
feasible and advisable by its trustees, the power authority of the state
of New York is authorized and directed to (i) make a contribution to the
state treasury to the credit  of  the  general  fund,  or  as  otherwise
directed in writing by the director of the budget, in an amount of up to
$90,000,000  for  the  state  fiscal  year commencing April 1, 2015, the
proceeds of which will be utilized to support energy-related initiatives
of the state, or for economic development purposes, and (ii) transfer up
to $25,000,000 of any such contribution by June 30, 2015 and the remain-
der of any such contribution by March 31, 2016. Such  economic  develop-
ment  purposes  may  include,  but  shall  not be limited to, efforts to
attract and expand business investment and  job  creation  in  New  York
state  through  the  Open  for  Business program as well as all expenses
associated with Global NY and  trade  missions,  domestic  and  interna-
tional,  promoting  New  York businesses; provided that in the event any
contributed funds are used by a state agency or public authority for the
purpose of advertising and promoting the benefits  of  the  START-UP  NY
program,  no  more  than sixty percent of the contributed funds used for
such purpose shall be used for advertising  and  promotion  outside  the
state of New York.
  S  20. Notwithstanding any provision of law, rule or regulation to the
contrary, the New York State energy research and  development  authority
is  authorized and directed to make a contribution to the state treasury
to the credit of the general fund in  the  amount  of  $41,000,000  from
proceeds  collected  by the authority from the auction or sale of carbon
dioxide emission allowances allocated by the department of environmental
conservation under the Regional Greenhouse Gas Initiative on  or  before
March 31, 2016.
  S  21.  Subdivision  5  of section 97-rrr of the state finance law, as
amended by section 20 of part I of chapter 55 of the laws  of  2014,  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

S. 4610--A                         114                        A. 6721--A

contrary,  during  the  fiscal  year beginning April first, two thousand
[fourteen] FIFTEEN, 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
[$3,429,375,000] $3,382,279,000, 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 [fourteen] FIFTEEN.
  S 22. 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  2015.  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 2015 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 23. 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.  Annually on or before each June 30th, 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
investment of monies deposited therein that  will  or  may  have  to  be
rebated  to  the  federal  government  pursuant to the provisions of the
internal revenue code of 1986, as amended.
  S 24. Subdivision 8 of section 68-b  of  the  state  finance  law,  as
amended  by  section 44 of part HH of chapter 57 of the laws of 2013, 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 AND THE NEW YORK STATE THRUWAY AUTHORITY
may issue revenue bonds for any authorized purpose  of  any  other  such
authorized  issuer  through  March  thirty-first, two thousand [fifteen]
TWENTY.  ANY SUCH REVENUE BONDS ISSUED BY THE  NEW  YORK  STATE  THRUWAY
AUTHORITY  SHALL BE SUBJECT TO THE APPROVAL OF THE NEW YORK STATE PUBLIC
AUTHORITIES CONTROL BOARD, PURSUANT TO SECTION FIFTY-ONE OF  THE  PUBLIC
AUTHORITIES  LAW.  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

S. 4610--A                         115                        A. 6721--A

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  24-a.  Subdivision  8  of section 69-n of the state finance law, as
added by section 58 of part HH of chapter 57 of the  laws  of  2013,  is
amended to read as follows:
  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. ANY SUCH REVENUE BONDS ISSUED BY THE NEW YORK STATE THRU-
WAY AUTHORITY SHALL BE SUBJECT TO THE APPROVAL OF  THE  NEW  YORK  STATE
PUBLIC  AUTHORITIES  CONTROL BOARD, PURSUANT TO SECTION FIFTY-ONE OF THE
PUBLIC AUTHORITIES LAW. 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  25.  Subdivision 1 of section 47 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 28 of part I of chapter 55 of the laws
of 2014, is amended to read as follows:
  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 office of information technology services, depart-
ment of  law,  and  other  state  costs  associated  with  such  capital
projects.  The  aggregate  principal  amount  of  bonds authorized to be
issued pursuant to this section  shall  not  exceed  [one]  TWO  hundred
[eighty-two]  SIXTY-NINE  million  [four]  ONE  hundred  forty  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.
  S 26. 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 51 to read as follows:
  S  51.  1.  NOTWITHSTANDING  THE  PROVISIONS  OF  ANY OTHER LAW TO THE
CONTRARY, THE DORMITORY AUTHORITY AND THE URBAN DEVELOPMENT  CORPORATION
ARE  HEREBY AUTHORIZED TO ISSUE BONDS OR NOTES IN ONE OR MORE SERIES FOR
THE PURPOSE OF FUNDING PROJECT COSTS FOR  THE  NONPROFIT  INFRASTRUCTURE
CAPITAL  INVESTMENT  PROGRAM  AND OTHER STATE COSTS ASSOCIATED WITH SUCH
CAPITAL PROJECTS. THE AGGREGATE PRINCIPAL AMOUNT OF BONDS AUTHORIZED  TO

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BE  ISSUED  PURSUANT  TO  THIS  SECTION  SHALL  NOT EXCEED 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 OTHERWISE REPAY SUCH BONDS OR NOTES PREVIOUSLY ISSUED. SUCH
BONDS  AND  NOTES  OF  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 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.
  2. NOTWITHSTANDING ANY OTHER PROVISION OF  LAW  TO  THE  CONTRARY,  IN
ORDER TO ASSIST THE DORMITORY AUTHORITY AND THE URBAN DEVELOPMENT CORPO-
RATION  IN UNDERTAKING THE FINANCING FOR PROJECT COSTS FOR THE NONPROFIT
INFRASTRUCTURE CAPITAL INVESTMENT PROGRAM AND OTHER STATE COSTS  ASSOCI-
ATED  WITH  SUCH  CAPITAL PROJECTS, THE DIRECTOR OF THE BUDGET IS HEREBY
AUTHORIZED TO ENTER INTO ONE OR MORE SERVICE CONTRACTS WITH THE DORMITO-
RY AUTHORITY AND THE URBAN DEVELOPMENT CORPORATION, NONE OF WHICH  SHALL
EXCEED  THIRTY  YEARS IN DURATION, UPON SUCH TERMS AND CONDITIONS AS THE
DIRECTOR OF THE BUDGET AND THE DORMITORY AUTHORITY AND THE URBAN  DEVEL-
OPMENT  CORPORATION  AGREE,  SO  AS TO ANNUALLY PROVIDE TO THE DORMITORY
AUTHORITY AND THE URBAN DEVELOPMENT 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 URBAN DEVELOPMENT CORPO-
RATION AS SECURITY FOR ITS  BONDS  AND  NOTES,  AS  AUTHORIZED  BY  THIS
SECTION.
  S 27. 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
section  29  of  part I of chapter 55 of the laws of 2014, 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  seven  billion  one  hundred
[forty-eight]  SIXTY-THREE  million  THREE  HUNDRED  sixty-nine thousand
dollars [$7,148,069,000] $7,163,369,000, 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 correc-
tional facilities capital improvement fund to pay for all or any portion
of the amount or amounts paid by the state from appropriations or  reap-
propriations  made to the department of corrections and community super-
vision from the correctional facilities  capital  improvement  fund  for
capital  projects.  The  aggregate amount of bonds, notes or other obli-

S. 4610--A                         117                        A. 6721--A

gations 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 seven billion one hundred [forty-eight] SIXTY-THREE million
THREE    HUNDRED    sixty-nine    thousand    dollars   [$7,148,069,000]
$7,163,369,000, only if the present value of the aggregate 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 obli-
gations, 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 thereof 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 ther-
eof.
  S  28.  Paragraph  (a) of subdivision 2 of section 47-e of the private
housing finance law, as amended by section 30 of part I of chapter 55 of
the laws of 2014, 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;
provided, however, that the agency may issue such bonds and notes in  an
aggregate  principal amount not exceeding [two] THREE billion [nine] ONE
hundred [ninety-nine]  FIFTY-THREE  million  SEVEN  HUNDRED  ninety-nine
thousand  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
marketability  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.

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  S  29.  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 31 of part I of chapter 55 of the laws of 2014, 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  or  to  reimburse  the
state  for  funding  such  projects  having  a  cost  not  in  excess of
[$8,120,728,000] $8,658,881,000 cumulatively by the end of  fiscal  year
[2014-15] 2015-16.
  S  30.  Subdivision 1 of section 1689-i of the public authorities law,
as amended by section 32 of part I of chapter 55 of the laws of 2014, 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 [one hundred twenty-six] ONE HUNDRED
FORTY million dollars.
  S 31. 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  33  of
part I of chapter 55 of the laws of 2014, 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
[$149,600,000]  $155,600,000,  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
including IT initiatives for the division of state police, 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  subdivi-
sion  (b)  of this section and such bonds and notes shall contain on the
face thereof a statement to such effect. Except for purposes of  comply-
ing  with  the internal revenue code, any interest income earned on bond
proceeds shall only be used to pay debt service on such bonds.
  S 32. 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 34 of part I of chapter 55 of the laws  of  2014,  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

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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,  the  New  York  works economic development fund, projects for the
retention of professional football in western New York, the empire state
economic development fund, the  clarkson-trudeau  partnership,  the  New
York  genome  center, the cornell university college of veterinary medi-
cine, the olympic regional development  authority,  a  project  at  nano
Utica,  onondaga  county  revitalization projects, BINGHAMTON UNIVERSITY
SCHOOL OF PHARMACY, NEW YORK POWER ELECTRONICS MANUFACTURING CONSORTIUM,
REGIONAL INFRASTRUCTURE PROJECTS, 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 two billion [two] EIGHT
hundred [three] EIGHTY-EIGHT million two  hundred  fifty-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, the New
York works economic development fund,  projects  for  the  retention  of
professional  football  in  western  New York, the empire state economic
development fund, the clarkson-trudeau partnership, the New York  genome
center, the cornell university college of veterinary medicine, the olym-
pic  regional  development  authority, a project at nano Utica, onondaga
county revitalization projects, BINGHAMTON UNIVERSITY SCHOOL OF  PHARMA-
CY,  NEW  YORK  POWER  ELECTRONICS  MANUFACTURING  CONSORTIUM,  REGIONAL
INFRASTRUCTURE PROJECTS and  other  state  costs  associated  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 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

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and pledged by the dormitory authority and the corporation  as  security
for its bonds and notes, as authorized by this section.
  S 33. Subdivisions 1 and 3 of section 1285-p of the public authorities
law,  subdivision 1 as amended by section 55 of part HH of chapter 57 of
the laws of 2013 and subdivision 3 as amended by section 35 of part I of
chapter 55 of the laws of 2014, are amended to read as follows:
  1. Subject to chapter fifty-nine of the  laws  of  two  thousand,  but
notwithstanding any other provisions of law to the contrary, in order to
assist the corporation in undertaking the administration and the financ-
ing of the design, acquisition, construction, improvement, installation,
and related work for all or any portion of any of the following environ-
mental  infrastructure  projects  and  for the provision of funds to the
state for any amounts disbursed therefor: (a) projects authorized  under
the  environmental protection fund, or for which appropriations are made
to the environmental protection  fund  including,  but  not  limited  to
municipal   parks   and  historic  preservation,  stewardship,  farmland
protection, non-point source, pollution control, Hudson River Park, land
acquisition, and waterfront revitalization; (b) department  of  environ-
mental conservation capital appropriations for Onondaga Lake for certain
water  quality  improvement  projects in the same manner as set forth in
paragraph (d) of subdivision one of section 56-0303 of the environmental
conservation law; (c) for the purpose of the administration, management,
maintenance, and use of the real property at the western New York nucle-
ar service center; [and] (d) department  of  environmental  conservation
capital  appropriations  for  the  administration,  design, acquisition,
construction, improvement, installation, and related work on  department
of  environmental  conservation  environmental  infrastructure projects;
[and] (e) office of parks, recreation and historic  preservation  appro-
priations  or reappropriations from the state parks infrastructure fund;
[and] (f) capital grants for the cleaner,  greener  communities  program
AND  (G)  CAPITAL  COSTS  OF  WATER  QUALITY INFRASTRUCTURE PROJECTS the
director of the division of budget and the corporation are each  author-
ized  to  enter  into one or more service contracts, none of which shall
exceed twenty years in duration, upon such terms and conditions  as  the
director and the corporation may agree, so as to annually provide to the
corporation  in  the  aggregate,  a  sum  not  to exceed the annual debt
service payments and related expenses required for any bonds  and  notes
authorized  pursuant to section twelve hundred ninety of this title. Any
service contract entered into pursuant to  this  section  shall  provide
that  the  obligation of the state to fund or to pay the amounts therein
provided for shall not constitute a debt of the state within the meaning
of any constitutional or statutory provision and shall be deemed  execu-
tory  only  to the extent of moneys available for such purposes, subject
to annual appropriation by the legislature. Any such service contract or
any payments made or to be made thereunder may be assigned  and  pledged
by  the  corporation  as security for its bonds and notes, as authorized
pursuant to section twelve hundred ninety of this title.
  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 [three] SEVEN hundred [ninety-eight] SEVEN-
TY-FIVE million [two] 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

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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  34.  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 37 of part I of chapter 55 of the laws
of 2014, is amended to read as follows:
  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
[$330,000,000]  $440,000,000, 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  35.  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 38 of
part I of chapter 55 of the laws of 2014, 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 $197,000,000 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 [$317,800,000] $469,800,000, 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

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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 36. Subdivision 1 of section 386-b of the public authorities law, as
amended  by  section  39 of part I of chapter 55 of the laws of 2014, is
amended to read as follows:
  1. Notwithstanding any other provision of law  to  the  contrary,  the
authority, the dormitory authority and the urban development corporation
are  hereby authorized to issue bonds or notes in one or more series for
the purpose of financing peace bridge  projects  and  capital  costs  of
state and local highways, parkways, bridges, the New York state thruway,
Indian reservation roads, and facilities, and transportation infrastruc-
ture   projects   including  aviation  projects,  non-MTA  mass  transit
projects, and rail service preservation projects, including work  appur-
tenant  and  ancillary  thereto. The aggregate principal amount of bonds
authorized to be issued pursuant to this section shall not exceed [four]
ONE  BILLION   SIX   hundred   [sixty-five]   NINETY   million   dollars
[($465,000,000)]  $1,690,000,000,  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 37. Paragraph (c) of subdivision 19 of section 1680  of  the  public
authorities law, as amended by section 40 of part I of chapter 55 of the
laws of 2014, 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]   ELEVEN   billion   [nine]   TWO  hundred  [eighty-four]
TWENTY-EIGHT 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 universi-
ty  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

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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
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  38.  Paragraph  (c) of subdivision 14 of section 1680 of the public
authorities law, as amended by section 41 of part I of chapter 55 of the
laws of 2014, 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-
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  seven billion [two] THREE hundred
[seventy-three] NINETY-TWO million [three]  SEVEN  hundred  [thirty-one]
FIFTY-THREE  thousand  dollars.  The  legislature  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 coven-
anting or making any other agreements with or for the benefit  of  bond-
holders which might in any way affect such right.
  S  39. Subdivision 10-a of section 1680 of the public authorities law,
as amended by section 42 of part I of chapter 55 of the laws of 2014, is
amended to read as follows:

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  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 [seven] EIGHT hundred
[seventy-six]  THIRTY-EIGHT  million   [three]   FOUR   hundred   [five]
FIFTY-EIGHT  thousand  dollars.  Such amount shall be exclusive of bonds
and notes issued to fund any reserve fund or funds,  costs  of  issuance
and  to  refund any outstanding bonds and notes, issued on behalf of the
state, relating to a locally sponsored community college.
  S 40. Section 1680-r of  the  public  authorities  law,  as  added  by
section  43  of  part I of chapter 55 of the laws of 2014, is amended to
read as follows:
  S 1680-r. Authorization for the issuance  of  bonds  for  the  capital
restructuring financing program AND THE HEALTH CARE FACILITY TRANSFORMA-
TION  PROGRAM. 1. Notwithstanding the provisions of any other law to the
contrary, the dormitory authority and the urban development  corporation
are  hereby authorized to issue bonds or notes in one or more series for
the purpose of funding  project  costs  for  the  capital  restructuring
financing program for health care and related facilities licensed pursu-
ant  to  the public health law or the mental hygiene law and other state
costs associated with such capital projects AND THE HEALTH CARE FACILITY
TRANSFORMATION PROGRAM.  The aggregate principal amount of bonds author-
ized to be issued pursuant to this section shall not  exceed  [one]  TWO
billion  two hundred 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 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  dormitory authority and the urban development corporation for prin-
cipal, 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 urban development corpo-
ration in undertaking the financing for project costs  for  the  capital
restructuring  financing  program for health care and related facilities
licensed pursuant to the public health law or the mental hygiene law and
other state costs associated with such capital projects AND  THE  HEALTH
CARE  FACILITY  TRANSFORMATION  PROGRAM,  the  director of the budget is
hereby authorized to enter into one or more service contracts  with  the
dormitory authority and the urban development corporation, none of which
shall exceed thirty years in duration, upon such terms and conditions as
the  director  of  the  budget and the dormitory authority and the urban
development corporation agree, so as to annually provide to the dormito-
ry authority and the urban development 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

S. 4610--A                         125                        A. 6721--A

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 urban develop-
ment corporation as security for its bonds and notes, as  authorized  by
this section.
  S 41. Subdivision 1 of section 17 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
section  44  of  part I of chapter 55 of the laws of 2014, 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 [four] SIX hundred [sixty-five]
ELEVEN million [three] TWO hundred [sixty-five] FIFTEEN thousand dollars
[($465,365,000)]  ($611,215,000),  which  authorization  increases   the
aggregate principal amount of bonds, notes and other obligations author-
ized by section 40 of chapter 309 of the laws of 1996, and shall include
all bonds, notes and other obligations issued pursuant to chapter 211 of
the  laws  of  1990,  as  amended  or supplemented. The proceeds of such
bonds, notes or other obligations shall be paid to the state, for depos-
it in the youth facilities improvement fund,  to  pay  for  all  or  any
portion  of  the amount or amounts paid by the state from appropriations
or reappropriations made to the office of children and  family  services
from  the  youth  facilities  improvement fund for capital projects. The
aggregate amount of bonds, notes and 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 office of children and
family services; 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  [four]  SIX  hundred
[sixty-five]  ELEVEN  million  [three]  TWO hundred [sixty-five] FIFTEEN
thousand dollars [($465,365,000)] ($611,215,000), only  if  the  present
value of the aggregate 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  obli-
gations  so to be refunded or repaid. For the purposes hereof, the pres-
ent 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 refund-
ing or repayment bonds, notes or  other  obligations  from  the  payment
dates  thereof 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 esti-
mated accrued interest from the sale thereof.
  S  42.  Paragraph  b  of  subdivision 2 of section 9-a of section 1 of
chapter 392 of the laws of 1973, constituting the New York state medical

S. 4610--A                         126                        A. 6721--A

care facilities finance agency act, as amended by section 46 of  part  I
of chapter 55 of the laws of 2014, is amended to read as follows:
  b.  The  agency shall have power and is hereby authorized from time to
time to issue negotiable bonds and notes in conformity  with  applicable
provisions  of  the uniform commercial code in such principal amount as,
in the opinion of the agency, shall  be  necessary,  after  taking  into
account  other moneys which may be available for the purpose, to provide
sufficient funds to  the  facilities  development  corporation,  or  any
successor agency, for the financing or refinancing of or for the design,
construction, acquisition, reconstruction, rehabilitation or improvement
of  mental  health  services  facilities pursuant to paragraph a of this
subdivision, the payment of interest on mental health services  improve-
ment  bonds and mental health services improvement notes issued for such
purposes, the establishment of reserves to secure such bonds and  notes,
the  cost  or  premium  of  bond insurance or the costs of any financial
mechanisms which may be used to reduce the debt service  that  would  be
payable  by the agency on its mental health services facilities improve-
ment bonds and notes and all other expenditures of the  agency  incident
to  and  necessary or convenient to providing the facilities development
corporation, or any successor agency, with funds for  the  financing  or
refinancing of or for any such design, construction, acquisition, recon-
struction, rehabilitation or improvement and for the refunding of mental
hygiene improvement bonds issued pursuant to section 47-b of the private
housing  finance law; provided, however, that the agency shall not issue
mental health services facilities improvement bonds  and  mental  health
services  facilities  improvement notes in an aggregate principal amount
exceeding seven billion [four] SEVEN  hundred  [thirty-five]  TWENTY-TWO
million  eight hundred fifteen thousand dollars, excluding mental health
services facilities improvement bonds and mental health services facili-
ties improvement  notes  issued  to  refund  outstanding  mental  health
services facilities improvement bonds and mental health services facili-
ties  improvement notes; provided, however, that upon any such refunding
or repayment of mental  health  services  facilities  improvement  bonds
and/or  mental  health  services  facilities improvement notes the total
aggregate principal amount of outstanding mental health services facili-
ties improvement bonds and mental health  facilities  improvement  notes
may  be  greater  than  seven billion [four] SEVEN hundred [thirty-five]
TWENTY-TWO million eight  hundred  fifteen  thousand  dollars  only  if,
except  as  hereinafter  provided with respect to mental health services
facilities bonds and mental health services facilities notes  issued  to
refund mental hygiene improvement bonds authorized to be issued pursuant
to  the  provisions  of section 47-b of the private housing finance law,
the present value of the aggregate debt  service  of  the  refunding  or
repayment  bonds  to be issued shall not exceed the present value of the
aggregate debt service of the  bonds  to  be  refunded  or  repaid.  For
purposes hereof, the present values 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  obli-
gations, 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 thereof 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

S. 4610--A                         127                        A. 6721--A

the authority including estimated accrued interest from the sale  there-
of.  Such  bonds,  other  than bonds issued to refund outstanding bonds,
shall be scheduled to mature over a  term  not  to  exceed  the  average
useful  life, as certified by the facilities development corporation, of
the projects for which the bonds are issued, and in any case  shall  not
exceed  thirty  years  and the maximum maturity of notes or any renewals
thereof shall not exceed five years from the date of the original  issue
of such notes. Notwithstanding the provisions of this section, the agen-
cy  shall have the power and is hereby authorized to issue mental health
services facilities improvement  bonds  and/or  mental  health  services
facilities  improvement  notes  to  refund  outstanding  mental  hygiene
improvement bonds authorized to be issued pursuant to the provisions  of
section  47-b of the private housing finance law and the amount of bonds
issued or outstanding for  such  purposes  shall  not  be  included  for
purposes  of  determining  the  amount  of bonds issued pursuant to this
section. The director of the budget shall allocate the aggregate princi-
pal authorized to be issued by the agency among  the  office  of  mental
health,  office  for  people  with  developmental  disabilities, and the
office of alcoholism and substance abuse services, in consultation  with
their respective commissioners to finance bondable appropriations previ-
ously approved by the legislature.
  S  43.  Paragraph  (b) of subdivision 3 of section 1 and clause (B) of
subparagraph (iii) of paragraph (j) of subdivision 4  of  section  1  of
part D of chapter 63 of the laws of 2005 relating to the composition and
responsibilities of the New York state higher education capital matching
grant  board,  as amended by section 46-c of part I of chapter 55 of the
laws of 2014, is amended to read as follows:
  (b) Within amounts appropriated therefor, the board is hereby  author-
ized  and  directed  to award matching capital grants totaling [180] 210
million dollars. Each college shall be eligible for a grant award amount
as determined by the calculations pursuant to subdivision five  of  this
section.  In  addition,  such  colleges shall be eligible to compete for
additional funds pursuant to paragraph (h) of subdivision four  of  this
section.
  (B)  The  dormitory authority shall not issue any bonds or notes in an
amount in excess of [180] 210 million dollars for the purposes  of  this
section;  excluding  bonds  or  notes  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. Except for purposes of complying with the internal revenue
code,  any  interest  on  bond  proceeds  shall only be used to pay debt
service on such bonds.
  S 44. Subdivision 1 of section 49 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 46-a of part I of chapter  55  of  the
laws of 2014, is amended to read as follows:
  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 state and municipal facilities program  and  other
state costs associated with such capital projects. The aggregate princi-
pal  amount  of  bonds  authorized to be issued pursuant to this section
shall not exceed [seven hundred seventy] ONE BILLION ONE HUNDRED  FIFTY-
FIVE  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  previ-

S. 4610--A                         128                        A. 6721--A

ously  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.
  S 45. Intentionally omitted.
  S 46. Subdivision 1 of section 386-a of the public authorities law, as
added by section 46 of part U of chapter 59 of  the  laws  of  2012,  is
amended to read as follows:
  1.  Notwithstanding  any  other  provision of law to the contrary, the
authority, the dormitory authority and the urban development corporation
are hereby authorized to issue bonds or notes in one or more series  for
the  purpose  of  assisting the metropolitan transportation authority in
the financing of transportation facilities  as  defined  in  subdivision
seventeen  of  section  twelve  hundred  sixty-one  of this chapter. The
aggregate principal amount of bonds authorized to be issued pursuant  to
this section shall not exceed ONE BILLION [seven] FIVE hundred [seventy]
TWENTY  million  dollars  [($770,000,000)]  ($1,520,000,000),  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 devel-
opment  corporation for principal, interest, and related expenses pursu-
ant to a service contract and such bonds and notes shall contain on  the
face  thereof a statement to such effect. Except for purposes of comply-
ing with the internal revenue code, any interest income earned  on  bond
proceeds shall only be used to pay debt service on such bonds.
  S  47.  This  act shall take effect immediately and shall be deemed to
have been in full force and effect on and after April 1, 2015; provided,
however, that the provisions of sections one through eight and  sections
thirteen  through  twenty  of this act shall expire March 31, 2016, when
upon such date the provisions of such sections shall be deemed repealed.

                                 PART J

  Section 1. The public health law is amended by adding  a  new  section
2825-a to read as follows:
  S  2825-A.  HEALTH  CARE FACILITY TRANSFORMATION PROGRAM: KINGS COUNTY
PROJECT. 1. A KINGS COUNTY HEALTH CARE FACILITY  TRANSFORMATION  PROGRAM
IS HEREBY ESTABLISHED UNDER THE JOINT ADMINISTRATION OF THE COMMISSIONER
AND  THE  PRESIDENT  OF THE DORMITORY AUTHORITY OF THE STATE OF NEW YORK
FOR THE PURPOSE OF STRENGTHENING  AND  PROTECTING  CONTINUED  ACCESS  TO
HEALTH  CARE  SERVICES IN COMMUNITIES. THE PROGRAM SHALL PROVIDE CAPITAL
FUNDING IN SUPPORT OF PROJECTS THAT  REPLACE  INEFFICIENT  AND  OUTDATED
FACILITIES  AS  PART  OF  A  MERGER, CONSOLIDATION, ACQUISITION OR OTHER
SIGNIFICANT CORPORATE RESTRUCTURING ACTIVITY INTENDED TO CREATE A FINAN-
CIALLY SUSTAINABLE SYSTEM OF CARE. THE ISSUANCE OF ANY  BONDS  OR  NOTES
HEREUNDER  SHALL BE SUBJECT TO THE APPROVAL OF THE DIRECTOR OF THE DIVI-
SION OF THE BUDGET, AND ANY PROJECTS  FUNDED  THROUGH  THE  ISSUANCE  OF

S. 4610--A                         129                        A. 6721--A

BONDS  OR NOTES HEREUNDER SHALL BE APPROVED BY THE NEW YORK STATE PUBLIC
AUTHORITIES CONTROL BOARD, AS REQUIRED UNDER SECTION  FIFTY-ONE  OF  THE
PUBLIC AUTHORITIES LAW.
  2.  THE  COMMISSIONER  AND  THE PRESIDENT OF THE AUTHORITY SHALL ENTER
INTO AN AGREEMENT, SUBJECT TO APPROVAL BY THE DIRECTOR  OF  THE  BUDGET,
AND  SUBJECT  TO SECTION SIXTEEN HUNDRED EIGHTY-R OF THE PUBLIC AUTHORI-
TIES LAW, FOR THE PURPOSES OF AWARDING, DISTRIBUTING, AND  ADMINISTERING
THE  FUNDS  MADE  AVAILABLE  PURSUANT TO THIS SECTION. SUCH FUNDS MAY BE
DISTRIBUTED BY THE COMMISSIONER AND THE PRESIDENT OF THE  AUTHORITY  FOR
CAPITAL GRANTS TO GENERAL HOSPITALS, RESIDENTIAL HEALTH CARE FACILITIES,
DIAGNOSTIC  AND TREATMENT CENTERS, PRIMARY CARE PROVIDERS, AND HOME CARE
PROVIDERS, CERTIFIED OR LICENSED PURSUANT TO ARTICLE THIRTY-SIX OF  THIS
CHAPTER,  FOR CAPITAL NON-OPERATIONAL WORKS OR PURPOSES THAT SUPPORT THE
PURPOSES SET FORTH IN THIS SECTION. A COPY OF SUCH  AGREEMENT,  AND  ANY
AMENDMENTS THERETO, SHALL BE PROVIDED TO THE CHAIR OF THE SENATE FINANCE
COMMITTEE,  THE  CHAIR OF THE ASSEMBLY WAYS AND MEANS COMMITTEE, AND THE
DIRECTOR OF THE DIVISION OF BUDGET NO LATER THAN THIRTY  DAYS  PRIOR  TO
THE  RELEASE  OF  A  REQUEST  FOR  APPLICATIONS  FOR  FUNDING UNDER THIS
PROGRAM. PROJECTS AWARDED UNDER SECTION TWENTY-EIGHT HUNDRED TWENTY-FIVE
OF THIS ARTICLE SHALL NOT BE ELIGIBLE FOR GRANTS OR AWARDS  MADE  AVAIL-
ABLE UNDER THIS SECTION.
  3.  NOTWITHSTANDING  SECTION  ONE  HUNDRED  SIXTY-THREE  OF  THE STATE
FINANCE LAW OR ANY INCONSISTENT PROVISION OF LAW TO THE CONTRARY, UP  TO
SEVEN HUNDRED MILLION DOLLARS OF THE FUNDS APPROPRIATED FOR THIS PROGRAM
SHALL BE AWARDED WITHOUT A COMPETITIVE BID OR REQUEST FOR PROPOSAL PROC-
ESS FOR CAPITAL GRANTS TO HEALTH CARE PROVIDERS (HEREAFTER "APPLICANTS")
LOCATED IN THE COUNTY OF KINGS.
  (A)  ELIGIBLE  APPLICANTS  SHALL SERVE COMMUNITIES WHOSE RESIDENTS ARE
EXPERIENCING SIGNIFICANT LEVELS OF HEALTH CARE  DISPARITIES  AND  HEALTH
CARE  NEEDS  COMPARED TO OTHER COMMUNITIES WITHIN THE COUNTY OF KINGS AS
EVIDENCED BY:
  (I) A HIGH NUMBER OF MEDICAID ENROLLEES AND UNINSURED INDIVIDUALS;
  (II) ELEVATED BLOOD LEAD LEVEL RATES AMONG  CHILDREN,  HIGH  RATES  OF
DIABETES,  HIGH  BLOOD PRESSURE, ASTHMA, OBESITY, INFANT DEATH OR PREMA-
TURE BIRTH,  HEART  FAILURE,  BEHAVIORAL  HEALTH  CONDITIONS,  SUBSTANCE
ABUSE;
  (III)  LOW  LEVELS  OF  INCOME, HIGH RATES OF UNEMPLOYMENT, DISTRESSED
HOUSING CONDITIONS, AND POOR NUTRITIONAL STATUS;
  (IV) OTHER RISK FACTORS AS DETERMINED  BY  THE  COMMISSIONER  AND  THE
PRESIDENT OF THE AUTHORITY; AND
  (B) SUCH ELIGIBLE APPLICANT SHALL:
  (I)  (A) HAVE A LOSS FROM OPERATIONS FOR EACH OF THE THREE CONSECUTIVE
PRECEDING YEARS AS EVIDENCED BY AUDITED FINANCIAL STATEMENTS;
  (B) HAVE A NEGATIVE FUND BALANCE OR NEGATIVE EQUITY POSITION  IN  EACH
OF  THE  THREE  PRECEDING YEARS AS EVIDENCED BY AUDITED FINANCIAL STATE-
MENTS; AND
  (C) HAVE A CURRENT RATIO OF LESS THAN 1:1 FOR EACH  OF  THREE  CONSEC-
UTIVE PRECEDING YEARS; OR
  (II)  BE  DEEMED BY THE COMMISSIONER AND PRESIDENT OF THE AUTHORITY TO
BE A PROVIDER THAT FULFILLS OR WILL FULFILL AN UNMET  HEALTH  CARE  NEED
FOR  ACUTE  INPATIENT,  OUTPATIENT,  PRIMARY  OR RESIDENTIAL HEALTH CARE
SERVICES IN A COMMUNITY.
  4. IN DETERMINING AWARDS FOR ELIGIBLE APPLICANTS UNDER  THIS  SECTION,
THE  COMMISSIONER  AND  THE  PRESIDENT  OF  THE AUTHORITY SHALL CONSIDER
CRITERIA INCLUDING, BUT NOT LIMITED TO:

S. 4610--A                         130                        A. 6721--A

  (A) THE EXTENT TO WHICH THE PROPOSED CAPITAL PROJECT  WILL  CONTRIBUTE
TO  THE  LONG  TERM  SUSTAINABILITY  OF THE APPLICANT OR PRESERVATION OF
ESSENTIAL HEALTH SERVICES IN THE COMMUNITY OR COMMUNITIES SERVED BY  THE
APPLICANT;
  (B)  THE  EXTENT  TO  WHICH THE PROPOSED PROJECT OR PURPOSE IS ALIGNED
WITH DELIVERY SYSTEM REFORM INCENTIVE PAYMENT  ("DSRIP")  PROGRAM  GOALS
AND OBJECTIVES;
  (C)  THE RELATIONSHIP BETWEEN THE PROPOSED CAPITAL PROJECT AND IDENTI-
FIED COMMUNITY NEED;
  (D) THE EXTENT THAT THE PROPOSED CAPITAL PROJECT FURTHERS THE DEVELOP-
MENT OF PRIMARY CARE AND OTHER OUTPATIENT SERVICES;
  (E) THE EXTENT TO WHICH THE PROPOSED CAPITAL PROJECT BENEFITS MEDICAID
ENROLLEES AND UNINSURED INDIVIDUALS;
  (F) THE EXTENT TO  WHICH  THE  APPLICANT  HAS  ENGAGED  THE  COMMUNITY
AFFECTED  BY THE PROPOSED CAPITAL PROJECT AND THE MANNER IN WHICH COMMU-
NITY ENGAGEMENT HAS SHAPED SUCH CAPITAL PROJECT; AND
  (G) THE EXTENT TO WHICH THE PROPOSED CAPITAL PROJECT ADDRESSES  POTEN-
TIAL RISK TO PATIENT SAFETY AND WELFARE.
  5.  THE  DEPARTMENT SHALL PROVIDE A REPORT ON A QUARTERLY BASIS TO THE
CHAIRS OF THE SENATE FINANCE, ASSEMBLY WAYS AND MEANS, SENATE HEALTH AND
ASSEMBLY HEALTH COMMITTEES. SUCH REPORTS SHALL  BE  SUBMITTED  NO  LATER
THAN SIXTY DAYS AFTER THE CLOSE OF THE QUARTER, AND SHALL CONFORM TO THE
REPORTING  REQUIREMENTS  OF  SUBDIVISION  TWENTY OF SECTION TWENTY-EIGHT
HUNDRED SEVEN OF THIS ARTICLE, AS APPLICABLE.
  S 2. The public health law is amended by adding a new  section  2825-b
to read as follows:
  S  2825-B.  ONEIDA COUNTY HEALTH CARE FACILITY TRANSFORMATION PROGRAM:
ONEIDA COUNTY PROJECT. 1. AN ONEIDA COUNTY HEALTH CARE  FACILITY  TRANS-
FORMATION  PROGRAM  IS HEREBY ESTABLISHED UNDER THE JOINT ADMINISTRATION
OF THE COMMISSIONER AND THE PRESIDENT OF THE DORMITORY AUTHORITY OF  THE
STATE  OF  NEW  YORK  FOR  THE  PURPOSE  OF STRENGTHENING AND PROTECTING
CONTINUED ACCESS TO HEALTH CARE SERVICES  IN  COMMUNITIES.  THE  PROGRAM
SHALL  PROVIDE  CAPITAL  FUNDING  IN  SUPPORT OF PROJECTS LOCATED IN THE
LARGEST POPULATION CENTER IN ONEIDA  COUNTY  THAT  CONSOLIDATE  MULTIPLE
LICENSED  HEALTH  CARE FACILITIES INTO AN INTEGRATED SYSTEM OF CARE. THE
ISSUANCE OF ANY BONDS  OR  NOTES  HEREUNDER  SHALL  BE  SUBJECT  TO  THE
APPROVAL OF THE DIRECTOR OF THE DIVISION OF THE BUDGET, AND ANY PROJECTS
FUNDED  THROUGH  THE  ISSUANCE  OF  BONDS  OR  NOTES  HEREUNDER SHALL BE
APPROVED BY THE NEW YORK STATE  PUBLIC  AUTHORITIES  CONTROL  BOARD,  AS
REQUIRED UNDER SECTION FIFTY-ONE OF THE PUBLIC AUTHORITIES LAW.
  2.  THE  COMMISSIONER  AND  THE PRESIDENT OF THE AUTHORITY SHALL ENTER
INTO AN AGREEMENT, SUBJECT TO APPROVAL BY THE DIRECTOR  OF  THE  BUDGET,
AND  SUBJECT  TO SECTION SIXTEEN HUNDRED EIGHTY-R OF THE PUBLIC AUTHORI-
TIES LAW, FOR THE PURPOSES OF AWARDING, DISTRIBUTING, AND  ADMINISTERING
THE  FUNDS  MADE  AVAILABLE  PURSUANT TO THIS SECTION. SUCH FUNDS MAY BE
DISTRIBUTED BY THE COMMISSIONER AND THE PRESIDENT OF THE  AUTHORITY  FOR
CAPITAL  GRANTS  TO  GENERAL HOSPITALS FOR THE PURPOSES OF CONSOLIDATING
MULTIPLE LICENSED HEALTH CARE FACILITIES INTO AN  INTEGRATED  SYSTEM  OF
CARE  FOR  CAPITAL  NON-OPERATIONAL  WORKS  OR PURPOSES THAT SUPPORT THE
PURPOSES SET FORTH IN THIS SECTION. A COPY OF SUCH  AGREEMENT,  AND  ANY
AMENDMENTS THERETO, SHALL BE PROVIDED TO THE CHAIR OF THE SENATE FINANCE
COMMITTEE,  THE  CHAIR OF THE ASSEMBLY WAYS AND MEANS COMMITTEE, AND THE
DIRECTOR OF THE DIVISION OF BUDGET NO LATER THAN THIRTY  DAYS  PRIOR  TO
THE  RELEASE  OF  A  REQUEST  FOR  APPLICATIONS  FOR  FUNDING UNDER THIS
PROGRAM. PROJECTS AWARDED UNDER SECTION TWENTY-EIGHT HUNDRED TWENTY-FIVE

S. 4610--A                         131                        A. 6721--A

OF THIS ARTICLE SHALL NOT BE ELIGIBLE FOR GRANTS OR AWARDS  MADE  AVAIL-
ABLE UNDER THIS SECTION.
  3.  NOTWITHSTANDING  SECTION  ONE  HUNDRED  SIXTY-THREE  OF  THE STATE
FINANCE LAW OR ANY INCONSISTENT PROVISION OF LAW TO THE CONTRARY, UP  TO
THREE HUNDRED MILLION DOLLARS OF THE FUNDS APPROPRIATED FOR THIS PROGRAM
SHALL BE AWARDED WITHOUT A COMPETITIVE BID OR REQUEST FOR PROPOSAL PROC-
ESS FOR CAPITAL GRANTS TO HEALTH CARE PROVIDERS (HEREAFTER "APPLICANTS")
LOCATED IN THE COUNTY OF ONEIDA.
  4.  IN  DETERMINING AWARDS FOR ELIGIBLE APPLICANTS UNDER THIS SECTION,
THE COMMISSIONER AND THE  PRESIDENT  OF  THE  AUTHORITY  SHALL  CONSIDER
CRITERIA INCLUDING, BUT NOT LIMITED TO:
  (A)  THE  EXTENT TO WHICH THE PROPOSED CAPITAL PROJECT WILL CONTRIBUTE
TO THE INTEGRATION OF HEALTH CARE SERVICES AND LONG TERM  SUSTAINABILITY
OF  THE  APPLICANT  OR  PRESERVATION OF ESSENTIAL HEALTH SERVICES IN THE
COMMUNITY OR COMMUNITIES SERVED BY THE APPLICANT;
  (B) THE EXTENT TO WHICH THE PROPOSED PROJECT  OR  PURPOSE  IS  ALIGNED
WITH  DELIVERY  SYSTEM  REFORM INCENTIVE PAYMENT ("DSRIP") PROGRAM GOALS
AND OBJECTIVES;
  (C) THE RELATIONSHIP BETWEEN THE PROPOSED CAPITAL PROJECT AND  IDENTI-
FIED COMMUNITY NEED;
  (D) THE EXTENT THAT THE PROPOSED CAPITAL PROJECT FURTHERS THE DEVELOP-
MENT OF PRIMARY CARE AND OTHER OUTPATIENT SERVICES;
  (E) THE EXTENT TO WHICH THE PROPOSED CAPITAL PROJECT BENEFITS MEDICAID
ENROLLEES AND UNINSURED INDIVIDUALS;
  (F)  THE  EXTENT  TO  WHICH  THE  APPLICANT  HAS ENGAGED THE COMMUNITY
AFFECTED BY THE PROPOSED CAPITAL PROJECT AND THE MANNER IN WHICH  COMMU-
NITY ENGAGEMENT HAS SHAPED SUCH CAPITAL PROJECT; AND
  (G)  THE EXTENT TO WHICH THE PROPOSED CAPITAL PROJECT ADDRESSES POTEN-
TIAL RISK TO PATIENT SAFETY AND WELFARE.
  5. THE DEPARTMENT SHALL PROVIDE A REPORT ON A QUARTERLY BASIS  TO  THE
CHAIRS OF THE SENATE FINANCE, ASSEMBLY WAYS AND MEANS, SENATE HEALTH AND
ASSEMBLY  HEALTH  COMMITTEES.  SUCH  REPORTS SHALL BE SUBMITTED NO LATER
THAN SIXTY DAYS AFTER THE CLOSE OF THE QUARTER, AND SHALL CONFORM TO THE
REPORTING REQUIREMENTS OF SUBDIVISION  TWENTY  OF  SECTION  TWENTY-EIGHT
HUNDRED SEVEN OF THIS ARTICLE, AS APPLICABLE.
  S  3.  The public health law is amended by adding a new section 2825-c
to read as follows:
  S 2825-C. ESSENTIAL HEALTH CARE PROVIDER SUPPORT PROGRAM.  1. NOTWITH-
STANDING SECTION ONE HUNDRED SIXTY-THREE OF THE STATE  FINANCE  LAW,  OR
ANY INCONSISTENT PROVISION OF LAW TO THE CONTRARY, WITHIN AMOUNTS APPRO-
PRIATED,  FUNDS  MAY  BE  ALLOCATED  AND DISTRIBUTED BY THE COMMISSIONER
WITHOUT A COMPETITIVE BID OR REQUEST FOR PROPOSAL PROCESS, FOR GRANTS TO
ESSENTIAL HEALTH CARE PROVIDERS  TO  SUPPORT  DEBT  RETIREMENT,  CAPITAL
PROJECTS OR NON-CAPITAL PROJECTS THAT FACILITATE HEALTH CARE TRANSFORMA-
TION,  INCLUDING  MERGERS,  CONSOLIDATION,  AND RESTRUCTURING ACTIVITIES
INTENDED TO CREATE A FINANCIALLY  SUSTAINABLE  SYSTEM  OF  CARE.  GRANTS
SHALL  NOT  BE  AVAILABLE  TO  SUPPORT  GENERAL  OPERATING EXPENSES. FOR
PURPOSES OF THIS SECTION, AN ESSENTIAL HEALTH CARE PROVIDER IS A  HOSPI-
TAL  OR  HOSPITAL  SYSTEM  THAT,  IN THE DISCRETION OF THE COMMISSIONER,
OFFERS HEALTH CARE SERVICES WITHIN A  DEFINED  GEOGRAPHIC  REGION  WHERE
SUCH  SERVICES  WOULD OTHERWISE BE UNAVAILABLE TO THE POPULATION OF SUCH
REGION.
  2. THE COMMISSIONER SHALL AWARD GRANTS FOR  PROJECTS  CONSISTENT  WITH
THE PURPOSES OF THIS SECTION. ELIGIBLE APPLICANTS SHALL MEET THE FOLLOW-
ING CRITERIA:

S. 4610--A                         132                        A. 6721--A

  (A)  (I) HAVE A LOSS FROM OPERATIONS FOR EACH OF THE THREE CONSECUTIVE
PRECEDING YEARS AS EVIDENCED BY AUDITED FINANCIAL STATEMENTS;
  (II)  HAVE A NEGATIVE FUND BALANCE OR NEGATIVE EQUITY POSITION IN EACH
OF THE THREE PRECEDING YEARS AS EVIDENCED BY  AUDITED  FINANCIAL  STATE-
MENTS; AND
  (III)  HAVE A CURRENT RATIO OF LESS THAN 1:1 FOR EACH OF THREE CONSEC-
UTIVE PRECEDING YEARS; OR
  (B) BE DEEMED BY THE COMMISSIONER TO BE A PROVIDER  THAT  FULFILLS  OR
WILL  FULFILL  AN UNMET NEED FOR ACUTE INPATIENT, OUTPATIENT, PRIMARY OR
RESIDENTIAL HEALTH CARE SERVICES IN A DEFINED  GEOGRAPHIC  REGION  WHERE
SUCH  SERVICES  WOULD BE OTHERWISE UNAVAILABLE TO THE POPULATION OF SUCH
REGION.
  3. SUCH AWARDS SHALL BE DISTRIBUTED PURSUANT  TO  CRITERIA,  INCLUDING
BUT NOT LIMITED TO:
  (A)  THE  EXTENT  TO WHICH THE PROPOSED PROJECT WILL CONTRIBUTE TO THE
LONG TERM SUSTAINABILITY OF THE APPLICANT OR PRESERVATION  OF  ESSENTIAL
HEALTH CARE SERVICES IN A COMMUNITY;
  (B)  THE  EXTENT  TO  WHICH THE PROPOSED PROJECT OR PURPOSE IS ALIGNED
WITH DELIVERY SYSTEM REFORM INCENTIVE PAYMENT  ("DSRIP")  PROGRAM  GOALS
AND OBJECTIVES;
  (C) CONSIDERATION OF GEOGRAPHIC DISTRIBUTION OF FUNDS;
  (D)  THE  RELATIONSHIP  BETWEEN THE PROPOSED PROJECT AND AN IDENTIFIED
COMMUNITY NEED;
  (E) THE EXTENT TO  WHICH  THE  APPLICANT  HAS  ACCESS  TO  ALTERNATIVE
FINANCING;
  (F)  THE EXTENT TO WHICH THE PROPOSED PROJECT FURTHERS THE DEVELOPMENT
OF PRIMARY CARE;
  (G) THE EXTENT TO WHICH THE PROPOSED PROJECT BENEFITS MEDICAID  ENROL-
LEES AND UNINSURED INDIVIDUALS;
  (H)  THE  EXTENT  TO  WHICH  THE  APPLICANT  HAS ENGAGED THE COMMUNITY
AFFECTED BY THE PROPOSED PROJECT AND THE MANNER IN WHICH  THE  COMMUNITY
ENGAGEMENT HAS SHAPED SUCH PROJECT; AND
  (I)  THE EXTENT TO WHICH THE PROPOSED PROJECT ADDRESSES POTENTIAL RISK
TO PATIENT SAFETY AND WELFARE.
  4. DISBURSEMENT OF AWARDS MADE  PURSUANT  TO  THIS  SECTION  SHALL  BE
CONDITIONED  ON  THE  AWARDEE  ACHIEVING CERTAIN PROCESS AND PERFORMANCE
METRICS AND MILESTONES AS DETERMINED  IN  THE  SOLE  DISCRETION  OF  THE
COMMISSIONER.  SUCH METRICS AND MILESTONES SHALL BE STRUCTURED TO ENSURE
THAT THE HEALTH CARE TRANSFORMATION AND PROVIDER SUSTAINABILITY GOALS OF
THE PROJECT ARE ACHIEVED, AND  SUCH  METRICS  AND  MILESTONES  SHALL  BE
INCLUDED IN GRANT DISBURSEMENT AGREEMENTS OR OTHER CONTRACTUAL DOCUMENTS
AS REQUIRED BY THE COMMISSIONER.
  5.  THE DEPARTMENT SHALL PROVIDE A REPORT ON A QUARTERLY BASIS TO  THE
CHAIRS OF THE SENATE FINANCE, ASSEMBLY WAYS AND MEANS, SENATE HEALTH AND
ASSEMBLY HEALTH COMMITTEES. SUCH REPORTS SHALL  BE  SUBMITTED  NO  LATER
THAN  SIXTY  DAYS AFTER THE CLOSE OF THE QUARTER, AND SHALL INCLUDE, FOR
EACH AWARD, THE NAME OF THE APPLICANT, A DESCRIPTION OF THE  PROJECT  OR
PURPOSE,  THE  AMOUNT  OF  THE  AWARD,  DISBURSEMENT DATE, AND STATUS OF
ACHIEVEMENT OF PROCESS AND PERFORMANCE METRICS AND  MILESTONES  PURSUANT
TO SUBDIVISION FOUR OF THIS SECTION.
  S  4.  The  opening  paragraph of subdivision 3 of section 2825 of the
public health law, as added by section 8 of part A of chapter 60 of  the
laws of 2014, is amended to read as follows:
  The  commissioner  and the president of the authority shall enter into
an agreement, subject to approval by the  director  of  the  budget  and
subject  to  section  sixteen hundred eighty-r of the public authorities

S. 4610--A                         133                        A. 6721--A

law, as added by a chapter of the laws of two thousand fourteen, for the
purposes of awarding, distributing, and  administering  the  funds  made
available  pursuant  to  this  section. TO THE EXTENT PRACTICABLE, FUNDS
SHALL  BE  AWARDED REGIONALLY IN PROPORTION TO THE APPLICATIONS RECEIVED
FROM THE REQUEST FOR APPLICATION ISSUED BY  OR  BEFORE  MAY  FIRST,  TWO
THOUSAND  FIFTEEN.  PROJECTS AWARDED UNDER SECTIONS TWENTY-EIGHT HUNDRED
TWENTY-FIVE-A AND TWENTY-EIGHT HUNDRED  TWENTY-FIVE-B  OF  THIS  ARTICLE
SHALL  NOT  BE  ELIGIBLE  FOR GRANTS OR AWARDS MADE AVAILABLE UNDER THIS
SECTION.
  S 5. The public health law is amended by adding a new  section  2815-a
to read as follows:
  S  2815-A.  COMMUNITY  HEALTH  CARE REVOLVING CAPITAL FUND. 1.   DEFI-
NITIONS. AS USED IN THIS SECTION, THE FOLLOWING WORDS AND PHRASES  SHALL
HAVE  THE  FOLLOWING  MEANINGS  UNLESS  A  DIFFERENT  MEANING IS PLAINLY
REQUIRED BY THE CONTEXT:
  A. "ADMINISTRATOR" SHALL MEAN A NOT FOR PROFIT  COMMUNITY  DEVELOPMENT
FINANCIAL INSTITUTION CDFI THAT IS CERTIFIED BY THE U.S. TREASURY COMMU-
NITY  DEVELOPMENT  FINANCIAL  FUND, HAS EXPERIENCE FINANCING PROJECTS IN
THE NEW YORK STATE HEALTHCARE SECTOR AND OTHERWISE  MEETS  THE  REQUIRE-
MENTS OF THIS SECTION.
  B.  "DORMITORY  AUTHORITY"  OR  "AUTHORITY"  SHALL  MEAN THE DORMITORY
AUTHORITY OF THE STATE OF NEW YORK CREATED  BY  TITLE  FOUR  OF  ARTICLE
EIGHT  OF  THE PUBLIC AUTHORITIES LAW WHICH HAS SUCCEEDED TO THE POWERS,
FUNCTIONS AND DUTIES OF  THE  MEDICAL  CARE  FACILITIES  FINANCE  AGENCY
PURSUANT  TO  CHAPTER EIGHTY-THREE OF THE LAWS OF NINETEEN HUNDRED NINE-
TY-FIVE.
  C. "PARTICIPATING BORROWER" SHALL MEAN A COMMUNITY-BASED  HEALTH  CARE
PROVIDER,  WHICH  FOR  THE PURPOSES OF THIS SECTION, SHALL BE DEFINED AS
DIAGNOSTIC AND TREATMENT CENTER LICENSED OR GRANTED AN OPERATING CERTIF-
ICATE UNDER ARTICLE TWENTY-EIGHT OF THIS CHAPTER, A MENTAL HEALTH CLINIC
LICENSED OR GRANTED AN OPERATING CERTIFICATE UNDER ARTICLE THIRTY-ONE OF
THE MENTAL HEALTH LAW; OR AN ALCOHOL AND SUBSTANCE ABUSE TREATMENT CLIN-
IC LICENSED OR GRANTED AN OPERATING CERTIFICATE UNDER ARTICLE THIRTY-TWO
OF THE MENTAL HYGIENE LAW, EACH ORGANIZED UNDER THE LAWS OF THIS STATE.
  D. "REVOLVING CAPITAL FUND" SHALL MEAN COMMUNITY HEALTH CARE REVOLVING
CAPITAL FUND AUTHORIZED TO BE ESTABLISHED BY THE DORMITORY AUTHORITY AND
ADMINISTERED PURSUANT TO THIS SECTION.
  2. REVOLVING CAPITAL  FUND.  THE  DORMITORY  AUTHORITY  SHALL,  WITHIN
AMOUNTS  APPROPRIATED,  ESTABLISH  THE  COMMUNITY  HEALTH CARE REVOLVING
CAPITAL FUND.  MONIES IN THE REVOLVING CAPITAL FUND  SHALL  BE  UTILIZED
FOR THE PURPOSE OF MAKING LOANS TO QUALIFYING PARTICIPATING BORROWERS TO
IMPROVE  ACCESS  TO  AFFORDABLE  CAPITAL FINANCING TO EXPAND AND IMPROVE
CAPACITY TO PROVIDE HEALTH CARE IN THE STATE. FUNDS SHALL BE TRANSFERRED
BY THE COMMISSIONER TO  THE  DORMITORY  AUTHORITY  FOR  DEPOSIT  IN  THE
REVOLVING  CAPITAL  FUND  IN  AN  AMOUNT AS AUTHORIZED BY APPROPRIATION.
MONIES IN THE FUND SHALL BE: (A) HELD BY THE AUTHORITY PURSUANT TO  THIS
SECTION  AS  CUSTODIAN  PURSUANT  TO  AN AGREEMENT WITH THE COMMISSIONER
UNTIL TRANSFERRED TO THE ADMINISTRATOR PURSUANT TO THIS SECTION, AND (B)
INVESTED BY THE AUTHORITY IN ACCORDANCE WITH THE  INVESTMENT  GUIDELINES
OF  THE  AUTHORITY  DURING  SAID CUSTODIAL PERIOD. ALL INVESTMENT INCOME
SHALL BE CREDITED TO, AND SHALL BE DEPOSITED IN, THE  REVOLVING  CAPITAL
FUND.
  3.  ADMINISTRATION AGREEMENT. THE COMMISSIONER AND THE AUTHORITY SHALL
ENTER INTO AN AGREEMENT, SUBJECT TO THE APPROVAL OF THE DIRECTOR OF  THE
BUDGET,  FOR  THE  PURPOSE  OF  ADMINISTERING THE FUNDS IN THE REVOLVING
CAPITAL FUND THROUGH AN ADMINISTRATOR. A COPY OF SUCH AGREEMENT, AND ANY

S. 4610--A                         134                        A. 6721--A

AMENDMENTS THERETO, SHALL BE PROVIDED TO THE CHAIR OF THE SENATE FINANCE
COMMITTEE, THE DIRECTOR OF THE DIVISION OF BUDGET, AND THE CHAIR OF  THE
ASSEMBLY  WAYS AND MEANS COMMITTEE. THE AGREEMENT SHALL SPECIFY THAT THE
ADMINISTRATOR SHALL ADMINISTER THE COMMUNITY HEALTH CARE REVOLVING CAPI-
TAL  FUND IN A MANNER THAT WILL BENEFIT THE PUBLIC HEALTH BY ENCOURAGING
IMPROVEMENTS IN THE COMMUNITY HEALTH CARE DELIVERY SYSTEM IN THE  STATE,
IN  COMPLIANCE  WITH  ALL  APPLICABLE LAWS, RULES, REGULATIONS AND OTHER
REQUIREMENTS.
  4. AGREEMENT WITH THE ADMINISTRATOR. THE DORMITORY AUTHORITY SHALL, IN
CONSULTATION WITH THE COMMISSIONER, ENTER INTO  AN  AGREEMENT  WITH  THE
ADMINISTRATOR.  SUCH  AGREEMENT  SHALL PROVIDE FOR THE ADMINISTRATION OF
THE  REVOLVING  CAPITAL  FUND  ADMINISTRATOR,  IN  ACCORDANCE  WITH  THE
REQUIREMENTS  OF  THIS SECTION, THE COMMISSIONER AND DORMITORY AUTHORITY
AND ALL APPLICABLE LAWS, RULES, REGULATIONS AND OTHER REQUIREMENTS. UPON
THE EFFECTIVE DATE OF THE AGREEMENT, CUSTODY OF, AND RESPONSIBILITY FOR,
THE REVOLVING CAPITAL FUND  SHALL  BE  TRANSFERRED  FROM  THE  DORMITORY
AUTHORITY  TO  THE  ADMINISTRATOR,  SUBJECT  TO  THE REQUIREMENTS OF THE
AGREEMENT. SUCH AGREEMENT SHALL INCLUDE, BUT  NOT  BE  LIMITED  TO,  THE
FOLLOWING PROVISIONS:
  A.  THAT  THE  ADMINISTRATOR  SHALL  BE  RESPONSIBLE  FOR THE RECEIPT,
MANAGEMENT AND EXPENDITURE OF MONIES HELD IN THE REVOLVING CAPITAL FUND;
  B. THAT THE ADMINISTRATOR SHALL MAINTAIN BOOKS AND RECORDS  PERTAINING
TO  ALL  MONIES  RECEIVED AND DISBURSED PURSUANT TO THIS SECTION AND THE
AGREEMENT;
  C. THAT MONIES IN SUCH REVOLVING CAPITAL FUND SHALL  BE  UTILIZED  FOR
THE  PURPOSE  OF  MAKING LOANS TO QUALIFYING PARTICIPATING BORROWERS, TO
PROVIDE PARTICIPATING BORROWERS WITH IMPROVED ACCESS TO AFFORDABLE CAPI-
TAL TO EXPAND AND IMPROVE PREVENTIVE OR PRIMARY CARE CAPACITY;
  D. THAT PARTICIPATING BORROWERS SHALL BE CHOSEN BY  THE  ADMINISTRATOR
THROUGH AN APPLICATION PROCESS APPROVED BY THE AUTHORITY AND THE COMMIS-
SIONER;
  E.  THAT  ELIGIBLE  USES OF FUNDS SO LOANED TO PARTICIPATING BORROWERS
SHALL INCLUDE BUT NOT BE LIMITED TO: (I) ELIGIBLE COSTS AS DESCRIBED  IN
PARAGRAPH   (F)  OF  THIS  SUBDIVISION,  ATTRIBUTABLE  TO  THE  PROPOSED
CONSTRUCTION, RECONSTRUCTION, RENOVATION, REHABILITATION,  REFURBISHING,
EXPANSION,  UPGRADING AND EQUIPPING OF A PARTICIPATING BORROWER'S COMMU-
NITY-BASED HEALTH CARE FACILITY; (II) RESERVES  FOR  CREDIT  ENHANCEMENT
INCLUDING LOAN GUARANTEES; (III) LOAN LOSS AND DEBT SERVICE RESERVES AND
SUBORDINATED  LOANS;  AND  (IV)  FACILITY FINANCING, INCLUDING LOANS FOR
PREDEVELOPMENT, ACQUISITION AND CONSTRUCTION,  PERMANENT  FINANCING  AND
BRIDGE LOANS;
  F.  THAT  ELIGIBLE  COSTS UNDER THIS SECTION SHALL INCLUDE, BUT NOT BE
LIMITED TO, ALL HARD CONSTRUCTION COSTS AND ASSOCIATED PROFESSIONAL  AND
OTHER  COSTS, FURNITURE, FIXTURES AND EQUIPMENT, INCLUDING HEALTH INFOR-
MATION TECHNOLOGY, ACQUISITION, PREDEVELOPMENT  DUE  DILIGENCE,  INITIAL
OPERATING EXPENSES AND WORKING CAPITAL;
  G.  THAT  THE  ADMINISTRATOR  ADMINISTERING THE REVOLVING CAPITAL FUND
SHALL REPORT QUARTERLY ON THE TRANSACTIONS IN THE REVOLVING CAPITAL FUND
IN A FORM AND MANNER SPECIFIED BY THE AUTHORITY IN CONSULTATION WITH THE
COMMISSIONER, INCLUDING BUT NOT LIMITED TO: RECEIPTS OR DEPOSITS TO  THE
FUND,  DISBURSEMENTS,  LOANS  OR  CREDIT ENHANCEMENT MADE FROM THE FUND,
INVESTMENT INCOME, AND THE BALANCE ON HAND AS OF THE END  OF  THE  MONTH
FOR EACH SUCH QUARTER;
  H. THAT THE ADMINISTRATOR SHALL BE REQUIRED TO INVEST MONIES ON DEPOS-
IT  IN  THE  FUND  IN  ACCORDANCE WITH INVESTMENT GUIDELINES MEETING THE
REQUIREMENTS OF THE DEPARTMENT AND DORMITORY AUTHORITY, AND ALL  INVEST-

S. 4610--A                         135                        A. 6721--A

MENT  INCOME SHALL BE CREDITED TO, AND ANY REPAYMENT OF LOANS AS HEREIN-
AFTER PROVIDED SHALL BE DEPOSITED IN, THE REVOLVING  CAPITAL  FUND,  AND
SPENT THEREFROM ONLY FOR THE PURPOSES SET FORTH IN THIS SECTION;
  I.  THAT  ONLY THE REASONABLE EXPENSES OF THE ADMINISTRATOR, AS DETER-
MINED BY THE COMMISSIONER AND PRESIDENT OF THE  AUTHORITY,  INCURRED  IN
THE  ESTABLISHMENT  AND  ADMINISTRATION  OF  THE  REVOLVING CAPITAL LOAN
PROGRAM (INCLUDING THE RETENTION OF PROFESSIONALS  AND  CONSULTANTS,  IF
ANY) MAY BE PAID OR REIMBURSED FROM THE REVOLVING CAPITAL FUND;
  J.  THAT REVOLVING CAPITAL FUND MONIES SHALL BE HELD IN TRUST AND USED
FOR THE BENEFIT OF ELIGIBLE COMMUNITY-BASED HEALTH CARE FACILITY CAPITAL
PROJECTS; AND
  K. ANY OTHER TERM OR CONDITION AS  DETERMINED  BY  THE  AUTHORITY,  IN
CONSULTATION WITH THE COMMISSIONER.
  5.  LOAN DOCUMENTATION. LOANS FROM THE REVOLVING CAPITAL FUND SHALL BE
MADE PURSUANT TO A WRITTEN LOAN AGREEMENT BETWEEN THE ADMINISTRATOR  AND
THE  PARTICIPATING  BORROWER,  SPECIFYING  THE  TERMS  THEREOF INCLUDING
REPAYMENT TERMS. THE LOAN AGREEMENT SHALL BE IN SUCH FORM AND CONTENT AS
SHALL BE ACCEPTABLE TO THE COMMISSIONER AND DORMITORY AUTHORITY, AND MAY
INCLUDE SUCH OTHER ANY FURTHER WRITTEN DOCUMENTATION  AND/OR  AGREEMENTS
AS  SHALL  BE REQUIRED IN THE JUDGMENT OF THE COMMISSIONER AND DORMITORY
AUTHORITY, INCLUDING BUT NOT LIMITED TO ALL REQUIRED FILINGS  UNDER  THE
UNIFORM COMMERCIAL CODE.
  S  6. Section 2826 of the public health law is amended by adding a new
subdivision (g) to read as follows:
  (G) NOTWITHSTANDING  SUBDIVISION  (A)  OF  THIS  SECTION,  AND  WITHIN
AMOUNTS  APPROPRIATED  FOR  SUCH  PURPOSES  AS DESCRIBED HEREIN, FOR THE
PERIOD OF APRIL FIRST, TWO THOUSAND FIFTEEN THROUGH MARCH  THIRTY-FIRST,
TWO  THOUSAND SIXTEEN, THE COMMISSIONER MAY AWARD A TEMPORARY ADJUSTMENT
TO THE NON-CAPITAL COMPONENTS OF RATES, OR MAKE TEMPORARY LUMP-SUM MEDI-
CAID PAYMENTS TO ELIGIBLE GENERAL HOSPITALS IN SEVERE FINANCIAL DISTRESS
TO ENABLE SUCH FACILITIES TO  MAINTAIN  OPERATIONS  AND  VITAL  SERVICES
WHILE SUCH FACILITIES ESTABLISH LONG TERM SOLUTIONS TO ACHIEVE SUSTAINA-
BLE HEALTH SERVICES.
  (I) ELIGIBLE GENERAL HOSPITALS SHALL INCLUDE:
  (A)  A  PUBLIC HOSPITAL, WHICH FOR PURPOSES OF THIS SUBDIVISION, SHALL
MEAN A GENERAL HOSPITAL OPERATED BY A COUNTY OR MUNICIPALITY, BUT  SHALL
EXCLUDE ANY SUCH HOSPITAL OPERATED BY A PUBLIC BENEFIT CORPORATION;
  (B) A FEDERALLY DESIGNATED CRITICAL ACCESS HOSPITAL;
  (C) A FEDERALLY DESIGNATED SOLE COMMUNITY HOSPITAL; OR
  (D)  A  GENERAL  HOSPITAL  THAT  IS  A  SAFETY NET HOSPITAL, WHICH FOR
PURPOSES OF THIS SUBDIVISION SHALL MEAN:
  (1) SUCH HOSPITAL  HAS  AT  LEAST  THIRTY  PERCENT  OF  ITS  INPATIENT
DISCHARGES  MADE UP OF MEDICAID ELIGIBLE INDIVIDUALS, UNINSURED INDIVID-
UALS  OR  MEDICAID  DUALLY  ELIGIBLE  INDIVIDUALS  AND  WITH  AT   LEAST
THIRTY-FIVE  PERCENT OF ITS OUTPATIENT VISITS MADE UP OF MEDICAID ELIGI-
BLE INDIVIDUALS, UNINSURED INDIVIDUALS OR MEDICAID DUALLY-ELIGIBLE INDI-
VIDUALS; OR
  (2) SUCH HOSPITAL SERVES AT LEAST THIRTY PERCENT OF THE RESIDENTS OF A
COUNTY OR A MULTI-COUNTY AREA WHO  ARE  MEDICAID  ELIGIBLE  INDIVIDUALS,
UNINSURED INDIVIDUALS OR MEDICAID DUALLY-ELIGIBLE INDIVIDUALS.
  (II)  ELIGIBLE  APPLICANTS  MUST  DEMONSTRATE THAT WITHOUT SUCH AWARD,
THEY WILL BE IN SEVERE FINANCIAL DISTRESS  THROUGH  MARCH  THIRTY-FIRST,
TWO THOUSAND SIXTEEN, AS EVIDENCED BY:
  (A)  CERTIFICATION THAT SUCH APPLICANT HAS LESS THAN FIFTEEN DAYS CASH
AND EQUIVALENTS;

S. 4610--A                         136                        A. 6721--A

  (B) SUCH APPLICANT HAS NO ASSETS THAT  CAN  BE  MONETIZED  OTHER  THAN
THOSE VITAL TO OPERATIONS; AND
  (C)  SUCH APPLICANT HAS EXHAUSTED ALL EFFORTS TO OBTAIN RESOURCES FROM
CORPORATE PARENTS AND AFFILIATED ENTITIES TO SUSTAIN OPERATIONS.
  (III) AWARDS UNDER THIS SUBDIVISION SHALL BE MADE UPON APPLICATION  TO
THE DEPARTMENT.
  (A)  APPLICATIONS  UNDER  THIS  SUBDIVISION SHALL INCLUDE A MULTI-YEAR
TRANSFORMATION PLAN THAT IS ALIGNED  WITH  THE  DELIVERY  SYSTEM  REFORM
INCENTIVE  PAYMENT  ("DSRIP")  PROGRAM  GOALS  AND OBJECTIVES. SUCH PLAN
SHALL BE APPROVED BY THE DEPARTMENT AND SHALL DEMONSTRATE A PATH TOWARDS
LONG TERM SUSTAINABILITY AND IMPROVED PATIENT CARE.
  (B) THE DEPARTMENT MAY AUTHORIZE INITIAL AWARD  PAYMENTS  TO  ELIGIBLE
APPLICANTS  BASED  SOLELY ON THE CRITERIA PURSUANT TO PARAGRAPHS (I) AND
(II) OF THIS SUBDIVISION.
  (C) NOTWITHSTANDING SUBPARAGRAPH (B) OF THIS PARAGRAPH, THE DEPARTMENT
MAY SUSPEND OR REPEAL AN AWARD IF AN ELIGIBLE APPLICANT FAILS TO  SUBMIT
A  MULTI-YEAR  TRANSFORMATION  PLAN PURSUANT TO SUBPARAGRAPH (A) OF THIS
PARAGRAPH THAT IS ACCEPTABLE TO THE DEPARTMENT  BY  NO  LATER  THAN  THE
THIRTIETH DAY OF SEPTEMBER TWO THOUSAND FIFTEEN.
  (D) APPLICANTS UNDER THIS SUBDIVISION SHALL DETAIL THE EXTENT TO WHICH
THE  AFFECTED  COMMUNITY  HAS  BEEN  ENGAGED  AND CONSULTED ON POTENTIAL
PROJECTS OF SUCH APPLICATION, AS WELL AS ANY  OUTREACH  TO  STAKEHOLDERS
AND HEALTH PLANS.
  (E)  THE  DEPARTMENT SHALL REVIEW ALL APPLICATIONS UNDER THIS SUBDIVI-
SION, AND A DETERMINE:
  (1) APPLICANT ELIGIBILITY;
  (2) EACH APPLICANT'S PROJECTED FINANCIAL STATUS;
  (3) EACH APPLICANT'S  PROPOSED  USE  OF  FUNDS  TO  MAINTAIN  CRITICAL
SERVICES NEEDED BY ITS COMMUNITY; AND
  (4) THE ANTICIPATED IMPACT OF THE LOSS OF SUCH SERVICES.
  (F)  AFTER  REVIEW  OF  ALL APPLICATIONS UNDER THIS SUBDIVISION, AND A
DETERMINATION OF THE AGGREGATE AMOUNT OF REQUESTED FUNDS, THE DEPARTMENT
SHALL MAKE AWARDS TO ELIGIBLE APPLICANTS; PROVIDED, HOWEVER,  THAT  SUCH
AWARDS  MAY  BE IN AN AMOUNT LOWER THAN SUCH REQUESTED FUNDING, ON A PER
APPLICANT OR AGGREGATE BASIS.
  (IV) AWARDS UNDER THIS SUBDIVISION MAY NOT BE USED FOR:
  (A) CAPITAL EXPENDITURES, INCLUDING, BUT NOT LIMITED TO: CONSTRUCTION,
RENOVATION AND ACQUISITION OF CAPITAL EQUIPMENT, INCLUDING MAJOR MEDICAL
EQUIPMENT;
  (B) CONSULTANT FEES;
  (C) RETIREMENT OF LONG TERM DEBT; OR
  (D) BANKRUPTCY-RELATED COSTS.
  (V) PAYMENTS MADE TO AWARDEES PURSUANT TO THIS  SUBDIVISION  SHALL  BE
MADE  ON A MONTHLY BASIS. SUCH PAYMENTS WILL BE BASED ON THE APPLICANT'S
ACTUAL MONTHLY FINANCIAL PERFORMANCE DURING SUCH PERIOD AND THE  REASON-
ABLE  CASH  AMOUNT  NECESSARY  TO  SUSTAIN  OPERATIONS FOR THE FOLLOWING
MONTH. THE APPLICANT'S MONTHLY FINANCIAL PERFORMANCE SHALL  BE  MEASURED
BY  SUCH APPLICANT'S MONTHLY FINANCIAL AND ACTIVITY REPORTS, WHICH SHALL
INCLUDE, BUT NOT BE LIMITED TO, ACTUAL  REVENUE  AND  EXPENSES  FOR  THE
PRIOR  MONTH,  PROJECTED  CASH NEED FOR THE CURRENT MONTH, AND PROJECTED
CASH NEED FOR THE FOLLOWING MONTH.
  (VI) THE DEPARTMENT SHALL PROVIDE A REPORT ON A QUARTERLY BASIS TO THE
CHAIRS OF THE SENATE FINANCE, ASSEMBLY WAYS AND MEANS, SENATE HEALTH AND
ASSEMBLY HEALTH COMMITTEES. SUCH REPORTS SHALL  BE  SUBMITTED  NO  LATER
THAN  SIXTY  DAYS  AFTER THE CLOSE OF THE QUARTER, AND SHALL INCLUDE FOR
EACH AWARD, THE NAME OF THE APPLICANT, THE AMOUNT OF THE AWARD, PAYMENTS

S. 4610--A                         137                        A. 6721--A

TO DATE, AND A DESCRIPTION OF THE STATUS OF THE  MULTI-YEAR  TRANSFORMA-
TION PLAN PURSUANT TO PARAGRAPH (III) OF THIS SUBDIVISION.
  S 7. 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 J of this act shall be
as specifically set forth in the last section of such Parts.