NY State Senate Bill 2017-S7615

Senate Bill S7615

2017-2018 Legislative Session

Grants eligibility for the tax abatement for industrial and commercial construction work in cities having a population of one million or more, to certain electric generating facilities

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Archive: Last Bill Status - In Senate Committee Rules Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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Actions

View Actions

	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jun 20, 2018	committed to rules
Jun 05, 2018	advanced to third reading
Jun 04, 2018	2nd report cal.
May 31, 2018	1st report cal.1439
Jan 31, 2018	referred to cities

Votes

- May 31, 2018 - Committee Vote
  S7615
  
  5
  
  Aye
  
  0
  
  Nay
  
  2
  
  Aye with Reservations
  
  0
  
  Absent
  
  0
  
  Excused
  
  0
  
  Abstained
  - - Committee Vote: May 31, 2018
      
      aye (5)
      
      Akshar
      
      Avella
      
      Felder
      
      Funke
      
      Persaud
      
      aye wr (2)
      
      Jacobs
      
      Peralta

co-Sponsors

2017-S7615 (ACTIVE) - Details

See Assembly Version of this Bill:: A9827
Current Committee:: Senate Rules
Law Section:: Real Property Tax Law
Laws Affected:: Amd §489-aaaaaa, RPT L; amd §11-268, NYC Ad Cd
Versions Introduced in Other Legislative Sessions:: 2019-2020: S2389, S7849, A4872
2021-2022: A3875

2017-S7615 (ACTIVE) - Summary

Grants eligibility for the tax abatement for industrial and commercial construction work in cities having a population of one million or more, to certain electric generating facilities the operation of which commenced in 2012.

2017-S7615 (ACTIVE) - Sponsor Memo

                                
 
BILL NUMBER: S7615

SPONSOR: LANZA
 
TITLE OF BILL:

An act to amend the real property tax law and the administrative code of
the city of New York, in relation to applications by certain electric
generating facilities for tax abatements for industrial and commercial
construction work on properties in a city of one million or more persons

 
PURPOSE:

This bill would amend the Real Property Tax Law and the Administrative
Code of the City of New York to reauthorize the Industrial and Commer-
cial Abatement Program (ICAP) to correct a defect in the 2011 amendment
that provides as-a-right ICAP benefits to electric peaking generating
facilities.

 
SUMMARY OF PROVISIONS:

Section 1 of the bill sets forth the bill's legislative findings.

Section 2

 
EXISTING LAW:

Currently, there is a tax abatement program, the Industrial and Commer-
cial Abatement Program (ICAP), for eligible industrial or commercial
work on properties in New York City established pursuant to Chapter 119
of the Laws of 2008. In 2011, ICAP was amended to enable the owners of
peaking units to be eligible to receive ICAP abatements from New York
City as a right.

 
JUSTIFICATION:

Chapter 28 of 2011, a Governor's program bill was adopted to ensure that
New York City ratepayers didn't face a large unwarranted rate increase
that would have occurred if not for the adoption of the law.  The legis-
lation and it's supporting documents clearly stated to the Federal Ener-
gy Regulatory Commission that any new peaking facility that comes online
after the effective date of Chapter 28 is eligible for benefits of the
Industrial and Commercial Abatement Program (ICAP) as a right. The chap-
ter and subsequent action by the FERC prevented property taxes from
being included in the rate curve and since it's adoption has saved New
York City Ratepayers hundreds of millions of dollars on their electric
bills. A peaking facility was under construction and nearly complete
when Chapter 28 was adopted and came online later in 2012. It is the
only "in city" generating facility that hasn't received ICAP or its
predecessor ICIP benefits.  The adoption of this amendment will fix an
unintended defect in the statute and provide the peaking facility with
the tax relief that the State and City promised in 2012.

The sponsor's memo to chapter 28 of 2011 states:

"This bill would remove the uncertainty with respect to property tax
assessments on peaking units by returning to an as of right property tax
abatement program leaving the City of New York with no discretion in
awarding the abatement if the peaking unit satisfies the objective
eligibility criteria established in the legislation."  The adoption of
this amendment will make this statement true of the first and only new
peaking unit to serve Zone J since the adoption of the 2011 law. No
other legislation is required in the future as any new plant would be
eligible for ICAP benefits.

 
LEGISLATIVE HISTORY:

This is a new bill.

 
FISCAL IMPLICATIONS:

This bill would have no fiscal impact on the State.

 
EFFECTIVE DATE:
This bill would take effect immediately.

2017-S7615 (ACTIVE) - Bill Text download pdf

                            
 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   7615
 
                             I N  S E N A T E
 
                             January 31, 2018
                                ___________
 
 Introduced  by  Sen.  LANZA  -- read twice and ordered printed, and when
   printed to be committed to the Committee on Cities
 
 AN ACT to amend the real property tax law and the administrative code of
   the city of New York, in relation to applications by certain  electric
   generating facilities for tax abatements for industrial and commercial
   construction  work  on  properties  in  a  city of one million or more
   persons
 
   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. Legislative findings. The legislature hereby finds that the
 2011  amendment  to  the industrial and commercial abatement program was
 succesful in preventing a large increase in capacity rates for electric-
 ity that would have cost ratepayers in the city of New York hundreds  of
 millions  of dollars had the law not been changed. However, in the haste
 to adopt that law, a new peaking power plant fell through the cracks and
 has been paying property taxes since it began operations in  2012,  even
 though  the 2011 statute clearly intended that industrial and commercial
 abatement program benefits be provided to  peaking  power  plants  as  a
 right.  This act would correct that defect in the statute and enable the
 facility to receive industrial and commercial abatement program benefits
 prospectively.
   § 2. Subdivision 17 of section 489-aaaaaa of  the  real  property  tax
 law, as amended by chapter 28 of the laws of 2011, is amended to read as
 follows:
   17.  "Utility  property"  means property and equipment as described in
 paragraphs (c), (d), (e), (f) and (i) of subdivision twelve  of  section
 one  hundred  two of this chapter that is used in the ordinary course of
 business by its owner or any other entity or property  as  described  in
 paragraphs  (a) and (b) of subdivision twelve of section one hundred two
 of this chapter that is owned by any entity that uses  in  the  ordinary
 course  of  business  property  and equipment as described in paragraphs
 (c), (d), (e), (f) and (i) of subdivision twelve of section one  hundred
 two  of this chapter, without regard to the classification of such prop-
 erty and equipment for real property tax purposes  pursuant  to  section
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets

                       [ ] is old law to be omitted.
                                                            LBD14515-01-8

 S. 7615                             2
 
 eighteen  hundred two of this chapter, except that any such property and
 equipment used solely to serve the building to which they  are  attached
 shall  not  be deemed utility property. Notwithstanding any provision of
 this title to the contrary, peaking units shall not be considered utili-
 ty  property.  For  purposes  of this title, "peaking unit" shall mean a
 generating unit that: (a) is determined  by  the  New  York  independent
 system operator or a federal or New York state energy regulatory commis-
 sion  to  constitute  a peaking unit as set forth in section 5.14.1.2 of
 the New York independent system  operator's  market  administration  and
 control  area  services  tariff, as such term existed as of April first,
 two thousand eleven; or (b) has an annual average operation, during  the
 calendar  year  preceding the taxable status date, of less than eighteen
 hours following each start of the unit; for purposes of calculating  the
 annual  average, operations during any period covered by any major emer-
 gency declaration issued by the New York  independent  system  operator,
 northeast  power  coordinating council, or other similar entity shall be
 excluded; OR (C) NOTWITHSTANDING THE REQUIREMENTS AND PROVISIONS OF THIS
 TITLE,  ANY  PEAKING  UNIT  THAT  WAS  PLANNED,   APPROVED   AND   UNDER
 CONSTRUCTION  BETWEEN THE EFFECTIVE DATE OF THIS TITLE AND THE EFFECTIVE
 DATE OF CHAPTER TWENTY-EIGHT OF THE LAWS OF  TWO  THOUSAND  ELEVEN,  AND
 UPON  GOING  INTO  SERVICE  EXCLUSIVELY  PROVIDES ELECTRICITY TO ZONE J,
 SHALL BE DEEMED ELIGIBLE FOR  THE  BENEFITS  OF  THIS  TITLE;  PROVIDED,
 HOWEVER,  THAT  THE  BENEFIT  PERIOD  FOR A PEAKING UNIT SHALL BE AS SET
 FORTH IN PARAGRAPH (B-1) OF SUBDIVISION THREE OF  SECTION  FOUR  HUNDRED
 EIGHTY-NINE-BBBBBB OF THIS TITLE; AND PROVIDED, FURTHER, THAT SUCH BENE-
 FITS  SHALL COMMENCE UPON THE EFFECTIVE DATE OF THIS PARAGRAPH. A "peak-
 ing unit" under this title shall  include  all  real  property  used  in
 connection  with  the generation of electricity, and any facilities used
 to interconnect the peaking  unit  with  the  electric  transmission  or
 distribution  system, but shall not include any facilities that are part
 of the electric transmission or distribution system; it may be comprised
 of a single turbine and generator or multiple  turbines  and  generators
 located at the same site. Notwithstanding any provision of this title to
 the  contrary,  a  peaking unit shall be considered industrial property,
 provided however that the benefit period for a peaking unit shall be  as
 set  forth  in  paragraph  (b-1)  of  subdivision  three of section four
 hundred eighty-nine-bbbbbb of this title.
   § 3. Subdivision q of section 11-268 of the adminsitrative code of the
 city of New York, as amended by chapter 28  of  the  laws  of  2011,  is
 amended to read as follows:
   q.  "Utility  property"  means  property and equipment as described in
 paragraphs (c), (d), (e), (f) and (i) of subdivision twelve  of  section
 one  hundred  two of the real property tax law that is used in the ordi-
 nary course of business by its owner or any other entity or property  as
 described in paragraphs (a) and (b) of subdivision twelve of section one
 hundred  two  of  such  law that is owned by any entity that uses in the
 ordinary course of business property and equipment as described in para-
 graphs (c), (d), (e), (f) and (i) of subdivision twelve of  section  one
 hundred  two  of  such law, without regard to the classification of such
 property and equipment  for  real  property  tax  purposes  pursuant  to
 section  eighteen hundred two of such law, except that any such property
 and equipment used solely to  serve  the  building  to  which  they  are
 attached  shall  not  be  deemed  utility  property. Notwithstanding any
 provision of this part to the  contrary,  peaking  units  shall  not  be
 considered  utility  property. For purposes of this part, "peaking unit"
 shall mean a generating unit that: (a) is determined  by  the  New  York

 S. 7615                             3
 
 independent  system operator or a federal or New York state energy regu-
 latory commission to constitute a peaking unit as set forth  in  section
 5.14.1.2  of  the New York independent system operator's market adminis-
 tration  and  control  area  services tariff, as such term existed as of
 April first, two thousand eleven; or (b) has an  annual  average  opera-
 tion,  during  the  calendar  year preceding the taxable status date, of
 less than eighteen hours following each start of the unit; for  purposes
 of  calculating the annual average, operations during any period covered
 by any major emergency declaration issued by the  New  York  independent
 system  operator, northeast power coordinating council, or other similar
 entity shall be excluded; OR (C) NOTWITHSTANDING  THE  REQUIREMENTS  AND
 PROVISIONS OF THIS PART, ANY PEAKING UNIT THAT WAS PLANNED, APPROVED AND
 UNDER  CONSTRUCTION BETWEEN THE EFFECTIVE DATE OF TITLE TWO-F OF ARTICLE
 FOUR OF THE REAL PROPERTY TAX LAW AND  THE  EFFECTIVE  DATE  OF  CHAPTER
 TWENTY-EIGHT  OF  THE  LAWS  OF TWO THOUSAND ELEVEN, AND UPON GOING INTO
 SERVICE EXCLUSIVELY PROVIDES ELECTRICITY TO  ZONE  J,  SHALL  BE  DEEMED
 ELIGIBLE  FOR  THE  BENEFITS  OF  THIS PART; PROVIDED, HOWEVER, THAT THE
 BENEFIT PERIOD FOR A PEAKING UNIT SHALL BE AS SET FORTH IN  SUBPARAGRAPH
 (A)  OF  PARAGRAPH  TWO OF SUBDIVISION C OF SECTION 11-269 OF THIS PART;
 AND PROVIDED, FURTHER, THAT SUCH BENEFITS SHALL COMMENCE UPON THE EFFEC-
 TIVE DATE OF THIS PARAGRAPH. A "peaking  unit"  under  this  part  shall
 include  all  real  property  used  in connection with the generation of
 electricity, and any facilities used to interconnect  the  peaking  unit
 with  the  electric  transmission  or distribution system, but shall not
 include any facilities that are part of  the  electric  transmission  or
 distribution system; it may be comprised of a single turbine and genera-
 tor  or  multiple  turbines  and  generators  located  at the same site.
 Notwithstanding any provision of this part to the  contrary,  a  peaking
 unit  shall be considered industrial property, provided however that the
 benefit period for a peaking unit shall be as  set  forth  in  paragraph
 two-a of subdivision c of section 11-269 of this part.
   § 4. This act shall take effect immediately.

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Senate Bill S7615

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Sponsored By

Andrew J. Lanza