S T A T E O F N E W Y O R K
________________________________________________________________________
8506
2019-2020 Regular Sessions
I N A S S E M B L Y
August 7, 2019
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Introduced by M. of A. CARROLL -- read once and referred to the Commit-
tee on Governmental Operations
AN ACT to amend the state finance law and the tax law, in relation to
requiring direct air capture products in cement and concrete used in
state projects; creates a tax credit for using direct air capture
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. Section 165 of the state finance law is amended by adding a
new subdivision 9 to read as follows:
9. SPECIAL PROVISIONS FOR PURCHASE OF CEMENT AND CONCRETE. A. FOR THE
PURPOSES OF THIS SECTION, "DIRECT AIR CAPTURE" SHALL MEAN A CAPTURE
METHOD OF CARBON CAPTURE AND STORAGE THAT SEPARATES CARBON DIOXIDE FROM
AIR.
B. WHEN LETTING CONTRACTS FOR THE PURCHASE OF CEMENT OR CONCRETE ON
BEHALF OF FACILITIES AND INSTITUTIONS OF THE STATE, SOLICITATION SPEC-
IFICATIONS OF THE OFFICE OF GENERAL SERVICES AND ANY OTHER AGENCY,
DEPARTMENT, OFFICE, BOARD OR COMMISSION SHALL REQUIRE PROVISIONS THAT
MANDATE THAT ALL CEMENT AND CONCRETE USED CONTAINS, BY WEIGHT OF DRY
INGREDIENTS:
(I) AT LEAST TWO PERCENT THE PRODUCT OF DIRECT AIR CAPTURE BETWEEN
JANUARY FIRST, TWO THOUSAND TWENTY-TWO AND DECEMBER THIRTY-FIRST, TWO
THOUSAND TWENTY-TWO;
(II) AT LEAST THREE PERCENT THE PRODUCT OF DIRECT AIR CAPTURE BETWEEN
JANUARY FIRST, TWO THOUSAND TWENTY-THREE AND DECEMBER THIRTY-FIRST, TWO
THOUSAND TWENTY-THREE;
(III) AT LEAST FOUR PERCENT THE PRODUCT OF DIRECT AIR CAPTURE BETWEEN
JANUARY FIRST, TWO THOUSAND TWENTY-FOUR AND DECEMBER THIRTY-FIRST, TWO
THOUSAND TWENTY-FOUR; AND
(IV) AT LEAST FIVE PERCENT THE PRODUCT OF DIRECT AIR CAPTURE ON AND
AFTER JANUARY FIRST, TWO THOUSAND TWENTY-FIVE.
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD11018-01-9
A. 8506 2
C. THE COMMISSIONER SHALL ISSUE REGULATIONS FOR THE IMPLEMENTATION OF
THIS SUBDIVISION, INCLUDING BUT NOT LIMITED TO:
(I) ESTABLISHING GUIDELINES THAT WILL ASSIST AGENCIES IN DETERMINING
WHICH CONTRACTS MEET THE REQUIREMENTS IN PARAGRAPH B OF THIS SUBDIVI-
SION;
(II) PUBLISHING SUCH PURCHASING GUIDELINES ON THE OFFICE OF GENERAL
SERVICES' WEBSITE, DISSEMINATING SUCH GUIDELINES TO AGENCIES AND TRAIN-
ING CONTRACTING PERSONNEL ON IMPLEMENTING SUCH GUIDELINES; AND
(III) PROVIDING FOR MONITORING OF IMPLEMENTATION.
D. (I) WITH EACH OFFER, THE OFFERER SHALL CERTIFY THAT THE CEMENT
AND/OR CONCRETE PROVIDED PURSUANT TO THAT SOLICITATION WILL BE IN
CONFORMITY WITH THE PROVISIONS OF THE PERCENTAGE REQUIRED TO MEET OR
EXCEED THE REQUIREMENTS IN THE SOLICITATION SPECIFYING THE AMOUNT BY
WEIGHT OF DRY INGREDIENTS IS FROM DIRECT CARBON CAPTURE.
(II) ANY SUCCESSFUL OFFERER WHO FAILS TO COMPLY WITH THE PROVISIONS OF
THIS SUBDIVISION, AT THE DISCRETION OF SUCH AGENCY, BOARD, OFFICE OR
COMMISSION, SHALL FORFEIT THE RIGHT TO BID ON CONTRACTS LET UNDER THE
PROVISIONS OF THIS SUBDIVISION FOR A PERIOD OF TIME TO BE DETERMINED BY
THE COMMISSIONER.
E. NO LATER THAN DECEMBER FIRST OF EACH YEAR THE COMMISSIONER SHALL
ANNUALLY REPORT TO THE GOVERNOR AND LEGISLATURE ON THE IMPLEMENTATION OF
THIS SUBDIVISION. SUCH REPORT SHALL INCLUDE, AT MINIMUM:
(I) A DESCRIPTION OF THE OFFICE'S EFFORTS TO IMPROVE AND INCREASE THE
TRACKING OF INFORMATION RELATING TO PRODUCTS OF DIRECT AIR CAPTURE; AND
(II) THE TOTAL AMOUNT OF CARBON DIOXIDE REMOVED FROM THE AIR AS A
RESULT OF THIS SUBDIVISION.
F. THE COMMISSIONER SHALL ADVISE AND ASSIST THE CHANCELLOR OF THE
STATE UNIVERSITY OF NEW YORK IN EXTENDING THE BENEFITS OF THE PROVISIONS
OF THIS SUBDIVISION TO THE UNIVERSITY AND SHALL MODIFY ANY REGULATIONS
OR PROCEDURES HERETOFORE ESTABLISHED PURSUANT TO THIS SUBDIVISION, IN
ORDER TO FACILITATE SUCH PARTICIPATION.
§ 2. Section 210-B of the tax law is amended by adding a new subdivi-
sion 53 to read as follows:
53. DIRECT AIR CAPTURE TAX CREDIT. (A) ALLOWANCE OF CREDIT. A TAXPAYER
SHALL BE ALLOWED A CREDIT, TO BE COMPUTED AS PROVIDED IN THIS SUBDIVI-
SION, AGAINST THE TAX IMPOSED BY THIS ARTICLE, IF IT PRODUCES CEMENT,
CONCRETE, OR BOTH WITH DIRECT AIR CAPTURE PRODUCT.
(B) AMOUNT OF CREDIT. A CREDIT AUTHORIZED BY THIS SUBDIVISION SHALL
EQUAL THE SUM OF THE CAPITAL COSTS TO BEGIN PRODUCTION OF AND THE
INCREASE IN PRODUCTION COSTS OF CEMENT, CONCRETE, OR BOTH WITH DIRECT
AIR CAPTURE PRODUCT. THE INCREASE IN PRODUCTION COSTS SHALL BE CALCU-
LATED AS THE DIFFERENCE BETWEEN THE OPERATING COSTS OF SUCH PRODUCTION
BEFORE THE IMPLEMENTATION OF DIRECT AIR CAPTURE AND THE OPERATING COSTS
OF SUCH PRODUCTION AFTER THE IMPLEMENTATION OF DIRECT AIR CAPTURE.
(C) APPLICATION OF CREDIT. THE CREDIT ALLOWED UNDER THIS SUBDIVISION
FOR ANY TAXABLE YEAR SHALL NOT REDUCE THE TAX DUE FOR SUCH YEAR TO LESS
THAN THE FIXED DOLLAR MINIMUM AMOUNT PRESCRIBED IN PARAGRAPH (D) OF
SUBDIVISION ONE OF SECTION TWO HUNDRED TEN OF THIS ARTICLE. HOWEVER, IF
THE AMOUNT OF CREDIT ALLOWED UNDER THIS SUBDIVISION FOR ANY TAXABLE YEAR
REDUCES THE TAX TO SUCH AMOUNT OR IF THE TAXPAYER OTHERWISE PAYS TAX
BASED ON THE FIXED DOLLAR MINIMUM AMOUNT, ANY AMOUNT OF CREDIT THUS 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 ONE THOUSAND EIGHTY-SIX OF THIS CHAPTER. PROVIDED, HOWEVER, THE
PROVISIONS OF SUBSECTION (C) OF SECTION ONE THOUSAND EIGHTY-EIGHT OF
THIS CHAPTER NOTWITHSTANDING, NO INTEREST SHALL BE PAID THEREON.
A. 8506 3
(D) DEFINITION. FOR THE PURPOSES OF THIS SECTION, "DIRECT AIR CAPTURE"
SHALL MEAN A CAPTURE METHOD OF CARBON CAPTURE AND STORAGE THAT SEPARATES
CARBON DIOXIDE FROM AIR.
§ 3. Section 606 of the tax law is amended by adding a new subsection
(jjj) to read as follows:
(JJJ) DIRECT AIR CAPTURE TAX CREDIT. (1) ALLOWANCE OF CREDIT. A
TAXPAYER SHALL BE ALLOWED A CREDIT, TO BE COMPUTED AS PROVIDED IN THIS
SUBSECTION, AGAINST THE TAX IMPOSED BY THIS ARTICLE, IF IT PRODUCES
CEMENT, CONCRETE, OR BOTH WITH DIRECT AIR CAPTURE PRODUCT.
(2) AMOUNT OF CREDIT. A CREDIT AUTHORIZED BY THIS SUBSECTION SHALL
EQUAL THE SUM OF THE CAPITAL COSTS TO BEGIN PRODUCTION OF AND THE
INCREASE IN PRODUCTION COSTS OF CEMENT, CONCRETE, OR BOTH WITH DIRECT
AIR CAPTURE PRODUCT. THE INCREASE IN PRODUCTION COSTS SHALL BE CALCU-
LATED AS THE DIFFERENCE BETWEEN THE OPERATING COSTS OF SUCH PRODUCTION
BEFORE THE IMPLEMENTATION OF DIRECT AIR CAPTURE AND THE OPERATING COSTS
OF SUCH PRODUCTION AFTER THE IMPLEMENTATION OF DIRECT AIR CAPTURE.
(3) APPLICATION OF CREDIT. IF THE AMOUNT OF THE CREDIT ALLOWABLE UNDER
THIS SUBSECTION FOR ANY TAXABLE YEAR EXCEEDS THE TAXPAYER'S TAX FOR SUCH
YEAR, THE EXCESS SHALL BE TREATED AS AN OVERPAYMENT OF TAX TO BE CREDIT-
ED OR REFUNDED AS PROVIDED IN SECTION SIX HUNDRED EIGHTY-SIX OF THIS
ARTICLE, PROVIDED, HOWEVER, THAT NO INTEREST SHALL BE PAID THEREON.
§ 4. Subparagraph (B) of paragraph 1 of subsection (i) of section 606
of the tax law is amended by adding a new clause (xliv) to read as
follows:
(XLIV) DIRECT AIR CAPTURE AMOUNT OF CREDIT UNDER
CREDIT UNDER SUBDIVISION FIFTY-THREE OF
SUBSECTION (JJJ) SECTION TWO HUNDRED TEN-B
§ 5. This act shall take effect immediately and sections two, three,
and four of this act shall apply to taxable years commencing on and
after such date.