S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   4885
 
                        2019-2020 Regular Sessions
 
                             I N  S E N A T E
 
                              March 28, 2019
                                ___________
 
 Introduced  by  Sen.  PARKER -- read twice and ordered printed, and when
   printed to be committed to the Committee on Investigations and Govern-
   ment Operations
 
 AN ACT to amend the tax law and the education law, in relation to educa-
   tion tax surcharge
 
   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section  1.  Legislative  intent.  The  legislature  hereby  finds and
 declares that an omnibus education financing plan is essential to effec-
 tively and comprehensively provide a sound  basic  education  to  public
 school  students  in  the city of New York. The "emergency in education"
 surcharge tax, grounded in  the  need  to  provide  immediate,  adequate
 support  for  public  education in the city of New York, is such a plan.
 The plan recognizes and addresses several factors:  (1)  that  increased
 operating aid is necessary to ensure New York city students are prepared
 to  achieve the higher standards implemented by the New York state board
 of regents, (2) that the city of New York is  committed  to  shouldering
 its  "fair  share"  of  the  cost  of  educating  students in its public
 schools, and (3) that students currently attending public schools in the
 city of New York cannot afford to  wait  as  litigation  concerning  the
 state of New York's education financing system is decided by the courts.
 The  mayor  and  the city council have agreed that the financing program
 provided for in this act will provide the funds necessary  to  implement
 the  "emergency  in  education"  plan.  The state must authorize the new
 revenue sources requested by the city of New York to enable the city  to
 effectively educate public school students.
   §  2. The tax law is amended by adding a new section 1304-e to read as
 follows:
   § 1304-E. EMERGENCY IN EDUCATION TAX SURCHARGE. (A) IN ADDITION TO THE
 TAXES AUTHORIZED BY ANY OTHER SECTION OF THIS ARTICLE, ANY CITY IMPOSING
 SUCH TAXES IS HEREBY AUTHORIZED AND EMPOWERED TO ADOPT AND  AMEND  LOCAL
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
              

                                                            LBD10473-01-9

 S. 4885                             2
 
 LAWS  IMPOSING  IN ANY SUCH CITY TAX SURCHARGES ON (1) THE NEW YORK CITY
 ADJUSTED GROSS INCOME, AND  (2)  THE  TAX  DUE  UNDER  SECTION  THIRTEEN
 HUNDRED  FOUR  OF THIS ARTICLE OF EVERY CITY RESIDENT INDIVIDUAL, ESTATE
 AND  TRUST,  AS SET FORTH IN SUBSECTIONS (B), (C), (D), (E), (F) AND (G)
 OF THIS SECTION.
   (B) FOR TAXABLE YEARS BEGINNING IN  TWO  THOUSAND  NINETEEN,  THE  TAX
 SURCHARGES  IMPOSED  PURSUANT  TO THE AUTHORITY OF THIS SECTION SHALL BE
 DETERMINED AS FOLLOWS: (1) A TAX OF ONE PERCENT ON THE  PORTION  OF  THE
 NEW YORK CITY SOURCE ADJUSTED GROSS INCOME OF EVERY RESIDENT INDIVIDUAL,
 ESTATE  OR TRUST AND OF EVERY NONRESIDENT OR PART-YEAR RESIDENT INDIVID-
 UAL, ESTATE OR TRUST, ABOVE ONE HUNDRED THOUSAND DOLLARS, (2) A  TAX  OF
 ONE  PERCENT  ON  THE  PORTION OF SUCH INCOME ABOVE TWO HUNDRED THOUSAND
 DOLLARS, AND (3) A SURCHARGE OF  TWELVE  AND  ONE-HALF  PERCENT  ON  THE
 AMOUNT  OF  TAX DUE BY EVERY RESIDENT INDIVIDUAL, ESTATE OR TRUST AND OF
 EVERY NONRESIDENT OR PART-YEAR  RESIDENT  INDIVIDUAL,  ESTATE  OR  TRUST
 PURSUANT TO SECTION THIRTEEN HUNDRED FOUR OF THIS ARTICLE.
   (C)  FOR  TAXABLE  YEARS  BEGINNING  IN  TWO  THOUSAND TWENTY, THE TAX
 SURCHARGES IMPOSED PURSUANT TO THE AUTHORITY OF THIS  SECTION  SHALL  BE
 DETERMINED  AS  FOLLOWS:  (1) A TAX OF NINE-TENTHS OF ONE PERCENT ON THE
 PORTION OF THE NEW YORK CITY SOURCE ADJUSTED GROSS INCOME OF EVERY RESI-
 DENT INDIVIDUAL, ESTATE OR TRUST AND OF EVERY NONRESIDENT  OR  PART-YEAR
 RESIDENT  INDIVIDUAL,  ESTATE  OR  TRUST,  ABOVE  ONE  HUNDRED  THOUSAND
 DOLLARS, (2) A TAX OF NINE-TENTHS OF ONE PERCENT ON THE PORTION OF  SUCH
 INCOME ABOVE TWO HUNDRED THOUSAND DOLLARS, AND (3) A SURCHARGE OF ELEVEN
 AND ONE-QUARTER PERCENT ON THE AMOUNT OF TAX DUE BY EVERY RESIDENT INDI-
 VIDUAL,  ESTATE  OR TRUST AND OF EVERY NONRESIDENT OR PART-YEAR RESIDENT
 INDIVIDUAL, ESTATE OR TRUST PURSUANT TO SECTION THIRTEEN HUNDRED FOUR OF
 THIS ARTICLE.
   (D) FOR TAXABLE YEARS BEGINNING IN TWO THOUSAND  TWENTY-ONE,  THE  TAX
 SURCHARGES  IMPOSED  PURSUANT  TO THE AUTHORITY OF THIS SECTION SHALL BE
 DETERMINED AS FOLLOWS: (1) A TAX OF EIGHT-TENTHS OF ONE PERCENT  ON  THE
 PORTION OF THE NEW YORK CITY SOURCE ADJUSTED GROSS INCOME OF EVERY RESI-
 DENT  INDIVIDUAL,  ESTATE OR TRUST AND OF EVERY NONRESIDENT OR PART-YEAR
 RESIDENT  INDIVIDUAL,  ESTATE  OR  TRUST,  ABOVE  ONE  HUNDRED  THOUSAND
 DOLLARS, (2) A TAX OF EIGHT-TENTHS OF ONE PERCENT ON THE PORTION OF SUCH
 INCOME  ABOVE  TWO  HUNDRED THOUSAND DOLLARS, AND (3) A SURCHARGE OF TEN
 PERCENT ON THE AMOUNT OF TAX DUE BY EVERY RESIDENT INDIVIDUAL, ESTATE OR
 TRUST AND OF EVERY NONRESIDENT OR PART-YEAR RESIDENT INDIVIDUAL,  ESTATE
 OR TRUST PURSUANT TO SECTION THIRTEEN HUNDRED FOUR OF THIS ARTICLE.
   (E)  FOR  TAXABLE  YEARS BEGINNING IN TWO THOUSAND TWENTY-TWO, THE TAX
 SURCHARGES IMPOSED PURSUANT TO THE AUTHORITY OF THIS  SECTION  SHALL  BE
 DETERMINED  AS  FOLLOWS: (1) A TAX OF SEVEN-TENTHS OF ONE PERCENT ON THE
 PORTION OF THE NEW YORK CITY SOURCE ADJUSTED GROSS INCOME OF EVERY RESI-
 DENT INDIVIDUAL, ESTATE OR TRUST AND OF EVERY NONRESIDENT  OR  PART-YEAR
 RESIDENT  INDIVIDUAL,  ESTATE  OR  TRUST,  ABOVE  ONE  HUNDRED  THOUSAND
 DOLLARS, (2) A TAX OF SEVEN-TENTHS OF ONE PERCENT ON THE PORTION OF SUCH
 INCOME ABOVE TWO HUNDRED THOUSAND DOLLARS, AND (3) A SURCHARGE OF  EIGHT
 AND  THREE-QUARTERS  PERCENT  ON THE AMOUNT OF TAX DUE BY EVERY RESIDENT
 INDIVIDUAL, ESTATE OR TRUST AND OF EVERY NONRESIDENT OR PART-YEAR  RESI-
 DENT  INDIVIDUAL,  ESTATE  OR TRUST PURSUANT TO SECTION THIRTEEN HUNDRED
 FOUR OF THIS ARTICLE.
   (F) FOR TAXABLE YEARS BEGINNING IN TWO THOUSAND TWENTY-THREE, THE  TAX
 SURCHARGES  IMPOSED  PURSUANT  TO THE AUTHORITY OF THIS SECTION SHALL BE
 DETERMINED AS FOLLOWS: (1) A TAX OF SIX-TENTHS OF  ONE  PERCENT  ON  THE
 PORTION OF THE NEW YORK CITY SOURCE ADJUSTED GROSS INCOME OF EVERY RESI-
 DENT  INDIVIDUAL,  ESTATE OR TRUST AND OF EVERY NONRESIDENT OR PART-YEAR

 S. 4885                             3
 
 RESIDENT  INDIVIDUAL,  ESTATE  OR  TRUST,  ABOVE  ONE  HUNDRED  THOUSAND
 DOLLARS,  (2)  A TAX OF SIX-TENTHS OF ONE PERCENT ON THE PORTION OF SUCH
 INCOME ABOVE TWO HUNDRED THOUSAND DOLLARS, AND (3) A SURCHARGE OF  SEVEN
 AND ONE-HALF PERCENT ON THE AMOUNT OF TAX DUE BY EVERY RESIDENT INDIVID-
 UAL,  ESTATE  OR  TRUST  AND  OF EVERY NONRESIDENT OR PART-YEAR RESIDENT
 INDIVIDUAL, ESTATE OR TRUST PURSUANT TO SECTION THIRTEEN HUNDRED FOUR OF
 THIS ARTICLE.
   (G) FOR TAXABLE YEARS BEGINNING IN TWO THOUSAND TWENTY-FOUR AND THERE-
 AFTER, THE TAX SURCHARGES IMPOSED PURSUANT  TO  THE  AUTHORITY  OF  THIS
 SECTION  SHALL  BE  DETERMINED  AS FOLLOWS: (1) A TAX OF ONE-HALF OF ONE
 PERCENT ON THE PORTION OF THE NEW YORK CITY SOURCE ADJUSTED GROSS INCOME
 OF EVERY RESIDENT INDIVIDUAL, ESTATE OR TRUST AND OF  EVERY  NONRESIDENT
 OR  PART-YEAR  RESIDENT  INDIVIDUAL,  ESTATE OR TRUST, ABOVE ONE HUNDRED
 THOUSAND DOLLARS, (2) A TAX OF ONE-HALF OF ONE PERCENT ON THE PORTION OF
 SUCH INCOME ABOVE TWO HUNDRED THOUSAND DOLLARS, AND (3) A  SURCHARGE  OF
 SIX  AND  ONE-QUARTER PERCENT ON THE AMOUNT OF TAX DUE BY EVERY RESIDENT
 INDIVIDUAL, ESTATE OR TRUST AND OF EVERY NONRESIDENT OR PART-YEAR  RESI-
 DENT  INDIVIDUAL,  ESTATE  OR TRUST PURSUANT TO SECTION THIRTEEN HUNDRED
 FOUR OF THIS ARTICLE.
   (H) THE COMMISSIONER IN COOPERATION WITH THE COMPTROLLER  SHALL  MAIN-
 TAIN  SUCH  RECORDS  AS  ARE  NECESSARY TO DETERMINE WHAT PORTION OF THE
 INCOME TAX REVENUES COLLECTED ON BEHALF OF A CITY IMPOSING TAXES  PURSU-
 ANT  TO  THIS ARTICLE ARE ATTRIBUTABLE TO THE EMERGENCY IN EDUCATION TAX
 SURCHARGE ESTABLISHED BY THIS SECTION AND SHALL TRANSMIT SUCH  FUNDS  TO
 SUCH  CITY  IN  A MANNER THAT ALLOWS SUCH FUNDS TO BE CLEARLY SEGREGATED
 FROM ALL OTHER FUNDS AND ACCOUNTED FOR SEPARATELY. SUCH CITY SHALL MAIN-
 TAIN SUCH FUNDS IN A SEPARATE FUND TO BE CALLED THE EMERGENCY IN  EDUCA-
 TION  TAX SURCHARGE REVENUE ACCOUNT AND SHALL PUBLISH MONTHLY REPORTS ON
 SUCH FUND'S RECEIPTS, DISBURSEMENTS AND BALANCES IN A MANNER  THAT  WILL
 ALLOW  FOR A CLEAR UNDERSTANDING OF THE FINANCIAL CONDITION OF SUCH FUND
 AND OF THE USES THAT HAVE BEEN MADE OF THE FUND'S RESOURCES.   DISBURSE-
 MENTS FROM THIS FUND SHALL BE IN ADDITION TO THE FUNDS THAT SUCH CITY IS
 REQUIRED TO MAKE FOR EDUCATIONAL PURPOSES PURSUANT TO SUBDIVISION FIVE-C
 OF  SECTION  TWENTY-FIVE HUNDRED SEVENTY-SIX OF THE EDUCATION LAW AND NO
 DISBURSEMENTS FROM THIS FUND OR OTHER FINANCIAL  TRANSACTIONS  INVOLVING
 THIS  FUND SHALL BE TAKEN INTO CONSIDERATION IN ANY MANNER WHATSOEVER IN
 DETERMINING SUCH CITY'S COMPLIANCE WITH THE REQUIREMENTS OF SUCH  SUBDI-
 VISION  FIVE-C  OF SECTION TWENTY-FIVE HUNDRED SEVENTY-SIX OF THE EDUCA-
 TION LAW.
   (I) ANY MONIES GENERATED BY THIS SECTION  SHALL  BE  USED  FOR  PUBLIC
 EDUCATION PURPOSES ONLY, INCLUDING HIRING AND RETAINING TEACHERS, TEACH-
 ER  TRAINING, DECREASING CLASS SIZES, AND EQUIPPING AND BUILDING FACILI-
 TIES.
   § 3. The education law is amended by adding a new section 2589 to read
 as follows:
   § 2589. EMERGENCY IN EDUCATION OPERATING AID. 1. IN  ADDITION  TO  THE
 GENERAL  OPERATING  AID AUTHORIZED BY ANY OTHER SECTION OF LAW, ANY CITY
 IMPOSING AN EMERGENCY IN EDUCATION TAX  SURCHARGE  PURSUANT  TO  SECTION
 THIRTEEN  HUNDRED  FOUR-E OF THE TAX LAW SHALL RECEIVE ADDITIONAL APPOR-
 TIONMENTS OF PUBLIC MONEY FOR GENERAL  OPERATING  AID  PURPOSES,  TO  BE
 KNOWN AS EMERGENCY IN EDUCATION OPERATING AID, FOR SCHOOL YEARS COMMENC-
 ING  ON AND AFTER JULY FIRST, TWO THOUSAND TWENTY AS SET FORTH IN SUBDI-
 VISIONS TWO, THREE, FOUR, FIVE, SIX AND  SEVEN  OF  THIS  SECTION.  SUCH
 APPORTIONMENTS SHALL BE IN ADDITION TO AND NOT IN LIEU OF THE APPORTION-
 MENTS  OF  PUBLIC  MONEY TO SUCH CITY FOR GENERAL OPERATING AID PURPOSES
 MADE AVAILABLE TO SUCH CITY  PURSUANT  TO  OTHER  SECTIONS  OF  LAW  AND

 S. 4885                             4
 
 PROVIDED  THAT  THE AMOUNTS MADE AVAILABLE TO SUCH CITY PURSUANT TO SUCH
 OTHER PROVISIONS OF LAW SHALL NOT IN ANY SCHOOL YEAR  COMMENCING  ON  OR
 AFTER  JULY  FIRST,  TWO  THOUSAND  TWENTY  BE LESS THAN THE AMOUNT MADE
 AVAILABLE  TO SUCH CITY FOR SUCH PURPOSES, WITH THE CATEGORIES OF AID TO
 BE COVERED BY THIS REQUIREMENT TO BE  DETERMINED  BY  THE  COMMISSIONER,
 DURING  THE  SCHOOL YEAR COMMENCING ON JULY FIRST, TWO THOUSAND NINETEEN
 TIMES A NUMBER DETERMINED BY DIVIDING THE CONSUMER PRICE INDEX  FOR  ALL
 URBAN  CONSUMERS FOR THE CALENDAR YEAR PRECEDING THE COMMENCEMENT OF THE
 SCHOOL YEAR FOR WHICH  SUCH  APPORTIONMENT  IS  BEING  PROVIDED  BY  THE
 CONSUMER  PRICE  INDEX  FOR  ALL  URBAN  CONSUMERS  FOR THE TWO THOUSAND
 SIXTEEN CALENDAR YEAR.
   2. FOR THE SCHOOL YEAR COMMENCING ON JULY FIRST, TWO THOUSAND  TWENTY,
 SUCH  EMERGENCY  IN  EDUCATION OPERATING AID SHALL BE AN AMOUNT EQUAL TO
 TWENTY PERCENT OF THE AMOUNT TRANSMITTED TO  SUCH  A  CITY  PURSUANT  TO
 SUBSECTION  (H) OF SECTION THIRTEEN HUNDRED FOUR-E OF THE TAX LAW DURING
 THE TWO THOUSAND SIXTEEN CALENDAR YEAR.
   3. FOR THE SCHOOL YEAR COMMENCING ON JULY FIRST, TWO THOUSAND  TWENTY-
 ONE,  SUCH EMERGENCY IN EDUCATION OPERATING AID SHALL BE AN AMOUNT EQUAL
 TO TWENTY PERCENT OF THE AMOUNT TRANSMITTED TO SUCH A CITY  PURSUANT  TO
 SUBSECTION  (H) OF SECTION THIRTEEN HUNDRED FOUR-E OF THE TAX LAW DURING
 THE TWO THOUSAND SEVENTEEN CALENDAR YEAR.
   4.  FOR THE SCHOOL YEAR COMMENCING ON JULY FIRST, TWO  THOUSAND  TWEN-
 TY-TWO,  SUCH  EMERGENCY  IN  EDUCATION OPERATING AID SHALL BE AN AMOUNT
 EQUAL TO FORTY PERCENT OF THE AMOUNT TRANSMITTED TO SUCH A CITY PURSUANT
 TO SUBSECTION (H) OF SECTION THIRTEEN HUNDRED  FOUR-E  OF  THE  TAX  LAW
 DURING THE TWO THOUSAND EIGHTEEN CALENDAR YEAR.
   5.  FOR THE SCHOOL YEAR COMMENCING ON JULY FIRST, TWO THOUSAND TWENTY-
 THREE, SUCH EMERGENCY IN EDUCATION OPERATING  AID  SHALL  BE  AN  AMOUNT
 EQUAL TO SIXTY PERCENT OF THE AMOUNT TRANSMITTED TO SUCH A CITY PURSUANT
 TO  SUBSECTION  (H)  OF  SECTION  THIRTEEN HUNDRED FOUR-E OF THE TAX LAW
 DURING THE TWO THOUSAND NINETEEN CALENDAR YEAR.
   6. FOR THE SCHOOL YEAR COMMENCING ON JULY FIRST, TWO THOUSAND  TWENTY-
 FOUR, SUCH EMERGENCY IN EDUCATION OPERATING AID SHALL BE AN AMOUNT EQUAL
 TO  EIGHTY  PERCENT OF THE AMOUNT TRANSMITTED TO SUCH A CITY PURSUANT TO
 SUBSECTION (H) OF SECTION THIRTEEN HUNDRED FOUR-E OF THE TAX LAW  DURING
 THE TWO THOUSAND TWENTY CALENDAR YEAR.
   7.  FOR  THE SCHOOL YEAR COMMENCING ON AND AFTER JULY FIRST, TWO THOU-
 SAND TWENTY-FIVE, SUCH EMERGENCY IN EDUCATION OPERATING AID SHALL BE  AN
 AMOUNT  EQUAL  TO  THE  AMOUNT  TRANSMITTED  TO  SUCH A CITY PURSUANT TO
 SUBSECTION (H) OF SECTION THIRTEEN HUNDRED FOUR-E OF THE TAX LAW  DURING
 THE PRECEDING CALENDAR YEAR.
   8.  THE  MONEYS  GENERATED  BY  THIS  SECTION SHALL BE USED FOR PUBLIC
 EDUCATION PURPOSES ONLY, INCLUDING HIRING AND RETAINING TEACHERS, TEACH-
 ER TRAINING, DECREASING CLASS SIZES AND EQUIPPING  AND  BUILDING  CLASS-
 ROOMS.
   §  4.  Section  2576  of  the education law is amended by adding a new
 subdivision 5-c to read as follows:
   5-C. A. IF THE TOTAL AMOUNT REQUESTED IN SUCH ESTIMATE IS  NOT  APPRO-
 PRIATED,  EACH  CITY HAVING A POPULATION OF ONE MILLION OR MORE INHABIT-
 ANTS SHALL APPROPRIATE AN AMOUNT NOT LESS THAN THE GREATER OF:
   (I) THE PRODUCT OF THE CITY SHARE IN  THE  BASE  YEAR  AND  THE  PUPIL
 CHANGE  INDEX, AS SUCH TERMS ARE DEFINED IN PARAGRAPH C OF THIS SUBDIVI-
 SION, OR
   (II) AN AMOUNT EQUAL TO THE AVERAGE PROPORTION OF  THE  TOTAL  EXPENSE
 BUDGET  OF  SUCH  CITY,  AS  AMENDED,  NOT INCLUDING THE PORTION OF SUCH
 EXPENSE BUDGET EQUAL TO THE TOTAL STATE AND FEDERAL AID APPROPRIATED FOR

 S. 4885                             5
 
 EDUCATION PURPOSES, APPROPRIATED FOR THE PURPOSES OF  SUCH  CITY  SCHOOL
 DISTRICT  IN  THE  THREE FISCAL YEARS OF SUCH CITY IMMEDIATELY PRECEDING
 THE YEAR FOR WHICH SAID ESTIMATE IS FILED.
   B.  IF  THE TOTAL AMOUNT REQUESTED IN THE ESTIMATE EXCEEDS THE GREATER
 OF THE TWO AMOUNTS COMPUTED IN PARAGRAPH A  OF  THIS  SUBDIVISION,  SUCH
 EXCESS  SHALL  BE  SUBJECT  TO SUCH CONSIDERATION AND SUCH ACTION BY THE
 APPROPRIATE CITY LEGISLATIVE BODY AND/OR CITY OFFICER AS THAT TAKEN UPON
 OTHER DEPARTMENTAL ESTIMATES.  THE CITY IS AUTHORIZED TO MAKE ADDITIONAL
 APPROPRIATIONS FOR EDUCATIONAL PURPOSES AUTHORIZED BY THIS CHAPTER.
   C. FOR THE PURPOSES OF THIS SUBDIVISION, THE TERMS:
   (I) "CITY SHARE" SHALL MEAN:  THE  TOTAL  APPROPRIATION  OF  ANY  CITY
 HAVING  A  POPULATION  OF ONE MILLION OR MORE INHABITANTS FOR ELEMENTARY
 AND SECONDARY EDUCATION PURPOSES AS DEFINED BY  THE  COMMISSIONER  MINUS
 THE  TOTAL  AMOUNT  OF FEDERAL AND STATE AID APPROPRIATED FOR ELEMENTARY
 AND SECONDARY EDUCATION PURPOSES;
   (II) "BASE YEAR" SHALL MEAN: THE FISCAL YEAR IMMEDIATELY PRECEDING THE
 FISCAL YEAR FOR WHICH THE ESTIMATE IS FILED;
   (III) "PUPIL CHANGE INDEX" SHALL MEAN: THE RATIO COMPUTED BY  DIVIDING
 THE  TOTAL PUBLIC SCHOOL ENROLLMENT OF THE CITY SCHOOL DISTRICT, INCLUD-
 ING ALL STUDENTS WHOLLY OR PARTIALLY SUPPORTED BY SUCH CITY'S FUNDS,  IN
 THE  YEAR  IN WHICH THE ESTIMATE IS FILED BY THE ENROLLMENT OF SUCH CITY
 SCHOOL DISTRICT IN THE YEAR IMMEDIATELY PRECEDING THE YEAR IN WHICH  THE
 ESTIMATE IS FILED.
   § 5. This act shall take effect immediately.