S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   4918
 
                        2019-2020 Regular Sessions
 
                             I N  S E N A T E
 
                              March 29, 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, in relation to the creation of  the  empire
   state music production credit
 
   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. The tax law is amended by adding a new section 44  to  read
 as follows:
   §  44. EMPIRE STATE MUSIC PRODUCTION CREDIT. (A)(1) ALLOWANCE OF CRED-
 IT. A TAXPAYER WHICH IS A QUALIFIED MUSIC PRODUCTION COMPANY, OR A QUAL-
 IFIED INDEPENDENT MUSIC PRODUCTION COMPANY, OR WHICH IS A SOLE  PROPRIE-
 TOR  OF  OR  A  MEMBER  OF  A  PARTNERSHIP  WHICH  IS  A QUALIFIED MUSIC
 PRODUCTION COMPANY OR A QUALIFIED INDEPENDENT MUSIC PRODUCTION  COMPANY,
 AND  WHICH  IS SUBJECT TO TAX UNDER ARTICLE NINE-A OR TWENTY-TWO OF THIS
 CHAPTER, SHALL BE ALLOWED A CREDIT AGAINST SUCH TAX.
   (2) THE AMOUNT OF THE CREDIT SHALL BE THE PRODUCT (OR PRO  RATA  SHARE
 OF THE PRODUCT, IN THE CASE OF A MEMBER OF A PARTNERSHIP) OF TWENTY-FIVE
 PERCENT  AND  THE  QUALIFIED  PRODUCTION COSTS PAID IN THE PRODUCTION OF
 MUSIC BY THE TAXPAYER. QUALIFYING MUSIC PRODUCTIONS SHALL BE COMMERCIAL-
 LY LICENSED SOUND RECORDING PROJECTS HAVING AS THEIR PRINCIPAL PLACE  OF
 PRODUCTION AND RECORDING THIS STATE AND REQUIRING EXPENDITURES IN EXCESS
 OF  TWENTY-FIVE THOUSAND DOLLARS. IF THE ANNUAL COST OF SUCH PRODUCTIONS
 TO A TAXPAYER EXCEEDS ONE HUNDRED THOUSAND DOLLARS, BUT NO  SINGLE  SUCH
 PRODUCTION EXCEEDS ONE HUNDRED THOUSAND DOLLARS, SUCH TAXPAYER MAY APPLY
 FOR  THE  CREDIT  ALLOWED BY THIS SECTION ON AN AGGREGATE BASIS PROVIDED
 SUCH TAXPAYER EMPLOYS TEN OR MORE RESIDENTS  OF  THIS  STATE.  QUALIFIED
 PRODUCTION  COSTS  SHALL  MEAN  COSTS  FOR  TANGIBLE  PROPERTY  USED AND
 SERVICES PERFORMED DIRECTLY AND PREDOMINANTLY IN THE PRODUCTION OF QUAL-
 IFIED MUSIC PRODUCTION IN THIS STATE.  QUALIFYING MUSIC PRODUCTION COSTS
 SHALL INCLUDE STUDIO RENTAL  FEES  AND  RELATED  COSTS;  INSTRUMENT  AND
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
              

                                                            LBD10476-01-9

 S. 4918                             2
 
 EQUIPMENT  RENTAL  FEES; PRODUCTION SESSION FEES FOR MUSICIANS, SONGWRI-
 TERS, COMPOSERS, ARRANGERS, MUSIC PRODUCERS, PROGRAMMERS, ENGINEERS  AND
 TECHNICIANS;   MIXING   AND   MASTERING  SERVICES  OF  QUALIFYING  MUSIC
 PRODUCTIONS;  AND  HOTEL  CATERING AND LOCAL TRANSPORTATION EXPENDITURES
 DIRECTLY RELATED TO MUSIC PRODUCTION. COSTS SHALL NOT INCLUDE  RECORDING
 LIVE  CONCERTS;  ARTISTS  AND  PRODUCER ROYALTIES OR ADVANCES; LICENSING
 FEES FOR SAMPLES; INTERPOLATIONS OR OTHER MUSIC CLEARANCE COSTS; MASTER-
 ING OR POST-PRODUCTION EXPENDITURES FOR PROJECTS THAT WERE  NOT  PRINCI-
 PALLY  TRACKED AND RECORDED IN THIS STATE; NOR ANY COSTS ASSOCIATED WITH
 MANUFACTURING, DUPLICATION, PACKAGING, DISTRIBUTION, PROMOTION,  MARKET-
 ING AND TOURING NOT SPECIFICALLY OUTLINED ABOVE.
   (3)  NO QUALIFIED PRODUCTION COSTS USED BY A TAXPAYER AS THE BASIS FOR
 THE ALLOWANCE OF THE CREDIT PROVIDED FOR UNDER  THIS  SECTION  SHALL  BE
 USED BY SUCH TAXPAYER TO CLAIM ANY OTHER CREDIT ALLOWED PURSUANT TO THIS
 CHAPTER.
   (B)  ALLOCATION OF CREDIT. THE AGGREGATE AMOUNT OF TAX CREDITS ALLOWED
 UNDER THIS SECTION, SUBDIVISION FIFTY-THREE OF SECTION TWO HUNDRED TEN-B
 AND SUBSECTION (JJJ) OF SECTION SIX HUNDRED SIX OF THIS CHAPTER  IN  ANY
 CALENDAR  YEAR  SHALL BE TWENTY-FIVE MILLION DOLLARS AND ONE MILLION TWO
 HUNDRED FIFTY THOUSAND DOLLARS IN ANY GIVEN WEEK. SUCH AGGREGATE  AMOUNT
 OF  CREDITS  SHALL  BE  ALLOCATED BY THE EMPIRE STATE DEVELOPMENT CORPO-
 RATION AMONG TAXPAYERS IN ORDER OF  PRIORITY  BASED  UPON  THE  DATE  OF
 FILING  AN  APPLICATION  FOR  ALLOCATION OF MUSIC PRODUCTION CREDIT WITH
 SUCH OFFICE.  NO SINGLE TAXPAYER MAY CLAIM OR BE AWARDED MORE  THAN  TEN
 PERCENT  OF  THE  AGGREGATE  AMOUNT  OF  TAX  CREDITS ALLOWED UNDER THIS
 SECTION.  IF THE TOTAL AMOUNT OF ALLOCATED CREDITS APPLIED  FOR  IN  ANY
 PARTICULAR  YEAR EXCEEDS THE AGGREGATE AMOUNT OF TAX CREDITS ALLOWED FOR
 SUCH YEAR UNDER THIS SECTION, SUCH EXCESS SHALL  BE  TREATED  AS  HAVING
 BEEN APPLIED FOR ON THE FIRST DAY OF THE SUBSEQUENT YEAR.
   (C)  CROSS-REFERENCES.  FOR  APPLICATION OF THE CREDIT PROVIDED FOR IN
 THIS SECTION, SEE THE FOLLOWING PROVISIONS OF THIS CHAPTER:
   (1) ARTICLE 9-A: SECTION 210-B: SUBDIVISION 53
   (2) ARTICLE 22: SECTION 606: SUBSECTION (JJJ)
   § 2. Section 210-B of the tax law is amended by adding a new  subdivi-
 sion 53 to read as follows:
   53.  EMPIRE  STATE MUSIC PRODUCTION CREDIT. (A) ALLOWANCE OF CREDIT. A
 TAXPAYER WHO IS ELIGIBLE PURSUANT TO SECTION FORTY-FOUR OF THIS  CHAPTER
 SHALL  BE  ALLOWED  A  CREDIT TO BE COMPUTED AS PROVIDED IN SUCH SECTION
 FORTY-FOUR AGAINST THE TAX IMPOSED BY THIS ARTICLE.
   (B) 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 AMOUNT PRESCRIBED  IN  PARAGRAPH  (D)  OF  SUBDIVISION  ONE  OF
 SECTION TWO HUNDRED TEN OF THIS ARTICLE.  PROVIDED, HOWEVER, THAT IF THE
 AMOUNT  OF  THE  CREDIT ALLOWABLE UNDER THIS SUBDIVISION FOR ANY TAXABLE
 YEAR REDUCES THE TAX TO SUCH AMOUNT, THE EXCESS 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 EIGHT-
 Y-EIGHT OF THIS CHAPTER NOTWITHSTANDING, NO INTEREST SHALL BE PAID THER-
 EON.
   § 3. 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) EMPIRE STATE MUSIC            AMOUNT OF CREDIT FOR
 PRODUCTION CREDIT UNDER              QUALIFIED PRODUCTION CREDIT
 SUBSECTION (JJJ)                     MUSIC UNDER SUBDIVISION

 S. 4918                             3
 
                                      FIFTY-THREE OF SECTION TWO
                                      HUNDRED TEN-B
   §  4. Section 606 of the tax law is amended by adding a new subsection
 (jjj) to read as follows:
   (JJJ) EMPIRE STATE MUSIC PRODUCTION CREDIT. (1) ALLOWANCE OF CREDIT. A
 TAXPAYER WHO IS ELIGIBLE PURSUANT TO SECTION FORTY-FOUR OF THIS  CHAPTER
 SHALL  BE  ALLOWED  A  CREDIT TO BE COMPUTED AS PROVIDED IN SUCH SECTION
 FORTY-FOUR AGAINST THE TAX IMPOSED BY THIS ARTICLE.
   (2) 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.
   §  5.  The  empire state development corporation shall conduct a study
 analyzing the economic impact of the tax credit authorized  pursuant  to
 section  one  of this act and shall report its findings, conclusions and
 recommendations to the governor and the legislature  on  or  before  one
 year  from  the  date this act shall become a law, and shall submit with
 its report such legislative proposals as it deems necessary to implement
 its recommendations.   The empire state  development  corporation  shall
 list the recipients of the tax credit authorized pursuant to section one
 of this act on their official internet website.
   § 6. This act shall take effect on the one hundred eightieth day after
 it shall have become a law.