Senate Bill S7606A

2021-2022 Legislative Session

Clarifies that aspects of certain athletic projects should be counted as capital improvements for the brownfield redevelopment tax credit

download bill text pdf

Archive: Last Bill Status - In Senate Committee Investigations And Government Operations 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

Please enter your contact information

First Name

Last Name

Email Address

A valid email address is required.

Home address is used to determine the senate district in which you reside. Your support or opposition to this bill is then shared immediately with the senator who represents you.

Optional services from the NY State Senate:

Create an account. An account allows you to officially support or oppose key legislation, sign petitions with a single click, and follow issues, committees, and bills that matter to you. When you create an account, you agree to this platform's terms of participation.

Include a custom message for your Senator? (Optional)

Enter a message to your senator. Many New Yorkers use this to share the reasoning behind their support or opposition to the bill. Others might share a personal anecdote about how the bill would affect them or people they care about.

Actions

View Actions

Date of Action	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Mar 01, 2022	print number 7606a
Mar 01, 2022	amend and recommit to investigations and government operations
Jan 05, 2022	referred to investigations and government operations
Dec 15, 2021	referred to rules

Bill Amendments

Original

A (Active)

2021-S7606 - Details

Current Committee:: Senate Investigations And Government Operations
Law Section:: Tax Law
Laws Affected:: Amd §21, Tax L

2021-S7606 - Summary

Clarifies starting with the taxable year twenty eighteen, stadiums, parks, basketball courts and other recreational facilities shall be considered buildings, and that components of stadiums, parks, basketball courts, and other recreational facilities including sports field turf, site lighting, parking lots, sidewalks, access and entry ways, and other improvements not directly to or added to land shall be considered structural components of buildings under the internal revenue code, and shall be included in the definition of tangible property for the purposes of the brownfield redevelopment tax credit, and shall not be considered on the basis of real property.

2021-S7606 - Sponsor Memo

                                 
BILL NUMBER: S7606

SPONSOR: KENNEDY
 
TITLE OF BILL:

An act to amend the tax law, in relation to clarifying that aspects of
certain athletic projects should be counted as capital improvements for
the brownfield redevelopment tax credit

 
PURPOSE:

This legislation would amend the tangible property credit component of
the Brownfield Tax Credit to clarify that projects such as stadiums,
basketball courts, or other recreational facilities constitute buildings
for the purposes of the Federal Internal Revenue Code.

 
SUMMARY OF SPECIFIC PROVISIONS:

Section 1 Amend Section 21 of the Tax Law, as amended by Part AA of
Chapter 58 of the Laws of 2021 to clarify that stadiums, parks, basket-
ball courts, and other recreational facilities shall be considered
buildings, and their components shall be considered components of build-

ings.

Limits costs eligible for the tangible property tax credit component to
property with a depreciable life for federal tax purposes of four years
or more.

Section 2 would establish the effective date. This act shall take effect
immediately

 
JUSTIFICATION:

The Department of Tax & Finance takes a narrow view of allowable costs
under the Tangible Property Credit Component of the Brownfields Tax
Credit. The result is that the economic development impact of the Brown-
field Tax Credit is only a fraction of what it could be Statewide.

The definitions in the Internal Revenue Code, that are in some cases
over 100 years old, used by auditors at Tax & Finance exclude costs that
from an accounting perspective constitute Tangible Property. In effect,
this discourages projects that have the potential to be important
fixtures in the reinvestment of underserved neighborhoods across the
State-such as basketball courts, stadiums, or other outdoor recreation
facilities.

Due to this very narrow subset of allowable costs, developers are
unlikely to undertake projects that could benefit communities across the
State because of the lack of financial incentives. This bill would
provide clarity around these definitions-allowing costs that are, in
fact, tangible property to be reimbursed-and allow for an increased
economic impact and substantial community benefit.

This language will allow for additional investment in underserved commu-
nities as far as outdoor recreation and athletics. It would also
increase access for these populations to outdoor recreation and athlet-
ics commensurate with wealthier parts of the State.

 
LEGISLATIVE HISTORY:
New legislation

 
FISCAL IMPLICATIONS:

To be determined.

 
EFFECTIVE DATE:
This act shall take effect immediately.

2021-S7606 - Bill Text download pdf

                             
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   7606
 
                        2021-2022 Regular Sessions
 
                             I N  S E N A T E
 
                             December 15, 2021
                                ___________
 
 Introduced  by  Sen. KENNEDY -- read twice and ordered printed, and when
   printed to be committed to the Committee on Rules
 
 AN ACT to amend the tax law, in relation to clarifying that  aspects  of
   certain  athletic  projects  should be counted as capital improvements
   for the brownfield redevelopment tax credit

   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section  1.  Subparagraphs  (i) and (iv) of paragraph 3 of subdivision
 (a) of section 21 of the tax law, subparagraph (i) as amended by section
 1 of part AA of chapter 58 of the laws of  2021,  subparagraph  (iv)  as
 amended  by section 17 of part BB of chapter 56 of the laws of 2015, are
 amended to read as follows:
   (i) The tangible property credit  component  shall  be  equal  to  the
 applicable  percentage of the cost or other basis for federal income tax
 purposes of tangible personal  property  and  other  tangible  property,
 including  buildings  and  structural  components  of  buildings,  which
 constitute qualified tangible property and may include any related party
 service fee paid; provided that in determining the cost or  other  basis
 of such property, the taxpayer shall exclude the acquisition cost of any
 item  of  property with respect to which a credit under this section was
 allowable to  another  taxpayer;  AND  PROVIDED  FURTHER  THAT  FOR  THE
 PURPOSES  OF THIS SECTION, STARTING WITH TAXABLE YEAR TWO THOUSAND EIGH-
 TEEN, STADIUMS, PARKS, BASKETBALL COURTS AND OTHER RECREATIONAL  FACILI-
 TIES  SHALL  BE  CONSIDERED  BUILDINGS, AND THAT COMPONENTS OF STADIUMS,
 PARKS, BASKETBALL COURTS, AND OTHER  RECREATIONAL  FACILITIES  INCLUDING
 SPORTS FIELD TURF, SITE LIGHTING, AND OTHER IMPROVEMENTS NOT DIRECTLY TO
 OR  ADDED TO LAND SHALL BE CONSIDERED STRUCTURAL COMPONENTS OF BUILDINGS
 UNDER THE INTERNAL REVENUE CODE, AND SHALL BE INCLUDED IN THE DEFINITION
 OF TANGIBLE PROPERTY FOR THE PURPOSES OF THIS SECTION, AND SHALL NOT  BE
 CONSIDERED  ON  THE BASIS OF REAL PROPERTY.  A related party service fee
 shall be allowed only in the calculation of the tangible property credit
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD13664-01-1

 S. 7606                             2
 
 component and shall not be allowed in the calculation of the site prepa-
 ration credit component or the on-site  groundwater  remediation  credit
 component.  The  portion of the tangible property credit component which
 is  attributable  to related party service fees shall be allowed only as
 follows: (A) in the taxable year in which the qualified tangible proper-
 ty described in subparagraph  (iii)  of  this  paragraph  is  placed  in
 service,  for  that portion of the related party service fees which have
 been earned and actually paid to the related party on or before the last
 day of such taxable year; and (B) with respect to any other taxable year
 for which the tangible property credit component may  be  claimed  under
 this  subparagraph  and  in  which  the amount of any additional related
 party service fees are actually paid by  the  taxpayer  to  the  related
 party,  the  tangible property credit component for such amount shall be
 allowed in such taxable year. The credit component amount so  determined
 shall  be  allowed for the taxable year in which such qualified tangible
 property is first placed in service on a qualified site with respect  to
 which  a  certificate  of completion has been issued to the taxpayer, or
 for the taxable year in which the certificate of completion is issued if
 the qualified tangible property is placed in service prior to the  issu-
 ance  of the certificate of completion. This credit component shall only
 be allowed for up to one hundred twenty months after  the  date  of  the
 issuance  of such certificate of completion, provided, however, that for
 qualified sites to which a certificate of completion  is  issued  on  or
 after March twentieth, two thousand ten, but prior to January first, two
 thousand twelve, the commissioner may extend the credit component for up
 to one hundred forty-four months after the date of such issuance, if the
 commissioner,  in  consultation  with  the commissioner of environmental
 conservation, determines that the requirements for the credit would have
 been met if not for the restrictions related to the state disaster emer-
 gency declared pursuant to executive order 202 of 2020 or any  extension
 thereof  or  subsequent  executive order issued in response to the novel
 coronavirus (COVID-19) pandemic.
   (iv) Eligible costs for the tangible  property  credit  component  are
 limited  to  costs for tangible property that has a depreciable life for
 federal income tax purposes of [fifteen] FOUR years or more, costs asso-
 ciated with demolition and excavation on the site and the foundation  of
 any buildings constructed as part of the site cover that are not proper-
 ly  included in the site preparation component and costs associated with
 non-portable equipment, machinery and associated fixtures  and  appurte-
 nances  used exclusively on the site, whether or not such property has a
 depreciable life for federal income tax purposes of [fifteen] FOUR years
 or more.
   § 2. This act shall take effect immediately.

co-Sponsors

2021-S7606A (ACTIVE) - Details

Current Committee:: Senate Investigations And Government Operations
Law Section:: Tax Law
Laws Affected:: Amd §21, Tax L

2021-S7606A (ACTIVE) - Summary

2021-S7606A (ACTIVE) - Sponsor Memo

                                 
BILL NUMBER: S7606A

SPONSOR: KENNEDY
 
TITLE OF BILL:

An act to amend the tax law, in relation to clarifying that aspects of
certain athletic projects should be counted as capital improvements for
the brownfield redevelopment tax credit

 
PURPOSE:

This legislation would amend the tangible property credit component of
the Brownfield Tax Credit to clarify that projects such as stadiums,
basketball courts, or other recreational facilities constitute buildings
for the purposes of the Federal Internal Revenue Code.

 
SUMMARY OF SPECIFIC PROVISIONS:

Section 1 Amend Section 21 of the Tax Law, as amended by Part AA of
Chapter 58 of the Laws of 2021 to clarify that stadiums, parks, basket-
ball courts, and other recreational facilities shall be considered
buildings, and their components shall be considered components of build-

ings.

Limits costs eligible for the tangible property tax credit component to
property with a depreciable life for federal tax purposes of four years
or more.

Section 2 would establish the effective date. This act shall take effect
immediately

 
JUSTIFICATION:

The Department of Tax & Finance takes a narrow view of allowable costs
under the Tangible Property Credit Component of the Brownfields Tax
Credit. The result is that the economic development impact of the Brown-
field Tax Credit is only a fraction of what it could be Statewide.

The definitions in the Internal Revenue Code, that are in some cases
over 100 years old, used by auditors at Tax & Finance exclude costs that
from an accounting perspective constitute Tangible Property. In effect,
this discourages projects that have the potential to be important
fixtures in the reinvestment of underserved neighborhoods across the
State-such as basketball courts, stadiums, or other outdoor recreation
facilities.

Due to this very narrow subset of allowable costs, developers are
unlikely to undertake projects that could benefit communities across the
State because of the lack of financial incentives. This bill would
provide clarity around these definitions-allowing costs that are, in
fact, tangible property to be reimbursed-and allow for an increased
economic impact and substantial community benefit.

This language will allow for additional investment in underserved commu-
nities as far as outdoor recreation and athletics. It would also
increase access for these populations to outdoor recreation and athlet-
ics commensurate with wealthier parts of the State.

 
LEGISLATIVE HISTORY:
New legislation

 
FISCAL IMPLICATIONS:

To be determined.

 
EFFECTIVE DATE:
This act shall take effect immediately

2021-S7606A (ACTIVE) - Bill Text download pdf

                             
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                  7606--A
 
                        2021-2022 Regular Sessions
 
                             I N  S E N A T E
 
                             December 15, 2021
                                ___________
 
 Introduced  by  Sen. KENNEDY -- read twice and ordered printed, and when
   printed to be committed to the Committee on Rules  --  recommitted  to
   the  Committee  on Investigations and Government Operations in accord-
   ance with Senate Rule 6, sec. 8 -- committee discharged, bill amended,
   ordered reprinted as amended and recommitted to said committee

 AN ACT to amend the tax law, in relation to clarifying that  aspects  of
   certain  athletic  projects  should be counted as capital improvements
   for the brownfield redevelopment tax credit
 
   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section  1.  Subparagraphs  (i) and (iv) of paragraph 3 of subdivision
 (a) of section 21 of the tax law, subparagraph (i) as amended by section
 1 of part AA of chapter 58 of the laws of  2021,  subparagraph  (iv)  as
 amended  by section 17 of part BB of chapter 56 of the laws of 2015, are
 amended to read as follows:
   (i) The tangible property credit  component  shall  be  equal  to  the
 applicable  percentage of the cost or other basis for federal income tax
 purposes of tangible personal  property  and  other  tangible  property,
 including  buildings  and  structural  components  of  buildings,  which
 constitute qualified tangible property and may include any related party
 service fee paid; provided that in determining the cost or  other  basis
 of such property, the taxpayer shall exclude the acquisition cost of any
 item  of  property with respect to which a credit under this section was
 allowable to  another  taxpayer;  AND  PROVIDED  FURTHER  THAT  FOR  THE
 PURPOSES  OF THIS SECTION, STARTING WITH TAXABLE YEAR TWO THOUSAND EIGH-
 TEEN, STADIUMS, PARKS, BASKETBALL COURTS AND OTHER RECREATIONAL  FACILI-
 TIES  SHALL  BE  CONSIDERED  BUILDINGS, AND THAT COMPONENTS OF STADIUMS,
 PARKS, BASKETBALL COURTS, AND OTHER  RECREATIONAL  FACILITIES  INCLUDING
 SPORTS  FIELD  TURF,  SITE LIGHTING, PARKING LOTS, SIDEWALKS, ACCESS AND
 ENTRY WAYS, AND OTHER IMPROVEMENTS NOT DIRECTLY  TO  OR  ADDED  TO  LAND
 SHALL  BE CONSIDERED STRUCTURAL COMPONENTS OF BUILDINGS UNDER THE INTER-
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD13664-02-2

 S. 7606--A                          2
 
 NAL REVENUE CODE, AND SHALL BE INCLUDED IN THE  DEFINITION  OF  TANGIBLE
 PROPERTY  FOR  THE PURPOSES OF THIS SECTION, AND SHALL NOT BE CONSIDERED
 ON THE BASIS OF REAL PROPERTY.   A related party service  fee  shall  be
 allowed  only  in the calculation of the tangible property credit compo-
 nent and shall not be allowed in the calculation of the site preparation
 credit component or the on-site groundwater  remediation  credit  compo-
 nent.  The  portion  of  the tangible property credit component which is
 attributable to related party service fees  shall  be  allowed  only  as
 follows: (A) in the taxable year in which the qualified tangible proper-
 ty  described  in  subparagraph  (iii)  of  this  paragraph is placed in
 service, for that portion of the related party service fees  which  have
 been earned and actually paid to the related party on or before the last
 day of such taxable year; and (B) with respect to any other taxable year
 for  which  the  tangible property credit component may be claimed under
 this subparagraph and in which the  amount  of  any  additional  related
 party  service  fees  are  actually  paid by the taxpayer to the related
 party, the tangible property credit component for such amount  shall  be
 allowed  in such taxable year. The credit component amount so determined
 shall be allowed for the taxable year in which such  qualified  tangible
 property  is first placed in service on a qualified site with respect to
 which a certificate of completion has been issued to  the  taxpayer,  or
 for the taxable year in which the certificate of completion is issued if
 the  qualified tangible property is placed in service prior to the issu-
 ance of the certificate of completion. This credit component shall  only
 be  allowed  for  up  to one hundred twenty months after the date of the
 issuance of such certificate of completion, provided, however, that  for
 qualified  sites  to  which  a certificate of completion is issued on or
 after March twentieth, two thousand ten, but prior to January first, two
 thousand twelve, the commissioner may extend the credit component for up
 to one hundred forty-four months after the date of such issuance, if the
 commissioner, in consultation with  the  commissioner  of  environmental
 conservation, determines that the requirements for the credit would have
 been met if not for the restrictions related to the state disaster emer-
 gency  declared pursuant to executive order 202 of 2020 or any extension
 thereof or subsequent executive order issued in response  to  the  novel
 coronavirus (COVID-19) pandemic.
   (iv)  Eligible  costs  for  the tangible property credit component are
 limited to costs for tangible property that has a depreciable  life  for
 federal income tax purposes of [fifteen] FOUR years or more, costs asso-
 ciated  with demolition and excavation on the site and the foundation of
 any buildings constructed as part of the site cover that are not proper-
 ly included in the site preparation component and costs associated  with
 non-portable  equipment,  machinery and associated fixtures and appurte-
 nances used exclusively on the site, whether or not such property has  a
 depreciable life for federal income tax purposes of [fifteen] FOUR years
 or more.
   § 2. This act shall take effect immediately.

Comments

Open Legislation is a forum for New York State legislation. All comments are subject to review and community moderation is encouraged.

Comments deemed off-topic, commercial, campaign-related, self-promotional; or that contain profanity, hate or toxic speech; or that link to sites outside of the nysenate.gov domain are not permitted, and will not be published. Attempts to intimidate and silence contributors or deliberately deceive the public, including excessive or extraneous posting/posts, or coordinated activity, are prohibited and may result in the temporary or permanent banning of the user. Comment moderation is generally performed Monday through Friday. By contributing or voting you agree to the Terms of Participation and verify you are over 13.

Create an account. An account allows you to sign petitions with a single click, officially support or oppose key legislation, and follow issues, committees, and bills that matter to you. When you create an account, you agree to this platform's terms of participation.

Find your Senator and share your views on important issues.

Do you support this bill?

Senate Bill S7606A

Sponsored By

Archive: Last Bill Status - In Senate Committee Investigations And Government Operations Committee

Actions

Bill Amendments

2021-S7606 - Details

2021-S7606 - Summary

2021-S7606 - Sponsor Memo

2021-S7606 - Bill Text download pdf

co-Sponsors

2021-S7606A (ACTIVE) - Details

2021-S7606A (ACTIVE) - Summary

2021-S7606A (ACTIVE) - Sponsor Memo

2021-S7606A (ACTIVE) - Bill Text download pdf

Comments

Do you support this bill?

Get Status Alerts for 2021-S7606A

Senate Bill S7606A

Share this bill

Sponsored By

Timothy M. Kennedy

Archive: Last Bill Status - In Senate Committee Investigations And Government Operations Committee

Actions

Bill Amendments

2021-S7606 - Details

2021-S7606 - Summary

2021-S7606 - Sponsor Memo

2021-S7606 - Bill Text download pdf

co-Sponsors

Jeremy Cooney

2021-S7606A (ACTIVE) - Details

2021-S7606A (ACTIVE) - Summary

2021-S7606A (ACTIVE) - Sponsor Memo

2021-S7606A (ACTIVE) - Bill Text download pdf

Comments