Senate Bill S1320

                                 
BILL NUMBER: S1320

SPONSOR: HOYLMAN-SIGAL
 
TITLE OF BILL:

An act to amend the tax law and the state finance law, in relation to
the transfer of funds into the metropolitan transportation authority aid
trust account and the public  transportation system operating assistance
account

 
PURPOSE:

Ensures a percentage of sales tax revenue collected from transportation
network company services are dedicated to the Metropolitan Transporta-
tion Authority Aid Trust Account and the Public Transportation System
Operating Assistance Account.

 
SUMMARY OF PROVISIONS:

Section 1: Amends paragraph 10 of subdivision (c) of section 1105 of the
tax law, as added by section 2 of part U-1 of chapter 57 of the laws of
2009 to include transportation network companies.
              

Section 2: Amends subdivision 6 of section 92-ff of the state finance
law by adding a new paragraph (c) that dedicates one-fourth of sales tax
revenues generated by transportation network company rides in the MTA
region to the Metropolitan Transportation Authority Aid Trust Account,
and ensures that this account receives an amount based on historical
precedent.

Section 3: Amends subdivision 5 of section 88-a of the state finance law
by adding a new paragraph (d) that dedicates one-fourth of sales tax
revenues generated by transportation network company rides occurring
outside of the MTA region to the Public Transportation System Operating
Assistance Account, while ensuring that this does not affect previous
account adjustments that are indexed to regional sales tax growth.

Section 4: Provides for an immediate effective date.

 
JUSTIFICATION:

In 2009, the State took action to stabilize the MTA's economic outlook
to the benefit of its ridership as well as the state's economy as a
whole. In addition to structural reforms, the package staved off draco-
nian service cuts and fare increases while supporting the Authority's
ability to maintain its system in good repair. A component of this pack-
age established a $.50 surcharge on yellow taxi. rides within the City
of New York. With the recent advent of nontraditional transportation
services, revenue from this fee and subsequent deposits into the MTA Aid
Trust Account has declined. Recent projections from the MTA have indi-
cated a loss of as much as $10 million per year from this revenue
source, despite the expansion of nontraditional transportation services.
Currently, rides provided by transportation network companies - includ-
ing Uber and Lyft - do not include the $.50 surcharge that goes to the
MTA. Instead, they pay sales taxes which are split between the State's
General Fund and affected locality.

Indeed, one estimate an Uber official made is is that it will pay as
much as $100 million in sales taxes in 2016. However, only a minor
percentage - three-eighths of one percent of the State's sales tax
revenue is directed into MTA operating revenues. This legislation seeks
to address the loss in revenue by directing $10 million of sales and
compensating use taxes collected in the twelve-county MTA region to the
authority's aid trust account in 2016. Furthermore, it ensures that
twenty-five percent of sales tax gross receipts generated by transporta-
tion network company rides- roughly .50 per ride - are provided to the
MTA Aid Trust Account, while also ensuring that a minimum of $85 million
of revenues are dedicated to the trust account in 2017. Lastly, it
indexes the baseline in subsequent years to the consumer cost change
factor.

In anticipation of the impacts that transportation network company
activity will have on Upstate New York, this legislation also dedicates
twenty-five percent of sales and compensating use taxes collected from
transportation network company rides outside of the metropolitan trans-
portation region to the Public Transportation System Operating Assist-
ance (PTOA) account should the service be expanded. Further, these
revenues shall not affect previous efforts undertaken by the State to
index PTOA to sales tax growth.

Like its downstate counterparts, upstate transit providers have experi-
enced significant ridership growth and increased needs in recent years,
and this legislation intends to provide an equal rate of assistance to
these providers if nontraditional transportation services proliferate
Upstate.

 
LEGISLATIVE HISTORY:

Died in Investigations and Government in Investigations and Government

S.164 of 2023-2024 (Hoylman-Sigal): Operations in Investigations and
Government

S.4283 of 2021-2022 (Hoylman): Died Operations

S.0302 of 2019-2020 (Hoylman): Died Operations

A.2533 of 2019-2020 (Rodriguez): Died in Ways and Means

S.2931 of 2017-2018 (Dilan): Died in Investigations and Government Oper-
ations

S.6470 of 2016 (Dilan): Died in Investigations and Government Operations

A.9087 of 2016 (Rodriguez): Died in Ways and Means

 
FISCAL IMPLICATIONS:

This legislation does not increase any taxes or fees. It simply dedi-
cates a percentage of sales and compensating use tax revenues to tran-
sit-related purposes. Based on current ridership data, it is anticipated
that revenues dedicated to these accounts will range from twenty-five to
fifty cents per ride, depending on the region and price of the ride.

 
EFFECTIVE DATE:
Immediate