Senate Bill S9259

                             
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   9259
 
                             I N  S E N A T E
 
                             February 19, 2026
                                ___________
 
 Introduced  by  Sen.  FAHY  --  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 creating an office to  resi-
   dential  conversion  tax  credit and a historic preservation rehabili-
   tation office to residential conversion tax credit; and providing  for
   the repeal of such provisions upon expiration thereof
 
   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 36-a to read
 as follows:
   § 36-A. OFFICE TO RESIDENTIAL CONVERSION TAX CREDIT.  (A)  GENERAL.  A
 TAXPAYER SHALL BE ALLOWED A CREDIT AGAINST THE TAX IMPOSED BY THIS ARTI-
 CLE  IN  AN  AMOUNT EQUAL TO TEN PERCENT OF THE QUALIFIED REHABILITATION
 EXPENDITURES, AS DEFINED IN SUBDIVISION (C) OF  THIS  SECTION,  PAID  OR
 INCURRED  BY  THE TAXPAYER WITH RESPECT TO ANY QUALIFIED OFFICE TO RESI-
 DENTIAL CONVERSION PROJECT,  AS  DEFINED  IN  SUBDIVISION  (B)  OF  THIS
 SECTION.  SUCH  CREDIT  SHALL  BE  REFUNDABLE  IN  ACCORDANCE  WITH  THE
 PROVISIONS OF SECTION SIX HUNDRED EIGHTY-SIX OF THIS CHAPTER.
   (B) QUALIFIED OFFICE TO RESIDENTIAL CONVERSION PROJECT.  FOR  PURPOSES
 OF  THIS SECTION, A "QUALIFIED OFFICE TO RESIDENTIAL CONVERSION PROJECT"
 SHALL MEAN THE SUBSTANTIAL REHABILITATION OF A QUALIFIED  BUILDING  THAT
 MEETS THE FOLLOWING REQUIREMENTS:
   (1)  THE  BUILDING IS LOCATED IN A CITY, TOWN, OR VILLAGE WITH A POPU-
 LATION UNDER ONE MILLION RESIDENTS AND WAS PLACED IN SERVICE AS  A  NON-
 RESIDENTIAL  OR  OTHER  INCOME-PRODUCING  PROPERTY  WITHIN THE TEN YEARS
 PRECEDING THE DATE OF APPLICATION, PROVIDED THAT SUCH BUILDING  WAS  NOT
 USED AS RENTAL RESIDENTIAL PROPERTY DURING SUCH PERIOD;
   (2)  NO  LESS  THAN  FIFTY  PERCENT OF THE GROSS SQUARE FOOTAGE OF THE
 BUILDING FOLLOWING REHABILITATION SHALL BE RESIDENTIAL;
   (3) THE BUILDING CONTAINS AT LEAST TWENTY-FIVE THOUSAND  GROSS  SQUARE
 FEET;
   (4)  NO  LESS THAN FIFTY PERCENT OF THE BUILDING WAS PHYSICALLY VACANT
 AS OF JANUARY FIRST, TWO THOUSAND TWENTY-SIX;
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
              

                                                            LBD14451-02-6
 S. 9259                             2
 
   (5) THE BUILDING IS NOT LISTED ON THE STATE REGISTER OF HISTORIC PLAC-
 ES OR THE NATIONAL REGISTER OF HISTORIC PLACES,  NOR  IS  SUCH  BUILDING
 LOCATED  WITHIN A REGISTERED HISTORIC DISTRICT AND CERTIFIED AS BEING OF
 HISTORIC SIGNIFICANCE TO SUCH DISTRICT;
   (6)  THE  SUBSTANTIAL  REHABILITATION  MEETS  THE FOLLOWING STRUCTURAL
 RETENTION REQUIREMENTS:
   (I) AT LEAST FIFTY PERCENT OF THE EXISTING EXTERNAL WALLS ARE RETAINED
 IN PLACE AS EXTERNAL WALLS;
   (II) AT LEAST SEVENTY-FIVE PERCENT OF THE EXISTING EXTERNAL WALLS  ARE
 RETAINED IN PLACE AS EITHER EXTERNAL WALLS OR INTERNAL WALLS; AND
   (III)  AT  LEAST  SEVENTY-FIVE PERCENT OF THE EXISTING INTERNAL STRUC-
 TURAL FRAMEWORK REMAINS IN PLACE; AND
   (7) THE QUALIFIED REHABILITATION EXPENDITURES FOR SUCH PROJECT ARE NOT
 LESS THAN TWO MILLION FIVE HUNDRED THOUSAND DOLLARS.
   (C)  QUALIFIED  REHABILITATION  EXPENDITURES.  FOR  PURPOSES  OF  THIS
 SECTION,  "QUALIFIED  REHABILITATION  EXPENDITURES"  SHALL HAVE THE SAME
 MEANING AS SET FORTH IN SECTION 47(C)(2) OF THE INTERNAL  REVENUE  CODE,
 AS AMENDED, AND APPLICABLE REGULATIONS PROMULGATED THEREUNDER.
   (D) LIMITATION ON CREDIT AMOUNT. THE CREDIT ALLOWED UNDER THIS SECTION
 SHALL  NOT  EXCEED FIVE MILLION DOLLARS PER QUALIFIED OFFICE TO RESIDEN-
 TIAL CONVERSION PROJECT.
   (E) AGGREGATE CREDIT CAP. THE  AGGREGATE  AMOUNT  OF  CREDITS  ALLOWED
 PURSUANT  TO  THIS SECTION SHALL NOT EXCEED TWENTY-FIVE MILLION DOLLARS.
 THE EMPIRE STATE DEVELOPMENT CORPORATION  SHALL  ALLOCATE  SUCH  CREDITS
 AMONG  ELIGIBLE TAXPAYERS IN SUCH MANNER AS THE CORPORATION SHALL DETER-
 MINE, GIVING DUE CONSIDERATION TO THE ORDER IN  WHICH  APPLICATIONS  ARE
 RECEIVED,  THE  POTENTIAL  ECONOMIC IMPACT OF THE PROPOSED PROJECTS, AND
 SUCH OTHER FACTORS AS THE CORPORATION DEEMS APPROPRIATE.
   (F) ADMINISTRATION. THE EMPIRE  STATE  DEVELOPMENT  CORPORATION  SHALL
 ADMINISTER  THE  CREDIT  PROVIDED  UNDER  THIS SECTION. THE EMPIRE STATE
 DEVELOPMENT CORPORATION, IN CONSULTATION WITH  THE  COMMISSIONER,  SHALL
 PROMULGATE  SUCH  RULES AND REGULATIONS AS MAY BE NECESSARY TO IMPLEMENT
 THE PROVISIONS OF THIS SECTION, INCLUDING BUT NOT LIMITED TO APPLICATION
 PROCEDURES, DOCUMENTATION REQUIREMENTS, AND STANDARDS FOR  CERTIFICATION
 OF QUALIFIED PROJECTS.
   (G)  COORDINATION  WITH  OTHER CREDITS. A TAXPAYER WHO CLAIMS A CREDIT
 UNDER THIS SECTION WITH RESPECT TO ANY PROPERTY SHALL NOT BE  ALLOWED  A
 CREDIT  UNDER  SECTION  FORTY-ONE OF THIS ARTICLE OR SECTION TWO HUNDRED
 TEN-B OF THIS CHAPTER WITH RESPECT TO THE SAME PROPERTY.
   § 2. Section 210-B of the tax law is amended by adding a new  subdivi-
 sion 63 to read as follows:
   63.  ADDITIONAL  HISTORIC REHABILITATION CREDIT FOR OFFICE TO RESIDEN-
 TIAL CONVERSIONS. (A) GENERAL. IN ADDITION TO ANY CREDIT  ALLOWED  UNDER
 SUBDIVISION  FORTY-ONE  OF  THIS SECTION, A TAXPAYER SHALL BE ALLOWED AN
 ADDITIONAL CREDIT AGAINST THE TAX IMPOSED BY THIS ARTICLE IN  AN  AMOUNT
 EQUAL  TO  TEN  PERCENT OF THE QUALIFIED REHABILITATION EXPENDITURES, AS
 DEFINED IN SUBDIVISION FORTY-ONE OF THIS SECTION, PAID  OR  INCURRED  BY
 THE  TAXPAYER WITH RESPECT TO A QUALIFIED HISTORIC OFFICE TO RESIDENTIAL
 CONVERSION PROJECT. SUCH CREDIT SHALL BE REFUNDABLE IN  ACCORDANCE  WITH
 THE PROVISIONS OF SECTION ONE THOUSAND EIGHTY-FIVE OF THIS CHAPTER.
   (B)  QUALIFIED  HISTORIC OFFICE TO RESIDENTIAL CONVERSION PROJECT. FOR
 PURPOSES OF THIS SUBDIVISION, A "QUALIFIED HISTORIC OFFICE  TO  RESIDEN-
 TIAL  CONVERSION PROJECT" SHALL MEAN THE SUBSTANTIAL REHABILITATION OF A
 CERTIFIED HISTORIC STRUCTURE, AS DEFINED  IN  SECTION  47(C)(3)  OF  THE
 INTERNAL  REVENUE  CODE,  AS  AMENDED, THAT MEETS THE FOLLOWING REQUIRE-
 MENTS:
 S. 9259                             3
 
   (1) THE BUILDING IS LOCATED IN A CITY, TOWN, OR VILLAGE WITH  A  POPU-
 LATION  UNDER  ONE MILLION RESIDENTS AND WAS PLACED IN SERVICE AS A NON-
 RESIDENTIAL OR OTHER INCOME-PRODUCING  PROPERTY  WITHIN  THE  TEN  YEARS
 PRECEDING  THE  DATE OF APPLICATION, PROVIDED THAT SUCH BUILDING WAS NOT
 USED AS RENTAL RESIDENTIAL PROPERTY DURING SUCH PERIOD;
   (2)  NO  LESS  THAN  FIFTY  PERCENT OF THE GROSS SQUARE FOOTAGE OF THE
 BUILDING FOLLOWING REHABILITATION SHALL BE RESIDENTIAL;
   (3) THE BUILDING CONTAINS AT LEAST TWENTY-FIVE THOUSAND  GROSS  SQUARE
 FEET;
   (4)  NO  LESS THAN FIFTY PERCENT OF THE BUILDING WAS PHYSICALLY VACANT
 AS OF JANUARY FIRST, TWO THOUSAND TWENTY-SIX;
   (5) THE BUILDING IS LISTED ON THE NATIONAL REGISTER OF HISTORIC PLACES
 OR IS LOCATED WITHIN A REGISTERED HISTORIC DISTRICT AND CERTIFIED BY THE
 SECRETARY OF THE INTERIOR AS BEING  OF  HISTORIC  SIGNIFICANCE  TO  SUCH
 DISTRICT;
   (6) THE REHABILITATION IS CERTIFIED BY THE STATE HISTORIC PRESERVATION
 OFFICE AS CONSISTENT WITH THE HISTORIC CHARACTER OF SUCH PROPERTY OR THE
 REGISTERED HISTORIC DISTRICT IN WHICH SUCH PROPERTY IS LOCATED; AND
   (7) THE QUALIFIED REHABILITATION EXPENDITURES FOR SUCH PROJECT ARE NOT
 LESS THAN TWO MILLION FIVE HUNDRED THOUSAND DOLLARS.
   (C)  LIMITATION ON CREDIT AMOUNT. THE CREDIT ALLOWED UNDER THIS SUBDI-
 VISION SHALL NOT EXCEED FIVE  MILLION  DOLLARS  PER  QUALIFIED  HISTORIC
 OFFICE TO RESIDENTIAL CONVERSION PROJECT.
   (D)  AGGREGATE  CREDIT  CAP.  THE  AGGREGATE AMOUNT OF CREDITS ALLOWED
 PURSUANT TO  THIS  SUBDIVISION  SHALL  NOT  EXCEED  TWENTY-FIVE  MILLION
 DOLLARS.  THE  STATE  HISTORIC  PRESERVATION  OFFICE SHALL ALLOCATE SUCH
 CREDITS AMONG ELIGIBLE TAXPAYERS IN SUCH MANNER  AS  SUCH  OFFICE  SHALL
 DETERMINE,  GIVING  DUE CONSIDERATION TO THE ORDER IN WHICH APPLICATIONS
 ARE RECEIVED, THE HISTORIC SIGNIFICANCE OF THE  PROPOSED  PROJECTS,  AND
 SUCH OTHER FACTORS AS SUCH OFFICE DEEMS APPROPRIATE.
   (E)  ADMINISTRATION.  THE  STATE  HISTORIC  PRESERVATION  OFFICE SHALL
 ADMINISTER THE CREDIT PROVIDED UNDER THIS SUBDIVISION. SUCH  OFFICE,  IN
 CONSULTATION  WITH  THE  COMMISSIONER,  SHALL  PROMULGATE SUCH RULES AND
 REGULATIONS AS MAY BE NECESSARY TO  IMPLEMENT  THE  PROVISIONS  OF  THIS
 SUBDIVISION,  INCLUDING  BUT  NOT  LIMITED  TO,  APPLICATION PROCEDURES,
 CERTIFICATION STANDARDS, DOCUMENTATION REQUIREMENTS, AND  STANDARDS  FOR
 DETERMINING CONSISTENCY WITH HISTORIC PRESERVATION STANDARDS.
   (F)  COORDINATION  WITH  OTHER CREDITS. A TAXPAYER WHO CLAIMS A CREDIT
 UNDER THIS SUBDIVISION SHALL NOT BE ALLOWED A CREDIT UNDER SECTION THIR-
 TY-SIX-A OF THIS CHAPTER WITH RESPECT TO THE SAME PROPERTY.  THE  CREDIT
 UNDER  THIS SUBDIVISION MAY BE CLAIMED IN ADDITION TO ANY CREDIT ALLOWED
 UNDER SUBDIVISION FORTY-ONE OF THIS SECTION WITH  RESPECT  TO  THE  SAME
 PROPERTY.
   §  3. This act shall take effect on the first of January next succeed-
 ing the date on which it shall have become a law, shall apply to  quali-
 fied rehabilitation expenditures paid or incurred on or after such date;
 and shall expire and be deemed repealed ten years after such date.