S T A T E   O F   N E W   Y O R K
       ________________________________________________________________________
           S. 2609--A                                            A. 3009--A
                             S E N A T E - A S S E M B L Y
                                   January 22, 2013
                                      ___________
       IN  SENATE -- A BUDGET BILL, submitted by the Governor pursuant to arti-
         cle seven of the Constitution -- read twice and ordered  printed,  and
         when  printed to be committed to the Committee on Finance -- committee
         discharged, bill amended, ordered reprinted as amended and recommitted
         to said committee
       IN ASSEMBLY -- A BUDGET BILL, submitted  by  the  Governor  pursuant  to
         article  seven  of  the  Constitution -- read once and referred to the
         Committee on Ways and Means --  committee  discharged,  bill  amended,
         ordered reprinted as amended and recommitted to said committee
       AN  ACT  to amend the tax law, in relation to the temporary metropolitan
         transportation business tax surcharge (Part A); to amend the tax  law,
         in  relation to the empire state film production credit and the empire
         state film post production credit; and to amend part Y-1 of chapter 57
         of the laws of 2009 amending the tax law relating to the empire  state
         film  production credit, in relation to reports (Part B); to amend the
         economic development law, the tax law and the administrative  code  of
         the  city  of New York, in relation to establishing the New York inno-
         vation hot spot program (Part C); to amend the tax law and the  admin-
         istrative  code  of the city of New York, in relation to extending for
         three years the charitable contributions  deduction  limitation  (Part
         D);  to  amend  the tax law and the administrative code of the city of
         New York, in relation to the exclusion  of  certain  royalty  payments
         from  the  entire  net  income or other taxable basis of corporations,
         banking corporations, and insurance corporations, from  the  unrelated
         business income of corporations, and from the adjusted gross income of
         individual  taxpayers; and to repeal certain provisions of the tax law
         relating thereto (Part E); to amend the tax law, in  relation  to  the
         historic  preservation  tax  credit (Part F); to amend the tax law, in
         relation to providing a tax credit  for  electric  vehicle  recharging
         property  (Part  G);  to amend chapter 61 of the laws of 2011 amending
         the real property tax law and  other  laws  relating  to  establishing
         standards for electronic real property tax administration, in relation
         to  making  permanent,  provisions  relating  to  mandatory electronic
         filing of tax documents and improving  sales  tax  compliance  and  to
         repeal  certain  provisions of the tax law and the administrative code
         of the city of New York relating thereto (Part H); to  amend  the  tax
        EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                             [ ] is old law to be omitted.
                                                                  LBD12574-02-3
       S. 2609--A                          2                         A. 3009--A
         law,  in  relation to exempting sales made at a Taste-NY facility from
         sales and compensating use taxes; and to amend the alcoholic  beverage
         control  law,  in relation to allowing sales of all types of alcoholic
         beverages at a Taste-NY facility (Part I); to amend the general munic-
         ipal  law  and  the  public authorities law, in relation to industrial
         development agencies and authorities (Part J); to amend the  tax  law,
         in  relation  to  expanding  the  exemption of CNG in the sales tax to
         include natural gas purchased and used to produce CNG for  use  exclu-
         sively  and  directly  in  the  engine of a motor vehicle (Part K); to
         amend the  tax  law,  in  relation  to  allowing  voluntary  ambulance
         services,  fire companies, fire departments and rescue squads to claim
         reimbursement of the petroleum business tax for  fuel  used  in  their
         vehicles  (Part  L); to amend the tax law, in relation to the power of
         the commissioner of taxation and finance to refuse to issue a  certif-
         icate of authority to collect the sales and use taxes and the power of
         the  commissioner of taxation and finance to revoke such a certificate
         once granted and penalties related to  the  operation  of  a  business
         without  such  certificate (Part M); to amend the tax law, in relation
         to allowing the department of taxation and finance to refuse a certif-
         icate of registration to retail  dealers  of  cigarettes  and  tobacco
         products  if  such  dealers  have certain tax liabilities or have been
         convicted of a tax crime within one year of applying for or renewing a
         certificate of registration  (Part  N);  to  amend  the  tax  law,  in
         relation to increasing the penalty for the possession of unstamped and
         unlawfully  stamped  cigarettes  (Part  O);  to amend the tax law, the
         vehicle and traffic law and the insurance  law,  in  relation  to  the
         suspension  of  drivers' licenses of persons who are delinquent in the
         payment of past-due tax liabilities (Part P); to amend the tax law, in
         relation to serving an income execution with respect to individual tax
         debtors without filing a warrant (Part Q); to amend the  tax  law,  in
         relation to the authority of counties to impose sales and compensating
         use  taxes pursuant to the authority of article 29 of such law; and to
         repeal certain provisions of sections 1210 and 1224 and section 1210-E
         of such law relating thereto (Part  R);  to  amend  the  tax  law,  in
         relation  to a keno style lottery game (Part S); to amend the tax law,
         in relation to vendor fees paid to vendor tracks (Part  T);  to  amend
         the  racing,  pari-mutuel  wagering  and  breeding law, in relation to
         licenses for simulcast facilities, sums relating to  track  simulcast,
         simulcast  of  out-of-state  thoroughbred races, simulcasting of races
         run by out-of-state harness tracks and  distributions  of  wagers;  to
         amend chapter 281 of the laws of 1994, amending the racing, pari-mutu-
         el  wagering  and breeding law and other laws relating to simulcasting
         and chapter 346 of the laws of 1990, amending the racing,  pari-mutuel
         wagering  and breeding law and other laws relating to simulcasting and
         the imposition of certain  taxes,  in  relation  to  making  permanent
         certain  provisions thereof; to amend the racing, pari-mutuel wagering
         and breeding law, in relation to making permanent  certain  provisions
         thereof;  and  to  repeal subdivision 5 of section 1012 of the racing,
         pari-mutuel wagering and breeding law relating to  telephone  accounts
         and  telephone  wagering  and  section 1014 of the racing, pari-mutuel
         wagering and breeding law relating  to  simulcasting  of  out-of-state
         thoroughbred  races (Part U); and to amend the tax law, in relation to
         the credit for the rehabilitation of historic homes (Part V)
       S. 2609--A                          3                         A. 3009--A
         THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
       BLY, DO ENACT AS FOLLOWS:
    1    Section  1.  This  act enacts into law major components of legislation
    2  which are necessary to implement the state fiscal plan for the 2013-2014
    3  state fiscal year. Each component is  wholly  contained  within  a  Part
    4  identified  as Parts A through V. The effective date for each particular
    5  provision contained within such Part is set forth in the last section of
    6  such Part. Any provision in any section contained within a Part, includ-
    7  ing the effective date of the Part, which makes a reference to a section
    8  "of this act", when used in connection with that  particular  component,
    9  shall  be  deemed  to mean and refer to the corresponding section of the
   10  Part in which it is found. Section three of  this  act  sets  forth  the
   11  general effective date of this act.
   12                                   PART A
   13    Section  1.  Subdivision 1 of section 183-a of the tax law, as amended
   14  by section 1 of part II-1 of chapter 57 of the laws of 2008, is  amended
   15  to read as follows:
   16    1.  The  term  "corporation"  as used in this section shall include an
   17  association, within the meaning of paragraph three of subsection (a)  of
   18  section  seventy-seven hundred one of the internal revenue code (includ-
   19  ing a limited liability company), a publicly traded partnership  treated
   20  as  a  corporation for purposes of the internal revenue code pursuant to
   21  section seventy-seven hundred four thereof and any business conducted by
   22  a trustee or trustees wherein interest  or  ownership  is  evidenced  by
   23  certificates  or  other  written  instruments. Every corporation, joint-
   24  stock company or association formed for or principally  engaged  in  the
   25  conduct  of  canal,  steamboat,  ferry (except a ferry company operating
   26  between any of the boroughs of the city of New York under a lease grant-
   27  ed by the city),  express,  navigation,  pipe  line,  transfer,  baggage
   28  express,  omnibus,  taxicab, telegraph, or telephone business, or formed
   29  for or principally engaged in the conduct of  two  or  more  such  busi-
   30  nesses, and every corporation, joint-stock company or association formed
   31  for  or  principally  engaged  in the conduct of a railroad, palace car,
   32  sleeping car or trucking business or formed for or  principally  engaged
   33  in  the  conduct of two or more of such businesses and which has made an
   34  election pursuant to subdivision ten of section one hundred eighty-three
   35  of this article, and every other  corporation,  joint-stock  company  or
   36  association  principally  engaged  in the conduct of a transportation or
   37  transmission business, except  a  corporation,  joint-stock  company  or
   38  association  formed for or principally engaged in the conduct of a rail-
   39  road, palace car, sleeping car or trucking business  or  formed  for  or
   40  principally engaged in the conduct of two or more of such businesses and
   41  which  has  not  made  the  election  provided for in subdivision ten of
   42  section one hundred eighty-three of this article, and  except  a  corpo-
   43  ration,  joint-stock  company  or association principally engaged in the
   44  conduct of aviation (including air freight forwarders acting as  princi-
   45  pal and like indirect air carriers) and except a corporation principally
   46  engaged  in  providing  telecommunication  services between aircraft and
   47  dispatcher, aircraft and air  traffic  control  or  ground  station  and
   48  ground  station  (or  any combination of the foregoing), at least ninety
   49  percent of the voting stock of which corporation is owned,  directly  or
   50  indirectly,  by  air carriers and which corporation's principal function
   51  is to fulfill the requirements of  (i)  the  federal  aviation  adminis-
       S. 2609--A                          4                         A. 3009--A
    1  tration  (or  the  successor  thereto)  or  (ii) the international civil
    2  aviation organization (or the successor thereto), relating to the exist-
    3  ence of a communication system between aircraft and dispatcher, aircraft
    4  and  air  traffic  control  or ground station and ground station (or any
    5  combination of the foregoing) for the purposes of air safety and naviga-
    6  tion and except a corporation, joint-stock company or association  which
    7  is  liable  to  taxation under article thirty-two of this chapter, shall
    8  pay for the privilege of exercising its corporate franchise, or of doing
    9  business, or of employing capital, or of owning or leasing  property  in
   10  the  metropolitan  commuter transportation district in such corporate or
   11  organized capacity, or of maintaining an office in such district, a  tax
   12  surcharge  for all or any part of its years commencing on or after Janu-
   13  ary first, nineteen hundred eighty-two but ending before December  thir-
   14  ty-first,  two  thousand  [thirteen]  EIGHTEEN,  which tax surcharge, in
   15  addition to the tax imposed by section one hundred eighty-three of  this
   16  article,  shall  be  computed at the rate of eighteen percent of the tax
   17  imposed under such section one hundred eighty-three for  such  years  or
   18  any  part  of  such  years ending before December thirty-first, nineteen
   19  hundred eighty-three after the deduction of any credits otherwise allow-
   20  able under this article, and at the rate of seventeen percent of the tax
   21  imposed under such section for such years or  any  part  of  such  years
   22  ending  on or after December thirty-first, nineteen hundred eighty-three
   23  after the deduction of any credits otherwise allowable under this  arti-
   24  cle;  provided,  however,  that  such  rates  of  tax surcharge shall be
   25  applied only to that portion  of  the  tax  imposed  under  section  one
   26  hundred  eighty-three of this article after the deduction of any credits
   27  otherwise allowable under this article  which  is  attributable  to  the
   28  taxpayer's business activity carried on within the metropolitan commuter
   29  transportation district as so determined in the manner prescribed by the
   30  rules  and  regulations  promulgated  by the commissioner; and provided,
   31  further, that the tax surcharge imposed by this  section  shall  not  be
   32  imposed  upon  any taxpayer for more than [three] FOUR hundred [seventy-
   33  two] THIRTY-TWO months.
   34    S 2. The opening paragraph of subdivision 1 of section  184-a  of  the
   35  tax  law, as amended by section 2 of part II-1 of chapter 57 of the laws
   36  of 2008, is amended to read as follows:
   37    The term "corporation" as used in this section shall include an  asso-
   38  ciation,  within  the  meaning  of  paragraph three of subsection (a) of
   39  section seventy-seven hundred one of the internal revenue code  (includ-
   40  ing  a  limited  liability  company),  and a publicly traded partnership
   41  treated as a corporation for  purposes  of  the  internal  revenue  code
   42  pursuant  to  section  seventy-seven hundred four thereof.  Every corpo-
   43  ration, joint-stock company or association  formed  for  or  principally
   44  engaged in the conduct of canal, steamboat, ferry (except a ferry compa-
   45  ny operating between any of the boroughs of the city of New York under a
   46  lease  granted  by  the city), express, navigation, pipe line, transfer,
   47  baggage express, omnibus, taxicab, telegraph or  local  telephone  busi-
   48  ness, or formed for or principally engaged in the conduct of two or more
   49  such  businesses,  and every corporation, joint-stock company or associ-
   50  ation formed for or principally engaged in  the  conduct  of  a  surface
   51  railroad,  whether  or  not operated by steam, subway railroad, elevated
   52  railroad, palace car, sleeping car or trucking business  or  principally
   53  engaged in the conduct of two or more such businesses and which has made
   54  an  election  pursuant to subdivision ten of section one hundred eighty-
   55  three of this article, and every other corporation, joint-stock  company
   56  or  association  formed  for  or principally engaged in the conduct of a
       S. 2609--A                          5                         A. 3009--A
    1  transportation or transmission business (other than  a  telephone  busi-
    2  ness)  except  a  corporation, joint-stock company or association formed
    3  for or principally engaged in the conduct of a surface railroad, whether
    4  or  not  operated  by  steam, subway railroad, elevated railroad, palace
    5  car, sleeping car or trucking business or  principally  engaged  in  the
    6  conduct  of  two  or  more  such  businesses  and which has not made the
    7  election provided for in subdivision ten of section one hundred  eighty-
    8  three  of this article, and except a corporation, joint-stock company or
    9  association principally engaged in the conduct  of  aviation  (including
   10  air  freight forwarders acting as principal and like indirect air carri-
   11  ers) and except a corporation principally engaged in providing  telecom-
   12  munication  services  between  aircraft and dispatcher, aircraft and air
   13  traffic control or ground station and ground station (or any combination
   14  of the foregoing), at least ninety percent of the voting stock of  which
   15  corporation  is owned, directly or indirectly, by air carriers and which
   16  corporation's principal function is to fulfill the requirements  of  (i)
   17  the  federal  aviation administration (or the successor thereto) or (ii)
   18  the international civil aviation organization (or the  successor  there-
   19  to),  relating  to  the  existence  of  a  communication  system between
   20  aircraft and dispatcher, aircraft and  air  traffic  control  or  ground
   21  station and ground station (or any combination of the foregoing) for the
   22  purposes  of  air safety and navigation and except a corporation, joint-
   23  stock company or association which is liable to taxation  under  article
   24  thirty-two  of  this  chapter, shall pay for the privilege of exercising
   25  its corporate franchise, or of doing business, or of employing  capital,
   26  or  of owning or leasing property in the metropolitan commuter transpor-
   27  tation district in such corporate or organized capacity, or of maintain-
   28  ing an office in such district, a tax surcharge for all or any  part  of
   29  its taxable years commencing on or after January first, nineteen hundred
   30  eighty-two, but ending before December thirty-first, two thousand [thir-
   31  teen]  EIGHTEEN,  which tax surcharge, in addition to the tax imposed by
   32  section one hundred eighty-four of this article, shall  be  computed  at
   33  the  rate  of eighteen percent of the tax imposed under such section one
   34  hundred eighty-four for such taxable years or any part of  such  taxable
   35  years ending before December thirty-first, nineteen hundred eighty-three
   36  after  the deduction of any credits otherwise allowable under this arti-
   37  cle, and at the rate of seventeen percent of the tax imposed under  such
   38  section  for such taxable years or any part of such taxable years ending
   39  on or after December thirty-first, nineteen hundred  eighty-three  after
   40  the  deduction  of  any  credits otherwise allowable under this article;
   41  provided, however, that such rates of tax  surcharge  shall  be  applied
   42  only to that portion of the tax imposed under section one hundred eight-
   43  y-four  of  this  article  after  the deduction of any credits otherwise
   44  allowable under this article which is  attributable  to  the  taxpayer's
   45  business  activity carried on within the metropolitan commuter transpor-
   46  tation district; and provided, further, that the tax  surcharge  imposed
   47  by  this section on corporations, joint-stock companies and associations
   48  formed for or principally engaged in the conduct of telephone  or  tele-
   49  graph business shall be computed in accordance with this subdivision and
   50  paragraph  (c)  of subdivision two of this section as if the three-quar-
   51  ters of one percent rate of tax  provided  for  in  subdivision  one  of
   52  section  one hundred eighty-four of this article were applicable to such
   53  telephone and telegraph businesses for taxable years  commencing  on  or
   54  after  January  first,  nineteen  hundred  eighty-five  and ending on or
   55  before  December  thirty-first,  nineteen   hundred   eighty-nine;   and
   56  provided,  further, that the tax surcharge imposed by this section shall
       S. 2609--A                          6                         A. 3009--A
    1  not be imposed upon any taxpayer for  more  than  [three]  FOUR  hundred
    2  [seventy-two]  THIRTY-TWO  months.  Provided,  however, that for taxable
    3  years beginning in two thousand and thereafter,  for  purposes  of  this
    4  subdivision  the  tax  imposed  under section one hundred eighty-four of
    5  this article shall be deemed to have been imposed at the rate of  three-
    6  quarters  of  one  percent,  except  that  in the case of a corporation,
    7  joint-stock company or association which has made an  election  pursuant
    8  to  subdivision ten of section one hundred eighty-three of this article,
    9  for purposes of this subdivision  the  tax  imposed  under  section  one
   10  hundred eighty-four of this article shall be deemed to have been imposed
   11  at the rate of six-tenths of one percent.
   12    S 3. Subparagraph 1 of paragraph (a) of subdivision 1 of section 186-c
   13  of  the  tax  law, as amended by section 3 of part II-1 of chapter 57 of
   14  the laws of 2008, is amended to read as follows:
   15    (1) Every utility doing business in the metropolitan  commuter  trans-
   16  portation  district  shall  pay  a tax surcharge, in addition to the tax
   17  imposed by section one hundred eighty-six-a of this article, for all  or
   18  any  parts  of  its  taxable years commencing on or after January first,
   19  nineteen hundred eighty-two but ending before December thirty-first, two
   20  thousand [thirteen] EIGHTEEN, to be computed at  the  rate  of  eighteen
   21  percent  of  the  tax  imposed under section one hundred eighty-six-a of
   22  this article for such taxable years or any part of  such  taxable  years
   23  ending before December thirty-first, nineteen hundred eighty-three after
   24  the deduction of any credits otherwise allowable under this article, and
   25  at  the  rate of seventeen percent of the tax imposed under such section
   26  for such taxable years or any part of such taxable years  ending  on  or
   27  after  December  thirty-first,  nineteen  hundred eighty-three after the
   28  deduction of credits otherwise allowable under this article  except  any
   29  utility  credit  provided  for  by  article  thirteen-A of this chapter;
   30  provided, however, that such rates of tax  surcharge  shall  be  applied
   31  only to that portion of the tax imposed under section one hundred eight-
   32  y-six-a  of this article after the deduction of credits otherwise allow-
   33  able under this article, except any utility credit provided for by arti-
   34  cle thirteen-A of this chapter, which is attributable to the  taxpayer's
   35  gross income or gross operating income from business activity carried on
   36  within  the metropolitan commuter transportation district; and provided,
   37  further, that the tax surcharge imposed by this  section  shall  not  be
   38  imposed  upon  any taxpayer for more than [three] FOUR hundred [seventy-
   39  two] THIRTY-TWO months.
   40    S 4. Subdivision 1 of section 209-B of the  tax  law,  as  amended  by
   41  section  4 of part II-1 of chapter 57 of the laws of 2008, is amended to
   42  read as follows:
   43    1. For the privilege of exercising  its  corporate  franchise,  or  of
   44  doing business, or of employing capital, or of owning or leasing proper-
   45  ty  in a corporate or organized capacity, or of maintaining an office in
   46  the metropolitan commuter transportation district, for all or  any  part
   47  of its taxable year, there is hereby imposed on every corporation, other
   48  than  a New York S corporation, subject to tax under section two hundred
   49  nine of this article, or any receiver,  referee,  trustee,  assignee  or
   50  other  fiduciary,  or  any  officer or agent appointed by any court, who
   51  conducts the business of any such corporation,  for  the  taxable  years
   52  commencing  on  or  after January first, nineteen hundred eighty-two but
   53  ending before December thirty-first, two thousand [thirteen] EIGHTEEN, a
   54  tax surcharge, in addition to the tax imposed under section two  hundred
   55  nine  of this article, to be computed at the rate of eighteen percent of
   56  the tax imposed under such section two hundred  nine  for  such  taxable
       S. 2609--A                          7                         A. 3009--A
    1  years  or  any part of such taxable years ending before December thirty-
    2  first, nineteen hundred eighty-three after the deduction of any  credits
    3  otherwise  allowable  under  this  article, and at the rate of seventeen
    4  percent  of the tax imposed under such section for such taxable years or
    5  any part of such taxable years ending on or after December thirty-first,
    6  nineteen hundred eighty-three after the deduction of any credits  other-
    7  wise allowable under this article; provided, however, that such rates of
    8  tax  surcharge  shall be applied only to that portion of the tax imposed
    9  under section two hundred nine of this article after  the  deduction  of
   10  any credits otherwise allowable under this article which is attributable
   11  to  the  taxpayer's business activity carried on within the metropolitan
   12  commuter transportation district; and provided, further,  that  the  tax
   13  surcharge imposed by this section shall not be imposed upon any taxpayer
   14  for  more  than  [three]  FOUR  hundred [seventy-two] THIRTY-TWO months.
   15  Provided however, that for taxable years commencing  on  or  after  July
   16  first, nineteen hundred ninety-eight, such surcharge shall be calculated
   17  as if the tax imposed under section two hundred ten of this article were
   18  imposed under the law in effect for taxable years commencing on or after
   19  July  first,  nineteen hundred ninety-seven and before July first, nine-
   20  teen hundred ninety-eight. Provided  however,  that  for  taxable  years
   21  commencing on or after January first, two thousand seven, such surcharge
   22  shall  be calculated using the highest of the tax bases imposed pursuant
   23  to paragraphs (a), (b), (c) or (d) of subdivision  one  of  section  two
   24  hundred  ten  of this article and the amount imposed under paragraph (e)
   25  of subdivision one of such section two  hundred  ten,  for  the  taxable
   26  year; and, provided further that, if such highest amount is the tax base
   27  imposed  under  paragraph  (a), (b) or (c) of such subdivision, then the
   28  surcharge shall be computed as if the tax rates  and  limitations  under
   29  such  paragraph  were the tax rates and limitations under such paragraph
   30  in effect for taxable years commencing on or after July first,  nineteen
   31  hundred  ninety-seven  and  before  July first, nineteen hundred ninety-
   32  eight.
   33    S 5. Subsection 1 of section 1455-B of the  tax  law,  as  amended  by
   34  section  5 of part II-1 of chapter 57 of the laws of 2008, is amended to
   35  read as follows:
   36    1. For the privilege of exercising its franchise or doing business  in
   37  the  metropolitan  commuter  transportation  district  in a corporate or
   38  organized capacity, there is hereby imposed on every taxpayer subject to
   39  tax under this article, other than a New York  S  corporation,  for  the
   40  taxable  years  commencing  on  or after January first, nineteen hundred
   41  eighty-two but ending before December thirty-first, two thousand  [thir-
   42  teen]  EIGHTEEN,  a  tax surcharge, in addition to the tax imposed under
   43  section fourteen hundred fifty-one of this article, at the rate of eigh-
   44  teen percent of the tax imposed  under  such  section  fourteen  hundred
   45  fifty-one  of  this  article, for such taxable years or any part of such
   46  taxable years ending  before  December  thirty-first,  nineteen  hundred
   47  eighty-three  after  the  deduction  of  any credits otherwise allowable
   48  under this article, and at the rate of  seventeen  percent  of  the  tax
   49  imposed  under  such  section for such taxable years or any part of such
   50  taxable years ending on or after December thirty-first, nineteen hundred
   51  eighty-three after the deduction  of  any  credits  otherwise  allowable
   52  under  this  article; provided however, that such rates of tax surcharge
   53  shall be applied only to that portion of the tax imposed  under  section
   54  fourteen  hundred  fifty-one  of this article after the deduction of any
   55  credits otherwise allowable under this article which is attributable  to
   56  the  taxpayer's  business  activity  carried  on within the metropolitan
       S. 2609--A                          8                         A. 3009--A
    1  commuter transportation district; and provided, further,  that  the  tax
    2  surcharge imposed by this section shall not be imposed upon any taxpayer
    3  for  more  than  [three]  FOUR  hundred [seventy-two] THIRTY-TWO months.
    4  Provided  however,  that  for  taxable years commencing on or after July
    5  first, two thousand, such surcharge shall be calculated as if  the  rate
    6  of  the  basic  tax  computed  under  subsection (a) of section fourteen
    7  hundred fifty-five of this article was nine percent.
    8    S 6. Paragraphs 1 and 3 of subdivision (a) of section  1505-a  of  the
    9  tax  law, as amended by section 6 of part II-1 of chapter 57 of the laws
   10  of 2008, are amended to read as follows:
   11    (1) Every domestic insurance corporation and every  foreign  or  alien
   12  insurance corporation, and every life insurance corporation described in
   13  subdivision  (b) of section fifteen hundred one of this article, for the
   14  privilege of exercising its corporate franchise, or of  doing  business,
   15  or  of employing capital, or of owning or leasing property in the metro-
   16  politan commuter transportation district in  a  corporate  or  organized
   17  capacity,  or  of  maintaining  an  office  in the metropolitan commuter
   18  transportation district, for all  or  any  part  of  its  taxable  years
   19  commencing  on  or after January first, nineteen hundred eighty-two, but
   20  ending before December thirty-first, two thousand  [thirteen]  EIGHTEEN,
   21  except  corporations  specified  in  subdivision  (c) of section fifteen
   22  hundred twelve of this article, shall annually pay, in addition  to  the
   23  taxes  otherwise  imposed  by this article, a tax surcharge on the taxes
   24  imposed under this article after the deduction of any credits  otherwise
   25  allowable  under  this article as allocated to such district. Such taxes
   26  shall be allocated to such district for purposes of computing  such  tax
   27  surcharge upon taxpayers subject to tax under subdivision (b) of section
   28  fifteen  hundred ten of this article by applying the methodology, proce-
   29  dures and computations set forth in subdivisions (a) and (b) of  section
   30  fifteen  hundred  four  of this article, except that references to terms
   31  denoting New York premiums, and total wages, salaries, personal  service
   32  compensation  and  commissions within New York shall be read as denoting
   33  within the  metropolitan  commuter  transportation  district  and  terms
   34  denoting  total  premiums  and  total  wages, salaries, personal service
   35  compensation and commissions shall be read as denoting within the state.
   36  If it shall appear to the commissioner that the application of the meth-
   37  odology, procedures and computations set forth in such subdivisions  (a)
   38  and  (b) does not properly reflect the activity, business or income of a
   39  taxpayer within the metropolitan commuter transportation district,  then
   40  the  commissioner shall be authorized, in the commissioner's discretion,
   41  to adjust such methodology, procedures and computations for the  purpose
   42  of allocating such taxes by:
   43    (A) excluding one or more factors therein;
   44    (B)  including  one  or  more other factors therein, such as expenses,
   45  purchases, receipts other  than  premiums,  real  property  or  tangible
   46  personal property; or
   47    (C)  any  other similar or different method which allocates such taxes
   48  by attributing a fair and proper portion of such taxes to the  metropol-
   49  itan  commuter  transportation  district.  The commissioner from time to
   50  time shall publish all rulings of general public interest  with  respect
   51  to  any  application  of  the  provisions of the preceding sentence. The
   52  commissioner may promulgate rules and regulations to  further  implement
   53  the provisions of this section.
   54    (3)  Such  tax  surcharge  shall  be  computed at the rate of eighteen
   55  percent of the taxes imposed under  sections  fifteen  hundred  one  and
   56  fifteen  hundred  ten  of  this  article  as  limited by section fifteen
       S. 2609--A                          9                         A. 3009--A
    1  hundred five of this article, as allocated to such  district,  for  such
    2  taxable  years  or any part of such taxable years ending before December
    3  thirty-first, nineteen hundred eighty-three after the deduction  of  any
    4  credits otherwise allowable under this article, at the rate of seventeen
    5  percent  of  the taxes imposed under such sections as limited by section
    6  fifteen hundred five of this article, as allocated to such district, for
    7  such taxable years or any part of such taxable years ending on or  after
    8  December  thirty-first, nineteen hundred eighty-three and before January
    9  first, two thousand three after the deduction of any  credits  otherwise
   10  allowable  under  this  article, and at the rate of seventeen percent of
   11  the taxes imposed under sections fifteen hundred  one,  fifteen  hundred
   12  two-a,  and fifteen hundred ten of this article, as limited or otherwise
   13  determined by subdivision (a) or (b) of section fifteen hundred five  of
   14  this  article,  as allocated to such district, for such taxable years or
   15  any part of such taxable years ending after December  thirty-first,  two
   16  thousand  two  after  the  deduction  of any credits otherwise allowable
   17  under this article; provided, however, that the tax surcharge imposed by
   18  this section shall not be  imposed  upon  any  taxpayer  for  more  than
   19  [three]  FOUR hundred [seventy-two] THIRTY-TWO months. Provided however,
   20  that for taxable years commencing on or after July first, two  thousand,
   21  and  in  the  case  of  taxpayers  subject  to tax under section fifteen
   22  hundred two-a of this article,  for  taxable  years  of  such  taxpayers
   23  beginning on or after July first, two thousand and before January first,
   24  two  thousand  three,  such  surcharge shall be calculated as if (i) the
   25  rate of the tax computed under  paragraph  one  of  subdivision  (a)  of
   26  section  fifteen  hundred  two of this article was nine percent and (ii)
   27  the rate of the limitation on tax set forth in section  fifteen  hundred
   28  five  of  this  article for domestic, foreign and alien insurance corpo-
   29  rations except  life  insurance  corporations  was  two  and  six-tenths
   30  percent.
   31    S 7. This act shall take effect immediately.
   32                                   PART B
   33    Section  1.    Paragraph 3 of subdivision (b) of section 24 of the tax
   34  law, as added by section 1 of part P of chapter 60 of the laws of  2004,
   35  is amended to read as follows:
   36    (3)  "Qualified  film"  means  a feature-length film, television film,
   37  RELOCATED TELEVISION PRODUCTION, television pilot and/or each episode of
   38  a television series, regardless of the medium  by  means  of  which  the
   39  film,  pilot  or  episode is created or conveyed. "Qualified film" shall
   40  not include (i) a documentary film, news  or  current  affairs  program,
   41  interview  or  talk  program,  "how-to"  (i.e.,  instructional)  film or
   42  program, film or program consisting primarily of stock footage, sporting
   43  event or sporting program, game show, award ceremony,  film  or  program
   44  intended primarily for industrial, corporate or institutional end-users,
   45  fundraising film or program, daytime drama (i.e., daytime "soap opera"),
   46  commercials, music videos or "reality" program, or (ii) a production for
   47  which records are required under section 2257 of title 18, United States
   48  code,  to be maintained with respect to any performer in such production
   49  (reporting of books, films,  etc.  with  respect  to  sexually  explicit
   50  conduct).
   51    S 2. Subdivision (b) of section 24 of the tax law is amended by adding
   52  a new paragraph 8 to read as follows:
   53    (8)  "RELOCATED TELEVISION PRODUCTION" SHALL MEAN, NOTWITHSTANDING THE
   54  LIMITATIONS IN SUBPARAGRAPH (I) OF PARAGRAPH THREE OF THIS  SUBDIVISION,
       S. 2609--A                         10                         A. 3009--A
    1  A TELEVISION PRODUCTION THAT IS A TALK OR VARIETY PROGRAM THAT FILMED AT
    2  LEAST FIVE SEASONS OUTSIDE THE STATE PRIOR TO ITS FIRST RELOCATED SEASON
    3  IN  NEW  YORK,  THE  EPISODES ARE FILMED BEFORE A STUDIO AUDIENCE OF TWO
    4  HUNDRED  OR  MORE, AND THE RELOCATED TELEVISION PRODUCTION INCURS (I) AT
    5  LEAST THIRTY MILLION DOLLARS IN ANNUAL PRODUCTION COSTS IN THE STATE, OR
    6  (II) AT LEAST TEN MILLION DOLLARS IN CAPITAL EXPENDITURES AT A QUALIFIED
    7  PRODUCTION FACILITY IN THE STATE.
    8    S 3. Paragraph 4 of subdivision (e) of section 24 of the tax  law,  as
    9  added by chapter 268 of the laws of 2012, is amended to read as follows:
   10    (4) Additional pool 2 - The aggregate amount of tax credits allowed in
   11  subdivision  (a)  of  this  section  shall be increased by an [addition]
   12  ADDITIONAL four hundred twenty million dollars in EACH YEAR STARTING  IN
   13  two  thousand  ten[, four hundred twenty million dollars in two thousand
   14  eleven, four hundred twenty million dollars in two thousand twelve, four
   15  hundred twenty million dollars in two thousand thirteen and four hundred
   16  twenty million dollars in two thousand fourteen]  THROUGH  TWO  THOUSAND
   17  NINETEEN  provided  however,  seven  million dollars of the annual allo-
   18  cation shall be available for the  empire  state  film  post  production
   19  credit  pursuant  to section thirty-one of this [chapter] ARTICLE IN TWO
   20  THOUSAND THIRTEEN AND TWO  THOUSAND  FOURTEEN  AND  TWENTY-FIVE  MILLION
   21  DOLLARS OF THE ANNUAL ALLOCATION SHALL BE AVAILABLE FOR THE EMPIRE STATE
   22  FILM POST PRODUCTION CREDIT PURSUANT TO SECTION THIRTY-ONE OF THIS ARTI-
   23  CLE  IN  EACH YEAR STARTING IN TWO THOUSAND FIFTEEN THROUGH TWO THOUSAND
   24  NINETEEN.  This amount shall be allocated by the governor's  office  for
   25  motion  picture and television development among taxpayers in accordance
   26  with subdivision (a) of this section. If the [director of the governor's
   27  office for motion picture and television  development]  COMMISSIONER  OF
   28  ECONOMIC DEVELOPMENT determines that the aggregate amount of tax credits
   29  available  from  additional  pool 2 for the empire state film production
   30  tax credit have been previously allocated, and determines that the pend-
   31  ing applications from eligible applicants for the EMPIRE STATE FILM post
   32  production tax credit pursuant to section thirty-one of  this  [chapter]
   33  ARTICLE  is  insufficient  to  utilize the balance of unallocated EMPIRE
   34  STATE FILM post production tax credits from such  pool,  the  remainder,
   35  after  such pending applications are considered, shall be made available
   36  for allocation in the empire state film  tax  credit  pursuant  to  this
   37  section,   subdivision   thirty-six  of  section  two  hundred  ten  and
   38  subsection (gg) of section six hundred six of this chapter.    ALSO,  IF
   39  THE  COMMISSIONER  OF ECONOMIC DEVELOPMENT DETERMINES THAT THE AGGREGATE
   40  AMOUNT OF TAX CREDITS AVAILABLE FROM ADDITIONAL POOL 2  FOR  THE  EMPIRE
   41  STATE  FILM  POST  PRODUCTION TAX CREDIT HAVE BEEN PREVIOUSLY ALLOCATED,
   42  AND DETERMINES THAT THE PENDING APPLICATIONS  FROM  ELIGIBLE  APPLICANTS
   43  FOR THE EMPIRE STATE FILM PRODUCTION TAX CREDIT PURSUANT TO THIS SECTION
   44  IS  INSUFFICIENT  TO  UTILIZE THE BALANCE OF UNALLOCATED FILM PRODUCTION
   45  TAX CREDITS FROM SUCH POOL, THEN ALL OR PART  OF  THE  REMAINDER,  AFTER
   46  SUCH  PENDING  APPLICATIONS  ARE CONSIDERED, SHALL BE MADE AVAILABLE FOR
   47  ALLOCATION FOR THE EMPIRE STATE FILM POST PRODUCTION CREDIT PURSUANT  TO
   48  THIS  SECTION,  SUBDIVISION  FORTY-ONE  OF  SECTION  TWO HUNDRED TEN AND
   49  SUBSECTION (GG) OF SECTION SIX HUNDRED SIX OF THIS CHAPTER.  The  gover-
   50  nor's  office  for motion picture and television development must notify
   51  taxpayers of their allocation year and include the  allocation  year  on
   52  the  certificate  of  tax credit.   Taxpayers eligible to claim a credit
   53  must report the allocation year directly  on  their  empire  state  film
   54  production credit tax form for each year a credit is claimed and include
   55  a copy of the certificate with their tax return. In the case of a quali-
   56  fied  film  that  receives funds from additional pool 2, no empire state
       S. 2609--A                         11                         A. 3009--A
    1  film production credit shall be claimed before the later of the  taxable
    2  year  the  production  of the qualified film is complete, or the taxable
    3  year immediately following the allocation year for which  the  film  has
    4  been  allocated  credit  by the governor's office for motion picture and
    5  television development.
    6    S 4. Paragraph 1 of subdivision (b) of section 24 of the tax  law,  as
    7  amended  by  section  6  of part Q of chapter 57 of the laws of 2010, is
    8  amended to read as follows:
    9    (1) "Qualified production costs" means production costs  only  to  the
   10  extent  such  costs  are attributable to the use of tangible property or
   11  the performance of services within the state directly and  predominantly
   12  in  the  production  (including pre-production and post production) of a
   13  qualified film[, provided,  however,  that  qualified  production  costs
   14  shall  not  include post production costs unless the portion of the post
   15  production costs paid or incurred that is attributable  to  the  use  of
   16  tangible  property  or  the  performance  of services in New York in the
   17  production of such qualified film equals or exceeds seventy-five percent
   18  of the total post production costs spent within and without New York  in
   19  the production of such qualified film].
   20    S  5.  Paragraph 3 of subdivision (a) of section 31 of the tax law, as
   21  added by section 12 of part Q of chapter 57 of  the  laws  of  2010,  is
   22  amended to read as follows:
   23    (3) (I) A taxpayer shall not be eligible for the credit established by
   24  this  section  FOR  QUALIFIED POST PRODUCTION COSTS, EXCLUDING THE COSTS
   25  FOR VISUAL EFFECTS AND ANIMATION, unless the qualified  post  production
   26  costs, EXCLUDING THE COSTS FOR VISUAL EFFECTS AND ANIMATION, at a quali-
   27  fied post production facility meet or exceed seventy-five percent of the
   28  total  post production costs, EXCLUDING THE COSTS FOR VISUAL EFFECTS AND
   29  ANIMATION, paid or incurred in the post production of the qualified film
   30  at any post production facility.  (II) A TAXPAYER SHALL NOT BE  ELIGIBLE
   31  FOR THE CREDIT ESTABLISHED BY THIS SECTION FOR QUALIFIED POST PRODUCTION
   32  COSTS  WHICH ARE COSTS FOR VISUAL EFFECTS OR ANIMATION UNLESS THE QUALI-
   33  FIED POST PRODUCTION COSTS FOR VISUAL EFFECTS OR ANIMATION AT  A  QUALI-
   34  FIED  POST  PRODUCTION  FACILITY MEET OR EXCEED THREE MILLION DOLLARS OR
   35  TWENTY PERCENT OF THE TOTAL POST PRODUCTION COSTS FOR VISUAL EFFECTS  OR
   36  ANIMATION PAID OR INCURRED IN THE POST PRODUCTION OF A QUALIFIED FILM AT
   37  ANY  POST  PRODUCTION  FACILITY, WHICHEVER IS LESS. (III) A TAXPAYER MAY
   38  CLAIM A CREDIT FOR QUALIFIED POST PRODUCTION COSTS EXCLUDING  THE  COSTS
   39  FOR  VISUAL  EFFECTS  AND  ANIMATION,  AND FOR QUALIFIED POST PRODUCTION
   40  COSTS OF VISUAL EFFECTS AND ANIMATION, PROVIDED  THAT  THE  CRITERIA  IN
   41  SUBPARAGRAPHS  (I)  AND  (II)  OF THIS PARAGRAPH ARE BOTH SATISFIED. The
   42  credit shall be allowed for the taxable year in which the production  of
   43  such qualified film is completed.
   44    S  5-a.  Subdivision  (a)  of  section  31 of the tax law, as added by
   45  section 12 of part Q of chapter 57 of the laws of 2010,  is  amended  by
   46  adding a new paragraph 5 to read as follows:
   47    (5)  IF  THE  AMOUNT OF THE CREDIT IS AT LEAST ONE MILLION DOLLARS BUT
   48  LESS THAN FIVE MILLION DOLLARS, THE CREDIT SHALL BE CLAIMED OVER  A  TWO
   49  YEAR  PERIOD BEGINNING IN THE FIRST TAXABLE YEAR IN WHICH THE CREDIT MAY
   50  BE CLAIMED AND IN THE NEXT SUCCEEDING TAXABLE YEAR, WITH ONE-HALF OF THE
   51  AMOUNT OF CREDIT ALLOWED BEING CLAIMED IN EACH YEAR. IF  THE  AMOUNT  OF
   52  THE CREDIT IS AT LEAST FIVE MILLION DOLLARS, THE CREDIT SHALL BE CLAIMED
   53  OVER  A  THREE  YEAR PERIOD BEGINNING IN THE FIRST TAXABLE YEAR IN WHICH
   54  THE CREDIT MAY BE CLAIMED AND IN THE NEXT TWO SUCCEEDING TAXABLE  YEARS,
   55  WITH ONE-THIRD OF THE AMOUNT OF THE CREDIT ALLOWED BEING CLAIMED IN EACH
   56  YEAR.
       S. 2609--A                         12                         A. 3009--A
    1    S 6. Section 3 of part Y-1 of chapter 57 of the laws of 2009, amending
    2  the  tax  law  relating  to  the empire state film production credit, is
    3  amended to read as follows:
    4    S  3. A. The governor's office of motion picture and television devel-
    5  opment shall file a report on a quarterly basis with the director of the
    6  division of the budget and the chairmen of the assembly ways  and  means
    7  committee and senate finance committee. The report shall be filed within
    8  fifteen  days  after the close of the calendar quarter. The first report
    9  shall cover the calendar quarter that begins April 1, 2009.  The  report
   10  must contain the following information for the calendar quarter:
   11    (1)  the total dollar amount of credits allocated during each month of
   12  the calendar quarter, broken down by month;
   13    (2) the number of film projects which have been allocated tax  credits
   14  of less than $1 million per project and the total dollar amount of cred-
   15  its allocated to those projects;
   16    (3)  the number of film projects which have been allocated tax credits
   17  of $1 million or more but less than $5 million per project and the total
   18  dollar amount of credits allocated to those projects;
   19    (4) the number of film projects which have been allocated tax  credits
   20  of $5 million or more per project and the total dollar amount of credits
   21  allocated to those projects; [and]
   22    (5)  a list of each film project which has been allocated a tax credit
   23  and  for  each  of  those projects (a) the estimated number of employees
   24  associated with the project, (b) the estimated qualified costs  for  the
   25  project, [and] (c) the estimated total costs of the project, AND (D) THE
   26  CREDIT-ELIGIBLE MAN HOURS FOR EACH PROJECT; AND
   27    (6)(A)  THE  NAME  OF  EACH  TAXPAYER  ALLOCATED A TAX CREDIT FOR EACH
   28  PROJECT; PROVIDED HOWEVER, IF THE TAXPAYER CLAIMS A TAX  CREDIT  BECAUSE
   29  THE  TAXPAYER IS A MEMBER OF A LIMITED LIABILITY COMPANY, A PARTNER IN A
   30  PARTNERSHIP OR A SHAREHOLDER IN A SUBCHAPTER S CORPORATION, THE NAME  OF
   31  EACH  LIMITED LIABILITY COMPANY, PARTNERSHIP OR SUBCHAPTER S CORPORATION
   32  EARNING ANY OF THOSE TAX CREDITS MUST BE INCLUDED IN THE REPORT  INSTEAD
   33  OF  INFORMATION  ABOUT  THE  TAXPAYER  CLAIMING  THE TAX CREDIT, (B) THE
   34  AMOUNT OF TAX CREDIT ALLOCATED TO EACH TAXPAYER;  PROVIDED  HOWEVER,  IF
   35  THE  TAXPAYER  CLAIMS A TAX CREDIT BECAUSE THE TAXPAYER IS A MEMBER OF A
   36  LIMITED LIABILITY COMPANY, A PARTNER IN A PARTNERSHIP OR  A  SHAREHOLDER
   37  IN  A  SUBCHAPTER S CORPORATION, THE AMOUNT OF TAX CREDIT EARNED BY EACH
   38  ENTITY MUST BE INCLUDED IN THE REPORT INSTEAD OF INFORMATION  ABOUT  THE
   39  TAXPAYER  CLAIMING  THE  TAX CREDIT, AND (C) INFORMATION IDENTIFYING THE
   40  PROJECT ASSOCIATED WITH EACH TAXPAYER FOR WHICH A TAX CREDIT WAS CLAIMED
   41  UNDER SECTION 24 OR SECTION 31, AS ADDED BY CHAPTER 57 OF  THE  LAWS  OF
   42  2010, OF THE TAX LAW, INCLUDING THE NAME OF THE FILM AND COUNTY IN WHICH
   43  THE PROJECT IS LOCATED; AND
   44    B.  THE GOVERNOR'S OFFICE OF MOTION PICTURE AND TELEVISION DEVELOPMENT
   45  SHALL FILE A REPORT ON A BIENNIAL BASIS WITH THE DIRECTOR OF  THE  DIVI-
   46  SION OF THE BUDGET AND THE CHAIRS OF THE ASSEMBLY WAYS AND MEANS COMMIT-
   47  TEE  AND  SENATE  FINANCE  COMMITTEE.  THE  REPORT SHALL BE FILED WITHIN
   48  FIFTEEN DAYS AFTER THE CLOSE OF THE  CALENDAR  YEAR.  THE  FIRST  REPORT
   49  SHALL COVER A TWO YEAR PERIOD THAT BEGINS ON JANUARY FIRST, TWO THOUSAND
   50  THIRTEEN.  THE  REPORT  MUST  BE  PREPARED BY AN INDEPENDENT THIRD PARTY
   51  AUDITOR AND INCLUDE: (1) INFORMATION REGARDING  THE  EMPIRE  STATE  FILM
   52  PRODUCTION  CREDIT  AND  POST  PRODUCTION  CREDIT PROGRAMS INCLUDING THE
   53  EFFICIENCY OF OPERATIONS, RELIABILITY OF FINANCIAL REPORTING, COMPLIANCE
   54  WITH LAWS AND REGULATIONS AND DISTRIBUTION OF ASSETS AND FUNDS;  (2)  AN
   55  ECONOMIC IMPACT STUDY PREPARED BY AN INDEPENDENT THIRD PARTY OF THE FILM
   56  CREDIT  PROGRAMS; AND (3) ANY OTHER INFORMATION AND/OR OTHER STATISTICAL
       S. 2609--A                         13                         A. 3009--A
    1  INFORMATION THAT THE COMMISSIONER OF ECONOMIC DEVELOPMENT  DEEMS  TO  BE
    2  USEFUL IN ANALYZING THE EFFECTS OF THE PROGRAM.
    3    S  7.  This act shall take effect immediately, provided, however, that
    4  sections four and five of this act shall apply to  taxpayers  submitting
    5  initial  applications  to  the  governor's  office of motion picture and
    6  television development on or after the date this act shall have become a
    7  law, and to taxpayers who filed an initial application before  this  act
    8  shall  have become a law but who have not yet submitted a final applica-
    9  tion to the governor's office of motion picture and television  develop-
   10  ment  on  or  before  the date this act shall have become a law; and the
   11  amendments made to section 3 of part Y-1 of chapter 57 of  the  laws  of
   12  2009,  amending the tax law relating to the empire state film production
   13  credit, with the exception of subdivision b of such section, shall  only
   14  apply  to  taxpayers  submitting  initial applications to the governor's
   15  office of motion picture and television development on or after the date
   16  this act shall become a law.
   17                                   PART C
   18    Section 1. Legislative intent. This act is intended to create a state-
   19  wide network of university affiliated or college affiliated and  private
   20  sector  affiliated  innovation  hot  spots  in New York state to support
   21  start-up companies and those in the  early  stage  of  development.  The
   22  mission  of  the  innovation hot spots shall be to promote job creation,
   23  entrepreneurship and technology transfer, as well as to provide  support
   24  services  to  hot  spot tenants, including, but not limited to, business
   25  planning,  management  assistance,  financial-packaging,   linkages   to
   26  financing  and  technology services, and coordination with other sources
   27  of assistance.
   28    S 2. The economic development law is amended by adding a  new  section
   29  361 to read as follows:
   30    S  361. NEW YORK INNOVATION HOT SPOT PROGRAM.  1. DEFINITIONS. AS USED
   31  IN THIS SECTION, THE FOLLOWING TERMS SHALL HAVE THE FOLLOWING MEANINGS:
   32    (A) "INNOVATION HOT SPOT" SHALL MEAN A FACILITY OR  FACILITIES  DESIG-
   33  NATED AS SUCH BY THE COMMISSIONER.
   34    (B) "QUALIFIED ENTITY" SHALL MEAN A BUSINESS ENTERPRISE THAT IS:
   35    (I) IN THE FORMATIVE STAGE OF DEVELOPMENT;
   36    (II) LOCATED IN NEW YORK STATE;
   37    (III) EITHER: (A) ANY CORPORATION, EXCEPT A CORPORATION WHICH:
   38    (1)  OVER FIFTY PERCENT OF THE NUMBER OF SHARES OF STOCK ENTITLING THE
   39  HOLDERS THEREOF TO VOTE FOR THE ELECTION OF  DIRECTORS  OR  TRUSTEES  IS
   40  OWNED  OR  CONTROLLED,  EITHER  DIRECTLY  OR  INDIRECTLY,  BY A TAXPAYER
   41  SUBJECT TO TAX UNDER THE FOLLOWING PROVISIONS OF THE TAX LAW:    ARTICLE
   42  NINE-A; SECTION ONE HUNDRED EIGHTY-THREE, ONE HUNDRED EIGHTY-FOUR OR ONE
   43  HUNDRED EIGHTY-FIVE OF ARTICLE NINE; ARTICLE THIRTY-TWO OR ARTICLE THIR-
   44  TY-THREE; OR
   45    (2)  IS SUBSTANTIALLY SIMILAR IN OPERATION AND IN OWNERSHIP TO A BUSI-
   46  NESS ENTITY (OR  ENTITIES)  TAXABLE  OR  PREVIOUSLY  TAXABLE  UNDER  THE
   47  FOLLOWING PROVISIONS OF THE TAX LAW: ARTICLE NINE-A; SECTION ONE HUNDRED
   48  EIGHTY-THREE, ONE HUNDRED EIGHTY-FOUR, ONE HUNDRED EIGHTY-FIVE OR FORMER
   49  SECTION  ONE  HUNDRED  EIGHTY-SIX  OF  ARTICLE NINE; ARTICLE THIRTY-TWO;
   50  ARTICLE THIRTY-THREE; ARTICLE TWENTY-THREE, OR WOULD HAVE  BEEN  SUBJECT
   51  TO TAX UNDER SUCH ARTICLE TWENTY-THREE (AS SUCH ARTICLE WAS IN EFFECT ON
   52  JANUARY  FIRST,  NINETEEN  HUNDRED  EIGHTY) OR THE INCOME (OR LOSSES) OF
   53  WHICH IS (OR WAS) INCLUDABLE UNDER ARTICLE TWENTY-TWO; OR
       S. 2609--A                         14                         A. 3009--A
    1    (B) A SOLE PROPRIETORSHIP, PARTNERSHIP, LIMITED LIABILITY COMPANY,  OR
    2  NEW  YORK  SUBCHAPTER S CORPORATION THAT IS NOT SUBSTANTIALLY SIMILAR IN
    3  OPERATION AND IN OWNERSHIP TO A BUSINESS ENTITY (OR  ENTITIES)  TAXABLE,
    4  OR  PREVIOUSLY TAXABLE, UNDER ARTICLE NINE-A OF THE TAX LAW, SECTION ONE
    5  HUNDRED  EIGHTY-THREE,  ONE HUNDRED EIGHTY-FOUR, ONE HUNDRED EIGHTY-FIVE
    6  OR FORMER SECTION ONE HUNDRED EIGHTY-SIX OF ARTICLE NINE OF THE TAX LAW,
    7  ARTICLE THIRTY-TWO OR THIRTY-THREE OF THE TAX LAW, ARTICLE  TWENTY-THREE
    8  OF  THE TAX LAW OR WHICH WOULD HAVE BEEN SUBJECT TO TAX UNDER SUCH ARTI-
    9  CLE TWENTY-THREE (AS SUCH ARTICLE WAS IN EFFECT ON JANUARY FIRST,  NINE-
   10  TEEN  HUNDRED  EIGHTY)  OR  THE  INCOME (OR LOSSES) OF WHICH IS (OR WAS)
   11  INCLUDABLE UNDER ARTICLE TWENTY-TWO OF THE TAX LAW; AND
   12    (IV) IS APPROVED TO LOCATE IN AN INNOVATION HOT SPOT BY  THE  OPERATOR
   13  OF SUCH INNOVATION HOT SPOT.
   14    (C) "OPERATOR OF AN INNOVATION HOT SPOT" SHALL MEAN:
   15    (I)  AN  ACCREDITED POST-SECONDARY EDUCATIONAL INSTITUTION, COLLEGE OR
   16  UNIVERSITY; NOT-FOR-PROFIT ENTITY AFFILIATED WITH A  HIGHER  EDUCATIONAL
   17  INSTITUTION; OR, COLLABORATIVE ENTERPRISE BETWEEN ONE OR MORE ACCREDITED
   18  POST-SECONDARY   EDUCATIONAL  INSTITUTION,  COLLEGE  OR  UNIVERSITY  AND
   19  NOT-FOR-PROFIT ENTITY AFFILIATED WITH A HIGHER EDUCATIONAL INSTITUTION;
   20    (II) LOCATED IN NEW YORK STATE; AND
   21    (III) DESIGNATED BY  THE  COMMISSIONER  TO  OPERATE  A  FACILITY  THAT
   22  PROVIDES:   LOW-COST  SPACE;  TECHNICAL  ASSISTANCE;  SUPPORT  SERVICES,
   23  INCLUDING, BUT NOT LIMITED TO, CENTRAL SERVICES; AND, EDUCATIONAL OPPOR-
   24  TUNITIES, TO A "QUALIFIED ENTITY."
   25    2. THE COMMISSIONER SHALL:
   26    (A) SOLICIT APPLICATIONS FROM POST-SECONDARY EDUCATIONAL INSTITUTIONS,
   27  COLLEGES, UNIVERSITIES, OR NOT-FOR-PROFIT  ENTITIES  AFFILIATED  WITH  A
   28  HIGHER EDUCATION INSTITUTION OR COLLABORATIVE ENTERPRISES BETWEEN ONE OR
   29  MORE  ACCREDITED  POST-SECONDARY  EDUCATIONAL INSTITUTIONS, COLLEGES, OR
   30  UNIVERSITIES AND NOT-FOR-PROFIT ENTITIES FOR APPROVAL TO  OPERATE  INNO-
   31  VATION HOT SPOTS IN PROPERTY OWNED OR LEASED BY SUCH ENTITIES TO ATTRACT
   32  INDUSTRIES  WITH  SIGNIFICANT POTENTIAL FOR ECONOMIC GROWTH AND DEVELOP-
   33  MENT IN NEW YORK  STATE,  AND  IDENTIFY  TECHNOLOGICAL  AREAS  THAT  CAN
   34  CONTRIBUTE  TO  THE  GROWTH OF VARIOUS INDUSTRIES LOCATED THROUGHOUT NEW
   35  YORK STATE;
   36    (B) RECEIVE RECOMMENDATIONS FROM  THE  REGIONAL  ECONOMIC  DEVELOPMENT
   37  COUNCILS REGARDING THE APPROVAL OR REJECTION OF THE APPLICANTS AS OPERA-
   38  TORS OF INNOVATION HOT SPOTS.
   39    3. THE COMMISSIONER SHALL ESTABLISH CRITERIA CONCERNING THE INNOVATION
   40  HOT  SPOT PROGRAM.   (A) THE CRITERIA THAT APPLICANTS MUST SATISFY TO BE
   41  DESIGNATED AS AN OPERATOR OF AN INNOVATION HOT SPOT INCLUDE, BUT ARE NOT
   42  LIMITED TO, THE FOLLOWING:
   43    (I) A RECORD OF, OR PLAN TO CONFORM TO, BEST PRACTICES INCLUDING,  BUT
   44  NOT  LIMITED  TO,  CLEAR POLICIES FOR THE RESIDENT BUSINESS ENTITIES AND
   45  GRADUATION FROM THE SPACE;
   46    (II) A COMPREHENSIVE  SUITE  OF  ENTREPRENEURIAL  MENTORING  PRACTICES
   47  INCLUDING, BUT NOT LIMITED TO, ADVISING, COACHING, PLANNING AND CONNECT-
   48  ING TO FUNDING AND TECHNOLOGY SOURCES;
   49    (III)  THE  CAPACITY TO SECURE SUBSTANTIAL PRIVATE AND OTHER NON-STATE
   50  GOVERNMENTAL FUNDING FOR THE PROPOSED INNOVATION HOT SPOT,  IN  ADDITION
   51  TO  DIRECT  SUPPORT  FROM THE SPONSORING ACADEMIC INSTITUTION OR RELATED
   52  FOUNDATION;
   53    (IV) THE ABILITY  AND  WILLINGNESS  TO  COOPERATE  WITH  OTHER  LOCAL,
   54  REGIONAL  AND  STATEWIDE  ECONOMIC  DEVELOPMENT  ORGANIZATIONS, BUSINESS
   55  SUPPORT NETWORKS, VENTURE AND ANGEL CAPITAL FUNDING SOURCES,  AND  WORK-
   56  FORCE DEVELOPMENT ADVOCATES;
       S. 2609--A                         15                         A. 3009--A
    1    (V)  THE  CAPACITY TO COLLABORATE WITH OTHER BUSINESSES AND INDUSTRIES
    2  INDIVIDUALLY; AND
    3    (VI)  SUCH  OTHER REQUIREMENTS AS THE DEPARTMENT DEEMS APPROPRIATE FOR
    4  THE FORMAT, CONTENT AND FILING OF APPLICATIONS FOR DESIGNATION AS  INNO-
    5  VATION HOT SPOTS.
    6    (B) THE COMMISSIONER SHALL ALSO ESTABLISH CRITERIA FOR THE DESIGNATION
    7  OF INNOVATION HOT SPOTS.
    8    (C)  AFTER  ESTABLISHING SUCH CRITERIA, THE COMMISSIONER SHALL APPROVE
    9  AND DESIGNATE FIVE INNOVATION HOT SPOTS AND THEIR  OPERATORS  IN  FISCAL
   10  YEAR  TWO  THOUSAND  THIRTEEN--TWO THOUSAND FOURTEEN AND FIVE ADDITIONAL
   11  INNOVATION HOT SPOTS AND THEIR OPERATORS IN  FISCAL  YEAR  TWO  THOUSAND
   12  FOURTEEN--TWO THOUSAND FIFTEEN.
   13    (D)  THE  COMMISSIONER  SHALL ISSUE A CERTIFICATE OF APPROVAL FOR EACH
   14  DESIGNATED INNOVATION HOT SPOT AND EACH APPROVED OPERATOR  OF  AN  INNO-
   15  VATION HOT SPOT.
   16    (E)  THE OPERATOR OF AN APPROVED INNOVATION HOT SPOT MAY ACCEPT APPLI-
   17  CATIONS FOR TENANCIES FROM QUALIFIED ENTITIES FOR A PERIOD OF FIVE YEARS
   18  AFTER THE RECEIPT BY SUCH INNOVATION HOT  SPOT  OF  ITS  CERTIFICATE  OF
   19  APPROVAL  FROM  THE  COMMISSIONER.  QUALIFIED ENTITIES THAT LOCATE THEIR
   20  BUSINESSES IN AN INNOVATION HOT SPOT ARE ELIGIBLE TO RECEIVE  TAX  BENE-
   21  FITS  UNDER  SECTION THIRTY-EIGHT OF THE TAX LAW FOR FIVE TAXABLE YEARS,
   22  BEGINNING WITH THE FIRST TAXABLE YEAR DURING WHICH SUCH QUALIFIED  ENTI-
   23  TIES BECOME TENANTS IN AN INNOVATION HOT SPOT.
   24    4.  EACH  OPERATOR OF AN INNOVATION HOT SPOT SHALL REPORT ON AN ANNUAL
   25  BASIS ON ITS ACTIVITIES TO THE COMMISSIONER IN A MANNER AND ACCORDING TO
   26  THE SCHEDULE ESTABLISHED BY THE DEPARTMENT, AND SHALL PROVIDE SUCH ADDI-
   27  TIONAL INFORMATION AS THE COMMISSIONER  MAY  REQUIRE.  THE  COMMISSIONER
   28  SHALL  EVALUATE THE OPERATIONS OF THE INNOVATION HOT SPOTS USING METHODS
   29  INCLUDING BUT NOT LIMITED TO SITE VISITS, REPORTS PURSUANT TO  SPECIFIED
   30  INFORMATION,  AND REVIEW EVALUATIONS. IF THE COMMISSIONER IS UNSATISFIED
   31  WITH THE PROGRESS OF AN OPERATOR OF AN INNOVATION HOT SPOT, THE  COMMIS-
   32  SIONER  SHALL NOTIFY SUCH OPERATOR OF THE RESULTS OF ITS EVALUATIONS AND
   33  THE FINDINGS OF DEFICIENCIES IN THE OPERATION OF SUCH HOT SPOT AND SHALL
   34  ALLOW AND COOPERATE WITH SUCH OPERATOR TO  REMEDY  SUCH  FINDINGS  IN  A
   35  TIMELY MANNER.
   36    5.  NOTWITHSTANDING ANY PROVISION OF THIS CHAPTER, EMPLOYEES AND OFFI-
   37  CERS OF THE DEPARTMENT AND THE DEPARTMENT OF TAXATION AND FINANCE  SHALL
   38  BE ALLOWED AND ARE DIRECTED TO SHARE AND EXCHANGE:
   39    (I)  INFORMATION  DERIVED FROM TAX RETURNS OR REPORTS THAT IS RELEVANT
   40  TO A QUALIFIED ENTITY'S ELIGIBILITY TO PARTICIPATE IN THE INNOVATION HOT
   41  SPOTS PROGRAM, AND
   42    (II) INFORMATION REGARDING THE TAX BENEFITS APPLIED FOR,  ALLOWED,  OR
   43  CLAIMED  PURSUANT TO SECTION THIRTY-EIGHT OF THE TAX LAW AND THE TAXPAY-
   44  ERS WHO ARE APPLYING FOR OR ARE CLAIMING THE TAX BENEFITS.
   45    ALL INFORMATION EXCHANGED BETWEEN THE DEPARTMENT AND THE DEPARTMENT OF
   46  TAXATION AND FINANCE SHALL  NOT BE SUBJECT TO DISCLOSURE  OR  INSPECTION
   47  PURSUANT  TO  THE  STATE'S  FREEDOM OF INFORMATION LAW.   THE DEPARTMENT
   48  SHALL NOT DISCLOSE ANY INFORMATION OBTAINED FROM THE DEPARTMENT OF TAXA-
   49  TION AND FINANCE THAT CONCERNS SPECIFIC TAXPAYERS.
   50    S 3. The tax law is amended by adding a new  section  38  to  read  as
   51  follows:
   52    S  38.  NEW YORK INNOVATION HOT SPOT PROGRAM TAX BENEFITS. (A) AS USED
   53  IN THIS CHAPTER, THE TERMS "INNOVATION HOT SPOT" AND "QUALIFIED  ENTITY"
   54  SHALL  HAVE THE SAME MEANING AS UNDER SECTION THREE HUNDRED SIXTY-ONE OF
   55  THE ECONOMIC DEVELOPMENT LAW.
       S. 2609--A                         16                         A. 3009--A
    1    (B) A TAXPAYER UNDER ARTICLE NINE-A OF THIS CHAPTER THAT IS  A  QUALI-
    2  FIED ENTITY AND ALSO A TENANT IN AN INNOVATION HOT SPOT SHALL BE SUBJECT
    3  ONLY  TO  THE  FIXED  DOLLAR MINIMUM TAX, IMPOSED UNDER PARAGRAPH (D) OF
    4  SUBDIVISION ONE OF SECTION TWO HUNDRED TEN OF  THIS  CHAPTER,  FOR  FIVE
    5  TAXABLE  YEARS,  BEGINNING  WITH THE FIRST TAXABLE YEAR DURING WHICH THE
    6  QUALIFIED ENTITY BECOMES A TENANT IN AN INNOVATION HOT SPOT. A  TAXPAYER
    7  UNDER  ARTICLE  NINE-A  OF THIS CHAPTER THAT IS A CORPORATE PARTNER IN A
    8  QUALIFIED ENTITY, OR IS A QUALIFIED ENTITY THAT IS LOCATED  BOTH  WITHIN
    9  AND  WITHOUT  AN  INNOVATION HOT SPOT, SHALL BE ALLOWED ONLY A DEDUCTION
   10  FOR THE AMOUNT OF INCOME OR GAIN INCLUDED IN ITS FEDERAL TAXABLE  INCOME
   11  TO  THE EXTENT THAT THE INCOME OR GAIN IS ATTRIBUTABLE TO THE OPERATIONS
   12  AT THE INNOVATION HOT SPOT. THE DEDUCTION IS ALLOWED  FOR  FIVE  TAXABLE
   13  YEARS,  BEGINNING WITH THE FIRST TAXABLE YEAR DURING WHICH THE QUALIFIED
   14  ENTITY BECOMES A TENANT IN AN INNOVATION HOT SPOT.
   15    (C) AN INDIVIDUAL WHO IS THE SOLE PROPRIETOR OF A QUALIFIED ENTITY  OR
   16  A MEMBER OF A LIMITED LIABILITY COMPANY, A PARTNER IN A PARTNERSHIP OR A
   17  SHAREHOLDER  IN  A  NEW  YORK SUBCHAPTER S CORPORATION WHERE THE LIMITED
   18  LIABILITY COMPANY, PARTNERSHIP, OR S CORPORATION IS A QUALIFIED  ENTITY,
   19  THAT  IS  TAXABLE  UNDER  ARTICLE  TWENTY-TWO  OF  THIS CHAPTER SHALL BE
   20  ALLOWED A DEDUCTION FOR THE AMOUNT OF INCOME OR  GAIN  INCLUDED  IN  ITS
   21  FEDERAL  ADJUSTED  GROSS INCOME TO THE EXTENT THAT THE INCOME OR GAIN IS
   22  ATTRIBUTABLE TO THE OPERATIONS OF A QUALIFIED ENTITY WHICH IS  A  TENANT
   23  IN  AN  INNOVATION  HOT  SPOT. THE DEDUCTION IS ALLOWED FOR FIVE TAXABLE
   24  YEARS, BEGINNING WITH THE FIRST TAXABLE YEAR DURING WHICH THE  QUALIFIED
   25  ENTITY BECOMES A TENANT IN AN INNOVATION HOT SPOT.
   26    (D)  A  QUALIFIED  ENTITY  THAT  IS A TENANT IN AN INNOVATION HOT SPOT
   27  SHALL BE ELIGIBLE FOR A CREDIT OR REFUND FOR SALES AND USE TAXES IMPOSED
   28  ON THE RETAIL SALE OF  TANGIBLE  PERSONAL  PROPERTY  OR  SERVICES  UNDER
   29  SUBDIVISIONS  (A),  (B),  AND  (C)  OF  SECTION  ELEVEN HUNDRED FIVE AND
   30  SECTION ELEVEN HUNDRED TEN OF THIS CHAPTER. THE CREDIT OR  REFUND  SHALL
   31  BE  ALLOWED  FOR  SIXTY MONTHS BEGINNING WITH THE FIRST FULL MONTH AFTER
   32  THE QUALIFIED ENTITY BECOMES A TENANT IN AN INNOVATION HOT SPOT.
   33    (E) A TAXPAYER WHO CLAIMS ANY OF THE TAX BENEFITS  DESCRIBED  IN  THIS
   34  SECTION  IS  NO LONGER ELIGIBLE FOR ANY OTHER NEW YORK STATE EXEMPTIONS,
   35  DEDUCTIONS, OR CREDIT OR REFUNDS UNDER THIS CHAPTER TO THE  EXTENT  THAT
   36  ANY  SUCH  EXEMPTION, DEDUCTION, CREDIT OR REFUND IS ATTRIBUTABLE TO THE
   37  BUSINESS OPERATIONS OF A TENANT IN AN INNOVATION HOT SPOT. THE  ELECTION
   38  TO CLAIM THE TAX BENEFITS DESCRIBED IN THIS SECTION IS NOT REVOCABLE.
   39    (F) CROSS-REFERENCES. FOR APPLICATION OF THE TAX BENEFITS PROVIDED FOR
   40  IN THIS SECTION, SEE THE FOLLOWING PROVISIONS OF THIS CHAPTER:
   41    (I) ARTICLE 9-A, SECTION 208, SUBDIVISION (9), PARAGRAPH (A), SUBPARA-
   42  GRAPH (18).
   43    (II) ARTICLE 9-A, SECTION 209, SUBDIVISION 11.
   44    (III) ARTICLE 22, SECTION 612, SUBSECTION (C), PARAGRAPH (39).
   45    (IV) ARTICLE 28, SECTION 1119, SUBDIVISION (D).
   46    S  4.  Paragraph (a) of subdivision 9 of section 208 of the tax law is
   47  amended by adding a new subparagraph 18 to read as follows:
   48    (18) THE AMOUNT OF INCOME OR GAIN INCLUDED IN FEDERAL  TAXABLE  INCOME
   49  OF  A TAXPAYER THAT IS A PARTNER IN A QUALIFIED ENTITY OR IS A QUALIFIED
   50  ENTITY THAT IS LOCATED BOTH WITHIN AND WITHOUT AN INNOVATION  HOT  SPOT,
   51  TO  THE EXTENT THAT THE INCOME OR GAIN IS ATTRIBUTABLE TO THE OPERATIONS
   52  OF A QUALIFIED ENTITY AT THE INNOVATION HOT SPOT AS PROVIDED IN  SECTION
   53  THIRTY-EIGHT OF THIS CHAPTER.
   54    S 5. Section 209 of the tax law is amended by adding a new subdivision
   55  11 to read as follows:
       S. 2609--A                         17                         A. 3009--A
    1    11.  EXCEPT  AS  PROVIDED IN SUBPARAGRAPH EIGHTEEN OF PARAGRAPH (A) OF
    2  SUBDIVISION NINE OF SECTION TWO HUNDRED EIGHT OF THIS ARTICLE, A  CORPO-
    3  RATION THAT IS A QUALIFIED ENTITY AND ALSO A TENANT IN AN INNOVATION HOT
    4  SPOT  SHALL  BE SUBJECT ONLY TO THE FIXED DOLLAR MINIMUM TAX UNDER PARA-
    5  GRAPH (D) OF SUBDIVISION ONE OF SECTION TWO HUNDRED TEN OF THIS ARTICLE,
    6  AS PROVIDED IN SECTION THIRTY-EIGHT OF THIS CHAPTER.
    7    S 6. Subsection (c) of section 612 of the tax law is amended by adding
    8  a new paragraph 39 to read as follows:
    9    (39)  ANY  INCOME  OR  GAIN,  TO  THE EXTENT IT IS INCLUDED IN FEDERAL
   10  ADJUSTED GROSS INCOME OF AN INDIVIDUAL WHO IS THE SOLE PROPRIETOR  OF  A
   11  QUALIFIED  ENTITY  OR A MEMBER OF A LIMITED LIABILITY COMPANY, A PARTNER
   12  IN A PARTNERSHIP OR A SHAREHOLDER IN A NEW YORK SUBCHAPTER S CORPORATION
   13  THAT IS A QUALIFIED ENTITY, ATTRIBUTABLE TO THE OPERATIONS OF  A  QUALI-
   14  FIED  ENTITY  AT  ITS LOCATION IN AN INNOVATION HOT SPOT, AS PROVIDED IN
   15  SECTION THIRTY-EIGHT OF THIS CHAPTER.
   16    S 7. Paragraph 1 of subdivision (d) of section 1119 of the tax law, as
   17  added by section 31 of part S-1 of chapter 57 of the laws  of  2009,  is
   18  amended to read as follows:
   19    (1)  Subject  to  the  conditions and limitations provided for in this
   20  section, a refund or credit will be allowed for  taxes  imposed  on  the
   21  retail  sale  of tangible personal property described in subdivision (a)
   22  of section eleven hundred five of this article, and  on  every  sale  of
   23  services  described  in  subdivisions  (b)  and (c) of such section, and
   24  consideration given or contracted to be given for, or for  the  use  of,
   25  such  tangible  personal  property  or  services,  where  such  tangible
   26  personal property or services are sold to a qualified empire zone enter-
   27  prise OR TO A QUALIFIED ENTITY THAT IS ALSO A TENANT  IN  AN  INNOVATION
   28  HOT  SPOT  AS PROVIDED IN SECTION THIRTY-EIGHT OF THIS CHAPTER, provided
   29  that (A) such tangible personal property or tangible  personal  property
   30  upon which such a service has been performed or such service (other than
   31  a service described in subdivision (b) of section eleven hundred five of
   32  this article) is directly and predominantly, or such a service described
   33  in clause (A) or (D) of paragraph one of such subdivision (b) of section
   34  eleven hundred five of this article is directly and exclusively, used or
   35  consumed  by (I) such QUALIFIED EMPIRE ZONE enterprise in an area desig-
   36  nated as an empire zone pursuant to article eighteen-B  of  the  general
   37  municipal  law with respect to which such enterprise is certified pursu-
   38  ant to such article eighteen-B, OR (II)  SUCH  QUALIFIED  ENTITY  IN  AN
   39  INNOVATION HOT SPOT or (B) such a service described in clause (B) or (C)
   40  of  paragraph  one  of subdivision (b) of section eleven hundred five of
   41  this article is delivered and  billed  to  (I)  such  enterprise  at  an
   42  address in such empire zone OR (II) SUCH QUALIFIED ENTITY AT THE ADDRESS
   43  OF THE INNOVATION HOT SPOT WHERE IT IS A TENANT, or (C) the enterprise's
   44  place  of  primary use of the service described in paragraph two of such
   45  subdivision (b) of section eleven hundred five is at an address in  such
   46  empire  zone  OR  AT AN INNOVATION HOT SPOT; provided, further, that, in
   47  order for a motor vehicle, as defined  in  subdivision  (c)  of  section
   48  eleven  hundred seventeen of this article, or tangible personal property
   49  related to such a motor vehicle to be found to be used predominantly  in
   50  such a zone, at least fifty percent of such motor vehicle's use shall be
   51  exclusively  within  such  zone  or at least fifty percent of such motor
   52  vehicle's use shall be in activities originating or terminating in  such
   53  zone,  or  both; and either or both such usages shall be computed either
   54  on the basis of mileage or hours of  use,  at  the  discretion  of  such
   55  enterprise. For purposes of this subdivision, tangible personal property
   56  related  to  such  a motor vehicle shall include a battery, diesel motor
       S. 2609--A                         18                         A. 3009--A
    1  fuel, an engine, engine components, motor fuel,  a  muffler,  tires  and
    2  similar tangible personal property used in or on such a motor vehicle.
    3    S  8. Subdivision (c) of section 11-1712 of the administrative code of
    4  the city of New York is amended by adding a new paragraph 35 to read  as
    5  follows:
    6    (35) AS PROVIDED IN SECTION THIRTY-EIGHT OF THE TAX LAW, ANY INCOME OR
    7  GAIN,  TO  THE EXTENT IT IS INCLUDED IN FEDERAL ADJUSTED GROSS INCOME OF
    8  AN INDIVIDUAL WHO IS THE SOLE PROPRIETOR OF  A  QUALIFIED  ENTITY  OR  A
    9  MEMBER  OF  A LIMITED LIABILITY COMPANY, A PARTNER IN A PARTNERSHIP OR A
   10  SHAREHOLDER IN A NEW YORK SUBCHAPTER S CORPORATION THAT IS  A  QUALIFIED
   11  ENTITY  AS  DEFINED IN PARAGRAPH (B) OF SUBDIVISION ONE OF SECTION THREE
   12  HUNDRED SIXTY-ONE OF THE ECONOMIC DEVELOPMENT LAW, ATTRIBUTABLE  TO  THE
   13  OPERATIONS OF SUCH QUALIFIED ENTITY AT ITS LOCATION IN AN INNOVATION HOT
   14  SPOT,  AS  DEFINED  IN PARAGRAPH (A) OF SUBDIVISION ONE OF SECTION THREE
   15  HUNDRED SIXTY-ONE OF THE ECONOMIC DEVELOPMENT LAW.
   16    S 9. This act shall take effect immediately.
   17                                   PART D
   18    Section 1. Subsection (g) of section 615 of the tax law, as  added  by
   19  section  3  of  part HH of chapter 57 of the laws of 2010, is amended to
   20  read as follows:
   21    (g)(1) With respect to an individual whose  New  York  adjusted  gross
   22  income is over one million dollars and no more than ten million dollars,
   23  the  New  York  itemized  deduction  shall  be  an amount equal to fifty
   24  percent of any charitable contribution deduction allowed  under  section
   25  one  hundred  seventy  of  the  internal  revenue code for taxable years
   26  beginning after two thousand nine and  before  two  thousand  [thirteen]
   27  SIXTEEN.  With  respect  to  an individual whose New York adjusted gross
   28  income is over one million dollars,  the  New  York  itemized  deduction
   29  shall be an amount equal to fifty percent of any charitable contribution
   30  deduction  allowed  under  section  one  hundred seventy of the internal
   31  revenue code for taxable years beginning in two thousand nine  or  after
   32  two thousand [twelve] FIFTEEN.
   33    (2) With respect to an individual whose New York adjusted gross income
   34  is over ten million dollars, the New York itemized deduction shall be an
   35  amount  equal  to  twenty-five  percent  of  any charitable contribution
   36  deduction allowed under section one  hundred  seventy  of  the  internal
   37  revenue  code  for  taxable  years beginning after two thousand nine and
   38  ending before two thousand [thirteen] SIXTEEN.
   39    S 2. Subdivision (g) of section 11-1715 of the administrative code  of
   40  the  city of New York, as added by section 7 of part HH of chapter 57 of
   41  the laws of 2010, is amended to read as follows:
   42    (g) (1) With respect to an individual whose New  York  adjusted  gross
   43  income is over one million dollars but no more than ten million dollars,
   44  the  New  York  itemized  deduction  shall  be  an amount equal to fifty
   45  percent of any charitable contribution deduction allowed  under  section
   46  one  hundred  seventy  of  the  internal  revenue code for taxable years
   47  beginning after two thousand nine and  before  two  thousand  [thirteen]
   48  SIXTEEN.  With  respect  to  an individual whose New York adjusted gross
   49  income is over one million dollars,  the  New  York  itemized  deduction
   50  shall be an amount equal to fifty percent of any charitable contribution
   51  deduction  allowed  under  section  one  hundred seventy of the internal
   52  revenue code for taxable years beginning in two thousand nine  or  after
   53  two thousand [twelve] FIFTEEN.
       S. 2609--A                         19                         A. 3009--A
    1    (2) With respect to an individual whose New York adjusted gross income
    2  is over ten million dollars, the New York itemized deduction shall be an
    3  amount  equal  to  twenty-five  percent  of  any charitable contribution
    4  deduction allowed under section one  hundred  seventy  of  the  internal
    5  revenue  code  for  taxable  years beginning after two thousand nine AND
    6  ENDING BEFORE TWO THOUSAND SIXTEEN.
    7    S 3. This act shall take effect immediately.
    8                                   PART E
    9    Section 1. Subparagraph 17  of  paragraph  (a)  of  subdivision  9  of
   10  section 208 of the tax law is REPEALED.
   11    S  2. Paragraph (o) of subdivision 9 of section 208 of the tax law, as
   12  amended by section 1 of part M of chapter  686  of  the  laws  of  2003,
   13  clause  (A) of subparagraph 2 as amended by section 4 of part J of chap-
   14  ter 60 of the laws of 2007, is amended to read as follows:
   15    (o) Related members expense add back [and income exclusion]. (1) Defi-
   16  nitions. (A) Related member [or members. For purposes of this paragraph,
   17  the term related member or members means a person, corporation, or other
   18  entity, including an entity that is treated as a  partnership  or  other
   19  pass-through  vehicle  for  purposes  of  federal taxation, whether such
   20  person, corporation or entity is a  taxpayer  or  not,  where  one  such
   21  person,  corporation, or entity, or set of related persons, corporations
   22  or entities, directly or  indirectly  owns  or  controls  a  controlling
   23  interest  in  another  entity.  Such  entity or entities may include all
   24  taxpayers under articles nine, nine-A, thirteen, twenty-two, thirty-two,
   25  thirty-three or thirty-three-A of this chapter]. "RELATED MEMBER"  MEANS
   26  A  RELATED  PERSON  AS DEFINED IN SUBPARAGRAPH (C) OF PARAGRAPH THREE OF
   27  SUBSECTION (B) OF SECTION FOUR HUNDRED SIXTY-FIVE OF THE INTERNAL REVEN-
   28  UE CODE, EXCEPT THAT "FIFTY  PERCENT"  SHALL  BE  SUBSTITUTED  FOR  "TEN
   29  PERCENT".
   30    (B)  [Controlling  interest.  A controlling interest shall mean (i) in
   31  the case of a corporation, either thirty percent or more  of  the  total
   32  combined  voting  power  of all classes of stock of such corporation, or
   33  thirty percent or more of the capital, profits or beneficial interest in
   34  such voting stock of such corporation, and (ii) in the case of  a  part-
   35  nership,  association,  trust or other entity, thirty percent or more of
   36  the capital, profits or beneficial interest in such partnership, associ-
   37  ation, trust or other entity.] EFFECTIVE RATE OF TAX. "EFFECTIVE RATE OF
   38  TAX" MEANS, AS TO ANY STATE OR U.S.  POSSESSION, THE  MAXIMUM  STATUTORY
   39  RATE  OF  TAX  IMPOSED  BY  THE  STATE OR POSSESSION ON OR MEASURED BY A
   40  RELATED MEMBER'S NET INCOME MULTIPLIED BY THE APPORTIONMENT  PERCENTAGE,
   41  IF  ANY,  APPLICABLE TO THE RELATED MEMBER UNDER THE LAWS OF SAID JURIS-
   42  DICTION. FOR PURPOSES OF THIS DEFINITION, THE EFFECTIVE RATE OF  TAX  AS
   43  TO  ANY  STATE OR U.S. POSSESSION IS ZERO WHERE THE RELATED MEMBER'S NET
   44  INCOME TAX LIABILITY IN SAID JURISDICTION IS REPORTED ON A  COMBINED  OR
   45  CONSOLIDATED  RETURN  INCLUDING BOTH THE TAXPAYER AND THE RELATED MEMBER
   46  WHERE THE REPORTED TRANSACTIONS BETWEEN THE  TAXPAYER  AND  THE  RELATED
   47  MEMBER  ARE ELIMINATED OR OFFSET. ALSO, FOR PURPOSES OF THIS DEFINITION,
   48  WHEN COMPUTING THE EFFECTIVE RATE OF TAX FOR A JURISDICTION IN  WHICH  A
   49  RELATED MEMBER'S NET INCOME IS ELIMINATED OR OFFSET BY A CREDIT OR SIMI-
   50  LAR  ADJUSTMENT  THAT  IS DEPENDENT UPON THE RELATED MEMBER EITHER MAIN-
   51  TAINING OR MANAGING INTANGIBLE PROPERTY OR COLLECTING INTEREST INCOME IN
   52  THAT JURISDICTION, THE MAXIMUM STATUTORY RATE OF  TAX  IMPOSED  BY  SAID
   53  JURISDICTION  SHALL  BE  DECREASED  TO REFLECT THE STATUTORY RATE OF TAX
       S. 2609--A                         20                         A. 3009--A
    1  THAT APPLIES TO THE RELATED MEMBER AS EFFECTIVELY REDUCED BY SUCH CREDIT
    2  OR SIMILAR ADJUSTMENT.
    3    (C) Royalty payments. Royalty payments are payments directly connected
    4  to  the  acquisition,  use,  maintenance or management, ownership, sale,
    5  exchange, or any other disposition of licenses, trademarks,  copyrights,
    6  trade  names,  trade  dress,  service  marks, mask works, trade secrets,
    7  patents and any other similar types of intangible assets  as  determined
    8  by  the commissioner, and [includes] INCLUDE amounts allowable as inter-
    9  est deductions under section one hundred  sixty-three  of  the  internal
   10  revenue  code to the extent such amounts are directly or indirectly for,
   11  related to or in connection with the acquisition,  use,  maintenance  or
   12  management,  ownership, sale, exchange or disposition of such intangible
   13  assets.
   14    (D) Valid Business Purpose. A valid business purpose is  one  or  more
   15  business  purposes,  other  than the avoidance or reduction of taxation,
   16  which alone or in combination constitute the primary motivation for some
   17  business activity or transaction, which activity or transaction  changes
   18  in  a  meaningful  way, apart from tax effects, the economic position of
   19  the taxpayer. The economic position of the taxpayer includes an increase
   20  in the market share of the taxpayer, or the entry by the  taxpayer  into
   21  new business markets.
   22    (2) Royalty expense add backs. (A) Except where a taxpayer is included
   23  in  a combined report with a related member pursuant to subdivision four
   24  of section two hundred eleven  of  this  article,  for  the  purpose  of
   25  computing entire net income or other applicable taxable basis, a taxpay-
   26  er  must  add  back royalty payments [to a] DIRECTLY OR INDIRECTLY PAID,
   27  ACCRUED, OR INCURRED IN CONNECTION WITH ONE OR MORE DIRECT  OR  INDIRECT
   28  TRANSACTIONS  WITH ONE OR MORE related [member] MEMBERS during the taxa-
   29  ble year to the extent deductible in calculating federal taxable income.
   30    (B) [The add back of royalty payments shall not be required if and  to
   31  the extent that such payments meet either of the following conditions:
   32    (i)  the related member during the same taxable year directly or indi-
   33  rectly paid or incurred the amount to a person or entity that is  not  a
   34  related  member,  and  such  transaction  was  done for a valid business
   35  purpose and the payments are made at arm's length;
   36    (ii) the royalty payments are paid or incurred  to  a  related  member
   37  organized  under the laws of a country other than the United States, are
   38  subject to a comprehensive income tax treaty between  such  country  and
   39  the  United States, and are taxed in such country at a tax rate at least
   40  equal to that imposed by this state.
   41    (3) Royalty income exclusions. For the purpose of computing entire net
   42  income or other taxable basis, a taxpayer shall  be  allowed  to  deduct
   43  royalty  payments  directly or indirectly received from a related member
   44  during the taxable year to the extent included in the taxpayer's federal
   45  taxable income unless such royalty payments would not be required to  be
   46  added  back  under  subparagraph  two of this paragraph or other similar
   47  provision in this chapter.] EXCEPTIONS. (I) THE ADJUSTMENT  REQUIRED  IN
   48  THIS  PARAGRAPH  SHALL  NOT  APPLY TO THE PORTION OF THE ROYALTY PAYMENT
   49  THAT THE TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE  OF  THE
   50  TYPE  AND  IN  THE  FORM SPECIFIED BY THE COMMISSIONER, MEETS ALL OF THE
   51  FOLLOWING REQUIREMENTS: (I) THE RELATED MEMBER WAS  SUBJECT  TO  TAX  IN
   52  THIS  STATE  OR  ANOTHER  STATE  OR POSSESSION OF THE UNITED STATES OR A
   53  FOREIGN NATION OR SOME COMBINATION THEREOF ON A TAX BASE  THAT  INCLUDED
   54  THE  ROYALTY PAYMENT PAID, ACCRUED OR INCURRED BY THE TAXPAYER; (II) THE
   55  RELATED MEMBER DURING THE SAME TAXABLE YEAR DIRECTLY OR INDIRECTLY PAID,
   56  ACCRUED OR INCURRED SUCH PORTION TO A  PERSON  THAT  IS  NOT  A  RELATED
       S. 2609--A                         21                         A. 3009--A
    1  MEMBER;  AND  (III)  THE  TRANSACTION GIVING RISE TO THE ROYALTY PAYMENT
    2  BETWEEN THE TAXPAYER AND THE RELATED MEMBER WAS UNDERTAKEN FOR  A  VALID
    3  BUSINESS PURPOSE.
    4    (II)  THE ADJUSTMENT REQUIRED IN THIS PARAGRAPH SHALL NOT APPLY IF THE
    5  TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE OF THE  TYPE  AND
    6  IN  THE FORM SPECIFIED BY THE COMMISSIONER, THAT: (I) THE RELATED MEMBER
    7  WAS SUBJECT TO TAX ON OR MEASURED BY ITS NET INCOME  IN  THIS  STATE  OR
    8  ANOTHER  STATE  OR  POSSESSION  OF THE UNITED STATES OR SOME COMBINATION
    9  THEREOF; (II) THE TAX BASE FOR SAID TAX  INCLUDED  THE  ROYALTY  PAYMENT
   10  PAID,  ACCRUED  OR  INCURRED  BY  THE  TAXPAYER; AND (III) THE AGGREGATE
   11  EFFECTIVE RATE OF TAX APPLIED TO THE RELATED MEMBER IN  THOSE  JURISDIC-
   12  TIONS  IS  NO LESS THAN EIGHTY PERCENT OF THE STATUTORY RATE OF TAX THAT
   13  APPLIED TO THE TAXPAYER UNDER SECTION TWO HUNDRED TEN  OF  THIS  ARTICLE
   14  FOR THE TAXABLE YEAR.
   15    (III) THE ADJUSTMENT REQUIRED IN THIS PARAGRAPH SHALL NOT APPLY IF THE
   16  TAXPAYER  ESTABLISHES,  BY CLEAR AND CONVINCING EVIDENCE OF THE TYPE AND
   17  IN THE FORM SPECIFIED BY THE COMMISSIONER, THAT: (I) THE ROYALTY PAYMENT
   18  WAS PAID, ACCRUED OR INCURRED TO A RELATED MEMBER  ORGANIZED  UNDER  THE
   19  LAWS  OF  A  COUNTRY  OTHER  THAN  THE  UNITED  STATES; (II) THE RELATED
   20  MEMBER'S INCOME FROM THE TRANSACTION  WAS  SUBJECT  TO  A  COMPREHENSIVE
   21  INCOME  TAX TREATY BETWEEN SUCH COUNTRY AND THE UNITED STATES; (III) THE
   22  RELATED MEMBER WAS SUBJECT TO TAX IN A FOREIGN NATION ON A TAX BASE THAT
   23  INCLUDED THE ROYALTY PAYMENT PAID, ACCRUED OR INCURRED BY THE  TAXPAYER;
   24  (IV)  THE RELATED MEMBER'S INCOME FROM THE TRANSACTION WAS TAXED IN SUCH
   25  COUNTRY AT AN EFFECTIVE RATE OF TAX AT LEAST EQUAL TO  THAT  IMPOSED  BY
   26  THIS  STATE;  AND  (V) THE ROYALTY PAYMENT WAS PAID, ACCRUED OR INCURRED
   27  PURSUANT TO A TRANSACTION THAT  WAS  UNDERTAKEN  FOR  A  VALID  BUSINESS
   28  PURPOSE AND USING TERMS THAT REFLECT AN ARM'S LENGTH RELATIONSHIP.
   29    (IV)  THE ADJUSTMENT REQUIRED IN THIS PARAGRAPH SHALL NOT APPLY IF THE
   30  TAXPAYER AND THE COMMISSIONER AGREE IN WRITING TO THE APPLICATION OR USE
   31  OF ALTERNATIVE ADJUSTMENTS OR COMPUTATIONS. THE COMMISSIONER MAY, IN HIS
   32  OR HER DISCRETION, AGREE  TO  THE  APPLICATION  OR  USE  OF  ALTERNATIVE
   33  ADJUSTMENTS OR COMPUTATIONS WHEN HE OR SHE CONCLUDES THAT IN THE ABSENCE
   34  OF  SUCH  AGREEMENT  THE  INCOME  OF  THE TAXPAYER WOULD NOT BE PROPERLY
   35  REFLECTED.
   36    S 3. Paragraph 6 of subdivision (a) of section 292 of the tax law,  as
   37  amended  by  section 15 of part M of chapter 686 of the laws of 2003, is
   38  amended to read as follows:
   39    (6) Related members expense add back  [and  income  exclusion].    (A)
   40  Definitions.  (i) Related member [or members. For purposes of this para-
   41  graph, the term related member or members means a  person,  corporation,
   42  or other entity, including an entity that is treated as a partnership or
   43  other  pass-through  vehicle  for  purposes of federal taxation, whether
   44  such person, corporation or entity is a taxpayer or not, where one  such
   45  person,  corporation, or entity, or set of related persons, corporations
   46  or entities, directly or  indirectly  owns  or  controls  a  controlling
   47  interest  in  another  entity.  Such  entity or entities may include all
   48  taxpayers under article nine, nine-A, thirteen, twenty-two,  thirty-two,
   49  thirty-three or thirty-three-A of this chapter].  "RELATED MEMBER" MEANS
   50  A  RELATED  PERSON  AS DEFINED IN SUBPARAGRAPH (C) OF PARAGRAPH THREE OF
   51  SUBSECTION (B) OF SECTION FOUR HUNDRED SIXTY-FIVE OF THE INTERNAL REVEN-
   52  UE CODE, EXCEPT THAT "FIFTY  PERCENT"  SHALL  BE  SUBSTITUTED  FOR  "TEN
   53  PERCENT".
   54    (ii)  [Controlling  interest. A controlling interest shall mean (I) in
   55  the case of a corporation, either thirty percent or more  of  the  total
   56  combined  voting  power  of all classes of stock of such corporation, or
       S. 2609--A                         22                         A. 3009--A
    1  thirty percent or more of the capital, profits or beneficial interest in
    2  such voting stock of such corporation, and (II) in the case of  a  part-
    3  nership,  association,  trust or other entity, thirty percent or more of
    4  the capital, profits or beneficial interest in such partnership, associ-
    5  ation, trust or other entity.] EFFECTIVE RATE OF TAX. "EFFECTIVE RATE OF
    6  TAX"  MEANS,  AS  TO ANY STATE OR U.S. POSSESSION, THE MAXIMUM STATUTORY
    7  RATE OF TAX IMPOSED BY THE STATE OR  POSSESSION  ON  OR  MEASURED  BY  A
    8  RELATED  MEMBER'S NET INCOME MULTIPLIED BY THE APPORTIONMENT PERCENTAGE,
    9  IF ANY, APPLICABLE TO THE RELATED MEMBER UNDER THE LAWS OF  SAID  JURIS-
   10  DICTION.  FOR  PURPOSES OF THIS DEFINITION, THE EFFECTIVE RATE OF TAX AS
   11  TO ANY STATE OR U.S. POSSESSION IS ZERO WHERE THE RELATED  MEMBER'S  NET
   12  INCOME  TAX  LIABILITY IN SAID JURISDICTION IS REPORTED ON A COMBINED OR
   13  CONSOLIDATED RETURN INCLUDING BOTH THE TAXPAYER AND THE  RELATED  MEMBER
   14  WHERE  THE  REPORTED  TRANSACTIONS  BETWEEN THE TAXPAYER AND THE RELATED
   15  MEMBER ARE ELIMINATED OR OFFSET.  ALSO, FOR PURPOSES OF THIS DEFINITION,
   16  WHEN COMPUTING THE EFFECTIVE RATE OF TAX FOR A JURISDICTION IN  WHICH  A
   17  RELATED MEMBER'S NET INCOME IS ELIMINATED OR OFFSET BY A CREDIT OR SIMI-
   18  LAR  ADJUSTMENT  THAT  IS DEPENDENT UPON THE RELATED MEMBER EITHER MAIN-
   19  TAINING OR MANAGING INTANGIBLE PROPERTY OR COLLECTING INTEREST INCOME IN
   20  THAT JURISDICTION, THE MAXIMUM STATUTORY RATE OF  TAX  IMPOSED  BY  SAID
   21  JURISDICTION  SHALL  BE  DECREASED  TO REFLECT THE STATUTORY RATE OF TAX
   22  THAT APPLIES TO THE RELATED MEMBER AS EFFECTIVELY REDUCED BY SUCH CREDIT
   23  OR SIMILAR ADJUSTMENT.
   24    (iii)  Royalty  payments.  Royalty  payments  are  payments   directly
   25  connected to the acquisition, use, maintenance or management, ownership,
   26  sale,  exchange, or any other disposition of licenses, trademarks, copy-
   27  rights, trade names, trade  dress,  service  marks,  mask  works,  trade
   28  secrets,  patents  and  any  other similar types of intangible assets as
   29  determined by the commissioner, and [includes] INCLUDE amounts allowable
   30  as interest deductions under section  one  hundred  sixty-three  of  the
   31  internal  revenue  code to the extent such amounts are directly or indi-
   32  rectly for, related to or in connection with the acquisition, use, main-
   33  tenance or management, ownership, sale, exchange or disposition of  such
   34  intangible assets.
   35    (iv)  Valid  business purpose. A valid business purpose is one or more
   36  business purposes other than the  avoidance  or  reduction  of  taxation
   37  which alone or in combination constitute the primary motivation for some
   38  business  activity or transaction, which activity or transaction changes
   39  in a meaningful way, apart from tax effects, the  economic  position  of
   40  the taxpayer. The economic position of the taxpayer includes an increase
   41  in  the  market share of the taxpayer, or the entry by the taxpayer into
   42  new business markets.
   43    (B) Royalty expense add backs. (i) For the purpose  of  computing  New
   44  York unrelated business taxable income, a taxpayer must add back royalty
   45  payments  [to  a]  DIRECTLY  OR INDIRECTLY PAID, ACCRUED, OR INCURRED IN
   46  CONNECTION WITH ONE OR MORE DIRECT OR INDIRECT TRANSACTIONS WITH ONE  OR
   47  MORE  related  [member]  MEMBERS  during  the taxable year to the extent
   48  deductible in calculating federal unrelated business taxable income;
   49    (ii) [The add back of royalty payments shall not be required if and to
   50  the extent that such payments meet either of the following conditions:
   51    (I) the related member during the same taxable year directly or  indi-
   52  rectly  paid  or incurred the amount to a person or entity that is not a
   53  related member, and such transaction was done for a valid  business  and
   54  the payments are made at arm's length;
   55    (II)  the  royalty  payments  are paid or incurred to a related member
   56  organized under the laws of a country other than the United States,  are
       S. 2609--A                         23                         A. 3009--A
    1  subject  to  a  comprehensive income tax treaty between such country and
    2  the United States, and are taxed in such country at a tax rate at  least
    3  equal to that imposed by this state.
    4    (C)  Royalty  income exclusions. For the purpose of computing New York
    5  unrelated business taxable income, a taxpayer shall be allowed to deduct
    6  royalty payments directly or indirectly received from a  related  member
    7  during the taxable year to the extent included in the taxpayer's federal
    8  taxable  income unless such royalty payments would not be required to be
    9  added back under subparagraph (B) of this  paragraph  or  other  similar
   10  provision  in  this chapter.] EXCEPTIONS. (I) THE ADJUSTMENT REQUIRED IN
   11  THIS PARAGRAPH SHALL NOT APPLY TO THE PORTION  OF  THE  ROYALTY  PAYMENT
   12  THAT  THE  TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE OF THE
   13  TYPE AND IN THE FORM SPECIFIED BY THE COMMISSIONER,  MEETS  ALL  OF  THE
   14  FOLLOWING  REQUIREMENTS:  (A)  THE  RELATED MEMBER WAS SUBJECT TO TAX IN
   15  THIS STATE OR ANOTHER STATE OR POSSESSION OF  THE  UNITED  STATES  OR  A
   16  FOREIGN  NATION  OR SOME COMBINATION THEREOF ON A TAX BASE THAT INCLUDED
   17  THE ROYALTY PAYMENT PAID, ACCRUED OR INCURRED BY THE TAXPAYER;  (B)  THE
   18  RELATED MEMBER DURING THE SAME TAXABLE YEAR DIRECTLY OR INDIRECTLY PAID,
   19  ACCRUED  OR  INCURRED  SUCH  PORTION  TO  A PERSON THAT IS NOT A RELATED
   20  MEMBER; AND (C) THE TRANSACTION  GIVING  RISE  TO  THE  ROYALTY  PAYMENT
   21  BETWEEN  THE  TAXPAYER AND THE RELATED MEMBER WAS UNDERTAKEN FOR A VALID
   22  BUSINESS PURPOSE.
   23    (II) THE ADJUSTMENT REQUIRED IN THIS PARAGRAPH SHALL NOT APPLY IF  THE
   24  TAXPAYER  ESTABLISHES,  BY CLEAR AND CONVINCING EVIDENCE OF THE TYPE AND
   25  IN THE FORM SPECIFIED BY THE COMMISSIONER, THAT: (A) THE RELATED  MEMBER
   26  WAS  SUBJECT  TO  TAX  ON OR MEASURED BY ITS NET INCOME IN THIS STATE OR
   27  ANOTHER STATE OR POSSESSION OF THE UNITED  STATES  OR  SOME  COMBINATION
   28  THEREOF;  (B)  THE  TAX  BASE  FOR SAID TAX INCLUDED THE ROYALTY PAYMENT
   29  PAID, ACCRUED OR INCURRED BY THE TAXPAYER; AND (C) THE AGGREGATE  EFFEC-
   30  TIVE RATE OF TAX APPLIED TO THE RELATED MEMBER IN THOSE JURISDICTIONS IS
   31  NO LESS THAN EIGHTY PERCENT OF THE STATUTORY RATE OF TAX THAT APPLIED TO
   32  THE  TAXPAYER  UNDER  SECTION TWO HUNDRED NINETY OF THIS ARTICLE FOR THE
   33  TAXABLE YEAR.
   34    (III) THE ADJUSTMENT REQUIRED IN THIS PARAGRAPH SHALL NOT APPLY IF THE
   35  TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE OF THE  TYPE  AND
   36  IN THE FORM SPECIFIED BY THE COMMISSIONER, THAT: (A) THE ROYALTY PAYMENT
   37  WAS  PAID,  ACCRUED  OR INCURRED TO A RELATED MEMBER ORGANIZED UNDER THE
   38  LAWS OF A COUNTRY OTHER THAN THE UNITED STATES; (B) THE RELATED MEMBER'S
   39  INCOME FROM THE TRANSACTION WAS SUBJECT TO A  COMPREHENSIVE  INCOME  TAX
   40  TREATY  BETWEEN  SUCH  COUNTRY  AND  THE  UNITED STATES; (C) THE RELATED
   41  MEMBER WAS SUBJECT TO TAX IN  A  FOREIGN  NATION  ON  A  TAX  BASE  THAT
   42  INCLUDED  THE ROYALTY PAYMENT PAID, ACCRUED OR INCURRED BY THE TAXPAYER;
   43  (D) THE RELATED MEMBER'S INCOME FROM THE TRANSACTION WAS TAXED  IN  SUCH
   44  COUNTRY  AT  AN  EFFECTIVE RATE OF TAX AT LEAST EQUAL TO THAT IMPOSED BY
   45  THIS STATE; AND (E) THE ROYALTY PAYMENT WAS PAID,  ACCRUED  OR  INCURRED
   46  PURSUANT  TO  A  TRANSACTION  THAT  WAS  UNDERTAKEN FOR A VALID BUSINESS
   47  PURPOSE AND USING TERMS THAT REFLECT AN ARM'S LENGTH RELATIONSHIP.
   48    (IV) THE ADJUSTMENT REQUIRED IN THIS PARAGRAPH SHALL NOT APPLY IF  THE
   49  TAXPAYER AND THE COMMISSIONER AGREE IN WRITING TO THE APPLICATION OR USE
   50  OF ALTERNATIVE ADJUSTMENTS OR COMPUTATIONS. THE COMMISSIONER MAY, IN HIS
   51  OR  HER  DISCRETION,  AGREE  TO  THE  APPLICATION  OR USE OF ALTERNATIVE
   52  ADJUSTMENTS OR COMPUTATIONS WHEN HE OR SHE CONCLUDES THAT IN THE ABSENCE
   53  OF SUCH AGREEMENT THE INCOME OF  THE  TAXPAYER  WOULD  NOT  BE  PROPERLY
   54  REFLECTED.
   55    S  4.  Paragraph 19 of subsection (c) of section 612 of the tax law is
   56  REPEALED.
       S. 2609--A                         24                         A. 3009--A
    1    S 5. Subsection (r) of section 612 of  the  tax  law,  as  amended  by
    2  section  3  of  part M of chapter 686 of the laws of 2003, is amended to
    3  read as follows:
    4    (r)  Related  members  expense  add back [and income exclusion].   (1)
    5  Definitions. (A) Related  member  [or  members.  For  purposes  of  this
    6  subsection,  the  term  related member or members means a person, corpo-
    7  ration, or other entity, including an entity that is treated as a  part-
    8  nership  or other pass-through vehicle for purposes of federal taxation,
    9  whether such person, corporation or entity is a taxpayer or  not,  where
   10  one  such  person,  corporation,  or  entity, or set of related persons,
   11  corporations or entities, directly or  indirectly  owns  or  controls  a
   12  controlling  interest  in  another  entity.  Such entity or entities may
   13  include all taxpayers under article nine, nine-A, thirteen,  twenty-two,
   14  thirty-two,  thirty-three  or thirty-three-A of this chapter].  "RELATED
   15  MEMBER" MEANS A RELATED PERSON AS DEFINED IN SUBPARAGRAPH (C)  OF  PARA-
   16  GRAPH  THREE OF SUBSECTION (B) OF SECTION FOUR HUNDRED SIXTY-FIVE OF THE
   17  INTERNAL REVENUE CODE, EXCEPT THAT "FIFTY PERCENT" SHALL BE  SUBSTITUTED
   18  FOR "TEN PERCENT".
   19    (B)  [Controlling  interest.  A controlling interest shall mean (i) in
   20  the case of a corporation, either thirty percent or more  of  the  total
   21  combined  voting  power  of all classes of stock of such corporation, or
   22  thirty percent or more of the capital, profits or beneficial interest in
   23  such voting stock of such corporation, and (ii) in the case of  a  part-
   24  nership,  association,  trust or other entity, thirty percent or more of
   25  the capital, profits or beneficial interest in such partnership, associ-
   26  ation, trust or other entity.] EFFECTIVE RATE OF TAX.   "EFFECTIVE  RATE
   27  OF TAX" MEANS, AS TO ANY STATE OR U.S. POSSESSION, THE MAXIMUM STATUTORY
   28  RATE  OF  TAX  IMPOSED  BY  THE  STATE OR POSSESSION ON OR MEASURED BY A
   29  RELATED MEMBER'S NET INCOME MULTIPLIED BY THE APPORTIONMENT  PERCENTAGE,
   30  IF  ANY,  APPLICABLE TO THE RELATED MEMBER UNDER THE LAWS OF SAID JURIS-
   31  DICTION. FOR PURPOSES OF THIS DEFINITION, THE EFFECTIVE RATE OF  TAX  AS
   32  TO  ANY  STATE OR U.S. POSSESSION IS ZERO WHERE THE RELATED MEMBER'S NET
   33  INCOME TAX LIABILITY IN SAID JURISDICTION IS REPORTED ON A  COMBINED  OR
   34  CONSOLIDATED  RETURN  INCLUDING BOTH THE TAXPAYER AND THE RELATED MEMBER
   35  WHERE THE REPORTED TRANSACTIONS BETWEEN THE  TAXPAYER  AND  THE  RELATED
   36  MEMBER  ARE ELIMINATED OR OFFSET. ALSO, FOR PURPOSES OF THIS DEFINITION,
   37  WHEN COMPUTING THE EFFECTIVE RATE OF TAX FOR A JURISDICTION IN  WHICH  A
   38  RELATED MEMBER'S NET INCOME IS ELIMINATED OR OFFSET BY A CREDIT OR SIMI-
   39  LAR  ADJUSTMENT  THAT  IS DEPENDENT UPON THE RELATED MEMBER EITHER MAIN-
   40  TAINING OR MANAGING INTANGIBLE PROPERTY OR COLLECTING INTEREST INCOME IN
   41  THAT JURISDICTION, THE MAXIMUM STATUTORY RATE OF  TAX  IMPOSED  BY  SAID
   42  JURISDICTION  SHALL  BE  DECREASED  TO REFLECT THE STATUTORY RATE OF TAX
   43  THAT APPLIES TO THE RELATED MEMBER AS EFFECTIVELY REDUCED BY SUCH CREDIT
   44  OR SIMILAR ADJUSTMENT.
   45    (C) Royalty payments. Royalty payments are payments directly connected
   46  to the acquisition, use, maintenance  or  management,  ownership,  sale,
   47  exchange,  or any other disposition of licenses, trademarks, copyrights,
   48  trade names, trade dress, service  marks,  mask  works,  trade  secrets,
   49  patents  and  any other similar types of intangible assets as determined
   50  by the commissioner, and [includes] INCLUDE amounts allowable as  inter-
   51  est  deductions  under  section  one hundred sixty-three of the internal
   52  revenue code to the extent such amounts are directly or indirectly  for,
   53  related  to  or  in connection with the acquisition, use, maintenance or
   54  management, ownership, sale, exchange or disposition of such  intangible
   55  assets.
       S. 2609--A                         25                         A. 3009--A
    1    (D)  Valid  business  purpose. A valid business purpose is one or more
    2  business purposes, other than the avoidance or  reduction  of  taxation,
    3  which alone or in combination constitute the primary motivation for some
    4  business  activity or transaction, which activity or transaction changes
    5  in  a  meaningful  way, apart from tax effects, the economic position of
    6  the taxpayer. The economic position of the taxpayer includes an increase
    7  in the market share of the taxpayer, or the entry by the  taxpayer  into
    8  new business markets.
    9    (2)  Royalty  expense  add backs. (A) For the purpose of computing New
   10  York adjusted gross income, a taxpayer must add  back  royalty  payments
   11  [to  a]  DIRECTLY OR INDIRECTLY PAID, ACCRUED, OR INCURRED IN CONNECTION
   12  WITH ONE OR MORE DIRECT  OR  INDIRECT  TRANSACTIONS  WITH  ONE  OR  MORE
   13  related  [member]  MEMBERS during the taxable year to the extent deduct-
   14  ible in calculating federal taxable income.
   15    (B) [The add back of royalty payments shall not be required if and  to
   16  the extent that such payments meet either of the following conditions:
   17    (i)  the related member during the same taxable year directly or indi-
   18  rectly paid or incurred the amount to a person or entity that is  not  a
   19  related  member,  and such transaction was done for a valid business and
   20  the payments are made at arm's length;
   21    (ii) the royalty payments are paid or incurred  to  a  related  member
   22  organized  under the laws of a country other than the United States, are
   23  subject to a comprehensive income tax treaty between  such  country  and
   24  the  United States, and are taxed in such country at a tax rate at least
   25  equal to that imposed by this state.
   26    (3) Royalty income exclusions. For the purpose of computing  New  York
   27  adjusted  gross  income,  a  taxpayer shall be allowed to deduct royalty
   28  payments directly or indirectly received from a  related  member  during
   29  the  taxable year to the extent included in the taxpayer's federal taxa-
   30  ble income unless such royalty payments would  not  be  required  to  be
   31  added  back  under  paragraph  two  of  this subsection or other similar
   32  provision in this chapter.] EXCEPTIONS. (I) THE ADJUSTMENT  REQUIRED  IN
   33  THIS  SUBSECTION  SHALL  NOT APPLY TO THE PORTION OF THE ROYALTY PAYMENT
   34  THAT THE TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE  OF  THE
   35  TYPE  AND  IN  THE  FORM SPECIFIED BY THE COMMISSIONER, MEETS ALL OF THE
   36  FOLLOWING REQUIREMENTS: (I) THE RELATED MEMBER WAS  SUBJECT  TO  TAX  IN
   37  THIS  STATE  OR  ANOTHER  STATE  OR POSSESSION OF THE UNITED STATES OR A
   38  FOREIGN NATION OR SOME COMBINATION THEREOF ON A TAX BASE  THAT  INCLUDED
   39  THE  ROYALTY PAYMENT PAID, ACCRUED OR INCURRED BY THE TAXPAYER; (II) THE
   40  RELATED MEMBER DURING THE SAME TAXABLE YEAR DIRECTLY OR INDIRECTLY PAID,
   41  ACCRUED OR INCURRED SUCH PORTION TO A  PERSON  THAT  IS  NOT  A  RELATED
   42  MEMBER;  AND  (III)  THE  TRANSACTION GIVING RISE TO THE ROYALTY PAYMENT
   43  BETWEEN THE TAXPAYER AND THE RELATED MEMBER WAS UNDERTAKEN FOR  A  VALID
   44  BUSINESS PURPOSE.
   45    (II) THE ADJUSTMENT REQUIRED IN THIS SUBSECTION SHALL NOT APPLY IF THE
   46  TAXPAYER  ESTABLISHES,  BY CLEAR AND CONVINCING EVIDENCE OF THE TYPE AND
   47  IN THE FORM SPECIFIED BY THE COMMISSIONER, THAT: (I) THE RELATED  MEMBER
   48  WAS  SUBJECT  TO  TAX  ON OR MEASURED BY ITS NET INCOME IN THIS STATE OR
   49  ANOTHER STATE OR POSSESSION OF THE UNITED  STATES  OR  SOME  COMBINATION
   50  THEREOF;  (II)  THE  TAX BASE FOR SAID TAX  INCLUDED THE ROYALTY PAYMENT
   51  PAID, ACCRUED OR INCURRED BY  THE  TAXPAYER;  AND  (III)  THE  AGGREGATE
   52  EFFECTIVE  RATE  OF TAX APPLIED TO THE RELATED MEMBER IN THOSE JURISDIC-
   53  TIONS IS NO LESS THAN EIGHTY PERCENT OF THE STATUTORY RATE OF  TAX  THAT
   54  APPLIED  TO  THE  TAXPAYER UNDER SECTION SIX HUNDRED ONE OF THIS ARTICLE
   55  FOR THE TAXABLE YEAR.
       S. 2609--A                         26                         A. 3009--A
    1    (III) THE ADJUSTMENT REQUIRED IN THIS SUBSECTION SHALL  NOT  APPLY  IF
    2  THE  TAXPAYER  ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE OF THE TYPE
    3  AND IN THE FORM SPECIFIED BY THE COMMISSIONER,  THAT:  (I)  THE  ROYALTY
    4  PAYMENT  WAS  PAID,  ACCRUED  OR  INCURRED TO A RELATED MEMBER ORGANIZED
    5  UNDER  THE  LAWS  OF  A  COUNTRY  OTHER THAN THE UNITED STATES; (II) THE
    6  RELATED MEMBER'S INCOME FROM THE TRANSACTION WAS SUBJECT TO A COMPREHEN-
    7  SIVE INCOME TAX TREATY BETWEEN SUCH COUNTRY AND THE UNITED STATES; (III)
    8  THE RELATED MEMBER WAS SUBJECT TO TAX IN A FOREIGN NATION ON A TAX  BASE
    9  THAT  INCLUDED  THE  ROYALTY  PAYMENT  PAID,  ACCRUED OR INCURRED BY THE
   10  TAXPAYER; (IV) THE RELATED MEMBER'S  INCOME  FROM  THE  TRANSACTION  WAS
   11  TAXED  IN  SUCH  COUNTRY AT AN EFFECTIVE TAX RATE AT LEAST EQUAL TO THAT
   12  IMPOSED BY THIS STATE; AND (V) THE ROYALTY PAYMENT WAS PAID, ACCRUED  OR
   13  INCURRED PURSUANT TO A TRANSACTION THAT WAS UNDERTAKEN FOR A VALID BUSI-
   14  NESS PURPOSE AND USING TERMS THAT REFLECT AN ARM'S LENGTH RELATIONSHIP.
   15    (IV) THE ADJUSTMENT REQUIRED IN THIS SUBSECTION SHALL NOT APPLY IF THE
   16  TAXPAYER AND THE COMMISSIONER AGREE IN WRITING TO THE APPLICATION OR USE
   17  OF  ALTERNATIVE  ADJUSTMENTS OR COMPUTATIONS.   THE COMMISSIONER MAY, IN
   18  HIS OR HER DISCRETION, AGREE TO THE APPLICATION OR  USE  OF  ALTERNATIVE
   19  ADJUSTMENTS OR COMPUTATIONS WHEN HE OR SHE CONCLUDES THAT IN THE ABSENCE
   20  OF  SUCH  AGREEMENT  THE  INCOME  OF  THE TAXPAYER WOULD NOT BE PROPERLY
   21  REFLECTED.
   22    S 6. Paragraph 17 of subsection (e) of section 1453 of the tax law  is
   23  REPEALED.
   24    S  7.  Subsection  (r)  of  section 1453 of the tax law, as amended by
   25  section 5 of part M of chapter 686 of the laws of 2003, subparagraph (A)
   26  of paragraph 2 as amended by section 5 of part J of chapter  60  of  the
   27  laws of 2007, is amended to read as follows:
   28    (r)  Related  members  expense  add back [and income exclusion].   (1)
   29  Definitions. (A) Related  member  [or  members.  For  purposes  of  this
   30  subsection,  the  term  related member or members means a person, corpo-
   31  ration, or other entity, including an entity that is treated as a  part-
   32  nership  or other pass-through vehicle for purposes of federal taxation,
   33  whether such person, corporation or entity is a taxpayer or  not,  where
   34  one  such  person,  corporation,  or  entity, or set of related persons,
   35  corporations or entities, directly or  indirectly  owns  or  controls  a
   36  controlling  interest  in  another  entity.  Such entity or entities may
   37  include all taxpayers under article nine, nine-A, thirteen,  twenty-two,
   38  thirty-two,  thirty-three  or thirty-three-A of this chapter].  "RELATED
   39  MEMBER" MEANS A RELATED PERSON AS DEFINED IN SUBPARAGRAPH (C)  OF  PARA-
   40  GRAPH  THREE OF SUBSECTION (B) OF SECTION FOUR HUNDRED SIXTY-FIVE OF THE
   41  INTERNAL REVENUE CODE, EXCEPT THAT "FIFTY PERCENT" SHALL BE  SUBSTITUTED
   42  FOR "TEN PERCENT".
   43    (B)  [Controlling  interest.  A controlling interest shall mean (i) in
   44  the case of a corporation, either thirty percent or more  of  the  total
   45  combined  voting  power  of all classes of stock of such corporation, or
   46  thirty percent or more of the capital, profits or beneficial interest in
   47  such voting stock of such corporation, and (ii) in the case of  a  part-
   48  nership,  association,  trust or other entity, thirty percent or more of
   49  the capital, profits or beneficial interest in such partnership, associ-
   50  ation, trust or other entity.] EFFECTIVE RATE OF TAX. "EFFECTIVE RATE OF
   51  TAX" MEANS, AS TO ANY STATE OR U.S.  POSSESSION, THE  MAXIMUM  STATUTORY
   52  RATE  OF  TAX  IMPOSED  BY  THE  STATE OR POSSESSION ON OR MEASURED BY A
   53  RELATED MEMBER'S NET INCOME MULTIPLIED BY THE APPORTIONMENT  PERCENTAGE,
   54  IF  ANY,  APPLICABLE TO THE RELATED MEMBER UNDER THE LAWS OF SAID JURIS-
   55  DICTION. FOR PURPOSES OF THIS DEFINITION, THE EFFECTIVE RATE OF  TAX  AS
   56  TO  ANY  STATE OR U.S. POSSESSION IS ZERO WHERE THE RELATED MEMBER'S NET
       S. 2609--A                         27                         A. 3009--A
    1  INCOME TAX LIABILITY IN SAID JURISDICTION IS REPORTED ON A  COMBINED  OR
    2  CONSOLIDATED  RETURN  INCLUDING BOTH THE TAXPAYER AND THE RELATED MEMBER
    3  WHERE THE REPORTED TRANSACTIONS BETWEEN THE  TAXPAYER  AND  THE  RELATED
    4  MEMBER  ARE ELIMINATED OR OFFSET. ALSO, FOR PURPOSES OF THIS DEFINITION,
    5  WHEN COMPUTING THE EFFECTIVE RATE OF TAX FOR A JURISDICTION IN  WHICH  A
    6  RELATED MEMBER'S NET INCOME IS ELIMINATED OR OFFSET BY A CREDIT OR SIMI-
    7  LAR  ADJUSTMENT  THAT  IS DEPENDENT UPON THE RELATED MEMBER EITHER MAIN-
    8  TAINING OR MANAGING INTANGIBLE PROPERTY OR COLLECTING INTEREST INCOME IN
    9  THAT JURISDICTION, THE MAXIMUM STATUTORY RATE OF  TAX  IMPOSED  BY  SAID
   10  JURISDICTION  SHALL  BE  DECREASED  TO REFLECT THE STATUTORY RATE OF TAX
   11  THAT APPLIES TO THE RELATED MEMBER AS EFFECTIVELY REDUCED BY SUCH CREDIT
   12  OR SIMILAR ADJUSTMENT.
   13    (C) Royalty payments. Royalty payments are payments directly connected
   14  to the acquisition, use, maintenance  or  management,  ownership,  sale,
   15  exchange,  or any other disposition of licenses, trademarks, copyrights,
   16  trade names, trade dress, service  marks,  mask  works,  trade  secrets,
   17  patents  and  any other similar types of intangible assets as determined
   18  by the commissioner, and [includes] INCLUDE amounts allowable as  inter-
   19  est  deductions  under  section  one hundred sixty-three of the internal
   20  revenue code to the extent such amounts are directly or indirectly  for,
   21  related  to  or  in connection with the acquisition, use, maintenance or
   22  management, ownership, sale, exchange or disposition of such  intangible
   23  assets.
   24    (D)  Valid  business  purpose. A valid business purpose is one or more
   25  business purposes, other than the avoidance or  reduction  of  taxation,
   26  which alone or in combination constitute the primary motivation for some
   27  business  activity or transaction, which activity or transaction changes
   28  in a meaningful way, apart from tax effects, the  economic  position  of
   29  the taxpayer. The economic position of the taxpayer includes an increase
   30  in  the  market share of the taxpayer, or the entry by the taxpayer into
   31  new business markets.
   32    (2) Royalty expense add backs. (A) Except where a taxpayer is included
   33  in a combined return with a related member pursuant to subsection (f) of
   34  section fourteen hundred sixty-two of this article, for the  purpose  of
   35  computing  entire  net income, a taxpayer must add back royalty payments
   36  [to a] DIRECTLY OR INDIRECTLY PAID, ACCRUED, OR INCURRED  IN  CONNECTION
   37  WITH  ONE  OR  MORE  DIRECT  OR  INDIRECT  TRANSACTIONS WITH ONE OR MORE
   38  related [member] MEMBERS during the taxable year to the  extent  deduct-
   39  ible in calculating federal taxable income.
   40    (B)  [The add back of royalty payments shall not be required if and to
   41  the extent that such payments meet either of the following conditions:
   42    (i) the related member during the same taxable year directly or  indi-
   43  rectly  paid  or incurred the amount to a person or entity that is not a
   44  related member, and such transaction was done for a valid  business  and
   45  the payments are made at arm's length;
   46    (ii)  the  royalty  payments  are paid or incurred to a related member
   47  organized under the laws of a country other than the United States,  are
   48  subject  to  a  comprehensive income tax treaty between such country and
   49  the United States, and are taxed in such country at a tax rate at  least
   50  equal to that imposed by this state.
   51    (3) Royalty income exclusions. For the purpose of computing entire net
   52  income,  a taxpayer shall be allowed to deduct royalty payments directly
   53  or indirectly received from a related member during the taxable year  to
   54  the extent included in the taxpayer's federal taxable income unless such
   55  royalty  payments would not be required to be added back under paragraph
   56  two of this subsection or other  similar  provision  in  this  chapter.]
       S. 2609--A                         28                         A. 3009--A
    1  EXCEPTIONS.  (I)  THE  ADJUSTMENT  REQUIRED IN THIS SUBSECTION SHALL NOT
    2  APPLY TO THE PORTION OF THE ROYALTY PAYMENT  THAT  THE  TAXPAYER  ESTAB-
    3  LISHES,  BY  CLEAR  AND  CONVINCING EVIDENCE OF THE TYPE AND IN THE FORM
    4  SPECIFIED  BY THE COMMISSIONER, MEETS ALL OF THE FOLLOWING REQUIREMENTS:
    5  (I) THE RELATED MEMBER WAS SUBJECT TO TAX IN THIS STATE OR ANOTHER STATE
    6  OR POSSESSION OF THE UNITED STATES OR A FOREIGN NATION OR SOME  COMBINA-
    7  TION  THEREOF  ON  A  TAX  BASE  THAT INCLUDED THE ROYALTY PAYMENT PAID,
    8  ACCRUED OR INCURRED BY THE TAXPAYER; (II) THE RELATED MEMBER DURING  THE
    9  SAME  TAXABLE YEAR DIRECTLY OR INDIRECTLY PAID, ACCRUED OR INCURRED SUCH
   10  PORTION TO A PERSON THAT IS NOT A RELATED MEMBER; AND (III)  THE  TRANS-
   11  ACTION  GIVING  RISE TO THE ROYALTY PAYMENT BETWEEN THE TAXPAYER AND THE
   12  RELATED MEMBER WAS UNDERTAKEN FOR A VALID BUSINESS PURPOSE.
   13    (II) THE ADJUSTMENT REQUIRED IN THIS SUBSECTION SHALL NOT APPLY IF THE
   14  TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE OF THE  TYPE  AND
   15  IN  THE FORM SPECIFIED BY THE COMMISSIONER, THAT: (I) THE RELATED MEMBER
   16  WAS SUBJECT TO TAX ON OR MEASURED BY ITS NET INCOME  IN  THIS  STATE  OR
   17  ANOTHER  STATE  OR  POSSESSION  OF THE UNITED STATES OR SOME COMBINATION
   18  THEREOF; (II) THE TAX BASE FOR SAID TAX  INCLUDED  THE  ROYALTY  PAYMENT
   19  PAID,  ACCRUED  OR  INCURRED  BY  THE  TAXPAYER; AND (III) THE AGGREGATE
   20  EFFECTIVE RATE OF TAX APPLIED TO THE RELATED MEMBER IN  THOSE  JURISDIC-
   21  TIONS  IS  NO LESS THAN EIGHTY PERCENT OF THE STATUTORY RATE OF TAX THAT
   22  APPLIED TO THE TAXPAYER UNDER SECTION  FOURTEEN  HUNDRED  FIFTY-FIVE  OF
   23  THIS ARTICLE FOR THE TAXABLE YEAR.
   24    (III)  THE  ADJUSTMENT  REQUIRED IN THIS SUBSECTION SHALL NOT APPLY IF
   25  THE TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE OF  THE  TYPE
   26  AND  IN  THE  FORM  SPECIFIED BY THE COMMISSIONER, THAT: (I) THE ROYALTY
   27  PAYMENT WAS PAID, ACCRUED OR INCURRED  TO  A  RELATED  MEMBER  ORGANIZED
   28  UNDER  THE  LAWS  OF  A  COUNTRY  OTHER THAN THE UNITED STATES; (II) THE
   29  RELATED MEMBER'S INCOME FROM THE TRANSACTION WAS SUBJECT TO A COMPREHEN-
   30  SIVE INCOME TAX TREATY BETWEEN SUCH COUNTRY AND THE UNITED STATES; (III)
   31  THE RELATED MEMBER WAS SUBJECT TO TAX IN A FOREIGN NATION ON A TAX  BASE
   32  THAT  INCLUDED  THE  ROYALTY  PAYMENT  PAID,  ACCRUED OR INCURRED BY THE
   33  TAXPAYER; (IV) THE RELATED MEMBER'S  INCOME  FROM  THE  TRANSACTION  WAS
   34  TAXED IN SUCH COUNTRY AT AN EFFECTIVE RATE OF TAX AT LEAST EQUAL TO THAT
   35  IMPOSED  BY THIS STATE; AND (V) THE ROYALTY PAYMENT WAS PAID, ACCRUED OR
   36  INCURRED PURSUANT TO A TRANSACTION THAT WAS UNDERTAKEN FOR A VALID BUSI-
   37  NESS PURPOSE AND USING TERMS THAT REFLECT AN ARM'S LENGTH RELATIONSHIP.
   38    (IV) THE ADJUSTMENT REQUIRED IN THIS SUBSECTION SHALL NOT APPLY IF THE
   39  TAXPAYER AND THE COMMISSIONER AGREE IN WRITING TO THE APPLICATION OR USE
   40  OF ALTERNATIVE ADJUSTMENTS OR COMPUTATIONS. THE COMMISSIONER MAY, IN HIS
   41  OR HER DISCRETION, AGREE  TO  THE  APPLICATION  OR  USE  OF  ALTERNATIVE
   42  ADJUSTMENTS OR COMPUTATIONS WHEN HE OR SHE CONCLUDES THAT IN THE ABSENCE
   43  OF  SUCH  AGREEMENT  THE  INCOME  OF  THE TAXPAYER WOULD NOT BE PROPERLY
   44  REFLECTED.
   45    S 8. Paragraph 14 of subdivision (b) of section 1503 of the  tax  law,
   46  as  amended  by  section 7 of part M of chapter 686 of the laws of 2003,
   47  clause (i) of subparagraph (B) as amended by section  6  of  part  J  of
   48  chapter 60 of the laws of 2007, is amended to read as follows:
   49    (14)  Related  members  expense  add back [and income exclusion].  (A)
   50  Definitions. (i) Related member [or members. For purposes of this  para-
   51  graph,  the  term related member or members means a person, corporation,
   52  or other entity, including an entity that is treated as a partnership or
   53  other pass-through vehicle for purposes  of  federal  taxation,  whether
   54  such  person, corporation or entity is a taxpayer or not, where one such
   55  person, corporation, or entity, or set of related persons,  corporations
   56  or  entities,  directly  or  indirectly  owns  or controls a controlling
       S. 2609--A                         29                         A. 3009--A
    1  interest in another entity. Such entity  or  entities  may  include  all
    2  taxpayers  under article nine, nine-A, thirteen, twenty-two, thirty-two,
    3  thirty-three or thirty-three-A of this chapter]. "RELATED MEMBER"  MEANS
    4  A  RELATED  PERSON  AS DEFINED IN SUBPARAGRAPH (C) OF PARAGRAPH THREE OF
    5  SUBSECTION (B) OF SECTION FOUR HUNDRED SIXTY-FIVE OF THE INTERNAL REVEN-
    6  UE CODE, EXCEPT THAT "FIFTY  PERCENT"  SHALL  BE  SUBSTITUTED  FOR  "TEN
    7  PERCENT".
    8    (ii)  [Controlling  interest. A controlling interest shall mean (I) in
    9  the case of a corporation, either thirty percent or more  of  the  total
   10  combined  voting  power  of all classes of stock of such corporation, or
   11  thirty percent or more of the capital, profits or beneficial interest in
   12  such voting stock of such corporation, and (II) in the case of  a  part-
   13  nership,  association,  trust or other entity, thirty percent or more of
   14  the capital, profits or beneficial interest in such partnership, associ-
   15  ation, trust or other entity.] EFFECTIVE RATE OF TAX. "EFFECTIVE RATE OF
   16  TAX" MEANS, AS TO ANY STATE OR U.S. POSSESSION,  THE  MAXIMUM  STATUTORY
   17  RATE  OF  TAX  IMPOSED  BY  THE  STATE OR POSSESSION ON OR MEASURED BY A
   18  RELATED MEMBER'S NET INCOME MULTIPLIED BY THE APPORTIONMENT  PERCENTAGE,
   19  IF  ANY,  APPLICABLE TO THE RELATED MEMBER UNDER THE LAWS OF SAID JURIS-
   20  DICTION. FOR PURPOSES OF THIS DEFINITION, THE EFFECTIVE RATE OF  TAX  AS
   21  TO  ANY  STATE OR U.S. POSSESSION IS ZERO WHERE THE RELATED MEMBER'S NET
   22  INCOME TAX LIABILITY IN SAID JURISDICTION IS REPORTED ON A  COMBINED  OR
   23  CONSOLIDATED  RETURN  INCLUDING BOTH THE TAXPAYER AND THE RELATED MEMBER
   24  WHERE THE REPORTED TRANSACTIONS BETWEEN THE  TAXPAYER  AND  THE  RELATED
   25  MEMBER  ARE ELIMINATED OR OFFSET. ALSO, FOR PURPOSES OF THIS DEFINITION,
   26  WHEN COMPUTING THE EFFECTIVE RATE OF TAX FOR A JURISDICTION IN  WHICH  A
   27  RELATED MEMBER'S NET INCOME IS ELIMINATED OR OFFSET BY A CREDIT OR SIMI-
   28  LAR  ADJUSTMENT  THAT  IS DEPENDENT UPON THE RELATED MEMBER EITHER MAIN-
   29  TAINING OR MANAGING  INTANGIBLE PROPERTY OR COLLECTING  INTEREST  INCOME
   30  IN  THAT JURISDICTION, THE MAXIMUM STATUTORY RATE OF TAX IMPOSED BY SAID
   31  JURISDICTION SHALL BE DECREASED TO REFLECT THE  STATUTORY  RATE  OF  TAX
   32  THAT APPLIES TO THE RELATED MEMBER AS EFFECTIVELY REDUCED BY SUCH CREDIT
   33  OR SIMILAR ADJUSTMENT.
   34    (iii)   Royalty  payments.  Royalty  payments  are  payments  directly
   35  connected to the acquisition, use, maintenance or management, ownership,
   36  sale, exchange, or any other disposition of licenses, trademarks,  copy-
   37  rights,  trade  names,  trade  dress,  service  marks, mask works, trade
   38  secrets, patents and any other similar types  of  intangible  assets  as
   39  determined by the commissioner, and [includes] INCLUDE amounts allowable
   40  as  interest  deductions  under  section  one hundred sixty-three of the
   41  internal revenue code to the extent such amounts are directly  or  indi-
   42  rectly for, related to or in connection with the acquisition, use, main-
   43  tenance  or management, ownership, sale, exchange or disposition of such
   44  intangible assets.
   45    (iv) Valid business purpose. A valid business purpose is one  or  more
   46  business  purposes,  other  than the avoidance or reduction of taxation,
   47  which alone or in combination constitute the primary motivation for some
   48  business activity or transaction, which activity or transaction  changes
   49  in  a  meaningful  way, apart from tax effects, the economic position of
   50  the taxpayer. The economic position of the taxpayer includes an increase
   51  in the market share of the taxpayer, or the entry by the  taxpayer  into
   52  new business markets.
   53    (B) Royalty expense add backs. (i) Except where a taxpayer is included
   54  in  a  combined return with a related member pursuant to subdivision (f)
   55  of section fifteen hundred fifteen of this article, for the  purpose  of
   56  computing  entire  net income, a taxpayer must add back royalty payments
       S. 2609--A                         30                         A. 3009--A
    1  [to a] DIRECTLY OR INDIRECTLY PAID, ACCRUED, OR INCURRED  IN  CONNECTION
    2  WITH  ONE  OR  MORE  DIRECT  OR  INDIRECT  TRANSACTIONS WITH ONE OR MORE
    3  related [member] MEMBERS during the taxable year to the  extent  deduct-
    4  ible in calculating federal taxable income.
    5    (ii) [The add back of royalty payments shall not be required if and to
    6  the extent that such payments meet either of the following conditions:
    7    (I)  the related member during the same taxable year directly or indi-
    8  rectly paid or incurred the amount to a person or entity that is  not  a
    9  related  member,  and such transaction was done for a valid business and
   10  the payments are made at arm's length;
   11    (II) the royalty payments are paid or incurred  to  a  related  member
   12  organized  under the laws of a country other than the United States, are
   13  subject to a comprehensive income tax treaty between  such  country  and
   14  the  United States, and are taxed in such country at a tax rate at least
   15  equal to that imposed by this state.
   16    (C) Royalty income exclusions. For the purpose of computing entire net
   17  income, a taxpayer shall be allowed to deduct royalty payments  directly
   18  or  indirectly received from a related member during the taxable year to
   19  the extent included in the taxpayer's federal taxable income unless such
   20  royalty payments would not be required to be added back  under  subpara-
   21  graph (B) of this paragraph or other similar provision in this chapter.]
   22  EXCEPTIONS.    (I)  THE  ADJUSTMENT REQUIRED IN THIS PARAGRAPH SHALL NOT
   23  APPLY TO THE PORTION OF THE ROYALTY PAYMENT  THAT  THE  TAXPAYER  ESTAB-
   24  LISHES,  BY  CLEAR  AND  CONVINCING EVIDENCE OF THE TYPE AND IN THE FORM
   25  SPECIFIED BY THE COMMISSIONER, MEETS ALL OF THE FOLLOWING  REQUIREMENTS:
   26  (A) THE RELATED MEMBER WAS SUBJECT TO TAX IN THIS STATE OR ANOTHER STATE
   27  OR  POSSESSION OF THE UNITED STATES OR A FOREIGN NATION OR SOME COMBINA-
   28  TION THEREOF ON A TAX BASE  THAT  INCLUDED  THE  ROYALTY  PAYMENT  PAID,
   29  ACCRUED  OR  INCURRED BY THE TAXPAYER; (B) THE RELATED MEMBER DURING THE
   30  SAME TAXABLE YEAR DIRECTLY OR INDIRECTLY PAID, ACCRUED OR INCURRED  SUCH
   31  PORTION  TO  A  PERSON  THAT IS NOT A RELATED MEMBER; AND (C) THE TRANS-
   32  ACTION GIVING RISE TO THE ROYALTY PAYMENT BETWEEN THE TAXPAYER  AND  THE
   33  RELATED MEMBER WAS UNDERTAKEN FOR A VALID BUSINESS PURPOSE.
   34    (II)  THE ADJUSTMENT REQUIRED IN THIS PARAGRAPH SHALL NOT APPLY IF THE
   35  TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE OF THE  TYPE  AND
   36  IN  THE FORM SPECIFIED BY THE COMMISSIONER, THAT: (A) THE RELATED MEMBER
   37  WAS SUBJECT TO TAX ON OR MEASURED BY ITS NET INCOME  IN  THIS  STATE  OR
   38  ANOTHER  STATE  OR  POSSESSION  OF THE UNITED STATES OR SOME COMBINATION
   39  THEREOF; (B) THE TAX BASE FOR SAID  TAX  INCLUDED  THE  ROYALTY  PAYMENT
   40  PAID,  ACCRUED OR INCURRED BY THE TAXPAYER; AND (C) THE AGGREGATE EFFEC-
   41  TIVE RATE OF TAX APPLIED TO THE RELATED MEMBER IN THOSE JURISDICTIONS IS
   42  NO LESS THAN EIGHTY PERCENT OF THE STATUTORY RATE OF TAX THAT APPLIED TO
   43  THE TAXPAYER UNDER SECTION FIFTEEN HUNDRED TWO, FIFTEEN  HUNDRED  TWO-A,
   44  OR FIFTEEN HUNDRED TWO-B OF THIS ARTICLE FOR THE TAXABLE YEAR.
   45    (III) THE ADJUSTMENT REQUIRED IN THIS PARAGRAPH SHALL NOT APPLY IF THE
   46  TAXPAYER  ESTABLISHES,  BY CLEAR AND CONVINCING EVIDENCE OF THE TYPE AND
   47  IN THE FORM SPECIFIED BY THE COMMISSIONER, THAT: (A) THE ROYALTY PAYMENT
   48  WAS PAID, ACCRUED OR INCURRED TO A RELATED MEMBER  ORGANIZED  UNDER  THE
   49  LAWS OF A COUNTRY OTHER THAN THE UNITED STATES; (B) THE RELATED MEMBER'S
   50  INCOME  FROM  THE  TRANSACTION WAS SUBJECT TO A COMPREHENSIVE INCOME TAX
   51  TREATY BETWEEN SUCH COUNTRY AND  THE  UNITED  STATES;  (C)  THE  RELATED
   52  MEMBER  WAS  SUBJECT  TO  TAX  IN  A  FOREIGN  NATION ON A TAX BASE THAT
   53  INCLUDED THE ROYALTY PAYMENT PAID, ACCRUED OR INCURRED BY THE  TAXPAYER;
   54  (D)  THE  RELATED MEMBER'S INCOME FROM THE TRANSACTION WAS TAXED IN SUCH
   55  COUNTRY AT AN EFFECTIVE RATE OF TAX AT LEAST EQUAL TO  THAT  IMPOSED  BY
   56  THIS  STATE;  AND  (E) THE ROYALTY PAYMENT WAS PAID, ACCRUED OR INCURRED
       S. 2609--A                         31                         A. 3009--A
    1  PURSUANT TO A TRANSACTION THAT  WAS  UNDERTAKEN  FOR  A  VALID  BUSINESS
    2  PURPOSE AND USING TERMS THAT REFLECT AN ARM'S LENGTH RELATIONSHIP.
    3    (IV)  THE ADJUSTMENT REQUIRED IN THIS PARAGRAPH SHALL NOT APPLY IF THE
    4  TAXPAYER AND THE COMMISSIONER AGREE IN WRITING TO THE APPLICATION OR USE
    5  OF ALTERNATIVE ADJUSTMENTS OR COMPUTATIONS. THE COMMISSIONER MAY, IN HIS
    6  OR HER DISCRETION, AGREE  TO  THE  APPLICATION  OR  USE  OF  ALTERNATIVE
    7  ADJUSTMENTS OR COMPUTATIONS WHEN HE OR SHE CONCLUDES THAT IN THE ABSENCE
    8  OF  SUCH  AGREEMENT  THE  INCOME  OF  THE TAXPAYER WOULD NOT BE PROPERLY
    9  REFLECTED.
   10    S 9. Subdivision (e) of section 11-506 of the administrative  code  of
   11  the city of New York, as added by section 17 of part M of chapter 686 of
   12  the  laws  of 2003 and as relettered by chapter 633 of the laws of 2005,
   13  is amended to read as follows:
   14    (e) Related members expense add back  [and  income  exclusion].    (1)
   15  Definitions. (A) Related member [or members. For purposes of this subdi-
   16  vision,  the term related member or members means a person, corporation,
   17  or other entity, including an entity that is treated as a partnership or
   18  other pass-through vehicle for purposes  of  federal  taxation,  whether
   19  such  person, corporation or entity is a taxpayer or not, where one such
   20  person, corporation, or entity, or set of related persons,  corporations
   21  or  entities,  directly  or  indirectly  owns  or controls a controlling
   22  interest in another entity. Such entity  or  entities  may  include  all
   23  taxpayers  under this title]. "RELATED MEMBER" MEANS A RELATED PERSON AS
   24  DEFINED IN SUBPARAGRAPH (C) OF PARAGRAPH  THREE  OF  SUBSECTION  (B)  OF
   25  SECTION  FOUR  HUNDRED  SIXTY-FIVE  OF THE INTERNAL REVENUE CODE, EXCEPT
   26  THAT "FIFTY PERCENT" SHALL BE SUBSTITUTED FOR "TEN PERCENT".
   27    (B) [Controlling interest. A controlling interest shall  mean  (i)  in
   28  the  case  of  a corporation, either thirty percent or more of the total
   29  combined voting power of all classes of stock of  such  corporation,  or
   30  thirty percent or more of the capital, profits or beneficial interest in
   31  such  voting  stock of such corporation, and (ii) in the case of a part-
   32  nership, association, trust or other entity, thirty percent or  more  of
   33  the capital, profits or beneficial interest in such partnership, associ-
   34  ation, trust or other entity.] EFFECTIVE RATE OF TAX. "EFFECTIVE RATE OF
   35  TAX" MEANS, AS TO ANY CITY, THE MAXIMUM STATUTORY RATE OF TAX IMPOSED BY
   36  THE  CITY  ON OR MEASURED BY A RELATED MEMBER'S NET INCOME MULTIPLIED BY
   37  THE APPORTIONMENT PERCENTAGE, IF ANY, APPLICABLE TO THE  RELATED  MEMBER
   38  UNDER  THE  LAWS  OF SAID JURISDICTION. FOR PURPOSES OF THIS DEFINITION,
   39  THE EFFECTIVE RATE OF TAX AS TO ANY  CITY  IS  ZERO  WHERE  THE  RELATED
   40  MEMBER'S NET INCOME TAX LIABILITY IN SAID CITY IS REPORTED ON A COMBINED
   41  OR  CONSOLIDATED  RETURN  INCLUDING  BOTH  THE  TAXPAYER AND THE RELATED
   42  MEMBER WHERE THE REPORTED TRANSACTIONS  BETWEEN  THE  TAXPAYER  AND  THE
   43  RELATED  MEMBER  ARE  ELIMINATED  OR  OFFSET. ALSO, FOR PURPOSES OF THIS
   44  DEFINITION, WHEN COMPUTING THE EFFECTIVE RATE OF TAX FOR A CITY IN WHICH
   45  A RELATED MEMBER'S NET INCOME IS ELIMINATED OR OFFSET  BY  A  CREDIT  OR
   46  SIMILAR  ADJUSTMENT  THAT  IS  DEPENDENT  UPON THE RELATED MEMBER EITHER
   47  MAINTAINING OR  MANAGING  INTANGIBLE  PROPERTY  OR  COLLECTING  INTEREST
   48  INCOME  IN  THAT CITY, THE MAXIMUM STATUTORY RATE OF TAX IMPOSED BY SAID
   49  CITY SHALL BE DECREASED TO  REFLECT  THE  STATUTORY  RATE  OF  TAX  THAT
   50  APPLIES  TO  THE RELATED MEMBER AS EFFECTIVELY REDUCED BY SUCH CREDIT OR
   51  SIMILAR ADJUSTMENT.
   52    (C) Royalty payments. Royalty payments are payments directly connected
   53  to the acquisition, use, maintenance  or  management,  ownership,  sale,
   54  exchange,  or any other disposition of licenses, trademarks, copyrights,
   55  trade names, trade dress, service  marks,  mask  works,  trade  secrets,
   56  patents  and  any other similar types of intangible assets as determined
       S. 2609--A                         32                         A. 3009--A
    1  by the commissioner of finance, and [includes] INCLUDE amounts allowable
    2  as interest deductions under section  one  hundred  sixty-three  of  the
    3  internal  revenue  code to the extent such amounts are directly or indi-
    4  rectly for, related to or in connection with the acquisition, use, main-
    5  tenance  or management, ownership, sale, exchange or disposition of such
    6  intangible assets.
    7    (D) Valid business purpose. A valid business purpose is  one  or  more
    8  business  purposes,  other  than the avoidance or reduction of taxation,
    9  which alone or in combination constitute the primary motivation for some
   10  business activity or transaction, which activity or transaction  changes
   11  in  a  meaningful  way, apart from tax effects, the economic position of
   12  the taxpayer. The economic position of the taxpayer includes an increase
   13  in the market share of the taxpayer, or the entry by the  taxpayer  into
   14  new business markets.
   15    (2)  Royalty expense add backs. (A) For the purpose of computing unin-
   16  corporated business entire net income, a taxpayer must add back  royalty
   17  payments  [to  a]  DIRECTLY  OR INDIRECTLY PAID, ACCRUED, OR INCURRED IN
   18  CONNECTION WITH ONE OR MORE DIRECT OR INDIRECT TRANSACTIONS WITH ONE  OR
   19  MORE  related  [member]  MEMBERS  during  the taxable year to the extent
   20  deductible in calculating federal taxable income.
   21    (B) [The add back of royalty payments shall not be required if and  to
   22  the extent that such payments meet either of the following conditions:
   23    (i)  the related member during the same taxable year directly or indi-
   24  rectly paid or incurred the amount to a person or entity that is  not  a
   25  related  member,  and such transaction was done for a valid business and
   26  the payments are made at arm's length;
   27    (ii) the royalty payments are paid or incurred  to  a  related  member
   28  organized  under the laws of a country other than the United States, are
   29  subject to a comprehensive income tax treaty between  such  country  and
   30  the  United States, and are taxed in such country at a tax rate at least
   31  equal to that imposed by this state.
   32    (3) Royalty income exclusions. For the purpose of computing unincorpo-
   33  rated business entire net income, a taxpayer shall be allowed to  deduct
   34  royalty  payments  directly or indirectly received from a related member
   35  during the taxable year to the extent included in the taxpayer's federal
   36  taxable income unless such royalty payments would not be required to  be
   37  added  back  under  paragraph  two  of this subdivision or other similar
   38  provision in this chapter.] EXCEPTIONS. (I) THE ADJUSTMENT  REQUIRED  IN
   39  THIS  SUBDIVISION  SHALL NOT APPLY TO THE PORTION OF THE ROYALTY PAYMENT
   40  THAT THE TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE  OF  THE
   41  TYPE AND IN THE FORM SPECIFIED BY THE COMMISSIONER OF FINANCE, MEETS ALL
   42  OF THE FOLLOWING REQUIREMENTS: (I) THE RELATED MEMBER WAS SUBJECT TO TAX
   43  IN  THIS  CITY  OR  ANOTHER  CITY  WITHIN THE UNITED STATES OR A FOREIGN
   44  NATION OR SOME COMBINATION THEREOF ON  A  TAX  BASE  THAT  INCLUDED  THE
   45  ROYALTY  PAYMENT  PAID,  ACCRUED  OR  INCURRED BY THE TAXPAYER; (II) THE
   46  RELATED MEMBER DURING THE SAME TAXABLE YEAR DIRECTLY OR INDIRECTLY PAID,
   47  ACCRUED OR INCURRED SUCH PORTION TO A  PERSON  THAT  IS  NOT  A  RELATED
   48  MEMBER;  AND  (III)  THE  TRANSACTION GIVING RISE TO THE ROYALTY PAYMENT
   49  BETWEEN THE TAXPAYER AND THE RELATED MEMBER WAS UNDERTAKEN FOR  A  VALID
   50  BUSINESS PURPOSE.
   51    (II)  THE  ADJUSTMENT  REQUIRED IN THIS SUBDIVISION SHALL NOT APPLY IF
   52  THE TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE OF  THE  TYPE
   53  AND  IN THE FORM SPECIFIED BY THE COMMISSIONER OF FINANCE, THAT: (I) THE
   54  RELATED MEMBER WAS SUBJECT TO TAX ON OR MEASURED BY ITS  NET  INCOME  IN
   55  THIS  CITY OR ANOTHER CITY WITHIN THE UNITED STATES, OR SOME COMBINATION
   56  THEREOF; (II) THE TAX BASE FOR SAID TAX  INCLUDED  THE  ROYALTY  PAYMENT
       S. 2609--A                         33                         A. 3009--A
    1  PAID,  ACCRUED  OR  INCURRED  BY  THE  TAXPAYER; AND (III) THE AGGREGATE
    2  EFFECTIVE RATE OF TAX APPLIED TO THE RELATED MEMBER IN  THOSE  JURISDIC-
    3  TIONS  IS  NO LESS THAN EIGHTY PERCENT OF THE STATUTORY RATE OF TAX THAT
    4  APPLIED  TO  THE  TAXPAYER  UNDER SECTION 11-503 OF THIS CHAPTER FOR THE
    5  TAXABLE YEAR.
    6    (III) THE ADJUSTMENT REQUIRED IN THIS SUBDIVISION SHALL NOT  APPLY  IF
    7  THE  TAXPAYER  ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE OF THE TYPE
    8  AND IN THE FORM SPECIFIED BY THE COMMISSIONER OF FINANCE, THAT: (I)  THE
    9  ROYALTY PAYMENT WAS PAID, ACCRUED OR INCURRED TO A RELATED MEMBER ORGAN-
   10  IZED  UNDER THE LAWS OF A COUNTRY OTHER THAN THE UNITED STATES; (II) THE
   11  RELATED MEMBER'S INCOME FROM THE TRANSACTION WAS SUBJECT TO A COMPREHEN-
   12  SIVE INCOME TAX TREATY BETWEEN SUCH COUNTRY AND THE UNITED STATES; (III)
   13  THE RELATED MEMBER WAS SUBJECT TO TAX IN A FOREIGN NATION ON A TAX  BASE
   14  THAT  INCLUDED  THE  ROYALTY  PAYMENT  PAID,  ACCRUED OR INCURRED BY THE
   15  TAXPAYER; (IV) THE RELATED MEMBER'S  INCOME  FROM  THE  TRANSACTION  WAS
   16  TAXED IN SUCH COUNTRY AT AN EFFECTIVE RATE OF TAX AT LEAST EQUAL TO THAT
   17  IMPOSED  BY  THIS CITY; AND (V) THE ROYALTY PAYMENT WAS PAID, ACCRUED OR
   18  INCURRED PURSUANT TO A TRANSACTION THAT WAS UNDERTAKEN FOR A VALID BUSI-
   19  NESS PURPOSE AND USING TERMS THAT REFLECT AN ARM'S LENGTH RELATIONSHIP.
   20    (IV) THE ADJUSTMENT REQUIRED IN THIS SUBDIVISION SHALL  NOT  APPLY  IF
   21  THE  TAXPAYER  AND  THE  COMMISSIONER OF FINANCE AGREE IN WRITING TO THE
   22  APPLICATION OR USE  OF  ALTERNATIVE  ADJUSTMENTS  OR  COMPUTATIONS.  THE
   23  COMMISSIONER  OF  FINANCE  MAY,  IN  HIS OR HER DISCRETION, AGREE TO THE
   24  APPLICATION OR USE OF ALTERNATIVE ADJUSTMENTS OR COMPUTATIONS WHEN HE OR
   25  SHE CONCLUDES THAT IN THE ABSENCE OF SUCH AGREEMENT THE  INCOME  OF  THE
   26  TAXPAYER WOULD NOT BE PROPERLY REFLECTED.
   27    S 10. Paragraph (n) of subdivision 8 of section 11-602 of the adminis-
   28  trative code of the city of New York, as amended by section 19 of part M
   29  of chapter 686 of the laws of 2003, is amended to read as follows:
   30    (n)  Related  members  expense  add back [and income exclusion].   (1)
   31  Definitions. (A) Related member [or members. For purposes of this  para-
   32  graph,  the  term related member or members means a person, corporation,
   33  or other entity, including an entity that is treated as a partnership or
   34  other pass-through vehicle for purposes  of  federal  taxation,  whether
   35  such  person, corporation or entity is a taxpayer or not, where one such
   36  person, corporation, or entity, or set of related persons,  corporations
   37  or  entities,  directly  or  indirectly  owns  or controls a controlling
   38  interest in another entity. Such entity  or  entities  may  include  all
   39  taxpayers  under this title]. "RELATED MEMBER" MEANS A RELATED PERSON AS
   40  DEFINED IN SUBPARAGRAPH (C) OF PARAGRAPH  THREE  OF  SUBSECTION  (B)  OF
   41  SECTION  FOUR  HUNDRED  SIXTY-FIVE  OF THE INTERNAL REVENUE CODE, EXCEPT
   42  THAT "FIFTY PERCENT" SHALL BE SUBSTITUTED FOR "TEN PERCENT".
   43    (B) [Controlling interest. A controlling interest shall  mean  (i)  in
   44  the  case  of  a corporation, either thirty percent or more of the total
   45  combined voting power of all classes of stock of  such  corporation,  or
   46  thirty percent or more of the capital, profits or beneficial interest in
   47  such  voting  stock of such corporation, and (ii) in the case of a part-
   48  nership, association, trust or other entity, thirty percent or  more  of
   49  the capital, profits or beneficial interest in such partnership, associ-
   50  ation, trust or other entity.] EFFECTIVE RATE OF TAX. "EFFECTIVE RATE OF
   51  TAX" MEANS, AS TO ANY CITY, THE MAXIMUM STATUTORY RATE OF TAX IMPOSED BY
   52  THE  CITY  ON OR MEASURED BY A RELATED MEMBER'S NET INCOME MULTIPLIED BY
   53  THE APPORTIONMENT PERCENTAGE, IF ANY, APPLICABLE TO THE  RELATED  MEMBER
   54  UNDER  THE  LAWS  OF SAID JURISDICTION. FOR PURPOSES OF THIS DEFINITION,
   55  THE EFFECTIVE RATE OF TAX AS TO ANY  CITY  IS  ZERO  WHERE  THE  RELATED
   56  MEMBER'S NET INCOME TAX LIABILITY IN SAID CITY IS REPORTED ON A COMBINED
       S. 2609--A                         34                         A. 3009--A
    1  OR  CONSOLIDATED  RETURN  INCLUDING  BOTH  THE  TAXPAYER AND THE RELATED
    2  MEMBER WHERE THE REPORTED TRANSACTIONS  BETWEEN  THE  TAXPAYER  AND  THE
    3  RELATED  MEMBER  ARE  ELIMINATED  OR  OFFSET. ALSO, FOR PURPOSES OF THIS
    4  DEFINITION, WHEN COMPUTING THE EFFECTIVE RATE OF TAX FOR A CITY IN WHICH
    5  A  RELATED  MEMBER'S  NET  INCOME IS ELIMINATED OR OFFSET BY A CREDIT OR
    6  SIMILAR ADJUSTMENT THAT IS DEPENDENT  UPON  THE  RELATED  MEMBER  EITHER
    7  MAINTAINING  OR  MANAGING  INTANGIBLE  PROPERTY  OR  COLLECTING INTEREST
    8  INCOME IN THAT CITY, THE MAXIMUM STATUTORY RATE OF TAX IMPOSED  BY  SAID
    9  CITY  SHALL  BE  DECREASED  TO  REFLECT  THE  STATUTORY RATE OF TAX THAT
   10  APPLIES TO THE RELATED MEMBER AS EFFECTIVELY REDUCED BY SUCH  CREDIT  OR
   11  SIMILAR ADJUSTMENT.
   12    (C) Royalty payments. Royalty payments are payments directly connected
   13  to  the  acquisition,  use,  maintenance or management, ownership, sale,
   14  exchange, or any other disposition of licenses, trademarks,  copyrights,
   15  trade  names,  trade  dress,  service  marks, mask works, trade secrets,
   16  patents and any other similar types of intangible assets  as  determined
   17  by the commissioner of finance, and [includes] INCLUDE amounts allowable
   18  as  interest  deductions  under  section  one hundred sixty-three of the
   19  internal revenue code to the extent such amounts are directly  or  indi-
   20  rectly for, related to or in connection with the acquisition, use, main-
   21  tenance  or management, ownership, sale, exchange or disposition of such
   22  intangible assets.
   23    (D) Valid business purpose. A valid business purpose is  one  or  more
   24  business  purposes,  other  than the avoidance or reduction of taxation,
   25  which alone or in combination constitute the primary motivation for some
   26  business activity or transaction, which activity or transaction  changes
   27  in  a  meaningful  way, apart from tax effects, the economic position of
   28  the taxpayer. The economic position of the taxpayer includes an increase
   29  in the market share of the taxpayer, or the entry by the  taxpayer  into
   30  new business markets.
   31    (2) Royalty expense add backs. (A) For the purpose of computing entire
   32  net  income  or other applicable taxable basis, a taxpayer must add back
   33  royalty payments  [to  a]  DIRECTLY  OR  INDIRECTLY  PAID,  ACCRUED,  OR
   34  INCURRED  IN CONNECTION WITH ONE OR MORE DIRECT OR INDIRECT TRANSACTIONS
   35  WITH ONE OR MORE related [member] MEMBERS during the taxable year to the
   36  extent deductible in calculating federal taxable income.
   37    (B) [The add back of royalty payments shall not be required if and  to
   38  the extent that such payments meet either of the following conditions:
   39    (i)  the related member during the same taxable year directly or indi-
   40  rectly paid or incurred the amount to a person or entity that is  not  a
   41  related  member,  and  such  transaction  was  done for a valid business
   42  purpose and the payments are made at arm's length;
   43    (ii) the royalty payments are paid or incurred  to  a  related  member
   44  organized  under the laws of a country other than the United States, are
   45  subject to a comprehensive income tax treaty between  such  country  and
   46  the  United States, and are taxed in such country at a tax rate at least
   47  equal to that imposed by this state.
   48    (3) Royalty income exclusions. For the purpose of computing entire net
   49  income or other taxable basis, a taxpayer shall  be  allowed  to  deduct
   50  royalty  payments  directly or indirectly received from a related member
   51  during the taxable year to the extent included in the taxpayer's federal
   52  taxable income unless such royalty payments would not be required to  be
   53  added  back  under  subparagraph  two of this paragraph or other similar
   54  provision in this chapter.] EXCEPTIONS. (I) THE ADJUSTMENT  REQUIRED  IN
   55  THIS  PARAGRAPH  SHALL  NOT  APPLY TO THE PORTION OF THE ROYALTY PAYMENT
   56  THAT THE TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE  OF  THE
       S. 2609--A                         35                         A. 3009--A
    1  TYPE AND IN THE FORM SPECIFIED BY THE COMMISSIONER OF FINANCE, MEETS ALL
    2  OF THE FOLLOWING REQUIREMENTS: (I) THE RELATED MEMBER WAS SUBJECT TO TAX
    3  IN  THIS  CITY  OR  ANOTHER  CITY  WITHIN THE UNITED STATES OR A FOREIGN
    4  NATION  OR  SOME  COMBINATION  THEREOF  ON  A TAX BASE THAT INCLUDED THE
    5  ROYALTY PAYMENT PAID, ACCRUED OR INCURRED  BY  THE  TAXPAYER;  (II)  THE
    6  RELATED MEMBER DURING THE SAME TAXABLE YEAR DIRECTLY OR INDIRECTLY PAID,
    7  ACCRUED  OR  INCURRED  SUCH  PORTION  TO  A PERSON THAT IS NOT A RELATED
    8  MEMBER; AND (III) THE TRANSACTION GIVING RISE  TO  THE  ROYALTY  PAYMENT
    9  BETWEEN  THE  TAXPAYER AND THE RELATED MEMBER WAS UNDERTAKEN FOR A VALID
   10  BUSINESS PURPOSE.
   11    (II) THE ADJUSTMENT REQUIRED IN THIS PARAGRAPH SHALL NOT APPLY IF  THE
   12  TAXPAYER  ESTABLISHES,  BY CLEAR AND CONVINCING EVIDENCE OF THE TYPE AND
   13  IN THE FORM SPECIFIED BY THE COMMISSIONER  OF  FINANCE,  THAT:  (I)  THE
   14  RELATED  MEMBER  WAS  SUBJECT TO TAX ON OR MEASURED BY ITS NET INCOME IN
   15  THIS CITY OR ANOTHER CITY WITHIN THE UNITED STATES, OR SOME  COMBINATION
   16  THEREOF;  (II)  THE  TAX  BASE FOR SAID TAX INCLUDED THE ROYALTY PAYMENT
   17  PAID, ACCRUED OR INCURRED BY  THE  TAXPAYER;  AND  (III)  THE  AGGREGATE
   18  EFFECTIVE  RATE  OF TAX APPLIED TO THE RELATED MEMBER IN THOSE JURISDIC-
   19  TIONS IS NO LESS THAN EIGHTY PERCENT OF THE STATUTORY RATE OF  TAX  THAT
   20  APPLIED  TO THE TAXPAYER UNDER SECTION 11-604 OF THIS SUBCHAPTER FOR THE
   21  TAXABLE YEAR.
   22    (III) THE ADJUSTMENT REQUIRED IN THIS PARAGRAPH SHALL NOT APPLY IF THE
   23  TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE OF THE  TYPE  AND
   24  IN  THE  FORM  SPECIFIED  BY  THE COMMISSIONER OF FINANCE, THAT: (I) THE
   25  ROYALTY PAYMENT WAS PAID, ACCRUED OR INCURRED TO A RELATED MEMBER ORGAN-
   26  IZED UNDER THE LAWS OF A COUNTRY OTHER THAN THE UNITED STATES; (II)  THE
   27  RELATED MEMBER'S INCOME FROM THE TRANSACTION WAS SUBJECT TO A COMPREHEN-
   28  SIVE INCOME TAX TREATY BETWEEN SUCH COUNTRY AND THE UNITED STATES; (III)
   29  THE  RELATED MEMBER WAS SUBJECT TO TAX IN A FOREIGN NATION ON A TAX BASE
   30  THAT INCLUDED THE ROYALTY PAYMENT  PAID,  ACCRUED  OR  INCURRED  BY  THE
   31  TAXPAYER;  (IV)  THE  RELATED  MEMBER'S  INCOME FROM THE TRANSACTION WAS
   32  TAXED IN SUCH COUNTRY AT AN EFFECTIVE RATE OF TAX AT LEAST EQUAL TO THAT
   33  IMPOSED BY THIS CITY; AND (V) THE ROYALTY PAYMENT WAS PAID,  ACCRUED  OR
   34  INCURRED PURSUANT TO A TRANSACTION THAT WAS UNDERTAKEN FOR A VALID BUSI-
   35  NESS PURPOSE AND USING TERMS THAT REFLECT AN ARM'S LENGTH RELATIONSHIP.
   36    (IV)  THE ADJUSTMENT REQUIRED IN THIS PARAGRAPH SHALL NOT APPLY IF THE
   37  TAXPAYER AND THE COMMISSIONER OF FINANCE AGREE IN WRITING TO THE  APPLI-
   38  CATION  OR  USE  OF ALTERNATIVE ADJUSTMENTS OR COMPUTATIONS. THE COMMIS-
   39  SIONER OF FINANCE MAY, IN HIS OR HER DISCRETION, AGREE TO  THE  APPLICA-
   40  TION  OR  USE  OF ALTERNATIVE ADJUSTMENTS OR COMPUTATIONS WHEN HE OR SHE
   41  CONCLUDES THAT IN THE ABSENCE  OF  SUCH  AGREEMENT  THE  INCOME  OF  THE
   42  TAXPAYER WOULD NOT BE PROPERLY REFLECTED.
   43    S  11. Subdivision (q) of section 11-641 of the administrative code of
   44  the city of New York, as added by section 21 of part M of chapter 686 of
   45  the laws of 2003, is amended to read as follows:
   46    (q) Related members expense add back  [and  income  exclusion].    (1)
   47  Definitions. (A) Related member [or members. For purposes of this subdi-
   48  vision,  the term related member or members means a person, corporation,
   49  or other entity, including an entity that is treated as a partnership or
   50  other pass-through vehicle for purposes  of  federal  taxation,  whether
   51  such  person, corporation or entity is a taxpayer or not, where one such
   52  person, corporation, or entity, or set of related persons,  corporations
   53  or  entities,  directly  or  indirectly  owns  or controls a controlling
   54  interest in another entity. Such entity  or  entities  may  include  all
   55  taxpayers under this title].  "RELATED MEMBER" MEANS A RELATED PERSON AS
   56  DEFINED  IN  SUBPARAGRAPH  (C)  OF  PARAGRAPH THREE OF SUBSECTION (B) OF
       S. 2609--A                         36                         A. 3009--A
    1  SECTION FOUR HUNDRED SIXTY-FIVE OF THE  INTERNAL  REVENUE  CODE,  EXCEPT
    2  THAT "FIFTY PERCENT" SHALL BE SUBSTITUTED FOR "TEN PERCENT".
    3    (B)  [Controlling  interest.  A controlling interest shall mean (i) in
    4  the case of a corporation, either thirty percent or more  of  the  total
    5  combined  voting  power  of all classes of stock of such corporation, or
    6  thirty percent or more of the capital, profits or beneficial interest in
    7  such voting stock of such corporation, and (ii) in the case of  a  part-
    8  nership,  association,  trust or other entity, thirty percent or more of
    9  the capital, profits or beneficial interest in such partnership, associ-
   10  ation, trust or other entity.] EFFECTIVE RATE OF TAX.   "EFFECTIVE  RATE
   11  OF TAX" MEANS, AS TO ANY CITY, THE MAXIMUM STATUTORY RATE OF TAX IMPOSED
   12  BY  THE  CITY ON OR MEASURED BY A RELATED MEMBER'S NET INCOME MULTIPLIED
   13  BY THE APPORTIONMENT PERCENTAGE,  IF  ANY,  APPLICABLE  TO  THE  RELATED
   14  MEMBER  UNDER  THE LAWS OF SAID JURISDICTION. FOR PURPOSES OF THIS DEFI-
   15  NITION, THE EFFECTIVE RATE OF TAX AS TO  ANY  CITY  IS  ZERO  WHERE  THE
   16  RELATED  MEMBER'S NET INCOME TAX LIABILITY IN SAID CITY IS REPORTED ON A
   17  COMBINED OR CONSOLIDATED RETURN INCLUDING  BOTH  THE  TAXPAYER  AND  THE
   18  RELATED  MEMBER WHERE THE REPORTED TRANSACTIONS BETWEEN THE TAXPAYER AND
   19  THE RELATED MEMBER ARE ELIMINATED OR OFFSET. ALSO, FOR PURPOSES OF  THIS
   20  DEFINITION, WHEN COMPUTING THE EFFECTIVE RATE OF TAX FOR A CITY IN WHICH
   21  A  RELATED  MEMBER'S  NET  INCOME IS ELIMINATED OR OFFSET BY A CREDIT OR
   22  SIMILAR ADJUSTMENT THAT IS DEPENDENT  UPON  THE  RELATED  MEMBER  EITHER
   23  MAINTAINING  OR  MANAGING  INTANGIBLE  PROPERTY  OR  COLLECTING INTEREST
   24  INCOME IN THAT CITY, THE MAXIMUM STATUTORY RATE OF TAX IMPOSED  BY  SAID
   25  CITY  SHALL  BE  DECREASED  TO  REFLECT  THE  STATUTORY RATE OF TAX THAT
   26  APPLIES TO THE RELATED MEMBER AS EFFECTIVELY REDUCED BY SUCH  CREDIT  OR
   27  SIMILAR ADJUSTMENT.
   28    (C) Royalty payments. Royalty payments are payments directly connected
   29  to  the  acquisition,  use,  maintenance or management, ownership, sale,
   30  exchange, or any other disposition of licenses, trademarks,  copyrights,
   31  trade  names,  trade  dress,  service  marks, mask works, trade secrets,
   32  patents and any other similar types of intangible assets  as  determined
   33  by the commissioner of finance, and [includes] INCLUDE amounts allowable
   34  as  interest  deductions  under  section  one hundred sixty-three of the
   35  internal revenue code to the extent such amounts are directly  or  indi-
   36  rectly for, related to or in connection with the acquisition, use, main-
   37  tenance  or management, ownership, sale, exchange or disposition of such
   38  intangible assets.
   39    (D) Valid business purpose. A valid business purpose is  one  or  more
   40  business  purposes,  other  than the avoidance or reduction of taxation,
   41  which alone or in combination constitute the primary motivation for some
   42  business activity or transaction, which activity or transaction  changes
   43  in  a  meaningful  way, apart from tax effects, the economic position of
   44  the taxpayer. The economic position of the taxpayer includes an increase
   45  in the market share of the taxpayer, or the entry by the  taxpayer  into
   46  new business markets.
   47    (2) Royalty expense add backs. (A) For the purpose of computing entire
   48  net income, a taxpayer must add back royalty payments [to a] DIRECTLY OR
   49  INDIRECTLY  PAID,  ACCRUED,  OR  INCURRED IN CONNECTION WITH ONE OR MORE
   50  DIRECT OR INDIRECT  TRANSACTIONS  WITH  ONE  OR  MORE  related  [member]
   51  MEMBERS  during the taxable year to the extent deductible in calculating
   52  federal taxable income.
   53    (B) [The add back of royalty payments shall not be required if and  to
   54  the extent that such payments meet either of the following conditions:
   55    (i)  the related member during the same taxable year directly or indi-
   56  rectly paid or incurred the amount to a person or entity that is  not  a
       S. 2609--A                         37                         A. 3009--A
    1  related  member,  and such transaction was done for a valid business and
    2  the payments are made at arm's length;
    3    (ii)  the  royalty  payments  are paid or incurred to a related member
    4  organized under the laws of a country other than the United States,  are
    5  subject  to  a  comprehensive income tax treaty between such country and
    6  the United States, and are taxed in such country at a tax rate at  least
    7  equal to that imposed by this state.
    8    (3) Royalty income exclusions. For the purpose of computing entire net
    9  income,  a taxpayer shall be allowed to deduct royalty payments directly
   10  or indirectly received from a related member during the taxable year  to
   11  the extent included in the taxpayer's federal taxable income unless such
   12  royalty  payments would not be required to be added back under paragraph
   13  two of this subdivision or other similar  provision  in  this  chapter.]
   14  EXCEPTIONS.  (I)  THE  ADJUSTMENT REQUIRED IN THIS SUBDIVISION SHALL NOT
   15  APPLY TO THE PORTION OF THE ROYALTY PAYMENT  THAT  THE  TAXPAYER  ESTAB-
   16  LISHES,  BY  CLEAR  AND  CONVINCING EVIDENCE OF THE TYPE AND IN THE FORM
   17  SPECIFIED BY THE COMMISSIONER OF FINANCE, MEETS  ALL  OF  THE  FOLLOWING
   18  REQUIREMENTS:  (I) THE RELATED MEMBER WAS SUBJECT TO TAX IN THIS CITY OR
   19  ANOTHER CITY WITHIN THE UNITED STATES OR A FOREIGN NATION OR SOME COMBI-
   20  NATION THEREOF ON A TAX BASE THAT INCLUDED  THE  ROYALTY  PAYMENT  PAID,
   21  ACCRUED  OR INCURRED BY THE TAXPAYER; (II) THE RELATED MEMBER DURING THE
   22  SAME TAXABLE YEAR DIRECTLY OR INDIRECTLY PAID, ACCRUED OR INCURRED  SUCH
   23  PORTION  TO  A PERSON THAT IS NOT A RELATED MEMBER; AND (III) THE TRANS-
   24  ACTION GIVING RISE TO THE ROYALTY PAYMENT BETWEEN THE TAXPAYER  AND  THE
   25  RELATED MEMBER WAS UNDERTAKEN FOR A VALID BUSINESS PURPOSE.
   26    (II)  THE  ADJUSTMENT  REQUIRED IN THIS SUBDIVISION SHALL NOT APPLY IF
   27  THE TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE OF  THE  TYPE
   28  AND  IN THE FORM SPECIFIED BY THE COMMISSIONER OF FINANCE, THAT: (I) THE
   29  RELATED MEMBER WAS SUBJECT TO TAX ON OR MEASURED BY ITS  NET  INCOME  IN
   30  THIS  CITY OR ANOTHER CITY WITHIN THE UNITED STATES, OR SOME COMBINATION
   31  THEREOF; (II) THE TAX BASE FOR SAID TAX  INCLUDED  THE  ROYALTY  PAYMENT
   32  PAID,  ACCRUED  OR  INCURRED  BY  THE  TAXPAYER; AND (III) THE AGGREGATE
   33  EFFECTIVE RATE OF TAX APPLIED TO THE RELATED MEMBER IN  THOSE  JURISDIC-
   34  TIONS  IS  NO LESS THAN EIGHTY PERCENT OF THE STATUTORY RATE OF TAX THAT
   35  APPLIED TO THE TAXPAYER UNDER SECTION 11-643.5  OF  THIS  PART  FOR  THE
   36  TAXABLE YEAR.
   37    (III)  THE  ADJUSTMENT REQUIRED IN THIS SUBDIVISION SHALL NOT APPLY IF
   38  THE TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE OF  THE  TYPE
   39  AND  IN THE FORM SPECIFIED BY THE COMMISSIONER OF FINANCE, THAT: (I) THE
   40  ROYALTY PAYMENT WAS PAID, ACCRUED OR INCURRED TO A RELATED MEMBER ORGAN-
   41  IZED UNDER THE LAWS OF A COUNTRY OTHER THAN THE UNITED STATES; (II)  THE
   42  RELATED MEMBER'S INCOME FROM THE TRANSACTION WAS SUBJECT TO A COMPREHEN-
   43  SIVE INCOME TAX TREATY BETWEEN SUCH COUNTRY AND THE UNITED STATES; (III)
   44  THE  RELATED MEMBER WAS SUBJECT TO TAX IN A FOREIGN NATION ON A TAX BASE
   45  THAT INCLUDED THE ROYALTY PAYMENT  PAID,  ACCRUED  OR  INCURRED  BY  THE
   46  TAXPAYER;  (IV)  THE  RELATED  MEMBER'S  INCOME FROM THE TRANSACTION WAS
   47  TAXED IN SUCH COUNTRY AT AN EFFECTIVE RATE OF TAX AT LEAST EQUAL TO THAT
   48  IMPOSED BY THIS CITY; AND (V) THE ROYALTY PAYMENT WAS PAID,  ACCRUED  OR
   49  INCURRED PURSUANT TO A TRANSACTION THAT WAS UNDERTAKEN FOR A VALID BUSI-
   50  NESS PURPOSE AND USING TERMS THAT REFLECT AN ARM'S LENGTH RELATIONSHIP.
   51    (IV)  THE  ADJUSTMENT  REQUIRED IN THIS SUBDIVISION SHALL NOT APPLY IF
   52  THE TAXPAYER AND THE COMMISSIONER OF FINANCE AGREE  IN  WRITING  TO  THE
   53  APPLICATION  OR  USE  OF  ALTERNATIVE  ADJUSTMENTS  OR COMPUTATIONS. THE
   54  COMMISSIONER OF FINANCE MAY, IN HIS OR  HER  DISCRETION,  AGREE  TO  THE
   55  APPLICATION OR USE OF ALTERNATIVE ADJUSTMENTS OR COMPUTATIONS WHEN HE OR
       S. 2609--A                         38                         A. 3009--A
    1  SHE  CONCLUDES  THAT  IN THE ABSENCE OF SUCH AGREEMENT THE INCOME OF THE
    2  TAXPAYER WOULD NOT BE PROPERLY REFLECTED.
    3    S 12. Subdivision (t) of section 11-1712 of the administrative code of
    4  the city of New York, as added by section 26 of part M of chapter 686 of
    5  the laws of 2003, is amended to read as follows:
    6    (t)  Related  members  expense  add back [and income exclusion].   (1)
    7  Definitions. (A) Related member [or members. For purposes of this subdi-
    8  vision, the term related member or members means a person,  corporation,
    9  or other entity, including an entity that is treated as a partnership or
   10  other  pass-through  vehicle  for  purposes of federal taxation, whether
   11  such person, corporation or entity is a taxpayer or not, where one  such
   12  person,  corporation  or entity, or set of related persons, corporations
   13  or entities, directly or  indirectly  owns  or  controls  a  controlling
   14  interest  in  another  entity.  Such  entity or entities may include all
   15  taxpayers under this title].  "RELATED MEMBER" MEANS A RELATED PERSON AS
   16  DEFINED IN SUBPARAGRAPH (C) OF PARAGRAPH  THREE  OF  SUBSECTION  (B)  OF
   17  SECTION  FOUR  HUNDRED  SIXTY-FIVE  OF THE INTERNAL REVENUE CODE, EXCEPT
   18  THAT "FIFTY PERCENT" SHALL BE SUBSTITUTED FOR "TEN PERCENT".
   19    (B) [Controlling interest. A controlling interest shall  mean  (i)  in
   20  the  case  of  a corporation, either thirty percent or more of the total
   21  combined voting power of all classes of stock of  such  corporation,  or
   22  thirty percent or more of the capital, profits or beneficial interest in
   23  such  voting  stock of such corporation, and (ii) in the case of a part-
   24  nership, association, trust or other entity, thirty percent or  more  of
   25  the capital, profits or beneficial interest in such partnership, associ-
   26  ation, trust or other entity.] EFFECTIVE RATE OF TAX. "EFFECTIVE RATE OF
   27  TAX" MEANS, AS TO ANY CITY, THE MAXIMUM STATUTORY RATE OF TAX IMPOSED BY
   28  THE  CITY  ON OR MEASURED BY A RELATED MEMBER'S NET INCOME MULTIPLIED BY
   29  THE APPORTIONMENT PERCENTAGE, IF ANY, APPLICABLE TO THE  RELATED  MEMBER
   30  UNDER  THE  LAWS  OF SAID JURISDICTION. FOR PURPOSES OF THIS DEFINITION,
   31  THE EFFECTIVE RATE OF TAX AS TO ANY  CITY  IS  ZERO  WHERE  THE  RELATED
   32  MEMBER'S NET INCOME TAX LIABILITY IN SAID CITY IS REPORTED ON A COMBINED
   33  OR  CONSOLIDATED  RETURN  INCLUDING  BOTH  THE  TAXPAYER AND THE RELATED
   34  MEMBER WHERE THE REPORTED TRANSACTIONS  BETWEEN  THE  TAXPAYER  AND  THE
   35  RELATED  MEMBER  ARE  ELIMINATED  OR  OFFSET. ALSO, FOR PURPOSES OF THIS
   36  DEFINITION, WHEN COMPUTING THE EFFECTIVE RATE OF TAX FOR A CITY IN WHICH
   37  A RELATED MEMBER'S NET INCOME IS ELIMINATED OR OFFSET  BY  A  CREDIT  OR
   38  SIMILAR  ADJUSTMENT  THAT  IS  DEPENDENT  UPON THE RELATED MEMBER EITHER
   39  MAINTAINING OR  MANAGING  INTANGIBLE  PROPERTY  OR  COLLECTING  INTEREST
   40  INCOME  IN  THAT CITY, THE MAXIMUM STATUTORY RATE OF TAX IMPOSED BY SAID
   41  CITY SHALL BE DECREASED TO  REFLECT  THE  STATUTORY  RATE  OF  TAX  THAT
   42  APPLIES  TO  THE RELATED MEMBER AS EFFECTIVELY REDUCED BY SUCH CREDIT OR
   43  SIMILAR ADJUSTMENT.
   44    (C) Royalty payments. Royalty payments are payments directly connected
   45  to the acquisition, use, maintenance  or  management,  ownership,  sale,
   46  exchange,  or any other disposition of licenses, trademarks, copyrights,
   47  trade names, trade dress, service  marks,  mask  works,  trade  secrets,
   48  patents  and  any other similar types of intangible assets as determined
   49  by the state  commissioner  of  taxation  and  finance,  and  [includes]
   50  INCLUDE  amounts  allowable  as  interest  deductions  under section one
   51  hundred sixty-three of the internal revenue  code  to  the  extent  such
   52  amounts are directly or indirectly for, related to or in connection with
   53  the  acquisition,  use,  maintenance  or  management,  ownership,  sale,
   54  exchange or disposition of such intangible assets.
   55    (D) Valid business purpose. A valid business purpose is  one  or  more
   56  business  purposes,  other  than the avoidance or reduction of taxation,
       S. 2609--A                         39                         A. 3009--A
    1  which alone or in combination constitute the primary motivation for some
    2  business activity or transaction, which activity or transaction  changes
    3  in  a  meaningful  way, apart from tax effects, the economic position of
    4  the taxpayer. The economic position of the taxpayer includes an increase
    5  in  the  market share of the taxpayer, or the entry by the taxpayer into
    6  new business markets.
    7    (2) Royalty expense add backs. (A) For the purpose of  computing  city
    8  adjusted  gross income, a taxpayer must add back royalty payments [to a]
    9  DIRECTLY OR INDIRECTLY PAID, ACCRUED, OR INCURRED IN CONNECTION WITH ONE
   10  OR MORE DIRECT  OR  INDIRECT  TRANSACTIONS  WITH  ONE  OR  MORE  related
   11  [member]  MEMBERS  during  the  taxable year to the extent deductible in
   12  calculating federal taxable income.
   13    (B) [The add back of royalty payments shall not be required if and  to
   14  the extent that such payments meet either of the following conditions:
   15    (i)  the related member during the same taxable year directly or indi-
   16  rectly paid or incurred the amount to a person or entity that is  not  a
   17  related  member,  and such transaction was done for a valid business and
   18  the payments are made at arm's length;
   19    (ii) the royalty payments are paid or incurred  to  a  related  member
   20  organized  under the laws of a country other than the United States, are
   21  subject to a comprehensive income tax treaty between  such  country  and
   22  the  United States, and are taxed in such country at a tax rate at least
   23  equal to that imposed by this state.
   24    (3) Royalty income exclusions. (A) For the purpose of  computing  city
   25  adjusted  gross  income,  a  taxpayer shall be allowed to deduct royalty
   26  payments directly or indirectly received from a  related  member  during
   27  the  taxable year to the extent included in the taxpayer's federal taxa-
   28  ble income unless such royalty payments would  not  be  required  to  be
   29  added  back  under  paragraph  two  of this subdivision or other similar
   30  provision in this title.] EXCEPTIONS.   (I) THE ADJUSTMENT  REQUIRED  IN
   31  THIS  SUBDIVISION  SHALL NOT APPLY TO THE PORTION OF THE ROYALTY PAYMENT
   32  THAT THE TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE  OF  THE
   33  TYPE AND IN THE FORM SPECIFIED BY THE COMMISSIONER OF FINANCE, MEETS ALL
   34  OF THE FOLLOWING REQUIREMENTS: (I) THE RELATED MEMBER WAS SUBJECT TO TAX
   35  IN  THIS  CITY  OR  ANOTHER  CITY  WITHIN THE UNITED STATES OR A FOREIGN
   36  NATION OR SOME COMBINATION THEREOF ON  A  TAX  BASE  THAT  INCLUDED  THE
   37  ROYALTY  PAYMENT  PAID,  ACCRUED  OR  INCURRED BY THE TAXPAYER; (II) THE
   38  RELATED MEMBER DURING THE SAME TAXABLE YEAR DIRECTLY OR INDIRECTLY PAID,
   39  ACCRUED OR INCURRED SUCH PORTION TO A  PERSON  THAT  IS  NOT  A  RELATED
   40  MEMBER;  AND  (III)  THE  TRANSACTION GIVING RISE TO THE ROYALTY PAYMENT
   41  BETWEEN THE TAXPAYER AND THE RELATED MEMBER WAS UNDERTAKEN FOR  A  VALID
   42  BUSINESS PURPOSE.
   43    (II)  THE  ADJUSTMENT  REQUIRED IN THIS SUBDIVISION SHALL NOT APPLY IF
   44  THE TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE OF  THE  TYPE
   45  AND  IN THE FORM SPECIFIED BY THE COMMISSIONER OF FINANCE, THAT: (I) THE
   46  RELATED MEMBER WAS SUBJECT TO TAX ON OR MEASURED BY ITS  NET  INCOME  IN
   47  THIS  CITY OR ANOTHER CITY WITHIN THE UNITED STATES, OR SOME COMBINATION
   48  THEREOF; (II) THE TAX BASE FOR SAID TAX   INCLUDED THE  ROYALTY  PAYMENT
   49  PAID,  ACCRUED  OR  INCURRED  BY  THE  TAXPAYER; AND (III) THE AGGREGATE
   50  EFFECTIVE RATE OF TAX APPLIED TO THE RELATED MEMBER IN  THOSE  JURISDIC-
   51  TIONS  IS  NO LESS THAN EIGHTY PERCENT OF THE STATUTORY RATE OF TAX THAT
   52  APPLIED TO THE TAXPAYER UNDER SECTION 11-1701 OF THIS  CHAPTER  FOR  THE
   53  TAXABLE YEAR.
   54    (III)  THE  ADJUSTMENT REQUIRED IN THIS SUBDIVISION SHALL NOT APPLY IF
   55  THE TAXPAYER ESTABLISHES, BY CLEAR AND CONVINCING EVIDENCE OF  THE  TYPE
   56  AND  IN THE FORM SPECIFIED BY THE COMMISSIONER OF FINANCE, THAT: (I) THE
       S. 2609--A                         40                         A. 3009--A
    1  ROYALTY PAYMENT WAS PAID, ACCRUED OR INCURRED TO A RELATED MEMBER ORGAN-
    2  IZED UNDER THE LAWS OF A COUNTRY OTHER THAN THE UNITED STATES; (II)  THE
    3  RELATED MEMBER'S INCOME FROM THE TRANSACTION WAS SUBJECT TO A COMPREHEN-
    4  SIVE INCOME TAX TREATY BETWEEN SUCH COUNTRY AND THE UNITED STATES; (III)
    5  THE  RELATED MEMBER WAS SUBJECT TO TAX IN A FOREIGN NATION ON A TAX BASE
    6  THAT INCLUDED THE ROYALTY PAYMENT  PAID,  ACCRUED  OR  INCURRED  BY  THE
    7  TAXPAYER;  (IV)  THE  RELATED  MEMBER'S  INCOME FROM THE TRANSACTION WAS
    8  TAXED IN SUCH COUNTRY AT AN EFFECTIVE RATE OF TAX AT LEAST EQUAL TO THAT
    9  IMPOSED BY THIS CITY; AND (V) THE ROYALTY PAYMENT WAS PAID,  ACCRUED  OR
   10  INCURRED PURSUANT TO A TRANSACTION THAT WAS UNDERTAKEN FOR A VALID BUSI-
   11  NESS PURPOSE AND USING TERMS THAT REFLECT AN ARM'S LENGTH RELATIONSHIP.
   12    (IV)  THE  ADJUSTMENT  REQUIRED IN THIS SUBDIVISION SHALL NOT APPLY IF
   13  THE TAXPAYER AND THE COMMISSIONER OF FINANCE AGREE  IN  WRITING  TO  THE
   14  APPLICATION  OR  USE  OF  ALTERNATIVE  ADJUSTMENTS  OR COMPUTATIONS. THE
   15  COMMISSIONER OF FINANCE MAY, IN HIS OR  HER  DISCRETION,  AGREE  TO  THE
   16  APPLICATION OR USE OF ALTERNATIVE ADJUSTMENTS OR COMPUTATIONS WHEN HE OR
   17  SHE  CONCLUDES  THAT  IN THE ABSENCE OF SUCH AGREEMENT THE INCOME OF THE
   18  TAXPAYER WOULD NOT BE PROPERLY REFLECTED.
   19    S 13. This act shall take effect immediately and shall apply to  taxa-
   20  ble years beginning on or after January 1, 2013.
   21                                   PART F
   22    Section 1. Subparagraph (A) of paragraph 1,  and paragraphs 4 and 5 of
   23  subsection (oo) of section 606 of the tax law, subparagraph (A) of para-
   24  graph 1 as amended by chapter 472 of the laws of 2010 and paragraph 4 as
   25  amended and paragraph 5 as added by chapter 239 of the laws of 2009, are
   26  amended to read as follows:
   27    (A)  For  taxable years beginning on or after January first, two thou-
   28  sand ten and before January first,  two  thousand  [fifteen]  TWENTY,  a
   29  taxpayer  shall be allowed a credit as hereinafter provided, against the
   30  tax imposed by this article, in an amount equal to one  hundred  percent
   31  of the amount of credit allowed the taxpayer with respect to a certified
   32  historic structure under subsection (a) (2) of section 47 of the federal
   33  internal  revenue  code  with  respect to a certified historic structure
   34  located within the state. Provided, however, the credit shall not exceed
   35  five million dollars. For taxable years beginning on  or  after  January
   36  first,  two  thousand  [fifteen]  TWENTY,  a taxpayer shall be allowed a
   37  credit as hereinafter provided, against the tax imposed by this article,
   38  in an amount equal to thirty percent of the amount of credit allowed the
   39  taxpayer with respect to a certified historic structure under subsection
   40  (a)(2) of section 47 of the federal internal revenue code  with  respect
   41  to  a  certified  historic structure located within the state; provided,
   42  however, the credit shall not exceed one hundred thousand dollars.
   43    (4) If the amount of the credit [allowable under this  subsection  for
   44  any  taxable  year  shall  exceed  the taxpayer's tax for such year, the
   45  excess may be carried over to the following year or years,  and  may  be
   46  applied against the taxpayer's tax for such year or years] ALLOWED UNDER
   47  THIS SUBSECTION FOR ANY TAXABLE YEAR SHALL EXCEED THE TAXPAYER'S TAX FOR
   48  SUCH  YEAR,  THE  EXCESS SHALL BE TREATED AS AN OVERPAYMENT OF TAX TO BE
   49  CREDITED OR REFUNDED IN ACCORDANCE WITH THE PROVISIONS  OF  SECTION  SIX
   50  HUNDRED  EIGHTY-SIX OF THIS ARTICLE, PROVIDED, HOWEVER, THAT NO INTEREST
   51  SHALL BE PAID THEREON.
   52    (5) To be eligible for the credit allowable under this subsection  the
   53  rehabilitation  project  shall  be  in whole or in part [a targeted area
   54  residence within the meaning of section 143(j) of the  internal  revenue
       S. 2609--A                         41                         A. 3009--A
    1  code  or]  located within a census tract which is identified as being at
    2  or below one hundred percent of the state median family income  [in  the
    3  most  recent federal census] AS CALCULATED USING A FIVE YEAR SAMPLE FROM
    4  THE  AMERICAN COMMUNITY SURVEY BEGINNING WITH THE YEAR TWO THOUSAND SIX-
    5  -YEAR TWO THOUSAND ELEVEN SAMPLE.
    6    S 2. Subparagraph (A) of paragraph 1, and paragraphs 4 and 5 of subdi-
    7  vision 40 of section 210 of the tax law, subparagraph (A) of paragraph 1
    8  and paragraph 4 as amended and paragraph 5 as added by  chapter  472  of
    9  the laws of 2010, are amended to read as follows:
   10    (A)  For  taxable years beginning on or after January first, two thou-
   11  sand ten and before January first,  two  thousand  [fifteen]  TWENTY,  a
   12  taxpayer  shall be allowed a credit as hereinafter provided, against the
   13  tax imposed by this article, in an amount equal to one  hundred  percent
   14  of the amount of credit allowed the taxpayer with respect to a certified
   15  historic structure under subsection (a) (2) of section 47 of the federal
   16  internal  revenue  code  with  respect to a certified historic structure
   17  located within the state. Provided, however, the credit shall not exceed
   18  five million dollars. For taxable years beginning on  or  after  January
   19  first,  two  thousand  [fifteen]  TWENTY,  a taxpayer shall be allowed a
   20  credit as hereinafter provided, against the tax imposed by this article,
   21  in an amount equal to thirty percent of the amount of credit allowed the
   22  taxpayer with respect to a certified historic structure under subsection
   23  (a)(2) of section 47 of the federal internal revenue code  with  respect
   24  to  a  certified  historic structure located within the state. Provided,
   25  however, the credit shall not exceed one hundred thousand dollars.
   26    (4) The credit allowed under this subdivision  for  any  taxable  year
   27  shall  not  reduce  the tax due for such year to less than the higher of
   28  the amounts prescribed in paragraphs (c) and (d) of subdivision  one  of
   29  this section. However, if the amount of the credit [allowable under this
   30  subdivision  for  any  taxable  year shall exceed the taxpayer's tax for
   31  such year, the excess may be carried  over  to  the  following  year  or
   32  years,  and  may  be  deducted  from the taxpayer's tax for such year or
   33  years] ALLOWED UNDER THIS SUBDIVISION FOR ANY TAXABLE YEAR  REDUCES  THE
   34  TAX  TO  SUCH  AMOUNT,  ANY AMOUNT OF CREDIT THUS NOT DEDUCTIBLE IN SUCH
   35  TAXABLE YEAR SHALL BE TREATED AS AN OVERPAYMENT OF TAX TO BE CREDITED OR
   36  REFUNDED IN ACCORDANCE WITH  THE  PROVISIONS  OF  SECTION  ONE  THOUSAND
   37  EIGHTY-SIX  OF  THIS  CHAPTER.    PROVIDED,  HOWEVER,  THE PROVISIONS OF
   38  SUBSECTION (C) OF SECTION ONE  THOUSAND  EIGHTY-EIGHT  OF  THIS  CHAPTER
   39  NOTWITHSTANDING, NO INTEREST SHALL BE PAID THEREON.
   40    (5)  To  be  eligible for the credit allowable under this subdivision,
   41  the rehabilitation project shall be in whole or in part [a targeted area
   42  residence within the meaning of section 143(j) of the  internal  revenue
   43  code  or]  located within a census tract which is identified as being at
   44  or below one hundred percent of the state median family income  [in  the
   45  most  recent federal census] AS CALCULATED USING A FIVE YEAR SAMPLE FROM
   46  THE AMERICAN COMMUNITY SURVEY BEGINNING WITH THE YEAR TWO THOUSAND  SIX-
   47  -YEAR TWO THOUSAND ELEVEN SAMPLE.
   48    S  3.  Subparagraph  (A)  of  paragraph  1,  and paragraphs 4 and 5 of
   49  subsection (u) of section 1456 of the tax law, as added by  chapter  472
   50  of the laws of 2010, are amended to read as follows:
   51    (A)  For  taxable years beginning on or after January first, two thou-
   52  sand ten and before January first,  two  thousand  [fifteen]  TWENTY,  a
   53  taxpayer  shall be allowed a credit as hereinafter provided, against the
   54  tax imposed by this article, in an amount equal to one  hundred  percent
   55  of the amount of credit allowed the taxpayer with respect to a certified
   56  historic  structure under subsection (a)(2) of section 47 of the federal
       S. 2609--A                         42                         A. 3009--A
    1  internal revenue code with respect to  a  certified  historic  structure
    2  located within the state. Provided, however, the credit shall not exceed
    3  five  million  dollars.  For taxable years beginning on or after January
    4  first,  two  thousand  [fifteen]  TWENTY,  a taxpayer shall be allowed a
    5  credit as hereinafter provided, against the tax imposed by this article,
    6  in an amount equal to thirty percent of the amount of credit allowed the
    7  taxpayer with respect to a certified historic structure under subsection
    8  (a)(2) of section 47 of the federal internal revenue code  with  respect
    9  to  a  certified  historic structure located within the state. Provided,
   10  however, the credit shall not exceed one hundred thousand dollars.
   11    (4) The credit allowed under this  subsection  for  any  taxable  year
   12  shall not reduce the tax to less than the dollar amount fixed as a mini-
   13  mum tax by subsection (b) of section fourteen hundred fifty-five of this
   14  article.  [If  the  amount of credit allowable under this subsection for
   15  any taxable year reduces the tax to  such  amount,  the  excess  may  be
   16  carried  over  to  the following year or years, and may be deducted from
   17  the taxpayer's tax for such year or years.] HOWEVER, IF  THE  AMOUNT  OF
   18  CREDIT  ALLOWED  UNDER  THIS SUBSECTION FOR ANY TAXABLE YEAR REDUCES THE
   19  TAX TO SUCH AMOUNT, ANY AMOUNT OF CREDIT THUS  NOT  DEDUCTIBLE  IN  SUCH
   20  TAXABLE YEAR SHALL BE TREATED AS AN OVERPAYMENT OF TAX TO BE CREDITED OR
   21  REFUNDED  IN  ACCORDANCE  WITH  THE  PROVISIONS  OF SECTION ONE THOUSAND
   22  EIGHTY-SIX  OF  THIS  CHAPTER.  PROVIDED,  HOWEVER,  THE  PROVISIONS  OF
   23  SUBSECTION  (C)  OF  SECTION  ONE  THOUSAND EIGHTY-EIGHT OF THIS CHAPTER
   24  NOTWITHSTANDING, NO INTEREST SHALL BE PAID THEREON.
   25    (5) To be eligible for the credit allowable under this subsection  the
   26  rehabilitation  project  shall  be  in whole or in part [a targeted area
   27  residence within the meaning of section 143(j) of the  internal  revenue
   28  code  or]  located within a census tract which is identified as being at
   29  or below one hundred percent of the state median family income  [in  the
   30  most  recent federal census] AS CALCULATED USING A FIVE YEAR SAMPLE FROM
   31  THE AMERICAN COMMUNITY SURVEY BEGINNING WITH THE YEAR TWO THOUSAND  SIX-
   32  -YEAR TWO THOUSAND ELEVEN SAMPLE.
   33    S 4. Subparagraph (A) of paragraph 1, and paragraphs 4 and 5 of subdi-
   34  vision  (y)  of  section 1511 of the tax law, as added by chapter 472 of
   35  the laws of 2010, are amended to read as follows:
   36    (A) For taxable years beginning on or after January first,  two  thou-
   37  sand  ten  and  before  January  first, two thousand [fifteen] TWENTY, a
   38  taxpayer shall be allowed a credit as hereinafter provided, against  the
   39  tax  imposed  by this article, in an amount equal to one hundred percent
   40  of the amount of credit allowed the taxpayer with respect to a certified
   41  historic structure under subsection (a)(2) of section 47 of the  federal
   42  internal  revenue  code  with  respect to a certified historic structure
   43  located within the state. Provided, however, the credit shall not exceed
   44  five million dollars. For taxable years beginning on  or  after  January
   45  first,  two  thousand  [fifteen]  TWENTY,  a taxpayer shall be allowed a
   46  credit as hereinafter provided, against the tax imposed by this article,
   47  in an amount equal to thirty percent of the amount of credit allowed the
   48  taxpayer with respect to a certified historic structure under subsection
   49  (a)(2) of section 47 of the federal internal revenue code  with  respect
   50  to  a  certified  historic structure located within the state. Provided,
   51  however, the credit shall not exceed one hundred thousand dollars.
   52    (4) The credit allowed under this subdivision  for  any  taxable  year
   53  shall  not  reduce  the  tax  due for such year to less than the minimum
   54  fixed by paragraph four of subdivision (a) of  section  fifteen  hundred
   55  two  or  section  fifteen  hundred  two-a  of this article, whichever is
   56  applicable.  [If the amount of the credit allowable under this  subdivi-
       S. 2609--A                         43                         A. 3009--A
    1  sion for any taxable year reduces the tax to such amount, the excess may
    2  be carried over to the following year or years, and may be deducted from
    3  the  taxpayer's  tax  for such year or years.] HOWEVER, IF THE AMOUNT OF
    4  CREDITS  ALLOWED UNDER THIS SUBDIVISION FOR ANY TAXABLE YEAR REDUCES THE
    5  TAX TO SUCH AMOUNT, ANY AMOUNT OF CREDIT THUS  NOT  DEDUCTIBLE  IN  SUCH
    6  TAXABLE YEAR SHALL BE TREATED AS AN OVERPAYMENT OF TAX TO BE CREDITED OR
    7  REFUNDED  IN  ACCORDANCE  WITH  THE  PROVISIONS  OF SECTION ONE THOUSAND
    8  EIGHTY-SIX  OF  THIS  CHAPTER.  PROVIDED,  HOWEVER,  THE  PROVISIONS  OF
    9  SUBSECTION  (C)  OF  SECTION  ONE  THOUSAND EIGHTY-EIGHT OF THIS CHAPTER
   10  NOTWITHSTANDING, NO INTEREST SHALL BE PAID THEREON.
   11    (5) To be eligible for the credit allowable  under  this  subdivision,
   12  the rehabilitation project shall be in whole or in part [a targeted area
   13  residence  within  the meaning of section 143(j) of the internal revenue
   14  code or] located within a census tract which is identified as  being  at
   15  or  below  one hundred percent of the state median family income [in the
   16  most recent federal census] AS CALCULATED USING A FIVE YEAR SAMPLE  FROM
   17  THE  AMERICAN COMMUNITY SURVEY BEGINNING WITH THE YEAR TWO THOUSAND SIX-
   18  -YEAR TWO THOUSAND ELEVEN SAMPLE.
   19    S 5. This act shall take effect immediately and shall apply to taxable
   20  years beginning on and after  January  1,  2013;  provided  however  the
   21  amendments  to  paragraph 4 of subsection (oo) of section 606 of the tax
   22  law made by section one of this act, the amendments to  paragraph  4  of
   23  subdivision 40 of section 210 of the tax law made by section two of this
   24  act,  the amendments to paragraph 4 of subsection (u) of section 1456 of
   25  the tax law made by section three of this  act  and  the  amendments  to
   26  paragraph  4  of  subdivision (y) of section 1511 of the tax law made by
   27  section four of this act shall take effect January  1,  2015  and  shall
   28  apply to taxable years beginning on and after January 1, 2015 for quali-
   29  fied rehabilitation placed in service on or after January 1, 2015.
   30                                   PART G
   31    Section  1.  Section 187-b of the tax law, as amended by section 14 of
   32  part W-1 of chapter 109 of the laws of  2006,  is  amended  to  read  as
   33  follows:
   34    S  187-b. [Alternative fuels credit] ELECTRIC VEHICLE RECHARGING PROP-
   35  ERTY CREDIT. 1. General. A taxpayer shall be allowed  a  credit,  to  be
   36  credited  against  the  taxes imposed under sections one hundred eighty-
   37  three, one hundred eighty-four, and  one  hundred  eighty-five  of  this
   38  article.  Such  credit, to be computed as hereinafter provided, shall be
   39  allowed  for  [alternative  fuel  vehicle  refueling]  ELECTRIC  VEHICLE
   40  RECHARGING property placed in service during the taxable year. Provided,
   41  however,  that  the  amount  of  such  credit  allowable against the tax
   42  imposed by section one hundred eighty-four of this article shall be  the
   43  excess  of  the  credit  allowed by this section over the amount of such
   44  credit allowable against the tax imposed by section one hundred  eighty-
   45  three of this article.
   46    2.  [Alternative  fuel  vehicle  refueling  property] ELECTRIC VEHICLE
   47  RECHARGING PROPERTY.   The credit under this  section  for  [alternative
   48  fuel vehicle refueling] ELECTRIC VEHICLE RECHARGING property shall equal
   49  FOR EACH INSTALLATION OF PROPERTY THE LESSER OF FIVE THOUSAND DOLLARS OR
   50  fifty percent of the cost of any such property:
   51    (a) which is located in this state; [and]
   52    (b)  [for  which  a  credit  is  allowed under section thirty C of the
   53  internal revenue code but not including alternative fuel vehicle refuel-
   54  ing property relating to a qualified hybrid vehicle as such  vehicle  is
       S. 2609--A                         44                         A. 3009--A
    1  defined  in  subparagraph  (B)  of  paragraph three of subsection (p) of
    2  section six hundred six of  this  chapter]  WHICH  CONSTITUTES  ELECTRIC
    3  VEHICLE RECHARGING PROPERTY; AND
    4    (C)  FOR WHICH NONE OF THE COST HAS BEEN PAID FOR FROM THE PROCEEDS OF
    5  GRANTS, INCLUDING GRANTS FROM THE NEW YORK  STATE  ENERGY  RESEARCH  AND
    6  DEVELOPMENT AUTHORITY OR THE NEW YORK POWER AUTHORITY.
    7    3.  Definitions.  [(a)]  The term ["alternative fuel vehicle refueling
    8  property"] "ELECTRIC VEHICLE RECHARGING PROPERTY" means [any such  prop-
    9  erty  which  is  qualified within the meaning of section thirty C of the
   10  internal revenue code, but shall not include  alternative  fuel  vehicle
   11  refueling  property relating to a qualified hybrid vehicle as such vehi-
   12  cle is defined in subparagraph (B) of paragraph three of subsection  (p)
   13  of  section six hundred six of this chapter] ALL THE EQUIPMENT NEEDED TO
   14  CONVEY ELECTRIC POWER FROM THE ELECTRIC GRID OR ANOTHER POWER SOURCE  TO
   15  AN ONBOARD VEHICLE ENERGY STORAGE SYSTEM.
   16    [(b)  The  term "qualified hybrid vehicle" shall have the same meaning
   17  as provided for under subparagraph (B) of paragraph three of  subsection
   18  (p) of section six hundred six of this chapter.]
   19    4.  Carryovers.  In  no  event  shall the credit under this section be
   20  allowed in an amount which will reduce the tax payable to less than  the
   21  applicable  minimum tax fixed by section one hundred eighty-three or one
   22  hundred eighty-five of this article. If, however, the amount  of  credit
   23  allowable  under  this  section  for any taxable year reduces the tax to
   24  such amount, any amount of credit not deductible in  such  taxable  year
   25  may  be  carried over to the following year or years and may be deducted
   26  from the taxpayer's tax for such year or years.
   27    5. Credit recapture[; Alternative fuel  vehicle  refueling  property].
   28  If, at any time before the end of its recovery period, [alternative fuel
   29  vehicle  refueling]  ELECTRIC  VEHICLE  RECHARGING property ceases to be
   30  qualified, a recapture amount must be added back in the  year  in  which
   31  such cessation occurs.
   32    (i)  Cessation  of  qualification. [Alternative fuel vehicle refueling
   33  property] ELECTRIC VEHICLE RECHARGING PROPERTY ceases  to  be  qualified
   34  if:
   35    (I) the property no longer qualifies as [property described in section
   36  thirty C of the internal revenue code] ELECTRIC VEHICLE RECHARGING PROP-
   37  ERTY; or
   38    (II)  fifty  percent  or  more of the use of the property in a taxable
   39  year is other than a trade or business in this state; or
   40    (III) the taxpayer receiving the credit under this  section  sells  or
   41  disposes  of the property and knows or has reason to know that the prop-
   42  erty will be used in a manner described in this subparagraph.
   43    (ii) Recapture amount. The recapture amount is  equal  to  the  credit
   44  allowable  under this section multiplied by a fraction, the numerator of
   45  which is the total recovery period for the property minus the number  of
   46  recovery  years prior to, but not including, the recapture year, and the
   47  denominator of which is the total recovery period.
   48    6. Termination. The credit allowed by subdivision two of this  section
   49  shall  not apply in taxable years beginning after December thirty-first,
   50  two thousand [ten] SEVENTEEN.
   51    S 2. Subdivision 24 of section 210 of  the  tax  law,  as  amended  by
   52  section 15 of part W-1 of chapter 109 of the laws of 2006, is amended to
   53  read as follows:
   54    24.  [Alternative  fuels] ELECTRIC VEHICLE RECHARGING PROPERTY credit.
   55  (a) General. A taxpayer shall be allowed a credit,  to  be  computed  as
   56  hereinafter  provided,  against  the  tax  imposed  by  this article for
       S. 2609--A                         45                         A. 3009--A
    1  [alternative fuel vehicle refueling] ELECTRIC VEHICLE RECHARGING proper-
    2  ty placed in service during the taxable year.
    3    (b)  [Alternative  fuel  vehicle  refueling property] ELECTRIC VEHICLE
    4  RECHARGING PROPERTY.  The credit under this subdivision for [alternative
    5  fuel vehicle refueling] ELECTRIC VEHICLE RECHARGING property shall equal
    6  FOR EACH INSTALLATION OF PROPERTY THE LESSER OF FIVE THOUSAND DOLLARS OR
    7  fifty percent of the cost of any such property:
    8    (i) which is located in this state; [and]
    9    (ii) [for which a credit is allowed under  section  thirty  C  of  the
   10  internal revenue code but not including alternative fuel refueling prop-
   11  erty  relating  to a qualified hybrid vehicle as such vehicle is defined
   12  in subparagraph (B) of paragraph three of subsection (p) of section  six
   13  hundred  six of this chapter] WHICH IS ELECTRIC VEHICLE RECHARGING PROP-
   14  ERTY; AND
   15    (III) FOR WHICH NONE OF THE COST HAS BEEN PAID FOR FROM  THE  PROCEEDS
   16  OF  GRANTS, INCLUDING GRANTS FROM THE NEW YORK STATE ENERGY RESEARCH AND
   17  DEVELOPMENT AUTHORITY OR THE NEW YORK POWER AUTHORITY.
   18    (c) Definitions. The term ["alternative fuel vehicle refueling proper-
   19  ty"] "ELECTRIC VEHICLE RECHARGING PROPERTY"  means  [any  such  property
   20  which  is qualified within the meaning of section thirty C of the inter-
   21  nal revenue code but shall not include alternative fuel vehicle  refuel-
   22  ing  property  relating to a qualified hybrid vehicle as such vehicle is
   23  defined in subparagraph (B) of paragraph  three  of  subsection  (p)  of
   24  section  six hundred six of this chapter] ALL OF THE EQUIPMENT NEEDED TO
   25  CONVEY ELECTRIC POWER FROM THE ELECTRIC GRID OR ANOTHER POWER SOURCE  TO
   26  AN ONBOARD VEHICLE ENERGY STORAGE SYSTEM.
   27    (d) Carryovers. In no event shall the credit under this subdivision be
   28  allowed  in an amount which will reduce the tax payable to less than the
   29  higher of the amounts prescribed in paragraphs (c) and (d)  of  subdivi-
   30  sion one of this section. Provided, however, that if the amount of cred-
   31  it allowable under this subdivision for any taxable year reduces the tax
   32  to such amount, any amount of credit not deductible in such taxable year
   33  may  be  carried over to the following year or years and may be deducted
   34  from the taxpayer's tax for such year or years.
   35    (e) Credit recapture. [(i) Alternative fuel vehicle refueling  proper-
   36  ty.] If, at any time before the end of its recovery period, [alternative
   37  fuel  vehicle  refueling] ELECTRIC VEHICLE RECHARGING property ceases to
   38  be qualified, a recapture amount must be added back in the year in which
   39  such cessation occurs.
   40    (A) [Alternative fuel vehicle refueling] ELECTRIC  VEHICLE  RECHARGING
   41  property ceases to be qualified if:
   42    (1) the property no longer qualifies as [property described in section
   43  thirty C of the internal revenue code] ELECTRIC VEHICLE RECHARGING PROP-
   44  ERTY; or
   45    (2) fifty percent or more of the use of the property in a taxable year
   46  is other than in a trade or business in this state; or
   47    (3)  the taxpayer receiving the credit under this subdivision sells or
   48  disposes of the property and knows or has reason to know that the  prop-
   49  erty  will  be used in a manner described in clauses one and two of this
   50  subparagraph.
   51    (B) Recapture amount. The recapture amount  is  equal  to  the  credit
   52  allowable under this subdivision multiplied by a fraction, the numerator
   53  of  which is the total recovery period for the property minus the number
   54  of recovery years prior to, but not including, the recapture  year,  and
   55  the denominator of which is the total recovery period.
       S. 2609--A                         46                         A. 3009--A
    1    [(f)  Affiliates. (i) If a credit under this subdivision is allowed to
    2  a taxpayer with respect to a taxable year,  the  action  taken  by  such
    3  taxpayer which resulted in such credit being allowed thereto may, at the
    4  election  of  the taxpayer and an affiliate thereof, be ascribed to such
    5  affiliate.  Where  such  affiliate, based on such ascription, is allowed
    6  such credit and deducts from the tax otherwise due the  amount  of  such
    7  credit, such credit shall be deemed in all respects to have been allowed
    8  to  such affiliate, provided that any action or inaction by the taxpayer
    9  which constitutes an event of recapture described in  paragraph  (e)  of
   10  this subdivision shall be ascribed to the affiliate and shall constitute
   11  an  event  of recapture with respect to the credit allowed to the affil-
   12  iate pursuant to this subdivision.
   13    (ii) Notwithstanding any other provision of law to  the  contrary,  in
   14  the case of the credit provided for under this subdivision being allowed
   15  to, or asserted to be allowed to, an affiliate, pursuant to subparagraph
   16  (i)  of this paragraph, the commissioner shall have the same powers with
   17  respect to examining the books and records of  the  taxpayer,  and  have
   18  such  other powers of investigation with respect to the taxpayer, as are
   19  afforded under this  chapter  with  respect  to  a  taxpayer  which  has
   20  deducted  the  credit allowed under this section from tax otherwise due,
   21  as if it were the taxpayer which  had  deducted  such  credit  from  tax
   22  otherwise due.
   23    (iii)  The term "affiliate" shall mean a corporation substantially all
   24  the capital stock of which is owned or  controlled  either  directly  or
   25  indirectly by the taxpayer, or which owns or controls either directly or
   26  indirectly  substantially  all  the  capital  stock  of the taxpayer, or
   27  substantially all the capital stock of  which  is  owned  or  controlled
   28  either  directly  or indirectly by interests which own or control either
   29  directly or indirectly  substantially  all  the  capital  stock  of  the
   30  taxpayer.]
   31    [(g)]  (F)  Termination.  The  credit allowed by paragraph (b) of this
   32  subdivision shall not apply in taxable years  beginning  after  December
   33  thirty-first, two thousand [ten] SEVENTEEN.
   34    S  3.  Subsection  (p)  of  section  606 of the tax law, as amended by
   35  section 16 of part W-1 of chapter 109 of the laws of 2006, is amended to
   36  read as follows:
   37    (p) [Alternative fuels] ELECTRIC VEHICLE RECHARGING  PROPERTY  credit.
   38  (1)  General.  A  taxpayer  shall be allowed a credit, to be computed as
   39  hereinafter provided, against the  tax  imposed  by  this  article,  for
   40  [alternative fuel vehicle refueling] ELECTRIC VEHICLE RECHARGING proper-
   41  ty placed in service during the taxable year.
   42    (2)  [Alternative  fuel  vehicle  refueling property] ELECTRIC VEHICLE
   43  RECHARGING PROPERTY.  The credit under this subsection  for  [clean-fuel
   44  vehicle  refueling] ELECTRIC VEHICLE RECHARGING property shall equal FOR
   45  EACH INSTALLATION OF PROPERTY THE LESSER OF  FIVE  THOUSAND  DOLLARS  OR
   46  fifty percent of the cost of any such property
   47    (A) which is located in this state [and];
   48    (B)  [for  which  a  credit  is  allowed under section thirty C of the
   49  internal revenue code but not including alternative fuel vehicle refuel-
   50  ing property relating to a qualified hybrid vehicle as such  vehicle  is
   51  defined in subparagraph (B) of paragraph three of this subsection] WHICH
   52  IS ELECTRIC VEHICLE RECHARGING PROPERTY; AND
   53    (C)  FOR WHICH NONE OF THE COST HAS BEEN PAID FOR FROM THE PROCEEDS OF
   54  GRANTS, INCLUDING GRANTS FROM THE NEW YORK  STATE  ENERGY  RESEARCH  AND
   55  DEVELOPMENT AUTHORITY OR THE NEW YORK POWER AUTHORITY.
       S. 2609--A                         47                         A. 3009--A
    1    (3)  Definitions.  [(A)] The term ["alternative fuel vehicle refueling
    2  property"] "ELECTRIC VEHICLE RECHARGING PROPERTY" means [any such  prop-
    3  erty  which  is  qualified within the meaning of section thirty C of the
    4  internal revenue code, but such term shall not include alternative  fuel
    5  vehicle  refueling  property  relating  to a qualified hybrid vehicle as
    6  such vehicle is defined in subparagraph (B) of this paragraph]  ALL  THE
    7  EQUIPMENT  NEEDED  TO  CONVEY  ELECTRIC  POWER FROM THE ELECTRIC GRID OR
    8  ANOTHER POWER SOURCE TO AN ONBOARD VEHICLE ENERGY STORAGE SYSTEM.
    9    [(B) The term "qualified hybrid vehicle" means  a  motor  vehicle,  as
   10  defined  in  section  one hundred twenty-five of the vehicle and traffic
   11  law,, that:
   12    (i) draws propulsion energy from both
   13    (a) an internal combustion engine (or heat engine that uses  combusti-
   14  ble fuel); and
   15    (b) an energy storage device; and
   16    (ii) employs a regenerative vehicle braking system that recovers waste
   17  energy to charge such energy storage device.]
   18    (4)   Carryovers.  If  the  amount  of  credit  allowable  under  this
   19  subsection shall exceed the taxpayer's tax for such year, the excess may
   20  be carried over to the following year or years and may be deducted  from
   21  the taxpayer's tax for such year or years.
   22    (5) Credit recapture. (A) [Vehicles.
   23    (i) If, within three full years from the date a qualified hybrid vehi-
   24  cle or a vehicle of which alternative fuel vehicle property is a part is
   25  placed  in  service,  such  qualified hybrid vehicle or vehicle of which
   26  alternative fuel vehicle property is a part] IF, AT ANY TIME BEFORE  THE
   27  END  OF ITS RECOVERY PERIOD, ELECTRIC VEHICLE RECHARGING PROPERTY ceases
   28  to be qualified, a recapture amount must be added back in the  tax  year
   29  in which such cessation occurs.
   30    [(ii)] (B) Cessation of qualification. [(I) A qualified hybrid vehicle
   31  ceases to be qualified if
   32    (a)  it  is  modified  by  the taxpayer so that it no longer meets the
   33  requirements of a qualified hybrid vehicle as  defined  in  subparagraph
   34  (B) of paragraph three of this subsection.
   35    (b)  the  taxpayer receiving the credit under this subsection sells or
   36  disposes of the vehicle and knows or has reason to know that the vehicle
   37  will be so modified.
   38    (B) Alternative fuel vehicle refueling property. (i) If, at  any  time
   39  before  the end of its recovery period, alternative fuel vehicle refuel-
   40  ing property ceases to be qualified, a recapture amount  must  be  added
   41  back in the year in which such cessation occurs.
   42    (ii)  Cessation  of qualification. Clean-fuel vehicle refueling] ELEC-
   43  TRIC VEHICLE RECHARGING property ceases to be qualified if:
   44    [(I)] (I) the property no longer qualifies as [property  described  in
   45  section thirty C of the internal revenue code] ELECTRIC VEHICLE RECHARG-
   46  ING PROPERTY, or
   47    [(II)]  (II)  fifty  percent  or  more of the use of the property in a
   48  taxable year is other than in a trade or business in this state, or
   49    [(III)] (III) the taxpayer receiving the credit under this  subsection
   50  sells  or  disposes of the property and knows or has reason to know that
   51  the property will be used in a manner described in [item (I)] CLAUSE (I)
   52  or [(II)] (II) of this [clause] SUBPARAGRAPH.
   53    [(iii)] (C) Recapture amount. The recapture amount  is  equal  to  the
   54  credit  allowable  under  this  subsection multiplied by a fraction, the
   55  numerator of which is the total recovery period for the  property  minus
       S. 2609--A                         48                         A. 3009--A
    1  the  number of recovery years prior to, but not including, the recapture
    2  year, and the denominator of which is the total recovery period.
    3    (6)  Termination.  The  credit  allowed  by  [paragraph  two  of] this
    4  subsection shall not apply in taxable  years  beginning  after  December
    5  thirty-first, two thousand [ten] SEVENTEEN.
    6    S  4. Clause (ix) of subparagraph (B) of paragraph 1 of subsection (i)
    7  of section 606 of the tax law, as amended by section 7 of  part  C-1  of
    8  chapter 57 of the laws of 2009, is amended to read as follows:
    9  (ix) [Alternative fuels]             [Cost] AMOUNT OF CREDIT
   10  ELECTRIC VEHICLE                     under subdivision twenty-four
   11  RECHARGING PROPERTY                  of section two hundred ten
   12  credit under subsection (p)
   13    S 5. This act shall take effect immediately and shall apply to taxable
   14  years  beginning  on  or  after  January  1, 2013 for property placed in
   15  service on or after such date.
   16                                   PART H
   17    Section 1. Paragraph 10 of subsection (g) of section 658  of  the  tax
   18  law is REPEALED.
   19    S  2. Paragraph 10 of subdivision (g) of section 11-1758 of the admin-
   20  istrative code of the city of New York is REPEALED.
   21    S 3. Paragraph 5 of subsection (u) of section 685 of the  tax  law  is
   22  REPEALED.
   23    S 4. Paragraph 5 of subdivision (t) of section 11-1785 of the adminis-
   24  trative code of the city of New York is REPEALED.
   25    S  5.  Section  23  of  part  U  of chapter 61 of the laws of 2011, as
   26  amended by section 1 of part G of chapter 59 of the  laws  of  2012,  is
   27  amended to read as follows:
   28    S 23. This act shall take effect immediately; provided, however, that:
   29    (a)  the amendments to section 29 of the tax law made by section thir-
   30  teen of this act shall apply to tax documents filed or  required  to  be
   31  filed  on  or  after  the  sixtieth  day after which this act shall have
   32  become a law [and shall expire  and  be  deemed  repealed  December  31,
   33  2013],  provided  however that the amendments to paragraph 4 of subdivi-
   34  sion (a) of section 29 of the tax law and paragraph 2 of subdivision (e)
   35  of section 29 of the tax law made by section thirteen of this  act  with
   36  regard  to individual taxpayers shall take effect September 15, 2011 but
   37  only if the commissioner of taxation and finance  has  reported  in  the
   38  report  required  by section seventeen-b of this act that the percentage
   39  of individual taxpayers electronically  filing  their  2010  income  tax
   40  returns is less than eighty-five percent; provided that the commissioner
   41  of  taxation  and  finance  shall  notify  the legislative bill drafting
   42  commission of the date of the issuance of such report in order that  the
   43  commission  may  maintain  an accurate and timely effective data base of
   44  the official text of the laws of the state of New York in furtherance of
   45  effectuating the provisions of section 44 of  the  legislative  law  and
   46  section 70-b of the public officers law;
   47    (b)  sections  fourteen,  fifteen,  sixteen  and seventeen of this act
   48  shall take effect September 15, 2011 but only  if  the  commissioner  of
   49  taxation  and  finance  has  reported  in the report required by section
   50  seventeen-b of this act that  the  percentage  of  individual  taxpayers
   51  electronically  filing their 2010 income tax returns is less than eight-
   52  y-five percent;
       S. 2609--A                         49                         A. 3009--A
    1    (c) sections fourteen-a and fifteen-a of this act  shall  take  effect
    2  September  15,  2011 and expire and be deemed repealed December 31, 2012
    3  but shall take effect only if the commissioner of taxation  and  finance
    4  has  reported  in the report required by section seventeen-b of this act
    5  that  the percentage of individual taxpayers electronically filing their
    6  2010 income tax returns is eighty-five percent or greater; AND
    7    (d) sections fourteen-b, fifteen-b, sixteen-a and seventeen-a of  this
    8  act  shall  take  effect January 1, 2014 but only if the commissioner of
    9  taxation and finance has reported in  the  report  required  by  section
   10  seventeen-b  of  this  act  that  the percentage of individual taxpayers
   11  electronically filing their 2010 income tax returns is less than  eight-
   12  y-five percent[; and
   13    (e)  sections twenty-one and twenty-one-a of this act shall expire and
   14  be deemed repealed December 31, 2013].
   15    S 6. This act shall take effect immediately.
   16                                   PART I
   17    Section 1. Legislative intent. The legislature  seeks  to  demonstrate
   18  that  the  state of New York is open for business by promoting, attract-
   19  ing, and encouraging the development of business  in  the  state.    The
   20  legislature  intends  to encourage businesses to locate in the state and
   21  produce goods and services within  the  state,  thereby  increasing  job
   22  creation  and economic growth. The legislature further intends to foster
   23  economic development by showcasing various goods that  are  produced  in
   24  New  York.  In  order  to  accomplish  these objectives, the legislature
   25  intends that there shall be  established  "Taste-NY  facilities,"  which
   26  will  sell  a variety of products, including but not limited to products
   27  produced within the state, and prominently  feature  New  York  produced
   28  goods, including alcoholic beverages.
   29    S  2.  Subdivision  (b)  of  section 1101 of the tax law is amended by
   30  adding a new paragraph 39 to read as follows:
   31    (39) TASTE-NY FACILITY. "TASTE-NY  FACILITY"  SHALL  MEAN  A  FACILITY
   32  OPERATED  BY  A PERSON DESIGNATED BY AND PURSUANT TO A WRITTEN AGREEMENT
   33  WITH A STATE AGENCY, PUBLIC AUTHORITY, OR AN INTERSTATE AGENCY OR PUBLIC
   34  CORPORATION CREATED PURSUANT TO AN AGREEMENT  OR  COMPACT  WITH  ANOTHER
   35  STATE  OR  THE DOMINION OF CANADA, FROM WHICH SALES ARE MADE OF TANGIBLE
   36  PERSONAL PROPERTY OR FOOD AND DRINK (WHETHER OR NOT FOR  CONSUMPTION  ON
   37  THE  PREMISES  OF SUCH FACILITY), AND THAT PROMINENTLY FEATURES PRODUCTS
   38  PRODUCED WITHIN THE STATE.
   39    S 3. Subdivision (a) of section 1115 of the  tax  law  is  amended  by
   40  adding a new paragraph 44 to read as follows:
   41    (44)  TANGIBLE  PERSONAL  PROPERTY  SOLD  AT  A  TASTE-NY FACILITY, AS
   42  DEFINED IN PARAGRAPH THIRTY-NINE OF SECTION ELEVEN HUNDRED ONE  OF  THIS
   43  ARTICLE,  FOR  WHICH THE RECEIPT OR CONSIDERATION GIVEN OR CONTRACTED TO
   44  BE GIVEN IS LESS THAN TWO HUNDRED DOLLARS PER ITEM.
   45    S 4. Section 1115 of the tax law is amended by adding a  new  subdivi-
   46  sion (ii) to read as follows:
   47    (II) RECEIPTS FROM SALES OF THE FOLLOWING AT A TASTE-NY FACILITY SHALL
   48  BE  EXEMPT  FROM THE SALES TAX IMPOSED UNDER SECTION ELEVEN HUNDRED FIVE
   49  AND THE COMPENSATING USE TAX IMPOSED UNDER SECTION ELEVEN HUNDRED TEN OF
   50  THIS ARTICLE: (1) FOOD OR DRINK FOR CONSUMPTION ON THE PREMISES OF  SUCH
   51  FACILITY;  (2)  FOOD  OR  DRINK SOLD FOR CONSUMPTION OFF THE PREMISES OF
   52  SUCH FACILITY THAT IS SOLD IN A HEATED STATE; (3)  SANDWICHES  SOLD  FOR
   53  CONSUMPTION  OFF THE PREMISES OF SUCH FACILITY, WHETHER OR NOT SOLD IN A
   54  HEATED STATE; (4) FOOD OR DRINK SOLD THROUGH VENDING MACHINES;  AND  (5)
       S. 2609--A                         50                         A. 3009--A
    1  FOOD  OR DRINK SOLD IN AN UNHEATED STATE THAT IS OF A TYPE COMMONLY SOLD
    2  FOR OFF-PREMISES CONSUMPTION AND IS NOT IN  THE  SAME  FORM,  CONDITION,
    3  QUANTITIES AND PACKAGING AS IN ESTABLISHMENTS THAT ARE FOOD STORES OTHER
    4  THAN THOSE PRINCIPALLY ENGAGED IN SELLING FOODS PREPARED AND READY TO BE
    5  EATEN.
    6    S  5.  The  alcoholic  beverage control law is amended by adding a new
    7  section 63-b to read as follows:
    8    S 63-B. SPECIAL LICENSE TO SELL  ALCOHOLIC  BEVERAGES  AT  RETAIL  FOR
    9  CONSUMPTION  OFF  THE  PREMISES.  1.  ANY PERSON AUTHORIZED TO OPERATE A
   10  TASTE-NY FACILITY DESIGNATED BY AND PURSUANT TO A WRITTEN AGREEMENT WITH
   11  A STATE AGENCY, PUBLIC AUTHORITY, OR  AN  INTERSTATE  AGENCY  OR  PUBLIC
   12  CORPORATION  CREATED  PURSUANT  TO  AN AGREEMENT OR COMPACT WITH ANOTHER
   13  STATE OR THE DOMINION OF CANADA MAY MAKE APPLICATION  TO  THE  AUTHORITY
   14  FOR A SPECIAL LICENSE TO SELL ALCOHOLIC BEVERAGES AT RETAIL FOR CONSUMP-
   15  TION OFF THE LICENSED PREMISES.
   16    2.  AN  APPLICATION  FOR A LICENSE UNDER THIS SECTION SHALL BE IN SUCH
   17  FORM AND SHALL CONTAIN SUCH INFORMATION AS  SHALL  BE  REQUIRED  BY  THE
   18  AUTHORITY  AND  SHALL  BE  ACCOMPANIED BY A CHECK OR DRAFT IN THE AMOUNT
   19  REQUIRED BY THIS ARTICLE.
   20    3. SECTION FIFTY-FOUR OF THIS CHAPTER  SHALL  CONTROL  SO  FAR  AS  IS
   21  APPLICABLE THE PROCEDURE IN CONNECTION WITH SUCH APPLICATION.
   22    4. A LICENSE UNDER THIS SECTION SHALL BE ISSUED TO ALL ELIGIBLE APPLI-
   23  CANTS EXCEPT FOR GOOD CAUSE SHOWN.
   24    5. A LICENSE UNDER THIS CHAPTER SHALL NOT BE SUBJECT TO THE PROVISIONS
   25  OF  SUBDIVISIONS TWO, THREE, SIX AND SIXTEEN OF SECTION ONE HUNDRED FIVE
   26  OF THIS CHAPTER.
   27    6. NOTWITHSTANDING THE PROVISIONS OF SUBDIVISION FOURTEEN  OF  SECTION
   28  ONE  HUNDRED  FIVE  OF  THIS CHAPTER, THE HOURS OF OPERATION AND SALE OF
   29  ALCOHOLIC BEVERAGES SHALL BE GOVERNED BY THE LICENSEE'S  WRITTEN  AGREE-
   30  MENT  WITH  THE  STATE  AGENCY,  PUBLIC  AUTHORITY, INTERSTATE AGENCY OR
   31  COMPACT ENTITY.
   32    7. SUBJECT TO ANY RESTRICTION CONTAINED IN THE WRITTEN AGREEMENT  WITH
   33  THE STATE AGENCY, PUBLIC AUTHORITY, INTERSTATE AGENCY OR COMPACT ENTITY,
   34  THE  HOLDER  OF A LICENSE ISSUED UNDER THIS SECTION MAY OFFER SAMPLES OF
   35  ALCOHOLIC BEVERAGES TO CUSTOMERS TO BE CONSUMED ON THE LICENSED PREMISES
   36  UPON THE FOLLOWING CONDITIONS:
   37    (A) NO FEE SHALL BE CHARGED FOR ANY SAMPLE;
   38    (B) EACH SAMPLE SHALL BE LIMITED:
   39    (I) IN THE CASE OF BEER, WINE PRODUCTS AND CIDER, TO THREE  OUNCES  OR
   40  LESS;
   41    (II) IN THE CASE OF WINE, TO TWO OUNCES;
   42    (III) IN THE CASE OF LIQUOR, TO ONE-QUARTER OUNCE;
   43    (C) NO SAMPLE SHALL BE PROVIDED TO A CUSTOMER DURING THE HOURS PROHIB-
   44  ITED BY THE PROVISIONS OF SUBDIVISION FIVE OF SECTION ONE HUNDRED SIX OF
   45  THIS CHAPTER; AND
   46    (D)  NO  CUSTOMER  MAY BE PROVIDED WITH MORE THAN THREE SAMPLES IN ONE
   47  CALENDAR DAY.
   48    S 6. Section 66 of the alcoholic beverage control law  is  amended  by
   49  adding a new subdivision 11 to read as follows:
   50    11.  THE  ANNUAL FEE FOR A SPECIAL LICENSE TO SELL ALCOHOLIC BEVERAGES
   51  AT RETAIL FOR CONSUMPTION  OFF  THE  LICENSED  PREMISES  SHALL  BE  FIVE
   52  HUNDRED DOLLARS.
   53    S  7.  Section 67 of the alcoholic beverage control law, as amended by
   54  section 4 of part Z of chapter 85 of the laws of  2002,  is  amended  to
   55  read as follows:
       S. 2609--A                         51                         A. 3009--A
    1    S 67. License  fees,  duration  of  licenses;  fee  for  part of year.
    2  [Effective April first,  nineteen  hundred  eighty-three,  licenses]  1.
    3  LICENSES  issued pursuant to sections sixty-one, sixty-two, sixty-three,
    4  [sixty-four, sixty-four-a and sixty-four-b] AND  SIXTY-THREE-B  of  this
    5  article  shall  be  effective for three years at three times that annual
    6  fee, except that, in implementing the  purposes  of  this  section,  the
    7  liquor  authority  shall  schedule  the commencement dates, duration and
    8  expiration dates thereof to  provide  for  an  equal  cycle  of  license
    9  renewals issued under each such section through the course of the fiscal
   10  year.     [Effective  December  first,  nineteen  hundred  ninety-eight,
   11  licenses]
   12    2. LICENSES issued pursuant to sections sixty-four,  sixty-four-a  and
   13  sixty-four-b  of  this  article  shall be effective for two years at two
   14  times that annual fee, except that, in implementing the purposes of this
   15  section, the liquor authority shall  schedule  the  commencement  dates,
   16  duration  and  expiration dates thereof to provide for an equal cycle of
   17  license renewals issued under each such section through  the  course  of
   18  the  fiscal year. [Notwithstanding the foregoing, commencing on December
   19  first, nineteen hundred ninety-eight  and  concluding  on  July  thirty-
   20  first, two thousand two, a licensee issued a license pursuant to section
   21  sixty-four,  sixty-four-a  or  sixty-four-b of this article may elect to
   22  remit the fee for  such  license  in  equal  annual  installments.  Such
   23  installments  shall  be due on dates established by the liquor authority
   24  and the failure of a licensee to have remitted such annual  installments
   25  after  a  due  date  shall  be a violation of this chapter. For licenses
   26  issued for less than the three-year licensing period,  the  license  fee
   27  shall be levied on a pro-rated basis.]
   28    3.  The  entire  license  fee  shall be due and payable at the time of
   29  application. The liquor authority may make such rules as shall be appro-
   30  priate to carry out the purpose of this section.
   31    S 8. Subdivisions 1 and 2 of section 56-a of  the  alcoholic  beverage
   32  control  law, as amended by chapter 108 of the laws of 2012, are amended
   33  to read as follows:
   34    1. In addition to the annual fees provided for in this chapter,  there
   35  shall  be  paid  to  the  authority  with each initial application for a
   36  license filed pursuant to section fifty-one,  fifty-one-a,  fifty-three,
   37  fifty-eight,  sixty-one, sixty-two, seventy-six or seventy-eight of this
   38  chapter, a filing fee of four hundred dollars; with each initial  appli-
   39  cation   for   a   license   filed   pursuant  to  section  sixty-three,
   40  SIXTY-THREE-B, sixty-four, sixty-four-a or sixty-four-b of this chapter,
   41  a filing fee of two hundred dollars; with each initial application for a
   42  license filed pursuant to section fifty-three-a, fifty-four, fifty-five,
   43  fifty-five-a, seventy-nine, eighty-one or eighty-one-a of this  chapter,
   44  a filing fee of one hundred dollars; with each initial application for a
   45  permit  filed  pursuant to section ninety-one, ninety-one-a, ninety-two,
   46  ninety-two-a, ninety-three, ninety-three-a, if  such  permit  is  to  be
   47  issued on a calendar year basis, ninety-four, ninety-five, ninety-six or
   48  ninety-six-a,  or  pursuant to paragraph b, c, e or j of subdivision one
   49  of section ninety-nine-b of this chapter if such permit is to be  issued
   50  on  a calendar year basis, or for an additional bar pursuant to subdivi-
   51  sion four of section one hundred of this chapter, a filing fee of twenty
   52  dollars; and with each application for a permit  under  section  ninety-
   53  three-a  of this chapter, other than a permit to be issued on a calendar
   54  year basis, section ninety-seven, ninety-eight, ninety-nine, or  ninety-
   55  nine-b  of  this  chapter,  other than a permit to be issued pursuant to
       S. 2609--A                         52                         A. 3009--A
    1  paragraph b, c, e or j of subdivision one of  section  ninety-nine-b  of
    2  this chapter on a calendar year basis, a filing fee of ten dollars.
    3    2.  In addition to the annual fees provided for in this chapter, there
    4  shall be paid to the authority  with  each  renewal  application  for  a
    5  license  filed  pursuant to section fifty-one, fifty-one-a, fifty-three,
    6  fifty-eight, sixty-one, sixty-two, seventy-six or seventy-eight of  this
    7  chapter, a filing fee of one hundred dollars; with each renewal applica-
    8  tion for a license filed pursuant to section sixty-three, SIXTY-THREE-B,
    9  sixty-four,  sixty-four-a  or sixty-four-b of this chapter, a filing fee
   10  of ninety dollars; with each renewal application  for  a  license  filed
   11  pursuant  to  section  seventy-nine,  eighty-one or eighty-one-a of this
   12  chapter, a filing fee of twenty-five  dollars;  and  with  each  renewal
   13  application  for  a  license  or permit filed pursuant to section fifty-
   14  three-a, fifty-four, fifty-five, fifty-five-a, ninety-one, ninety-one-a,
   15  ninety-two, ninety-two-a, ninety-three, ninety-three-a, if  such  permit
   16  is issued on a calendar year basis, ninety-four, ninety-five, ninety-six
   17  or ninety-six-a of this chapter or pursuant to subdivisions b, c, e or j
   18  of  section  ninety-nine-b,  if such permit is issued on a calendar year
   19  basis, or with each renewal application for an additional  bar  pursuant
   20  to subdivision four of section one hundred of this chapter, a filing fee
   21  of thirty dollars.
   22    S  9.  Paragraph  (a) of subdivision 1 of section 101 of the alcoholic
   23  beverage control law, as amended by chapter 22 of the laws of  2011,  is
   24  amended to read as follows:
   25    (a)  Be  interested  directly  or indirectly in any premises where any
   26  alcoholic beverage is sold at retail; or in any business devoted  wholly
   27  or  partially  to  the sale of any alcoholic beverage at retail by stock
   28  ownership, interlocking directors, mortgage or lien or any  personal  or
   29  real  property,  or by any other means. The provisions of this paragraph
   30  shall not apply to:
   31    (i) any such premises or business constituting the  overnight  lodging
   32  and  resort facility located wholly within the boundaries of the town of
   33  North Elba, county of Essex, township eleven,  Richard's  survey,  great
   34  lot  numbers  two  hundred  seventy-eight, two hundred seventy-nine, two
   35  hundred eighty, two hundred ninety-eight, two hundred ninety-nine, three
   36  hundred, three hundred eighteen, three hundred nineteen,  three  hundred
   37  twenty,  three  hundred  thirty-five  and  three hundred thirty-six, and
   38  township twelve, Thorn's survey, great lot numbers one hundred  six  and
   39  one  hundred  thirteen,  as shown on the Adirondack map, compiled by the
   40  conservation department of the state of  New  York  -  nineteen  hundred
   41  sixty-four  edition,  in  the Essex county atlas at page twenty-seven in
   42  the Essex county clerk's office, Elizabethtown, New York, provided  that
   43  such facility maintains not less than two hundred fifty rooms and suites
   44  for overnight lodging[,];
   45    (ii)  any such premises or business constituting the overnight lodging
   46  and resort facility located wholly within the boundaries of  that  tract
   47  or parcel of land situate in the city of Canandaigua, county of Ontario,
   48  beginning  at a point in the northerly line of village lot nine where it
   49  meets with South Main Street, thence south sixty-nine degrees fifty-four
   50  minutes west  a  distance  of  nine  hundred  sixteen  and  twenty-three
   51  hundredths  feet to an iron pin; thence in the same course a distance of
   52  fourteen feet to an iron pin; thence in the same course  a  distance  of
   53  fourteen  and  four-tenths feet to a point; thence south fifteen degrees
   54  thirty-eight minutes and forty seconds east a distance of  four  hundred
   55  forty-six  and  eighty-seven  hundredths  feet  to a point; thence south
   56  twenty-eight degrees thirty-seven  minutes  and  fifty  seconds  east  a
       S. 2609--A                         53                         A. 3009--A
    1  distance  of  one  hundred thirteen and eighty-four hundredths feet to a
    2  point; thence south eighty-five degrees and forty-seven minutes  east  a
    3  distance  of  forty-seven  and sixty-one hundredths feet to an iron pin;
    4  thence  on  the  same  course a distance of three hundred and sixty-five
    5  feet to an iron pin; thence north seventeen degrees  twenty-one  minutes
    6  and  ten seconds east a distance of four hundred fifty-seven and thirty-
    7  two hundredths feet to an iron pin; thence north  nineteen  degrees  and
    8  thirty  minutes west a distance of two hundred and forty-eight feet to a
    9  point; thence north sixty-nine degrees and  fifty-four  minutes  east  a
   10  distance  of two hundred eighty-four and twenty-six hundredths feet to a
   11  point; thence north nineteen degrees and thirty minutes west a  distance
   12  of  sixty  feet  to the point and place of beginning, provided that such
   13  facility maintains not less than one hundred twenty rooms and suites for
   14  overnight lodging[,];
   15    (iii) any such premises or business constituting the overnight lodging
   16  facility located wholly within the boundaries of that tract or parcel of
   17  land situated in the borough of Manhattan, city and county of New  York,
   18  beginning  at  a point on the northerly side of west fifty-fourth street
   19  at a point one hundred feet easterly from the intersection of  the  said
   20  northerly  side  of  west  fifty-fourth  street and the easterly side of
   21  seventh avenue; running thence northerly and parallel with the  easterly
   22  side  of  seventh avenue one hundred feet five inches to the center line
   23  of the block; running thence easterly and parallel  with  the  northerly
   24  side  of west fifty-fourth street and along the center line of the block
   25  fifty feet to a point; running thence northerly and  parallel  with  the
   26  easterly  side  of  seventh  avenue  one hundred feet five inches to the
   27  southerly side of west fifty-fifth street at a point distant one hundred
   28  fifty feet easterly from the intersection of the said southerly side  of
   29  west fifty-fifth street and the easterly side of seventh avenue; running
   30  thence  easterly  along  the  southerly  side of west fifty-fifth street
   31  thirty-one feet three inches to a point; running  thence  southerly  and
   32  parallel  with  the easterly side of the seventh avenue one hundred feet
   33  five inches to the center line of the  block;  running  thence  easterly
   34  along  the center line of the block and parallel with the southerly side
   35  of west fifty-fifth street, one hundred feet; running  thence  northerly
   36  and  parallel  with the easterly side of seventh avenue one hundred feet
   37  five inches to the southerly side of west  fifty-fifth  street;  running
   38  thence  easterly  along  the  southerly  side of west fifty-fifth street
   39  twenty-one feet ten and one-half  inches  to  a  point;  running  thence
   40  southerly  and  parallel  with  the  easterly side of seventh avenue one
   41  hundred feet five inches to the center line of the block; running thence
   42  westerly along the center line of the block and parallel with the north-
   43  erly side of west fifty-fourth street three feet one and one-half  inch-
   44  es;  running  thence  southerly  and  parallel with the easterly side of
   45  seventh avenue one hundred feet five inches to  the  northerly  side  of
   46  west  fifty-fourth street at a point distant three hundred feet easterly
   47  from the intersection of the said northerly side  of  west  fifty-fourth
   48  street  and the easterly side of seventh avenue; running thence westerly
   49  and along the northerly side of west  fifty-fourth  street  two  hundred
   50  feet  to  the  point  or place of beginning, provided that such facility
   51  maintains not less than four hundred guest rooms and  suites  for  over-
   52  night lodging[,];
   53    (iv)  any such premises or business located on that tract or parcel of
   54  land, or any subdivision thereof, situate in the Village of Lake Placid,
   55  Town of North Elba, Essex County, New York; it being also a part of  Lot
   56  No.    279,  Township  No.  11, Old Military Tract, Richard's Survey; it
       S. 2609--A                         54                         A. 3009--A
    1  being also all of Lot No. 23 and part of Lot No. 22 as shown and  desig-
    2  nated  on a certain map entitled "Map of Building Sites for Sale by B.R.
    3  Brewster" made by G.T. Chellis C.E. in 1892; also being PARCEL No. 1  on
    4  a  certain  map  of  lands  of  Robert  J. Mahoney and wife made by G.C.
    5  Sylvester, P.E.  & L.S.  # 21300, dated August 4, 1964, and filed in the
    6  Essex County Clerk's Office on August 27, 1964,  and  more  particularly
    7  bounded  and  described as follows; BEGINNING at the intersection of the
    8  northerly bounds of  Shore  Drive  (formerly  Mirror  Street)  with  the
    9  westerly  bounds  of  Park  Place (formerly Rider Street) which point is
   10  also the northeast corner of Lot No. 23, from thence South  21 50'  East
   11  in  the  westerly  bounds  of Park Place a distance of 119 feet, more or
   12  less, to a lead plug in the edge of the sidewalk marking  the  southeast
   13  corner of Lot No. 23 and the northeast corner of Lot No. 24; from thence
   14  South  68 00'50"  West  a  distance of 50.05 feet to an iron pipe set in
   15  concrete at the corner of Lots 23 and 22; from  thence  South  65 10'50"
   16  West  a  distance  of 7.94 feet along the south line of Lot No. 22 to an
   17  iron pipe for a corner; from thence North 23 21'40" West  and  at  17.84
   18  feet  along  said line passing over a drill hole in a concrete sidewalk,
   19  and at 68.04 feet further along said line passing over an iron  pipe  at
   20  the  southerly  edge of another sidewalk, and at 1.22 feet further along
   21  said line passing over  another  drill  hole  in  a  sidewalk,  a  total
   22  distance  of  119  feet, more or less, to the northerly line of Lot. No.
   23  22; from thence easterly in the northerly line of Lot 22 and 23  to  the
   24  northeast  corner of Lot No. 23 and the point of beginning. Also includ-
   25  ing the lands to the center of Shore Drive included between the norther-
   26  ly straight line continuation of the side lines of the  above  described
   27  parcel,  and  to  the  center  of  Park Place, where they abut the above
   28  described premises SUBJECT to the use thereof for street purposes. Being
   29  the same premises conveyed by Morestuff, Inc.  to  Madeline  Sellers  by
   30  deed dated June 30, 1992, recorded in the Essex County Clerk's Office on
   31  July 10, 1992 in Book 1017 of Deeds at Page 318;
   32    (v)  any  such  premises  or business located on that certain piece or
   33  parcel of land, or any subdivision thereof, situate, lying and being  in
   34  the  Town of Plattsburgh, County of Clinton, State of New York and being
   35  more particularly bounded and described as follows: Starting at an  iron
   36  pipe  found in the easterly bounds of the highway known as the Old Mili-
   37  tary Turnpike, said iron pipe being located 910.39  feet  southeasterly,
   38  as measured along the easterly bounds of said highway, from the souther-
   39  ly  bounds  of  the  roadway  known  as  Industrial Parkway West, THENCE
   40  running S 31   54' 33" E along the easterly bounds of said Old  Military
   41  Turnpike  Extension,  239.88  feet to a point marking the beginning of a
   42  curve concave to the west; thence southerly along said curve,  having  a
   43  radius  of  987.99  feet,  248.12 feet to an iron pipe found marking the
   44  point of beginning for the parcel herein  being  described,  said  point
   45  also  marked  the  southerly  corner of lands of Larry Garrow, et al, as
   46  described in Book 938 of Deeds at page 224; thence N 07  45' 4" E  along
   47  the  easterly  bounds  of  said  Garrow, 748.16 feet to a 3"x4" concrete
   48  monument marking the northeasterly corner of said Garrow, the  northwes-
   49  terly corner of the parcel herein being described and said monument also
   50  marking  the  southerly  bounds  of  lands  of  Salerno Plastic Corp. as
   51  described in Book 926 of Deeds at Page 186; thence S 81  45' 28" E along
   52  a portion of the southerly bounds of said Salerno Plastic Corp.,  441.32
   53  feet to an iron pin found marking the northeasterly corner of the parcel
   54  herein  being  described  and  also  marking the northwest corner of the
   55  remaining lands now or formerly owned by said Marx and Delaura; thence S
   56  07  45' 40" W along the Westerly bounds of lands now of formerly of said
       S. 2609--A                         55                         A. 3009--A
    1  Marx and DeLaura and along the easterly  bounds  of  the  parcel  herein
    2  being  described,  560.49  feet  to  an iron pin; thence N 83  43' 21" W
    3  along a portion of the remaining lands of said Marx and  DeLaura,  41.51
    4  feet  to  an  iron  pin;  thence S 08  31' 30" W, along a portion of the
    5  remaining lands of said Marx and Delaura, 75.01  feet  to  an  iron  pin
    6  marking northeasterly corner of lands currently owned by the Joint Coun-
    7  cil  for Economic Opportunity of Plattsburgh and Clinton County, Inc. as
    8  described in Book 963 of Deeds at Page 313; thence N 82  20' 32" W along
    9  a portion of the northerly bounds of said J.C.E.O., 173.50  feet  to  an
   10  iron pin; thence 61  21' 12" W, continuing along a portion of the north-
   11  erly  bounds  of said J.C.E.O., 134.14 feet to an iron pin; thence S 07
   12  45' 42" W along the westerly bounds of said J.C.E.O., 50 feet to an iron
   13  pin; thence S 66  48' 56" W along a portion of the northerly  bounds  of
   14  remaining  lands  of  said Marx and DeLaura, 100.00 feet to an iron pipe
   15  found on the easterly bounds of the aforesaid highway,  said  from  pipe
   16  also  being  located  on a curve concave to the west; thence running and
   17  running northerly along the easterly bounds of the aforesaid highway and
   18  being along said curve, with the curve having a radius of  987.93  feet,
   19  60.00 feet to the point of beginning and containing 6.905 acres of land.
   20  Being  the  same  premises  as conveyed to Ronald Marx and Alice Marx by
   21  deed of CIT Small Business Lending Corp., as agent of the administrator,
   22  U.S. Small Business Administration,  an  agency  of  the  United  States
   23  Government  dated  September  10, 2001 and recorded in the office of the
   24  Clinton County Clerk on September 21, 2001 as Instrument #135020; [or]
   25    (vi) any such premises or business located on the  west  side  of  New
   26  York  state  route  414 in military lots 64 and 75 located wholly within
   27  the boundaries of that tract or parcel of land situated in the  town  of
   28  Lodi, county of Seneca beginning at an iron pin on the assumed west line
   29  of New York State Route 414 on the apparent north line of lands reputed-
   30  ly  of  White (lib. 420, page 155); said iron pin also being northerly a
   31  distance of 1200 feet more or less from the centerline of  South  Miller
   32  Road;  Thence leaving the point of beginning north 85-17'-44" west along
   33  said lands of White a distance of 2915.90 feet to  an  iron  pin  Thence
   34  north 03-52'-48" east along said lands of White, passing through an iron
   35  pin 338.36 feet distant, and continuing further along that same course a
   36  distance  of 13.64 feet farther, the total distance being 352.00 feet to
   37  a point in the assumed centerline of Nellie Neal Creek; Thence in gener-
   38  ally a north westerly direction  the  following  courses  and  distances
   39  along the assumed centerline of Nellie Neal Creek; north 69-25'-11" west
   40  a  distance  of 189.56 feet to a point; north 63-40'-00" west a distance
   41  of 156.00 feet to a point; north 49-25'-00" west  a  distance  of  80.00
   42  feet  to  a  point;  south 80-21'-00" west a distance of 90.00 feet to a
   43  point; north 72-03'-00" west a distance of 566.00 feet to a point; north
   44  68-15'-00" west a distance of 506.00 feet to a point;  north  55-16'-00"
   45  west  a  distance  of  135.00  feet  to a point; south 69-18'-00" west a
   46  distance of 200.00 feet to a point; south 88-00'-00" west a distance  of
   47  170.00  feet  to a point on a tie line at or near the high water line of
   48  Seneca Lake; Thence north 25-17'-00" east along said tie line a distance
   49  of 238.00 feet to an iron pipe; Thence south 82-04'-15" east along lands
   50  reputedly of M. Wagner (lib. 464, page 133) a distance of 100.00 feet to
   51  an iron pin; Thence north 06-56'-47" east along said lands of M.  Wagner
   52  a  distance of 100.00 feet to an iron pipe; Thence north 09-34'-28" east
   53  along lands reputedly of Schneider (lib. 429, page  37)  a  distance  of
   54  50.10  feet  to  an  iron pipe; Thence north 07-49'-11" east along lands
   55  reputedly of Oney (lib. 484, page 24) a distance of  50.00  feet  to  an
   56  iron  pipe;  Thence  north  82-29'-40"  west  along said lands of Oney a
       S. 2609--A                         56                         A. 3009--A
    1  distance of 95.30 feet to an iron pipe on a tie  line  at  or  near  the
    2  highwater  line  of Seneca Lake; Thence north 08-15'-22" east along said
    3  tie line a  distance  of  25.00  feet  to  an  iron  pin;  Thence  south
    4  82-28'-00"  east  along  lands  reputedly  of  Yu (lib. 405, page 420) a
    5  distance of 96.53 feet to an iron pipe;  Thence  north  34-36'-59"  east
    6  along  said  lands  of  Yu  a  distance  of 95.00 feet to a point in the
    7  assumed centerline of Van Liew Creek; Thence in  generally  an  easterly
    8  direction  the following courses and distances along the assumed center-
    9  line of Van Liew Creek; north 72-46'-37" east a distance of 159.98  feet
   10  to  a  point; north 87-53'-00" east a distance of 94.00 feet to a point;
   11  south 71-12'-00" east a  distance  of  52.00  feet  to  a  point;  south
   12  84-10'-00"  east  a distance of 158.00 feet to a point; south 59-51'-00"
   13  east a distance of 160.00 feet to  a  point;  south  83-29'-00"  east  a
   14  distance  of  187.00 feet to a point; Thence north 01-33'-40" east along
   15  lands reputedly of Hansen (lib. 515, page 205) passing through  an  iron
   16  pipe  32.62  feet distant, and continuing further along that same course
   17  passing through an iron pin 205.38 feet farther,  and  continuing  still
   18  further  along  that  same  course a distance of 21.45 feet farther, the
   19  total distance being 259.45 feet to the assumed remains of a  White  Oak
   20  stump;  Thence  north  69-16'-11" east along lands reputedly of Schwartz
   21  (lib. 374, page 733) being tie lines along the top of the south bank  of
   22  Campbell  Creek  a  distance  of  338.00  feet  to a point; Thence south
   23  57-17'32" east along said tie line a distance of 136.60 feet to a point;
   24  Thence south 74-45'-00" east along said tie line a  distance  of  100.00
   25  feet  to  an  iron pin; Thence north 04-46'-00" east along said lands of
   26  Schwartz a distance of 100.00 feet to a point in the assumed  centerline
   27  of Campbell Creek; Thence in generally an easterly direction the follow-
   28  ing  courses  and  distances  along  the  assumed centerline of Campbell
   29  Creek; south 71-34'-00" east a distance of 330.00 feet to a point; north
   30  76-53'-00" east a distance of 180.00 feet to a  point;  north  83-05'00"
   31  east  a  distance  of  230.00  feet  to a point; south 66-44'-00" east a
   32  distance of 90.00 feet to a point; south 81-10'-00" east a  distance  of
   33  240.00  feet  to a point; south 45-29'-15" east a distance of 73.18 feet
   34  to a point; Thence south 05-25'-50" west along lands reputedly of  Stan-
   35  ley  Wagner (lib. 450, page 276) a distance of 135.00 feet to a point on
   36  the assumed north line of Military Lot 75; Thence south 84-34'-10"  east
   37  along said lands of Wagner and the assumed north line of Military Lot 75
   38  a  distance  of 1195.06 feet to an iron pin; Thence south O6-57'52" west
   39  along said lands of M. Wagner (lib. 414, page 267)  passing  through  an
   40  iron  pin  215.58  feet  distant, and continuing further along that same
   41  course a distance of 20.59 feet farther, the total distance being 236.17
   42  feet to a point in the assumed centerline of Campbell Creek;  Thence  in
   43  generally  a south easterly direction the following course and distances
   44  along the assumed centerline of Campbell Creek; north 78-23'-09" east  a
   45  distance  of  29.99 feet to a point; south 46-09'-15" east a distance of
   46  65.24 feet to a point; north 85-55'-09" east a distance of 60.10 feet to
   47  a point; south 61-59'-50" east a distance of 206.91  feet  to  a  point;
   48  north  63-58'-27"  east  a  distance  of  43.12  feet  to a point; south
   49  28-51'-21" east a distance of 47.72 feet to a  point;  south  15-14'-08"
   50  west  a  distance  of  33.42  feet  to  a point; south 79-16'-32" east a
   51  distance of 255.15 feet to a point; south 62-19'-46" east a distance  of
   52  75.82 feet to a point; north 76-10'-42" east a distance of 99.60 feet to
   53  a point; north 82-12'55" east a distance of 86.00 feet to a point; south
   54  44-13'53"  east  a  distance  of 64.08 feet to a point; north 67-52'-46"
   55  east a distance of 73.98 feet  to  a  point;  north  88-13'-13"  east  a
   56  distance  of  34.64 feet to a point on the assumed west line of New York
       S. 2609--A                         57                         A. 3009--A
    1  State Route 414; Thence south 20-13'-30" east  along  the  assumed  west
    2  line of New York State Route 414 a distance of 248.04 feet to a concrete
    3  monument;  Thence  south 02-10'-30" west along said road line a distance
    4  of  322.90  feet  to an iron pin; Thence 13-14'-50" west along said road
    5  line a distance of 487.41 feet to an iron pin, said iron pin  being  the
    6  point  and  place  of  beginning; Comprising an area of 126.807 acres of
    7  land according to a survey completed  by  Michael  D.  Karlsen  entitled
    8  "Plan  Owned  by  Stanley  A.    Wagner" known as Parcel A of Job number
    9  98-505.  This survey is subject to all utility easements  and  easements
   10  and  right-of-ways  of record which may affect the parcel of land.  This
   11  survey is also subject to the rights of the public in and to lands here-
   12  in referred to as New York State Route 414.    This  survey  intends  to
   13  describe  a  portion  of  the  premises as conveyed by Ruth V. Wagner to
   14  Stanley A. Wagner by deed recorded February 10, 1989  in  Liber  450  of
   15  deeds,  at  Page 286.  This survey also intends to describe a portion of
   16  the premises as conveyed by Stanley W. VanVleet to Stanley A. Wagner  by
   17  deed recorded April 30, 1980 in Liber 385 of Deeds, at Page 203.
   18   ALSO ALL THAT OTHER TRACT OR PARCEL OF LAND SITUATE on the east side of
   19  New  York State Route 414 in Military Lot 75 in the Town of Lodi, County
   20  of Seneca, State of New York bounded and described as follows:    Begin-
   21  ning  at  an  iron  pin on the assumed east line of New York State Route
   22  414, said iron pin being north 50-44'-57" east a distance of 274.92 feet
   23  from the south east corner of the parcel of land herein above described;
   24  Thence leaving the point of beginning north 00-26'01" east along a math-
   25  ematical tie line a distance of 504.91 feet to an iron pin; Thence south
   26  37-00'-20" east along lands reputedly of Tomberelli (lib. 419, page 243)
   27  passing through an iron pin 176.00 feet distant, and continuing  further
   28  along  that  same  course  a  distance  of  2.01 feet farther, the total
   29  distance being 178.01 feet to a  point;  Thence  south  09-03'-55"  west
   30  along  lands  reputedly  of M. Wagner (lib. 491, page 181) a distance of
   31  68.19 feet to an iron pipe; Thence  south  15-36'-04"  west  along  said
   32  lands  of  M.  Wagner  a distance of 300.15 feet to an iron pipe; Thence
   33  south 72-04'-59" west along said lands of M. Wagner a distance of  20.49
   34  feet  to  an iron pin, said iron pin being the point and place of begin-
   35  ning.  Comprising an area of 0.727 acre of lands according to  a  survey
   36  completed  by Michael D. Karlsen entitled "Plan of Land Owned by Stanley
   37  A. Wagner" known as Parcel B of job  number  98-505.    This  survey  is
   38  subject  to  all  utility  easements  and easements and right-of-ways of
   39  record which may affect this parcel  of  land.    This  survey  is  also
   40  subject  to  the rights of the public in and to lands herein referred to
   41  as New York State Route 414.  This survey intends to describe  the  same
   42  premises  as  conveyed  by Henry W. Eighmey as executor of the Last Will
   43  and Testament of Mary C. Eighmey to Stanley A. Wagner by  deed  recorded
   44  July  2,  1996  in  liber  542,  page  92.   This survey also intends to
   45  describe a portion of the premises as conveyed  by  Ruth  V.  Wagner  to
   46  Stanley  A.  Wagner  by  deed recorded February 10, 1989 in Liber 450 of
   47  deeds, at Page 286[.];
   48    [The provisions of this paragraph shall not apply to] (VII) any  prem-
   49  ises  or  business located wholly within the following described parcel:
   50  ALL THAT TRACT OR PARCEL OF LAND situate in the City of Corning,  County
   51  of  Steuben  and  State  of  New  York bounded and described as follows:
   52  Beginning at an iron pin situate at the terminus of the westerly line of
   53  Townley Avenue at its intersection with the southwesterly  line  of  New
   54  York  State  Route 17; thence S 00  45' 18" E along the westerly line of
   55  Townley Avenue, a distance of 256.09 feet to a point; thence S  89   02'
   56  07"  W  through an iron pin placed at a distance of 200.00 feet, a total
       S. 2609--A                         58                         A. 3009--A
    1  distance of 300.00 feet to an iron  pin;  thence  N  00   59'  17"  W  a
    2  distance of 47.13 feet to an iron pin; thence S 89  02' 07" W a distance
    3  of  114.56 feet to a point situate in the southeast corner of Parcel A-2
    4  as set forth on a survey map hereinafter described; thence N 14  18' 49"
    5  E  a  distance  of  124.40  feet to an iron pin situate at the southeast
    6  corner of lands now or formerly of Cicci (Liber 923, Page 771); thence N
    7  14  18' 49" E a distance of 76.46 feet to an iron pin; thence N 00   57'
    8  53"  W  a  distance  of  26.25 feet to an iron pin marking the southeast
    9  corner of parcel A-1 as set forth on the  hereinafter  described  survey
   10  map;  thence N 00  58' 01" W a distance of 166.00 to an iron pin situate
   11  at the northeast corner of said Parcel A-1, which  pin  also  marks  the
   12  southeast  corner  of lands now or formerly of Becraft (Liber 1048, Page
   13  1086); thence N 00  57' 53" W a distance of 106.00 feet to an  iron  pin
   14  situate  in  the  southerly  line of lands now or formerly of the United
   15  States Postal Service; thence N 89  02' 07" E along the  southerly  line
   16  of  said  United  States  Postal  Service  a distance of 81.47 feet to a
   17  point; thence N 14  18' 49" E along the easterly  line  of  said  United
   18  States  Postal  Service a distance of 114.29 feet to an iron pin situate
   19  in the southwesterly line of New York State Route 17; thence S  32   00'
   20  31"  E  along  the  southwesterly  line  of  New  York State Route 17, a
   21  distance of 358.93 feet to an iron  pin;  thence  continuing  along  the
   22  southwesterly  line  of  New  York  state  Route  17,  S 38  30' 04" E a
   23  distance of 108.18 feet to the iron pin marking the place of  beginning.
   24  Said  premises  are  set forth and shown as approximately 4.026 acres of
   25  land designated as Parcel A (excluding Parcels A-1 and A-2) on a  survey
   26  map  entitled  "As-Built  Survey  of Lands of New York Inn, LLC, City of
   27  Corning, Steuben County, New York" by Weiler Associates, dated  December
   28  27, 2001, designated Job No. 12462; [or (vii)]
   29    (VIII)  any  such premises or businesses located on that certain plot,
   30  piece or parcel of land, situate, lying and being in the Second Ward  of
   31  the  City of Schenectady, on the Northerly side of Union Street, bounded
   32  and described as follows: to wit; Beginning at the Southeasterly  corner
   33  of  the lands lately owned by Elisha L. Freeman and now by Albert Shear;
   34  and running from thence Easterly along the line of Union Street, 44 feet
   35  to the lands now owned by or in the possession of James  G.  Van  Vorst;
   36  thence  Northerly  in a straight line along the last mentioned lands and
   37  the lands of the late John Lake, 102 feet to the lands of one Miss Rodg-
   38  ers; thence Westerly along the line of the last mentioned lands of  said
   39  Rodgers  to  the lands of the said Shear; and thence Southerly along the
   40  lands of said Shear 101 feet, 6 inches to Union  Street,  the  place  of
   41  beginning.
   42    Also  all  that  tract  or parcel of land, with the buildings thereon,
   43  situate in the City of Schenectady, County of Schenectady, and State  of
   44  New  York,  situate  in  the First, formerly the Second Ward of the said
   45  City, on the Northerly side of  Union  Street,  which  was  conveyed  by
   46  William  Meeker  and  wife to Elisha L. Freeman by deed dated the second
   47  day of December 1843, and recorded in the Clerk's Office of  Schenectady
   48  County on December 5, 1843, in Book V of Deeds at page 392, which lot in
   49  said  deed  is bounded and described as follows: Beginning at a point in
   50  the Northerly line of Union Street where it is intersected by the  East-
   51  erly  line  of  property  numbered  235  Union  Street,  which is hereby
   52  conveyed, and running thence Northerly along the Easterly line  of  said
   53  property,  One  Hundred  Forty  and  Five-tenths (140.5) feet to a point
   54  sixteen (16) feet Southerly from the Southerly line of  the  new  garage
   55  built  upon  land  adjoining on the North; thence Westerly parallel with
   56  said garage, Forty-six and Seven-tenths (46.7)  feet;  thence  Southerly
       S. 2609--A                         59                         A. 3009--A
    1  One  Hundred Forty and Eight-tenths (140.8) feet to the Northerly margin
    2  of Union Street; thence Easterly along the  Northerly  margin  of  Union
    3  Street,  about  Forty-eight and three-tenths (48.3) feet to the point or
    4  place of beginning.  The two above parcels are together more particular-
    5  ly  described  as follows:  All that parcel of land in the City of Sche-
    6  nectady beginning at a point in the northerly margin of Union Street  at
    7  the southwesterly corner of lands now or formerly of Friedman (Deed Book
    8  636  at  page 423) which point is about 60 feet westerly of the westerly
    9  line of North College Street and runs thence N. 86 deg. 42' 20" W. 92.30
   10  feet to the southeasterly corner of  other  lands  now  or  formerly  of
   11  Friedman  (Deed  Book  798  at  page  498); thence N. 04 deg. 06' 48" E.
   12  140.50 feet to the southwesterly corner of  lands  now  or  formerly  of
   13  Stockade  Associates (Deed Book 1038 at page 521); thence S. 87 deg. 05'
   14  27" E. 46.70 feet to lands now or formerly of McCarthy (Deed  Book  1129
   15  at  page  281); thence along McCarthy S. 00 deg. 52' 02" E. 3.69 feet to
   16  the northwesterly corner of lands now or formerly of SONYMA  (Deed  Book
   17  1502  at  page  621);  thence  along  lands  of SONYMA S. 02 deg 24' 56"
   18  W.34.75 feet to a corner; thence still along lands of SONYMA  and  lands
   19  now  or formerly of Magee (Deed Book 399 at page 165) S. 86 deg. 11' 52"
   20  E. 42.57 feet to a corner; thence still along lands of Magee  and  Lands
   21  of  Friedman  first above mentioned S. 03 deg. 10' 08" W. 102.00 feet to
   22  the point of beginning.  Excepting and reserving all that portion of the
   23  above parcel lying easterly of a line described as follows:    All  that
   24  tract  or parcel of land, situated in the City of Schenectady and County
   25  of Schenectady and State of New York, on the  Northerly  side  of  Union
   26  Street  bounded  and  described as follows:  Beginning at a point in the
   27  northerly line of Union Street, said point being in  the  division  line
   28  between lands now or formerly of Electric Brew Pubs, Inc. (1506 of Deeds
   29  at  page  763)  on the West and lands now or formerly of Margaret Wexler
   30  and Donna Lee Wexler Pavlovic, as trustees under Will of Ruth F.  Wexler
   31  (Street  number  241 Union Street) on the East; thence North 03 deg. 04'
   32  10" East, along the building known as Street No.  241  Union  Street,  a
   33  distance  of  30.50  feet to a point; thence North 88 deg. 45' 45" West,
   34  along said building and building eve, a  distance  of  5.62  feet  to  a
   35  point;  thence  North  03  deg. 03' 30" East, along said building eve of
   36  Street No. 241 Union Street, a distance of 32.74 feet; thence  South  88
   37  deg. 45' 45" East, along said building eve, a distance of 1.2 feet to an
   38  intersection  of  building  corner  of Street No. 241 Union Street and a
   39  brick wall; thence north 03 deg. 37' 30" East, along said brick wall,  a
   40  distance  of  14.47  feet  to  a  point in the corner of the brick wall,
   41  thence South 86 deg. 46' 45" East along said brick wall  a  distance  of
   42  4.42  feet  to  the  intersection  of  brick wall with the boundary line
   43  between the Electric Brew Pubs, Inc. (aforesaid) on the West  and  lands
   44  of  Margaret  Wexler  and  Donna Lee Wexler Pavlovic, (aforesaid) on the
   45  East; thence North 03 deg 10' 08" East a distance of 0.62  feet  to  the
   46  Northeast  corner  of  lands  belonging to Margaret Wexler and Donna Lee
   47  Wexler Pavlovic.  Also all that tract or parcel of land  commonly  known
   48  as the Union Street School, located on the Northeasterly corner of Union
   49  and  North  College  Streets in the First Ward of the City and County of
   50  Schenectady and  State  of  New  York,  more  particularly  bounded  and
   51  described as follows:  Beginning at a point in the Northerly street line
   52  of  Union  Street where it is intersected by the Easterly street line of
   53  North College Street, and  runs  thence  Northerly  along  the  Easterly
   54  street  line  of North College Street, one hundred seven and five-tenths
   55  (107.5) feet to a point, thence easterly at  an  angle  of  ninety  (90)
   56  degrees,  one  hundred  ninety-one  and seventy-five hundredths (191.75)
       S. 2609--A                         60                         A. 3009--A
    1  feet to a point in the  Northwesterly  street  line  of  Erie  Boulevard
    2  thence  southwesterly along the Northwesterly street line of Erie Boule-
    3  vard, one hundred twenty-three and  eight-tenths  (123.8)  feet  to  its
    4  intersection  with  the  Northerly  street  line of Union Street; thence
    5  Westerly along the Northerly street line of Union  Street,  one  hundred
    6  twenty-four  and  fifty-five  hundredths  (124.55)  feet to the point or
    7  place of beginning.
    8    The above described parcel of property includes the Blue  Line  parcel
    9  of  land,  which is a portion of the abandoned Erie Canal Lands, located
   10  in the First Ward of the City of Schenectady, New York, and  which  Blue
   11  Line parcel lies between the Northwesterly line of Erie Boulevard as set
   12  forth  in the above described premises and the Northeasterly lot line of
   13  the old Union Street School as it runs parallel with  the  Northwesterly
   14  line of Erie Boulevard as aforesaid.
   15    The  two  above  parcels  are  together more particularly described as
   16  follows: All that parcel of land in the City of Schenectady beginning at
   17  a point in the northerly margin of Union Street  and  the  northwesterly
   18  margin  of  Erie Boulevard and runs thence along Union Street N. 86 deg.
   19  42' 20" W. 124.55 feet to the easterly margin of North  College  Street;
   20  thence  along  North  College Street N. 05 deg 04' 40" E. 107.50 feet to
   21  the southeasterly corner of lands now or formerly of McCarthy (Deed Book
   22  1129 at page 279); thence along McCarthy, Cottage Alley and lands now or
   23  formerly of McGregor (Deed Book 912 at page 624) S. 84 deg. 55'  20"  E.
   24  191.75  feet to the northwesterly margin of Erie Boulevard; thence along
   25  Erie Boulevard S. 38 deg. 03' 53" W. 123.54 feet to the point of  begin-
   26  ning; [or (viii)]
   27    (IX)  any  such premises or businesses located on that tract or parcel
   28  of land situate in the Town of Hopewell, Ontario County,  State  of  New
   29  York, bounded and described as follows: Commencing at a 5/8" rebar found
   30  on  the  division line between lands now or formerly of Ontario County -
   31  Finger Lakes Community College (Liber 698 of Deeds,  Page  466)  on  the
   32  north  and  lands now or formerly of James W. Baird (Liber 768 of Deeds,
   33  Page 1109) on the south; thence, North 43 -33'-40" West, on  said  divi-
   34  sion  line,  a distance of 77.32 feet to the Point of Beginning. Thence,
   35  North 43 -33'-40" West, continuing on said  division  line  and  through
   36  said  lands  of  Ontario County, a distance of 520.45 feet to a point on
   37  the southeasterly edge  of  an  existing  concrete  pad;  thence,  South
   38  74 -19'-53"  West, along said edge of concrete and the projection there-
   39  of, a distance of 198.78 feet to a point on the easterly edge  of  pave-
   40  ment  of an existing campus drive; thence, the following two (2) courses
   41  and distances along said edge of pavement: Northeasterly on a  curve  to
   42  the  left  having  a  radius  of  2221.65 feet, a chord bearing of North
   43  30 -16'-39" East, a  chord  distance  of  280.79,  a  central  angle  of
   44  07 -14'-47",  a  length  of 280.98 feet to a point of reverse curvature;
   45  thence, Northeasterly on a curve to the right having a radius of  843.42
   46  feet,  a  chord  bearing  of North 45 -25'-09" East, a chord distance of
   47  534.08, a central angle of 36 -55'-01", a length of  543.43  feet  to  a
   48  point;  thence,  South 30 -04'-59" East, a distance of 18.28 feet to the
   49  corner of the property acquired by Ontario County (Liber 766  of  Deeds,
   50  Page  1112),  as  shown  on a map recorded in the Ontario County Clerk's
   51  Office as Map No. 6313; thence,  the  following  four  (4)  courses  and
   52  distances  along  said property line: South 30 -04'-59" East, a distance
   53  of 177.17 feet to a point; thence, South 02 -20'-33" East, a distance of
   54  147.53 feet to a point; thence, South 41 -31'-35" East,  a  distance  of
   55  200.93 feet to a point; thence, South 23 -48'-53" West, along said prop-
   56  erty  line,  and the projection thereof, through the first said lands of
       S. 2609--A                         61                         A. 3009--A
    1  Ontario County - Finger Lakes Community College  (Liber  698  of  Deeds,
    2  Page  466), a distance of 517.96 feet to Point of Beginning. Said parcel
    3  containing 7.834 acres, more  or  less,  as  shown  on  a  map  entitled
    4  "Proposed  Lease  Area  -  Friends  of  the Finger Lakes Performing Arts
    5  Center, Hopewell, NY", prepared by Bergmann Associates,  drawing  LM-01,
    6  dated June 10, 2005, last revised August 17, 2005. The related PAC Prop-
    7  erties  are  shown  on  the Map denominated "FLCC Campus Property, FLPAC
    8  Ground Lease, Parking, Vehicular & Pedestrian Access", recorded  in  the
    9  Ontario County Clerk's Office on December 10, 2009 in Book 1237 of Deeds
   10  at  page  9 and are comprised of the areas separately labeled as Parking
   11  Lot 'A', Parking Lot 'G', the Ticket Booth area, the Sidewalks, and  the
   12  Entry Roads[.];
   13    (X)  ANY  PREMISES  LICENSED PURSUANT TO SECTION SIXTY-THREE-B OF THIS
   14  CHAPTER.
   15    [The provisions of this paragraph shall not apply to] (XI)  any  prem-
   16  ises  licensed  under  section  sixty-four  of  this  chapter in which a
   17  manufacturer or wholesaler holds a direct or indirect interest, provided
   18  that: [(I)] (1) said premises consist of  an  interactive  entertainment
   19  facility  which  predominantly  offers  interactive  computer  and video
   20  entertainment attractions,  and  other  games  and  also  offers  themed
   21  merchandise  and  food  and  beverages, [(II)] (2) the sale of alcoholic
   22  beverages within the premises shall be restricted to an area  consisting
   23  of not more than twenty-five percent of the total interior floor area of
   24  the premises, [(III)] (3) the retail licenses shall derive not less than
   25  sixty-five  percent  of the total revenue generated by the facility from
   26  interactive video entertainment activities and  other  games,  including
   27  related  attractions  and sales of merchandise other than food and alco-
   28  holic beverages, [(IV)] (4) the interested manufacturer  or  wholesaler,
   29  or its parent company, shall be listed on a national securities exchange
   30  and  its direct or indirect equity interest in the retail licensee shall
   31  not exceed twenty-five percent, [(V)] (5) no more than  fifteen  percent
   32  of  said  licensee's  purchases  of  alcoholic beverages for sale in the
   33  premises shall be products produced or distributed by  the  manufacturer
   34  or wholesaler, [(VI)] (6) neither the name of the manufacturer or whole-
   35  saler  nor  the  name  of  any  brand  of alcoholic beverage produced or
   36  distributed by said manufacturer or wholesaler shall be part of the name
   37  of the premises, [(VII)] (7) the name of the manufacturer or  wholesaler
   38  or  the  name  of  products  sold or distributed by such manufacturer or
   39  wholesaler shall not be identified on  signage  affixed  to  either  the
   40  interior  or  the  exterior of the premises in any fashion, [(VIII)] (8)
   41  promotions involving alcoholic beverages produced or distributed by  the
   42  manufacturer  or  wholesaler  are not held in such premises and further,
   43  retail and consumer advertising specialties  bearing  the  name  of  the
   44  manufacturer  or  wholesaler or the name of alcoholic beverages produced
   45  or distributed by the manufacturer or wholesaler are not utilized in any
   46  fashion, given away or sold in said premises, and [(IX)] (9)  except  to
   47  the  extent  provided  in this paragraph, the licensing of each premises
   48  covered by this exception  is  subject  to  all  provisions  of  section
   49  sixty-four of this chapter, including but not limited to liquor authori-
   50  ty approval of the specific location thereof.
   51    The provisions of this paragraph shall not prohibit (1) a manufacturer
   52  or  wholesaler, if an individual, or a partner, of a partnership, or, if
   53  a corporation, an officer or director thereof, from being an officer  or
   54  director  of a duly licensed charitable organization which is the holder
   55  of a license for on-premises consumption under this chapter, nor  (2)  a
   56  manufacturer  from  acquiring  any such premises if the liquor authority
       S. 2609--A                         62                         A. 3009--A
    1  first consents thereto after determining, upon such proofs as  it  shall
    2  deem  sufficient, that such premises is contiguous to the licensed prem-
    3  ises of such manufacturer, and is reasonably necessary for the expansion
    4  of  the  facilities of such manufacturer. After any such acquisition, it
    5  shall be illegal for a manufacturer acquiring any such premises to  sell
    6  or deliver alcoholic beverages manufactured by him to any licensee occu-
    7  pying such premises.
    8    S  10.  If  any provision of this act or the application thereof shall
    9  for any reason be finally adjudged by a court of competent  jurisdiction
   10  to  be  invalid  or  unconstitutional,  such  judgment shall not affect,
   11  impair, or invalidate the remainder of this act but shall be confined in
   12  its operation to the provision or provisions directly  involved  in  the
   13  controversy in which such judgment shall have been rendered. It is here-
   14  by declared to be the intent of the legislature that this act would have
   15  been  enacted  even if such invalid provision or provisions had not been
   16  included.  In the event that any provision of the laws of New  York,  as
   17  amended  by  this act, shall be finally adjudged by a court of competent
   18  jurisdiction to be invalid or unconstitutional, the provisions  of  such
   19  laws  in  effect  prior to the date this act shall have become law shall
   20  not be affected by such judgment.
   21    S 11. This act shall take effect immediately; provided, however,  that
   22  the  sales tax exemptions created by sections three and four of this act
   23  shall take effect on the first day of a sales tax quarterly  period,  as
   24  described  in  subdivision  (b)  of  section  1136  of the tax law, next
   25  commencing at least 30 days after this act shall have become a  law  and
   26  shall apply in accordance with the applicable transitional provisions in
   27  sections  1106  and  1217  of the tax law; and provided further that the
   28  amendments to subdivisions 1 and 2 of  section  56-a  of  the  alcoholic
   29  beverage control law made by section eight of this act shall take effect
   30  on the same date and in the same manner as sections 7 and 8, respective-
   31  ly, of chapter 108 of the laws of 2012, as amended, take effect.
   32                                   PART J
   33    Section  1.  The  general  municipal  law  is  amended by adding a new
   34  section 875 to read as follows:
   35    S 875. SPECIAL PROVISIONS APPLICABLE TO STATE SALES  AND  COMPENSATING
   36  USE  TAXES  AND  CERTAIN  TYPES  OF  FACILITIES. 1. FOR PURPOSES OF THIS
   37  SECTION: "STATE SALES AND USE TAXES" MEANS SALES  AND  COMPENSATING  USE
   38  TAXES  AND FEES IMPOSED BY ARTICLE TWENTY-EIGHT OR TWENTY-EIGHT-A OF THE
   39  TAX LAW BUT EXCLUDING SUCH TAXES IMPOSED IN A  CITY  BY  SECTION  ELEVEN
   40  HUNDRED  SEVEN  OR  ELEVEN  HUNDRED  EIGHT OF SUCH ARTICLE TWENTY-EIGHT.
   41  "IDA" MEANS AN INDUSTRIAL DEVELOPMENT AGENCY ESTABLISHED BY THIS ARTICLE
   42  OR AN INDUSTRIAL DEVELOPMENT AUTHORITY CREATED BY THE PUBLIC AUTHORITIES
   43  LAW. "COMMISSIONER" MEANS THE COMMISSIONER OF TAXATION AND FINANCE.
   44    2. (A) AN IDA SHALL NOT PROVIDE STATE  SALES  AND  USE  TAX  EXEMPTION
   45  BENEFITS  WITH RESPECT TO ANY PROJECT UNLESS AND UNTIL THE PREREQUISITES
   46  SET FORTH IN PARAGRAPHS (B), (C), (D) AND (E) OF  THIS  SUBDIVISION  ARE
   47  MET.
   48    (B) EITHER (I) THE AGENT OR PROJECT OPERATOR OF SUCH PROJECT MUST HAVE
   49  BEEN  CERTIFIED  AS A PARTICIPANT IN THE EXCELSIOR JOBS PROGRAM, AS SUCH
   50  TERM "PARTICIPANT" IS DEFINED IN SECTION THREE HUNDRED FIFTY-TWO OF  THE
   51  ECONOMIC DEVELOPMENT LAW, AND PROVIDES TO THE IDA VALID PROOF OF PARTIC-
   52  IPATION  IN  SUCH  PROGRAM, OR (II) IF SUCH AGENT OR PROJECT OPERATOR IS
   53  NOT A PARTICIPANT IN SUCH PROGRAM, THE IDA, AFTER REVIEWING THE FACTS ON
   54  THE RECORD, MUST FIND THAT THE AGENT OR PROJECT OPERATOR IS  A  BUSINESS
       S. 2609--A                         63                         A. 3009--A
    1  ENTITY OF THE TYPE DESCRIBED IN SUBDIVISION ONE OF SECTION THREE HUNDRED
    2  FIFTY-THREE  OF  THE  ECONOMIC  DEVELOPMENT  LAW AND REGULATIONS ADOPTED
    3  PURSUANT TO SUCH SECTION.
    4    (C)  IF  THE  PREREQUISITE IN EITHER SUBPARAGRAPH (I) OR (II) OF PARA-
    5  GRAPH (B) OF THIS SUBDIVISION HAS BEEN MET,  THE  IDA  SHALL  SUBMIT  IN
    6  WRITING ITS PLAN TO PROVIDE SUCH STATE SALES AND USE TAX EXEMPTION BENE-
    7  FITS  FOR  SUCH  PROJECT,  TOGETHER WITH THE FINDINGS IT MADE UNDER SUCH
    8  SUBPARAGRAPH (II) OF PARAGRAPH  (B)  TO  THE  COMMISSIONER  OF  ECONOMIC
    9  DEVELOPMENT.
   10    (D)  THE  COMMISSIONER  OF  ECONOMIC  DEVELOPMENT  SHALL  REVIEW  SUCH
   11  PROPOSED STATE SALES AND USE TAX EXEMPTION BENEFIT PLAN FOR SUCH PROJECT
   12  AND DETERMINE, IN CONSULTATION WITH THE  REGIONAL  ECONOMIC  DEVELOPMENT
   13  COUNCIL  ESTABLISHED  BY  THE GOVERNOR THAT ENCOMPASSES THE JURISDICTION
   14  FOR WHOSE BENEFIT THE IDA RECOMMENDING THE TAX  EXEMPTION  BENEFITS  WAS
   15  CREATED, WHETHER SUCH PROPOSED STATE SALES AND USE TAX EXEMPTION BENEFIT
   16  PLAN  FOR  SUCH PROJECT IS CONSISTENT WITH REGIONAL ECONOMIC DEVELOPMENT
   17  STRATEGIES.
   18    (E) THE COMMISSIONER OF ECONOMIC DEVELOPMENT SHALL  REVIEW  THE  IDA'S
   19  FINDINGS,  IF  ANY,  AND  APPROVE OR DISAPPROVE THE PROPOSED BENEFITS OR
   20  DENY THEM IF SUCH COMMISSIONER DOES NOT APPROVE SUCH IDA'S FINDINGS THAT
   21  THE AGENT/PROJECT OPERATOR IS A BUSINESS ENTITY OF  THE  TYPE  REQUIRED.
   22  SUCH  COMMISSIONER  IS ALSO AUTHORIZED TO MODIFY THE IDA'S PROPOSED PLAN
   23  BY REDUCING THE TOTAL AMOUNT  OF  ANY  SUCH  STATE  SALES  AND  USE  TAX
   24  EXEMPTION  BENEFITS  OR  BY SPECIFYING THAT SUCH BENEFITS SHALL APPLY TO
   25  ONLY SOME OF THE TYPES OF PROPERTY OR SERVICES  PROPOSED  TO  BE  EXEMPT
   26  FROM  SUCH  STATE TAXES OR BY REDUCING THE TIME PERIOD DURING WHICH SUCH
   27  BENEFITS MAY BE PROVIDED. SUCH COMMISSIONER  SHALL  ADVISE  THE  IDA  IN
   28  WRITING  OF HIS OR HER APPROVAL, DISAPPROVAL, DENIAL, OR MODIFICATION OF
   29  THE IDA'S PLAN, AND SUCH APPROVAL, DISAPPROVAL, DENIAL, OR  MODIFICATION
   30  SHALL BIND THE IDA AS TO WHETHER THE IDA CAN PROVIDE STATE SALES AND USE
   31  TAX  EXEMPTION  BENEFITS  AND,  IF APPROVED IN WHOLE OR AS MODIFIED, THE
   32  AMOUNT OF STATE SALES AND USE TAX EXEMPTION BENEFITS THAT  THE  IDA  CAN
   33  PROVIDE WITH RESPECT TO SUCH PROJECT, THE TYPES OF PROPERTY AND SERVICES
   34  THAT  MAY  BE  ELIGIBLE  FOR  EXEMPTION, AND THE DURATION OF TIME DURING
   35  WHICH SUCH EXEMPTION BENEFITS MAY APPLY. HOWEVER, THE  IDA  MAY  PROVIDE
   36  STATE SALES AND USE TAX EXEMPTION BENEFITS IN A LESSER AMOUNT, FOR FEWER
   37  TYPES OF PROPERTY OR SERVICES, OR FOR A SHORTER PERIOD, THAN AS APPROVED
   38  BY SUCH COMMISSIONER.
   39    (F)  NOTWITHSTANDING  THE  FOREGOING, IF AT THE TIME AN IDA PROPOSES A
   40  STATE SALES AND USE TAX EXEMPTION BENEFIT  PLAN  THERE  IS  NO  REGIONAL
   41  ECONOMIC  DEVELOPMENT COUNCIL IN THE APPLICABLE REGION, THEN THE COMMIS-
   42  SIONER OF ECONOMIC DEVELOPMENT SHALL REVIEW SUCH PLAN AND ANY SUCH FIND-
   43  INGS AS PROVIDED IN PARAGRAPH (D) OF THIS SUBDIVISION, WITHOUT REGARD TO
   44  THE RECOMMENDATION OF ANY OTHER BODY.
   45    (G) AN IDA SHALL NOT PROVIDE STATE SALES AND USE TAX  EXEMPTION  BENE-
   46  FITS IN AN AMOUNT GREATER, FOR PROPERTY OR SERVICES OTHER, OR FOR A TIME
   47  PERIOD  LONGER THAN AS APPROVED BY THE COMMISSIONER OF ECONOMIC DEVELOP-
   48  MENT. ANY AMOUNT OF STATE SALES AND USE TAX EXEMPTION BENEFITS  THAT  AN
   49  IDA PURPORTS TO PROVIDE IN EXCESS OF THE AMOUNT APPROVED, OR FOR DIFFER-
   50  ENT  PROPERTY  OR  SERVICES  THAN  APPROVED, OR FOR A PERIOD LONGER THAN
   51  APPROVED BY SUCH COMMISSIONER SHALL BE VOID FROM ITS INCEPTION,  AND  AN
   52  AGENT, PROJECT OPERATOR, OR OTHER PERSON OR ENTITY THAT MAKES A PURCHASE
   53  OR  USE WITHOUT PAYING STATE SALES AND USE TAXES, OR WHO PAID SUCH TAXES
   54  BUT OBTAINED A REFUND OR CREDIT OF THEM, AS A RESULT SHALL  BE  REQUIRED
   55  TO PAY SUCH AMOUNT OF TAX TO THE COMMISSIONER OF TAXATION AND FINANCE IN
   56  ACCORDANCE  WITH  ARTICLES  TWENTY-EIGHT AND TWENTY-NINE OF THE TAX LAW.
       S. 2609--A                         64                         A. 3009--A
    1  THE COMMISSIONER SHALL BE AUTHORIZED TO DETERMINE AND ASSESS STATE SALES
    2  AND USE TAXES FOREGONE ON ACCOUNT OF AN AGENT, PROJECT OPERATOR OR OTHER
    3  PERSON OR ENTITY NOT HAVING PAID SUCH STATE SALES OR USE TAX THAT SHOULD
    4  HAVE  BEEN  PAID, OR WHO OBTAINED SUCH A REFUND OR CREDIT BUT SHOULD NOT
    5  HAVE, IN ACCORD WITH THE APPLICABLE PROVISIONS OF THE  TAX  LAW,  EXCEPT
    6  THAT  ANY  STATUTE  THAT  LIMITS THE TIME BY WHICH THE COMMISSIONER MUST
    7  DETERMINE OR ASSESS SUCH TAX SHALL NOT BEGIN TO RUN  UNTIL  THE  COMMIS-
    8  SIONER HAS RECEIVED ACTUAL NOTICE OF SUCH IMPROPER PURCHASES OR USES.
    9    3.  AN  IDA  SHALL KEEP RECORDS OF THE AMOUNT OF STATE AND LOCAL SALES
   10  AND USE TAX EXEMPTION BENEFITS PROVIDED TO EACH PROJECT AND  EACH  AGENT
   11  OR  PROJECT  OPERATOR,  AND  SHALL  MAKE  SUCH  RECORDS AVAILABLE TO THE
   12  COMMISSIONER AND STATE COMPTROLLER UPON REQUEST. SUCH  IDA  SHALL  ALSO,
   13  WITHIN  THIRTY  DAYS OF PROVIDING FINANCIAL ASSISTANCE TO A PROJECT THAT
   14  INCLUDES ANY AMOUNT OF STATE  SALES  AND  USE  TAX  EXEMPTION  BENEFITS,
   15  REPORT  TO THE COMMISSIONER AND THE STATE COMPTROLLER THE AMOUNT OF SUCH
   16  BENEFITS FOR SUCH PROJECT, THE PROJECT TO WHICH THEY ARE BEING PROVIDED,
   17  ANY LIMITATION ON THE APPLICATION OR EXERCISE OF  SUCH  EXEMPTIONS,  THE
   18  TYPES  OF  PROPERTY  AND  SERVICES TO BE EXEMPTED, THE TIME DURING WHICH
   19  SUCH EXEMPTION BENEFITS APPLY, AND THE NAME AND ADDRESS OF THE AGENT  OR
   20  PROJECT  OPERATOR  OF SUCH PROJECT, TOGETHER WITH SUCH OTHER INFORMATION
   21  AND SUCH SPECIFICITY AND DETAIL AS THE COMMISSIONER MAY PRESCRIBE,  WITH
   22  A COPY OF SUCH REPORT FURNISHED AT THE SAME TIME TO THE AGENT OR PROJECT
   23  OPERATOR.  THIS  REPORT  MAY  BE  MADE IN CONJUNCTION WITH THE STATEMENT
   24  REQUIRED BY SUBDIVISION NINE OF SECTION EIGHT  HUNDRED  SEVENTY-FOUR  OF
   25  THIS  ARTICLE  OR IT MAY BE MADE AS A SEPARATE REPORT, AT THE DISCRETION
   26  OF THE COMMISSIONER. AN AGENT OR PROJECT OPERATOR  OR  OTHER  PERSON  OR
   27  ENTITY  SHALL  NOT  AVAIL  ITSELF  OF  STATE  OR LOCAL SALES AND USE TAX
   28  EXEMPTIONS IN EXCESS OF THE AMOUNT OR IN CONTRAVENTION OF THE  TIME  AND
   29  OTHER  LIMITATIONS  SET  OUT  IN SUCH REPORT OR FOR PROPERTY OR SERVICES
   30  OTHER THAN THOSE SET OUT IN SUCH REPORT. AN IDA THAT FAILS TO MAKE  SUCH
   31  RECORDS  AVAILABLE TO THE COMMISSIONER OR TO THE STATE COMPTROLLER OR TO
   32  FILE SUCH REPORT OR TO COMPLY WITH ANY OTHER REQUIREMENT OF THIS  SUBDI-
   33  VISION  SHALL  BE  PROHIBITED  FROM  PROVIDING  STATE  SALES AND USE TAX
   34  EXEMPTION BENEFITS FOR ANY PROJECT UNLESS AND UNTIL SUCH IDA COMES  INTO
   35  COMPLIANCE WITH ALL SUCH REQUIREMENTS.
   36    4.  NOTWITHSTANDING  ANY PROVISION OF THIS SECTION OR OTHER LAW, IN NO
   37  CASE SHALL AN IDA AGENT, PROJECT OPERATOR, OR  OTHER  PERSON  OR  ENTITY
   38  TAKE ANY STATE SALES AND USE TAX EXEMPTION BENEFITS AS EXEMPTIONS AT THE
   39  TIME  OF  PURCHASE  OR  USE.  RATHER, IN ALL CASES, THE PERSON OR ENTITY
   40  SHALL PAY STATE SALES OR USE TAX TO THE PERSON REQUIRED TO COLLECT IT AT
   41  THE TIME OF PURCHASE OR TO THE COMMISSIONER IN ACCORD WITH THE  REQUIRE-
   42  MENTS  OF  ARTICLE TWENTY-EIGHT OF THE TAX LAW. AFTER HAVING PAID TAX TO
   43  THE PERSON REQUIRED TO COLLECT IT OR TO THE COMMISSIONER, SUCH PERSON OR
   44  ENTITY MAY THEN APPLY TO THE COMMISSIONER FOR A REFUND OR CREDIT OF SUCH
   45  TAX ACTUALLY PAID. ANY SUCH REFUND OR CREDIT SHALL THEN BE  APPLIED  FOR
   46  IN THE MANNER ESTABLISHED BY AND SUBJECT TO THE PROVISIONS OF SUCH ARTI-
   47  CLE TWENTY-EIGHT.
   48    5.  NOTWITHSTANDING ANY PROVISION OF THIS SECTION OR OTHER LAW, AN IDA
   49  SHALL NOT CREATE A PROJECT OR ANY PORTION OF A PROJECT, OR AUTHORIZE THE
   50  USE OF ANY PROJECT OR PROJECT PROPERTY, OUTSIDE THIS STATE.
   51    6. AN IDA THAT ENTERS INTO AN AGREEMENT REQUIRING PAYMENTS IN LIEU  OF
   52  STATE  SALES  AND USE TAXES TO BE PAID TO IT SHALL REMIT THE FULL AMOUNT
   53  OF ANY SUCH PAYMENTS IT RECEIVES TO THE COMMISSIONER WITHIN THIRTY  DAYS
   54  OF THE DATE THAT THE IDA RECEIVES THE PAYMENT, TOGETHER WITH A RETURN OR
   55  REPORT  REQUIRED  BY  THE COMMISSIONER. THE IDA SHALL SEND A COPY OF ANY
   56  SUCH AGREEMENT FOR PAYMENT IN LIEU OF SUCH  TAXES  TO  THE  COMMISSIONER
       S. 2609--A                         65                         A. 3009--A
    1  WITHIN  THIRTY  DAYS OF THE DATE IT IS EXECUTED. IF THE PERSON OR ENTITY
    2  REQUIRED TO MAKE SUCH PAYMENTS TO THE IDA FAILS TO DO SO TIMELY,  OR  IF
    3  THE  IDA  FAILS  TO  REMIT SUCH PAYMENTS TO THE COMMISSIONER TIMELY, THE
    4  AMOUNT  OF  ANY  SUCH  UNTIMELY  PAYMENTS OR REMISSIONS, TOGETHER WITH A
    5  PENALTY OF FIVE PERCENT OF THE AMOUNT OF SUCH LATE PAYMENTS AND INTEREST
    6  ON SUCH LATE PAYMENTS AT THE RATE OF ONE PERCENT  PER MONTH,  SHALL  ALL
    7  BE DEEMED TO BE SALES TAX WHICH A RETURN OR REPORT SHOWS TO BE DUE UNDER
    8  SECTION  ONE  HUNDRED  SEVENTY-THREE-A  OF  THE TAX LAW AND SUCH AMOUNTS
    9  SHALL BE PAID UPON NOTICE AND DEMAND AND SHALL BE  ASSESSED,  COLLECTED,
   10  AND  PAID  IN  THE  MANNER  PROVIDED  FOR SALES TAX, AND SUCH NOTICE AND
   11  DEMAND SHALL  NOT  BE  CONSIDERED  AS  A  NOTICE  OF  DETERMINATION,  AS
   12  DESCRIBED IN SUCH SECTION ONE HUNDRED SEVENTY-THREE-A. AN IDA SHALL JOIN
   13  THE  COMMISSIONER  AS  A  PARTY IN ANY ACTION OR PROCEEDING THAT THE IDA
   14  COMMENCES TO RECOVER, OBTAIN, OR OTHERWISE SEEK, ANY UNPAID PAYMENTS  IN
   15  LIEU OF STATE SALES AND USE TAX FROM AN AGENT, PROJECT OPERATOR OR OTHER
   16  PERSON OR ENTITY. THE PROVISIONS OF THIS SUBDIVISION SHALL ALSO APPLY TO
   17  ANY  INTEREST  OR  PENALTY  THAT THE IDA IMPOSES ON ANY SUCH PAYMENTS IN
   18  LIEU OF TAXES OR THAT ARE IMPOSED ON SUCH PAYMENTS BY OPERATION  OF  LAW
   19  OR  BY JUDICIAL ORDER OR OTHERWISE. ANY SUCH PAYMENTS, TOGETHER WITH ANY
   20  INTEREST OR PENALTIES THEREON, SHALL BE DEEMED TO BE STATE SALES AND USE
   21  TAXES AND THE IDA SHALL RECEIVE ANY SUCH PAYMENTS, WHETHER AS  A  RESULT
   22  OF  COURT  ACTION  OR  OTHERWISE,  AS  TRUSTEE FOR AND ON ACCOUNT OF THE
   23  STATE.
   24    7. AN IDA OR IDA AGENT OR PROJECT OPERATOR SHALL NOT  BE  EXEMPT  FROM
   25  THE  TAXES IMPOSED BY PARAGRAPH TEN OF SUBDIVISION (C) OF SECTION ELEVEN
   26  HUNDRED FIVE OR BY ARTICLE TWENTY-EIGHT-A OR TWENTY-NINE-A  OF  THE  TAX
   27  LAW.
   28    8. IF AN IDA RECOVERS, RECAPTURES, RECEIVES, OR OTHERWISE OBTAINS, ANY
   29  AMOUNT  OF  STATE  SALES  AND  USE TAX EXEMPTION BENEFITS FROM AN AGENT,
   30  PROJECT OPERATOR OR OTHER PERSON OR ENTITY, THE IDA SHALL, WITHIN THIRTY
   31  DAYS OF COMING INTO POSSESSION OF SUCH AMOUNT, REMIT IT TO  THE  COMMIS-
   32  SIONER,  TOGETHER WITH SUCH INFORMATION AND REPORT THAT THE COMMISSIONER
   33  DEEMS NECESSARY TO ADMINISTER PAYMENT OVER OF SUCH AMOUNT. AN IDA  SHALL
   34  JOIN  THE  COMMISSIONER  AS A PARTY IN ANY ACTION OR PROCEEDING THAT THE
   35  IDA COMMENCES TO RECOVER,  RECAPTURE,  OBTAIN,  OR  OTHERWISE  SEEK  THE
   36  RETURN  OF,  STATE  SALES  AND USE TAX EXEMPTION BENEFITS FROM AN AGENT,
   37  PROJECT OPERATOR OR OTHER PERSON OR  ENTITY.    THIS  SUBDIVISION  SHALL
   38  APPLY  TO ANY AMOUNTS OF STATE SALES AND USE TAX EXEMPTION BENEFITS THAT
   39  AN IDA RECOVERS, RECAPTURES, RECEIVES, OR OTHERWISE OBTAINS,  REGARDLESS
   40  OF  WHETHER  THE  IDA  OR THE AGENT, PROJECT OPERATOR OR OTHER PERSON OR
   41  ENTITY CHARACTERIZES SUCH BENEFITS RECOVERED, RECAPTURED,  RECEIVED,  OR
   42  OTHERWISE  OBTAINED,  AS  A PENALTY OR LIQUIDATED OR CONTRACT DAMAGES OR
   43  OTHERWISE. THE PROVISIONS OF THIS SUBDIVISION SHALL ALSO  APPLY  TO  ANY
   44  INTEREST OR PENALTY THAT THE IDA IMPOSES ON ANY SUCH AMOUNTS OR THAT ARE
   45  IMPOSED  ON  SUCH  AMOUNTS  BY  OPERATION OF LAW OR BY JUDICIAL ORDER OR
   46  OTHERWISE. ANY SUCH AMOUNTS OR PAYMENTS THAT  AN  IDA  RECOVERS,  RECAP-
   47  TURES,  RECEIVES,  OR  OTHERWISE  OBTAINS, TOGETHER WITH ANY INTEREST OR
   48  PENALTIES THEREON, SHALL BE DEEMED TO BE STATE SALES AND USE  TAXES  AND
   49  THE  IDA SHALL RECEIVE ANY SUCH AMOUNTS OR PAYMENTS, WHETHER AS A RESULT
   50  OF COURT ACTION OR OTHERWISE, AS TRUSTEE  FOR  AND  ON  ACCOUNT  OF  THE
   51  STATE.
   52    9.  THE  COMMISSIONER  SHALL  DEPOSIT AND DISPOSE OF ANY AMOUNT OF ANY
   53  PAYMENTS OR MONEYS RECEIVED FROM OR PAID OVER BY AN IDA OR  FROM  OR  BY
   54  ANY  PERSON  OR  ENTITY, OR RECEIVED PURSUANT TO AN ACTION OR PROCEEDING
   55  COMMENCED BY AN IDA, TOGETHER WITH ANY INTEREST  OR  PENALTIES  THEREON,
   56  PURSUANT TO SUBDIVISION SIX OR EIGHT OF THIS SECTION, AS STATE SALES AND
       S. 2609--A                         66                         A. 3009--A
    1  USE  TAXES  IN ACCORD WITH THE PROVISIONS OF ARTICLE TWENTY-EIGHT OF THE
    2  TAX LAW.  THE AMOUNT OF ANY SUCH PAYMENTS OR MONEYS, TOGETHER  WITH  ANY
    3  INTEREST  OR PENALTIES THEREON, SHALL BE ATTRIBUTED TO THE TAXES IMPOSED
    4  BY SECTIONS ELEVEN HUNDRED FIVE AND ELEVEN HUNDRED TEN, ON THE ONE HAND,
    5  AND SECTION ELEVEN HUNDRED NINE OF THE TAX LAW, ON THE OTHER HAND, OR TO
    6  ANY  LIKE TAXES OR FEES IMPOSED BY SUCH ARTICLE, BASED ON THE PROPORTION
    7  THAT THE RATES OF SUCH TAXES OR FEES BEAR TO EACH OTHER, UNLESS THERE IS
    8  EVIDENCE TO SHOW THAT ONLY ONE OR THE OTHER OF SUCH TAXES  OR  FEES  WAS
    9  IMPOSED OR RECEIVED OR PAID OVER.
   10    10.  THE  STATEMENT  THAT  AN  IDA  IS REQUIRED BY SUBDIVISION NINE OF
   11  SECTION EIGHT HUNDRED SEVENTY-FOUR OF THIS  ARTICLE  TO  FILE  WITH  THE
   12  COMMISSIONER  SHALL  NOT BE CONSIDERED AN EXEMPTION OR OTHER CERTIFICATE
   13  OR DOCUMENT UNDER ARTICLE TWENTY-EIGHT OR TWENTY-NINE OF  THE  TAX  LAW.
   14  THE  IDA  SHALL  NOT  REPRESENT TO ANY AGENT, PROJECT OPERATOR, OR OTHER
   15  PERSON OR ENTITY THAT A COPY OF SUCH STATEMENT MAY SERVE AS A  SALES  OR
   16  USE  TAX EXEMPTION CERTIFICATE OR DOCUMENT. NO AGENT OR PROJECT OPERATOR
   17  MAY TENDER A COPY OF SUCH STATEMENT TO ANY PERSON  REQUIRED  TO  COLLECT
   18  SALES OR USE TAXES AS THE BASIS TO MAKE ANY PURCHASE EXEMPT FROM TAX. NO
   19  SUCH  PERSON  REQUIRED  TO  COLLECT SALES OR USE TAXES MAY ACCEPT SUCH A
   20  STATEMENT IN LIEU OF COLLECTING ANY TAX REQUIRED TO  BE  COLLECTED.  THE
   21  CIVIL  AND  CRIMINAL PENALTIES FOR MISUSE OF A COPY OF SUCH STATEMENT AS
   22  AN EXEMPTION CERTIFICATE OR DOCUMENT OR FOR FAILURE TO  PAY  OR  COLLECT
   23  TAX  SHALL BE AS PROVIDED IN THE TAX LAW. IN ADDITION, THE USE BY AN IDA
   24  OR AGENT, PROJECT OPERATOR, OR OTHER PERSON OR ENTITY OF SUCH STATEMENT,
   25  OR THE IDA'S RECOMMENDATION OF THE USE OR TENDERING OF  SUCH  STATEMENT,
   26  AS  SUCH  AN  EXEMPTION  CERTIFICATE  OR DOCUMENT SHALL BE DEEMED TO BE,
   27  UNDER ARTICLES TWENTY-EIGHT AND THIRTY-SEVEN OF THE TAX LAW,  THE  ISSU-
   28  ANCE  OF  A  FALSE  OR FRAUDULENT EXEMPTION CERTIFICATE OR DOCUMENT WITH
   29  INTENT TO EVADE TAX.
   30    11. IN CONSULTATION WITH THE COMMISSIONER OF ECONOMIC DEVELOPMENT, THE
   31  COMMISSIONER OF TAXATION AND FINANCE IS HEREBY AUTHORIZED TO ADOPT RULES
   32  AND REGULATIONS AND TO ISSUE PUBLICATIONS AND OTHER GUIDANCE  IMPLEMENT-
   33  ING  THE  PROVISIONS  OF  THIS SECTION AND OF THE OTHER SECTIONS OF THIS
   34  ARTICLE RELATING TO ANY STATE OR LOCAL  TAX  OR  FEE,  OR  EXEMPTION  OR
   35  EXCLUSION  THEREFROM,  THAT THE COMMISSIONER ADMINISTERS AND THAT MAY BE
   36  AFFECTED BY ANY PROVISION OF THIS ARTICLE, AND ANY SUCH RULES AND  REGU-
   37  LATIONS  OF  THE  COMMISSIONER SHALL HAVE THE SAME FORCE AND EFFECT WITH
   38  RESPECT TO SUCH TAXES AND FEES, OR AMOUNTS MEASURED IN RESPECT OF  THEM,
   39  AS IF THEY HAD BEEN ADOPTED BY THE COMMISSIONER PURSUANT TO THE AUTHORI-
   40  TY OF THE TAX LAW.
   41    12.  TO  THE  EXTENT THAT A PROVISION OF THIS SECTION CONFLICTS WITH A
   42  PROVISION OF ANY OTHER SECTION OF THIS ARTICLE, THE PROVISIONS  OF  THIS
   43  SECTION SHALL CONTROL.
   44    S  2.  The  public  authorities law is amended by adding a new section
   45  1963-b to read as follows:
   46    S 1963-B. SPECIAL PROVISIONS APPLICABLE TO STATE SALES AND  COMPENSAT-
   47  ING USE TAXES AND CERTAIN TYPES OF FACILITIES. THE PROVISIONS OF SECTION
   48  EIGHT  HUNDRED  SEVENTY-FIVE OF THE GENERAL MUNICIPAL LAW SHALL APPLY TO
   49  THE PROVISIONS OF THIS TITLE AND TO THE AUTHORITY CREATED BY THIS  TITLE
   50  WITH  THE  SAME  FORCE  AND  EFFECT AS IF THE PROVISIONS OF SUCH SECTION
   51  EIGHT HUNDRED SEVENTY-FIVE HAD BEEN INCORPORATED IN FULL INTO THIS TITLE
   52  AND HAD EXPRESSLY REFERRED TO THE PROVISIONS OF THIS TITLE AND  TO  SUCH
   53  AUTHORITY,  WITH  SUCH CHANGES TO SUCH SECTION AS ARE NECESSARY TO REFER
   54  TO THE PROVISIONS OF THIS TITLE AND TO THE  AUTHORITY  CREATED  BY  THIS
   55  TITLE.
       S. 2609--A                         67                         A. 3009--A
    1    S  3.  The  public  authorities law is amended by adding a new section
    2  2326-a to read as follows:
    3    S  2326-A. SPECIAL PROVISIONS APPLICABLE TO STATE SALES AND COMPENSAT-
    4  ING USE TAXES AND CERTAIN TYPES OF FACILITIES. THE PROVISIONS OF SECTION
    5  EIGHT HUNDRED SEVENTY-FIVE OF THE GENERAL MUNICIPAL LAW SHALL  APPLY  TO
    6  THE  PROVISIONS OF THIS TITLE AND TO THE AUTHORITY CREATED BY THIS TITLE
    7  WITH THE SAME FORCE AND EFFECT AS IF  THE  PROVISIONS  OF  SUCH  SECTION
    8  EIGHT HUNDRED SEVENTY-FIVE HAD BEEN INCORPORATED IN FULL INTO THIS TITLE
    9  AND  HAD  EXPRESSLY REFERRED TO THE PROVISIONS OF THIS TITLE AND TO SUCH
   10  AUTHORITY, WITH SUCH CHANGES TO SUCH SECTION AS ARE NECESSARY  TO  REFER
   11  TO  THE  PROVISIONS  OF  THIS TITLE AND TO THE AUTHORITY CREATED BY THIS
   12  TITLE.
   13    S 4. Subdivision 3 of section 810 of the  general  municipal  law,  as
   14  amended  by  chapter  356  of  the  laws  of 1993, is amended to read as
   15  follows:
   16    3. The term "local officer or employee" shall mean  the  heads  (other
   17  than local elected officials) of any agency, department, division, coun-
   18  cil,  board,  commission, or bureau of a political subdivision and their
   19  deputies and assistants, and the officers and employees  of  such  agen-
   20  cies,  departments,  divisions, boards, bureaus, commissions or councils
   21  who hold policy-making positions, as annually determined by the appoint-
   22  ing authority and set forth in a written instrument which shall be filed
   23  with the appropriate body during the month of February; except that  the
   24  term  "local officer or employee" shall not mean a judge, justice, offi-
   25  cer or employee of the unified  court  system.  Members,  officers,  and
   26  employees  of  each  industrial  development agency and authority ESTAB-
   27  LISHED BY THIS CHAPTER OR CREATED BY THE PUBLIC AUTHORITIES LAW shall be
   28  deemed officers or employees of the county, city, village, or  town  for
   29  whose benefit such agency or authority is established OR CREATED.
   30    S  5.  Subdivision  4  of section 854 of the general municipal law, as
   31  amended by chapter 478 of the laws  of  2011,  is  amended  to  read  as
   32  follows:
   33    (4)  "Project"  -  shall mean any land, any building or other improve-
   34  ment, and all real and personal properties located within the  state  of
   35  New York and within or outside or partially within and partially outside
   36  the  municipality  for  whose benefit the agency was created, including,
   37  but not limited to, machinery, equipment  and  other  facilities  deemed
   38  necessary  or  desirable in connection therewith, or incidental thereto,
   39  whether or not now in existence or under construction,  which  shall  be
   40  suitable  for manufacturing, warehousing, research, commercial or indus-
   41  trial purposes or  other  economically  sound  purposes  identified  and
   42  called  for  to implement a state designated urban cultural park manage-
   43  ment plan as provided in title G of the parks, recreation  and  historic
   44  preservation  law  and which may include or mean an industrial pollution
   45  control facility, a recreation facility, educational or cultural facili-
   46  ty, a horse racing facility, a railroad facility or an automobile racing
   47  facility, provided, however, no agency shall use its  funds  OR  PROVIDE
   48  FINANCIAL  ASSISTANCE  in  respect  of  any  project wholly or partially
   49  outside the municipality for whose benefit the agency was created  with-
   50  out the prior consent thereto by the governing body or bodies of all the
   51  other  municipalities  in which a part or parts of the project is, or is
   52  to be, located, AND SUCH PORTION OF THE  PROJECT  LOCATED  OUTSIDE  SUCH
   53  MUNICIPALITY  FOR  WHOSE BENEFIT THE AGENCY WAS CREATED SHALL BE CONTIG-
   54  UOUS WITH THE PORTION OF THE PROJECT INSIDE SUCH MUNICIPALITY.
   55    S 6. Section 883 of the general municipal law, as added by chapter 356
   56  of the laws of 1993, is amended to read as follows:
       S. 2609--A                         68                         A. 3009--A
    1    S 883. Conflicts of interest. All members, officers, and employees  of
    2  an  agency or INDUSTRIAL DEVELOPMENT authority ESTABLISHED BY THIS CHAP-
    3  TER OR CREATED BY THE PUBLIC AUTHORITIES LAW shall  be  subject  to  the
    4  provisions of article eighteen of this chapter.
    5    S  7.  Subdivision  9  of section 874 of the general municipal law, as
    6  added by section 1 of subpart C of part S of chapter 57 of the  laws  of
    7  2010, is amended to read as follows:
    8    (9)  (A)  Within  thirty days of the date that the agency designates a
    9  project operator or other person to act  as  agent  of  the  agency  for
   10  purposes  of  providing financial assistance consisting of any sales and
   11  compensating use tax exemption to such person, the agency shall  file  a
   12  statement  with the department of taxation and finance relating thereto,
   13  on a form and in such manner as is prescribed  by  the  commissioner  of
   14  taxation  and finance, identifying each such agent so named by the agen-
   15  cy, setting forth the taxpayer identification number of each such agent,
   16  giving a brief description of the property and/or services  intended  to
   17  be  exempted  from  such taxes as a result of such appointment as agent,
   18  indicating the agency's rough estimate of  the  value  of  the  property
   19  and/or  services  to which such appointment as agent relates, indicating
   20  the date when such designation as agent became effective and  indicating
   21  the date upon which such designation as agent shall cease.
   22    (B)  WITHIN  THIRTY  DAYS  OF  THE  DATE THAT THE AGENCY'S DESIGNATION
   23  DESCRIBED IN PARAGRAPH (A) OF THIS SUBDIVISION HAS BEEN AMENDED,  TERMI-
   24  NATED,  BEEN  REVOKED,  OR BECOME INVALID OR INEFFECTIVE FOR ANY REASON,
   25  THE AGENCY SHALL FILE A STATEMENT WITH THE DEPARTMENT  OF  TAXATION  AND
   26  FINANCE  RELATING THERETO, ON A FORM AND IN SUCH MANNER AS IS PRESCRIBED
   27  BY THE COMMISSIONER OF TAXATION AND FINANCE, IDENTIFYING EACH SUCH AGENT
   28  SO NAMED BY THE AGENCY IN THE ORIGINAL DESIGNATION AND SETTING FORTH THE
   29  TAXPAYER IDENTIFICATION NUMBER AND OTHER IDENTIFYING INFORMATION OF EACH
   30  SUCH AGENT, THE DATE AS OF WHICH THE ORIGINAL DESIGNATION  WAS  AMENDED,
   31  TERMINATED,  REVOKED,  OR  BECAME  INVALID OR INEFFECTIVE AND THE REASON
   32  THEREFOR, TOGETHER WITH A COPY OF THE ORIGINAL DESIGNATION.
   33    S 8. Subdivision 4 of section 1963 of the public authorities  law,  as
   34  added  by  section 2 of subpart C of part S of chapter 57 of the laws of
   35  2010, is amended to read as follows;
   36    4. (A) Within thirty days of the date that the authority designates  a
   37  project  operator  or  other person to act as agent of the authority for
   38  purposes of providing financial assistance consisting of any  sales  and
   39  compensating  use  tax exemption to such person, the agency shall file a
   40  statement with the department of taxation and finance relating  thereto,
   41  on  a  form  and  in such manner as is prescribed by the commissioner of
   42  taxation and finance, identifying  each  such  agent  so  named  by  the
   43  authority, setting forth the taxpayer identification number of each such
   44  agent,  giving  a  brief  description  of  the  property and/or services
   45  intended to be exempted from such taxes as a result of such  appointment
   46  as  agent, indicating the authority's rough estimate of the value of the
   47  property and/or services to which such  appointment  as  agent  relates,
   48  indicating  the date when such designation as agent became effective and
   49  indicating the date upon which such designation as agent shall cease.
   50    (B) WITHIN THIRTY DAYS OF THE DATE THAT  THE  AUTHORITY'S  DESIGNATION
   51  DESCRIBED  IN PARAGRAPH (A) OF THIS SUBDIVISION HAS BEEN AMENDED, TERMI-
   52  NATED, BEEN REVOKED, OR BECOME INVALID OR INEFFECTIVE  FOR  ANY  REASON,
   53  THE AUTHORITY SHALL FILE A STATEMENT WITH THE DEPARTMENT OF TAXATION AND
   54  FINANCE  RELATING THERETO, ON A FORM AND IN SUCH MANNER AS IS PRESCRIBED
   55  BY THE COMMISSIONER OF TAXATION AND FINANCE, IDENTIFYING EACH SUCH AGENT
   56  SO NAMED BY THE AUTHORITY IN THE ORIGINAL DESIGNATION AND SETTING  FORTH
       S. 2609--A                         69                         A. 3009--A
    1  THE  TAXPAYER IDENTIFICATION NUMBER AND OTHER IDENTIFYING INFORMATION OF
    2  EACH SUCH AGENT, THE DATE AS  OF  WHICH  THE  ORIGINAL  DESIGNATION  WAS
    3  AMENDED,  TERMINATED,  REVOKED, OR BECAME INVALID OR INEFFECTIVE AND THE
    4  REASON THEREFOR, TOGETHER WITH A COPY OF THE ORIGINAL DESIGNATION.
    5    S  9.  Subdivision 4 of section 2326 of the public authorities law, as
    6  added by section 3 of subpart C of part S of chapter 57 of the  laws  of
    7  2010, is amended to read as follows:
    8    4.  (A) Within thirty days of the date that the authority designates a
    9  project operator or other person to act as agent of  the  authority  for
   10  purposes  of  providing financial assistance consisting of any sales and
   11  compensating use tax exemption to such person, the agency shall  file  a
   12  statement  with the department of taxation and finance relating thereto,
   13  on a form and in such manner as is prescribed  by  the  commissioner  of
   14  taxation  and  finance,  identifying  each  such  agent  so named by the
   15  authority, setting forth the taxpayer identification number of each such
   16  agent, giving a  brief  description  of  the  property  and/or  services
   17  intended  to be exempted from such taxes as a result of such appointment
   18  as agent, indicating the authority's rough estimate of the value of  the
   19  property  and/or  services  to  which such appointment as agent relates,
   20  indicating the date when such designation as agent became effective  and
   21  indicating the date upon which such designation as agent shall cease.
   22    (B)  WITHIN  THIRTY  DAYS OF THE DATE THAT THE AUTHORITY'S DESIGNATION
   23  DESCRIBED IN PARAGRAPH (A) OF THIS SUBDIVISION HAS BEEN AMENDED,  TERMI-
   24  NATED,  BEEN  REVOKED,  OR BECOME INVALID OR INEFFECTIVE FOR ANY REASON,
   25  THE AUTHORITY SHALL FILE A STATEMENT WITH THE DEPARTMENT OF TAXATION AND
   26  FINANCE RELATING THERETO, ON A FORM AND IN SUCH MANNER AS IS  PRESCRIBED
   27  BY THE COMMISSIONER OF TAXATION AND FINANCE, IDENTIFYING EACH SUCH AGENT
   28  SO  NAMED BY THE AUTHORITY IN THE ORIGINAL DESIGNATION AND SETTING FORTH
   29  THE TAXPAYER IDENTIFICATION NUMBER AND OTHER IDENTIFYING INFORMATION  OF
   30  EACH  SUCH  AGENT,  THE  DATE  AS  OF WHICH THE ORIGINAL DESIGNATION WAS
   31  AMENDED, TERMINATED, REVOKED, OR BECAME INVALID OR INEFFECTIVE  AND  THE
   32  REASON THEREFOR, TOGETHER WITH A COPY OF THE ORIGINAL DESIGNATION.
   33    S  10. Severability. If any provision of this act shall for any reason
   34  be finally adjudged by any court of competent jurisdiction to be  inval-
   35  id,  such judgment shall not affect, impair, or invalidate the remainder
   36  of this act, but shall be confined in its  operation  to  the  provision
   37  directly  involved  in the controversy in which such judgment shall have
   38  been rendered. It is hereby declared to be the intent of the legislature
   39  that this act would have been enacted even if such invalid provision had
   40  not been included in this act.
   41    S 11. This act shall take effect immediately and shall  apply  to  (a)
   42  any  project established, agent or project operator appointed, financial
   43  assistance provided, and agreement regarding payments in lieu  of  taxes
   44  entered into, on or after the date this act shall have become a law, (b)
   45  any  amendment or revision made on or after the date this act shall have
   46  become a law to any  project  established,  agent  or  project  operator
   47  appointed,  financial  assistance  provided, or payment in lieu of taxes
   48  entered into, prior to that date, (c) any state sales  and  compensating
   49  use tax exemption benefits recovered, recaptured, received, or otherwise
   50  obtained by an industrial development agency or authority established by
   51  the general municipal law or created by the public authorities law on or
   52  after such date, and (d) any payments in lieu of state sales and compen-
   53  sating  use  taxes of such an industrial development agency or authority
   54  receives on or after such date.
   55                                   PART K
       S. 2609--A                         70                         A. 3009--A
    1    Section 1. Paragraph 42 of subdivision (a) of section 1115 of the  tax
    2  law,  as  added  by section 11 of part W-1 of chapter 109 of the laws of
    3  2006, is amended to read as follows:
    4    (42)  E85, CNG or hydrogen, for use or consumption directly and exclu-
    5  sively in the engine of a motor vehicle AND NATURAL  GAS  PURCHASED  AND
    6  CONVERTED  INTO CNG, FOR USE OR FOR SALE FOR USE OR CONSUMPTION DIRECTLY
    7  AND EXCLUSIVELY IN THE ENGINE OF A MOTOR VEHICLE.
    8    S 2. This act shall take effect on the first day of a sales tax  quar-
    9  terly period, as described in subdivision (b) of section 1136 of the tax
   10  law,  next  commencing  after this act shall have become a law and shall
   11  apply in accordance  with  the  applicable  transitional  provisions  in
   12  sections  1106  and  1217  of  the  tax law; provided, however, that the
   13  amendments to paragraph 42 of subdivision (a) of section 1115 of the tax
   14  law made by section one of this act shall not affect the repeal of  such
   15  paragraph and shall be deemed repealed therewith.
   16                                   PART L
   17    Section  1.  Section  301-c  of the tax law is amended by adding a new
   18  subdivision (p) to read as follows:
   19    (P) REIMBURSEMENT FOR MOTOR FUEL AND  DIESEL  MOTOR  FUEL  USED  BY  A
   20  VOLUNTARY AMBULANCE SERVICE, AS DEFINED IN SECTION THREE THOUSAND ONE OF
   21  THE  PUBLIC  HEALTH LAW, A FIRE COMPANY OR A FIRE DEPARTMENT, AS DEFINED
   22  IN SECTION THREE OF THE VOLUNTEER FIREFIGHTERS' BENEFIT LAW, OR A VOLUN-
   23  TEER RESCUE SQUAD SUPPORTED IN WHOLE OR IN PART BY TAX MONIES, WHERE ANY
   24  SUCH ENTITY IS THE PURCHASER, USER OR CONSUMER OF MOTOR FUEL  OR  DIESEL
   25  MOTOR  FUEL  IN  A  VEHICLE  OWNED  AND OPERATED BY SUCH ENTITY AND USED
   26  EXCLUSIVELY FOR SUCH ENTITY'S PURPOSES. A PURCHASER  SHALL  BE  ELIGIBLE
   27  FOR REIMBURSEMENT OF THE TAX IMPOSED PURSUANT TO THIS ARTICLE IF (1) ANY
   28  TAX  IMPOSED PURSUANT TO THIS ARTICLE HAS BEEN PAID WITH RESPECT TO SUCH
   29  GALLONAGE AND THE ENTIRE AMOUNT OF SUCH TAX HAS BEEN  ABSORBED  BY  SUCH
   30  PURCHASER,  AND (2) SUCH PURCHASER POSSESSES DOCUMENTARY PROOF SATISFAC-
   31  TORY TO THE COMMISSIONER EVIDENCING THE ABSORPTION BY SUCH PURCHASER  OF
   32  THE  ENTIRE  AMOUNT  OF  SUCH TAX. PROVIDED, THAT THE COMMISSIONER SHALL
   33  REQUIRE SUCH DOCUMENTARY PROOF TO QUALIFY FOR ANY REIMBURSEMENT PROVIDED
   34  HEREUNDER AS THE COMMISSIONER DEEMS APPROPRIATE.
   35    S 2. This act shall take effect on the first day of  the  first  month
   36  next succeeding the sixtieth day after it shall have become a law.
   37                                   PART M
   38    Section 1. Subparagraphs (A) and (B) of paragraph 4 of subdivision (a)
   39  of  section  1134 of the tax law, subparagraph (A) as amended by section
   40  21-a of part U of chapter 61 of the laws of 2011 and subparagraph (B) as
   41  amended by chapter 2 of the  laws  of  1995,  are  amended  to  read  as
   42  follows:
   43    (A)  Where a person who holds a certificate of authority (i) willfully
   44  fails to file a report or return required by this article, (ii) willful-
   45  ly files, causes to be filed, gives or causes  to  be  given  a  report,
   46  return,  certificate  or  affidavit required under this article which is
   47  false, (iii) willfully fails to comply with the provisions of  paragraph
   48  two  or  three of subdivision (e) of section eleven hundred thirty-seven
   49  of this article, (iv) willfully fails  to  prepay,  collect,  truthfully
   50  account  for  or pay over any tax imposed under this article or pursuant
   51  to the authority of article twenty-nine of this chapter,  (v)  fails  to
   52  obtain  a  bond  pursuant to paragraph two of subdivision (e) of section
       S. 2609--A                         71                         A. 3009--A
    1  eleven hundred thirty-seven of this part, or  fails  to  comply  with  a
    2  notice  issued  by  the commissioner pursuant to paragraph three of such
    3  subdivision, [or] (vi) has been convicted of a  crime  provided  for  in
    4  this  chapter, OR UNDER THE PENAL LAW OF THIS STATE WHERE THE UNDERLYING
    5  CONDUCT CONSTITUTES A CRIME UNDER THIS CHAPTER, OR  IS  CONVICTED  OF  A
    6  CRIMINAL  OFFENSE  OF THE UNITED STATES, ANY OTHER STATE, OR A POLITICAL
    7  SUBDIVISION OF THIS STATE OR ANY OTHER STATE,  WHICH,  IF  COMMITTED  IN
    8  THIS STATE, WOULD CONSTITUTE A SIMILAR CRIME UNDER THIS CHAPTER OR (VII)
    9  SUCH PERSON WOULD BE INELIGIBLE TO RECEIVE SUCH CERTIFICATE OF AUTHORITY
   10  PURSUANT  TO  CLAUSES (I), (II), (IV) OR (V) OF SUBPARAGRAPH (B) OF THIS
   11  PARAGRAPH, the commissioner may revoke or suspend  such  certificate  of
   12  authority  and  all  duplicates  thereof.  Provided,  however,  that the
   13  commissioner may revoke or suspend a certificate of authority  based  on
   14  the grounds set forth in clause (vi) of this subparagraph only where the
   15  conviction  referred  to  occurred  not  more than [one year] FIVE YEARS
   16  prior to the date of revocation or suspension.
   17    (B) Where a person files a certificate of registration for  a  certif-
   18  icate of authority under this subdivision and in considering such appli-
   19  cation  the  commissioner ascertains that (i) any tax imposed under this
   20  chapter or any related statute, as defined in section  eighteen  hundred
   21  of  this chapter, has been finally determined to be due from such person
   22  and has not been paid in full, (ii) [a] ANY tax [due under this  article
   23  or any law, ordinance or resolution enacted pursuant to the authority of
   24  article  twenty-nine]  IMPOSED  BY  OR PURSUANT TO THE AUTHORITY OF THIS
   25  CHAPTER OR ANY RELATED STATUTE AS DEFINED IN SECTION EIGHTEEN HUNDRED of
   26  this chapter has been finally determined to  be  due  from  an  officer,
   27  director,  partner or employee of such person, and, where such person is
   28  a limited liability company, also a member or manager of such person, in
   29  the officer's, director's, partner's, member's, manager's or  employee's
   30  capacity as a person required to collect tax on behalf of such person or
   31  another  person  and  has  not  been  paid,  (iii)  such person has been
   32  convicted of a crime provided for in this chapter, OR  UNDER  THE  PENAL
   33  LAW OF THIS STATE WHERE THE UNDERLYING CONDUCT CONSTITUTES A CRIME UNDER
   34  THIS  CHAPTER,  OR  IS  CONVICTED  OF  A  CRIMINAL OFFENSE OF THE UNITED
   35  STATES, ANY OTHER STATE, OR A POLITICAL SUBDIVISION OF THIS STATE OR ANY
   36  OTHER STATE, WHICH, IF COMMITTED IN THIS STATE, WOULD CONSTITUTE A SIMI-
   37  LAR CRIME UNDER THIS CHAPTER within [one year] FIVE YEARS from the  date
   38  on  which  such  certificate  of registration is filed, (iv) an officer,
   39  director, partner or employee of such person, and, where such person  is
   40  a  limited  liability  company, also a member or manager of such person,
   41  which officer, director, partner,  member,  manager  or  employee  is  a
   42  person required to collect tax on behalf of such person filing a certif-
   43  icate  of  registration  has  in  the  officer's, director's, partner's,
   44  member's, manager's or employee's  capacity  as  a  person  required  to
   45  collect tax on behalf of such person or of another person been convicted
   46  of  a  crime [provided for in this chapter] SET FORTH IN CLAUSE (III) OF
   47  THIS SUBPARAGRAPH WHERE THE CONVICTION REFERRED TO OCCURRED within  [one
   48  year] FIVE YEARS from the date on which such certificate of registration
   49  is filed, (v) a shareholder owning more than fifty percent of the number
   50  of  shares  of stock of such person (where such person is a corporation)
   51  entitling the holder thereof to vote for the election  of  directors  or
   52  trustees,  OR  A  PERSON  HAVING  MORE  THAN FIFTY PERCENT OF THE VOTING
   53  RIGHTS OF SUCH PERSON (WHERE SUCH PERSON IS A LIMITED  LIABILITY  COMPA-
   54  NY),  OR  A PERSON HAVING A CONTROLLING INTEREST IN ANY FORM OF PARTNER-
   55  SHIP (CONTROLLING INTEREST MEANING MORE THAN FIFTY PERCENT OF THE  CAPI-
   56  TAL,  PROFITS OR BENEFICIAL INTEREST IN SUCH PARTNERSHIP) who owned more
       S. 2609--A                         72                         A. 3009--A
    1  than fifty percent of the number of such shares of another person (where
    2  such other person is a corporation), OR HAD MORE THAN FIFTY  PERCENT  OF
    3  THE  VOTING  RIGHTS  OF  A LIMITED LIABILITY COMPANY, OR HAD CONTROLLING
    4  INTEREST  IN  ANY FORM OF PARTNERSHIP (CONTROLLING INTEREST MEANING MORE
    5  THAN FIFTY PERCENT OF THE CAPITAL, PROFITS  OR  BENEFICIAL  INTEREST  IN
    6  SUCH  PARTNERSHIP) at the time any tax imposed under this chapter or any
    7  related statute as defined in section eighteen hundred of  this  chapter
    8  was  finally  determined to be due FROM SUCH CORPORATION, PARTNERSHIP OR
    9  LIMITED LIABILITY COMPANY and where such tax has not been paid in  full,
   10  or  at the time such other person was convicted of a crime [provided for
   11  in this chapter] SET FORTH IN CLAUSE (III) OF  THIS  SUBPARAGRAPH  WHERE
   12  THE  CONVICTION  REFERRED  TO OCCURRED within [one year] FIVE YEARS from
   13  the date on which such certificate of registration is filed, [or] (vi) a
   14  certificate of authority issued to  such  person  has  been  revoked  or
   15  suspended  pursuant  to  subparagraph  (A) of this paragraph within [one
   16  year] THREE YEARS from the date on which such certificate  of  registra-
   17  tion  is  filed,  (VII)  A  CERTIFICATE OF AUTHORITY ISSUED TO ANY OTHER
   18  PERSON HAS BEEN REVOKED OR SUSPENDED PURSUANT  TO  SUBPARAGRAPH  (A)  OF
   19  THIS  PARAGRAPH  WITHIN  THREE YEARS FROM THE DATE ON WHICH SUCH CERTIF-
   20  ICATE OF REGISTRATION IS FILED AND AN OFFICER, DIRECTOR, MEMBER,  MANAG-
   21  ER, PARTNER OR EMPLOYEE OF SUCH PERSON WAS, AT THAT TIME OF SUCH REVOCA-
   22  TION, A PERSON REQUIRED TO COLLECT TAX ON BEHALF OF SUCH PERSON AND SUCH
   23  OFFICER,  DIRECTOR,  MEMBER,  MANAGER,  PARTNER  OR EMPLOYEE IS A PERSON
   24  REQUIRED TO COLLECT TAX ON BEHALF OF THE PERSON FILING A CERTIFICATE  OF
   25  REGISTRATION,  OR  (VIII)  SUCH  PERSON HAS COMMITTED AN ACT WHICH WOULD
   26  GIVE THE COMMISSIONER THE AUTHORITY TO REVOKE OR  SUSPEND  SUCH  CERTIF-
   27  ICATE  PURSUANT TO CLAUSE (I), (II), (III), (IV), OR (V) OF SUBPARAGRAPH
   28  (A) OF THIS PARAGRAPH, the commissioner may refuse to  issue  a  certif-
   29  icate of authority.
   30    S  2.  Subparagraph  (A)  of paragraph 4 of subdivision (a) of section
   31  1134 of the tax law, as amended by chapter 2 of the  laws  of  1995,  is
   32  amended to read as follows:
   33    (A)  Where a person who holds a certificate of authority (i) willfully
   34  fails to file a report or return required by this article, (ii) willful-
   35  ly files, causes to be filed, gives or causes  to  be  given  a  report,
   36  return,  certificate  or  affidavit required under this article which is
   37  false, (iii) willfully fails to comply with the provisions of  paragraph
   38  two  or  three of subdivision (e) of section eleven hundred thirty-seven
   39  of this article, (iv) willfully fails  to  prepay,  collect,  truthfully
   40  account  for  or pay over any tax imposed under this article or pursuant
   41  to the authority of article twenty-nine of this chapter,  [or]  (v)  has
   42  been  convicted  of  a  crime provided for in this chapter, OR UNDER THE
   43  PENAL LAW OF THIS STATE WHERE THE UNDERLYING CONDUCT CONSTITUTES A CRIME
   44  UNDER THIS CHAPTER, OR IS CONVICTED OF A CRIMINAL OFFENSE OF THE  UNITED
   45  STATES, ANY OTHER STATE, OR A POLITICAL SUBDIVISION OF THIS STATE OR ANY
   46  OTHER STATE, WHICH, IF COMMITTED IN THIS STATE, WOULD CONSTITUTE A SIMI-
   47  LAR CRIME UNDER THIS CHAPTER, OR (VI) SUCH PERSON WOULD BE INELIGIBLE TO
   48  RECEIVE  SUCH  CERTIFICATE  OF  AUTHORITY PURSUANT TO CLAUSES (I), (II),
   49  (IV) OR (V) OF SUBPARAGRAPH (B) OF THIS PARAGRAPH, the commissioner  may
   50  revoke or suspend such certificate of authority and all duplicates ther-
   51  eof.  Provided,  however,  that the commissioner may revoke or suspend a
   52  certificate of authority based on the grounds set forth in clause (v) of
   53  this subparagraph only where the conviction  referred  to  occurred  not
   54  more  than  [one  year]  FIVE  YEARS  prior to the date of revocation or
   55  suspension.
       S. 2609--A                         73                         A. 3009--A
    1    S 3. Subparagraphs (C) and (E) of  paragraph  4  and  paragraph  5  of
    2  subdivision  (a) of section 1134 of the tax law, as amended by chapter 2
    3  of the laws of 1995, are amended to read as follows:
    4    (C)  In  any  of  the  foregoing  instances where the commissioner may
    5  suspend or revoke or refuse to issue a  certificate  of  authority,  the
    6  commissioner may condition the retention or issuance of a certificate of
    7  authority upon (I) the filing of a bond [or], (II) the deposit of tax in
    8  the  manner  provided  in  paragraph  two or three of subdivision (e) of
    9  section eleven hundred thirty-seven OF THIS PART, (III)  NOTWITHSTANDING
   10  PARAGRAPH  TWO  OF SUBDIVISION (A) OF THIS SECTION, THE ISSUANCE OF SUCH
   11  CERTIFICATE FOR A SPECIFIED TERM OF LESS  THAN  THREE  YEARS,  (IV)  THE
   12  FILING  OF  PART-QUARTERLY RETURNS PURSUANT TO PARAGRAPH TWO OF SUBDIVI-
   13  SION (A) OF SECTION ELEVEN HUNDRED THIRTY-SIX  OF  THIS  PART,  (V)  THE
   14  FILING OF ANY UNFILED RETURNS, (VI) ENTERING INTO AN INSTALLMENT PAYMENT
   15  AGREEMENT  OR  OTHERWISE MAKING PAYMENT ARRANGEMENTS SATISFACTORY TO THE
   16  COMMISSIONER, AND/OR (VII) SUCH OTHER  TERMS  AS  THE  COMMISSIONER  AND
   17  APPLICANT MAY AGREE TO.
   18    (E) After the commissioner has suspended or revoked a person's certif-
   19  icate  of  authority,  by  a  notice of suspension or revocation, or has
   20  refused to issue a certificate of authority, by a notice of refusal,  to
   21  such  person  and such decision has become final as provided for in this
   22  paragraph, or after a person's certificate of authority has expired,  OR
   23  A  PERSON  WAS  NOTIFIED THAT SUCH PERSON'S CERTIFICATE OF AUTHORITY WAS
   24  DEEMED TO EXPIRE PURSUANT TO PARAGRAPH FIVE OF SUBDIVISION (A)  OF  THIS
   25  SECTION and such person has failed to renew such certificate or obtain a
   26  new  certificate of authority, OR WHERE A PERSON REQUIRED TO COLLECT TAX
   27  HAS FAILED TO APPLY FOR SUCH CERTIFICATE OF AUTHORITY, ANY  such  person
   28  is  prohibited  from  engaging in any business in this state for which a
   29  certificate of authority is required.  If despite such prohibition  such
   30  person  continues  to  be  so  engaged in business, the commissioner may
   31  bring an action to enjoin such person from so engaging in business.   NO
   32  SUCH  ACTION  SHALL BE INSTITUTED BY THE COMMISSIONER BEFORE THE COMMIS-
   33  SIONER GIVES NOTICE TO THE ATTORNEY GENERAL APPRISING HIM OR HER OF SUCH
   34  ACTION AND THE NATURE AND PURPOSE THEREOF, SO THAT THE ATTORNEY  GENERAL
   35  MAY  PARTICIPATE  OR JOIN THEREIN IF IN HIS OR HER OPINION THE INTERESTS
   36  OF THE STATE SO WARRANT, AND THE COMMISSIONER  MAY  NOT  INSTITUTE  SUCH
   37  ACTION  UNTIL  TWO  WEEKS  AFTER  PROVIDING  SUCH NOTICE TO THE ATTORNEY
   38  GENERAL.
   39    (5) If the commissioner considers it necessary for the proper adminis-
   40  tration of the sales and use taxes and prepaid  taxes  imposed  by  this
   41  article  and  pursuant  to  the authority of article twenty-nine of this
   42  chapter, it may require every  person  under  this  section  or  section
   43  twelve  hundred  fifty-three  of this chapter who holds a certificate of
   44  authority to file a new certificate of registration in such form and  at
   45  such  time  as  the  commissioner  may  prescribe  and to surrender such
   46  certificate of authority. The commissioner may require such  filing  and
   47  such  surrender  not more often than once every three years; HOWEVER, IN
   48  ANY INSTANCE WHERE A HOLDER OF A CERTIFICATE OF AUTHORITY HAS FAILED  TO
   49  FILE  A  SALES TAX RETURN AS REQUIRED BY THIS CHAPTER FOR A PERIOD OF AT
   50  LEAST ONE YEAR SUCH CERTIFICATE SHALL BE DEEMED EXPIRED AND THE  COMMIS-
   51  SIONER  SHALL REQUIRE A NEW CERTIFICATE OF REGISTRATION PURSUANT TO THIS
   52  SUBDIVISION. Upon the filing of such certificate of registration and, TO
   53  THE EXTENT REQUIRED BY THE COMMISSIONER, the surrender of  such  certif-
   54  icate  of  authority,  the commissioner shall issue, within such time as
   55  the commissioner may prescribe, a new certificate of authority,  without
       S. 2609--A                         74                         A. 3009--A
    1  charge,  to  each registrant and a duplicate thereof for each additional
    2  place of business of such registrant.
    3    S  4.  Subparagraph  (i)  of paragraph 3 of subdivision (a) of section
    4  1145 of the tax law, as amended by section 48 of part K of chapter 61 of
    5  the laws of 2011, is amended to read as follows:
    6    (i) Any person required to obtain a  certificate  of  authority  under
    7  section  eleven hundred thirty-four of this part who, without possessing
    8  a valid certificate of authority, (A) sells tangible  personal  property
    9  or  services  subject  to  tax, receives amusement charges or operates a
   10  hotel, (B) purchases or sells tangible personal property for resale, (C)
   11  sells petroleum products, or (D) sells cigarettes shall, in addition  to
   12  any other penalty imposed by this chapter, be subject to a penalty in an
   13  amount  [not  exceeding]  OF  five hundred dollars [for the first] A day
   14  FROM THE FIRST DAY on which such sales or purchases are made,  [plus  an
   15  amount  not  exceeding  two  hundred  dollars for each subsequent day on
   16  which such sales or purchases are made,]  not  to  exceed  [ten]  TWENTY
   17  thousand  dollars  in  the  aggregate.  THE WILLFUL FAILURE TO OBTAIN OR
   18  MAINTAIN A VALID CERTIFICATE OF AUTHORITY SHALL BE SUBJECT TO A  PENALTY
   19  IN AN AMOUNT OF ONE THOUSAND DOLLARS A DAY FROM THE FIRST DAY SUCH SALES
   20  OR  PURCHASES  ARE  MADE,  NOT  TO  EXCEED FIFTY THOUSAND DOLLARS IN THE
   21  AGGREGATE, IN ADDITION TO THE PENALTIES IMPOSED BY  SUBDIVISION  (B)  OF
   22  SECTION EIGHTEEN HUNDRED SEVENTEEN OF THIS ARTICLE, OR ANY OTHER PENALTY
   23  IMPOSED  BY  THIS CHAPTER. FOR THE PURPOSES OF THIS SECTION, THE PENALTY
   24  FOR THE WILLFUL FAILURE TO OBTAIN OR MAINTAIN  A  VALID  CERTIFICATE  OF
   25  AUTHORITY  SHALL  BE  ALTERNATE  TO  THE  TWENTY THOUSAND DOLLAR PENALTY
   26  DESCRIBED ABOVE, AND THE TERM "WILLFUL" SHALL HAVE THE SAME  MEANING  AS
   27  "WILLFULLY"  AS  DEFINED  IN SUBDIVISION (C) OF SECTION EIGHTEEN HUNDRED
   28  ONE OF THIS CHAPTER.
   29    S 5. Subparagraphs (ii), (iii) and (iv) of paragraph 3 of  subdivision
   30  (a) of section 1145 of the tax law, as amended by chapter 65 of the laws
   31  of 1985, are amended to read as follows:
   32    (ii) Any person who fails to surrender a certificate of authority when
   33  a notice of revocation, EXPIRATION or suspension has become final shall,
   34  in  addition to any other penalty imposed by this chapter, be subject to
   35  a penalty in an amount not exceeding five hundred dollars [for the first
   36  day of such failure, together with a penalty in an amount not  exceeding
   37  two  hundred  dollars  for each subsequent] A day [of] FOR such failure,
   38  not to exceed [ten] TWENTY thousand dollars in the aggregate.
   39    (iii) Any person described in paragraph one or two of subdivision  (a)
   40  of  section eleven hundred thirty-four OF THIS PART who takes possession
   41  of or pays for business assets under circumstances  requiring  notifica-
   42  tion  by  such  person  to the [tax commission] COMMISSIONER pursuant to
   43  subdivision (c) of section eleven hundred forty-one OF THIS PART without
   44  having filed a certificate of registration pursuant  to  section  eleven
   45  hundred thirty-four OF THIS PART shall, in addition to any other penalty
   46  imposed  by  this  chapter,  be  subject  to  a penalty in an amount not
   47  exceeding two [hundred] THOUSAND dollars.
   48    (iv) If the [tax commission] COMMISSIONER determines that any  failure
   49  or  act  described in this paragraph was due to reasonable cause and not
   50  due to willful neglect, [it] HE OR SHE may remit all  or  part  of  such
   51  penalty. PROVIDED, HOWEVER, THIS CLAUSE SHALL NOT APPLY TO A PENALTY FOR
   52  THE WILLFUL FAILURE TO OBTAIN A CERTIFICATE OF AUTHORITY.
   53    S 6. Paragraph 4 of subdivision (a) of section 1145 of the tax law, as
   54  amended  by  chapter  65  of  the  laws  of  1985, is amended to read as
   55  follows:
       S. 2609--A                         75                         A. 3009--A
    1    (4) Any person required by this article to display  a  certificate  of
    2  authority,  who fails to display such certificate in the manner required
    3  by this article or any rule or regulation adopted by  the  [tax  commis-
    4  sion]  COMMISSIONER  in connection with such requirement shall, in addi-
    5  tion  to  any  other  penalty  imposed  by this chapter, be subject to a
    6  penalty of [fifty] ONE HUNDRED dollars. If the [tax commission]  COMMIS-
    7  SIONER determines that such failure was due to reasonable cause [and not
    8  due  to  willful  neglect], [it] HE OR SHE may remit all or part of such
    9  penalty.
   10    S 7. Subdivision (g) of section 1146 of the tax law, as added by chap-
   11  ter 577 of the laws of 1997, is amended to read as follows:
   12    (g) (1) Notwithstanding the provisions  of  subdivision  (a)  of  this
   13  section,  if  the  commissioner  determines  that  a  person required to
   14  collect tax is liable for any tax, penalty or interest under this  arti-
   15  cle  or  is liable for a penalty under subdivision (e) of section eleven
   16  hundred forty-five of this [article] PART with respect to  any  failure,
   17  upon  request in writing of such person, the commissioner shall disclose
   18  in writing to such person  [(1)]  (I)  the  name  of  any  other  person
   19  required  to  collect  tax  or  any other person liable for such penalty
   20  under such subdivision (e) whom the commissioner has  determined  to  be
   21  liable  for  the  same tax, penalty or interest or for such penalty with
   22  respect to such failure, and [(2)] (II)  whether  the  commissioner  has
   23  attempted  to collect such tax, penalty or interest or such penalty from
   24  such other person, the general nature of such collection activities, and
   25  the amount collected.
   26    (2) NOTWITHSTANDING ANY PROVISION OF THIS CHAPTER TO THE CONTRARY, FOR
   27  THE PURPOSES OF SUBPARAGRAPH (B) OF PARAGRAPH FOUR OF SUBDIVISION (A) OF
   28  SECTION ELEVEN HUNDRED THIRTY-FOUR OF THIS  PART,  IF  THE  COMMISSIONER
   29  DETERMINES  THAT ANY TAX IMPOSED UNDER THIS CHAPTER OR ANY RELATED STAT-
   30  UTE, AS DEFINED IN SECTION EIGHTEEN HUNDRED OF THIS  CHAPTER,  HAS  BEEN
   31  FINALLY  DETERMINED  TO BE DUE FROM A PERSON REQUIRED TO COLLECT TAX AND
   32  HAS NOT BEEN PAID, UPON WRITTEN REQUEST OF  THE  PERSON  WHO  FILED  THE
   33  CERTIFICATE  OF  REGISTRATION  FOR  A  CERTIFICATE OF AUTHORITY THAT WAS
   34  REFUSED, THE COMMISSIONER MAY DISCLOSE TO SUCH PERSON THE  NAME  OF  THE
   35  PERSON OR PERSONS REQUIRED TO COLLECT TAX WHOSE TAX LIABILITY OR LIABIL-
   36  ITIES WERE GROUNDS FOR THE REFUSAL TO ISSUE THE CERTIFICATE OF AUTHORITY
   37  AND THE AMOUNT OR AMOUNTS OF TAX DUE FOR EACH SUCH PERSON OR PERSONS.
   38    S  8.  Subdivisions  (a)  and  (b)  of section 1817 of the tax law, as
   39  amended by section 53 of part K of chapter 61 of the laws of  2011,  are
   40  amended to read as follows:
   41    (a)  Any  person  required  to obtain a certificate of authority under
   42  section eleven hundred thirty-four of this chapter who, without possess-
   43  ing a valid certificate of authority, OR  POSSESSING  A  CERTIFICATE  OF
   44  AUTHORITY  THAT WAS DEEMED TO HAVE EXPIRED PURSUANT TO PARAGRAPH FIVE OF
   45  SUBDIVISION (A) OF SECTION ELEVEN HUNDRED THIRTY-FOUR  OF  THIS  CHAPTER
   46  willfully  (1)  sells  tangible personal property or services subject to
   47  tax, receives amusement charges or operates a hotel,  (2)  purchases  or
   48  sells  tangible  personal  property  for  resale, or (3) sells petroleum
   49  products; and any person who fails to surrender a certificate of author-
   50  ity as required by such article shall be guilty of [a misdemeanor] CRIM-
   51  INAL TAX FRAUD IN THE FIFTH DEGREE.
   52    (b) Any person required to obtain a  certificate  of  authority  under
   53  section eleven hundred thirty-four of this chapter who within five years
   54  after a determination by the commissioner[,] pursuant to such section[,]
   55  to  suspend,  revoke  or  refuse to issue a certificate of authority has
   56  become final, OR WAS NOTIFIED BY  THE  COMMISSIONER  THAT  THE  PERSON'S
       S. 2609--A                         76                         A. 3009--A
    1  CERTIFICATE  OF  AUTHORITY  WAS DEEMED TO HAVE EXPIRED PURSUANT TO PARA-
    2  GRAPH FIVE OF SUBDIVISION (A) OF SECTION ELEVEN HUNDRED  THIRTY-FOUR  OF
    3  THIS CHAPTER, and without possession of a valid certificate of authority
    4  WILLFULLY  (1)  sells  tangible personal property or services subject to
    5  tax, receives amusement charges or operates a hotel,  (2)  purchases  or
    6  sells  tangible  personal  property  for  resale, or (3) sells petroleum
    7  products, shall be guilty of [a misdemeanor] CRIMINAL TAX FRAUD  IN  THE
    8  FOURTH  DEGREE.    It  shall  be an affirmative defense that such person
    9  performed the acts described in this subdivision  without  knowledge  of
   10  such determination. Any person who violates a provision of this subdivi-
   11  sion,  upon conviction, shall be subject to a fine in any amount author-
   12  ized by this article, but not less than five hundred dollars,  in  addi-
   13  tion to any other penalty provided by law.
   14    S  9. This act shall take effect immediately, provided that the amend-
   15  ments to subparagraph (A) of paragraph 4 of subdivision (a)  of  section
   16  1134  of the tax law made by section one of this act shall be subject to
   17  the expiration and reversion of such subparagraph pursuant to section 23
   18  of part U of chapter 61 of the laws of 2011, as amended when  upon  such
   19  date the provisions of section two of this act shall take effect.
   20                                   PART N
   21    Section 1. Subdivision 1 of section 480-a of the tax law is amended by
   22  adding a new paragraph (f) to read as follows:
   23    (F)  WHEN A PERSON FILES AN APPLICATION FOR A CERTIFICATE OF REGISTRA-
   24  TION UNDER THIS SECTION, AND IN CONSIDERING SUCH APPLICATION THE COMMIS-
   25  SIONER ASCERTAINS THE EXISTENCE OF  ONE  OR  MORE  OF  THE  GROUNDS  FOR
   26  REFUSAL OF A CERTIFICATE OF AUTHORITY IN CLAUSES (I), (II), (III), (IV),
   27  AND  (V)  OF  SUBPARAGRAPH  (B)  OF PARAGRAPH FOUR OF SUBDIVISION (A) OF
   28  SECTION ELEVEN HUNDRED THIRTY-FOUR OF THIS CHAPTER, THE COMMISSIONER MAY
   29  REFUSE TO ISSUE  A  CERTIFICATE  OF  REGISTRATION.  NOTWITHSTANDING  ANY
   30  PROVISION  OF  THIS CHAPTER TO THE CONTRARY, IF THE COMMISSIONER REFUSES
   31  TO ISSUE A CERTIFICATE  OF  REGISTRATION  UNDER  THIS  SUBDIVISION,  THE
   32  COMMISSIONER SHALL UPON WRITTEN REQUEST OF THE PERSON FILING SUCH APPLI-
   33  CATION  DISCLOSE THE NAME OF THE PERSON OR PERSONS WHOSE TAX LIABILITIES
   34  WERE GROUNDS FOR THE REFUSAL TO ISSUE THE CERTIFICATE OF REGISTRATION.
   35    S 2.  Paragraph (d) of subdivision 2 of section 480-a of the tax  law,
   36  as  amended  by  chapter  760 of the laws of 1992, is amended to read as
   37  follows:
   38    (d) Except as otherwise provided in this section, all  the  provisions
   39  of article twenty-eight of this chapter relating to the personal liabil-
   40  ity  for  the  tax, administration, collection and determination of tax,
   41  and deposit and disposition of revenue, including section eleven hundred
   42  thirty-eight of this  chapter  relating  to  determination  of  tax  and
   43  section  eleven  hundred forty-five of this chapter (but only paragraphs
   44  one and two of subdivision (a) of such section)  relating  to  penalties
   45  and  interest  for  failure  to file a return or pay tax within the time
   46  required, shall apply to the applications for registration and the  fees
   47  for  filing  such  applications required by this section and the penalty
   48  imposed pursuant to subdivision three of this section, as if such appli-
   49  cations were returns required under section eleven hundred thirty-six of
   50  this chapter and such filing fees, penalties  and  interest  were  taxes
   51  required  to  be paid pursuant to such article twenty-eight, in the same
   52  manner and with the same force and effect as if  the  language  of  such
   53  provisions  of  such  article twenty-eight had been incorporated in full
   54  into this article, except to the  extent  that  any  such  provision  is
       S. 2609--A                         77                         A. 3009--A
    1  either  inconsistent with a provision of this section or is not relevant
    2  thereto and with such other modifications as may be necessary  to  adapt
    3  the  language  of  such  provisions  to  the provisions of this section.
    4  [Section]  EXCEPT AS PROVIDED FOR IN PARAGRAPH (F) OF SUBDIVISION ONE OF
    5  THIS SECTION, SECTION eleven hundred thirty-four of such  article  twen-
    6  ty-eight  shall  not  apply to this section. Provided, however, that the
    7  commissioner of taxation and finance shall refund or credit an  applica-
    8  tion fee paid with respect to the registration of a vending machine or a
    9  retail  place  of  business  in  this  state through which cigarettes or
   10  tobacco products were to be sold if,  prior  to  the  beginning  of  the
   11  calendar  year  with  respect  to  which  such registration relates, the
   12  certificate of registration described in paragraph (a) of this  subdivi-
   13  sion  is  returned to the department of taxation and finance, or if such
   14  certificate has been destroyed, the retail  dealer  or  vending  machine
   15  operator  satisfactorily  accounts  to  the commissioner for the missing
   16  certificate, but such vending machine or retail place  of  business  may
   17  not  be used to sell cigarettes or tobacco products in this state during
   18  such calendar year,  unless  it  is  re-registered.  The  provisions  of
   19  section  eleven  hundred  thirty-nine of this chapter shall apply to the
   20  refund or credit authorized by  the  preceding  sentence  and  for  such
   21  purposes,  such refund or credit shall be deemed a refund of tax paid in
   22  error provided, however, no interest shall be allowed  or  paid  on  any
   23  such refund.
   24    S 3. This act shall take effect immediately and shall apply to certif-
   25  icates  of  registration  applications  filed for calendar year 2014 and
   26  thereafter.
   27                                   PART O
   28    Section 1. Subparagraph (i) of  paragraph  (b)  of  subdivision  1  of
   29  section  481  of  the  tax law, as amended by chapter 604 of the laws of
   30  2008, is amended to read as follows:
   31    (i) In addition to any other penalty  imposed  by  this  article,  the
   32  commissioner may (A) impose a penalty of not more than [one] SIX hundred
   33  [fifty] dollars for each two hundred cigarettes, or fraction thereof, in
   34  excess  of  one  thousand  cigarettes in unstamped or unlawfully stamped
   35  packages in the possession or under the control of  any  person  or  (B)
   36  impose a penalty of not more than two hundred dollars for each ten unaf-
   37  fixed  false,  altered  or counterfeit cigarette tax stamps, imprints or
   38  impressions, or fraction thereof, in the possession or under the control
   39  of any person. In addition, the commissioner may impose a penalty of not
   40  more than seventy-five dollars for each fifty cigars  or  one  pound  of
   41  tobacco,  or  fraction thereof, in excess of two hundred fifty cigars or
   42  five pounds of tobacco in the possession or under  the  control  of  any
   43  person and a penalty of not more than one hundred fifty dollars for each
   44  fifty cigars or pound of tobacco, or fraction thereof, in excess of five
   45  hundred  cigars  or ten pounds of tobacco in the possession or under the
   46  control of any person, with respect to which the  tobacco  products  tax
   47  has  not been paid or assumed by a distributor or tobacco products deal-
   48  er; provided, however, that any such penalty imposed  shall  not  exceed
   49  seven  thousand  five hundred dollars in the aggregate. The commissioner
   50  may impose a penalty of not more  than  seventy-five  dollars  for  each
   51  fifty  cigars or one pound of tobacco, or fraction thereof, in excess of
   52  fifty cigars or one pound of tobacco in  the  possession  or  under  the
   53  control  of  any tobacco products dealer or distributor appointed by the
   54  commissioner, and a penalty of not more than one hundred  fifty  dollars
       S. 2609--A                         78                         A. 3009--A
    1  for  each  fifty  cigars  or  pound  of tobacco, or fraction thereof, in
    2  excess of two hundred fifty cigars or five  pounds  of  tobacco  in  the
    3  possession  or under the control of any such dealer or distributor, with
    4  respect  to  which the tobacco products tax has not been paid or assumed
    5  by a distributor or a tobacco products dealer; provided,  however,  that
    6  any  such  penalty  imposed shall not exceed fifteen thousand dollars in
    7  the aggregate.
    8    S 2. This act shall take effect June 1, 2013.
    9                                   PART P
   10    Section 1. The tax law is amended by adding a  new  section  171-v  to
   11  read as follows:
   12    S 171-V. ENFORCEMENT OF DELINQUENT TAX LIABILITIES THROUGH THE SUSPEN-
   13  SION OF DRIVERS' LICENSES. (1) THE COMMISSIONER SHALL ENTER INTO A WRIT-
   14  TEN  AGREEMENT  WITH THE COMMISSIONER OF MOTOR VEHICLES, WHICH SHALL SET
   15  FORTH THE PROCEDURES FOR THE TWO DEPARTMENTS TO COOPERATE IN  A  PROGRAM
   16  TO IMPROVE TAX COLLECTION THROUGH THE SUSPENSION OF DRIVERS' LICENSES OF
   17  TAXPAYERS  WITH  PAST-DUE  TAX  LIABILITIES EQUAL TO OR IN EXCESS OF TEN
   18  THOUSAND DOLLARS.   FOR THE PURPOSES OF  THIS  SECTION,  THE  TERM  "TAX
   19  LIABILITIES"  SHALL  MEAN ANY TAX, SURCHARGE, OR FEE ADMINISTERED BY THE
   20  COMMISSIONER, OR ANY PENALTY OR INTEREST DUE ON THESE AMOUNTS OWED BY AN
   21  INDIVIDUAL WITH A NEW YORK DRIVER'S LICENSE, THE TERM "DRIVER'S LICENSE"
   22  MEANS ANY LICENSE ISSUED BY THE DEPARTMENT OF MOTOR VEHICLES, EXCEPT FOR
   23  A COMMERCIAL DRIVER'S LICENSE AS DEFINED IN SECTION FIVE  HUNDRED  ONE-A
   24  OF  THE VEHICLE AND TRAFFIC LAW, AND THE TERM "PAST-DUE TAX LIABILITIES"
   25  MEANS ANY TAX LIABILITY OR LIABILITIES WHICH HAVE BECOME FIXED AND FINAL
   26  SUCH THAT THE TAXPAYER NO LONGER HAS  ANY  RIGHT  TO  ADMINISTRATIVE  OR
   27  JUDICIAL REVIEW.
   28    (2) THE AGREEMENT SHALL INCLUDE THE FOLLOWING PROVISIONS:
   29    (A)  THE  PROCEDURES  BY WHICH THE DEPARTMENT SHALL NOTIFY THE COMMIS-
   30  SIONER OF MOTOR VEHICLES OF TAXPAYERS  WITH  PAST-DUE  TAX  LIABILITIES,
   31  INCLUDING  THE  PROCEDURES BY WHICH THE DEPARTMENT AND THE DEPARTMENT OF
   32  MOTOR VEHICLES SHALL SHARE THE INFORMATION NECESSARY TO  IDENTIFY  INDI-
   33  VIDUALS  WITH PAST-DUE TAX LIABILITIES, WHICH SHALL INCLUDE A TAXPAYER'S
   34  NAME, SOCIAL SECURITY NUMBER, AND ANY  OTHER  INFORMATION  NECESSARY  TO
   35  ENSURE THE PROPER IDENTIFICATION OF THE TAXPAYER;
   36    (B)  THE PROCEDURES BY WHICH THE COMMISSIONER SHALL NOTIFY THE DEPART-
   37  MENT OF MOTOR VEHICLES THAT A TAXPAYER HAS SATISFIED HIS OR HER PAST-DUE
   38  TAX LIABILITIES, OR HAS ENTERED INTO AN INSTALLMENT PAYMENT AGREEMENT OR
   39  HAS OTHERWISE MADE PAYMENT ARRANGEMENTS SATISFACTORY TO THE  COMMISSION-
   40  ER,  SO  THAT  THE  SUSPENSION OF THE TAXPAYER'S DRIVER'S LICENSE MAY BE
   41  LIFTED; AND
   42    (C) ANY OTHER MATTER THE DEPARTMENT AND THE DEPARTMENT OF MOTOR  VEHI-
   43  CLES SHALL DEEM NECESSARY TO CARRY OUT THE PROVISIONS OF THIS SECTION.
   44    (3)  THE DEPARTMENT SHALL PROVIDE NOTICE TO THE TAXPAYER OF HIS OR HER
   45  INCLUSION IN THE LICENSE SUSPENSION PROGRAM  NO  LATER  THAN  FORTY-FIVE
   46  DAYS PRIOR TO THE DATE THE DEPARTMENT INTENDS TO INFORM THE COMMISSIONER
   47  OF  MOTOR  VEHICLES OF THE TAXPAYER'S INCLUSION. HOWEVER, NO SUCH NOTICE
   48  SHALL BE ISSUED TO A TAXPAYER WHOSE WAGES ARE  BEING  GARNISHED  BY  THE
   49  DEPARTMENT FOR THE PAYMENT OF PAST-DUE TAX LIABILITIES OR PAST-DUE CHILD
   50  SUPPORT  OR COMBINED CHILD AND SPOUSAL SUPPORT ARREARS.  NOTICE SHALL BE
   51  PROVIDED BY FIRST CLASS MAIL TO THE TAXPAYER'S  LAST  KNOWN  ADDRESS  AS
   52  SUCH ADDRESS APPEARS IN THE ELECTRONIC SYSTEMS OR RECORDS OF THE DEPART-
   53  MENT. SUCH NOTICE SHALL INCLUDE:
       S. 2609--A                         79                         A. 3009--A
    1    (A)  A  CLEAR  STATEMENT  OF THE PAST-DUE TAX LIABILITIES ALONG WITH A
    2  STATEMENT THAT THE DEPARTMENT SHALL PROVIDE TO THE DEPARTMENT  OF  MOTOR
    3  VEHICLES THE TAXPAYER'S NAME, SOCIAL SECURITY NUMBER AND ANY OTHER IDEN-
    4  TIFYING  INFORMATION  NECESSARY FOR THE PURPOSE OF SUSPENDING HIS OR HER
    5  DRIVER'S  LICENSE  PURSUANT  TO  THIS  SECTION AND SUBDIVISION FOUR-F OF
    6  SECTION FIVE HUNDRED TEN OF THE VEHICLE AND TRAFFIC LAW FORTY-FIVE  DAYS
    7  AFTER THE MAILING OR SENDING OF SUCH NOTICE TO THE TAXPAYER;
    8    (B)  A  STATEMENT THAT THE TAXPAYER MAY AVOID SUSPENSION OF HIS OR HER
    9  LICENSE BY FULLY SATISFYING THE PAST-DUE TAX LIABILITIES  OR  BY  MAKING
   10  PAYMENT  ARRANGEMENTS  SATISFACTORY TO THE COMMISSIONER, AND INFORMATION
   11  AS TO HOW THE TAXPAYER CAN PAY  THE  PAST-DUE  TAX  LIABILITIES  TO  THE
   12  DEPARTMENT,  ENTER  INTO  A  PAYMENT  ARRANGEMENT  OR REQUEST ADDITIONAL
   13  INFORMATION;
   14    (C) A STATEMENT THAT THE TAXPAYER'S RIGHT TO  PROTEST  THE  NOTICE  IS
   15  LIMITED TO RAISING ISSUES SET FORTH IN SUBDIVISION FIVE OF THIS SECTION;
   16    (D) A STATEMENT THAT THE SUSPENSION OF THE TAXPAYER'S DRIVER'S LICENSE
   17  SHALL  CONTINUE UNTIL THE PAST-DUE TAX LIABILITIES ARE FULLY PAID OR THE
   18  TAXPAYER MAKES PAYMENT ARRANGEMENTS SATISFACTORY  TO  THE  COMMISSIONER;
   19  AND
   20    (E) ANY OTHER INFORMATION THAT THE COMMISSIONER DEEMS NECESSARY.
   21    (4) AFTER THE EXPIRATION OF THE FORTY-FIVE DAY PERIOD, IF THE TAXPAYER
   22  HAS  NOT  CHALLENGED  THE  NOTICE  PURSUANT  TO SUBDIVISION FIVE OF THIS
   23  SECTION AND THE TAXPAYER HAS FAILED TO SATISFY THE PAST-DUE TAX  LIABIL-
   24  ITIES OR MAKE PAYMENT ARRANGEMENTS SATISFACTORY TO THE COMMISSIONER, THE
   25  DEPARTMENT  SHALL NOTIFY THE DEPARTMENT OF MOTOR VEHICLES, IN THE MANNER
   26  AGREED UPON BY THE TWO AGENCIES, THAT THE  TAXPAYER'S  DRIVER'S  LICENSE
   27  SHALL  BE  SUSPENDED  PURSUANT  TO  SUBDIVISION  FOUR-F  OF SECTION FIVE
   28  HUNDRED TEN OF THE VEHICLE AND TRAFFIC LAW; PROVIDED,  HOWEVER,  IN  ANY
   29  CASE  WHERE  A  TAXPAYER  FAILS  TO  COMPLY  WITH THE TERMS OF A CURRENT
   30  PAYMENT ARRANGEMENT MORE THAN ONCE WITHIN A  TWELVE  MONTH  PERIOD,  THE
   31  COMMISSIONER  SHALL  IMMEDIATELY NOTIFY THE DEPARTMENT OF MOTOR VEHICLES
   32  THAT THE TAXPAYER'S DRIVER'S LICENSE SHALL BE SUSPENDED.
   33    (5) NOTWITHSTANDING ANY OTHER PROVISION OF LAW, AND EXCEPT AS  SPECIF-
   34  ICALLY  PROVIDED  HEREIN, THE TAXPAYER SHALL HAVE NO RIGHT TO COMMENCE A
   35  COURT ACTION OR PROCEEDING OR TO ANY OTHER LEGAL  RECOURSE  AGAINST  THE
   36  DEPARTMENT OR THE DEPARTMENT OF MOTOR VEHICLES REGARDING A NOTICE ISSUED
   37  BY  THE  DEPARTMENT  PURSUANT  TO  THIS  SECTION AND THE REFERRAL BY THE
   38  DEPARTMENT OF ANY TAXPAYER WITH PAST-DUE TAX LIABILITIES TO THE  DEPART-
   39  MENT  OF  MOTOR  VEHICLES  PURSUANT  TO  THIS SECTION FOR THE PURPOSE OF
   40  SUSPENDING THE TAXPAYER'S DRIVER'S LICENSE. A TAXPAYER  MAY  ONLY  CHAL-
   41  LENGE SUCH SUSPENSION OR REFERRAL ON THE GROUNDS THAT (I) THE INDIVIDUAL
   42  TO  WHOM  THE NOTICE WAS PROVIDED IS NOT THE TAXPAYER AT ISSUE; (II) THE
   43  PAST-DUE TAX LIABILITIES WERE SATISFIED; (III) THE TAXPAYER'S WAGES  ARE
   44  BEING  GARNISHED  BY  THE DEPARTMENT FOR THE PAYMENT OF THE PAST-DUE TAX
   45  LIABILITIES AT ISSUE OR FOR PAST-DUE CHILD SUPPORT OR COMBINED CHILD AND
   46  SPOUSAL SUPPORT ARREARS; (IV) THE TAXPAYER'S WAGES ARE  BEING  GARNISHED
   47  FOR  THE PAYMENT OF PAST-DUE CHILD SUPPORT OR COMBINED CHILD AND SPOUSAL
   48  SUPPORT ARREARS PURSUANT TO  AN  INCOME  EXECUTION  ISSUED  PURSUANT  TO
   49  SECTION  FIVE  THOUSAND  TWO HUNDRED FORTY-ONE OF THE CIVIL PRACTICE LAW
   50  AND RULES; (V) THE TAXPAYER'S DRIVER'S LICENSE IS A COMMERCIAL  DRIVER'S
   51  LICENSE  AS  DEFINED  IN  SECTION  FIVE HUNDRED ONE-A OF THE VEHICLE AND
   52  TRAFFIC LAW; OR (VI) THE DEPARTMENT INCORRECTLY FOUND THAT THE  TAXPAYER
   53  HAS  FAILED  TO COMPLY WITH THE TERMS OF A PAYMENT ARRANGEMENT MADE WITH
   54  THE COMMISSIONER MORE THAN ONCE WITHIN A TWELVE  MONTH  PERIOD  FOR  THE
   55  PURPOSES OF SUBDIVISION THREE OF THIS SECTION.
       S. 2609--A                         80                         A. 3009--A
    1    HOWEVER,  NOTHING  IN THIS SUBDIVISION IS INTENDED TO LIMIT A TAXPAYER
    2  FROM SEEKING RELIEF FROM JOINT AND SEVERAL LIABILITY PURSUANT TO SECTION
    3  SIX HUNDRED FIFTY-FOUR OF THIS CHAPTER, TO THE EXTENT THAT HE OR SHE  IS
    4  ELIGIBLE PURSUANT TO THAT SUBDIVISION, OR ESTABLISHING TO THE DEPARTMENT
    5  THAT  THE  ENFORCEMENT OF THE UNDERLYING TAX LIABILITIES HAS BEEN STAYED
    6  BY THE FILING OF A PETITION PURSUANT TO  THE  BANKRUPTCY  CODE  OF  1978
    7  (TITLE ELEVEN OF THE UNITED STATES CODE).
    8    (6) NOTWITHSTANDING ANY PROVISION OF THIS CHAPTER TO THE CONTRARY, THE
    9  DEPARTMENT MAY DISCLOSE TO THE DEPARTMENT OF MOTOR VEHICLES THE INFORMA-
   10  TION  DESCRIBED  IN  THIS SECTION THAT, IN THE DISCRETION OF THE COMMIS-
   11  SIONER, IS  NECESSARY  FOR  THE  PROPER  IDENTIFICATION  OF  A  TAXPAYER
   12  REFERRED TO THE DEPARTMENT OF MOTOR VEHICLES FOR THE PURPOSE OF SUSPEND-
   13  ING  THE TAXPAYER'S DRIVER'S LICENSE PURSUANT TO THIS SECTION AND SUBDI-
   14  VISION FOUR-F OF SECTION FIVE HUNDRED TEN OF  THE  VEHICLE  AND  TRAFFIC
   15  LAW.  THE  DEPARTMENT OF MOTOR VEHICLES MAY NOT REDISCLOSE THIS INFORMA-
   16  TION TO ANY OTHER ENTITY OR  PERSON,  OTHER  THAN  FOR  THE  PURPOSE  OF
   17  INFORMING  THE  TAXPAYER  THAT  HIS  OR  HER  DRIVER'S  LICENSE HAS BEEN
   18  SUSPENDED.
   19    (7) EXCEPT AS OTHERWISE PROVIDED IN THIS SECTION,  THE  ACTIVITIES  TO
   20  COLLECT  PAST-DUE  TAX LIABILITIES UNDERTAKEN BY THE DEPARTMENT PURSUANT
   21  TO THIS SECTION SHALL NOT IN ANY  WAY  LIMIT,  RESTRICT  OR  IMPAIR  THE
   22  DEPARTMENT FROM EXERCISING ANY OTHER AUTHORITY TO COLLECT OR ENFORCE TAX
   23  LIABILITIES UNDER ANY OTHER APPLICABLE PROVISION OF LAW.
   24    S 2. Section 510 of the vehicle and traffic law is amended by adding a
   25  new subdivision 4-f to read as follows:
   26    4-F.  SUSPENSION  FOR FAILURE TO PAY PAST-DUE TAX LIABILITIES. (1) THE
   27  COMMISSIONER SHALL ENTER INTO A WRITTEN AGREEMENT WITH THE  COMMISSIONER
   28  OF   TAXATION   AND   FINANCE,   AS  PROVIDED  IN  SECTION  ONE  HUNDRED
   29  SEVENTY-ONE-V OF THE TAX LAW, WHICH SHALL SET FORTH THE  PROCEDURES  FOR
   30  SUSPENDING  THE  DRIVERS'  LICENSES  OF  INDIVIDUALS  WHO HAVE FAILED TO
   31  SATISFY PAST-DUE TAX LIABILITIES AS  SUCH  TERMS  ARE  DEFINED  IN  SUCH
   32  SECTION.
   33    (2)  UPON  RECEIPT OF NOTIFICATION FROM THE DEPARTMENT OF TAXATION AND
   34  FINANCE THAT AN INDIVIDUAL HAS FAILED TO SATISFY  PAST-DUE  TAX  LIABIL-
   35  ITIES,  OR  TO  OTHERWISE  MAKE PAYMENT ARRANGEMENTS SATISFACTORY TO THE
   36  COMMISSIONER OF TAXATION AND FINANCE, OR HAS FAILED TO COMPLY  WITH  THE
   37  TERMS  OF SUCH PAYMENT ARRANGEMENTS MORE THAN ONCE WITHIN A TWELVE MONTH
   38  PERIOD, THE COMMISSIONER OR HIS OR HER AGENT SHALL SUSPEND  THE  LICENSE
   39  OF  SUCH  PERSON TO OPERATE A MOTOR VEHICLE. IN THE EVENT SUCH PERSON IS
   40  UNLICENSED, SUCH PERSON'S PRIVILEGE OF  OBTAINING  A  LICENSE  SHALL  BE
   41  SUSPENDED.  SUCH SUSPENSION SHALL TAKE EFFECT NO LATER THAN FIFTEEN DAYS
   42  FROM THE DATE OF THE NOTICE THEREOF PROVIDED TO THE PERSON WHOSE LICENSE
   43  OR PRIVILEGE OF OBTAINING A LICENSE IS TO BE SUSPENDED, AND SHALL REMAIN
   44  IN EFFECT UNTIL SUCH TIME AS THE COMMISSIONER IS ADVISED THAT THE PERSON
   45  HAS SATISFIED HIS OR HER PAST-DUE TAX LIABILITIES, OR HAS OTHERWISE MADE
   46  PAYMENT ARRANGEMENTS SATISFACTORY TO THE COMMISSIONER  OF  TAXATION  AND
   47  FINANCE.
   48    (3)  FROM  THE  TIME THE COMMISSIONER IS NOTIFIED BY THE DEPARTMENT OF
   49  TAXATION AND FINANCE UNDER  THIS  SECTION,  THE  COMMISSIONER  SHALL  BE
   50  RELIEVED  FROM  ALL  LIABILITY  TO SUCH PERSON WHICH MAY OTHERWISE ARISE
   51  UNDER THIS SECTION, AND SUCH PERSON SHALL HAVE NO RIGHT  TO  COMMENCE  A
   52  COURT  ACTION  OR  PROCEEDING OR TO ANY OTHER LEGAL RECOURSE AGAINST THE
   53  COMMISSIONER TO RECOVER SUCH DRIVING PRIVILEGES AS  AUTHORIZED  BY  THIS
   54  SECTION.  IN  ADDITION, NOTWITHSTANDING ANY OTHER PROVISION OF LAW, SUCH
   55  PERSON SHALL HAVE NO RIGHT TO A HEARING OR APPEAL PURSUANT TO THIS CHAP-
       S. 2609--A                         81                         A. 3009--A
    1  TER WITH RESPECT TO A SUSPENSION OF DRIVING PRIVILEGES AS AUTHORIZED  BY
    2  THIS SECTION.
    3    (4)  NOTWITHSTANDING ANY PROVISION OF LAW TO THE CONTRARY, THE DEPART-
    4  MENT SHALL FURNISH THE DEPARTMENT  OF  TAXATION  AND  FINANCE  WITH  THE
    5  INFORMATION  NECESSARY  FOR  THE  PROPER IDENTIFICATION OF AN INDIVIDUAL
    6  REFERRED TO THE DEPARTMENT FOR THE PURPOSE OF DRIVER'S  LICENSE  SUSPEN-
    7  SION  PURSUANT  TO THIS SECTION AND SECTION ONE HUNDRED SEVENTY-ONE-V OF
    8  THE TAX LAW. THIS SHALL INCLUDE THE INDIVIDUAL'S NAME,  SOCIAL  SECURITY
    9  NUMBER  AND  ANY  OTHER  INFORMATION  THE COMMISSIONER OF MOTOR VEHICLES
   10  DEEMS NECESSARY.
   11    (5) ANY PERSON WHOSE DRIVER'S LICENSE IS SUSPENDED PURSUANT  TO  PARA-
   12  GRAPH TWO OF THIS SUBDIVISION MAY APPLY FOR THE ISSUANCE OF A RESTRICTED
   13  USE LICENSE AS PROVIDED IN SECTION FIVE HUNDRED THIRTY OF THIS TITLE.
   14    S  3.  Subdivision 7 of section 511 of the vehicle and traffic law, as
   15  added by chapter 81 of the laws of 1995, is amended to read as follows:
   16    7. Exceptions. When a person is convicted of a violation  of  subdivi-
   17  sion  one  [of]  OR  two  of this section, and the suspension was issued
   18  pursuant to (A) subdivision four-e of section five hundred ten  of  this
   19  article  due  to a support arrears, OR (B) SUBDIVISION FOUR-F OF SECTION
   20  FIVE HUNDRED TEN OF THE ARTICLE DUE TO  PAST-DUE  TAX  LIABILITIES,  the
   21  mandatory  penalties set forth in subdivision one or two of this section
   22  shall not be applicable if, on or before the return date  or  subsequent
   23  adjourned  date, such person presents proof that such support arrears OR
   24  PAST-DUE TAX LIABILITIES have  been  satisfied  as  shown  by  certified
   25  check,  notice  issued  by  the court ordering the suspension, or notice
   26  from a support collection unit OR DEPARTMENT OF TAXATION AND FINANCE  AS
   27  APPLICABLE.  The sentencing court shall take the satisfaction of arrears
   28  OR THE PAYMENT OF THE PAST-DUE TAX LIABILITIES into account when  impos-
   29  ing  a sentence for any such conviction. FOR LICENSES SUSPENDED FOR NON-
   30  PAYMENT OF PAST-DUE TAX LIABILITIES, THE  COURT  SHALL  ALSO  TAKE  INTO
   31  CONSIDERATION  PROOF,  IN  THE  FORM  OF A NOTICE FROM THE DEPARTMENT OF
   32  TAXATION AND FINANCE, THAT SUCH PERSON  HAS  MADE  PAYMENT  ARRANGEMENTS
   33  THAT ARE SATISFACTORY TO THE COMMISSIONER OF TAXATION AND FINANCE.
   34    S 4. Section 530 of the vehicle and traffic law is amended by adding a
   35  new subdivision 5-b to read as follows:
   36    (5-B)  ISSUANCE  OF  A  RESTRICTED  LICENSE SHALL NOT BE DENIED TO ANY
   37  PERSON WHOSE LICENSE IS SUSPENDED  PURSUANT  TO  SUBDIVISION  FOUR-F  OF
   38  SECTION  FIVE  HUNDRED  TEN OF THIS TITLE FOR ANY REASON OTHER THAN SUCH
   39  PERSON'S FAILURE  TO  OTHERWISE  HAVE  A  VALID  OR  RENEWABLE  DRIVER'S
   40  LICENSE. THE RESTRICTIONS ON THE TYPES OF VEHICLES WHICH MAY BE OPERATED
   41  WITH  A  RESTRICTED  LICENSE  CONTAINED IN SUCH SUBDIVISION FIVE OF THIS
   42  SECTION SHALL NOT BE APPLICABLE TO A  RESTRICTED  LICENSE  ISSUED  TO  A
   43  PERSON  PURSUANT  TO  SUBDIVISION  FOUR-F OF SECTION FIVE HUNDRED TEN OF
   44  THIS TITLE. THE ISSUANCE OF A RESTRICTED LICENSE ISSUED AS A RESULT OF A
   45  SUSPENSION UNDER SUBDIVISION FOUR-F OF SECTION FIVE HUNDRED TEN OF  THIS
   46  TITLE  SHALL  NOT  IN  ANY  WAY  AFFECT  A  PERSON'S  ELIGIBILITY  FOR A
   47  RESTRICTED LICENSE AT SOME FUTURE TIME.
   48    S 5. Section 2335-a of the insurance law, as added by chapter  152  of
   49  the laws of 1998, is amended to read as follows:
   50    S  2335-a. Prohibition of rate increases for persons involved in emer-
   51  gency use of vehicles OR DUE TO A DRIVER'S LICENSE SUSPENSION FOR  PAST-
   52  DUE TAX LIABILITIES.
   53    (A)  No insurer authorized to transact or transacting business in this
   54  state, or controlling or controlled by or under  common  control  by  or
   55  with  an  insurer authorized to transact or transacting business in this
   56  state, [which] THAT sells a policy  providing  motor  vehicle  liability
       S. 2609--A                         82                         A. 3009--A
    1  insurance  coverage  in this state, shall increase the policy premium in
    2  connection with the insurance permitted  or  required  by  this  chapter
    3  solely  because the insured or any other person who customarily operates
    4  an  automobile covered by the policy has had an accident while operating
    5  a motor vehicle in response to  an  emergency,  where  the  insured  was
    6  either responding to a call to duty as a paid or volunteer member of any
    7  police  or  fire department or first aid squad[;], or was performing any
    8  other function on behalf of the state, any political subdivision  there-
    9  of, a public authority, public benefit corporation, or any other govern-
   10  mental agency or instrumentality in a public emergency.
   11    (B)  NO INSURER AUTHORIZED TO TRANSACT OR TRANSACTING BUSINESS IN THIS
   12  STATE, OR CONTROLLING OR CONTROLLED BY OR UNDER  COMMON  CONTROL  BY  OR
   13  WITH  AN  INSURER AUTHORIZED TO TRANSACT OR TRANSACTING BUSINESS IN THIS
   14  STATE, THAT SELLS A POLICY PROVIDING MOTOR VEHICLE INSURANCE COVERAGE IN
   15  THIS STATE SHALL INCREASE THE POLICY  PREMIUM  IN  CONNECTION  WITH  THE
   16  INSURANCE  PERMITTED  OR  REQUIRED  BY  THIS  CHAPTER SOLELY BECAUSE THE
   17  INSURED OR ANY OTHER  PERSON  WHO  CUSTOMARILY  OPERATES  AN  AUTOMOBILE
   18  COVERED  BY  THE  POLICY  HAS  HAD HIS OR HER DRIVER'S LICENSE SUSPENDED
   19  PURSUANT TO SUBDIVISION FOUR-F OF SECTION FIVE HUNDRED TEN OF THE  VEHI-
   20  CLE  AND TRAFFIC LAW FOR PAST-DUE TAX LIABILITIES, AS DEFINED IN SECTION
   21  ONE HUNDRED SEVENTY-ONE-V OF THE TAX LAW, OR HAS APPLIED FOR OR RECEIVED
   22  A RESTRICTED USE LICENSE AS PROVIDED FOR BY SECTION FIVE HUNDRED  THIRTY
   23  OF THE VEHICLE AND TRAFFIC LAW, AS THE RESULT OF SUCH SUSPENSION.
   24    S 6. The insurance law is amended by adding a new section 2616 to read
   25  as follows:
   26    S  2616.  DISCRIMINATION  BECAUSE OF A DRIVER'S LICENSE SUSPENSION FOR
   27  PAST-DUE TAX LIABILITIES. AN INDIVIDUAL OR ENTITY SHALL  NOT  REFUSE  TO
   28  ISSUE  ANY  POLICY  OF  MOTOR VEHICLE INSURANCE, OR CANCEL OR DECLINE TO
   29  RENEW SUCH POLICY, BECAUSE THE APPLICANT OR POLICY HOLDER HAS HAD HIS OR
   30  HER DRIVER'S LICENSE SUSPENDED PURSUANT TO SUBDIVISION FOUR-F OF SECTION
   31  FIVE HUNDRED TEN OF THE VEHICLE AND TRAFFIC LAW FOR PAST-DUE TAX LIABIL-
   32  ITIES, AS DEFINED IN SECTION ONE HUNDRED SEVENTY-ONE-V OF THE  TAX  LAW,
   33  OR HAS APPLIED FOR OR RECEIVED A RESTRICTED USE LICENSE, AS PROVIDED FOR
   34  BY  SECTION  FIVE  HUNDRED THIRTY OF THE VEHICLE AND TRAFFIC LAW, AS THE
   35  RESULT OF SUCH SUSPENSION.
   36    S 7. This act shall take effect immediately; provided,  however,  that
   37  the department of taxation and finance and the department of motor vehi-
   38  cles  shall have up to six months after this act shall have become a law
   39  to execute the written agreement and implement the necessary  procedures
   40  as described in sections one and two of this act.
   41                                   PART Q
   42    Section  1.  The  tax  law is amended by adding a new section 174-c to
   43  read as follows:
   44    S 174-C. SERVICE OF INCOME EXECUTION WITHOUT FILING  A  WARRANT.    1.
   45  NOTWITHSTANDING  ANY PROVISION OF LAW TO THE CONTRARY, IF ANY INDIVIDUAL
   46  LIABLE FOR THE PAYMENT OF ANY TAX OR OTHER  IMPOSITION  ADMINISTERED  BY
   47  THE COMMISSIONER, INCLUDING ANY ADDITIONS TO TAX, PENALTIES AND INTEREST
   48  IN CONNECTION THEREWITH, FAILS TO PAY OR TO COLLECT OR PAY OVER THE SAME
   49  WITHIN  TWENTY-ONE  CALENDAR  DAYS  AFTER  NOTICE AND DEMAND THEREFOR IS
   50  GIVEN TO SUCH INDIVIDUAL (TEN BUSINESS DAYS IF THE AMOUNT FOR WHICH SUCH
   51  NOTICE AND DEMAND  IS  MADE  EQUALS  OR  EXCEEDS  ONE  HUNDRED  THOUSAND
   52  DOLLARS), THE COMMISSIONER IS AUTHORIZED TO SERVE AN INCOME EXECUTION ON
   53  THE  INDIVIDUAL  OR ON THE PERSON FROM WHOM THE INDIVIDUAL IS RECEIVING,
   54  OR WILL RECEIVE, MONEY, WITHOUT FILING A WARRANT IN THE  OFFICE  OF  THE
       S. 2609--A                         83                         A. 3009--A
    1  CLERK  OF  THE  APPROPRIATE  COUNTY  OR  IN  THE  DEPARTMENT OF STATE AS
    2  PROVIDED FOR  IN  THIS  CHAPTER.  FOR  PURPOSES  OF  SERVING  AN  INCOME
    3  EXECUTION PURSUANT TO THIS SECTION, THE COMMISSIONER SHALL, IN THE RIGHT
    4  OF THE PEOPLE OF THE STATE OF NEW YORK, BE DEEMED TO HAVE OBTAINED JUDG-
    5  MENT  AGAINST  THE  INDIVIDUAL  FOR THE TAX OR OTHER IMPOSITION, AND THE
    6  ADDITIONS TO TAX, PENALTIES AND  INTEREST  IN  CONNECTION  THEREOF,  AND
    7  THERE  SHALL BE A LIEN ON THE AMOUNT OF THE INDIVIDUAL'S INCOME THAT MAY
    8  BE GARNISHED. IF THE COMMISSIONER CHOOSES TO SERVE AN  INCOME  EXECUTION
    9  WITHOUT FILING A WARRANT PURSUANT TO THIS SECTION, THE COMMISSIONER MUST
   10  SERVE  THE  INCOME  EXECUTION  WITHIN  SIX  YEARS AFTER THE FIRST DATE A
   11  WARRANT COULD BE FILED PURSUANT TO SECTION ONE HUNDRED SEVENTY-FOUR-B OF
   12  THIS ARTICLE. WHEN SERVING AN INCOME EXECUTION WITHOUT THE FILING  OF  A
   13  WARRANT,  THE  COMMISSIONER  SHALL  FOLLOW  THE  PROCEDURES SET FORTH IN
   14  SECTION FIVE THOUSAND TWO HUNDRED THIRTY-ONE OF THE CIVIL  PRACTICE  LAW
   15  AND  RULES,  WITH THE REFERENCES IN SUCH SECTION TO "SHERIFF" TO BE READ
   16  AS  REFERRING  TO  THE  COMMISSIONER  OR  THE  DEPARTMENT.  SUCH  INCOME
   17  EXECUTION  SHALL CONTINUE TO BE IN EFFECT UNTIL SUCH LIABILITY IS SATIS-
   18  FIED OR UNTIL TWENTY YEARS FROM THE FIRST DATE A WARRANT COULD BE  FILED
   19  BY  THE  COMMISSIONER  PURSUANT TO SECTION ONE HUNDRED SEVENTY-FOUR-B OF
   20  THIS ARTICLE, WHETHER OR NOT A WARRANT IS FILED FOR THAT LIABILITY.
   21    2. THE PROVISIONS OF THIS SECTION SHALL BE IN ADDITION TO  THE  PROCE-
   22  DURES  RELATING TO COLLECTION OR ADMINISTRATION PROVIDED WITH RESPECT TO
   23  ANY TAX OR OTHER IMPOSITION ADMINISTERED BY THE  COMMISSIONER.  WHERE  A
   24  PROVISION  OF  THIS SECTION IS INCONSISTENT WITH ANY SUCH PROVISION WITH
   25  RESPECT TO SUCH TAX OR OTHER IMPOSITION, THE PROVISIONS OF THIS  SECTION
   26  WILL  APPLY. NOTHING IN THIS SECTION SHALL PREVENT THE COMMISSIONER FROM
   27  TIMELY FILING A WARRANT IN ORDER TO PURSUE ANY OF THE COLLECTION METHODS
   28  AUTHORIZED UNDER ARTICLE FIFTY-TWO OF THE CIVIL PRACTICE LAW AND RULES.
   29    S 2. This act shall take effect immediately.
   30                                   PART R
   31    Section 1. Subparagraph (i) of the opening paragraph of  section  1210
   32  of  the  tax law is REPEALED and a new subparagraph (i) is added to read
   33  as follows:
   34    (I) WITH RESPECT TO A CITY OF ONE MILLION OR MORE  AND  THE  FOLLOWING
   35  COUNTIES (1) ANY SUCH CITY HAVING A POPULATION OF ONE MILLION OR MORE IS
   36  HEREBY  AUTHORIZED  AND  EMPOWERED  TO ADOPT AND AMEND LOCAL LAWS, ORDI-
   37  NANCES OR RESOLUTIONS IMPOSING SUCH TAXES IN ANY SUCH CITY, AT THE  RATE
   38  OF FOUR AND ONE-HALF PERCENT;
   39    (2)  THE FOLLOWING COUNTIES THAT IMPOSE TAXES DESCRIBED IN SUBDIVISION
   40  (A) OF THIS SECTION AT THE RATE OF THREE PERCENT AS AUTHORIZED ABOVE  IN
   41  THIS  PARAGRAPH  FOR  SUCH  COUNTIES  ARE  HEREBY FURTHER AUTHORIZED AND
   42  EMPOWERED TO ADOPT AND AMEND  LOCAL  LAWS,  ORDINANCES,  OR  RESOLUTIONS
   43  IMPOSING  SUCH TAXES DESCRIBED IN SUBDIVISION (A) OF THIS SECTION AT THE
   44  FOLLOWING ADDITIONAL RATES, IN QUARTER PERCENT INCREMENTS,  WHICH  RATES
   45  ARE  ADDITIONAL TO THE THREE PERCENT RATE AUTHORIZED ABOVE IN THIS PARA-
   46  GRAPH, AND, IN THE CASE OF A COUNTY AUTHORIZED TO IMPOSE MORE  THAN  ONE
   47  ADDITIONAL  RATE,  ALSO IN ADDITION TO EACH OTHER, FOR EACH SUCH COUNTY,
   48  PROVIDED THAT (A) THE COUNTY OF ROCKLAND MAY IMPOSE ADDITIONAL RATES  OF
   49  FIVE-EIGHTHS PERCENT AND THREE-EIGHTHS PERCENT, IN LIEU OF IMPOSING SUCH
   50  ADDITIONAL RATE IN QUARTER PERCENT INCREMENTS; (B) THE COUNTY OF ONTARIO
   51  MAY  IMPOSE  ADDITIONAL  RATES  OF  ONE-EIGHTH PERCENT AND THREE-EIGHTHS
   52  PERCENT, IN LIEU OF IMPOSING SUCH ADDITIONAL  RATE  IN  QUARTER  PERCENT
   53  INCREMENTS; (C) THREE-QUARTERS PERCENT OF THE ADDITIONAL RATE AUTHORIZED
       S. 2609--A                         84                         A. 3009--A
    1  TO BE IMPOSED BY THE COUNTY OF NASSAU SHALL BE SUBJECT TO THE LIMITATION
    2  SET FORTH IN SECTION TWELVE HUNDRED SIXTY-TWO-E OF THIS ARTICLE:
    3    (A) ONE-QUARTER OF ONE PERCENT - NONE.
    4    (B) ONE-HALF OF ONE PERCENT - CHAUTAUQUA, ONTARIO, SCHENECTADY.
    5    (C) THREE-QUARTERS OF ONE PERCENT - DUTCHESS, ESSEX, JEFFERSON, LEWIS,
    6  ORANGE.
    7    (D)  ONE  PERCENT  -  ALBANY,  BROOME,  CATTARAUGUS,  CAYUGA, CHEMUNG,
    8  CHENANGO, CLINTON, COLUMBIA, CORTLAND, DELAWARE, FRANKLIN, FULTON, GENE-
    9  SEE, GREENE, LIVINGSTON, MADISON, MONROE, MONTGOMERY, NIAGARA, ONONDAGA,
   10  ORLEANS,  OSWEGO,  OTSEGO,  PUTNAM,  RENSSELAER,  ROCKLAND,   SCHOHARIE,
   11  SCHUYLER,  SENECA,  STEUBEN, SUFFOLK, SULLIVAN, TIOGA, TOMPKINS, ULSTER,
   12  WAYNE, WYOMING, YATES.
   13    (E) ONE AND ONE-QUARTER PERCENT - HERKIMER, NASSAU.
   14    (F) ONE AND ONE-HALF PERCENT - ALLEGANY.
   15    (G) ONE AND THREE-QUARTERS PERCENT - ERIE, ONEIDA.
   16    S 2. Subparagraph (ii) of the opening paragraph of section 1210 of the
   17  tax law is REPEALED and a new subparagraph (ii)  is  added  to  read  as
   18  follows:
   19     (II)  THE FOLLOWING CITIES THAT IMPOSE TAXES DESCRIBED IN SUBDIVISION
   20  (A) OF THIS SECTION AT THE RATE OF ONE AND ONE-HALF PERCENT OR HIGHER AS
   21  AUTHORIZED ABOVE IN THIS PARAGRAPH FOR SUCH CITIES  ARE  HEREBY  FURTHER
   22  AUTHORIZED  AND  EMPOWERED TO ADOPT AND AMEND LOCAL LAWS, ORDINANCES, OR
   23  RESOLUTIONS IMPOSING SUCH TAXES DESCRIBED IN  SUBDIVISION  (A)  OF  THIS
   24  SECTION  AT  THE  FOLLOWING  ADDITIONAL RATES, IN QUARTER PERCENT INCRE-
   25  MENTS, WHICH RATES ARE ADDITIONAL TO THE ONE  AND  ONE-HALF  PERCENT  OR
   26  HIGHER  RATES  AUTHORIZED  ABOVE IN THIS PARAGRAPH AND, IN THE CASE OF A
   27  CITY AUTHORIZED TO IMPOSE MORE THAN ONE ADDITIONAL RATE, ALSO  IN  ADDI-
   28  TION TO EACH OTHER, FOR EACH SUCH CITY:
   29    (1) ONE-QUARTER OF ONE PERCENT - NONE.
   30    (2) ONE-HALF OF ONE PERCENT - NONE.
   31    (3) THREE-QUARTERS OF ONE PERCENT - NONE.
   32    (4) ONE PERCENT - MOUNT VERNON; YONKERS; OSWEGO, FOR THE PERIOD BEGIN-
   33  NING DECEMBER FIRST, TWO THOUSAND ELEVEN, AND ENDING NOVEMBER THIRTIETH,
   34  TWO  THOUSAND  THIRTEEN;  NEW ROCHELLE, FOR THE PERIOD BEGINNING JANUARY
   35  FIRST, TWO THOUSAND TWELVE, AND ENDING DECEMBER THIRTY-FIRST, TWO  THOU-
   36  SAND  THIRTEEN;  WHITE PLAINS, FOR THE PERIOD BEGINNING SEPTEMBER FIRST,
   37  TWO THOUSAND ELEVEN, AND ENDING AUGUST THIRTY-FIRST, TWO THOUSAND  THIR-
   38  TEEN.
   39    (5) ONE AND ONE-QUARTER PERCENT - NONE.
   40    (6) ONE AND ONE-HALF PERCENT - NONE.
   41    (7) ONE AND THREE-QUARTERS PERCENT - NONE.
   42    S  3.  Subparagraph  (iii) of the opening paragraph of section 1210 of
   43  the tax law is REPEALED and a new subparagraph (iii) is added to read as
   44  follows:
   45    (III)  THE  MAXIMUM  RATE  REFERRED  TO  IN  SECTION  TWELVE   HUNDRED
   46  TWENTY-FOUR OF THIS ARTICLE SHALL BE CALCULATED WITHOUT REFERENCE TO THE
   47  ADDITIONAL  RATES  AUTHORIZED  FOR  COUNTIES, OTHER THAN THE COUNTIES OF
   48  CAYUGA, CORTLAND, FULTON, MADISON, AND OTSEGO IN  SUBPARAGRAPH  (I)  AND
   49  THE CITIES IN SUBPARAGRAPH (II) OF THIS PARAGRAPH.
   50    S  4.  Section 1210 of the tax law is amended by adding a new subdivi-
   51  sion (q) to read as follows:
   52    (Q) NOTWITHSTANDING ANY PROVISION OF THIS SECTION OR ANY OTHER LAW,  A
   53  COUNTY  MAY, BY A MAJORITY VOTE OF ITS GOVERNING BODY, PASS A LOCAL LAW,
   54  ORDINANCE OR RESOLUTION TO IMPOSE THE ADDITIONAL RATE OR RATES  OF  SUCH
   55  SALES  AND  COMPENSATING  USE TAXES AUTHORIZED BY CLAUSE TWO OF SUBPARA-
   56  GRAPH (I) OF THE OPENING PARAGRAPH OF THIS SECTION FOR A PERIOD  NOT  TO
       S. 2609--A                         85                         A. 3009--A
    1  EXCEED  TWO  YEARS.   ANY SUCH LOCAL LAW, ORDINANCE, OR RESOLUTION SHALL
    2  ALSO BE SUBJECT TO THE PROVISIONS OF SUBDIVISIONS (D) AND  (E)  OF  THIS
    3  SECTION.
    4    S 5. Section 1210-E of the tax law is REPEALED.
    5    S  6.  Subdivisions  (d),  (e), (f), (g), (h) (i), (j), (k), (l), (m),
    6  (n), (o), (p), (q), (r), (t), (u), (v), (w), (x), (y), (z), (z-1), (aa),
    7  (bb), (cc), (dd), (ee), (ff) and (gg) of section 1224 of the tax law are
    8  REPEALED.
    9    S 7. Section 1224 of the tax law is amended by adding four new  subdi-
   10  visions (d),(e), (f), and (g) to read as follows:
   11    (D)  FOR  PURPOSES  OF THIS SECTION, THE TERM "PRIOR RIGHT" SHALL MEAN
   12  THE PREFERENTIAL RIGHT TO IMPOSE ANY TAX DESCRIBED  IN  SECTIONS  TWELVE
   13  HUNDRED  TWO  AND TWELVE HUNDRED THREE, OR TWELVE HUNDRED TEN AND TWELVE
   14  HUNDRED ELEVEN, OF THIS ARTICLE AND THEREBY TO PREEMPT SUCH TAX  AND  TO
   15  PRECLUDE  ANOTHER  MUNICIPAL CORPORATION FROM IMPOSING OR CONTINUING THE
   16  IMPOSITION OF SUCH TAX TO THE  EXTENT  THAT  SUCH  RIGHT  IS  EXERCISED.
   17  HOWEVER, THE RIGHT OF PREEMPTION SHALL ONLY APPLY WITHIN THE TERRITORIAL
   18  LIMITS OF THE TAXING JURISDICTION HAVING THE RIGHT OR PREEMPTION.
   19    (E)  EACH  OF  THE  FOLLOWING  COUNTIES AND CITIES SHALL HAVE THE SOLE
   20  RIGHT TO IMPOSE THE FOLLOWING ADDITIONAL RATE OF SALES AND  COMPENSATING
   21  USE TAXES IN EXCESS OF THREE PERCENT THAT SUCH COUNTY OR CITY IS AUTHOR-
   22  IZED  TO  IMPOSE PURSUANT TO THE AUTHORITY OF SUBDIVISION (A) OF SECTION
   23  TWELVE HUNDRED TEN OF THIS ARTICLE. SUCH ADDITIONAL RATES OF  TAX  SHALL
   24  NOT BE SUBJECT TO PREEMPTION.
   25    (1) COUNTIES:
   26    (A) ONE-QUARTER OF ONE PERCENT - NONE.
   27    (B) ONE-HALF OF ONE PERCENT - CHAUTAUQUA, ONTARIO, SCHENECTADY.
   28    (C) THREE-QUARTERS OF ONE PERCENT - DUTCHESS, ESSEX, JEFFERSON, LEWIS,
   29  ORANGE.
   30    (D)  ONE  PERCENT  -  ALBANY,  BROOME, CATTARAUGUS, CHEMUNG, CHENANGO,
   31  CLINTON, COLUMBIA,  DELAWARE,  FRANKLIN,  GENESEE,  GREENE,  LIVINGSTON,
   32  MONROE,  MONTGOMERY, NIAGARA, ONONDAGA, ORLEANS, OTSEGO, PUTNAM, RENSSE-
   33  LAER, ROCKLAND, SCHOHARIE, SCHUYLER, SENECA, STEUBEN, SUFFOLK, SULLIVAN,
   34  TIOGA, TOMPKINS, ULSTER, WAYNE, WYOMING, YATES.
   35    (E) ONE AND ONE-QUARTER PERCENT - HERKIMER, NASSAU.
   36    (F) ONE AND ONE-HALF PERCENT - ALLEGANY.
   37    (G) ONE AND THREE-QUARTERS PERCENT - ERIE, ONEIDA.
   38    (2) CITIES:
   39    (A) ONE-QUARTER OF ONE PERCENT - NONE.
   40    (B) ONE-HALF OF ONE PERCENT - NONE.
   41    (C) THREE-QUARTERS OF ONE PERCENT - NONE.
   42    (D) ONE PERCENT - MOUNT VERNON, NEW ROCHELLE, WHITE PLAINS, YONKERS.
   43    (F) EACH OF THE FOLLOWING CITIES IS AUTHORIZED TO  PREEMPT  THE  TAXES
   44  IMPOSED  BY  THE COUNTY IN WHICH IT IS LOCATED PURSUANT TO THE AUTHORITY
   45  OF SUBDIVISION (A) OF SECTION TWELVE HUNDRED TEN OF THIS ARTICLE, TO THE
   46  EXTENT OF ONE-HALF THE MAXIMUM AGGREGATE RATE AUTHORIZED  UNDER  SECTION
   47  TWELVE  HUNDRED  TEN OF THIS ARTICLE, INCLUDING THE ADDITIONAL RATE THAT
   48  THE COUNTY IN WHICH SUCH  CITY  IS  LOCATED  IS  AUTHORIZED  TO  IMPOSE:
   49  AUBURN, IN CAYUGA COUNTY; CORTLAND, IN CORTLAND COUNTY; GLOVERSVILLE AND
   50  JOHNSTOWN,  IN  FULTON  COUNTY;  ONEIDA,  IN MADISON COUNTY; ONEONTA, IN
   51  OTSEGO COUNTY. AS OF THE DATE THIS SUBDIVISION TAKES  EFFECT,  ANY  SUCH
   52  PREEMPTION  BY SUCH A CITY IN EFFECT ON SUCH DATE SHALL CONTINUE IN FULL
   53  FORCE AND EFFECT UNTIL THE EFFECTIVE DATE OF A LOCAL LAW, ORDINANCE,  OR
   54  RESOLUTION  ADOPTED  OR  AMENDED  BY THE CITY TO CHANGE SUCH PREEMPTION,
   55  PROVIDED SUCH A CITY'S RATE OF TAX IN EXCESS OF ONE AND ONE-HALF PERCENT
   56  SHALL NOT CONTINUE IN EFFECT IF THE COUNTY IN WHICH IT IS  LOCATED  DOES
       S. 2609--A                         86                         A. 3009--A
    1  NOT  EXTEND  ITS  ADDITIONAL  RATE  IN  EXCESS  OF  THREE PERCENT.   ANY
    2  PREEMPTION BY SUCH A CITY TO TAKE EFFECT UNDER  THIS  SUBDIVISION  AFTER
    3  THE  DATE  THIS  SUBDIVISION TAKES EFFECT SHALL BE SUBJECT TO THE NOTICE
    4  REQUIREMENTS  IN SECTION TWELVE HUNDRED TWENTY-THREE OF THIS SUBPART AND
    5  TO THE OTHER REQUIREMENTS OF THIS ARTICLE.
    6    (G) NOTWITHSTANDING THE FOREGOING PROVISIONS OF THIS SECTION OR  OTHER
    7  LAW,  IF THE COUNTY OF DUTCHESS WITHDRAWS FROM THE METROPOLITAN COMMUTER
    8  TRANSPORTATION DISTRICT AND IMPOSES THE ADDITIONAL THREE-EIGHTHS PERCENT
    9  RATE OF TAX, THE NET COLLECTIONS FROM WHICH THE COUNTY HAS SET ASIDE FOR
   10  MASS TRANSPORTATION PURPOSES, AS AUTHORIZED BY SUBPARAGRAPH (IV) OF  THE
   11  OPENING  PARAGRAPH  OF  SECTION TWELVE HUNDRED TEN OF THIS ARTICLE, SUCH
   12  ADDITIONAL THREE-EIGHTHS PERCENT RATE OF TAX SHALL BE IN ADDITION TO ANY
   13  OTHER ADDITIONAL RATE OF TAX SUCH COUNTY IS  AUTHORIZED  TO  IMPOSE  AND
   14  SHALL  NOT  BE  SUBJECT  TO PREEMPTION AND SUCH COUNTY SHALL NOT INCLUDE
   15  SUCH ADDITIONAL THREE-EIGHTHS PERCENT RATE OF  TAX  IN  DETERMINING  ITS
   16  ADDITIONAL RATE OF TAX ON THE AREA OF THE COUNTY OUTSIDE ANY CITY IN THE
   17  COUNTY  IMPOSING  TAX  FOR PURPOSES OF SUBDIVISION (D) OF SECTION TWELVE
   18  HUNDRED SIXTY-TWO OF THIS ARTICLE.
   19    S 8. The tax law is amended  by  adding  three  new  sections  1262-t,
   20  1262-u, and 1262-v to read as follows:
   21    S  1262-T.  ONEIDA COUNTY NET COLLECTIONS FROM ADDITIONAL RATE OF TAX.
   22  NET COLLECTIONS FROM AN ADDITIONAL THREE-QUARTERS PERCENT RATE OF ONEIDA
   23  COUNTY'S SALES AND  COMPENSATING  USE  TAXES  IMPOSED  PURSUANT  TO  THE
   24  AUTHORITY  OF CLAUSE TWO OF SUBPARAGRAPH (I) OF THE OPENING PARAGRAPH OF
   25  SECTION TWELVE HUNDRED TEN OF THIS ARTICLE SHALL NOT BE SUBJECT  TO  ANY
   26  REVENUE DISTRIBUTION AGREEMENT ENTERED INTO BY THE COUNTY AND THE CITIES
   27  IN  THE COUNTY UNDER SUBDIVISION (C) OF SECTION TWELVE HUNDRED SIXTY-TWO
   28  OF THIS PART.
   29    S 1262-U. CLINTON COUNTY NET COLLECTIONS FROM ADDITIONAL RATE OF  TAX.
   30  NET  COLLECTIONS  FROM ANY ADDITIONAL RATE OF SALES AND COMPENSATING USE
   31  TAXES CLINTON COUNTY IMPOSES PURSUANT TO THE AUTHORITY OF CLAUSE TWO  OF
   32  SUBPARAGRAPH  (I) OF THE OPENING PARAGRAPH OF SECTION TWELVE HUNDRED TEN
   33  OF THIS ARTICLE SHALL BE PAID TO THE COUNTY AND  THE  COUNTY  SHALL  SET
   34  ASIDE SUCH NET COLLECTIONS AND USE THEM SOLELY FOR COUNTY PURPOSES. SUCH
   35  NET  COLLECTIONS SHALL NOT BE SUBJECT TO ANY REVENUE DISTRIBUTION AGREE-
   36  MENT ENTERED INTO BY THE COUNTY AND THE CITY IN THE COUNTY UNDER  SUBDI-
   37  VISION (C) OF SECTION TWELVE HUNDRED SIXTY-TWO OF THIS PART.
   38    S  1262-V. ONTARIO COUNTY NET COLLECTIONS FROM ADDITIONAL RATE OF TAX.
   39  NOTWITHSTANDING ANY LAW TO THE CONTRARY, AFTER ONTARIO COUNTY  ALLOCATES
   40  NET  COLLECTIONS  FROM  ITS ADDITIONAL ONE-EIGHTH OF ONE PERCENT RATE OF
   41  SALES AND COMPENSATING USE TAXES PURSUANT TO THE  AUTHORITY  OF  SECTION
   42  TWELVE HUNDRED SIXTY-TWO-R OF THIS PART, AS ADDED BY CHAPTER THIRTY-SEV-
   43  EN  OF  THE  LAWS OF TWO THOUSAND SIX, NET COLLECTIONS FROM THE COUNTY'S
   44  ADDITIONAL THREE-EIGHTHS OF ONE PERCENT RATE OF SUCH TAXES SHALL BE  SET
   45  ASIDE  FOR  COUNTY  PURPOSES  AND  SHALL NOT BE SUBJECT TO ANY AGREEMENT
   46  ENTERED INTO BY THE COUNTY AND THE CITIES IN THE COUNTY  UNDER  SUBDIVI-
   47  SION  (C)  OF SECTION TWELVE HUNDRED SIXTY-TWO OR SECTION TWELVE HUNDRED
   48  SIXTY-TWO-R OF THIS PART, AS ADDED BY CHAPTER THIRTY-SEVEN OF  THE  LAWS
   49  OF TWO THOUSAND SIX.
   50    S  9.  Section 1262-s of the tax law, as amended by chapter 226 of the
   51  laws of 2011, is amended to read as follows:
   52    S 1262-s. Disposition of net collections from the additional one-quar-
   53  ter of one percent rate of sales and compensating use taxes in the coun-
   54  ty of Herkimer. Notwithstanding any contrary provision of  law,  if  the
   55  county  of  Herkimer  imposes  the additional one-quarter of one percent
   56  rate of sales and compensating use  taxes  IN  EXCESS  OF  FOUR  PERCENT
       S. 2609--A                         87                         A. 3009--A
    1  authorized  by  [section  twelve hundred ten-E] THE OPENING PARAGRAPH OF
    2  SECTION TWELVE HUNDRED TEN of this article [for all or  any  portion  of
    3  the  period  beginning  December  first,  two  thousand seven and ending
    4  November thirtieth, two thousand thirteen], the county shall use all net
    5  collections  from such additional one-quarter of one percent rate to pay
    6  the county's expenses for the construction  of  additional  correctional
    7  facilities.  The net collections from [the] SUCH additional rate imposed
    8  [pursuant to section twelve hundred  ten-E]  shall  be  deposited  in  a
    9  special  fund  to  be created by such county separate and apart from any
   10  other funds and accounts of  the  county.  Any  and  all  remaining  net
   11  collections  from  such  additional  tax,  after  the  expenses  of such
   12  construction are paid, shall be deposited by the county of  Herkimer  in
   13  the general fund of such county for any county purpose.
   14    S  10.  The tax law is amended by adding a new section 1265 to read as
   15  follows:
   16    S 1265. REFERENCES TO CERTAIN PROVISIONS AUTHORIZING ADDITIONAL  RATES
   17  OR  TO  EXPIRATIONS OF A PERIOD. NOTWITHSTANDING ANY PROVISION OF LAW TO
   18  THE CONTRARY: ANY REFERENCE IN ANY SECTION OF THIS CHAPTER OR OTHER LAW,
   19  OR IN ANY LOCAL LAW, ORDINANCE, OR RESOLUTION ADOPTED  PURSUANT  TO  THE
   20  AUTHORITY  OF THIS ARTICLE, OR IN ANY AGREEMENT ENTERED INTO BY A COUNTY
   21  AND ALL THE CITIES IN THAT  COUNTY  UNDER  SUBDIVISION  (C)  OF  SECTION
   22  TWELVE  HUNDRED  SIXTY-TWO  OF THIS PART, TO NET COLLECTIONS OR REVENUES
   23  FROM A TAX IMPOSED BY A COUNTY OR CITY PURSUANT TO THE  AUTHORITY  OF  A
   24  CLAUSE,  OR  TO  A SUBCLAUSE OF A CLAUSE, OF SUBPARAGRAPH (I) OR (II) OF
   25  THE OPENING PARAGRAPH OF SECTION TWELVE  HUNDRED  TEN  OF  THIS  ARTICLE
   26  REPEALED  BY  SECTION ONE OR TWO OF THE CHAPTER OF THE LAWS OF TWO THOU-
   27  SAND THIRTEEN THAT ADDED THIS SECTION OR TO SECTION TWELVE HUNDRED TEN-E
   28  OF THIS ARTICLE REPEALED BY SECTION FIVE OF SUCH CHAPTER OF THE LAWS  OF
   29  TWO  THOUSAND  THIRTEEN  SHALL  BE  DEEMED  TO  BE  A  REFERENCE  TO NET
   30  COLLECTIONS OR REVENUES FROM A TAX IMPOSED BY THAT COUNTY OR CITY PURSU-
   31  ANT TO THE AUTHORITY OF  THE  EQUIVALENT  PROVISION  OF  CLAUSE  TWO  OF
   32  SUBPARAGRAPH  (I)  OR  TO  SUBPARAGRAPH (II) OF THE OPENING PARAGRAPH OF
   33  SUCH SECTION TWELVE HUNDRED TEN AS ADDED BY SUCH SECTION ONE OR  TWO  OF
   34  SUCH CHAPTER OF THE LAWS OF TWO THOUSAND THIRTEEN.
   35    S  11. Severability. If any provision of this act shall for any reason
   36  be finally adjudged by any court of competent jurisdiction to be  inval-
   37  id,  such judgment shall not affect, impair, or invalidate the remainder
   38  of this act, but shall be confined in its  operation  to  the  provision
   39  directly  involved  in the controversy in which such judgment shall have
   40  been rendered. It it hereby declared to be the intent of the legislature
   41  that this act would have been enacted even if such invalid provision had
   42  not been included in this act.
   43    S 12. This act shall take effect immediately.
   44                                   PART S
   45    Section 1. Paragraph 1 of subdivision a of section  1612  of  the  tax
   46  law,  as amended by chapter 147 of the laws of 2010, subparagraph (A) as
   47  amended by section 1 of part S of chapter 59 of the  laws  of  2012,  is
   48  amended to read as follows:
   49    (1) sixty percent of the total amount for which tickets have been sold
   50  for  [a  lawful lottery] THE QUICK DRAW game [introduced on or after the
   51  effective date of this paragraph,] subject to [the following provisions:
   52    (A) such game shall be available only on premises occupied by licensed
   53  lottery sales agents, subject to the following provisions:
       S. 2609--A                         88                         A. 3009--A
    1    (i) if the licensee does not hold a license  issued  pursuant  to  the
    2  alcoholic  beverage control law to sell alcoholic beverages for consump-
    3  tion on the premises, then the  premises  must  have  a  minimum  square
    4  footage greater than two thousand five hundred square feet;
    5    (ii)  notwithstanding  the  foregoing provisions, television equipment
    6  that  automatically  displays  the  results  of  such  drawings  may  be
    7  installed and used without regard to the square footage if such premises
    8  are used as:
    9    (I) a commercial bowling establishment, or
   10    (II)  a facility authorized under the racing, pari-mutuel wagering and
   11  breeding law to accept pari-mutuel wagers;
   12    (B) the] rules for the operation of such game [shall be] as prescribed
   13  by regulations promulgated and adopted by the division[, provided howev-
   14  er, that such rules shall provide that no person under the age of  twen-
   15  ty-one  may  participate in such games on the premises of a licensee who
   16  holds a license issued pursuant to the alcoholic beverage control law to
   17  sell alcoholic beverages for consumption on the premises; and, provided,
   18  further, that such regulations may be revised on an emergency basis  not
   19  later than ninety days after the enactment of this paragraph in order to
   20  conform such regulations to the requirements of this paragraph]; or
   21    S 2. This act shall take effect immediately.
   22                                   PART T
   23    Section  1. Clause (F) of subparagraph (ii) of paragraph 1 of subdivi-
   24  sion b of section 1612 of the tax law, as amended by section 6 of part K
   25  of chapter 57 of the laws of 2010, is amended to read as follows:
   26    (F) notwithstanding clauses (A), (B), (C), (D) and (E) of this subpar-
   27  agraph, when a vendor track, is located in Sullivan  county  and  within
   28  sixty  miles  from any gaming facility in a contiguous state such vendor
   29  fee shall, for a period of [five] SIX years commencing April first,  two
   30  thousand  eight,  be at a rate of forty-one percent of the total revenue
   31  wagered at the vendor track after payout for  prizes  pursuant  to  this
   32  chapter, after which time such rate shall be as for all tracks in clause
   33  (C) of this subparagraph.
   34    S  2.  This  act  shall take effect immediately and shall be deemed to
   35  have been in full force and effect on and after April 1, 2013.
   36                                   PART U
   37    Section 1. Paragraph (a) of subdivision  1  of  section  1003  of  the
   38  racing,  pari-mutuel  wagering and breeding law, as amended by section 1
   39  of part O of chapter 59 of the laws of  2012,  is  amended  to  read  as
   40  follows:
   41    (a)  Any  racing  association  or  corporation  or  regional off-track
   42  betting corporation, authorized to conduct  pari-mutuel  wagering  under
   43  this  chapter, desiring to display the simulcast of horse races on which
   44  pari-mutuel betting shall be permitted in the manner and subject to  the
   45  conditions  provided  for  in  this article may apply to the board for a
   46  license so to do. Applications for licenses shall be in such form as may
   47  be prescribed by the board and shall contain such information  or  other
   48  material  or  evidence  as  the  board  may require. No license shall be
   49  issued by the board authorizing the simulcast transmission of  thorough-
   50  bred  races  from  a  track  located in Suffolk county. The fee for such
   51  licenses shall be five hundred dollars per simulcast facility  per  year
   52  payable  by the licensee to the board for deposit into the general fund.
       S. 2609--A                         89                         A. 3009--A
    1  Except as provided herein, the board shall not approve  any  application
    2  to  conduct  simulcasting  into individual or group residences, homes or
    3  other areas for the purposes of or in connection with pari-mutuel wager-
    4  ing.  The board may approve simulcasting into residences, homes or other
    5  areas to be conducted jointly by one or more regional off-track  betting
    6  corporations and one or more of the following: a franchised corporation,
    7  thoroughbred racing corporation or a harness racing corporation or asso-
    8  ciation;  provided  (i) the simulcasting consists only of those races on
    9  which pari-mutuel betting is authorized by this chapter at one  or  more
   10  simulcast  facilities  for  each  of  the  contracting off-track betting
   11  corporations which shall include wagers made in accordance with  section
   12  one thousand fifteen, one thousand sixteen and one thousand seventeen of
   13  this  article;  provided  further  that the contract provisions or other
   14  simulcast arrangements for such simulcast  facility  shall  be  no  less
   15  favorable than those in effect on January first, two thousand five; (ii)
   16  that  each  off-track  betting  corporation having within its geographic
   17  boundaries such residences, homes or other areas technically capable  of
   18  receiving  the  simulcast signal shall be a contracting party; (iii) the
   19  distribution of revenues shall be subject to  contractual  agreement  of
   20  the  parties  except that statutory payments to non-contracting parties,
   21  if any, may not be reduced; provided, however, that  nothing  herein  to
   22  the  contrary  shall  prevent  a  track  from televising its races on an
   23  irregular basis primarily for promotional or marketing purposes as found
   24  by the board. For purposes of this paragraph, the provisions of  section
   25  one  thousand  thirteen  of  this article shall not apply. Any agreement
   26  authorizing an in-home simulcasting experiment commencing prior  to  May
   27  fifteenth,  nineteen  hundred  ninety-five,  may,  and all its terms, be
   28  extended [until June thirtieth, two thousand thirteen]; provided, howev-
   29  er, that any party to such agreement may elect to terminate such  agree-
   30  ment  upon  conveying written notice to all other parties of such agree-
   31  ment at least forty-five  days  prior  to  the  effective  date  of  the
   32  termination,  via  registered  mail. Any party to an agreement receiving
   33  such notice of an intent to terminate, may request the board to  mediate
   34  between  the parties new terms and conditions in a replacement agreement
   35  between the parties as will permit continuation of an in-home experiment
   36  [until June thirtieth, two  thousand  thirteen];  and  (iv)  no  in-home
   37  simulcasting  in  the  thoroughbred special betting district shall occur
   38  without the approval of the regional thoroughbred track.
   39    S 2. Subparagraph (iii) of paragraph d of  subdivision  3  of  section
   40  1007 of the racing, pari-mutuel wagering and breeding law, as amended by
   41  section  2  of  part  O of chapter 59 of the laws of 2012, is amended to
   42  read as follows:
   43    (iii) Of the sums retained by a receiving track located in Westchester
   44  county on races received from a franchised corporation, for  the  period
   45  commencing  January  first,  two  thousand eight [and continuing through
   46  June thirtieth, two thousand thirteen], the amount used exclusively  for
   47  purses to be awarded at races conducted by such receiving track shall be
   48  computed  as  follows: of the sums so retained, two and one-half percent
   49  of the total pools. Such amount shall be increased or decreased  in  the
   50  amount  of  fifty  percent of the difference in total commissions deter-
   51  mined by comparing the total commissions available  after  July  twenty-
   52  first,  nineteen hundred ninety-five to the total commissions that would
   53  have been available to such track prior to July  twenty-first,  nineteen
   54  hundred ninety-five.
   55    S 3. Section 1014 of the racing, pari-mutuel wagering and breeding law
   56  is REPEALED.
       S. 2609--A                         90                         A. 3009--A
    1    S 4. Subdivision 1 of section 1015 of the racing, pari-mutuel wagering
    2  and breeding law, as amended by section 4 of part O of chapter 59 of the
    3  laws of 2012, is amended to read as follows:
    4    1.  The  provisions  of  this section shall govern the simulcasting of
    5  races conducted at harness tracks located in another  state  or  country
    6  during  the  period  COMMENCING July first, nineteen hundred ninety-four
    7  [through June thirtieth, two  thousand  thirteen].  This  section  shall
    8  supersede all inconsistent provisions of this chapter.
    9    S  5.  The  opening  paragraph of subdivision 1 of section 1016 of the
   10  racing, pari-mutuel wagering and breeding law, as amended by  section  5
   11  of  part  O  of  chapter  59  of the laws of 2012, is amended to read as
   12  follows:
   13    The provisions of this section shall govern the simulcasting of  races
   14  conducted  at thoroughbred tracks located in another state or country on
   15  any day during which a franchised corporation is not conducting  a  race
   16  meeting  in  Saratoga  county  at Saratoga thoroughbred racetrack [until
   17  June thirtieth, two thousand thirteen]. Every off-track  betting  corpo-
   18  ration branch office and every simulcasting facility licensed in accord-
   19  ance  with  section  one thousand seven that have entered into a written
   20  agreement with such facility's representative horsemen's organization as
   21  approved by the board, one thousand eight or one thousand nine  of  this
   22  article  shall be authorized to accept wagers and display the live full-
   23  card simulcast signal of thoroughbred tracks (which may include  quarter
   24  horse  or  mixed  meetings provided that all such wagering on such races
   25  shall be construed to be thoroughbred races) located in another state or
   26  foreign country, subject to the following provisions; provided, however,
   27  no such written agreement shall be required of a franchised  corporation
   28  licensed in accordance with section one thousand seven of this article:
   29    S  6. The opening paragraph of section 1018 of the racing, pari-mutuel
   30  wagering and breeding law, as amended by section 6 of part O of  chapter
   31  59 of the laws of 2012, is amended to read as follows:
   32    Notwithstanding  any  other  provision of this chapter, for the period
   33  COMMENCING  July  twenty-fifth,  two  thousand  one  [through  September
   34  eighth,  two thousand twelve], when a franchised corporation is conduct-
   35  ing a race meeting within the state at Saratoga Race Course, every  off-
   36  track  betting corporation branch office and every simulcasting facility
   37  licensed in accordance with section one thousand seven (that has entered
   38  into a written agreement with such facility's representative  horsemen's
   39  organization  as approved by the board), one thousand eight or one thou-
   40  sand nine of this article shall  be  authorized  to  accept  wagers  and
   41  display  the  live  simulcast signal from thoroughbred tracks located in
   42  another state, provided that such facility shall accept wagers on  races
   43  run  at  all  in-state  thoroughbred  tracks which are conducting racing
   44  programs subject to the following provisions; provided, however, no such
   45  written agreement shall be required of a franchised corporation licensed
   46  in accordance with section one thousand seven of this article.
   47    S 7. Section 32 of chapter 281 of  the  laws  of  1994,  amending  the
   48  racing,  pari-mutuel  wagering and breeding law  and other laws relating
   49  to simulcasting, as amended by section 7 of part O of chapter 59 of  the
   50  laws of 2012, is amended to read as follows:
   51    S  32. This act shall take effect immediately [and the pari-mutuel tax
   52  reductions in section six  of  this  act  shall  expire  and  be  deemed
   53  repealed  on  July  1,  2013]; provided, however, that nothing contained
   54  herein shall be deemed to affect the application, qualification, expira-
   55  tion, or repeal of any provision of law amended by any section  of  this
   56  act,  and  such provisions shall be applied or qualified or shall expire
       S. 2609--A                         91                         A. 3009--A
    1  or be deemed repealed in the same manner, to the same extent and on  the
    2  same  date  as  the  case  may be as otherwise provided by law; provided
    3  further, however, that sections twenty-three and twenty-five of this act
    4  shall remain in full force and effect only until May 1, 1997 and at such
    5  time shall be deemed to be repealed.
    6    S  8.  Section  54  of  chapter  346 of the laws of 1990, amending the
    7  racing, pari-mutuel wagering and breeding law and other laws relating to
    8  simulcasting and the imposition of certain taxes, as amended by  section
    9  8  of  part  O  of chapter 59 of the laws of 2012, is amended to read as
   10  follows:
   11    S 54. This act  shall  take  effect  immediately;  provided,  however,
   12  sections  three  through twelve of this act shall take effect on January
   13  1, 1991, and [section 1013  of  the  racing,  pari-mutuel  wagering  and
   14  breeding law, as added by section thirty-eight of this act, shall expire
   15  and  be  deemed  repealed on July 1, 2013; and] section eighteen of this
   16  act shall take effect on July 1, 2008 and sections fifty-one and  fifty-
   17  two  of this act shall take effect as of the same date as chapter 772 of
   18  the laws of 1989 took effect.
   19    S 9. Paragraph (a) of subdivision 1 of  section  238  of  the  racing,
   20  pari-mutuel wagering and breeding law, as amended by section 9 of part O
   21  of chapter 59 of the laws of 2012, is amended to read as follows:
   22    (a)  The  franchised  corporation  authorized  under  this  chapter to
   23  conduct pari-mutuel betting at a race meeting or races run thereat shall
   24  distribute all sums deposited in any pari-mutuel pool to the holders  of
   25  winning  tickets therein, provided such tickets be presented for payment
   26  before April first of the year following the  year  of  their  purchase,
   27  less  an  amount  which  shall be established and retained by such fran-
   28  chised corporation of between twelve to  seventeen  per  centum  of  the
   29  total  deposits in pools resulting from on-track regular bets, and four-
   30  teen to twenty-one per centum of the total deposits in  pools  resulting
   31  from on-track multiple bets and fifteen to twenty-five per centum of the
   32  total  deposits in pools resulting from on-track exotic bets and fifteen
   33  to thirty-six per centum of the total deposits in pools  resulting  from
   34  on-track  super  exotic  bets, plus the breaks. The retention rate to be
   35  established is subject to the prior approval of the racing and  wagering
   36  board.  Such rate may not be changed more than once per calendar quarter
   37  to be effective on the first day of the calendar quarter. "Exotic  bets"
   38  and  "multiple  bets"  shall have the meanings set forth in section five
   39  hundred nineteen of this chapter.  "Super exotic bets"  shall  have  the
   40  meaning  set  forth  in  section  three hundred one of this chapter. For
   41  purposes of this section, a "pick six bet" shall mean a  single  bet  or
   42  wager on the outcomes of six races. The breaks are hereby defined as the
   43  odd  cents over any multiple of five for payoffs greater than one dollar
   44  five cents but less than five dollars, over  any  multiple  of  ten  for
   45  payoffs  greater  than  five  dollars but less than twenty-five dollars,
   46  over any multiple of twenty-five for payoffs  greater  than  twenty-five
   47  dollars but less than two hundred fifty dollars, or over any multiple of
   48  fifty  for  payoffs over two hundred fifty dollars. Out of the amount so
   49  retained there shall be paid  by  such  franchised  corporation  to  the
   50  commissioner  of  taxation and finance, as a reasonable tax by the state
   51  for the privilege of conducting pari-mutuel betting on the races run  at
   52  the  race  meetings  held  by such franchised corporation, the following
   53  percentages of the total pool for regular and  multiple  bets  five  per
   54  centum  of regular bets and four per centum of multiple bets plus twenty
   55  per centum of the breaks; for  exotic  wagers  seven  and  one-half  per
   56  centum  plus  twenty per centum of the breaks, and for super exotic bets
       S. 2609--A                         92                         A. 3009--A
    1  seven and one-half per centum plus fifty per centum of the  breaks.  For
    2  the  period  June  first, nineteen hundred ninety-five through September
    3  ninth, nineteen hundred ninety-nine, such tax on regular wagers shall be
    4  three  per  centum and such tax on multiple wagers shall be two and one-
    5  half per centum, plus twenty per centum of the breaks.  For  the  period
    6  September  tenth,  nineteen  hundred  ninety-nine  through March thirty-
    7  first, two thousand one, such tax on all wagers shall be  two  and  six-
    8  tenths  per  centum and for the period COMMENCING April first, two thou-
    9  sand one [through December thirty-first, two  thousand  thirteen],  such
   10  tax  on all wagers shall be one and six-tenths per centum, plus, in each
   11  such period, twenty per centum of the breaks. Payment to  the  New  York
   12  state  thoroughbred  breeding  and  development  fund by such franchised
   13  corporation shall be one-half of one per centum of total daily  on-track
   14  pari-mutuel  pools  resulting from regular, multiple and exotic bets and
   15  three per centum of super exotic bets provided, however,  that  for  the
   16  period September tenth, nineteen hundred ninety-nine through March thir-
   17  ty-first,  two thousand one, such payment shall be six-tenths of one per
   18  centum of regular, multiple and exotic pools and for the period COMMENC-
   19  ING April first, two thousand one [through  December  thirty-first,  two
   20  thousand thirteen], such payment shall be seven-tenths of one per centum
   21  of such pools.
   22    S  10. Subdivision 5 of section 1012 of the racing, pari-mutuel wager-
   23  ing and breeding law is REPEALED.
   24    S 11. This act shall take effect immediately.
   25                                   PART V
   26    Section 1. Subparagraphs (A) and (B) of paragraph 2 of subsection (pp)
   27  of section 606 of the tax law, as amended by chapter 472 of the laws  of
   28  2010, are amended to read as follows:
   29    (A) With respect to any particular residence of a taxpayer, the credit
   30  allowed  under  paragraph  one of this subsection shall not exceed fifty
   31  thousand dollars for taxable years beginning on or after January  first,
   32  two thousand ten and before January first, two thousand [fifteen] TWENTY
   33  and twenty-five thousand dollars for taxable years beginning on or after
   34  January  first, two thousand [fifteen] TWENTY.  In the case of a husband
   35  and wife, the amount of the credit shall be divided between them equally
   36  or in such other manner as they may both elect.  If  a  taxpayer  incurs
   37  qualified rehabilitation expenditures in relation to more than one resi-
   38  dence  in  the same year, the total amount of credit allowed under para-
   39  graph one of this subsection for all such expenditures shall not  exceed
   40  fifty  thousand  dollars for taxable years beginning on or after January
   41  first, two thousand ten and before January first, two thousand [fifteen]
   42  TWENTY and twenty-five thousand dollars for taxable years  beginning  on
   43  or after January first, two thousand [fifteen] TWENTY.
   44    (B)  For  taxable years beginning on or after January first, two thou-
   45  sand ten and before January first, two thousand [fifteen] TWENTY, if the
   46  amount of credit  allowable  under  this  subsection  shall  exceed  the
   47  taxpayer's tax for such year, and the taxpayer's New York adjusted gross
   48  income  for such year does not exceed sixty thousand dollars, the excess
   49  shall be treated as an overpayment of tax to be credited or refunded  in
   50  accordance with the provisions of section six hundred eighty-six of this
   51  article,  provided,  however, that no interest shall be paid thereon. If
   52  the taxpayer's New York adjusted gross  income  for  such  year  exceeds
   53  sixty  thousand  dollars,  the excess credit that may be carried over to
   54  the following year or years and may be deducted from the taxpayer's  tax
       S. 2609--A                         93                         A. 3009--A
    1  for  such year or years. For taxable years beginning on or after January
    2  first, two thousand [fifteen] TWENTY, if the amount of credit  allowable
    3  under this subsection shall exceed the taxpayer's tax for such year, the
    4  excess  may  be  carried  over to the following year or years and may be
    5  deducted from the taxpayer's tax for such year or years.
    6    S 2. This act shall take effect immediately.
    7    S 2. Severability clause. If any clause, sentence, paragraph, subdivi-
    8  sion, section or part of this act shall be  adjudged  by  any  court  of
    9  competent  jurisdiction  to  be invalid, such judgment shall not affect,
   10  impair, or invalidate the remainder thereof, but shall  be  confined  in
   11  its  operation  to the clause, sentence, paragraph, subdivision, section
   12  or part thereof directly involved in the controversy in which such judg-
   13  ment shall have been rendered. It is hereby declared to be the intent of
   14  the legislature that this act would  have  been  enacted  even  if  such
   15  invalid provisions had not been included herein.
   16    S  3.  This  act shall take effect immediately provided, however, that
   17  the applicable effective date of Parts A through V of this act shall  be
   18  as specifically set forth in the last section of such Parts.