Bill Text: NY A05394 | 2013-2014 | General Assembly | Introduced


Bill Title: Establishes the New York state cornerstone program and the New York state discovery program.

Spectrum: Partisan Bill (Republican 26-0)

Status: (Introduced - Dead) 2014-04-07 - held for consideration in ways and means [A05394 Detail]

Download: New_York-2013-A05394-Introduced.html
                           S T A T E   O F   N E W   Y O R K
       ________________________________________________________________________
                                         5394
                              2013-2014 Regular Sessions
                                 I N  A S S E M B L Y
                                   February 25, 2013
                                      ___________
       Introduced by M. of A. KOLB, BUTLER, REILICH, KATZ -- Multi-Sponsored by
         --  M.  of  A.  BARCLAY, BLANKENBUSH, CERETTO, CROUCH, CURRAN, DUPREY,
         FINCH, FITZPATRICK, GIGLIO,  GOODELL,  GRAF,  HAWLEY,  JOHNS,  JORDAN,
         LOSQUADRO,  McKEVITT, McLAUGHLIN, MONTESANO, OAKS, PALMESANO, RABBITT,
         RAIA, SALADINO, TEDISCO, TENNEY --  read  once  and  referred  to  the
         Committee on Ways and Means
       AN  ACT  to amend the general municipal law, in relation to establishing
         the New York state cornerstone program; and to repeal article 18-B  of
         such law relating thereto (Part A); to amend the general municipal law
         and  the  tax  law,  in  relation  to  establishing the New York state
         discovery program (Part B); and to amend the tax law, in  relation  to
         net income base and in relation to certain taxes (Part C)
         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 components of legislation relating
    2  to the "New York state  cornerstone  program  and  the  New  York  state
    3  discovery  program".  Each  component  is wholly contained within a Part
    4  identified as Parts A through C. 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 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    S 1-a. Statement of legislative findings and declaration.  It is here-
   13  by  found and declared that there exists within the state high unemploy-
   14  ment, limited new  job  creation,  a  dependence  on  public  assistance
   15  income,  insufficient  support for industrial and commercial businesses,
   16  and unnecessarily high taxes.  These  severe  conditions  require  state
   17  government  to  target  certain industries in order to stimulate private
        EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                             [ ] is old law to be omitted.
                                                                  LBD06260-01-3
       A. 5394                             2
    1  investment, private business development and job creation. It should  be
    2  the  public  policy  of the state to help promote the development of new
    3  businesses, rather than deter them with punitive regulation  and  exces-
    4  sive taxes. It is further found and declared that it is the public poli-
    5  cy of the state to achieve these goals through the mutual cooperation of
    6  all  levels  of  state  and local government, the business community and
    7  academic institutions.
    8                                   PART A
    9    Section 1. Article 18-B of the general municipal law is REPEALED.
   10    S 2. The general municipal law is amended by adding a new article 18-B
   11  to read as follows:
   12                                 ARTICLE 18-B
   13                     NEW YORK STATE CORNERSTONE PROGRAM
   14  SECTION 955. NEW YORK CORNERSTONE PROGRAM ESTABLISHED.
   15          956. RESPONSIBILITIES OF THE COMMISSIONER.
   16          957. CORNERSTONE DEVELOPMENT BOARD.
   17          958. REPORTING REQUIREMENTS.
   18    S 955. NEW YORK  CORNERSTONE  PROGRAM  ESTABLISHED.  THERE  IS  HEREBY
   19  ESTABLISHED THE NEW YORK CORNERSTONE PROGRAM.
   20    S  956.  RESPONSIBILITIES  OF THE COMMISSIONER. 1. THE COMMISSIONER OF
   21  ECONOMIC DEVELOPMENT SHALL, IN CONSULTATION WITH  THE  DIRECTOR  OF  THE
   22  BUDGET,  THE COMMISSIONER OF LABOR, AND THE COMMISSIONER OF TAXATION AND
   23  FINANCE, PROMULGATE RULES AND REGULATIONS,  WHICH,  NOTWITHSTANDING  ANY
   24  PROVISIONS  TO  THE  CONTRARY IN THE STATE ADMINISTRATIVE PROCEDURE ACT,
   25  MAY BE ADOPTED ON AN EMERGENCY BASIS, RELATING TO:
   26    (A) THE APPLICATION PROCESS;
   27    (B) DEFINING TYPES OF BUSINESSES ELIGIBLE, INCLUDING BUT  NOT  LIMITED
   28  TO MANUFACTURING, HIGH-TECH, BIO-TECH, CLEAN-TECH AND AGRI-BUSINESS;
   29    (C) LIMITING BUSINESSES TO TEN YEARS OF PARTICIPATION;
   30    (D)  CERTIFICATION  BY  THE  COMMISSIONER  FOR ELIGIBILITY OF BUSINESS
   31  ENTERPRISES FOR BENEFITS REFERRED  TO  IN  THIS  ARTICLE.  CRITERIA  FOR
   32  CERTIFICATION SHALL INCLUDE, BUT NOT BE LIMITED TO:
   33    (I)  REQUIRING  A  BUSINESS TO HAVE BEEN OPERATIONAL IN NEW YORK STATE
   34  FOR AT LEAST TEN CONSECUTIVE YEARS PRIOR TO APPLYING TO THE  CORNERSTONE
   35  PROGRAM;
   36    (II)  REQUIRING  A BUSINESS TO SHOW PROOF THAT THEY WILL HAVE TO LOWER
   37  EMPLOYMENT LEVELS WITHOUT CERTIFICATION IN THE PROGRAM;
   38    (III) REQUIRING A BUSINESS TO  COMMIT  TO  MAINTAINING  OR  INCREASING
   39  CURRENT EMPLOYMENT LEVELS TO QUALIFY FOR TAX BENEFITS;
   40    (IV)  WHETHER  CERTIFICATION WILL HAVE THE UNDESIRED EFFECT OF CAUSING
   41  INDIVIDUALS TO TRANSFER FROM EXISTING EMPLOYMENT WITH  ANOTHER  BUSINESS
   42  ENTERPRISE  TO SIMILAR EMPLOYMENT WITH THE BUSINESS ENTERPRISE SO CERTI-
   43  FIED, AND TRANSFERRING EXISTING EMPLOYMENT FROM ONE OR MORE OTHER  MUNI-
   44  CIPALITIES, TOWNS OR VILLAGES IN THE STATE;
   45    (V)  WHETHER SUCH ENTERPRISE IS LIKELY TO ENHANCE THE ECONOMIC CLIMATE
   46  OF THE STATE; AND
   47    (VI) WHETHER THE COMMISSIONER OF LABOR ESTABLISHES THAT SUCH  BUSINESS
   48  ENTERPRISE, DURING THE TEN YEARS PRECEDING THE SUBMISSION OF AN APPLICA-
   49  TION  FOR  CERTIFICATION,  HAS  ENGAGED  IN A SUBSTANTIAL VIOLATION OR A
   50  PATTERN OF VIOLATIONS OF LAWS REGULATING UNEMPLOYMENT INSURANCE, WORKERS
   51  COMPENSATION, PUBLIC WORK, CHILD LABOR,  EMPLOYMENT  OF  MINORITIES  AND
   52  WOMEN, SAFETY AND HEALTH, OR OTHER LAWS FOR THE PROTECTION OF WORKERS AS
   53  DETERMINED BY FINAL JUDGMENT OF A JUDICIAL OR ADMINISTRATIVE PROCEEDING.
       A. 5394                             3
    1    2.  THE  COMMISSIONER  OF  ECONOMIC DEVELOPMENT SHALL, IN CONSULTATION
    2  WITH THE DIRECTOR OF THE BUDGET, THE  COMMISSIONER  OF  LABOR,  AND  THE
    3  COMMISSIONER OF TAXATION AND FINANCE, ESTABLISH A COST BENEFIT ANALYSIS.
    4    3.  THE  COMMISSIONER  OF  ECONOMIC DEVELOPMENT SHALL, IN CONSULTATION
    5  WITH THE DIRECTOR OF THE BUDGET, THE  COMMISSIONER  OF  LABOR,  AND  THE
    6  COMMISSIONER  OF  TAXATION  AND FINANCE, ESTABLISH A PROGRAM AND PROPOSE
    7  LEGISLATION GRANTING TAX  EXEMPTIONS  PREVIOUSLY  APPLICABLE  TO  EMPIRE
    8  ZONES  FOR  BUSINESS  ENTERPRISES ELIGIBLE UNDER THE CORNERSTONE PROGRAM
    9  ESTABLISHED PURSUANT TO THIS ARTICLE, TO THE  GOVERNOR  AND  LEGISLATURE
   10  WITHIN ONE HUNDRED EIGHTY DAYS FROM THE EFFECTIVE DATE OF THIS ARTICLE.
   11    S  957. CORNERSTONE DEVELOPMENT BOARD.  1. THE CORNERSTONE DEVELOPMENT
   12  BOARD IS HEREBY CREATED.
   13    2. SUCH BOARD SHALL  CONSIST  OF  THE  COMMISSIONER  OF  TAXATION  AND
   14  FINANCE,  THE  DIRECTOR OF THE BUDGET, THE COMMISSIONER OF LABOR AND TWO
   15  MEMBERS TO BE APPOINTED BY THE GOVERNOR; ONE MEMBER TO BE  APPOINTED  BY
   16  THE TEMPORARY PRESIDENT OF THE SENATE; ONE MEMBER TO BE APPOINTED BY THE
   17  SPEAKER  OF  THE  ASSEMBLY;  ONE  MEMBER TO BE APPOINTED BY THE MINORITY
   18  LEADER OF THE SENATE AND ONE MEMBER TO  BE  APPOINTED  BY  THE  MINORITY
   19  LEADER OF THE ASSEMBLY.
   20    3.  THE  GOVERNOR  SHALL  DESIGNATE  FROM AMONG THE VOTING MEMBERS THE
   21  CHAIR OF THE BOARD. EACH MEMBER OF THE BOARD SHALL BE ENTITLED TO DESIG-
   22  NATE A REPRESENTATIVE TO ATTEND MEETINGS OF THE  BOARD  IN  HIS  OR  HER
   23  PLACE,  AND  TO VOTE OR OTHERWISE ACT ON HIS OR HER BEHALF IN HIS OR HER
   24  ABSENCE.
   25    4. NOTICE OF SUCH DESIGNATION SHALL BE FURNISHED  IN  WRITING  TO  THE
   26  BOARD BY THE DESIGNATING MEMBER.
   27    5.  A  REPRESENTATIVE  SHALL  SERVE AT THE PLEASURE OF THE DESIGNATING
   28  MEMBER.
   29    6. A REPRESENTATIVE SHALL NOT BE AUTHORIZED TO DELEGATE ANY OF HIS  OR
   30  HER DUTIES OR FUNCTIONS TO ANY OTHER PERSON.
   31    S  958.  REPORTING  REQUIREMENTS.    1.  THE  DEPARTMENT  OF AUDIT AND
   32  CONTROL, THE DEPARTMENT OF TAXATION AND FINANCE AND  THE  DEPARTMENT  OF
   33  ECONOMIC  DEVELOPMENT  SHALL  PREPARE  REPORTS ON THE MANAGEMENT AND THE
   34  ECONOMIC AND FISCAL IMPACT OF THE CORNERSTONE PROGRAM.
   35    2. THE ANALYSIS OF THE FISCAL AND ECONOMIC IMPACT OF THE PROGRAM SHALL
   36  INCLUDE, BUT NOT BE LIMITED TO: A REVIEW OF THE COST  OF  PROVIDING  THE
   37  TAX  BENEFITS  REFERRED  TO  IN  THIS  ARTICLE; PROGRESS OF THE PROGRAM;
   38  NUMBER OF TAX CREDITS CLAIMED BY EACH CERTIFIED BUSINESS; NUMBER OF JOBS
   39  CREATED AND/OR RETAINED BY  EACH  BUSINESS  AND  ALL  OTHER  INFORMATION
   40  REQUESTED AND NOT PROHIBITED BY LAW.
   41    3.  SUCH REPORTS SHALL BE TRANSMITTED TO THE GOVERNOR AND THE LEGISLA-
   42  TURE BY SEPTEMBER FIRST, TWO THOUSAND THIRTEEN AND EVERY YEAR THEREAFTER
   43  AND SHALL BE POSTED ONLINE FOR FULL PUBLIC DISCLOSURE.
   44    S 3. This act shall take effect immediately; provided,  however,  that
   45  any  rules and regulations necessary to carry out the provisions of this
   46  act shall be promulgated before such effective date.
   47                                   PART B
   48    Section 1. This act shall be known and may be cited as the  "New  York
   49  state discovery act".
   50    S  2.    The  general municipal law is amended by adding a new article
   51  18-D to read as follows:
   52                                 ARTICLE 18-D
   53                      NEW YORK STATE DISCOVERY PROGRAM
   54  SECTION 972. NEW YORK STATE DISCOVERY PROGRAM.
       A. 5394                             4
    1          973. JOB DEVELOPMENT FUND.
    2    S 972. NEW YORK STATE DISCOVERY PROGRAM. 1. THE NEW YORK STATE DISCOV-
    3  ERY PROGRAM IS HEREBY ESTABLISHED.
    4    2.  THE COMMISSIONER OF ECONOMIC DEVELOPMENT SHALL, AFTER CONSULTATION
    5  WITH THE DIRECTOR OF THE BUDGET, THE  COMMISSIONER  OF  LABOR,  AND  THE
    6  COMMISSIONER  OF TAXATION AND FINANCE, PROMULGATE RULES AND REGULATIONS,
    7  WHICH, NOTWITHSTANDING ANY PROVISIONS  TO  THE  CONTRARY  IN  THE  STATE
    8  ADMINISTRATIVE  PROCEDURE  ACT,  MAY  BE  ADOPTED ON AN EMERGENCY BASIS,
    9  RELATING TO:
   10    (A) THE APPLICATION PROCESS;
   11    (B) DEFINING TYPES OF BUSINESSES ELIGIBLE, INCLUDING BUT  NOT  LIMITED
   12  TO MANUFACTURING, HIGH-TECH, BIO-TECH, CLEAN-TECH AND AGRI-BUSINESS;
   13    (C) LIMITING BUSINESSES TO TEN YEARS OF PARTICIPATION;
   14    (D)  CERTIFICATION  BY  THE COMMISSIONER OF ECONOMIC DEVELOPMENT AS TO
   15  THE ELIGIBILITY OF BUSINESS ENTERPRISES FOR BENEFITS REFERRED TO IN THIS
   16  SECTION, WHICH SHALL BE GOVERNED BY CRITERIA INCLUDING, BUT NOT  LIMITED
   17  TO:
   18    (I)  REQUIRING  AN  ELIGIBLE  BUSINESS TO BE A START-UP BUSINESS, OR A
   19  BUSINESS OPERATING IN THE STATE FOR TWO YEARS OR LESS;
   20    (II) A BUSINESS MUST OFFER INTERNSHIPS TO LOCAL HIGH SCHOOL  STUDENTS,
   21  BOCES  STUDENTS AND COLLEGE STUDENTS PER A PLAN DEVELOPED BY THE COMMIS-
   22  SIONER OF ECONOMIC DEVELOPMENT;
   23    (III) A BUSINESS MUST COMMIT TO INCREASING CURRENT  EMPLOYMENT  LEVELS
   24  TO QUALIFY FOR TAX BENEFITS;
   25    (IV)  WHETHER  CERTIFICATION WILL HAVE THE UNDESIRED EFFECT OF CAUSING
   26  INDIVIDUALS TO TRANSFER FROM EXISTING EMPLOYMENT WITH  ANOTHER  BUSINESS
   27  ENTERPRISE  TO SIMILAR EMPLOYMENT WITH THE BUSINESS ENTERPRISE SO CERTI-
   28  FIED, AND TRANSFERRING EXISTING EMPLOYMENT FROM ONE OR MORE OTHER  MUNI-
   29  CIPALITIES, TOWNS OR VILLAGES IN THE STATE;
   30    (V)  WHETHER SUCH ENTERPRISE IS LIKELY TO ENHANCE THE ECONOMIC CLIMATE
   31  OF THE STATE;
   32    (VI) WHETHER THE COMMISSIONER OF LABOR ESTABLISHES THAT SUCH  BUSINESS
   33  ENTERPRISE, DURING THE TWO YEARS PRECEDING THE SUBMISSION OF AN APPLICA-
   34  TION  FOR  CERTIFICATION,  HAS  ENGAGED  IN A SUBSTANTIAL VIOLATION OR A
   35  PATTERN OF VIOLATIONS OF LAWS REGULATING UNEMPLOYMENT INSURANCE, WORKERS
   36  COMPENSATION, PUBLIC WORK, CHILD LABOR,  EMPLOYMENT  OF  MINORITIES  AND
   37  WOMEN, SAFETY AND HEALTH, OR OTHER LAWS FOR THE PROTECTION OF WORKERS AS
   38  DETERMINED BY FINAL JUDGMENT OF A JUDICIAL OR ADMINISTRATIVE PROCEEDING;
   39  AND
   40    (VII) WHETHER SUCH BUSINESS MEETS THE REQUIREMENTS OF THE COST BENEFIT
   41  ANALYSIS AS ESTABLISHED BY THE COMMISSIONER OF ECONOMIC DEVELOPMENT.
   42    3. THE DEPARTMENT OF AUDIT AND CONTROL, THE DEPARTMENT OF TAXATION AND
   43  FINANCE AND THE DEPARTMENT OF ECONOMIC DEVELOPMENT SHALL PREPARE REPORTS
   44  ON  THE  MANAGEMENT  AND THE ECONOMIC AND FISCAL IMPACT OF THE DISCOVERY
   45  PROGRAM. THE ANALYSIS OF THE FISCAL AND ECONOMIC IMPACT OF  THE  PROGRAM
   46  SHALL  INCLUDE, BUT NOT BE LIMITED TO: A REVIEW OF THE COST OF PROVIDING
   47  THE TAX BENEFITS REFERRED TO IN THIS ARTICLE; PROGRESS OF  THE  PROGRAM;
   48  NUMBER OF TAX CREDITS CLAIMED BY EACH CERTIFIED BUSINESS; NUMBER OF JOBS
   49  CREATED  BY  EACH  BUSINESS  AND ALL OTHER INFORMATION REQUESTED AND NOT
   50  PROHIBITED BY LAW. SUCH REPORTS SHALL BE TRANSMITTED TO THE GOVERNOR AND
   51  THE LEGISLATURE BY SEPTEMBER FIRST, TWO THOUSAND THIRTEEN AND EVERY YEAR
   52  THEREAFTER AND SHALL BE POSTED ONLINE FOR FULL PUBLIC DISCLOSURE.
   53    4. THE DEPARTMENT OF ECONOMIC DEVELOPMENT SHALL PROVIDE GRANTS  OF  UP
   54  TO  TWO  THOUSAND  DOLLARS  FOR  EVERY  INTERNSHIP  DEVELOPED UNDER THIS
   55  PROGRAM, TO BE PAID FOR OUT OF  THE  JOB  DEVELOPMENT  FUND  ESTABLISHED
   56  PURSUANT TO THIS ARTICLE. SUCH GRANT ALLOCATIONS SHALL BE DIVIDED EVENLY
       A. 5394                             5
    1  BETWEEN  THE  CERTIFIED  BUSINESS  AND  THE CORRESPONDING INSTITUTION OF
    2  HIGHER EDUCATION TO COVER COSTS ASSOCIATED WITH THE DEVELOPMENT OF  SUCH
    3  INTERNSHIPS.
    4    S  973. JOB DEVELOPMENT FUND. THERE IS HEREBY ESTABLISHED IN THE JOINT
    5  CUSTODY OF THE COMMISSIONER OF TAXATION AND FINANCE AND THE STATE  COMP-
    6  TROLLER A FUND TO BE KNOWN AS THE "JOB DEVELOPMENT FUND".
    7    2.  THE  FUND SHALL CONSIST OF MONIES APPROPRIATED FOR THE DIVISION OF
    8  SCIENCE, TECHNOLOGY AND INNOVATION.
    9    3. MONEYS OF THE FUND SHALL BE EXPENDED FOR THE PURPOSES  OF  CARRYING
   10  OUT  THE PROVISIONS OF SECTION NINE HUNDRED SEVENTY-TWO OF THIS ARTICLE.
   11  MONEYS SHALL BE PAID OUT OF THE FUND ON THE AUDIT  AND  WARRANT  OF  THE
   12  STATE COMPTROLLER ON VOUCHERS APPROVED BY THE DIVISION OF SCIENCE, TECH-
   13  NOLOGY  AND  INNOVATION.  ANY  INTEREST  RECEIVED  BY THE COMPTROLLER ON
   14  MONEYS ON DEPOSIT IN THE JOB DEVELOPMENT FUND SHALL BE RETAINED  IN  AND
   15  BECOME PART OF SUCH FUND.
   16    S  3.  The  tax law is amended by adding a new section 15-a to read as
   17  follows:
   18    S 15-A. DISCOVERY ZONE PROPERTY TAX CREDIT. FOR A BUSINESS  ENTERPRISE
   19  WHICH  IS  FIRST CERTIFIED UNDER SECTION NINE HUNDRED SEVENTY-TWO OF THE
   20  GENERAL MUNICIPAL LAW ON OR AFTER JULY FIRST, TWO THOUSAND THIRTEEN, THE
   21  CREDIT SHALL BE FOR A PERIOD OF TEN YEARS AND SHALL  NOT  EXCEED  THIRTY
   22  PERCENT  OF THE ELIGIBLE REAL PROPERTY TAXES PAID IN THE CURRENT TAXABLE
   23  YEAR OF ELIGIBILITY.
   24    S 4. Section 210 of the tax law is amended by adding two new  subdivi-
   25  sions 46 and 47 to read as follows:
   26    46.  DISCOVERY  INVESTMENT  CREDIT.  (A) A TAXPAYER SHALL BE ALLOWED A
   27  CREDIT, TO BE COMPUTED AS HEREINAFTER PROVIDED, AGAINST THE TAX  IMPOSED
   28  BY  THIS  ARTICLE  WHERE  THE  TAXPAYER  HAS  BEEN CERTIFIED PURSUANT TO
   29  SECTION NINE HUNDRED SEVENTY-TWO OF THE  GENERAL  MUNICIPAL  LAW.    THE
   30  AMOUNT OF SUCH CREDIT SHALL BE TWENTY PERCENT OF THE COST OR OTHER BASIS
   31  FOR  FEDERAL INCOME TAX PURPOSES OF TANGIBLE PERSONAL PROPERTY AND OTHER
   32  TANGIBLE PROPERTY, INCLUDING  BUILDINGS  AND  STRUCTURAL  COMPONENTS  OF
   33  BUILDINGS,  DESCRIBED  IN PARAGRAPH (B) OF THIS SUBDIVISION, BUT ONLY IF
   34  THE ACQUISITION, CONSTRUCTION, RECONSTRUCTION OR ERECTION OF SUCH  PROP-
   35  ERTY  OCCURRED OR WAS COMMENCED ON OR AFTER THE DATE OF SUCH DESIGNATION
   36  AND PRIOR TO THE EXPIRATION THEREOF. PROVIDED, HOWEVER, THAT IN THE CASE
   37  OF AN ACQUISITION, CONSTRUCTION, RECONSTRUCTION OR  ERECTION  WHICH  WAS
   38  COMMENCED  DURING  SUCH  PERIOD AND CONTINUED OR COMPLETED SUBSEQUENTLY,
   39  THE CREDIT SHALL BE TWENTY PERCENT OF THE PORTION OF THE COST  OR  OTHER
   40  BASIS FOR FEDERAL INCOME TAX PURPOSES ATTRIBUTABLE TO SUCH PERIOD, WHICH
   41  PORTION  SHALL  BE  ASCERTAINED  BY  MULTIPLYING SUCH COST OR BASIS BY A
   42  FRACTION THE NUMERATOR OF  WHICH  SHALL  BE  THE  EXPENDITURES  PAID  OR
   43  INCURRED  DURING  SUCH  PERIOD  FOR SUCH PURPOSES AND THE DENOMINATOR OF
   44  WHICH SHALL BE THE TOTAL OF ALL EXPENDITURES PAID OR INCURRED  FOR  SUCH
   45  ACQUISITION, CONSTRUCTION, RECONSTRUCTION OR ERECTION.
   46    (B)  A  CREDIT SHALL BE ALLOWED UNDER THIS SUBDIVISION WITH RESPECT TO
   47  TANGIBLE PERSONAL PROPERTY AND OTHER TANGIBLE PROPERTY, INCLUDING BUILD-
   48  INGS AND STRUCTURAL COMPONENTS OF BUILDINGS WHICH: (1)  ARE  DEPRECIABLE
   49  PURSUANT  TO  SECTION  ONE  HUNDRED  SIXTY-SEVEN OF THE INTERNAL REVENUE
   50  CODE, (2) HAVE A USEFUL LIFE OF FOUR YEARS OR MORE, (3) ARE ACQUIRED  BY
   51  PURCHASE  AS  DEFINED  IN  SECTION  ONE  HUNDRED SEVENTY-NINE (D) OF THE
   52  INTERNAL REVENUE CODE, AND (4) ARE (I) PRINCIPALLY USED BY THE  TAXPAYER
   53  IN  THE  PRODUCTION  OF  GOODS BY MANUFACTURING, PROCESSING, ASSEMBLING,
   54  REFINING, MINING, EXTRACTING, FARMING, AGRICULTURE, HORTICULTURE, FLORI-
   55  CULTURE, VITICULTURE OR COMMERCIAL FISHING, (II) INDUSTRIAL WASTE TREAT-
   56  MENT FACILITIES OR AIR POLLUTION CONTROL FACILITIES USED IN THE  TAXPAY-
       A. 5394                             6
    1  ER'S  TRADE  OR  BUSINESS, (III) RESEARCH AND DEVELOPMENT PROPERTY, (IV)
    2  PRINCIPALLY USED IN THE ORDINARY COURSE OF THE TAXPAYER'S TRADE OR BUSI-
    3  NESS AS A BROKER OR DEALER IN  CONNECTION  WITH  THE  PURCHASE  OR  SALE
    4  (WHICH  SHALL INCLUDE BUT NOT BE LIMITED TO THE ISSUANCE, ENTERING INTO,
    5  ASSUMPTION, OFFSET, ASSIGNMENT, TERMINATION,  OR  TRANSFER)  OF  STOCKS,
    6  BONDS   OR   OTHER   SECURITIES  AS  DEFINED  IN  SECTION  FOUR  HUNDRED
    7  SEVENTY-FIVE (C)(2) OF THE INTERNAL REVENUE CODE, OR OF  COMMODITIES  AS
    8  DEFINED IN SECTION FOUR HUNDRED SEVENTY-FIVE (E) OF THE INTERNAL REVENUE
    9  CODE,  OR  (V) PRINCIPALLY USED IN THE ORDINARY COURSE OF THE TAXPAYER'S
   10  TRADE OR BUSINESS OF PROVIDING INVESTMENT ADVISORY SERVICES FOR A  REGU-
   11  LATED  INVESTMENT  COMPANY AS DEFINED IN SECTION EIGHT HUNDRED FIFTY-ONE
   12  OF THE INTERNAL REVENUE CODE, OR LENDING, LOAN ARRANGEMENT OR LOAN ORIG-
   13  INATION SERVICES TO CUSTOMERS IN CONNECTION WITH THE  PURCHASE  OR  SALE
   14  (WHICH  SHALL INCLUDE BUT NOT BE LIMITED TO THE ISSUANCE, ENTERING INTO,
   15  ASSUMPTION, OFFSET, ASSIGNMENT, TERMINATION, OR TRANSFER) OF  SECURITIES
   16  AS  DEFINED  IN SECTION FOUR HUNDRED SEVENTY-FIVE (C)(2) OF THE INTERNAL
   17  REVENUE CODE. FOR PURPOSES OF CLAUSES (IV) AND (V) OF THIS SUBPARAGRAPH,
   18  PROPERTY PURCHASED BY A TAXPAYER AFFILIATED  WITH  A  REGULATED  BROKER,
   19  DEALER  OR  REGISTERED INVESTMENT ADVISER IS ALLOWED A CREDIT UNDER THIS
   20  SUBDIVISION IF THE PROPERTY IS USED BY ITS AFFILIATED REGULATED  BROKER,
   21  DEALER OR REGISTERED INVESTMENT ADVISER IN ACCORDANCE WITH THIS SUBDIVI-
   22  SION. FOR PURPOSES OF DETERMINING IF THE PROPERTY IS PRINCIPALLY USED IN
   23  QUALIFYING  USES, THE USES BY THE TAXPAYER DESCRIBED IN CLAUSES (IV) AND
   24  (V) OF THIS SUBPARAGRAPH MAY BE AGGREGATED. IN ADDITION, THE USES BY THE
   25  TAXPAYER,  ITS  AFFILIATED  REGULATED  BROKER,  DEALER,  AND  REGISTERED
   26  INVESTMENT  ADVISER  UNDER EITHER OR BOTH OF THOSE CLAUSES MAY BE AGGRE-
   27  GATED. PROVIDED, HOWEVER, A TAXPAYER SHALL NOT  BE  ALLOWED  THE  CREDIT
   28  PROVIDED  BY CLAUSES (IV) AND (V) OF THIS SUBPARAGRAPH UNLESS (I) EIGHTY
   29  PERCENT OR MORE OF  THE  EMPLOYEES  PERFORMING  THE  ADMINISTRATIVE  AND
   30  SUPPORT  FUNCTIONS  RESULTING  FROM OR RELATED TO THE QUALIFYING USES OF
   31  SUCH EQUIPMENT ARE LOCATED IN THIS STATE, OR (II) THE AVERAGE NUMBER  OF
   32  EMPLOYEES  THAT PERFORM THE ADMINISTRATIVE AND SUPPORT FUNCTIONS RESULT-
   33  ING FROM OR RELATED TO THE QUALIFYING USES OF  SUCH  EQUIPMENT  AND  ARE
   34  LOCATED  IN  THIS  STATE DURING THE TAXABLE YEAR FOR WHICH THE CREDIT IS
   35  CLAIMED IS EQUAL TO OR GREATER THAN NINETY-FIVE PERCENT OF  THE  AVERAGE
   36  NUMBER OF EMPLOYEES THAT PERFORM THESE FUNCTIONS AND ARE LOCATED IN THIS
   37  STATE  DURING  THE  THIRTY-SIX MONTHS IMMEDIATELY PRECEDING THE YEAR FOR
   38  WHICH THE CREDIT IS CLAIMED, OR (III) THE NUMBER OF EMPLOYEES LOCATED IN
   39  THIS STATE DURING THE TAXABLE YEAR FOR WHICH THE CREDIT  IS  CLAIMED  IS
   40  EQUAL  TO  OR  GREATER  THAN  NINETY  PERCENT OF THE NUMBER OF EMPLOYEES
   41  LOCATED IN THIS STATE ON DECEMBER THIRTY-FIRST, NINETEEN  HUNDRED  NINE-
   42  TY-EIGHT  OR,  IF THE TAXPAYER WAS NOT A CALENDAR YEAR TAXPAYER IN NINE-
   43  TEEN HUNDRED NINETY-EIGHT, THE LAST DAY OF ITS FIRST TAXABLE YEAR ENDING
   44  AFTER DECEMBER  THIRTY-FIRST,  NINETEEN  HUNDRED  NINETY-EIGHT.  IF  THE
   45  TAXPAYER  BECOMES  SUBJECT  TO  TAX IN THIS STATE AFTER THE TAXABLE YEAR
   46  BEGINNING IN NINETEEN HUNDRED NINETY-EIGHT, THEN  THE  TAXPAYER  IS  NOT
   47  REQUIRED  TO  SATISFY  THE  EMPLOYMENT  TEST  PROVIDED  IN THE PRECEDING
   48  SENTENCE OF THIS SUBPARAGRAPH FOR ITS FIRST TAXABLE YEAR.  FOR  PURPOSES
   49  OF  ITEM  (III) OF THIS CLAUSE, THE EMPLOYMENT TEST WILL BE BASED ON THE
   50  NUMBER OF EMPLOYEES LOCATED IN THIS STATE ON THE LAST DAY OF  THE  FIRST
   51  TAXABLE  YEAR  THE TAXPAYER IS SUBJECT TO TAX IN THIS STATE. IF THE USES
   52  OF THE PROPERTY MUST BE AGGREGATED TO DETERMINE WHETHER THE PROPERTY  IS
   53  PRINCIPALLY  USED  IN  QUALIFYING USES, THEN EITHER EACH AFFILIATE USING
   54  THE PROPERTY MUST SATISFY THIS EMPLOYMENT TEST OR THIS  EMPLOYMENT  TEST
   55  MUST  BE  SATISFIED  THROUGH  THE  AGGREGATION  OF  THE EMPLOYEES OF THE
   56  TAXPAYER,  ITS  AFFILIATED  REGULATED  BROKER,  DEALER,  AND  REGISTERED
       A. 5394                             7
    1  INVESTMENT ADVISER USING THE PROPERTY. FOR PURPOSES OF THIS SUBDIVISION,
    2  THE  TERM  "GOODS"  SHALL  NOT INCLUDE ELECTRICITY. FOR PURPOSES OF THIS
    3  PARAGRAPH, MANUFACTURING SHALL MEAN THE PROCESS OF WORKING RAW MATERIALS
    4  INTO  WARES  SUITABLE FOR  USE OR WHICH GIVES NEW SHAPES, NEW QUALITY OR
    5  NEW COMBINATION TO MATTER WHICH ALREADY HAS GONE THROUGH SOME ARTIFICIAL
    6  PROCESS BY THE USE OF MACHINERY, TOOLS,  APPLIANCES  AND  OTHER  SIMILAR
    7  EQUIPMENT.  PROPERTY  USED  IN  THE  PRODUCTION  OF  GOODS SHALL INCLUDE
    8  MACHINERY, EQUIPMENT OR OTHER TANGIBLE  PROPERTY  WHICH  IS  PRINCIPALLY
    9  USED  IN  THE  REPAIR AND SERVICE OF OTHER MACHINERY, EQUIPMENT OR OTHER
   10  TANGIBLE PROPERTY USED PRINCIPALLY IN THE PRODUCTION OF GOODS AND  SHALL
   11  INCLUDE ALL FACILITIES USED IN THE PRODUCTION OPERATION, INCLUDING STOR-
   12  AGE  OF  MATERIAL  TO BE USED IN PRODUCTION AND OF THE PRODUCTS THAT ARE
   13  PRODUCED. FOR PURPOSES OF THIS PARAGRAPH, THE  TERMS  "INDUSTRIAL  WASTE
   14  TREATMENT  FACILITIES", "AIR POLLUTION CONTROL FACILITIES" AND "RESEARCH
   15  AND DEVELOPMENT PROPERTY" SHALL HAVE THE MEANINGS  ASCRIBED  THERETO  BY
   16  CLAUSES (II) AND (III), RESPECTIVELY, OF SUBPARAGRAPH FOUR OF THIS PARA-
   17  GRAPH,  AND THE PROVISIONS OF SUBPARAGRAPH THREE OF THIS PARAGRAPH SHALL
   18  APPLY.
   19    (C) A TAXPAYER SHALL NOT BE ALLOWED A CREDIT  UNDER  THIS  SUBDIVISION
   20  WITH  RESPECT TO ANY TANGIBLE PERSONAL PROPERTY AND OTHER TANGIBLE PROP-
   21  ERTY, INCLUDING BUILDINGS AND STRUCTURAL COMPONENTS OF BUILDINGS,  WHICH
   22  IT  LEASES  TO  ANY  OTHER PERSON OR CORPORATION EXCEPT WHERE A TAXPAYER
   23  LEASES PROPERTY TO AN AFFILIATED REGULATED BROKER, DEALER, OR REGISTERED
   24  INVESTMENT ADVISER THAT USES SUCH PROPERTY  IN  ACCORDANCE  WITH  CLAUSE
   25  (IV)  OR  (V) OF SUBPARAGRAPH FOUR OF PARAGRAPH (B) OF THIS SUBDIVISION.
   26  FOR PURPOSES OF THE PRECEDING SENTENCE, ANY  CONTRACT  OR  AGREEMENT  TO
   27  LEASE  OR RENT OR FOR A LICENSE TO USE SUCH PROPERTY SHALL BE CONSIDERED
   28  A LEASE. PROVIDED, HOWEVER, IN DETERMINING WHETHER A TAXPAYER  SHALL  BE
   29  ALLOWED  A  CREDIT UNDER THIS SUBDIVISION WITH RESPECT TO SUCH PROPERTY,
   30  ANY ELECTION  MADE  WITH  RESPECT  TO  SUCH  PROPERTY  PURSUANT  TO  THE
   31  PROVISIONS  OF  PARAGRAPH EIGHT OF SUBSECTION (F) OF SECTION ONE HUNDRED
   32  SIXTY-EIGHT OF THE INTERNAL REVENUE  CODE,  AS  SUCH  PARAGRAPH  WAS  IN
   33  EFFECT  FOR  AGREEMENTS  ENTERED  INTO  PRIOR TO JANUARY FIRST, NINETEEN
   34  HUNDRED EIGHTY-FOUR, SHALL BE DISREGARDED.
   35    (D) IF THE AMOUNT OF CREDIT ALLOWED UNDER  THIS  SUBDIVISION  FOR  ANY
   36  TAXABLE  YEAR  SHALL EXCEED THE TAXPAYER'S TAX FOR SUCH YEAR, THE EXCESS
   37  MAY BE CARRIED OVER TO THE FOLLOWING YEAR OR YEARS AND MAY  BE  DEDUCTED
   38  FROM THE TAXPAYER'S TAX FOR SUCH YEAR OR YEARS. ANY REFUND PAID PURSUANT
   39  TO  THIS  PARAGRAPH  SHALL BE DEEMED TO BE A REFUND OF AN OVERPAYMENT OF
   40  TAX AS PROVIDED IN SECTION  SIX  HUNDRED  EIGHTY-SIX  OF  THIS  CHAPTER,
   41  PROVIDED, HOWEVER, THAT NO INTEREST SHALL BE PAID THEREON.
   42    47. DISCOVERY WAGE TAX CREDIT. (A) A TAXPAYER SHALL BE ALLOWED A CRED-
   43  IT,  TO  BE COMPUTED AS HEREINAFTER PROVIDED, AGAINST THE TAX IMPOSED BY
   44  THIS ARTICLE, WHERE THE TAXPAYER HAS BEEN CERTIFIED PURSUANT TO  SECTION
   45  NINE  HUNDRED  SEVENTY-TWO  OF  THE GENERAL MUNICIPAL LAW. THE AMOUNT OF
   46  SUCH CREDIT SHALL BE AS PRESCRIBED IN PARAGRAPH (C) OF THIS SUBDIVISION.
   47    (B) "DISCOVERY WAGES" MEANS WAGES PAID BY THE TAXPAYER  FOR  FULL-TIME
   48  EMPLOYMENT  DURING A TAXABLE YEAR, PROVIDED THAT THOSE WAGES ARE PAID BY
   49  A CERTIFIED BUSINESS AS DEFINED BY THE COMMISSIONER OF ECONOMIC DEVELOP-
   50  MENT AS REQUIRED IN HIS OR HER RESPONSIBILITIES.
   51    (C) THE CREDIT PROVIDED IN THIS SUBDIVISION  SHALL  BE  EQUAL  TO  THE
   52  PRODUCT  OF  THE  GROSS  WAGES  PAID  AND SIX AND EIGHTY-FIVE HUNDREDTHS
   53  PERCENT FOR EACH NET NEW JOB CREATED DURING THE TAXABLE YEAR.
   54    (D) "NET NEW JOB" SHALL BE DEFINED AS EACH JOB THAT EXCEEDS THE  AVER-
   55  AGE  NUMBER  OF  INDIVIDUALS  EMPLOYED  FULL-TIME BY THE TAXPAYER IN THE
   56  PREVIOUS TAXABLE YEAR.
       A. 5394                             8
    1    (E) IF THE AMOUNT OF THIS CREDIT AND CARRYOVERS OF SUCH CREDIT ALLOWED
    2  UNDER THIS SUBDIVISION FOR ANY TAXABLE YEAR SHALL EXCEED THE  TAXPAYER'S
    3  TAX  FOR  SUCH  YEAR,  THE  EXCESS, AS WELL AS ANY PART OF THE CREDIT OR
    4  CARRYOVERS OF SUCH CREDIT, OR BOTH, WHICH MAY NOT BE DEDUCTED  FROM  THE
    5  TAX OTHERWISE DUE BY REASON OF PARAGRAPH (C) OF THIS SUBDIVISION, MAY BE
    6  CARRIED OVER TO THE FOLLOWING YEAR OR YEARS AND MAY BE DEDUCTED FROM THE
    7  TAXPAYER'S TAX FOR SUCH YEAR OR YEARS.
    8    S  5.  Section  606  of  the  tax  law  is  amended  by adding two new
    9  subsections (j-2) and (j-3) to read as follows:
   10    (J-2) DISCOVERY INVESTMENT CREDIT. (1) A TAXPAYER SHALL BE  ALLOWED  A
   11  CREDIT,  TO BE COMPUTED AS HEREINAFTER PROVIDED, AGAINST THE TAX IMPOSED
   12  BY THIS ARTICLE WHERE  THE  TAXPAYER  HAS  BEEN  CERTIFIED  PURSUANT  TO
   13  SECTION  NINE  HUNDRED  SEVENTY-TWO  OF  THE  GENERAL MUNICIPAL LAW. THE
   14  AMOUNT OF SUCH CREDIT SHALL BE TWENTY PERCENT OF THE COST OR OTHER BASIS
   15  FOR FEDERAL INCOME TAX PURPOSES OF TANGIBLE PERSONAL PROPERTY AND  OTHER
   16  TANGIBLE  PROPERTY,  INCLUDING  BUILDINGS  AND  STRUCTURAL COMPONENTS OF
   17  BUILDINGS, DESCRIBED IN PARAGRAPH TWO OF THIS SUBSECTION,  BUT  ONLY  IF
   18  THE  ACQUISITION, CONSTRUCTION, RECONSTRUCTION OR ERECTION OF SUCH PROP-
   19  ERTY OCCURRED OR WAS COMMENCED ON OR AFTER THE DATE OF SUCH  DESIGNATION
   20  AND PRIOR TO THE EXPIRATION THEREOF. PROVIDED, HOWEVER, THAT IN THE CASE
   21  OF  AN  ACQUISITION,  CONSTRUCTION, RECONSTRUCTION OR ERECTION WHICH WAS
   22  COMMENCED DURING SUCH PERIOD AND CONTINUED  OR  COMPLETED  SUBSEQUENTLY,
   23  THE  CREDIT  SHALL BE TWENTY PERCENT OF THE PORTION OF THE COST OR OTHER
   24  BASIS FOR FEDERAL INCOME TAX PURPOSES ATTRIBUTABLE TO SUCH PERIOD, WHICH
   25  PORTION SHALL BE ASCERTAINED BY MULTIPLYING SUCH  COST  OR  BASIS  BY  A
   26  FRACTION  THE  NUMERATOR  OF  WHICH  SHALL  BE  THE EXPENDITURES PAID OR
   27  INCURRED DURING SUCH PERIOD FOR SUCH PURPOSES  AND  THE  DENOMINATOR  OF
   28  WHICH  SHALL  BE THE TOTAL OF ALL EXPENDITURES PAID OR INCURRED FOR SUCH
   29  ACQUISITION, CONSTRUCTION, RECONSTRUCTION OR ERECTION.
   30    (2) A CREDIT SHALL BE ALLOWED UNDER THIS SUBSECTION  WITH  RESPECT  TO
   31  TANGIBLE PERSONAL PROPERTY AND OTHER TANGIBLE PROPERTY, INCLUDING BUILD-
   32  INGS  AND  STRUCTURAL COMPONENTS OF BUILDINGS WHICH: (A) ARE DEPRECIABLE
   33  PURSUANT TO SECTION ONE HUNDRED  SIXTY-SEVEN  OF  THE  INTERNAL  REVENUE
   34  CODE,  (B) HAVE A USEFUL LIFE OF FOUR YEARS OR MORE, (C) ARE ACQUIRED BY
   35  PURCHASE AS DEFINED IN SECTION  ONE  HUNDRED  SEVENTY-NINE  (D)  OF  THE
   36  INTERNAL  REVENUE CODE, AND (D) ARE (I) PRINCIPALLY USED BY THE TAXPAYER
   37  IN THE PRODUCTION OF GOODS  BY  MANUFACTURING,  PROCESSING,  ASSEMBLING,
   38  REFINING, MINING, EXTRACTING, FARMING, AGRICULTURE, HORTICULTURE, FLORI-
   39  CULTURE, VITICULTURE OR COMMERCIAL FISHING, (II) INDUSTRIAL WASTE TREAT-
   40  MENT  FACILITIES OR AIR POLLUTION CONTROL FACILITIES USED IN THE TAXPAY-
   41  ER'S TRADE OR BUSINESS, (III) RESEARCH AND  DEVELOPMENT  PROPERTY,  (IV)
   42  PRINCIPALLY USED IN THE ORDINARY COURSE OF THE TAXPAYER'S TRADE OR BUSI-
   43  NESS  AS  A  BROKER  OR  DEALER  IN CONNECTION WITH THE PURCHASE OR SALE
   44  (WHICH SHALL INCLUDE BUT NOT BE LIMITED TO THE ISSUANCE, ENTERING  INTO,
   45  ASSUMPTION,  OFFSET,  ASSIGNMENT,  TERMINATION,  OR TRANSFER) OF STOCKS,
   46  BONDS  OR  OTHER  SECURITIES  AS  DEFINED  IN   SECTION   FOUR   HUNDRED
   47  SEVENTY-FIVE  (C)(2)  OF THE INTERNAL REVENUE CODE, OR OF COMMODITIES AS
   48  DEFINED IN SECTION FOUR HUNDRED SEVENTY-FIVE (E) OF THE INTERNAL REVENUE
   49  CODE, OR (V) PRINCIPALLY USED IN THE ORDINARY COURSE OF  THE  TAXPAYER'S
   50  TRADE  OR  BUSINESS  OF PROVIDING INVESTMENT ADVISORY SERVICES FOR REGU-
   51  LATED INVESTMENT COMPANY AS DEFINED IN SECTION EIGHT  HUNDRED  FIFTY-ONE
   52  OF THE INTERNAL REVENUE CODE, OR LENDING, LOAN ARRANGEMENT OR LOAN ORIG-
   53  INATION  SERVICES  TO  CUSTOMERS IN CONNECTION WITH THE PURCHASE OR SALE
   54  (WHICH SHALL INCLUDE BUT NOT BE LIMITED TO THE ISSUANCE, ENTERING  INTO,
   55  ASSUMPTION,  OFFSET, ASSIGNMENT, TERMINATION, OR TRANSFER) OF SECURITIES
   56  AS DEFINED IN SECTION FOUR HUNDRED SEVENTY-FIVE(C)(2)  OF  THE  INTERNAL
       A. 5394                             9
    1  REVENUE CODE. FOR PURPOSES OF CLAUSES (IV) AND (V) OF THIS SUBPARAGRAPH,
    2  PROPERTY  PURCHASED  BY  A  TAXPAYER AFFILIATED WITH A REGULATED BROKER,
    3  DEALER OR REGISTERED INVESTMENT ADVISER IS ALLOWED A CREDIT  UNDER  THIS
    4  SUBSECTION  IF  THE PROPERTY IS USED BY ITS AFFILIATED REGULATED BROKER,
    5  DEALER  OR  REGISTERED  INVESTMENT  ADVISER  IN  ACCORDANCE  WITH   THIS
    6  SUBSECTION.  FOR  PURPOSES OF DETERMINING IF THE PROPERTY IS PRINCIPALLY
    7  USED IN QUALIFYING USES, THE USES BY THE TAXPAYER DESCRIBED  IN  CLAUSES
    8  (IV)  AND  (V)  OF THIS SUBPARAGRAPH MAY BE AGGREGATED. IN ADDITION, THE
    9  USES BY THE TAXPAYER,  ITS  AFFILIATED  REGULATED  BROKER,  DEALER,  AND
   10  REGISTERED  INVESTMENT ADVISER UNDER EITHER OR BOTH OF THOSE CLAUSES MAY
   11  BE AGGREGATED. PROVIDED, HOWEVER, A TAXPAYER SHALL NOT  BE  ALLOWED  THE
   12  CREDIT  PROVIDED BY CLAUSES (IV) AND (V) OF THIS SUBPARAGRAPH UNLESS (I)
   13  EIGHTY PERCENT OR MORE OF THE EMPLOYEES  PERFORMING  THE  ADMINISTRATIVE
   14  AND  SUPPORT  FUNCTIONS RESULTING FROM OR RELATED TO THE QUALIFYING USES
   15  OF SUCH EQUIPMENT ARE LOCATED IN THIS STATE, OR (II) THE AVERAGE  NUMBER
   16  OF  EMPLOYEES  THAT  PERFORM  THE  ADMINISTRATIVE  AND SUPPORT FUNCTIONS
   17  RESULTING FROM OR RELATED TO THE QUALIFYING USES OF SUCH  EQUIPMENT  AND
   18  ARE  LOCATED  IN THIS STATE DURING THE TAXABLE YEAR FOR WHICH THE CREDIT
   19  IS CLAIMED IS EQUAL TO OR GREATER THAN NINETY-FIVE PERCENT OF THE  AVER-
   20  AGE  NUMBER OF EMPLOYEES THAT PERFORM THESE FUNCTIONS AND ARE LOCATED IN
   21  THIS STATE DURING THE THIRTY-SIX MONTHS IMMEDIATELY PRECEDING  THE  YEAR
   22  FOR  WHICH  THE  CREDIT  IS  CLAIMED,  OR  (III) THE NUMBER OF EMPLOYEES
   23  LOCATED IN THIS STATE DURING THE TAXABLE YEAR FOR WHICH  THE  CREDIT  IS
   24  CLAIMED  IS  EQUAL  TO  OR  GREATER THAN NINETY PERCENT OF THE NUMBER OF
   25  EMPLOYEES LOCATED IN  THIS  STATE  ON  DECEMBER  THIRTY-FIRST,  NINETEEN
   26  HUNDRED NINETY-EIGHT OR, IF THE TAXPAYER WAS NOT A CALENDAR YEAR TAXPAY-
   27  ER  IN  NINETEEN HUNDRED NINETY-EIGHT, THE LAST DAY OF ITS FIRST TAXABLE
   28  YEAR ENDING AFTER DECEMBER THIRTY-FIRST, NINETEEN HUNDRED  NINETY-EIGHT.
   29  IF  THE  TAXPAYER BECOMES SUBJECT TO TAX IN THIS STATE AFTER THE TAXABLE
   30  YEAR BEGINNING IN NINETEEN HUNDRED NINETY-EIGHT, THEN  THE  TAXPAYER  IS
   31  NOT  REQUIRED  TO  SATISFY THE EMPLOYMENT TEST PROVIDED IN THE PRECEDING
   32  SENTENCE OF THIS SUBPARAGRAPH FOR ITS FIRST TAXABLE YEAR.  FOR  PURPOSES
   33  OF  ITEM  (III) OF THIS CLAUSE, THE EMPLOYMENT TEST WILL BE BASED ON THE
   34  NUMBER OF EMPLOYEES LOCATED IN THIS STATE ON THE LAST DAY OF  THE  FIRST
   35  TAXABLE  YEAR  THE TAXPAYER IS SUBJECT TO TAX IN THIS STATE. IF THE USES
   36  OF THE PROPERTY MUST BE AGGREGATED TO DETERMINE WHETHER THE PROPERTY  IS
   37  PRINCIPALLY  USED  IN  QUALIFYING USES, THEN EITHER EACH AFFILIATE USING
   38  THE PROPERTY MUST SATISFY THIS EMPLOYMENT TEST OR THIS  EMPLOYMENT  TEST
   39  MUST  BE  SATISFIED  THROUGH  THE  AGGREGATION  OF  THE EMPLOYEES OF THE
   40  TAXPAYER,  ITS  AFFILIATED  REGULATED  BROKER,  DEALER,  AND  REGISTERED
   41  INVESTMENT  ADVISOR USING THE PROPERTY. FOR PURPOSES OF THIS SUBSECTION,
   42  THE TERM "GOODS" SHALL NOT INCLUDE ELECTRICITY.  FOR  PURPOSES  OF  THIS
   43  PARAGRAPH, MANUFACTURING SHALL MEAN THE PROCESS OF WORKING RAW MATERIALS
   44  INTO  WARES  SUITABLE  FOR USE OR WHICH GIVES NEW SHAPES, NEW QUALITY OR
   45  NEW COMBINATION TO MATTER WHICH ALREADY HAS GONE THROUGH SOME ARTIFICIAL
   46  PROCESS BY THE USE OF MACHINERY, TOOLS,  APPLIANCES  AND  OTHER  SIMILAR
   47  EQUIPMENT.  PROPERTY  USED  IN  THE  PRODUCTION  OF  GOODS SHALL INCLUDE
   48  MACHINERY, EQUIPMENT OR OTHER TANGIBLE  PROPERTY  WHICH  IS  PRINCIPALLY
   49  USED  IN  THE  REPAIR AND SERVICE OF OTHER MACHINERY, EQUIPMENT OR OTHER
   50  TANGIBLE PROPERTY USED PRINCIPALLY IN THE PRODUCTION OF GOODS AND  SHALL
   51  INCLUDE ALL FACILITIES USED IN THE PRODUCTION OPERATION, INCLUDING STOR-
   52  AGE  OF  MATERIAL  TO BE USED IN PRODUCTION AND OF THE PRODUCTS THAT ARE
   53  PRODUCED. FOR PURPOSES OF THIS PARAGRAPH, THE  TERMS  "INDUSTRIAL  WASTE
   54  TREATMENT  FACILITIES", "AIR POLLUTION CONTROL FACILITIES" AND "RESEARCH
   55  AND DEVELOPMENT PROPERTY" SHALL HAVE THE MEANINGS  ASCRIBED  THERETO  BY
       A. 5394                            10
    1  CLAUSES  (II) AND (III), RESPECTIVELY, OF SUBPARAGRAPH (D) OF THIS PARA-
    2  GRAPH, AND THE PROVISIONS OF SUBPARAGRAPH (C) OF THIS PARAGRAPH.
    3    (3)  A  TAXPAYER  SHALL  NOT BE ALLOWED A CREDIT UNDER THIS SUBSECTION
    4  WITH RESPECT TO ANY TANGIBLE PERSONAL PROPERTY AND OTHER TANGIBLE  PROP-
    5  ERTY,  INCLUDING BUILDINGS AND STRUCTURAL COMPONENTS OF BUILDINGS, WHICH
    6  IT LEASES TO ANY OTHER PERSON OR CORPORATION  EXCEPT  WHERE  A  TAXPAYER
    7  LEASES PROPERTY TO AN AFFILIATED REGULATED BROKER, DEALER, OR REGISTERED
    8  INVESTMENT  ADVISER  THAT  USES  SUCH PROPERTY IN ACCORDANCE WITH CLAUSE
    9  (IV) OR (V) OF SUBPARAGRAPH (D) OF PARAGRAPH TWO OF THIS SUBSECTION. FOR
   10  PURPOSES OF THE PRECEDING SENTENCE, ANY CONTRACT OR AGREEMENT  TO  LEASE
   11  OR  RENT  OR  FOR  A  LICENSE TO USE SUCH PROPERTY SHALL BE CONSIDERED A
   12  LEASE. PROVIDED, HOWEVER, IN DETERMINING WHETHER  A  TAXPAYER  SHALL  BE
   13  ALLOWED  A  CREDIT  UNDER THIS SUBSECTION WITH RESPECT TO SUCH PROPERTY,
   14  ANY ELECTION  MADE  WITH  RESPECT  TO  SUCH  PROPERTY  PURSUANT  TO  THE
   15  PROVISIONS  OF  PARAGRAPH EIGHT OF SUBSECTION (F) OF SECTION ONE HUNDRED
   16  SIXTY-EIGHT OF THE INTERNAL REVENUE  CODE,  AS  SUCH  PARAGRAPH  WAS  IN
   17  EFFECT  FOR  AGREEMENTS  ENTERED  INTO  PRIOR TO JANUARY FIRST, NINETEEN
   18  HUNDRED EIGHTY-FOUR, SHALL BE DISREGARDED.
   19    (4) IF THE AMOUNT OF CREDIT ALLOWED  UNDER  THIS  SUBSECTION  FOR  ANY
   20  TAXABLE  YEAR  SHALL EXCEED THE TAXPAYER'S TAX FOR SUCH YEAR, THE EXCESS
   21  MAY BE CARRIED OVER TO THE FOLLOWING YEAR OR YEARS AND MAY  BE  DEDUCTED
   22  FROM  THE TAXPAYER'S TAX FOR SUCH YEAR OR  YEARS. ANY REFUND PAID PURSU-
   23  ANT TO THIS PARAGRAPH SHALL BE DEEMED TO BE A REFUND OF  AN  OVERPAYMENT
   24  OF  TAX  AS  PROVIDED IN SECTION SIX HUNDRED EIGHTY-SIX OF THIS CHAPTER,
   25  PROVIDED, HOWEVER, THAT NO INTEREST SHALL BE PAID THEREON.
   26    (J-3) DISCOVERY WAGE TAX CREDIT. (1) A TAXPAYER  SHALL  BE  ALLOWED  A
   27  CREDIT,  TO BE COMPUTED AS HEREINAFTER PROVIDED, AGAINST THE TAX IMPOSED
   28  BY THIS ARTICLE, WHERE THE  TAXPAYER  HAS  BEEN  CERTIFIED  PURSUANT  TO
   29  SECTION  NINE  HUNDRED  SEVENTY-TWO  OF  THE  GENERAL MUNICIPAL LAW. THE
   30  AMOUNT OF SUCH CREDIT SHALL BE AS PRESCRIBED IN PARAGRAPH THREE OF  THIS
   31  SUBSECTION.
   32    (2)  "DISCOVERY  WAGES" MEANS WAGES PAID BY THE TAXPAYER FOR FULL-TIME
   33  EMPLOYMENT DURING A TAXABLE YEAR, PROVIDED THAT THOSE WAGES ARE PAID  BY
   34  A CERTIFIED BUSINESS AS DEFINED BY THE COMMISSIONER OF ECONOMIC DEVELOP-
   35  MENT AS REQUIRED IN HIS OR HER RESPONSIBILITIES.
   36    (3) THE CREDIT PROVIDED IN THIS SUBSECTION SHALL BE EQUAL TO THE PROD-
   37  UCT  OF  THE GROSS WAGES PAID AND SIX AND EIGHTY-FIVE HUNDREDTHS PERCENT
   38  FOR EACH NET NEW JOB CREATED DURING THE TAXABLE YEAR.
   39    (4) "NET NEW JOB" SHALL BE DEFINED AS EACH JOB THAT EXCEEDS THE  AVER-
   40  AGE  NUMBER  OF  INDIVIDUALS  EMPLOYED  FULL-TIME BY THE TAXPAYER IN THE
   41  PREVIOUS TAXABLE YEAR.
   42    (5) IF THE AMOUNT OF THIS CREDIT AND CARRYOVERS OF SUCH CREDIT ALLOWED
   43  UNDER THIS SUBSECTION FOR ANY TAXABLE YEAR SHALL EXCEED  THE  TAXPAYER'S
   44  TAX  FOR  SUCH  YEAR,  THE  EXCESS, AS WELL AS ANY PART OF THE CREDIT OR
   45  CARRYOVERS OF SUCH CREDIT, OR BOTH, WHICH MAY NOT BE DEDUCTED  FROM  THE
   46  TAX  OTHERWISE  DUE BY REASON OF PARAGRAPH THREE OF THIS SUBSECTION, MAY
   47  BE CARRIED OVER TO THE FOLLOWING YEAR OR YEARS AND MAY BE DEDUCTED  FROM
   48  THE TAXPAYER'S TAX FOR SUCH YEAR OR YEARS.
   49    S  6.  Section  1456  of  the  tax  law  is  amended by adding two new
   50  subsections (z) and (aa) to read as follows:
   51    (Z) DISCOVERY INVESTMENT CREDIT. (1) A TAXPAYER  SHALL  BE  ALLOWED  A
   52  CREDIT,  TO BE COMPUTED AS HEREINAFTER PROVIDED, AGAINST THE TAX IMPOSED
   53  BY THIS ARTICLE WHERE  THE  TAXPAYER  HAS  BEEN  CERTIFIED  PURSUANT  TO
   54  SECTION  NINE  HUNDRED  SEVENTY-TWO  OF  THE  GENERAL MUNICIPAL LAW. THE
   55  AMOUNT OF SUCH CREDIT SHALL BE TWENTY PERCENT OF THE COST OR OTHER BASIS
   56  FOR FEDERAL INCOME TAX PURPOSES OF TANGIBLE PERSONAL PROPERTY AND  OTHER
       A. 5394                            11
    1  TANGIBLE  PROPERTY,  INCLUDING  BUILDINGS  AND  STRUCTURAL COMPONENTS OF
    2  BUILDINGS, DESCRIBED IN PARAGRAPH TWO OF THIS SUBSECTION,  BUT  ONLY  IF
    3  THE  ACQUISITION, CONSTRUCTION, RECONSTRUCTION OR ERECTION OF SUCH PROP-
    4  ERTY  OCCURRED OR WAS COMMENCED ON OR AFTER THE DATE OF SUCH DESIGNATION
    5  AND PRIOR TO THE EXPIRATION THEREOF. PROVIDED, HOWEVER, THAT IN THE CASE
    6  OF AN ACQUISITION, CONSTRUCTION, RECONSTRUCTION OR  ERECTION  WHICH  WAS
    7  COMMENCED  DURING  SUCH  PERIOD AND CONTINUED OR COMPLETED SUBSEQUENTLY,
    8  THE CREDIT SHALL BE TWENTY PERCENT OF THE PORTION OF THE COST  OR  OTHER
    9  BASIS FOR FEDERAL INCOME TAX PURPOSES ATTRIBUTABLE TO SUCH PERIOD, WHICH
   10  PORTION  SHALL  BE  ASCERTAINED  BY  MULTIPLYING SUCH COST OR BASIS BY A
   11  FRACTION THE NUMERATOR OF  WHICH  SHALL  BE  THE  EXPENDITURES  PAID  OR
   12  INCURRED  DURING  SUCH  PERIOD  FOR SUCH PURPOSES AND THE DENOMINATOR OF
   13  WHICH SHALL BE THE TOTAL OF ALL EXPENDITURES PAID OR INCURRED  FOR  SUCH
   14  ACQUISITION, CONSTRUCTION, RECONSTRUCTION OR ERECTION.
   15    (2)  A  CREDIT  SHALL BE ALLOWED UNDER THIS SUBSECTION WITH RESPECT TO
   16  TANGIBLE PERSONAL PROPERTY AND OTHER TANGIBLE PROPERTY, INCLUDING BUILD-
   17  INGS AND STRUCTURAL COMPONENTS OF BUILDINGS WHICH: (A)  ARE  DEPRECIABLE
   18  PURSUANT  TO  SECTION  ONE  HUNDRED  SIXTY-SEVEN OF THE INTERNAL REVENUE
   19  CODE, (B) HAVE A USEFUL LIFE OF FOUR YEARS OR MORE, (C) ARE ACQUIRED  BY
   20  PURCHASE  AS  DEFINED  IN  SECTION  ONE  HUNDRED SEVENTY-NINE (D) OF THE
   21  INTERNAL REVENUE CODE, AND (D) ARE (I) PRINCIPALLY USED BY THE  TAXPAYER
   22  IN  THE  PRODUCTION  OF  GOODS BY MANUFACTURING, PROCESSING, ASSEMBLING,
   23  REFINING, MINING, EXTRACTING, FARMING, AGRICULTURE, HORTICULTURE, FLORI-
   24  CULTURE, VITICULTURE OR COMMERCIAL FISHING, (II) INDUSTRIAL WASTE TREAT-
   25  MENT FACILITIES OR AIR POLLUTION CONTROL FACILITIES USED IN THE  TAXPAY-
   26  ER'S  TRADE  OR  BUSINESS, (III) RESEARCH AND DEVELOPMENT PROPERTY, (IV)
   27  PRINCIPALLY USED IN THE ORDINARY COURSE OF THE TAXPAYER'S TRADE OR BUSI-
   28  NESS AS A BROKER OR DEALER IN  CONNECTION  WITH  THE  PURCHASE  OR  SALE
   29  (WHICH  SHALL INCLUDE BUT NOT BE LIMITED TO THE ISSUANCE, ENTERING INTO,
   30  ASSUMPTION, OFFSET, ASSIGNMENT, TERMINATION,  OR  TRANSFER)  OF  STOCKS,
   31  BONDS   OR   OTHER   SECURITIES  AS  DEFINED  IN  SECTION  FOUR  HUNDRED
   32  SEVENTY-FIVE (C)(2) OF THE INTERNAL REVENUE CODE, OR OF  COMMODITIES  AS
   33  DEFINED IN SECTION FOUR HUNDRED SEVENTY-FIVE (E) OF THE INTERNAL REVENUE
   34  CODE,  OR  (V) PRINCIPALLY USED IN THE ORDINARY COURSE OF THE TAXPAYER'S
   35  TRADE OR BUSINESS OF PROVIDING INVESTMENT ADVISORY SERVICES FOR A  REGU-
   36  LATED  INVESTMENT  COMPANY AS DEFINED IN SECTION EIGHT HUNDRED FIFTY-ONE
   37  OF THE INTERNAL REVENUE CODE, OR LENDING, LOAN ARRANGEMENT OR LOAN ORIG-
   38  INATION SERVICES TO CUSTOMERS IN CONNECTION WITH THE  PURCHASE  OR  SALE
   39  (WHICH  SHALL INCLUDE BUT NOT BE LIMITED TO THE ISSUANCE, ENTERING INTO,
   40  ASSUMPTION, OFFSET, ASSIGNMENT, TERMINATION, OR TRANSFER) OF  SECURITIES
   41  AS  DEFINED  IN SECTION FOUR HUNDRED SEVENTY-FIVE (C)(2) OF THE INTERNAL
   42  REVENUE CODE. FOR PURPOSES OF CLAUSES (IV) AND (V) OF THIS SUBPARAGRAPH,
   43  PROPERTY PURCHASED BY A TAXPAYER AFFILIATED  WITH  A  REGULATED  BROKER,
   44  DEALER  OR  REGISTERED INVESTMENT ADVISER IS ALLOWED A CREDIT UNDER THIS
   45  SUBSECTION IF THE PROPERTY IS USED BY ITS AFFILIATED  REGULATED  BROKER,
   46  DEALER   OR  REGISTERED  INVESTMENT  ADVISER  IN  ACCORDANCE  WITH  THIS
   47  SUBSECTION. FOR PURPOSES OF DETERMINING IF THE PROPERTY  IS  PRINCIPALLY
   48  USED  IN  QUALIFYING USES, THE USES BY THE TAXPAYER DESCRIBED IN CLAUSES
   49  (IV) AND (V) OF THIS SUBPARAGRAPH MAY BE AGGREGATED.  IN  ADDITION,  THE
   50  USES  BY  THE  TAXPAYER,  ITS  AFFILIATED  REGULATED BROKER, DEALER, AND
   51  REGISTERED INVESTMENT ADVISER UNDER EITHER OR BOTH OF THOSE CLAUSES  MAY
   52  BE  AGGREGATED.  PROVIDED,  HOWEVER, A TAXPAYER SHALL NOT BE ALLOWED THE
   53  CREDIT PROVIDED BY CLAUSES (IV) AND (V) OF THIS SUBPARAGRAPH UNLESS  (I)
   54  EIGHTY  PERCENT  OR  MORE OF THE EMPLOYEES PERFORMING THE ADMINISTRATIVE
   55  AND SUPPORT FUNCTIONS RESULTING FROM OR RELATED TO THE  QUALIFYING  USES
   56  OF  SUCH EQUIPMENT ARE LOCATED IN THIS STATE, OR (II) THE AVERAGE NUMBER
       A. 5394                            12
    1  OF EMPLOYEES THAT  PERFORM  THE  ADMINISTRATIVE  AND  SUPPORT  FUNCTIONS
    2  RESULTING  FROM  OR RELATED TO THE QUALIFYING USES OF SUCH EQUIPMENT AND
    3  ARE LOCATED IN THIS STATE DURING THE TAXABLE YEAR FOR WHICH  THE  CREDIT
    4  IS  CLAIMED IS EQUAL TO OR GREATER THAN NINETY-FIVE PERCENT OF THE AVER-
    5  AGE NUMBER OF EMPLOYEES THAT PERFORM THESE FUNCTIONS AND ARE LOCATED  IN
    6  THIS  STATE  DURING THE THIRTY-SIX MONTHS IMMEDIATELY PRECEDING THE YEAR
    7  FOR WHICH THE CREDIT IS  CLAIMED,  OR  (III)  THE  NUMBER  OF  EMPLOYEES
    8  LOCATED  IN  THIS  STATE DURING THE TAXABLE YEAR FOR WHICH THE CREDIT IS
    9  CLAIMED IS EQUAL TO OR GREATER THAN NINETY  PERCENT  OF  THE  NUMBER  OF
   10  EMPLOYEES  LOCATED  IN  THIS  STATE  ON  DECEMBER THIRTY-FIRST, NINETEEN
   11  HUNDRED NINETY-EIGHT OR, IF THE TAXPAYER WAS NOT A CALENDAR YEAR TAXPAY-
   12  ER IN NINETEEN HUNDRED NINETY-EIGHT, THE LAST DAY OF ITS  FIRST  TAXABLE
   13  YEAR  ENDING AFTER DECEMBER THIRTY-FIRST, NINETEEN HUNDRED NINETY-EIGHT.
   14  IF THE TAXPAYER BECOMES SUBJECT TO TAX IN THIS STATE AFTER  THE  TAXABLE
   15  YEAR  BEGINNING  IN  NINETEEN HUNDRED NINETY-EIGHT, THEN THE TAXPAYER IS
   16  NOT REQUIRED TO SATISFY THE EMPLOYMENT TEST PROVIDED  IN  THE  PRECEDING
   17  SENTENCE  OF  THIS SUBPARAGRAPH FOR ITS FIRST TAXABLE YEAR. FOR PURPOSES
   18  OF ITEM (III) OF THIS CLAUSE, THE EMPLOYMENT TEST WILL BE BASED  ON  THE
   19  NUMBER  OF  EMPLOYEES LOCATED IN THIS STATE ON THE LAST DAY OF THE FIRST
   20  TAXABLE YEAR THE TAXPAYER IS SUBJECT TO TAX IN THIS STATE. IF  THE  USES
   21  OF  THE PROPERTY MUST BE AGGREGATED TO DETERMINE WHETHER THE PROPERTY IS
   22  PRINCIPALLY USED IN QUALIFYING USES, THEN EITHER  EACH  AFFILIATE  USING
   23  THE  PROPERTY  MUST SATISFY THIS EMPLOYMENT TEST OR THIS EMPLOYMENT TEST
   24  MUST BE SATISFIED THROUGH  THE  AGGREGATION  OF  THE  EMPLOYEES  OF  THE
   25  TAXPAYER,  ITS  AFFILIATED  REGULATED  BROKER,  DEALER,  AND  REGISTERED
   26  INVESTMENT ADVISER USING THE PROPERTY. FOR PURPOSES OF THIS  SUBSECTION,
   27  THE  TERM  "GOODS"  SHALL  NOT INCLUDE ELECTRICITY. FOR PURPOSES OF THIS
   28  PARAGRAPH, MANUFACTURING SHALL MEAN THE PROCESS OF WORKING RAW MATERIALS
   29  INTO WARES SUITABLE FOR USE OR WHICH GIVES NEW SHAPES,  NEW  QUALITY  OR
   30  NEW COMBINATION TO MATTER WHICH ALREADY HAS GONE THROUGH SOME ARTIFICIAL
   31  PROCESS  BY  THE  USE  OF MACHINERY, TOOLS, APPLIANCES AND OTHER SIMILAR
   32  EQUIPMENT. PROPERTY USED  IN  THE  PRODUCTION  OF  GOODS  SHALL  INCLUDE
   33  MACHINERY,  EQUIPMENT  OR  OTHER  TANGIBLE PROPERTY WHICH IS PRINCIPALLY
   34  USED IN THE REPAIR AND SERVICE OF OTHER MACHINERY,  EQUIPMENT  OR  OTHER
   35  TANGIBLE  PROPERTY USED PRINCIPALLY IN THE PRODUCTION OF GOODS AND SHALL
   36  INCLUDE ALL FACILITIES USED IN THE PRODUCTION OPERATION, INCLUDING STOR-
   37  AGE OF MATERIAL TO BE USED IN PRODUCTION AND OF THE  PRODUCTS  THAT  ARE
   38  PRODUCED.  FOR  PURPOSES  OF THIS PARAGRAPH, THE TERMS "INDUSTRIAL WASTE
   39  TREATMENT  FACILITIES",  AND  "AIR  POLLUTION  CONTROL  FACILITIES"  AND
   40  "RESEARCH  AND  DEVELOPMENT  PROPERTY"  SHALL HAVE THE MEANINGS ASCRIBED
   41  THERETO BY CLAUSES (II) AND (III), RESPECTIVELY, OF SUBPARAGRAPH (D)  OF
   42  THIS PARAGRAPH, AND THE PROVISIONS OF SUBPARAGRAPH (C) OF THIS PARAGRAPH
   43  SHALL APPLY.
   44    (3)  A  TAXPAYER  SHALL  NOT BE ALLOWED A CREDIT UNDER THIS SUBSECTION
   45  WITH RESPECT TO ANY TANGIBLE PERSONAL PROPERTY AND OTHER TANGIBLE  PROP-
   46  ERTY,  INCLUDING BUILDINGS AND STRUCTURAL COMPONENTS OF BUILDINGS, WHICH
   47  IT LEASES TO ANY OTHER PERSON OR CORPORATION  EXCEPT  WHERE  A  TAXPAYER
   48  LEASES PROPERTY TO AN AFFILIATED REGULATED BROKER, DEALER, OR REGISTERED
   49  INVESTMENT  ADVISER  THAT  USES  SUCH PROPERTY IN ACCORDANCE WITH CLAUSE
   50  (IV) OR (V) OF SUBPARAGRAPH (D) OF PARAGRAPH TWO OF THIS SUBSECTION. FOR
   51  PURPOSES OF THE PRECEDING SENTENCE, ANY CONTRACT OR AGREEMENT  TO  LEASE
   52  OR  RENT  OR  FOR  A  LICENSE TO USE SUCH PROPERTY SHALL BE CONSIDERED A
   53  LEASE. PROVIDED, HOWEVER, IN DETERMINING WHETHER  A  TAXPAYER  SHALL  BE
   54  ALLOWED  A  CREDIT  UNDER THIS SUBSECTION WITH RESPECT TO SUCH PROPERTY,
   55  ANY ELECTION  MADE  WITH  RESPECT  TO  SUCH  PROPERTY  PURSUANT  TO  THE
   56  PROVISIONS  OF  PARAGRAPH EIGHT OF SUBSECTION (F) OF SECTION ONE HUNDRED
       A. 5394                            13
    1  SIXTY-EIGHT OF THE INTERNAL REVENUE  CODE,  AS  SUCH  PARAGRAPH  WAS  IN
    2  EFFECT  FOR  AGREEMENTS  ENTERED  INTO  PRIOR TO JANUARY FIRST, NINETEEN
    3  HUNDRED EIGHTY-FOUR, SHALL BE DISREGARDED.
    4    (4)  IF  THE  AMOUNT  OF  CREDIT ALLOWED UNDER THIS SUBSECTION FOR ANY
    5  TAXABLE YEAR SHALL EXCEED THE TAXPAYER'S TAX FOR SUCH YEAR,  THE  EXCESS
    6  MAY  BE  CARRIED OVER TO THE FOLLOWING YEAR OR YEARS AND MAY BE DEDUCTED
    7  FROM THE TAXPAYER'S TAX FOR SUCH YEAR OR YEARS. ANY REFUND PAID PURSUANT
    8  TO THIS PARAGRAPH SHALL BE DEEMED TO BE A REFUND OF  AN  OVERPAYMENT  OF
    9  TAX  AS  PROVIDED  IN  SECTION  SIX  HUNDRED EIGHTY-SIX OF THIS CHAPTER,
   10  PROVIDED, HOWEVER, THAT NO INTEREST SHALL BE PAID THEREON.
   11    (AA) DISCOVERY WAGE TAX CREDIT. (1) A  TAXPAYER  SHALL  BE  ALLOWED  A
   12  CREDIT,  TO BE COMPUTED AS HEREINAFTER PROVIDED, AGAINST THE TAX IMPOSED
   13  BY THIS ARTICLE, WHERE THE  TAXPAYER  HAS  BEEN  CERTIFIED  PURSUANT  TO
   14  SECTION  NINE  HUNDRED  SEVENTY-TWO  OF  THE  GENERAL MUNICIPAL LAW. THE
   15  AMOUNT OF SUCH CREDIT SHALL BE AS PRESCRIBED IN PARAGRAPH THREE OF  THIS
   16  SUBSECTION.
   17    (2)  "DISCOVERY  WAGES" MEANS WAGES PAID BY THE TAXPAYER FOR FULL-TIME
   18  EMPLOYMENT DURING A TAXABLE YEAR, PROVIDED THAT THOSE WAGES ARE PAID  BY
   19  A CERTIFIED BUSINESS AS DEFINED BY THE COMMISSIONER OF ECONOMIC DEVELOP-
   20  MENT AS REQUIRED IN HIS OR HER RESPONSIBILITIES.
   21    (3) THE CREDIT PROVIDED IN THIS SUBSECTION SHALL BE EQUAL TO THE PROD-
   22  UCT  OF  THE GROSS WAGES PAID AND SIX AND EIGHTY-FIVE HUNDREDTHS PERCENT
   23  FOR EACH NET NEW JOB CREATED DURING THE TAXABLE YEAR.
   24    (4) "NET NEW JOB" SHALL BE DEFINED AS EACH JOB THAT EXCEEDS THE  AVER-
   25  AGE  NUMBER  OF  INDIVIDUALS  EMPLOYED  FULL-TIME BY THE TAXPAYER IN THE
   26  PREVIOUS TAXABLE YEAR.
   27    (5) IF THE AMOUNT OF THIS CREDIT AND CARRYOVERS OF SUCH CREDIT ALLOWED
   28  UNDER THIS SUBSECTION FOR ANY TAXABLE YEAR SHALL EXCEED  THE  TAXPAYER'S
   29  TAX  FOR  SUCH  YEAR,  THE  EXCESS, AS WELL AS ANY PART OF THE CREDIT OR
   30  CARRYOVERS OF SUCH CREDIT, OR BOTH, WHICH MAY NOT BE DEDUCTED  FROM  THE
   31  TAX  OTHERWISE  DUE BY REASON OF PARAGRAPH THREE OF THIS SUBSECTION, MAY
   32  BE CARRIED OVER TO THE FOLLOWING YEAR OR YEARS AND MAY BE DEDUCTED  FROM
   33  THE TAXPAYER'S TAX FOR SUCH YEAR OR YEARS.
   34    S 7. Section 1511 of the tax law is amended by adding two new subdivi-
   35  sions (cc) and (dd) to read as follows:
   36    (CC)  DISCOVERY  INVESTMENT CREDIT.  (1) A TAXPAYER SHALL BE ALLOWED A
   37  CREDIT, TO BE COMPUTED AS HEREINAFTER PROVIDED, AGAINST THE TAX  IMPOSED
   38  BY  THIS  ARTICLE  WHERE  THE  TAXPAYER  HAS  BEEN CERTIFIED PURSUANT TO
   39  SECTION NINE HUNDRED SEVENTY-TWO  OF  THE  GENERAL  MUNICIPAL  LAW.  THE
   40  AMOUNT OF SUCH CREDIT SHALL BE TWENTY PERCENT OF THE COST OR OTHER BASIS
   41  FOR  FEDERAL INCOME TAX PURPOSES OF TANGIBLE PERSONAL PROPERTY AND OTHER
   42  TANGIBLE PROPERTY, INCLUDING  BUILDINGS  AND  STRUCTURAL  COMPONENTS  OF
   43  BUILDINGS,  DESCRIBED  IN PARAGRAPH TWO OF THIS SUBDIVISION, BUT ONLY IF
   44  THE ACQUISITION, CONSTRUCTION, RECONSTRUCTION OR ERECTION OF SUCH  PROP-
   45  ERTY  OCCURRED OR WAS COMMENCED ON OR AFTER THE DATE OF SUCH DESIGNATION
   46  AND PRIOR TO THE EXPIRATION THEREOF. PROVIDED, HOWEVER, THAT IN THE CASE
   47  OF AN ACQUISITION, CONSTRUCTION, RECONSTRUCTION OR  ERECTION  WHICH  WAS
   48  COMMENCED  DURING  SUCH  PERIOD AND CONTINUED OR COMPLETED SUBSEQUENTLY,
   49  THE CREDIT SHALL BE TWENTY PERCENT OF THE PORTION OF THE COST  OR  OTHER
   50  BASIS FOR FEDERAL INCOME TAX PURPOSES ATTRIBUTABLE TO SUCH PERIOD, WHICH
   51  PORTION  SHALL  BE  ASCERTAINED  BY  MULTIPLYING SUCH COST OR BASIS BY A
   52  FRACTION THE NUMERATOR OF  WHICH  SHALL  BE  THE  EXPENDITURES  PAID  OR
   53  INCURRED  DURING  SUCH  PERIOD  FOR SUCH PURPOSES AND THE DENOMINATOR OF
   54  WHICH SHALL BE THE TOTAL OF ALL EXPENDITURES PAID OR INCURRED  FOR  SUCH
   55  ACQUISITION, CONSTRUCTION, RECONSTRUCTION OR ERECTION.
       A. 5394                            14
    1    (2)  A  CREDIT SHALL BE ALLOWED UNDER THIS SUBDIVISION WITH RESPECT TO
    2  TANGIBLE PERSONAL PROPERTY AND OTHER TANGIBLE PROPERTY, INCLUDING BUILD-
    3  INGS AND STRUCTURAL COMPONENTS OF BUILDINGS WHICH: (A)  ARE  DEPRECIABLE
    4  PURSUANT  TO  SECTION  ONE  HUNDRED  SIXTY-SEVEN OF THE INTERNAL REVENUE
    5  CODE,  (B) HAVE A USEFUL LIFE OF FOUR YEARS OR MORE, (C) ARE ACQUIRED BY
    6  PURCHASE AS DEFINED IN SECTION  ONE  HUNDRED  SEVENTY-NINE  (D)  OF  THE
    7  INTERNAL  REVENUE CODE, AND (D) ARE (I) PRINCIPALLY USED BY THE TAXPAYER
    8  IN THE PRODUCTION OF GOODS  BY  MANUFACTURING,  PROCESSING,  ASSEMBLING,
    9  REFINING, MINING, EXTRACTING, FARMING, AGRICULTURE, HORTICULTURE, FLORI-
   10  CULTURE, VITICULTURE OR COMMERCIAL FISHING, (II) INDUSTRIAL WASTE TREAT-
   11  MENT  FACILITIES OR AIR POLLUTION CONTROL FACILITIES USED IN THE TAXPAY-
   12  ER'S TRADE OR BUSINESS, (III) RESEARCH AND  DEVELOPMENT  PROPERTY,  (IV)
   13  PRINCIPALLY USED IN THE ORDINARY COURSE OF THE TAXPAYER'S TRADE OR BUSI-
   14  NESS  AS  A  BROKER  OR  DEALER  IN CONNECTION WITH THE PURCHASE OR SALE
   15  (WHICH SHALL INCLUDE BUT NOT BE LIMITED TO THE ISSUANCE, ENTERING  INTO,
   16  ASSUMPTION,  OFFSET,  ASSIGNMENT,  TERMINATION,  OR TRANSFER) OF STOCKS,
   17  BONDS  OR  OTHER  SECURITIES  AS  DEFINED  IN   SECTION   FOUR   HUNDRED
   18  SEVENTY-FIVE(C)(2)  OF  THE  INTERNAL REVENUE CODE, OR OF COMMODITIES AS
   19  DEFINED IN SECTION FOUR HUNDRED SEVENTY-FIVE (E) OF THE INTERNAL REVENUE
   20  CODE, OR (V) PRINCIPALLY USED IN THE ORDINARY COURSE OF  THE  TAXPAYER'S
   21  TRADE  OR BUSINESS OF PROVIDING INVESTMENT ADVISORY SERVICES FOR A REGU-
   22  LATED INVESTMENT COMPANY AS DEFINED IN SECTION EIGHT  HUNDRED  FIFTY-ONE
   23  OF THE INTERNAL REVENUE CODE, OR LENDING, LOAN ARRANGEMENT OR LOAN ORIG-
   24  INATION  SERVICES  TO  CUSTOMERS IN CONNECTION WITH THE PURCHASE OR SALE
   25  (WHICH SHALL INCLUDE BUT NOT BE LIMITED TO THE ISSUANCE, ENTERING  INTO,
   26  ASSUMPTION,  OFFSET, ASSIGNMENT, TERMINATION, OR TRANSFER) OF SECURITIES
   27  AS DEFINED IN SECTION FOUR HUNDRED SEVENTY-FIVE(C)(2)  OF  THE  INTERNAL
   28  REVENUE CODE. FOR PURPOSES OF CLAUSES (IV) AND (V) OF THIS SUBPARAGRAPH,
   29  PROPERTY  PURCHASED  BY  A  TAXPAYER AFFILIATED WITH A REGULATED BROKER,
   30  DEALER OR REGISTERED INVESTMENT ADVISER IS ALLOWED A CREDIT  UNDER  THIS
   31  SUBDIVISION  IF THE PROPERTY IS USED BY ITS AFFILIATED REGULATED BROKER,
   32  DEALER OR REGISTERED INVESTMENT ADVISER IN ACCORDANCE WITH THIS SUBDIVI-
   33  SION. FOR PURPOSES OF DETERMINING IF THE PROPERTY IS PRINCIPALLY USED IN
   34  QUALIFYING USES, THE USES BY THE TAXPAYER DESCRIBED IN CLAUSES (IV)  AND
   35  (V) OF THIS SUBPARAGRAPH MAY BE AGGREGATED. IN ADDITION, THE USES BY THE
   36  TAXPAYER,  ITS  AFFILIATED  REGULATED  BROKER,  DEALER,  AND  REGISTERED
   37  INVESTMENT ADVISER UNDER EITHER OR BOTH OF THOSE CLAUSES MAY  BE  AGGRE-
   38  GATED.  PROVIDED,  HOWEVER,  A  TAXPAYER SHALL NOT BE ALLOWED THE CREDIT
   39  PROVIDED BY CLAUSES (IV) AND (V) OF THIS SUBPARAGRAPH UNLESS (I)  EIGHTY
   40  PERCENT  OR  MORE  OF  THE EMPLOYEES PERFORMING THE   ADMINISTRATIVE AND
   41  SUPPORT FUNCTIONS RESULTING FROM OR RELATED TO THE  QUALIFYING  USES  OF
   42  SUCH  EQUIPMENT ARE LOCATED IN THIS STATE, OR (II) THE AVERAGE NUMBER OF
   43  EMPLOYEES THAT PERFORM THE ADMINISTRATIVE AND SUPPORT FUNCTIONS  RESULT-
   44  ING  FROM  OR  RELATED  TO THE QUALIFYING USES OF SUCH EQUIPMENT AND ARE
   45  LOCATED IN THIS STATE DURING THE TAXABLE YEAR FOR WHICH  THE  CREDIT  IS
   46  CLAIMED  IS  EQUAL TO OR GREATER THAN NINETY-FIVE PERCENT OF THE AVERAGE
   47  NUMBER OF EMPLOYEES THAT PERFORM THESE FUNCTIONS AND ARE LOCATED IN THIS
   48  STATE DURING THE THIRTY-SIX MONTHS IMMEDIATELY PRECEDING  THE  YEAR  FOR
   49  WHICH THE CREDIT IS CLAIMED, OR (III) THE NUMBER OF EMPLOYEES LOCATED IN
   50  THIS  STATE  DURING  THE TAXABLE YEAR FOR WHICH THE CREDIT IS CLAIMED IS
   51  EQUAL TO OR GREATER THAN NINETY  PERCENT  OF  THE  NUMBER  OF  EMPLOYEES
   52  LOCATED  IN  THIS STATE ON DECEMBER THIRTY-FIRST, NINETEEN HUNDRED NINE-
   53  TY-EIGHT OR, IF THE TAXPAYER WAS NOT A CALENDAR YEAR TAXPAYER  IN  NINE-
   54  TEEN HUNDRED NINETY-EIGHT, THE LAST DAY OF ITS FIRST TAXABLE YEAR ENDING
   55  AFTER  DECEMBER  THIRTY-FIRST,  NINETEEN  HUNDRED  NINETY-EIGHT.  IF THE
   56  TAXPAYER BECOMES SUBJECT TO TAX IN THIS STATE  AFTER  THE  TAXABLE  YEAR
       A. 5394                            15
    1  BEGINNING  IN  NINETEEN  HUNDRED  NINETY-EIGHT, THEN THE TAXPAYER IS NOT
    2  REQUIRED TO SATISFY  THE  EMPLOYMENT  TEST  PROVIDED  IN  THE  PRECEDING
    3  SENTENCE  OF  THIS SUBPARAGRAPH FOR ITS FIRST TAXABLE YEAR. FOR PURPOSES
    4  OF  ITEM  (III) OF THIS CLAUSE, THE EMPLOYMENT TEST WILL BE BASED ON THE
    5  NUMBER OF EMPLOYEES LOCATED IN THIS STATE ON THE LAST DAY OF  THE  FIRST
    6  TAXABLE  YEAR  THE TAXPAYER IS SUBJECT TO TAX IN THIS STATE. IF THE USES
    7  OF THE PROPERTY MUST BE AGGREGATED TO DETERMINE WHETHER THE PROPERTY  IS
    8  PRINCIPALLY  USED  IN  QUALIFYING USES, THEN EITHER EACH AFFILIATE USING
    9  THE PROPERTY MUST SATISFY THIS EMPLOYMENT TEST OR THIS  EMPLOYMENT  TEST
   10  MUST  BE  SATISFIED  THROUGH  THE  AGGREGATION  OF  THE EMPLOYEES OF THE
   11  TAXPAYER,  ITS  AFFILIATED  REGULATED  BROKER,  DEALER,  AND  REGISTERED
   12  INVESTMENT ADVISER USING THE PROPERTY. FOR PURPOSES OF THIS SUBDIVISION,
   13  THE  TERM  "GOODS"  SHALL  NOT INCLUDE ELECTRICITY. FOR PURPOSES OF THIS
   14  PARAGRAPH, MANUFACTURING SHALL MEAN THE PROCESS OF WORKING RAW MATERIALS
   15  INTO WARES SUITABLE FOR USE OR WHICH GIVES NEW SHAPES,  NEW  QUALITY  OR
   16  NEW COMBINATION TO MATTER WHICH ALREADY HAS GONE THROUGH SOME ARTIFICIAL
   17  PROCESS  BY  THE  USE  OF MACHINERY, TOOLS, APPLIANCES AND OTHER SIMILAR
   18  EQUIPMENT. PROPERTY USED  IN  THE  PRODUCTION  OF  GOODS  SHALL  INCLUDE
   19  MACHINERY,  EQUIPMENT  OR  OTHER  TANGIBLE PROPERTY WHICH IS PRINCIPALLY
   20  USED IN THE REPAIR AND SERVICE OF OTHER MACHINERY,  EQUIPMENT  OR  OTHER
   21  TANGIBLE  PROPERTY USED PRINCIPALLY IN THE PRODUCTION OF GOODS AND SHALL
   22  INCLUDE ALL FACILITIES USED IN THE PRODUCTION OPERATION, INCLUDING STOR-
   23  AGE OF MATERIAL TO BE USED IN PRODUCTION AND OF THE  PRODUCTS  THAT  ARE
   24  PRODUCED.  FOR  PURPOSES  OF THIS PARAGRAPH, THE TERMS "INDUSTRIAL WASTE
   25  TREATMENT FACILITIES", "AIR POLLUTION CONTROL FACILITIES" AND  "RESEARCH
   26  AND  DEVELOPMENT  PROPERTY"  SHALL HAVE THE MEANINGS ASCRIBED THERETO BY
   27  CLAUSES (II) AND (III), RESPECTIVELY, OF SUBPARAGRAPH (D) OF THIS  PARA-
   28  GRAPH,  AND  THE  PROVISIONS OF SUBPARAGRAPH (C) OF THIS PARAGRAPH SHALL
   29  APPLY.
   30    (3) A TAXPAYER SHALL NOT BE ALLOWED A CREDIT  UNDER  THIS  SUBDIVISION
   31  WITH  RESPECT TO ANY TANGIBLE PERSONAL PROPERTY AND OTHER TANGIBLE PROP-
   32  ERTY, INCLUDING BUILDINGS AND STRUCTURAL COMPONENTS OF BUILDINGS,  WHICH
   33  IT  LEASES  TO  ANY  OTHER PERSON OR CORPORATION EXCEPT WHERE A TAXPAYER
   34  LEASES PROPERTY TO AN AFFILIATED REGULATED BROKER, DEALER, OR REGISTERED
   35  INVESTMENT ADVISER THAT USES SUCH PROPERTY  IN  ACCORDANCE  WITH  CLAUSE
   36  (IV)  OR  (V)  OF SUBPARAGRAPH (D) OF PARAGRAPH TWO OF THIS SUBDIVISION.
   37  FOR PURPOSES OF THE PRECEDING SENTENCE, ANY  CONTRACT  OR  AGREEMENT  TO
   38  LEASE  OR RENT OR FOR A LICENSE TO USE SUCH PROPERTY SHALL BE CONSIDERED
   39  A LEASE. PROVIDED, HOWEVER, IN DETERMINING WHETHER A TAXPAYER  SHALL  BE
   40  ALLOWED  A  CREDIT UNDER THIS SUBDIVISION WITH RESPECT TO SUCH PROPERTY,
   41  ANY ELECTION  MADE  WITH  RESPECT  TO  SUCH  PROPERTY  PURSUANT  TO  THE
   42  PROVISIONS  OF  PARAGRAPH EIGHT OF SUBSECTION (F) OF SECTION ONE HUNDRED
   43  SIXTY-EIGHT OF THE INTERNAL REVENUE  CODE,  AS  SUCH  PARAGRAPH  WAS  IN
   44  EFFECT  FOR  AGREEMENTS  ENTERED  INTO  PRIOR TO JANUARY FIRST, NINETEEN
   45  HUNDRED EIGHTY-FOUR, SHALL BE DISREGARDED.
   46    (4) IF THE AMOUNT OF CREDIT ALLOWED UNDER  THIS  SUBDIVISION  FOR  ANY
   47  TAXABLE  YEAR  SHALL EXCEED THE TAXPAYER'S TAX FOR SUCH YEAR, THE EXCESS
   48  MAY BE CARRIED OVER TO THE FOLLOWING YEAR OR YEARS AND MAY  BE  DEDUCTED
   49  FROM THE TAXPAYER'S TAX FOR SUCH YEAR OR YEARS. ANY REFUND PAID PURSUANT
   50  TO  THIS  PARAGRAPH  SHALL BE DEEMED TO BE A REFUND OF AN OVERPAYMENT OF
   51  TAX AS PROVIDED IN SECTION  SIX  HUNDRED  EIGHTY-SIX  OF  THIS  CHAPTER,
   52  PROVIDED, HOWEVER, THAT NO INTEREST SHALL BE PAID THEREON.
   53    (DD)  DISCOVERY  WAGE  TAX  CREDIT.  (1) A TAXPAYER SHALL BE ALLOWED A
   54  CREDIT, TO BE COMPUTED AS HEREINAFTER PROVIDED, AGAINST THE TAX  IMPOSED
   55  BY  THIS  ARTICLE,  WHERE  THE  TAXPAYER  HAS BEEN CERTIFIED PURSUANT TO
   56  SECTION NINE HUNDRED SEVENTY-TWO  OF  THE  GENERAL  MUNICIPAL  LAW.  THE
       A. 5394                            16
    1  AMOUNT  OF SUCH CREDIT SHALL BE AS PRESCRIBED IN PARAGRAPH THREE OF THIS
    2  SUBDIVISION.
    3    (2)  "DISCOVERY  WAGES" MEANS WAGES PAID BY THE TAXPAYER FOR FULL-TIME
    4  EMPLOYMENT DURING A TAXABLE YEAR, PROVIDED THAT THOSE WAGES ARE PAID  BY
    5  A CERTIFIED BUSINESS AS DEFINED BY THE COMMISSIONER OF ECONOMIC DEVELOP-
    6  MENT AS REQUIRED IN HIS OR HER RESPONSIBILITIES.
    7    (3)  THE  CREDIT  PROVIDED  IN  THIS SUBDIVISION SHALL BE EQUAL TO THE
    8  PRODUCT OF THE GROSS WAGES  PAID  AND  SIX  AND  EIGHTY-FIVE  HUNDREDTHS
    9  PERCENT FOR EACH NET NEW JOB CREATED DURING THE TAXABLE YEAR.
   10    (4)  "NET NEW JOB" SHALL BE DEFINED AS EACH JOB THAT EXCEEDS THE AVER-
   11  AGE NUMBER OF INDIVIDUALS EMPLOYED FULL-TIME  BY  THE  TAXPAYER  IN  THE
   12  PREVIOUS TAXABLE YEAR.
   13    (5) IF THE AMOUNT OF THIS CREDIT AND CARRYOVERS OF SUCH CREDIT ALLOWED
   14  UNDER  THIS SUBDIVISION FOR ANY TAXABLE YEAR SHALL EXCEED THE TAXPAYER'S
   15  TAX FOR SUCH YEAR, THE EXCESS, AS WELL AS ANY  PART  OF  THE  CREDIT  OR
   16  CARRYOVERS  OF  SUCH CREDIT, OR BOTH, WHICH MAY NOT BE DEDUCTED FROM THE
   17  TAX OTHERWISE DUE BY REASON OF PARAGRAPH THREE OF THIS SUBDIVISION,  MAY
   18  BE  CARRIED OVER TO THE FOLLOWING YEAR OR YEARS AND MAY BE DEDUCTED FROM
   19  THE TAXPAYER'S TAX FOR SUCH YEAR OR YEARS.
   20    S 8. This act shall take effect immediately; provided,  however,  that
   21  any  rules and regulations necessary to carry out the provisions of this
   22  act shall be promulgated by the  commissioner  of  economic  development
   23  before such effective date.
   24                                   PART C
   25    Section  1.  The  opening paragraph and subparagraphs (iv) and (vi) of
   26  paragraph (a) of subdivision 1 of section 210 of the tax law, the  open-
   27  ing paragraph and subparagraph (iv) as amended by section 2 of part N of
   28  chapter  60 of the laws of 2007, subparagraph (vi) as amended by section
   29  1 of part C of chapter 56 of the laws of 2011, are amended  to  read  as
   30  follows:
   31    For  taxable years beginning before July first, nineteen hundred nine-
   32  ty-nine, the amount prescribed by this paragraph shall  be  computed  at
   33  the  rate  of nine percent of the taxpayer's entire net income base. For
   34  taxable years beginning after June thirtieth, nineteen  hundred  ninety-
   35  nine  and before July first, two thousand, the amount prescribed by this
   36  paragraph shall be computed at the rate of eight and one-half percent of
   37  the taxpayer's entire net income base. For taxable years beginning after
   38  June thirtieth, two thousand and before July first,  two  thousand  one,
   39  the amount prescribed by this paragraph shall be computed at the rate of
   40  eight  percent  of  the  taxpayer's  entire net income base. For taxable
   41  years beginning after June thirtieth, two thousand one and before  Janu-
   42  ary  first,  two thousand seven, the amount prescribed by this paragraph
   43  shall be computed at the rate of  seven  and  one-half  percent  of  the
   44  taxpayer's  entire  net income base. For taxable years beginning [on or]
   45  after January first, two thousand seven AND BEFORE  JANUARY  FIRST,  TWO
   46  THOUSAND  THIRTEEN,  the  amount  prescribed  by this paragraph shall be
   47  computed at the rate of seven and one-tenth percent  of  the  taxpayer's
   48  entire net income base.  FOR TAXABLE YEARS BEGINNING ON OR AFTER JANUARY
   49  FIRST,  TWO  THOUSAND  THIRTEEN, THE AMOUNT PRESCRIBED BY THIS PARAGRAPH
   50  SHALL BE COMPUTED AT THE RATE  OF  SIX  AND  EIGHTY-FIVE  ONE  HUNDREDTH
   51  PERCENT  OF THE TAXPAYER'S ENTIRE NET INCOME BASE. The taxpayer's entire
   52  net income base shall mean the portion  of  the  taxpayer's  entire  net
   53  income  allocated  within  the state as hereinafter provided, subject to
   54  any modification required by paragraphs (d) and (e) of subdivision three
       A. 5394                            17
    1  of this section. However, in the case of a small business  taxpayer,  as
    2  defined  in  paragraph (f) of this subdivision, the amount prescribed by
    3  this paragraph shall be computed pursuant to subparagraph (iv)  of  this
    4  paragraph  and in the case of a manufacturer, as defined in subparagraph
    5  (vi) of this paragraph, the amount prescribed by this paragraph shall be
    6  computed pursuant to subparagraph (vi) of this paragraph.
    7    (iv) for taxable years beginning [on  or]  after  January  first,  two
    8  thousand  seven  AND BEFORE JANUARY FIRST, TWO THOUSAND THIRTEEN, if the
    9  entire net income base is not more  than  two  hundred  ninety  thousand
   10  dollars  the  amount shall be six and one-half percent of the entire net
   11  income base; if the entire net income base  is  more  than  two  hundred
   12  ninety  thousand  dollars  but  not  over  three hundred ninety thousand
   13  dollars the amount shall be the  sum  of  (1)  eighteen  thousand  eight
   14  hundred  fifty dollars, (2) seven and one-tenth percent of the excess of
   15  the entire net income base over two hundred ninety thousand dollars  but
   16  not  over three hundred ninety thousand dollars and (3) four and thirty-
   17  five hundredths percent of the excess of the entire net income base over
   18  three hundred fifty thousand dollars but not over three  hundred  ninety
   19  thousand dollars. FOR TAXABLE YEARS BEGINNING ON OR AFTER JANUARY FIRST,
   20  TWO  THOUSAND  THIRTEEN,  IF  THE  ENTIRE  NET  INCOME IS NOT OVER THREE
   21  HUNDRED NINETY THOUSAND DOLLARS THE AMOUNT SHALL BE SIX PERCENT  OF  THE
   22  ENTIRE NET INCOME BASE;
   23    (vi)  for  taxable years beginning [on or] after January thirty-first,
   24  two thousand seven, AND BEFORE JANUARY FIRST, TWO  THOUSAND  TWELVE  the
   25  amount  prescribed by this paragraph for a taxpayer which is a qualified
   26  New York manufacturer, shall be computed at the rate of six and one-half
   27  (6.5) percent of the taxpayer's entire  net  income  base.  For  taxable
   28  years  beginning  on  or  after  January  first, two thousand twelve and
   29  before January  first,  two  thousand  [fifteen]  THIRTEEN,  the  amount
   30  prescribed  by this paragraph for a taxpayer which is an eligible quali-
   31  fied New York manufacturer shall be computed at the rate  of  three  and
   32  one-quarter  (3.25)  percent  of  the taxpayer's entire net income base.
   33  FOR TAXABLE YEARS BEGINNING ON AND AFTER  JANUARY  FIRST,  TWO  THOUSAND
   34  THIRTEEN,  THE  AMOUNT PRESCRIBED BY THIS PARAGRAPH SHALL BE COMPUTED AT
   35  THE RATE OF SIX PERCENT OF THE TAXPAYER'S ENTIRE NET  INCOME  BASE.  The
   36  term  "manufacturer" shall mean a taxpayer which during the taxable year
   37  is principally engaged in the  production  of  goods  by  manufacturing,
   38  processing,  assembling, refining, mining, extracting, farming, agricul-
   39  ture, horticulture, floriculture,  viticulture  or  commercial  fishing.
   40  However,  the  generation  and distribution of electricity, the distrib-
   41  ution of natural gas, and the production of steam  associated  with  the
   42  generation  of  electricity  shall  not  be  qualifying activities for a
   43  manufacturer under this subparagraph. Moreover, the combined group shall
   44  be considered a "manufacturer" for purposes of this subparagraph only if
   45  the combined group during the taxable year is principally engaged in the
   46  activities set forth in this paragraph, or any  combination  thereof.  A
   47  taxpayer  or  a  combined group shall be "principally engaged" in activ-
   48  ities described above if, during  the  taxable  year,  more  than  fifty
   49  percent of the gross receipts of the taxpayer or combined group, respec-
   50  tively,  are  derived  from  receipts from the sale of goods produced by
   51  such activities. In computing a combined group's gross receipts,  inter-
   52  corporate  receipts  shall be eliminated. A "qualified New York manufac-
   53  turer" is a manufacturer  which  has  property  in  New  York  which  is
   54  described in clause (A) of subparagraph (i) of paragraph (b) of subdivi-
   55  sion  twelve  of  this section and either (I) the adjusted basis of such
   56  property for federal income tax purposes at the  close  of  the  taxable
       A. 5394                            18
    1  year  is  at  least  one  million  dollars  or  (II) all of its real and
    2  personal property is located in New York. In addition, a "qualified  New
    3  York  manufacturer"  means  a  taxpayer  which is defined as a qualified
    4  emerging  technology  company  under paragraph (c) of subdivision one of
    5  section thirty-one hundred two-e of the public authorities  law  regard-
    6  less  of the ten million dollar limitation expressed in subparagraph one
    7  of such paragraph (c). The commissioner shall establish  guidelines  and
    8  criteria  that specify requirements by which a manufacturer may be clas-
    9  sified as an eligible qualified  New  York  manufacturer.  Criteria  may
   10  include but not be limited to factors such as regional unemployment, the
   11  economic  impact  that  manufacturing  has on the surrounding community,
   12  population decline within the region and median income within the region
   13  in which the manufacturer is located. In establishing  these  guidelines
   14  and criteria, the commissioner shall endeavor that the total annual cost
   15  of the lower rates shall not exceed twenty-five million dollars.
   16    S  2.  Subsection  (a)  of  section 1455 of the tax law, as amended by
   17  section 3 of part N of chapter 60 of the laws of  2007,  is  amended  to
   18  read as follows:
   19    (a)  Basic  tax.  For  taxable  years beginning before July first, two
   20  thousand, nine percent of the  taxpayer's  entire  net  income,  or  the
   21  portion  thereof  allocated to this state, for the taxable year, or part
   22  thereof. For taxable years beginning after June thirtieth, two  thousand
   23  and  before  July first, two thousand one, eight and one-half percent of
   24  the taxpayer's entire net income, or portion thereof allocated  to  this
   25  state,  for  the taxable year, or part thereof. For taxable years begin-
   26  ning after June thirtieth, two thousand one and before July  first,  two
   27  thousand  two,  eight  percent  of  the taxpayer's entire net income, or
   28  portion thereof allocated to this state, for the taxable year,  or  part
   29  thereof.  For taxable years beginning after June thirtieth, two thousand
   30  two and before January first, two thousand  seven,  seven  and  one-half
   31  percent  of  the  taxpayer's entire net income, or portion thereof allo-
   32  cated to this state, for the taxable year, or part thereof. For  taxable
   33  years  beginning  on  [or  after] January first, two thousand seven, AND
   34  BEFORE JANUARY FIRST, TWO THOUSAND THIRTEEN, seven and one-tenth percent
   35  of the taxpayer's entire net income, or the portion thereof allocated to
   36  this state, for the taxable year, or part  thereof.  FOR  TAXABLE  YEARS
   37  BEGINNING  ON  OR  AFTER  JANUARY  FIRST, TWO THOUSAND THIRTEEN, SIX AND
   38  EIGHTY-FIVE ONE HUNDREDTH PERCENT OF THE TAXPAYER'S ENTIRE  NET  INCOME,
   39  OR  PORTION  THEREOF  ALLOCATED  TO THIS STATE, FOR THE TAXABLE YEAR, OR
   40  PART THEREOF.
   41    S 3. Paragraph 1 of subdivision (a) of section 1502 of the tax law, as
   42  amended by section 4 of part N of chapter 60 of the  laws  of  2007,  is
   43  amended to read as follows:
   44    (1)  for taxable years beginning before July first, two thousand, nine
   45  percent of the taxpayer's entire net income, or  portion  thereof  allo-
   46  cated  within  this state, for the taxable year, or part thereof, except
   47  that for taxable  years  beginning  prior  to  January  first,  nineteen
   48  hundred  seventy-eight,  the rate shall be four and five-tenths percent;
   49  for taxable years beginning  after  June  thirtieth,  two  thousand  and
   50  before  July  first, two thousand one, eight and one-half percent of the
   51  taxpayer's entire net income, or portion thereof allocated  within  this
   52  state,  for  the taxable year, or part thereof; for taxable years begin-
   53  ning after June thirtieth, two thousand one and before July  first,  two
   54  thousand  two,  eight  percent  of  the taxpayer's entire net income, or
   55  portion thereof allocated within this state, for the  taxable  year,  or
   56  part  thereof;  for  taxable  years  beginning after June thirtieth, two
       A. 5394                            19
    1  thousand two and before January first, two  thousand  seven,  seven  and
    2  one-half percent of the taxpayer's entire net income, or portion thereof
    3  allocated  within  this  state,  for  the taxable year, or part thereof;
    4  [and] for taxable years beginning [on or] after January first, two thou-
    5  sand  seven  AND  BEFORE JANUARY FIRST, TWO THOUSAND THIRTEEN, seven and
    6  one-tenth percent of the taxpayer's entire net income, or portion there-
    7  of allocated within this state, for the taxable year, or  part  thereof;
    8  AND  FOR TAXABLE YEARS BEGINNING ON OR AFTER JANUARY FIRST, TWO THOUSAND
    9  THIRTEEN, SIX AND EIGHTY-FIVE ONE HUNDREDTH PERCENT  OF  THE  TAXPAYER'S
   10  ENTIRE  NET  INCOME, OR PORTION THEREOF ALLOCATED WITHIN THIS STATE, FOR
   11  THE TAXABLE YEAR, OR PART THEREOF; or
   12    S 4. Subparagraph 1 of paragraph (b) of subdivision 1 of section 186-a
   13  of the tax law, as amended by section 4 of part Y of chapter 63  of  the
   14  laws of 2000, is amended to read as follows:
   15    (1)  two and five-tenths percent on and after January first, two thou-
   16  sand through December thirty-first, two thousand, two and forty-five one
   17  hundredths percent from January first, two thousand one through December
   18  thirty-first, two thousand one, two and four-tenths percent from January
   19  first, two thousand two through December thirty-first, two thousand two,
   20  two and twenty-five one hundredths percent from January first, two thou-
   21  sand three through December thirty-first, two thousand  three,  two  and
   22  one  hundred twenty-five one thousandths percent from January first, two
   23  thousand four through December thirty-first, two  thousand  four  [and],
   24  two  percent  commencing  January  first,  two thousand five AND ONE AND
   25  ONE-HALF PERCENT COMMENCING JANUARY FIRST,  TWO  THOUSAND  THIRTEEN  and
   26  thereafter  of  that portion of its gross income derived from the trans-
   27  portation, transmission or distribution of gas or electricity  by  means
   28  of  conduits,  mains,  pipes,  wires,  lines or the like and (2) two and
   29  one-tenth percent from January  first,  two  thousand  through  December
   30  thirty-first, two thousand, two percent from January first, two thousand
   31  one through December thirty-first, two thousand one, one and nine-tenths
   32  percent  from  January  first, two thousand two through December thirty-
   33  first, two thousand two, eighty-five one hundredths of one percent  from
   34  January  first,  two  thousand  three through December thirty-first, two
   35  thousand three, four-tenths of one percent from January first, two thou-
   36  sand four through December thirty-first,  two  thousand  four  and  zero
   37  percent  commencing January first, two thousand five of all of its other
   38  gross income, is hereby imposed upon every utility not taxed under para-
   39  graph (a) of this subdivision doing business  in  this  state  which  is
   40  subject  to  the  supervision  of the state department of public service
   41  which has a gross income for the year ending  December  thirty-first  in
   42  excess of five hundred dollars, except motor carriers or brokers subject
   43  to such supervision under the public service law; and
   44    S  5.  Paragraph (a) of subdivision 2 of section 186-e of the tax law,
   45  as amended by section 4 of part S of chapter 85 of the laws of 2002,  is
   46  amended to read as follows:
   47    (a)  There is hereby imposed an excise tax on the sale of telecommuni-
   48  cation services by any person which is a provider  of  telecommunication
   49  services,  to  be paid by such person, at the rate of three and one-half
   50  percent prior to October first, nineteen hundred ninety-eight, three and
   51  one-quarter percent from October first,  nineteen  hundred  ninety-eight
   52  through  December  thirty-first, nineteen hundred ninety-nine, [and] two
   53  and one-half percent [on and] after January first, two thousand FIVE AND
   54  TWO PERCENT ON AND AFTER JANUARY FIRST, TWO THOUSAND THIRTEEN  of  gross
   55  receipt  from: (1) any intrastate telecommunication services, except any
   56  telecommunication services the gross receipt from which  is  subject  to
       A. 5394                            20
    1  tax  under  subparagraph  four of this paragraph; (2) any interstate and
    2  international telecommunication  services  (other  than  interstate  and
    3  international  private  telecommunication  services and any telecommuni-
    4  cation  services  the  gross  receipt from which is subject to tax under
    5  subparagraph four of this paragraph) which  originate  or  terminate  in
    6  this state and which telecommunication services are charged to a service
    7  address  in this state, regardless of where the amounts charged for such
    8  services are billed or ultimately paid; (3) interstate and international
    9  private telecommunication services, the gross receipt to which  the  tax
   10  shall  apply  shall  be determined as prescribed in subdivision three of
   11  this section, except any telecommunication services  the  gross  receipt
   12  from  which is subject to tax under subparagraph four of this paragraph;
   13  and (4) mobile telecommunications service provided  by  a  home  service
   14  provider where the mobile telecommunications customer's place of primary
   15  use is within this state.
   16    S  6.  Subparagraph 1 of paragraph (g) of subdivision 1 of section 210
   17  of the tax law, as amended by section 4 of part AA-1 of  chapter  57  of
   18  the laws of 2008, is amended to read as follows:
   19    (1)  General. The amount prescribed by this paragraph shall be, in the
   20  case of each New York S corporation,  (i)  the  higher  of  the  amounts
   21  prescribed in paragraphs (a) and (d) of this subdivision (other than the
   22  amount  prescribed in the final clause of subparagraph one of that para-
   23  graph (d)) (ii)  reduced  by  the  article  twenty-two  tax  equivalent;
   24  provided,  however,  that  the  amount thus determined shall not be less
   25  than the lowest of the amounts prescribed in subparagraph  one  of  that
   26  paragraph  (d)  (applying  the  provisions of subparagraph three of that
   27  paragraph  as  necessary).  Provided,   however,   notwithstanding   any
   28  provision  of this paragraph, in taxable years beginning in two thousand
   29  three and before two thousand eight, the amount prescribed by this para-
   30  graph shall be the amount prescribed in subparagraph one of  that  para-
   31  graph  (d)  (applying the provisions of subparagraph three of that para-
   32  graph as necessary) and applying the calculation of that amount  in  the
   33  case  of  a  termination  year as set forth in subparagraph four of this
   34  paragraph as necessary. In taxable years beginning in two thousand eight
   35  [and thereafter], the amount prescribed by this paragraph is the  amount
   36  prescribed  in  subparagraph  four  of  that paragraph (d) (applying the
   37  provisions of subparagraph three of that  paragraph  as  necessary)  and
   38  applying  the  calculation  of  that amount in the case of a termination
   39  year as set forth in subparagraph four of this paragraph  as  necessary.
   40  PROVIDED,  FURTHER, AND NOTWITHSTANDING ANY PROVISION OF THIS PARAGRAPH,
   41  IN TAXABLE YEARS BEGINNING ON  AND  AFTER  TWO  THOUSAND  THIRTEEN,  THE
   42  AMOUNT PRESCRIBED BY THIS PARAGRAPH SHALL EQUAL ZERO, BUT THE PROVISIONS
   43  OF  THIS  PARAGRAPH SHALL HAVE NO EFFECT ON THE AMOUNT PRESCRIBED BY THE
   44  ARTICLE TWENTY-TWO TAX EQUIVALENT.
   45    S 7. This act shall take effect immediately and shall apply to taxable
   46  years beginning on or after January 1, 2013, provided, however, that any
   47  rules and regulations necessary to carry out the provisions of this  act
   48  shall be promulgated before such effective date.
   49    S 2. Severability clause. If any clause, sentence, paragraph, subdivi-
   50  sion,  section  or  part  of  this act shall be adjudged by any court of
   51  competent jurisdiction to be invalid, such judgment  shall  not  affect,
   52  impair,  or  invalidate  the remainder thereof, but shall be confined in
   53  its operation to the clause, sentence, paragraph,  subdivision,  section
   54  or part thereof directly involved in the controversy in which such judg-
   55  ment shall have been rendered. It is hereby declared to be the intent of
       A. 5394                            21
    1  the  legislature  that  this  act  would  have been enacted even if such
    2  invalid provisions had not been included herein.
    3    S  3.  This act shall take effect immediately, provided, however, that
    4  the applicable effective date of Parts A through C of this act shall  be
    5  as specifically set forth in the last section of such Parts.
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