Bill Text: NY S03389 | 2023-2024 | General Assembly | Introduced
Bill Title: Limits the use of fossil fuels in the research or production of energy for purposes of the excelsior jobs program; prohibits businesses engaged in the production, transmission, distribution, transportation or storage of fossil fuels from participation in the START-UP NY program; eliminates property that directly produces, transmits, distributes, transports or stores fossil fuels from qualifying tangible property for purposes of the investment tax credit and the Brownfield redevelopment tax credit; relates to tax on sales of motor fuel and petroleum products and makes conforming changes; relates to the definition of qualified rehabilitation expenditures for purposes of the tax credit for rehabilitation of historic properties; relates to the definition of a qualified emerging technology company; relates to the definition of manufacturer for purposes of the calculation of special tax benefits for qualified New York manufacturers; repeals provisions relating to manufacturing gallonage for purposes of the imposition of certain taxes; repeals provisions relating to reimbursement; repeals provisions relating to a utility credit or reimbursement; repeals provisions relating to an aviation fuel business which services four or more cities; repeals provisions relating to services rendered with respect to certain property; repeals provisions relating to fuel sold to an airline for use in its airplanes.
Spectrum: Partisan Bill (Democrat 21-0)
Status: (Introduced) 2024-01-03 - REFERRED TO COMMERCE, ECONOMIC DEVELOPMENT AND SMALL BUSINESS [S03389 Detail]
Download: New_York-2023-S03389-Introduced.html
STATE OF NEW YORK ________________________________________________________________________ 3389 2023-2024 Regular Sessions IN SENATE January 31, 2023 ___________ Introduced by Sens. KRUEGER, CLEARE, GOUNARDES, HOYLMAN-SIGAL, JACKSON, MAY, MYRIE, RAMOS, RIVERA, SALAZAR, STAVISKY -- read twice and ordered printed, and when printed to be committed to the Committee on Commerce, Economic Development and Small Business AN ACT to amend the economic development law and the public service law, in relation to limiting the use of fossil fuels in the research or production of energy for purposes of the excelsior jobs program; to amend the economic development law, in relation to prohibiting busi- nesses engaged in the production, transmission, distribution, trans- portation or storage of fossil fuels from participation in the START- UP NY program; to amend the tax law, in relation to eliminating property that directly produces, transmits, distributes, transports or stores fossil fuels from qualifying tangible property for purposes of the investment tax credit and the Brownfield redevelopment tax credit; to amend the tax law, in relation to tax on sales of motor fuel and petroleum products and to make conforming changes; to amend the tax law, in relation to the definition of qualified rehabilitation expend- itures for purposes of the tax credit for rehabilitation of historic properties; to amend the public authorities law, in relation to the definition of a qualified emerging technology company; to amend the tax law, in relation to the definition of manufacturer for purposes of the calculation of special tax benefits for qualified New York manufacturers; to repeal paragraph 3 of subdivision (f) and paragraph 4 of subdivision (g) of section 301-a of the tax law relating to manu- facturing gallonage for purposes of the imposition of certain taxes; to repeal subdivisions (i), (j), and (l) of section 301-c of the tax law relating to reimbursement; to repeal section 301-d of the tax law relating to a utility credit or reimbursement; to repeal subdivision (f) of section 301-e of the tax law relating to an aviation fuel business which services four or more cities; to repeal subparagraph (xi) of paragraph 3 of subdivision (c) of section 1105 of the tax law relating to services rendered with respect to certain property; and to repeal paragraph 9 of subdivision (a) of section 1115 EXPLANATION--Matter in italics (underscored) is new; matter in brackets [] is old law to be omitted. LBD08180-02-3S. 3389 2 of the tax law relating to fuel sold to an airline for use in its airplanes The People of the State of New York, represented in Senate and Assem- bly, do enact as follows: 1 Section 1. Short title. This act shall be known and may be cited as 2 the "Stop Climate Polluter Handouts Act". 3 § 2. Subdivisions 17, 18, 21, and 22 of section 352 of the economic 4 development law, subdivisions 17, 18 and 21 as amended by section 1 of 5 part K of chapter 59 of the laws of 2017, subdivision 18 as separately 6 amended by section 1 of part ZZ of chapter 59 of the laws of 2017, 7 subdivision 22 as amended by chapter 572 of the laws of 2022, are 8 amended to read as follows: 9 17. "Qualified investment" means an investment in tangible property 10 (including a building or a structural component of a building) owned by 11 a business enterprise which: 12 (a) is depreciable pursuant to section one hundred sixty-seven of the 13 internal revenue code; 14 (b) has a useful life of four years or more; 15 (c) is acquired by purchase as defined in section one hundred seven- 16 ty-nine (d) of the internal revenue code; 17 (d) does not directly produce, transmit, distribute, transport, or 18 store fossil fuels or directly utilize fossil fuels for the production 19 of on-site energy, including thermal energy, for any purpose. For the 20 purposes of this article, fossil fuel shall have the same definition as 21 in section 1-103 of the energy law; 22 (e) has a situs in this state; and 23 [(e)] (f) is placed in service in the state on or after the date the 24 certificate of eligibility is issued to the business enterprise. 25 18. "Regionally significant project" means (a) a manufacturer creating 26 at least ten net new jobs in the state and making significant capital 27 investment in the state; (b) a business creating at least ten net new 28 jobs in agriculture in the state and making significant capital invest- 29 ment in the state, (c) a financial services firm, distribution center, 30 or back office operation creating at least one hundred net new jobs in 31 the state and making significant capital investment in the state, (d) a 32 scientific research and development firm creating at least ten net new 33 jobs in the state, and making significant capital investment in the 34 state, (e) a life sciences company creating at least twenty net new jobs 35 in the state and making significant capital investment in the state or 36 (f) an entertainment company creating or obtaining at least two hundred 37 net new jobs in the state and making significant capital investment in 38 the state. Other businesses creating one hundred fifty or more net new 39 jobs in the state and making significant capital investment in the state 40 may be considered eligible as a regionally significant project by the 41 commissioner as well. A regionally significant project shall not be 42 engaged in the production, transmission, distribution, transportation, 43 storage, sale, purchase, or delivery of fossil fuels. The commissioner 44 shall promulgate regulations pursuant to section three hundred fifty-six 45 of this article to determine what additional criteria a business must 46 meet to be eligible as a regionally significant project, including, but 47 not limited to, whether a business exports a substantial portion of its 48 products or services outside of the state or outside of a metropolitan 49 statistical area or county within the state.S. 3389 3 1 21. "Research and development expenditures" mean the expenses of the 2 business enterprise that are qualified research expenses under the 3 federal research and development credit under section forty-one of the 4 internal revenue code and are attributable to activities conducted in 5 the state. If the federal research and development credit has expired, 6 then the research and development expenditures shall be calculated as if 7 the federal research and development credit structure and definition in 8 effect in federal tax year two thousand nine were still in effect. 9 Research and development expenditures does not include any expenses for 10 tangible personal property that directly produces, transmits, distrib- 11 utes, transports, or stores fossil fuels or directly utilizes fossil 12 fuels for the production of on-site energy, including thermal energy, 13 for any purpose. 14 22. "Scientific research and development" means conducting research 15 and experimental development in the physical, engineering, and life 16 sciences, including but not limited to agriculture, animal fiber, elec- 17 tronics, environmental, biology, botany, biotechnology, computers, chem- 18 istry, food, fisheries, forests, geology, health, mathematics, medicine, 19 oceanography, pharmacy, physics, plant fiber, veterinary, and other 20 allied subjects. For the purposes of this article, scientific research 21 and development does not include medical or veterinary laboratory test- 22 ing facilities, or any research that contributes to the production, 23 transmission, distribution, transportation, storage, sale, purchase, or 24 delivery of fossil fuels. 25 § 3. Subdivision 7 of section 355 of the economic development law, as 26 amended by chapter 494 of the laws of 2022, is amended to read as 27 follows: 28 7. For availability of special excelsior jobs program rates governing 29 the provision of [gas or] electric service, see subdivision twelve-d of 30 section sixty-six of the public service law. Such special excelsior jobs 31 program rates may remain available to participants as defined in this 32 article for a period of up to ten years commencing in the first taxable 33 year that the participant receives a certificate of tax credit, or the 34 first taxable year listed on its preliminary schedule of benefits, 35 whichever is later. Notwithstanding any other provision of this section, 36 such special excelsior job program rates shall remain available to a 37 Green CHIPS project which enters into a phase two of such project for 38 the entirety of both of its schedules of benefits. Provided however, if 39 a participant is removed from the excelsior jobs program pursuant to 40 this article, the excelsior jobs program rates may be denied. 41 § 4. Subdivision 12-d of section 66 of the public service law, as 42 added by section 8 of part G of chapter 61 of the laws of 2011, is 43 amended to read as follows: 44 12-d. Notwithstanding any other provision of law, upon application of 45 [a gas or] an electric corporation, the commission shall authorize such 46 corporation to charge a special excelsior jobs program rate equal to the 47 incremental cost of providing electric service to participants in the 48 excelsior jobs program as defined in article seventeen of the economic 49 development law. 50 § 5. Subdivision 2 of section 433 of the economic development law, as 51 added by section 1 of part A of chapter 68 of the laws of 2013, is 52 amended to read as follows: 53 2. The following types of businesses are prohibited from participating 54 in the START-UP NY program. 55 (a) retail and wholesale businesses; 56 (b) restaurants;S. 3389 4 1 (c) real estate brokers; 2 (d) law firms; 3 (e) medical or dental practices; 4 (f) real estate management companies; 5 (g) hospitality; 6 (h) finance and financial services; 7 (i) businesses providing personal services; 8 (j) businesses providing business administrative or support services, 9 unless such business has received permission from the commissioner to 10 apply to participate in the START-UP NY program upon demonstration that 11 the business would create no fewer than one hundred net new jobs in the 12 tax-free NY area; 13 (k) accounting firms; 14 (l) businesses providing utilities; [and] 15 (m) businesses engaged in the generation or distribution of electric- 16 ity, the distribution of natural gas, or the production of steam associ- 17 ated with the generation of electricity; and 18 (n) businesses engaged in the production, transmission, distribution, 19 transportation, or storage of fossil fuels as defined in section 1-103 20 of the energy law. 21 § 6. Subparagraph (i) of paragraph (b) of subdivision 1 of section 22 210-B of the tax law, as amended by section 2 of part P of chapter 59 of 23 the laws of 2017, is amended to read as follows: 24 (i) A credit shall be allowed under this subdivision with respect to 25 tangible personal property and other tangible property, including build- 26 ings and structural components of buildings, which are: depreciable 27 pursuant to section one hundred sixty-seven of the internal revenue 28 code, have a useful life of four years or more, are acquired by purchase 29 as defined in section one hundred seventy-nine (d) of the internal 30 revenue code, have a situs in this state and are (A) principally used by 31 the taxpayer in the production of goods by manufacturing, processing, 32 assembling, refining, mining, extracting, farming, agriculture, horti- 33 culture, floriculture, viticulture or commercial fishing, (B) industrial 34 waste treatment facilities or air pollution control facilities, used in 35 the taxpayer's trade or business, (C) research and development property, 36 or (D) principally used in the ordinary course of the taxpayer's trade 37 or business as a broker or dealer in connection with the purchase or 38 sale (which shall include but not be limited to the issuance, entering 39 into, assumption, offset, assignment, termination, or transfer) of 40 stocks, bonds or other securities as defined in section four hundred 41 seventy-five (c)(2) of the Internal Revenue Code, or of commodities as 42 defined in section four hundred seventy-five (e) of the Internal Revenue 43 Code, (E) principally used in the ordinary course of the taxpayer's 44 trade or business of providing investment advisory services for a regu- 45 lated investment company as defined in section eight hundred fifty-one 46 of the Internal Revenue Code, or lending, loan arrangement or loan orig- 47 ination services to customers in connection with the purchase or sale 48 (which shall include but not be limited to the issuance, entering into, 49 assumption, offset, assignment, termination, or transfer) of securities 50 as defined in section four hundred seventy-five (c)(2) of the Internal 51 Revenue Code, (F) principally used in the ordinary course of the taxpay- 52 er's business as an exchange registered as a national securities 53 exchange within the meaning of sections 3(a)(1) and 6(a) of the Securi- 54 ties Exchange Act of 1934 or a board of trade as defined in subparagraph 55 one of paragraph (a) of section fourteen hundred ten of the not-for-pro- 56 fit corporation law or as an entity that is wholly owned by one or moreS. 3389 5 1 such national securities exchanges or boards of trade and that provides 2 automation or technical services thereto, or (G) principally used as a 3 qualified film production facility including qualified film production 4 facilities having a situs in an empire zone designated as such pursuant 5 to article eighteen-B of the general municipal law, where the taxpayer 6 is providing three or more services to any qualified film production 7 company using the facility, including such services as a studio lighting 8 grid, lighting and grip equipment, multi-line phone service, broadband 9 information technology access, industrial scale electrical capacity, 10 food services, security services, and heating, ventilation and air 11 conditioning. For purposes of clauses (D), (E) and (F) of this subpara- 12 graph, property purchased by a taxpayer affiliated with a regulated 13 broker, dealer, registered investment advisor, national securities 14 exchange or board of trade, is allowed a credit under this subdivision 15 if the property is used by its affiliated regulated broker, dealer, 16 registered investment advisor, national securities exchange or board of 17 trade in accordance with this subdivision. For purposes of determining 18 if the property is principally used in qualifying uses, the uses by the 19 taxpayer described in clauses (D) and (E) of this subparagraph may be 20 aggregated. In addition, the uses by the taxpayer, its affiliated regu- 21 lated broker, dealer and registered investment advisor under either or 22 both of those clauses may be aggregated. Provided, however, a taxpayer 23 shall not be allowed the credit provided by clauses (D), (E) and (F) of 24 this subparagraph unless the property is first placed in service before 25 October first, two thousand fifteen and (i) eighty percent or more of 26 the employees performing the administrative and support functions 27 resulting from or related to the qualifying uses of such equipment are 28 located in this state or (ii) the average number of employees that 29 perform the administrative and support functions resulting from or 30 related to the qualifying uses of such equipment and are located in this 31 state during the taxable year for which the credit is claimed is equal 32 to or greater than ninety-five percent of the average number of employ- 33 ees that perform these functions and are located in this state during 34 the thirty-six months immediately preceding the year for which the cred- 35 it is claimed, or (iii) the number of employees located in this state 36 during the taxable year for which the credit is claimed is equal to or 37 greater than ninety percent of the number of employees located in this 38 state on December thirty-first, nineteen hundred ninety-eight or, if the 39 taxpayer was not a calendar year taxpayer in nineteen hundred ninety- 40 eight, the last day of its first taxable year ending after December 41 thirty-first, nineteen hundred ninety-eight. If the taxpayer becomes 42 subject to tax in this state after the taxable year beginning in nine- 43 teen hundred ninety-eight, then the taxpayer is not required to satisfy 44 the employment test provided in the preceding sentence of this subpara- 45 graph for its first taxable year. For purposes of clause (iii) of this 46 subparagraph the employment test will be based on the number of employ- 47 ees located in this state on the last day of the first taxable year the 48 taxpayer is subject to tax in this state. If the uses of the property 49 must be aggregated to determine whether the property is principally used 50 in qualifying uses, then either each affiliate using the property must 51 satisfy this employment test or this employment test must be satisfied 52 through the aggregation of the employees of the taxpayer, its affiliated 53 regulated broker, dealer, and registered investment adviser using the 54 property. For purposes of clause (A) of this subparagraph, tangible 55 personal property and other tangible property shall not include property 56 principally used by the taxpayer in the production or distribution ofS. 3389 6 1 electricity, natural gas after extraction from wells, steam, or water 2 delivered through pipes and mains. For purposes of this subdivision, 3 tangible personal property and other tangible property does not include 4 property that directly produces, transmits, distributes, transports, or 5 stores fossil fuels as defined in section 1-103 of the energy law, or 6 directly utilizes fossil fuels for the production of on-site energy, 7 including thermal energy, for any purpose. 8 § 7. Subdivision (m) of section 301-a of the tax law, as added by 9 section 20 of part K of chapter 61 of the laws of 2011, is amended to 10 read as follows: 11 (m) Special rate adjustment for certain vessels. Notwithstanding any 12 provision of this section to the contrary, the use of non-highway diesel 13 motor fuel in the engine of a vessel to propel such vessel shall be 14 subject to tax at the motor fuel and highway diesel motor fuel rate 15 provided for in this section, and shall be subject to the provisions of 16 section three hundred one-j of this article, including the adjustment 17 set forth in paragraph [four] three of subdivision (a) of such section 18 three hundred one-j. A credit or refund shall be available to the extent 19 tax paid on gallonage used to propel any such vessel exceeds the amount 20 of tax due based on the tax rate set forth herein. Provided, however, 21 that the commissioner shall require such documentary proof to qualify 22 for any credit or reimbursement provided hereunder as the commissioner 23 deems appropriate. 24 § 8. Paragraph 3 of subdivision (f) and paragraph 4 of subdivision (g) 25 of section 301-a of the tax law are REPEALED. 26 § 9. Subdivisions (a) and (d) of section 301-b of the tax law, subdi- 27 vision (a) as added by chapter 190 of the laws of 1990, paragraph 5 of 28 subdivision (a) as amended by section 3 of part E of chapter 59 of the 29 laws of 2012, paragraphs 6, 7 and 8 of subdivision (a) as added by 30 section 4 of part W-1 of chapter 109 of the laws of 2006, and subdivi- 31 sion (d) as amended by section 21 of part K of chapter 61 of the laws of 32 2011, are amended to read as follows: 33 (a) Products. (1) [Kerosene sold or used by a petroleum business which34is registered under article twelve-A of this chapter as a distributor of35diesel motor fuel so long as (i) such product has not been blended or36mixed with any other product constituting diesel motor fuel or motor37fuel or a residual petroleum product and (ii) such product is not used38by the petroleum business as fuel to operate a motor vehicle or sold by39such petroleum business to a consumer for use as fuel to operate a motor40vehicle.41(2) Kero-jet fuel (i) sold by a petroleum business which is registered42under article twelve-A of this chapter as a distributor of diesel motor43fuel to a consumer for use exclusively as jet aircraft fuel or to a44petroleum business registered under such article twelve-A as a "distrib-45utor of kero-jet fuel only" where such fixed base operator is engaged46solely in making or offering to make retail sales not in bulk of kero-47jet fuel directly into the fuel tank of an airplane for the purpose of48operating such airplane, (ii) used by a petroleum business, registered49under article twelve-A of this chapter as a distributor of diesel motor50fuel, exclusively as jet aircraft fuel, or (iii) sold at retail not in51bulk by a petroleum business registered under article twelve-A of this52chapter as a "distributor of kero-jet fuel only" where such fuel is53delivered directly into the fuel tank of a jet airplane for use in the54operation of such airplane.55(3)] Aviation gasoline, meeting the specifications set forth in Ameri- 56 can Standard Testing Material Specification D910 or Military Specifica-S. 3389 7 1 tion MIL-G-5572, which is imported or caused to be imported into this 2 state by a petroleum business which is registered under article twelve-A 3 of this chapter as a distributor of motor fuel or produced, refined, 4 manufactured or compounded in this state by such a petroleum business. 5 [(4) Residual petroleum product sold by a petroleum business regis-6tered under this article as a residual petroleum product business if7such product is sold by such petroleum business to a consumer for use8exclusively as bunker fuel for vessels or if such product is used by9such petroleum business exclusively as bunker fuel in its own vessels.10(5) Liquefied petroleum gases, such as butane, ethane or propane.11(6)] (2) E85 imported or caused to be imported into this state or 12 produced, refined, manufactured or compounded in this state by a petro- 13 leum business registered under article twelve-A of this chapter, as a 14 distributor of motor fuel, and then sold by such petroleum business and 15 delivered to a filling station and placed in a storage tank of such 16 filling station for such E85 to be dispensed directly into a motor vehi- 17 cle for use in the operation of such vehicle. 18 [(7)] (i) Partial B20 exemption. B20 imported or caused to be imported 19 into this state or produced, refined, manufactured or compounded in this 20 state by a petroleum business registered under article twelve-A of this 21 chapter, as a distributor of diesel motor fuel, and then sold by such 22 petroleum business. 23 (ii) Calculation of partial exemption. The amount of the partial 24 exemption under this paragraph shall be determined by multiplying the 25 quantity of B20 times twenty percent of the applicable taxes otherwise 26 imposed by this article on such fuel. 27 [(8)] (3) CNG or hydrogen. 28 (d) Sales to consumers for heating purposes. [(1)] Total residential 29 heating exemption. Non-highway diesel motor fuel sold by a petroleum 30 business registered under article twelve-A of this chapter as a distrib- 31 utor of diesel motor fuel or residual petroleum product sold by a petro- 32 leum business registered under this article as a residual petroleum 33 product business to the consumer exclusively for residential heating 34 purposes only if such non-highway diesel motor fuel is delivered into a 35 storage tank which is not equipped with a hose or other apparatus by 36 which such fuel can be dispensed into the fuel tank of a motor vehicle 37 and such storage tank is attached to the heating unit burning such fuel. 38 [(2) Partial non-residential heating exemption. (A) Non-highway diesel39motor fuel sold by a petroleum business registered under article40twelve-A of this chapter as a distributor of diesel motor fuel or resi-41dual petroleum product sold by a petroleum business registered under42this article as a residual petroleum product business to the consumer43exclusively for heating, other than residential heating purposes only if44such non-highway diesel motor fuel is delivered into a storage tank45which is not equipped with a hose or other apparatus by which such fuel46can be dispensed into the fuel tank of a motor vehicle and such storage47tank is attached to the heating unit burning such fuel (B) Calculation48of partial exemption. The partial exemption under this paragraph shall49be determined by multiplying the quantity of non-highway diesel motor50fuel and residual petroleum product eligible for the exemption times the51sum of the then current rate of the supplemental tax imposed by section52three hundred one-j of this article and forty-six percent of the then53current rate of the tax imposed by section three hundred one-a of this54article, with respect to the specific non-highway diesel motor fuel or55residual petroleum product rate, as the case may be.]S. 3389 8 1 § 10. The subdivision heading and paragraph 1 of subdivision (c) of 2 section 301-b of the tax law, as added by chapter 190 of the laws of 3 1990, are amended to read as follows: 4 Sales to [New York state and] the federal government. (1) Motor fuel 5 imported or caused to be imported into this state or produced, refined, 6 manufactured or compounded in this state by a petroleum business regis- 7 tered under article twelve-A of this chapter, as a distributor of motor 8 fuel, and then sold by such petroleum business to an organization 9 described in paragraph [one or] two of subdivision (a) of section eleven 10 hundred sixteen of this chapter where such motor fuel is used by such 11 organization for its own use or consumption. 12 § 11. The opening paragraph and subdivisions (a) and (b) of section 13 301-c of the tax law, the opening paragraph as amended by section 2 of 14 part T of chapter 59 of the laws of 2022, subdivision (a) as amended by 15 section 23 of part K of chapter 61 of the laws of 2011, and subdivision 16 (b) as amended by chapter 330 of the laws of 1991, are amended to read 17 as follows: 18 A subsequent purchaser shall be eligible for reimbursement of tax with 19 respect to the following gallonage, subsequently sold by such purchaser 20 in accordance with subdivision (a), (b), (e), (h), [(j), (k), (n) or21(o)] (i), (k) or (l) of this section or used by such purchaser in 22 accordance with subdivision (c), (d), (f), (g), [(i), (l), (m)] (j) or 23 (q) of this section, which gallonage has been included in the measure of 24 the tax imposed by this article on a petroleum business: 25 (a) [Non-highway Diesel motor fuel used for heating purposes. (1)] 26 Total residential heating reimbursement. Non-highway Diesel motor fuel 27 purchased in this state and sold by such purchaser to a consumer for use 28 exclusively for residential heating purposes but only where (i) such 29 non-highway diesel motor fuel is delivered into a storage tank which is 30 not equipped with a hose or other apparatus by which such non-highway 31 Diesel motor fuel can be dispensed into the fuel tank of a motor vehicle 32 and such storage tank is attached to the heating unit burning such non- 33 highway Diesel motor fuel, (ii) the tax imposed pursuant to this article 34 has been paid with respect to such non-highway diesel motor fuel and the 35 entire amount of such tax has been absorbed by such purchaser, and (iii) 36 such purchaser possesses documentary proof satisfactory to the commis- 37 sioner evidencing the absorption by it of the entire amount of the tax 38 imposed pursuant to this article. Provided, however, that the commis- 39 sioner is authorized, in the event that the commissioner determines that 40 it would not threaten the integrity of the administration and enforce- 41 ment of the tax imposed by this article, to provide a reimbursement with 42 respect to a retail sale to a consumer for residential heating purposes 43 of less than ten gallons of non-highway diesel motor fuel provided such 44 fuel is not dispensed into the tank of a motor vehicle. 45 [(2) Partial non-residential heating reimbursement. (A) Non-highway46Diesel motor fuel purchased in this state and sold by such purchaser to47a consumer for use exclusively for heating, other than for residential48heating purposes, but only where (i) such non-highway diesel motor fuel49is delivered into a storage tank which is not equipped with a hose or50other apparatus by which such non-highway Diesel motor fuel can be51dispensed into the fuel tank of a motor vehicle and such storage tank is52attached to the heating unit burning such non-highway Diesel motor fuel,53(ii) the tax imposed pursuant to this article has been paid with respect54to such non-highway diesel motor fuel and the entire amount of such tax55has been absorbed by such purchaser, and (iii) such purchaser possesses56documentary proof satisfactory to the commissioner evidencing theS. 3389 9 1absorption by it of the entire amount of the tax imposed pursuant to2this article.3(B) Calculation of partial reimbursement. Notwithstanding any other4provision of this article, the amount of the reimbursement under this5paragraph shall be determined by multiplying the quantity of non-highway6diesel motor fuel eligible for the reimbursement times the sum of the7then current rate of the supplemental tax imposed by section three8hundred one-j of this article and forty-six percent of the then current9rate of the tax imposed by section three hundred one-a of this article,10with respect to the non-highway diesel motor fuel rate, as the case may11be.] 12 (b) Sales to [New York state and] the federal government. Motor fuel 13 and diesel motor fuel purchased in this state and sold by such purchaser 14 in this state to an organization described in paragraph [one or] two of 15 subdivision (a) of section eleven hundred sixteen of this chapter where 16 (i) such motor fuel or diesel motor fuel is for such organization's own 17 use or consumption, (ii) the tax imposed pursuant to this article has 18 been paid with respect to such motor fuel or diesel motor fuel and the 19 entire amount of such tax has been absorbed by such purchaser and, (iii) 20 such purchaser possesses documentary proof satisfactory to the commis- 21 sioner of taxation and finance evidencing the absorption by it of the 22 entire amount of the tax imposed pursuant to this article. Provided, 23 however, that the commissioner [of taxation and finance] shall require 24 such documentary proof to qualify for any reimbursement of tax provided 25 by this section as the commissioner deems appropriate, including the 26 expansion of any certification required pursuant to section two hundred 27 eighty-five-a or two hundred eighty-five-b of this chapter to cover the 28 taxes imposed pursuant to this article. 29 § 11-a. The opening paragraph of section 301-c of the tax law, as 30 amended by section 3 of part T of chapter 59 of the laws of 2022, is 31 amended to read as follows: 32 A subsequent purchaser shall be eligible for reimbursement of tax with 33 respect to the following gallonage, subsequently sold by such purchaser 34 in accordance with subdivision (a), (b), (e), (h), [(j)] or [(k)] (i) of 35 this section or used by such purchaser in accordance with subdivision 36 (c), (d), (f), (g), [(i), (l), (m)] (j) or (q) of this section, which 37 gallonage has been included in the measure of the tax imposed by this 38 article on a petroleum business: 39 § 12. Subdivisions (i), (j) and (l) of section 301-c of the tax law 40 are REPEALED. 41 § 13. Subdivisions (k), (m), (n), (o) and (p) of section 301-c of the 42 tax law are relettered subdivisions (i), (j), (k), (l) and (m). 43 § 14. Section 301-d of the tax law is REPEALED. 44 § 15. Subdivision (f) of section 301-e of the tax law is REPEALED. 45 § 16. Subdivision (a) of section 301-j of the tax law, as amended by 46 chapter 309 of the laws of 1996, paragraphs 1, 2, 3 and 4 as amended by 47 section 29 of part K of chapter 61 of the laws of 2011, is amended to 48 read as follows: 49 (a) Imposition of tax. (1) In addition to the taxes imposed by 50 sections three hundred one-a and three hundred one-e of this article, 51 there is hereby imposed upon every petroleum business subject to tax 52 imposed under section three hundred one-a of this article and every 53 aviation fuel business subject to the aviation gasoline component of the 54 tax imposed under section three hundred one-e of this article, a supple- 55 mental monthly tax for each or any part of a taxable month at a rate of 56 six and eight-tenths cents per gallon with respect to the productsS. 3389 10 1 included in each component of the taxes imposed by such section three 2 hundred one-a and the aviation gasoline component of the tax imposed by 3 such section three hundred one-e of this article. 4 (2) [Provided, however, "commercial gallonage," as such term is5defined in subdivision (k) of section three hundred of this article,6shall be exempt from the measure of the tax imposed under this section.7(3)] Provided, further, "railroad diesel," as such term is defined in 8 subdivision (l) of section three hundred of this article, shall be 9 exempt from the measure of the tax imposed under this section. 10 [(4)] (3) Provided, further, a separate per gallon rate shall apply 11 with respect to highway diesel motor fuel. Such rate shall be determined 12 by taking the adjusted rate per gallon of tax imposed under paragraph 13 one of this subdivision as adjusted in accordance with paragraph [five] 14 four of this subdivision and subtracting therefrom one and three-quar- 15 ters cents. Commencing January first, two thousand twelve, and each 16 January thereafter, the per gallon rate applicable to highway diesel 17 motor fuel shall be the adjusted rate under paragraph one of this subdi- 18 vision as adjusted in accordance with paragraph [five] four of this 19 subdivision which commences on such date minus one and three-quarters 20 cents. The resulting rate under this paragraph shall be expressed in 21 hundredths of a cent. 22 [(5)] (4) Except as herein provided, the tax imposed under this 23 section shall be calculated in the same respective manner as the taxes 24 imposed by section three hundred one-a and section three hundred one-e 25 of this article. Except [for section three hundred one-d and except] as 26 otherwise provided in this section, all the provisions of this article 27 applicable to the taxes imposed by sections three hundred one-a and 28 three hundred one-e of this article, shall apply with respect to the 29 supplemental tax imposed by this section to the same extent as if it 30 were respectively imposed by such sections. 31 § 17. Subparagraph (A) of paragraph 2 of subsection (a) of section 606 32 of the tax law, as amended by section 3 of part P of chapter 59 of the 33 laws of 2017, is amended to read as follows: 34 (A) A credit shall be allowed under this subsection with respect to 35 tangible personal property and other tangible property, including build- 36 ings and structural components of buildings, which are: depreciable 37 pursuant to section one hundred sixty-seven of the internal revenue 38 code, have a useful life of four years or more, are acquired by purchase 39 as defined in section one hundred seventy-nine (d) of the internal 40 revenue code, have a situs in this state and are (i) principally used by 41 the taxpayer in the production of goods by manufacturing, processing, 42 assembling, refining, mining, extracting, farming, agriculture, horti- 43 culture, floriculture, viticulture or commercial fishing, (ii) indus- 44 trial waste treatment facilities or air pollution control facilities, 45 used in the taxpayer's trade or business, (iii) research and development 46 property, (iv) principally used in the ordinary course of the taxpayer's 47 trade or business as a broker or dealer in connection with the purchase 48 or sale (which shall include but not be limited to the issuance, enter- 49 ing into, assumption, offset, assignment, termination, or transfer) of 50 stocks, bonds or other securities as defined in section four hundred 51 seventy-five (c)(2) of the Internal Revenue Code, or of commodities as 52 defined in section 475(e) of the Internal Revenue Code, (v) principally 53 used in the ordinary course of the taxpayer's trade or business of 54 providing investment advisory services for a regulated investment compa- 55 ny as defined in section eight hundred fifty-one of the Internal Revenue 56 Code, or lending, loan arrangement or loan origination services toS. 3389 11 1 customers in connection with the purchase or sale (which shall include 2 but not be limited to the issuance, entering into, assumption, offset, 3 assignment, termination, or transfer) of securities as defined in 4 section four hundred seventy-five (c)(2) of the Internal Revenue Code, 5 or (vi) principally used as a qualified film production facility includ- 6 ing qualified film production facilities having a situs in an empire 7 zone designated as such pursuant to article eighteen-B of the general 8 municipal law, where the taxpayer is providing three or more services to 9 any qualified film production company using the facility, including such 10 services as a studio lighting grid, lighting and grip equipment, multi- 11 line phone service, broadband information technology access, industrial 12 scale electrical capacity, food services, security services, and heat- 13 ing, ventilation and air conditioning. For purposes of clauses (iv) and 14 (v) of this subparagraph, property purchased by a taxpayer affiliated 15 with a regulated broker, dealer, or registered investment adviser is 16 allowed a credit under this subsection if the property is used by its 17 affiliated regulated broker, dealer or registered investment adviser in 18 accordance with this subsection. For purposes of determining if the 19 property is principally used in qualifying uses, the uses by the taxpay- 20 er described in clauses (iv) and (v) of this subparagraph may be aggre- 21 gated. In addition, the uses by the taxpayer, its affiliated regulated 22 broker, dealer and registered investment adviser under either or both of 23 those clauses may be aggregated. Provided, however, a taxpayer shall not 24 be allowed the credit provided by clauses (iv) and (v) of this subpara- 25 graph unless (I) eighty percent or more of the employees performing the 26 administrative and support functions resulting from or related to the 27 qualifying uses of such equipment are located in this state, or (II) the 28 average number of employees that perform the administrative and support 29 functions resulting from or related to the qualifying uses of such 30 equipment and are located in this state during the taxable year for 31 which the credit is claimed is equal to or greater than ninety-five 32 percent of the average number of employees that perform these functions 33 and are located in this state during the thirty-six months immediately 34 preceding the year for which the credit is claimed, or (III) the number 35 of employees located in this state during the taxable year for which the 36 credit is claimed is equal to or greater than ninety percent of the 37 number of employees located in this state on December thirty-first, 38 nineteen hundred ninety-eight or, if the taxpayer was not a calendar 39 year taxpayer in nineteen hundred ninety-eight, the last day of its 40 first taxable year ending after December thirty-first, nineteen hundred 41 ninety-eight. If the taxpayer becomes subject to tax in this state after 42 the taxable year beginning in nineteen hundred ninety-eight, then the 43 taxpayer is not required to satisfy the employment test provided in the 44 preceding sentence of this subparagraph for its first taxable year. For 45 the purposes of clause (III) of this subparagraph the employment test 46 will be based on the number of employees located in this state on the 47 last day of the first taxable year the taxpayer is subject to tax in 48 this state. If the uses of the property must be aggregated to determine 49 whether the property is principally used in qualifying uses, then either 50 each affiliate using the property must satisfy this employment test or 51 this employment test must be satisfied through the aggregation of the 52 employees of the taxpayer, its affiliated regulated broker, dealer, and 53 registered investment adviser using the property. For purposes of clause 54 (i) of this subparagraph, tangible personal property and other tangible 55 property shall not include property principally used by the taxpayer in 56 the production or distribution of electricity, natural gas afterS. 3389 12 1 extraction from wells, steam, or water delivered through pipes and 2 mains. For purposes of this subsection, tangible personal property and 3 other tangible property does not include property that directly produc- 4 es, transmits, distributes, transports, or stores fossil fuels as 5 defined in section 1-103 of the energy law, or directly utilizes fossil 6 fuels for the production of on-site energy, including thermal energy, 7 for any purpose. 8 § 18. Paragraph 3 of subdivision (b) of section 21 of the tax law, as 9 amended by chapter 420 of the laws of 2006, clause (i) of subparagraph 10 (B) as amended by section 22 of part BB of chapter 56 of the laws of 11 2015, is amended to read as follows: 12 (3) Qualified tangible property. "Qualified tangible property" is 13 property described in either subparagraph (A) or (B) and subparagraph 14 (C) of this paragraph which: 15 (A) (i) is depreciable pursuant to section one hundred sixty-seven of 16 the internal revenue code, 17 (ii) has a useful life of four years or more, 18 (iii) has been acquired by purchase as defined in section one hundred 19 seventy-nine (d) of the internal revenue code, 20 (iv) has a situs on a qualified site in this state, and 21 (v) is principally used by the taxpayer for industrial, commercial, 22 recreational or environmental conservation purposes (including the 23 commercial development of residential housing); or 24 (B) (i) is, or when occupied becomes, part of a dwelling whose primary 25 ownership structure is covered under either article nine-B of the real 26 property law or meets the requirements of section 216 (b)(1) of the 27 Internal Revenue Code or is part of an affordable housing project as 28 defined in subdivision twenty-nine of section 27-1405 of the environ- 29 mental conservation law, where units are sold as single family homes or 30 multiple family dwellings; 31 (ii) has been acquired by purchase (as defined in section one hundred 32 seventy-nine (d) of the Internal Revenue Code); 33 (iii) has a situs on a qualified site in this state; and 34 (iv) for purposes of this subparagraph only, and notwithstanding any 35 other section of law to the contrary, property qualifying under this 36 subparagraph shall be deemed to be qualified tangible property for the 37 purposes of paragraph one of subdivision (d) of this section; and in 38 addition, for the purposes of this subdivision only, property qualifying 39 under this subparagraph shall be deemed to have been placed in service 40 for the purposes of paragraph three of subdivision (a) of this section 41 when a certificate of occupancy is issued for such property; and 42 (C) does not directly produce, transmit, distribute, transport, or 43 store fossil fuels as defined in section 1-103 of the energy law, or 44 directly utilize fossil fuels for the production of on-site energy, 45 including thermal energy, for any purpose. 46 § 19. Subdivision 26 of section 210-B of the tax law is amended by 47 adding a new paragraph (g) to read as follows: 48 (g) For purposes of this subdivision, "qualified rehabilitation 49 expenditures" does not include expenditures for property that directly 50 produces, transmits, distributes, transports, or stores fossil fuels as 51 defined in section 1-103 of the energy law, or directly utilizes fossil 52 fuels for the production of on-site energy, including thermal energy, 53 for any purpose. 54 § 20. Subparagraphs (ix) and (x) of paragraph 3 and paragraph 5 of 55 subdivision (c) of section 1105 of the tax law, subparagraph (ix) of 56 paragraph 3 as added by chapter 395 of the laws of 1998, subparagraphS. 3389 13 1 (x) of paragraph 3 as added by section 1 of part FF of chapter 407 of 2 the laws of 1999, and paragraph 5 as amended by chapter 321 of the laws 3 of 2005, are amended to read as follows: 4 (ix) [such services rendered with respect to tangible property used or5consumed directly and predominantly in the production for sale of gas or6oil by manufacturing, processing, generating, assembling, refining,7mining, or extracting.8(x)] such services rendered with respect to property described in 9 paragraph twelve-a of subdivision (a) of section eleven hundred fifteen 10 of this article. 11 (5) Maintaining, servicing or repairing real property, property or 12 land, as such terms are defined in the real property tax law, whether 13 the services are performed in or outside of a building, as distinguished 14 from adding to or improving such real property, property or land, by a 15 capital improvement as such term capital improvement is defined in para- 16 graph nine of subdivision (b) of section eleven hundred one of this 17 article, but excluding (i) services rendered by an individual who is not 18 in a regular trade or business offering his services to the public, (ii) 19 [services rendered directly with respect to real property, property or20land used or consumed directly and predominantly in the production for21sale of gas or oil by manufacturing, processing, generating, assembling,22refining, mining, or extracting, (iii)] services rendered with respect 23 to real property, property or land used or consumed predominantly either 24 in the production of tangible personal property, for sale, by farming or 25 in a commercial horse boarding operation, or in both and [(iv)] (iii) 26 services of removal of waste material from a facility regulated as a 27 transfer station or construction and demolition debris processing facil- 28 ity by the department of environmental conservation, provided that the 29 waste material to be removed was not generated by the facility. 30 § 21. Subparagraph (xi) of paragraph 3 of subdivision (c) of section 31 1105 of the tax law is REPEALED. 32 § 22. Paragraph 9 of subdivision (a) of section 1115 of the tax law is 33 REPEALED. 34 § 23. Paragraph (ii) of subdivision (b) of section 1115 of the tax 35 law, as amended by section 30 of part Y of chapter 63 of the laws of 36 2000, is amended to read as follows: 37 (ii) [Gas, electricity] Electricity, refrigeration and steam, and 38 [gas,] electric, refrigeration and steam service of whatever nature for 39 use or consumption directly and exclusively in research and development 40 in the experimental or laboratory sense shall be exempt from the tax 41 imposed under subdivision (b) of section eleven hundred five and the 42 compensating use tax imposed under section eleven hundred ten of this 43 article. Such research and development shall not be deemed to include 44 the ordinary testing or inspection of materials or products for quality 45 control, efficiency surveys, management studies, consumer surveys, 46 advertising, promotions or research in connection with literary, histor- 47 ical or similar projects. 48 § 24. Paragraph 1 of subdivision (c) of section 1115 of the tax law, 49 as amended by section 7 of part B of chapter 63 of the laws of 2000, is 50 amended to read as follows: 51 (1) [Fuel, gas, electricity] Electricity, refrigeration and steam, and 52 [gas,] electric, refrigeration and steam service of whatever nature for 53 use or consumption directly and exclusively in the production of tangi- 54 ble personal property, [gas,] electricity, refrigeration or steam, for 55 sale, by manufacturing, processing, assembling, generating, refining, 56 mining or extracting shall be exempt from the taxes imposed under subdi-S. 3389 14 1 visions (a) and (b) of section eleven hundred five and the compensating 2 use tax imposed under section eleven hundred ten of this article. 3 § 25. Subdivision (j) of section 1115 of the tax law, as amended by 4 section 41 of part K of chapter 61 of the laws of 2011, is amended to 5 read as follows: 6 (j) The exemptions provided in this section shall not apply to the tax 7 required to be prepaid pursuant to the provisions of section eleven 8 hundred two of this article nor to the taxes imposed by sections eleven 9 hundred five and eleven hundred ten of this article with respect to 10 receipts from sales and uses of motor fuel or diesel motor fuel,[except11that the exemptions provided in paragraphs nine and forty-two of subdi-12vision (a) of this section shall apply to the tax required to be prepaid13pursuant to the provisions of section eleven hundred two of this article14and to the taxes imposed by sections eleven hundred five and eleven15hundred ten of this article with respect to sales and uses of kero-jet16fuel,] CNG, hydrogen and E85, provided, however, the exemption allowed 17 for E85 shall be subject to the additional requirements provided in 18 section eleven hundred two of this article with respect to E85. The 19 exemption provided in subdivision (c) of this section shall apply to 20 sales and uses of non-highway diesel motor fuel but only if all of such 21 fuel is consumed other than on the public highways of this state. The 22 exemption provided in subdivision (c) of this section shall apply to 23 sales and uses of non-highway diesel motor fuel for use or consumption 24 either in the production for sale of tangible personal property by farm- 25 ing or in a commercial horse boarding operation, or in both but only if 26 all of such fuel is consumed other than on the public highways of this 27 state (except for the use of the public highways to reach adjacent farm- 28 lands or adjacent lands used in a commercial horse boarding operation, 29 or both). 30 § 25-a. Subdivision (j) of section 1115 of the tax law, as amended by 31 section 41-a of part K of chapter 61 of the laws of 2011, is amended to 32 read as follows: 33 (j) The exemptions provided in this section shall not apply to the tax 34 required to be prepaid pursuant to the provisions of section eleven 35 hundred two of this article nor to the taxes imposed by sections eleven 36 hundred five and eleven hundred ten of this article with respect to 37 receipts from sales and uses of motor fuel or diesel motor fuel[, except38that the exemption provided in paragraph nine of subdivision (a) of this39section shall apply to the tax required to be prepaid pursuant to the40provisions of section eleven hundred two of this article and to the41taxes imposed by sections eleven hundred five and eleven hundred ten of42this article with respect to sales and uses of kero-jet fuel]. The 43 exemption provided in subdivision (c) of this section shall apply to 44 sales and uses of non-highway diesel motor fuel but only if all of such 45 fuel is consumed other than on the public highways of this state. The 46 exemption provided in subdivision (c) of this section shall apply to 47 sales and uses of non-highway diesel motor fuel for use or consumption 48 either in the production for sale of tangible personal property by farm- 49 ing or in a commercial horse boarding operation, or in both but only if 50 all of such fuel is consumed other than on the public highways of this 51 state (except for the use of the public highways to reach adjacent farm- 52 lands or adjacent lands used in a commercial horse boarding operation, 53 or both). 54 § 26. Subdivision (s) of section 1115 of the tax law, as added by 55 chapter 201 of the laws of 1995, is relettered subdivision (p).S. 3389 15 1 § 27. Subdivision (w) of section 1115 of the tax law, as added by 2 section 32 of part Y of chapter 63 of the laws of 2000, is amended to 3 read as follows: 4 (w) Receipts from the sale of [gas or] electricity or [gas or] elec- 5 tric service of whatever nature and consideration given or contracted to 6 be given for, or for the use of, [gas or] electricity or [gas or] elec- 7 tric service of whatever nature purchased for use or consumption direct- 8 ly and exclusively to provide [gas or] electric service of whatever 9 nature consisting of operating [a gas pipeline or gas distribution line10or] an electric transmission or distribution line [and ensuring the11necessary working pressure in an underground gas storage facility] shall 12 be exempt from sales and compensating use taxes imposed by this article. 13 Such exempt [gas or] electricity or [gas or] electric service of whatev- 14 er nature shall include, but shall not be limited to, such [gas or] 15 electricity or [gas or] electric service of whatever nature used or 16 consumed directly and exclusively to (1) [ensure necessary working pres-17sure in a gas pipeline used to transport, transmit or distribute gas,18(2) operate compressors used to transport, transmit or distribute gas19through such a gas pipeline or distribution line or used to ensure20necessary working pressure in such a storage facility, (3) operate heat-21ers to prevent gas in such a pipeline or distribution line from freez-22ing, (4) operate equipment which removes impurities and moisture from23gas in such a pipeline or distribution line, (5)] operate substations 24 and equipment related to electric transmission and distribution lines 25 such as transformers, capacitors, meters, switches, communication 26 devices and heating and cooling equipment, and [(6)] (2) ensure the 27 reliability of electricity or electric service transmitted or distrib- 28 uted through such lines, for example, by operating reserve capacity 29 machinery and equipment. 30 § 28. Subdivision (k) of section 300 of the tax law, as amended by 31 section 17 of part K of chapter 61 of the laws of 2011, is amended to 32 read as follows: 33 (k) "Commercial gallonage" means gallonage (1) which is non-highway 34 diesel motor fuel or residual petroleum product, (2) [which is included35in the full measure of the non-highway diesel motor fuel component or36the residual petroleum product component of the tax imposed under37section three hundred one-a of this article, (3)] which does not (and 38 will not) qualify (A) [for the utility credit or reimbursement provided39for in section three hundred one-d of this article, (B)] as "manufactur- 40 ing gallonage", as such term is defined in subdivision (m) of this 41 section, [(C)] or (B) for the not-for-profit organization exemption 42 provided for in subdivision (h) of section three hundred one-b of this 43 article, [or (D) for the heating exemption provided for in paragraph two44of subdivision (d) of section three hundred one-b of this article or the45heating reimbursement provided for in paragraph two of subdivision (a)46of section three hundred one-c of this article,] and [(4)] (3) which 47 will not be used nor has been used in the fuel tank connecting with the 48 engine of a vessel. No gallonage shall qualify as "commercial gallonage" 49 where such gallonage is eligible for the [(i) utility credit or50reimbursement under such section three hundred one-d of this article,51(ii) "manufacturing exemption" under paragraph three of subdivision (f)52of section three hundred one-a of this article, (iii)] not-for-profit 53 organization exemption under subdivision (h) of section three hundred 54 one-b of this article[, or (iv) heating exemption provided for in para-55graph two of subdivision (d) of section three hundred one-b of this56article or the heating reimbursement provided for in paragraph two ofS. 3389 16 1subdivision (a) of section three hundred one-c of this article]. The 2 commissioner shall require such documentary proof to substantiate the 3 classification of product as "commercial gallonage" as the commissioner 4 deems appropriate. 5 § 29. Paragraph 1 of subdivision (f) of section 301-b of the tax law, 6 as amended by section 21 of part K of chapter 61 of the laws of 2011, is 7 amended to read as follows: 8 (1) Residual petroleum product and non-highway diesel motor fuel sold 9 to an electric corporation, [as described in subdivision (a) of section10three hundred one-d of this article,] as defined in subdivision thirteen 11 of section two of the public service law, subject to the supervision of 12 the department of public service, which is registered with the depart- 13 ment as a petroleum business tax direct pay permittee, and used by such 14 electric corporation to fuel generators for the purpose of manufacturing 15 or producing electricity where such electric corporation provides a copy 16 of a direct pay permit authorized and issued by the commissioner, to the 17 petroleum business making such sale. If so registered, such corporation 18 shall be a taxpayer under this article and (i) such electric corporation 19 shall file a return monthly and pay the applicable tax under this arti- 20 cle, after the application of allowable credits, on all such purchases 21 directly to the commissioner, (ii) such electric corporation shall be 22 subject to all of the provisions of this article relating to the respon- 23 sibilities and liabilities of taxpayers under this article with respect 24 to such residual petroleum product and non-highway diesel motor fuel. 25 § 30. Subdivision (y) of section 1511 of the tax law, as added by 26 chapter 472 of the laws of 2010, is amended by adding a new paragraph 7 27 to read as follows: 28 (7) For purposes of this subdivision, "qualified rehabilitation 29 expenditures" does not include expenditures for property that directly 30 produces, transmits, distributes, transports, or stores fossil fuels as 31 defined in section 1-103 of the energy law, or directly utilizes fossil 32 fuels for the production of on-site energy, including thermal energy, 33 for any purpose. 34 § 31. Paragraph (c) of subdivision 1 of section 3102-e of the public 35 authorities law, as added by section 31 of part A of chapter 56 of the 36 laws of 1998, is amended to read as follows: 37 (c) "Qualified emerging technology company" shall mean a company 38 located in New York state: (1) whose primary products or services are 39 classified as emerging technologies and whose total annual product sales 40 are ten million dollars or less; or (2) a company which has research and 41 development activities in New York state and whose ratio of research and 42 development funds to net sales equals or exceeds the average ratio for 43 all surveyed companies classified as determined by the National Science 44 Foundation in the most recent published results from its Survey of 45 Industry Research and Development, or any comparable successor survey as 46 determined by the department, and whose total annual product sales are 47 ten million dollars or less. Qualified emerging technology company shall 48 not include a company engaged in the production, transmission, distrib- 49 ution, transportation, or storage of fossil fuels as defined in section 50 1-103 of the energy law. 51 The definition of "research and development funds" shall be the same 52 as that used by the National Science Foundation in the aforementioned 53 survey. 54 § 32. Subparagraph (vi) of paragraph (a) of subdivision 1 of section 55 210 of the tax law, as amended by section 1 of part D of chapter 59 of 56 the laws of 2019, is amended to read as follows:S. 3389 17 1 (vi) for taxable years beginning on or after January first, two thou- 2 sand fourteen, the amount prescribed by this paragraph for a taxpayer 3 that is a qualified New York manufacturer, shall be computed at the rate 4 of zero percent of the taxpayer's business income base. The term 5 "manufacturer" shall mean a taxpayer that during the taxable year is 6 principally engaged in the production of goods by manufacturing, proc- 7 essing, assembling, refining, mining, extracting, farming, agriculture, 8 horticulture, floriculture, viticulture or commercial fishing. However, 9 the generation and distribution of electricity, the distribution of 10 natural gas, [and] the production of steam associated with the gener- 11 ation of electricity, and the production, transmission, distribution, 12 transportation, or storage of fossil fuels as defined in section 1-103 13 of the energy law shall not be qualifying activities for a manufacturer 14 under this subparagraph. Moreover, in the case of a combined report, the 15 combined group shall be considered a "manufacturer" for purposes of this 16 subparagraph only if the combined group during the taxable year is prin- 17 cipally engaged in the activities set forth in this paragraph, or any 18 combination thereof. A taxpayer or, in the case of a combined report, a 19 combined group shall be "principally engaged" in activities described 20 above if, during the taxable year, more than fifty percent of the gross 21 receipts of the taxpayer or combined group, respectively, are derived 22 from receipts from the sale of goods produced by such activities. In 23 computing a combined group's gross receipts, intercorporate receipts 24 shall be eliminated. A "qualified New York manufacturer" is a manufac- 25 turer that has property in New York that is described in clause (A) of 26 subparagraph (i) of paragraph (b) of subdivision one of section two 27 hundred ten-B of this article and either (I) the adjusted basis of such 28 property for New York state tax purposes at the close of the taxable 29 year is at least one million dollars or (II) all of its real and 30 personal property is located in New York. A taxpayer or, in the case of 31 a combined report, a combined group, that does not satisfy the princi- 32 pally engaged test may be a qualified New York manufacturer if the 33 taxpayer or the combined group employs during the taxable year at least 34 two thousand five hundred employees in manufacturing in New York and the 35 taxpayer or the combined group has property in the state used in manu- 36 facturing, the adjusted basis of which for New York state tax purposes 37 at the close of the taxable year is at least one hundred million 38 dollars. 39 § 33. Subparagraph 2 of paragraph (b) of subdivision 1 of section 210 40 of the tax law, as amended by section 2 of part D of chapter 59 of the 41 laws of 2019, is amended to read as follows: 42 (2) For purposes of subparagraph one of this paragraph, the term 43 "manufacturer" shall mean a taxpayer that during the taxable year is 44 principally engaged in the production of goods by manufacturing, proc- 45 essing, assembling, refining, mining, extracting, farming, agriculture, 46 horticulture, floriculture, viticulture or commercial fishing; provided, 47 however, the production, transmission, distribution, transportation, or 48 storage of fossil fuels as defined in section 1-103 of the energy law 49 shall not be qualifying activities for a manufacturer under this subpar- 50 agraph. Moreover, for purposes of computing the capital base in a 51 combined report, the combined group shall be considered a "manufacturer" 52 for purposes of this subparagraph only if the combined group during the 53 taxable year is principally engaged in the activities set forth in this 54 subparagraph, or any combination thereof. A taxpayer or, in the case of 55 a combined report, a combined group shall be "principally engaged" in 56 activities described above if, during the taxable year, more than fiftyS. 3389 18 1 percent of the gross receipts of the taxpayer or combined group, respec- 2 tively, are derived from receipts from the sale of goods produced by 3 such activities. In computing a combined group's gross receipts, inter- 4 corporate receipts shall be eliminated. A "qualified New York manufac- 5 turer" is a manufacturer that has property in New York that is described 6 in clause (A) of subparagraph (i) of paragraph (b) of subdivision one of 7 section two hundred ten-B of this article and either (i) the adjusted 8 basis of that property for New York state tax purposes at the close of 9 the taxable year is at least one million dollars or (ii) all of its real 10 and personal property is located in New York. In addition, a "qualified 11 New York manufacturer" means a taxpayer that is defined as a qualified 12 emerging technology company under paragraph (c) of subdivision one of 13 section thirty-one hundred two-e of the public authorities law regard- 14 less of the ten million dollar limitation expressed in subparagraph one 15 of such paragraph. A taxpayer or, in the case of a combined report, a 16 combined group, that does not satisfy the principally engaged test may 17 be a qualified New York manufacturer if the taxpayer or the combined 18 group employs during the taxable year at least two thousand five hundred 19 employees in manufacturing in New York and the taxpayer or the combined 20 group has property in the state used in manufacturing, the adjusted 21 basis of which for New York state tax purposes at the close of the taxa- 22 ble year is at least one hundred million dollars. 23 § 34. This act shall take effect immediately and shall apply to taxa- 24 ble years commencing on or after the first of January next succeeding 25 the date on which it shall have become a law; provided, however, that: 26 (a) the amendments to paragraphs 6, 7 and 8 of subdivision (a) of 27 section 301-b made by section nine of this act shall not affect the 28 repeal of such paragraphs and shall be deemed repealed therewith; 29 (b) the amendments to the opening paragraph of section 301-c of the 30 tax law made by section eleven of this act shall be subject to the expi- 31 ration and reversion of such paragraph pursuant to section 19 of part 32 W-1 of chapter 109 of the laws of 2006, as amended, when upon such date 33 the provisions of section eleven-a of this act shall take effect; 34 (c) the amendments to subdivisions (k) and (l) of section 301-c of the 35 tax law made by section thirteen of this act shall not affect the repeal 36 of such subdivisions and shall be deemed repealed therewith; and 37 (d) the amendments to subdivision (j) of section 1115 of the tax law 38 made by section twenty-five of this act shall be subject to the expira- 39 tion and reversion of such subdivision pursuant to section 19 of part 40 W-1 of chapter 109 of the laws of 2006, as amended, when upon such date 41 the provisions of section twenty-five-a of this act shall take effect.
