NY Tax L § 22 (2021)
2021 New York Laws TAX - Tax Article 1 - Short Title; Definitions; Miscellaneous 22 - Tax Credit for Remediated Brownfields.

§ 22. Tax credit for remediated brownfields.  (a) Definitions. As used in this section the following terms shall have the following meanings:  (1) Certificate of completion. A "certificate of completion" issued by the  commissioner  of  environmental  conservation  pursuant  to section 27-1419 of the environmental conservation law.  (2) Qualified site. For purposes of this section, a  "qualified  site" is  a  site  with  respect to which a certificate of completion has been issued by the commissioner of  environmental  conservation  pursuant  to section 27-1419 of the environmental conservation law.  (3)  Developer.  (i)  A  "developer" is a taxpayer under article nine, nine-A, twenty-two or thirty-three of this chapter who or  which  either (I)  has  been  issued  a  certificate  of  completion with respect to a qualified site or (II) has purchased  or  in  any  other  way  has  been conveyed  all  or any portion of a qualified site from a taxpayer or any other party who or which has been issued  a  certificate  of  completion with  respect  to such site provided, such purchase or conveyance occurs within  seven  years  of  the  effective  date  of  the  certificate  of completion issued with respect to such qualified site. Provided further, that  the  taxpayer  who  or which is purchasing all or any portion of a qualified site and the taxpayer or any other party who or which has been issued a certificate of completion with respect to such site may not  be related  persons,  as  such  term  is  defined  in  subparagraph  (C) of paragraph three of subsection (b) of section four hundred sixty-five  of the internal revenue code.  (ii)  Where  the  entity  to whom a certificate of completion has been issued is a partnership, or where the entity which has purchased all  or any  portion  of  a qualified site from a taxpayer who or which has been issued a certificate of completion with respect to such site within  the applicable  time limit is a partnership, any partner in such partnership who or which is  taxable  under  article  nine,  nine-A,  twenty-two  or thirty-three  of this chapter shall be a developer under this paragraph. Where the entity to whom a certificate of completion has been issued  is a New York S corporation, or where the entity which has purchased all or any  portion  of  a qualified site from a taxpayer who or which has been issued a certificate of completion with respect to such site within  the applicable  time  limit  is a New York S corporation, any shareholder in such New York S corporation shall be a developer under this paragraph.  (4) Cessation of status. A taxpayer shall cease to be a  developer  on the  first  day  of  the  taxable  year  during  which revocation of its certificate of completion under section  27-1419  of  the  environmental conservation  law is final and no longer subject to judicial review, and the amount of any credit allowed by this section shall be added back  in the  taxable  year  in  which  such determination is final and no longer subject to judicial review.  (5) Environmental zones (EN-Zones). An "environmental zone" shall mean an area designated as such by the commissioner of economic  development. Such  areas  so  designated  are areas which are census tracts and block numbering areas which, as of the two thousand census, satisfy either  of the following criteria:  (A) areas that have both:  (i)  a  poverty  rate of at least twenty percent for the year to which the data relate;  (ii) an unemployment rate of at least one and  one-quarter  times  the statewide unemployment rate for the year to which the data relate, or;  (B)  areas  that have a poverty rate of at least two times the poverty rate for the county in which the areas are located for the year to which the data relate, provided, however, that a qualified site shall only  be deemed  to  be  located in an environmental zone under this subparagraph  (B) if such site was the subject of a brownfield site cleanup  agreement pursuant  to  section 27-1409 of the environmental conservation law that was entered into prior to September first, two thousand ten.   Such  designation  shall  be made and a list of all such environmental zones shall be established by the commissioner of  economic  development no  later  than  December  thirty-first,  two  thousand  four  provided, however, that a qualified site shall only be deemed to be located in  an environmental zone under subparagraph (B) of this paragraph if such site was  the  subject  of  a  brownfield  site cleanup agreement pursuant to section 27-1409 of the environmental conservation law that  was  entered into prior to September first, two thousand ten.  (b) Remediated brownfield credit for real property taxes for qualified sites.   (1) Allowance of credit. A developer of a qualified site who or which is subject to  tax  under  article  nine,  nine-A,  twenty-two  or thirty-three  of  this  chapter,  shall be allowed a credit against such tax, pursuant to the provisions referenced in  paragraph  nine  of  this subdivision, for eligible real property taxes imposed on such site.  (2)  Amount  of  credit. The amount of the credit shall be twenty-five percent of the product of  (i)  the  benefit  period  factor,  (ii)  the employment  number  factor,  and  (iii) the eligible real property taxes paid or incurred by the developer  of  the  qualified  site  during  the taxable  year  (or  the  pro  rata  share of such taxes in the case of a partner in a partnership or a shareholder in a New York S  corporation), except  that  if  the  real  property which is the subject of the credit provided for under this  section  is  attributed  to  a  qualified  site located  in  an  environmental  zone  as  defined  in  paragraph five of subdivision (a) of this section, the amount of the credit shall  be  the product  of the factors and taxes referred to in subparagraphs (i), (ii) and (iii) of this paragraph. However, the amount of the credit  may  not exceed  the  credit  limitation  set  forth  in  paragraph seven of this subdivision.  (3) Benefit period factor. The benefit period factor  is  a  numerical value  corresponding  with  a  benefit period of ten consecutive taxable years commencing  in  the  taxpayer's  taxable  year  during  which  the certificate  of  completion  is  issued  for  the  qualified site or the taxpayer's first taxable year commencing on or after  April  first,  two thousand  five,  whichever  is later. The benefit period factors are set forth in the following table: Taxable year of benefit period:     Benefit period factor: 1-10                                1.0  (4) Employment number factor. (i) The employment  number  factors  are set forth in the following table: Average number of full-time                  Employment number factor: employees employed by the developer of a qualified site, plus the average number of full-time employees employed by a lessee or lessees of a portion of such qualified site, where such employees are employed at such site during the taxable year: At least 25 but less than 50                    .25 At least 50 but less than 75                    .50 At least 75 but less than 100                   .75 At least 100                                   1.00  (ii)  For  purposes of this paragraph, the average number of full-time employees, excluding general executive officers, employed by a developer  and a lessee at  a  qualified  site  during  a  taxable  year  or  other applicable  period, shall be computed by ascertaining the number of such employees employed by the developer and such lessee on the  thirty-first day  of March, the thirtieth day of June, the thirtieth day of September and the thirty-first day of December during each taxable year  or  other applicable  period,  by  adding  together the number of such individuals ascertained on each of such dates and dividing the sum  so  obtained  by the  number  of  such  dates occurring within such taxable year or other applicable period. Where the developer is a partner in a partnership  or a  shareholder  in  a  New  York  S corporation, the number of full-time employees of the partnership or the New York S corporation respectively, at such qualified site, shall be used for purposes of this calculation.  (5) Eligible real property taxes. The  term  "eligible  real  property taxes"  means  taxes  imposed  on  real  property  which  consists  of a qualified site owned by the developer, provided such taxes become a lien on the real property in a period during which the  real  property  is  a qualified  site.  In  addition,  the term "eligible real property taxes" includes payments in lieu of taxes by the developer, with respect  to  a qualified  site,  to  the  state,  a  municipal  corporation or a public benefit corporation pursuant to a written agreement entered into between the developer and the state, a municipal corporation or a public benefit corporation. Provided, however, such a payment in lieu  of  taxes  shall not  constitute  eligible real property taxes in any taxable year to the extent that such payment exceeds the product of (A) the greater  of  (i) the  basis  for  federal income tax purposes, determined on the date the taxpayer becomes a developer as defined  under  this  section,  of  real property,  including  buildings  and structural components of buildings, owned by the developer and located on a qualified site with  respect  to which  the taxpayer is a developer, or (ii) the basis for federal income tax purposes of such real property  described  in  clause  (i)  of  this subparagraph  on the last day of the taxable year, and (B) the estimated effective full value tax rate within the county in which  such  property is  located,  as  most  recently  calculated  by  the  commissioner. The commissioner shall annually calculate estimated and effective full value tax rates within each county  for  this  purpose  based  upon  the  most current information available to him or her in relation to county, city, town,  village  and  school  district taxes. Provided further, where the amount of the credit determined under paragraph two of this  subdivision is  the total product of the factors and tax specified therein, the term "eligible real property taxes" under this paragraph shall apply only  to taxes  imposed  on real property which is attributed to a qualified site located in an environmental zone. Where the developer is a partner in  a partnership  or  a  shareholder  in  a New York S corporation, such real property  shall  be  owned  by  the  partnership  or  the  New  York   S corporation, respectively.  (6) Credit recapture. Where a developer's eligible real property taxes which  were the basis for the allowance of the credit provided for under this subdivision are subsequently reduced as a result of a  final  order in  any  proceeding  under article seven of the real property tax law or other provision of law, the taxpayer shall add back, in the taxable year in which such final order is issued, the excess of  (i)  the  amount  of credit  originally  allowed  for  a taxable year over (ii) the amount of credit determined based upon the reduced eligible real  property  taxes. If  such final order reduces real property taxes for more than one year, the taxpayer must determine how much of such reduction  is  attributable to  each  year  covered  by such final order and calculate the amount of credit which is required by this paragraph to  be  recaptured  for  each year based on such reduction.  (7)  Credit  limitation. The credit limitation shall be the product of (i) ten thousand dollars  and  (ii)  the  average  number  of  full-time employees  employed by the developer of a qualified site and a lessee or lessees of a portion of such qualified site during the taxable year,  as such  average  is  computed under subparagraph (ii) of paragraph four of this subdivision.  (8) Credit option. If the qualified site is located  in  whole  or  in part  in  an  area  designated  as  an  empire  zone pursuant to article eighteen-B of the general  municipal  law,  and  a  taxpayer  meets  the eligibility  requirements  for  both  the credit provided for under this section and the QEZE credit for real property taxes provided  for  under section  fifteen  of  this  article, with respect to all or part of such site, such taxpayer shall not be allowed to claim both such credits. The taxpayer shall be required, in the first taxable year such  taxpayer  is allowed  to claim a credit under this section, to elect whether to claim the credit provided for under this section or the  credit  provided  for under  section fifteen of this article. Such election shall be made with the filing of the return or report required under article nine,  nine-A, twenty-two,  thirty-two  or  thirty-three  of this chapter, whichever is applicable, for such taxable year. Such election shall apply to  and  be binding  in  each  subsequent  taxable  year  applicable  to  the credit provided for under either  this  section  or  section  fifteen  of  this article. A taxpayer who or which has been allowed a credit under section fifteen  of  this article, in a taxable year preceding the first taxable year such taxpayer is allowed to claim  a  credit  under  this  section, shall  not  be  precluded  from making the election provided for in this paragraph.  (9) Cross-references. For application of the credit  provided  for  in this subdivision, see the following provisions of this chapter:  (i) Article 9: Section 187-h.  (ii) Article 9-A: Section 210-B: subdivision 18.  (iii) Article 22: Section 606: subsections (i) and (ee).  (iv) Article 33: Section 1511: subdivision (v).