STATE OF NEW YORK
        ________________________________________________________________________
                                         8636--A
                    IN SENATE
                                      May 10, 2018
                                       ___________
        Introduced  by  Sen.  MARCELLINO  -- read twice and ordered printed, and
          when printed to be committed to the Committee on Environmental Conser-
          vation -- committee discharged, bill  amended,  ordered  reprinted  as
          amended and recommitted to said committee
        AN  ACT  to amend the environmental conservation law and the tax law, in
          relation to the calculation of the brownfield site preparation  credit
          for certain taxpayers
          The  People of the State of New York, represented in Senate and Assem-
        bly, do enact as follows:
     1    Section 1. Subdivision 3  of  section  27-1419  of  the  environmental
     2  conservation  law,  as amended by section 10 of part BB of chapter 56 of
     3  the laws of 2015, is amended to read as follows:
     4    3. Upon receipt of the final engineering report, the department  shall
     5  review  such  report  and  the data submitted pursuant to the brownfield
     6  site cleanup agreement as well as any other relevant information regard-
     7  ing the brownfield site. Upon satisfaction of the commissioner that  the
     8  remediation  requirements  set  forth in this title have been or will be
     9  achieved in accordance with the timeframes, if any, established  in  the
    10  remedial  work  plan, the commissioner shall issue a written approval of
    11  the final engineering  report  and  a  certificate  of  completion.  The
    12  certificate  shall include such information as determined by the depart-
    13  ment of taxation and finance, including but not limited  to  the  brown-
    14  field site boundaries included in the final engineering report, the date
    15  of the brownfield site cleanup agreement, and the applicable percentages
    16  available  as of the date of the certificate of completion for that site
    17  for purposes of section twenty-one of the tax law. For those  sites  for
    18  which  the  department  has issued a notice to the applicant on or after
    19  July first, two thousand fifteen or the date of publication in the state
    20  register of proposed regulations defining "underutilized" as provided in
    21  subdivision thirty of section 27-1405 of this title, whichever shall  be
    22  later, that its request for participation has been accepted under subdi-
    23  vision six of section 27-1407 of this title, the tangible property cred-
    24  it  component  of  the  brownfield  redevelopment tax credit pursuant to
    25  paragraph three of subdivision (a) of section twenty-one of the tax  law
    26  shall  only  be  available to the taxpayer if the criteria for receiving
    27  such tax component have been met. For those sites for which the  depart-
    28  ment  has  issued  a notice to the taxpayer after June twenty-third, two
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD15844-03-8

        S. 8636--A                          2
     1  thousand eight that its request  for  participation  has  been  accepted
     2  under  subdivision  six of section 27-1407 of this title, the applicable
     3  percentage for the site preparation credit component pursuant  to  para-
     4  graph  two  of subdivision (a) of section twenty-one of the tax law, and
     5  the on-site groundwater remediation credit component pursuant  to  para-
     6  graph four of subdivision (a) of section twenty-one of the tax law shall
     7  be  based  on the level of cleanup achieved pursuant to subdivision four
     8  of section 27-1415 of this title and the level of cleanup  of  soils  to
     9  contaminant-specific  soil  cleanup  objectives  promulgated pursuant to
    10  subdivision six of section 27-1415 of this title, up  to  a  maximum  of
    11  fifty percent, as follows:
    12    (a)  soil  cleanup for unrestricted use, the protection of groundwater
    13  or the protection of ecological  resources,  the  applicable  percentage
    14  shall be fifty percent;
    15    (b)  soil cleanup for residential use, the applicable percentage shall
    16  be forty percent,  except  for  Track  4  which  shall  be  twenty-eight
    17  percent;
    18    (c)  soil  cleanup for commercial use, the applicable percentage shall
    19  be thirty-three percent, except for Track 4 which shall  be  twenty-five
    20  percent;
    21    (d)  soil  cleanup for industrial use, the applicable percentage shall
    22  be twenty-seven percent, except for Track 4 which  shall  be  twenty-two
    23  percent.
    24    §  2.  Paragraph 2 of subdivision (b) of section 21 of the tax law, as
    25  amended by section 23 of part BB of chapter 56 of the laws of  2015,  is
    26  amended to read as follows:
    27    (2)  (A)  Site  preparation  costs.  The term "site preparation costs"
    28  shall mean all amounts properly chargeable to a capital  account,  which
    29  are  paid or incurred which are necessary to implement a site's investi-
    30  gation, remediation, or qualification for a certificate  of  completion,
    31  and shall include costs of: excavation; demolition; activities undertak-
    32  en  under the oversight of the department of labor or in accordance with
    33  standards established by the  department  of  health  to  remediate  and
    34  dispose  of  regulated materials including asbestos, lead or polychlori-
    35  nated biphenyls; environmental  consulting;  engineering;  legal  costs;
    36  transportation, disposal, treatment or containment of contaminated soil;
    37  remediation  measures  taken  to  address contaminated soil vapor; cover
    38  systems consistent with  applicable  regulations;  physical  support  of
    39  excavation;  dewatering  and  other work to facilitate or enable remedi-
    40  ation activities; sheeting,  shoring,  and  other  engineering  controls
    41  required  to prevent off-site migration of contamination from the quali-
    42  fied site or migrating onto the qualified site; [and] the costs of fenc-
    43  ing, temporary electric wiring,  scaffolding,  and  security  facilities
    44  until  such  time  as the certificate of completion has been issued; and
    45  the cost of activities set forth in all work  plans  and  in  the  final
    46  engineering report approved under title fourteen of article twenty-seven
    47  of  the  environmental  conservation law. Site preparation shall include
    48  all costs paid or incurred within sixty months after the last day of the
    49  tax year in which the certificate  of  completion  is  issued  that  are
    50  necessary  for  compliance  with the certificate of completion or subse-
    51  quent modifications thereof, or the remedial  program  defined  in  such
    52  certificate  of  completion  including  but not limited to institutional
    53  controls, engineering controls, an approved site management plan, and an
    54  environmental easement with respect to the qualified site. Site prepara-
    55  tion cost shall [not] include the costs of foundation systems  that  are
    56  part of the site's engineering controls described in approved work plans

        S. 8636--A                          3
     1  or  a  final  engineering report under title fourteen of article twenty-
     2  seven of the environmental conservation law, but only to the extent that
     3  such foundation system costs do not exceed costs for  the  cover  system
     4  requirements which shall be defined in the regulations applicable to the
     5  qualified site.
     6    (B)  With respect to any site for which (1) the department of environ-
     7  mental conservation has issued a notice before July first, two  thousand
     8  fifteen  that  a request for participation with respect to the qualified
     9  site has been accepted under subdivision six of section 27-1407  of  the
    10  environmental  conservation  law,  and  (2) the taxpayer's claim for the
    11  site preparation credit component determined with respect to the  site's
    12  qualification  for  the  certificate  of completion has not been finally
    13  determined: site preparation cost shall include the costs of  foundation
    14  systems  that  are  part of the site's engineering controls described in
    15  approved work plans or a final engineering report under  title  fourteen
    16  of article twenty-seven of the environmental conservation law, which are
    17  minimum cover system costs for at least one foot thickness of low perme-
    18  able  material  such  as concrete or asphalt at sites where the remedial
    19  cover system is being constructed after end point data has confirmed the
    20  selected remedial track pursuant to subdivision four of section  27-1415
    21  of  the  environmental  conservation  law has been met and the remaining
    22  soil is structurally supportive; or costs for two feet thickness of  low
    23  permeable material such as concrete or asphalt for sites where the reme-
    24  dial  cover  system  is  being  constructed  after  end  point  data has
    25  confirmed the selected remedial track pursuant to  subdivision  four  of
    26  section  27-1415  of the environmental conservation law has been met and
    27  the remaining soil is structurally unsound soil, such as  historic  fill
    28  or sand.
    29    (C)  Site  preparation  costs  as defined in this paragraph, and which
    30  under the Internal Revenue  Code,  as  amended,  may  also  be  properly
    31  included  in  the cost or other basis for federal income tax purposes of
    32  qualified tangible property, as described in  paragraph  three  of  this
    33  subdivision,  shall  be allowable for purposes of the calculation of the
    34  site preparation credit component under paragraph two of subdivision (a)
    35  of this section, but any such costs shall be excluded from  such  quali-
    36  fied  tangible  property  basis for purposes of calculating the tangible
    37  property credit component under paragraph three of  subdivision  (a)  of
    38  this section.
    39    §  3.  This  act  shall take effect immediately and shall apply to all
    40  sites for which the taxpayer's claim for  the  site  preparation  credit
    41  component  determined  with  respect to the site's qualification for the
    42  certificate of completion has not been finally  determined  as  of  such
    43  effective  date. Any non-final determinations by the commissioner of the
    44  department of taxation and finance shall be subject  to  redetermination
    45  to  give  effect  to  this act. The taxpayer may seek redetermination by
    46  written notice to the commissioner given on or before the date which  is
    47  one year from such effective date. Such redetermination shall be made by
    48  the  department of taxation and finance desk audit bureau or other proc-
    49  ess established by the commissioner by regulation, and shall be  subject
    50  to  review pursuant to article 40 of the tax law. Effective immediately,
    51  the addition, amendment and/or repeal of any rule or  regulation  neces-
    52  sary  for  the  implementation  of  this  act  on its effective date are
    53  authorized and directed to be made  and  completed  on  or  before  such
    54  effective date.