S01976 Summary:

BILL NOS01976A
 
SAME ASNo Same As
 
SPONSORGOLDEN
 
COSPNSRFELDER, ADDABBO, AVELLA, BONACIC, BOYLE, CROCI, DIAZ, FLANAGAN, FUNKE, GALLIVAN, HAMILTON, HASSELL-THOMPSON, KLEIN, LANZA, LARKIN, LATIMER, MARCHIONE, MARTINS, SAVINO, VALESKY
 
MLTSPNSR
 
Add 42, amd 208, 210-B, 606 & 615, Tax L; add Art 25 1209 - 1217, 1503-a, Ed L
 
Establishes the "education investment incentives act" and tax credit; provides credits against income and corporate franchise tax for various qualified education investments including scholarships, education funds and home-based instructional materials.
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S01976 Actions:

BILL NOS01976A
 
01/16/2015REFERRED TO RULES
01/21/2015ORDERED TO THIRD READING CAL.17
01/21/2015PASSED SENATE
01/21/2015DELIVERED TO ASSEMBLY
01/21/2015referred to ways and means
01/06/2016died in assembly
01/06/2016returned to senate
01/06/2016REFERRED TO RULES
01/08/2016AMEND AND RECOMMIT TO RULES
01/08/2016PRINT NUMBER 1976A
01/11/2016ORDERED TO THIRD READING CAL.5
01/11/2016PASSED SENATE
01/11/2016DELIVERED TO ASSEMBLY
01/11/2016referred to ways and means
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S01976 Memo:

Memo not available
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S01976 Text:



 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                         1976--A
 
                               2015-2016 Regular Sessions
 
                    IN SENATE
 
                                    January 16, 2015
                                       ___________
 
        Introduced  by  Sens.  GOLDEN,  FELDER, ADDABBO, AVELLA, BONACIC, BOYLE,
          CROCI, DIAZ, FLANAGAN, FUNKE,  GALLIVAN,  HAMILTON,  HASSELL-THOMPSON,
          KLEIN,  LANZA, LARKIN, LATIMER, MARCHIONE, MARTINS, SAVINO, VALESKY --
          read twice and ordered printed, and when printed to  be  committed  to
          the  Committee  on  Rules  -- recommitted to the Committee on Rules in
          accordance with Senate Rule 6, sec. 8 --  committee  discharged,  bill
          amended,  ordered reprinted as amended and recommitted to said commit-
          tee
 
        AN ACT to amend the tax law and the education law, in relation to enact-
          ing the "education investment incentives act"
 
          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 "education investment incentives act".
     3    § 2.  The tax law is amended by adding a new section  42  to  read  as
     4  follows:
     5    §  42.  Education  investment  tax  credit.   (a) Definitions. For the
     6  purposes of this section, the following terms shall have the same  defi-
     7  nition as provided for in article twenty-five of the education law:
     8    "Authorized contribution";
     9    "Contribution";
    10    "Educational program";
    11    "Educational scholarship organization";
    12    "Eligible pupil";
    13    "Local education fund";
    14    "Nonpublic school";
    15    "Public education entity";
    16    "Public school";
    17    "Qualified contribution";
    18    "Qualified educator";
    19    "Qualified school";
 
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD07927-05-6

        S. 1976--A                          2
 
     1    "Scholarship"; and
     2    "School improvement organization".
     3    (b)  Allowance  of  credit.  A  taxpayer  subject to tax under article
     4  nine-A or twenty-two of this chapter shall  be  allowed  credit  against
     5  such  tax,  pursuant  to the provisions referenced in subdivision (l) of
     6  this section, with respect to qualified contributions  made  during  the
     7  taxable year.
     8    (c) Amount of credit. The amount of the credit shall be ninety percent
     9  of  the  taxpayer's total qualified contributions, capped at one million
    10  dollars.  A taxpayer that is a partner in a  partnership,  member  of  a
    11  limited  liability  company  or shareholder in an S corporation shall be
    12  allowed to claim its pro rata share of the credit earned by the partner-
    13  ship, limited liability company or S corporation, provided that  such  a
    14  taxpayer  shall  not  claim credit in excess of the limit imposed by the
    15  preceding sentence.
    16    (d) Information to be posted on the department's website.  The commis-
    17  sioner shall maintain on the department's website a running total of the
    18  amount of available credit for which taxpayers  may  apply  pursuant  to
    19  this  section.    Such  running total shall be updated on a daily basis.
    20  Additionally,  the  commissioner  shall  maintain  on  the  department's
    21  website  a list of the school improvement organizations, local education
    22  funds  and  educational  scholarship  organizations  approved  to  issue
    23  certificates of receipt pursuant to article twenty-five of the education
    24  law.  The commissioner shall also maintain on the department's website a
    25  list  of  public  education  entities, school improvement organizations,
    26  local education funds and educational  scholarship  organizations  whose
    27  approval  to  issue  certificates of receipt has been revoked along with
    28  the date of revocation.
    29    (e) Applications for contribution authorization certificates. Prior to
    30  making a contribution to a public education entity,  school  improvement
    31  organization, local education fund, or educational scholarship organiza-
    32  tion,  the  taxpayer  shall  apply  to the department for a contribution
    33  authorization certificate for such contribution. Such application  shall
    34  be  in the form and manner prescribed by the department.  The department
    35  may allow taxpayers to make multiple  applications  on  the  same  form,
    36  provided  that  each  contribution  listed  on such application shall be
    37  treated as a separate application and that the  department  shall  issue
    38  separate  contribution authorization certificates for each such applica-
    39  tion.
    40    (f) Contribution authorization certificates. 1.   Issuance of  certif-
    41  icates.  The commissioner shall issue contribution authorization certif-
    42  icates  in  two  phases.  In phase one, which begins on the first day of
    43  January and ends on the thirty-first day of  January,  the  commissioner
    44  shall  accept  applications for contribution authorization certificates.
    45  Commencing after the fifth day of February, the commissioner shall issue
    46  contribution authorization certificates for applications received during
    47  phase one, provided that if the aggregate total of the contributions for
    48  which applications have been  received  during  phase  one  exceeds  the
    49  amount  of the credit cap in subdivision (h) of this section, then phase
    50  one of the credit cap application shall be allocated in  two  steps.  In
    51  step one, the allocation shall equal the contribution cap divided by the
    52  total  number  of  applications  for  contributions, rounded down to the
    53  nearest cent. Each application requesting an amount which is  less  than
    54  or equal to the allocation in step one shall receive the amount on their
    55  application for contribution and the difference, which shall be referred
    56  to as "excess distributions" for the purposes of this subdivision, shall

        S. 1976--A                          3
 
     1  be  available for allocation in step two. Each application requesting an
     2  amount which exceeds the allocation in step one shall be allocated cred-
     3  its in step two. In step two, if excess distributions  equal  zero  then
     4  each  application  shall  receive  the  allocation amount from step one,
     5  otherwise each application shall receive an amount equal to the  sum  of
     6  the  (i)  the allocation amount in step one and (ii) a pro rata share of
     7  aggregate excess distributions  based  on  the  difference  between  the
     8  amount  on their application for contribution and the allocation in step
     9  one. For the purposes of this subdivision, multiple applications by  the
    10  same  taxpayer shall be treated as one application. If the credit cap is
    11  not exceeded, phase two commences on  February  twentieth  and  ends  on
    12  October  thirty-first.  During  phase  two  the commissioner shall issue
    13  contribution authorization certificates  on  a  first-come  first  serve
    14  basis  based upon the date the department received the taxpayer's appli-
    15  cation for such certificate.   Contribution  authorization  certificates
    16  for applications received during phase one shall be mailed no later than
    17  the  twentieth  day of February. Contribution authorization certificates
    18  for applications received during phase two shall be mailed  within  five
    19  days of receipt of such applications.
    20    2.  Contribution authorization certificate contents. Each contribution
    21  authorization certificate shall state (i) the date such certificate  was
    22  issued, (ii) the date by which the authorized contribution listed on the
    23  certificate  must be made, which shall be no later than December thirty-
    24  first of the year for which the contribution  authorization  certificate
    25  was  issued,  (iii)  the  amount  of  authorized  contribution, (iv) the
    26  certificate number, (v) the taxpayer's name and address, (vi)  the  name
    27  and address of the public education entity, school improvement organiza-
    28  tion,  local  education  fund or educational scholarship organization to
    29  which the taxpayer may make the authorized contribution, and  (vii)  any
    30  other information that the commissioner deems necessary.
    31    3.  Notification  of  the  issuance  of  a  contribution authorization
    32  certificate. Upon the issuance of a contribution  authorization  certif-
    33  icate  to a taxpayer, the commissioner shall notify the public education
    34  entity, school improvement organization, local education fund or  educa-
    35  tional  scholarship  organization  of  the issuance of such contribution
    36  authorization certificate.  Such  notification  shall  include  (i)  the
    37  taxpayer's  name and address, (ii) the date such certificate was issued,
    38  (iii) the date by  which  the  authorized  contribution  listed  in  the
    39  notification  must  be  made  by  the  taxpayer,  (iv) the amount of the
    40  authorized contribution,  (v)  the  contribution  authorization  certif-
    41  icate's  certificate  number,  and  (vi)  any other information that the
    42  commissioner deems necessary.
    43    (g) Certificate of receipt. 1. In general. No public education entity,
    44  school improvement organization, local education  fund,  or  educational
    45  scholarship  organization  shall  issue a certificate of receipt for any
    46  contribution made by a taxpayer unless  such  public  education  entity,
    47  school  improvement  organization,  local education fund, or educational
    48  scholarship organization has been  approved  to  issue  certificates  of
    49  receipt  pursuant to article twenty-five of the education law. No public
    50  education entity, school improvement organization, local education fund,
    51  or educational scholarship organization shall  issue  a  certificate  of
    52  receipt  for a contribution made by a taxpayer unless such public educa-
    53  tion entity, school improvement organization, local education  fund,  or
    54  educational  scholarship  organization  has  received  notice  from  the
    55  department that  the  department  issued  a  contribution  authorization
    56  certificate to the taxpayer for such contribution.

        S. 1976--A                          4
 
     1    2. Timely contribution. If a taxpayer makes an authorized contribution
     2  to  the  public education entity, school improvement organization, local
     3  education fund, or educational scholarship organization set forth on the
     4  contribution authorization certificate issued to the taxpayer  no  later
     5  than  the  date  by which such authorized contribution is required to be
     6  made, such public education  entity,  school  improvement  organization,
     7  local  education  fund,  or  educational scholarship organization shall,
     8  within thirty days of receipt of the authorized contribution,  issue  to
     9  the  taxpayer  a  certificate of receipt; provided, however, that if the
    10  taxpayer contributes an amount that is less than the  amount  listed  on
    11  the  taxpayer's  contribution  authorization  certificate,  the taxpayer
    12  shall not be issued a certificate of receipt for such contribution.
    13    3. Certificate of receipt contents. Each certificate of receipt  shall
    14  state  (i)  the name and address of the issuing public education entity,
    15  school improvement organization, local education  fund,  or  educational
    16  scholarship  organization,  (ii)  the taxpayer's name and address, (iii)
    17  the date for each contribution, (iv) the amount of each contribution and
    18  the corresponding contribution authorization certificate number, (v) the
    19  total amount of contributions, (vi) certificate of  receipt  number  and
    20  (vii) any other information that the commissioner may deem necessary.
    21    4. Notification to the department for the issuance of a certificate of
    22  receipt.  Upon  the  issuance  of  a certificate of receipt, the issuing
    23  public education entity, school improvement organization,  local  educa-
    24  tion  fund, or educational scholarship organization shall, within thirty
    25  days of issuing the certificate of receipt, provide the department  with
    26  notification  of the issuance of such certificate in the form and manner
    27  prescribed by the department.
    28    5. Notification to the department of the non-issuance of a certificate
    29  of receipt. Each public education entity, school  improvement  organiza-
    30  tion, local education fund, or educational scholarship organization that
    31  received notification from the department pursuant to subdivision (f) of
    32  this  section  regarding  the  issuance  of a contribution authorization
    33  certificate to a taxpayer shall, within thirty days  of  the  expiration
    34  date  for  such  authorized  contribution,  provide  notification to the
    35  department for each taxpayer that failed to make the authorized contrib-
    36  ution to such public education entity, school improvement  organization,
    37  local  education  fund,  or  educational scholarship organization in the
    38  form and manner prescribed by the department.
    39    6. Failure to notify the department. Within thirty days of the discov-
    40  ery of the failure of any public education  entity,  school  improvement
    41  program,  local  education fund, or educational scholarship organization
    42  to comply with the notification requirements  prescribed  by  paragraphs
    43  four and five of this subdivision, the commissioner shall issue a notice
    44  of  compliance  failure  to such entity, program, fund, or organization.
    45  Such entity, program, fund, or organization shall have thirty days  from
    46  the  date  of  such notice to make the notifications prescribed by para-
    47  graphs four and five of this subdivision. Such period  may  be  extended
    48  for  an  additional thirty days upon the request of the entity, program,
    49  fund, or organization. Upon the expiration of period for compliance  set
    50  forth in the notice prescribed by this paragraph, the commissioner shall
    51  notify  the board of regents and the commissioner of education that such
    52  entity, program, fund, or organization failed to make the  notifications
    53  prescribed by paragraphs four and five of this subdivision.
    54    (h)  Credit  cap.  The  maximum  permitted  credits under this section
    55  available to all taxpayers for qualified contributions for calendar year
    56  two thousand seventeen shall be one hundred fifty  million  dollars.  In

        S. 1976--A                          5
 
     1  calendar year two thousand eighteen, the maximum permitted credits under
     2  this section available to all taxpayers shall be two hundred twenty-five
     3  million  dollars  plus  any amounts that are required to be added to the
     4  cap  pursuant to subdivision (i) of this section.  For calendar year two
     5  thousand nineteen and each calendar year thereafter, the maximum permit-
     6  ted credits available to all taxpayers shall be  three  hundred  million
     7  dollars plus any amounts that are required to be added to the cap pursu-
     8  ant  to  subdivision (i) of this section.  The maximum permitted credits
     9  under this section for qualified contributions shall be allocated  fifty
    10  percent  to public education entities, school improvement organizations,
    11  and local education funds and fifty percent to  educational  scholarship
    12  organizations.
    13    (i)  Additions  to  credit cap. Unissued certificates of receipt.  Any
    14  amounts for which the department receives notification  of  non-issuance
    15  of  a  certificate  of  receipt  shall be added to the cap prescribed in
    16  subdivision (h) of this section for the immediately following year.
    17    (j) Regulations. The commissioner is hereby authorized  to  promulgate
    18  and  adopt on an emergency basis regulations necessary for the implemen-
    19  tation of this section.
    20    (k) Written report. On or before the last day of June for each  calen-
    21  dar  year,  for the immediately preceding year, the commissioner and the
    22  commissioner of education shall jointly submit a written report  to  the
    23  governor,  the  temporary  president  of  the senate, the speaker of the
    24  assembly, the chairman of the senate finance committee and the  chairman
    25  of the assembly ways and means committee regarding the education invest-
    26  ment  tax  credit.  Such  report  shall contain information for articles
    27  nine-A and twenty-two, respectively, regarding: (i) the number of appli-
    28  cations received; (ii) the number of and aggregate value of the contrib-
    29  ution authorization certificates  issued  for  contributions  to  public
    30  education  entities,  school  improvement organizations, local education
    31  funds, and scholarship organizations, respectively; (iii) the  geograph-
    32  ical  distribution  by  county  of (A) the applications for contribution
    33  authorization certificates, distribution by county  of  (B)  the  public
    34  education  entities,  school  improvement organizations, local education
    35  funds, and educational scholarship organizations listed  on  the  issued
    36  contribution authorization certificates; and (iv) information, including
    37  geographical  distribution  by  county, of the number of eligible pupils
    38  that received scholarships, the number of qualified schools attended  by
    39  eligible  pupils  that received such scholarships, and the average value
    40  of scholarships received by such eligible pupils. The  commissioner  and
    41  designated  employees  of  the  department,  the  board  of regents, the
    42  commissioner of education and designated employees of the  state  educa-
    43  tion department, shall be allowed and are directed to share and exchange
    44  information regarding the school improvement organizations, local educa-
    45  tion  funds  and  educational scholarship organizations that applied for
    46  approval to be authorized to receive qualified  contributions;  and  the
    47  public  education  entities,  school  improvement  organizations,  local
    48  education funds, and educational scholarship organizations authorized to
    49  issue certificates of receipt, including  information  contained  in  or
    50  derived  from  application  forms and reports submitted to the education
    51  department or board of regents.
    52    (l) Cross references. For application of the credit  provided  for  in
    53  this section, see the following provisions of this chapter:
    54    1. Article 9-A: section 210-B; subdivision 49;
    55    2. Article 22: section 606; subsections (i) and (ccc).

        S. 1976--A                          6
 
     1    §  3.  Paragraph (b) of subdivision 9 of section 208 of the tax law is
     2  amended by adding a new subparagraph 22 to read as follows:
     3    (22)  The  amount  of  any  deduction  allowed pursuant to section one
     4  hundred seventy of the internal revenue  code  for  which  a  credit  is
     5  claimed  pursuant to subdivision forty-nine of section two hundred ten-B
     6  of this article.
     7    § 4. Section 210-B of the tax law is amended by adding a new  subdivi-
     8  sion 49 to read as follows:
     9    49.  Education  investment  tax  credit.  (a)  Allowance  of credit. A
    10  taxpayer shall be allowed a  credit,  to  be  computed  as  provided  in
    11  section forty-two of this chapter, against the tax imposed by this arti-
    12  cle.
    13    (b)  Application  of credit. The credit allowed under this subdivision
    14  for any taxable year shall not reduce the tax due for that year to  less
    15  than  the  higher  of the amounts prescribed in paragraphs (c) or (d) of
    16  subdivision one of section two hundred ten of this article.  However, if
    17  the amount of  credit  allowed  under  this  subdivision  for  qualified
    18  contributions  for  any taxable year reduces the tax to such amount, any
    19  amount of credit not deductible in such taxable year may be carried over
    20  to the succeeding five years and may be deducted from the taxpayer's tax
    21  for such year or years.
    22    § 5. Subparagraph (B) of paragraph 1 of subsection (i) of section  606
    23  of  the  tax  law  is  amended  by  adding a new clause (xli) to read as
    24  follows:
    25  (xli) Education investment           Amount of credit under subdivision
    26  tax credit under subsection (ccc)    forty-nine of section two hundred
    27                                       ten-B
    28    § 6. Section 606  of  the  tax  law  is  amended  by  adding  two  new
    29  subsections (w) and (w-1) to read as follows:
    30    (w)  Home-based  instructional materials credit. (1) For taxable years
    31  beginning on or after January first, two thousand seventeen, a  taxpayer
    32  shall  be  allowed  a credit against the tax imposed by this article for
    33  the purchase  of  instructional  materials  approved  by  the  education
    34  department  or  board of regents for use in non-public home-based educa-
    35  tional programs; provided, that the amount of credit  claimed  does  not
    36  exceed  the  lesser of two hundred dollars or one hundred percent of the
    37  cost of such purchases made by the taxpayer during the taxable year.
    38    (2) A husband and wife who file separate returns for a taxable year in
    39  which they could have filed a joint return may each claim only  one-half
    40  of the tax credit that would have been allowed for a joint return.
    41    (3)  If the amount of the credit allowed under this subsection for any
    42  taxable year shall exceed the taxpayer's tax for such year,  the  excess
    43  shall  be treated as an overpayment of tax to be credited or refunded in
    44  accordance with the provisions of section six hundred eighty-six of this
    45  article, provided, however, that no interest shall be paid thereon.
    46    (w-1) Instructional materials and supplies credit.   (1)  For  taxable
    47  years  beginning  on  and after January first, two thousand seventeen, a
    48  taxpayer shall be allowed a credit equal to the  lesser  of  the  amount
    49  paid by the taxpayer during the taxable year for instructional materials
    50  and  supplies,  or  two hundred dollars; provided that the taxpayer is a
    51  teacher or instructor in a  qualified  school,  as  defined  in  section
    52  forty-two  of  this  chapter,  for  at least nine hundred hours during a
    53  school year. For purposes of this subsection, the  term  "materials  and
    54  supplies" means instructional materials or supplies that are used in the
    55  classroom in any qualified school.

        S. 1976--A                          7

     1    (2) A husband and wife who file separate returns for a taxable year in
     2  which  they could have filed a joint return may each claim only one-half
     3  of the tax credit that would have been allowed for a joint return.
     4    (3)  If the amount of the credit allowed under this subsection for any
     5  taxable year shall exceed the taxpayer's tax for such year,  the  excess
     6  shall  be treated as an overpayment of tax to be credited or refunded in
     7  accordance with the provisions of section six hundred eighty-six of this
     8  article, provided, however, that no interest shall be paid thereon.
     9    § 7. Section 606 of the tax law is amended by adding a new  subsection
    10  (ccc) to read as follows:
    11    (ccc)  Education  investment  tax  credit.  (1) Allowance of credit. A
    12  taxpayer shall be allowed a credit to be computed as provided in section
    13  forty-two of this chapter, against the tax imposed by this article.
    14    (2) Application of credit. If the amount of the credit  allowed  under
    15  this  subsection  for  any  qualified contributions for any taxable year
    16  exceeds the taxpayer's tax for such year, the excess may be carried over
    17  to the succeeding five years and may be deducted from the taxpayer's tax
    18  for such year or years.
    19    § 8. Subsection (c) of section 615 of the tax law is amended by adding
    20  a new paragraph 9 to read as follows:
    21    (9) The amount of any federal deduction  for  contributions  made  for
    22  which  a  taxpayer claims a credit under subsection (ccc) of section six
    23  hundred six of this article.
    24    § 9. The education law is amended by adding a new article 25  to  read
    25  as follows:
    26                                 ARTICLE 25
    27                   EDUCATION INVESTMENT TAX CREDIT PROGRAM
    28  Section 1209. Short title.
    29          1210. Definitions.
    30          1211. Approval to issue certificates of receipt.
    31          1212. Applications   for   approval  to  issue  certificates  of
    32                  receipt.
    33          1213. Application approval.
    34          1214. Revocation of approval to issue certificates of receipt.
    35          1215. Recordkeeping.
    36          1216. Joint annual report.
    37          1217. Commissioner; powers.
    38    § 1209. Short title. This article shall be known and may be  cited  as
    39  the "education investment tax credit program".
    40    §  1210.  Definitions.  As  used  in this article, the following terms
    41  shall have the following meanings:
    42    1. "Authorized contribution" means the contribution amount  listed  on
    43  the contribution authorization certificate issued to a taxpayer.
    44    2.  "Contribution"  means  a  donation paid by cash, check, electronic
    45  funds transfer, debit card or credit card made by  the  taxpayer  during
    46  the tax year.
    47    3.  "Educational program" means an academic program of a public school
    48  that enhances the curriculum, or provides or expands a  pre-kindergarten
    49  program or an after-school program to the public school. For purposes of
    50  this  definition,  the  instruction, materials, programs or other activ-
    51  ities offered by or through an educational program may include, but  are
    52  not  limited  to,  the  following features: (a) instruction or materials
    53  promoting health, physical education, and family and consumer  sciences;
    54  literary, performing and visual arts; mathematics, social studies, tech-
    55  nology  and  scientific  achievement;  (b) instruction or programming to
    56  meet the education needs of at-risk students or students with  disabili-

        S. 1976--A                          8
 
     1  ties,  including  tutoring  or  counseling;  or  (c)  use of specialized
     2  instructional materials, instructors or instruction not  provided  by  a
     3  public school.
     4    4. "Educational scholarship organization" means a not-for-profit enti-
     5  ty which (a) is exempt from taxation under paragraph three of subsection
     6  (c)  of  section  five  hundred  one  of  the internal revenue code, (b)
     7  commits for the expenditure of at least ninety percent  of  the  revenue
     8  from  qualified  contributions received during the calendar year and any
     9  income derived from qualified contributions for scholarships, (c) depos-
    10  its and holds qualified contributions and any income derived from quali-
    11  fied contributions in an account that is  separate  from  the  organiza-
    12  tion's  operating  or  other funds until such qualified contributions or
    13  income are withdrawn for use, and (d) provides scholarships to  eligible
    14  pupils for use at no fewer than three qualified schools.
    15    5. "Eligible pupil" means a child who (a) is a resident of this state,
    16  (b)  is school age in accordance with subdivision one of section thirty-
    17  two hundred two of this chapter or who is four years of age on or before
    18  December first of the year in which they are enrolled in  a  pre-kinder-
    19  garten  program,  (c)  attends or is about to attend a qualified school,
    20  and (d) resides in a household that has a federal adjusted gross  income
    21  of  five  hundred thousand dollars or less, provided however, for house-
    22  holds with three or more dependent children, such income level shall  be
    23  increased  by ten thousand dollars per dependent child in excess of two,
    24  not to exceed five hundred fifty thousand dollars.
    25    6. "Local education fund" means a not-for-profit entity which  (a)  is
    26  exempt  from taxation under paragraph three of subsection (c) of section
    27  five hundred one of the internal revenue code, (b)  is  established  for
    28  the  purpose of supporting an educational program in at least one public
    29  school, or public school district, (c) uses at least ninety  percent  of
    30  the  qualified  contributions  received during the calendar year and any
    31  income derived from qualified contributions to support the public school
    32  or schools or public school district or districts  that  such  fund  has
    33  been  established  to  support,  and  (d)  deposits  and holds qualified
    34  contributions and any income derived from qualified contributions in  an
    35  account  that is separate from the fund's operating or other funds until
    36  such qualified contributions or income are withdrawn for use.
    37    7.  "Nonpublic  school"  means  any  not-for-profit   pre-kindergarten
    38  program  or  elementary,  secondary  sectarian  or  nonsectarian  school
    39  located in this state, other than a public  school,  that  is  providing
    40  instruction  at  one  or  more locations to a student in accordance with
    41  subdivision two of section thirty-two hundred four of this chapter.
    42    8. "Public education entity" means a public school or a public  school
    43  district,  provided  that  such public school, or public school district
    44  deposits and holds qualified contributions and any income  derived  from
    45  qualified  contributions  in an account that is separate from the public
    46  school or public school district's operating or other funds  until  such
    47  qualified contributions or income are withdrawn for use, and is approved
    48  to issue certificates of receipt pursuant to this article.
    49    9.  "Public  school"  means any free elementary or secondary school in
    50  this state guaranteed by article eleven of the constitution  or  charter
    51  school authorized by article fifty-six of this chapter.
    52    10. "Qualified contribution" means the authorized contribution made by
    53  a  taxpayer to the public education entity, school improvement organiza-
    54  tion, local education fund, or educational scholarship organization that
    55  is listed on the contribution authorization certificate  issued  to  the
    56  taxpayer  and  for  which  the  taxpayer  has  received a certificate of

        S. 1976--A                          9
 
     1  receipt from such entity, fund, or organization.   A  contribution  does
     2  not qualify if the taxpayer designates the taxpayer's contribution to an
     3  entity or organization for the direct benefit of any particular or spec-
     4  ified student.
     5    11.  "Qualified  educator"  means  an  individual  who is a teacher or
     6  instructor in a qualified school for at least nine hundred hours  during
     7  a school year.
     8    12. "Qualified school" means a public school or nonpublic school.
     9    13.  "Scholarship"  means  an educational scholarship which provides a
    10  tuition grant awarded to an eligible pupil to attend a qualified  school
    11  in  an  amount  not  to exceed the tuition charged to attend such school
    12  less any other educational scholarship received by such  eligible  pupil
    13  or  his  or  her  parent,  parents or guardian for such eligible pupil's
    14  tuition; provided, however, in the case of an eligible pupil attending a
    15  public school in a public school district of which such pupil is  not  a
    16  resident,  the  amount  of  the  educational scholarship awarded may not
    17  exceed the tuition charged by the public school pursuant to paragraph  d
    18  of  subdivision  four  of section thirty-two hundred two of this chapter
    19  less any other educational scholarship received by such  eligible  pupil
    20  or  his  or  her  parent,  parents or guardian for such eligible pupil's
    21  tuition, but only if the public school district of which such pupil is a
    22  resident is not required to pay for such tuition.
    23    14. "School improvement organization" means  a  not-for-profit  entity
    24  which  (i)  is  exempt from taxation under paragraph three of subsection
    25  (c) of section five hundred one of the internal revenue code, (ii)  uses
    26  at  least  ninety percent of the qualified contributions received during
    27  the calendar year and any income derived from  such  qualified  contrib-
    28  utions  to  assist  public schools or public school districts located in
    29  this state in their provision of educational programs, either by  making
    30  contributions  to  one or more public schools or public school districts
    31  located in this state  or  providing  educational  programs  to,  or  in
    32  conjunction  with, one or more public schools or public school districts
    33  located in this state, (iii) deposits and holds qualified  contributions
    34  and  any  income derived from such qualified contributions in an account
    35  that is separate from the organization's operating or other funds  until
    36  such  qualified  contributions or income are withdrawn for use, and (iv)
    37  is approved to issue certificates of receipt pursuant to  this  article.
    38  Such  entity  may  allow  the taxpayer to choose to donate to a program,
    39  project or initiative identified by a qualified educator for  use  in  a
    40  public school.
    41    §  1211.  Approval to issue certificates of receipt. 1. Public schools
    42  and public school  districts.  All  public  schools  and  public  school
    43  districts  shall  be approved to issue certificates of receipt provided,
    44  that a public school or public school district shall not be approved  if
    45  either  (a) the public school or public school district fails to deposit
    46  and hold qualified contributions and any income derived  from  qualified
    47  contributions  in  an account that is separate from the school or school
    48  district's operating or other funds until such  qualified  contributions
    49  or income are withdrawn for use, or (b) the board of regents has revoked
    50  such  approval for such public school or public school district pursuant
    51  to section twelve hundred fourteen of this article.
    52    2. School improvement organizations, educational scholarship organiza-
    53  tions and local education funds.  No  school  improvement  organization,
    54  educational scholarship organization or local education fund shall issue
    55  any  certificates  of  receipt without filing an application pursuant to

        S. 1976--A                         10
 
     1  section twelve hundred twelve of this  article  and  receiving  approval
     2  pursuant to section twelve hundred thirteen of this article.
     3    §  1212.  Applications  for approval to issue certificates of receipt.
     4  Each school improvement organization, educational scholarship  organiza-
     5  tion,  and local education fund shall submit an application to the board
     6  of regents for approval to issue certificates of receipt in the form and
     7  manner prescribed by the board; provided  that  such  application  shall
     8  include:  (a)  submission  of documentation that such school improvement
     9  organization, local education fund or educational scholarship  organiza-
    10  tion  has  been granted exemption from taxation under paragraph three of
    11  subsection (c) of section five hundred one of the internal revenue code;
    12  (b) the most recent annual financial audit, which shall be completed  by
    13  an  independent  certified  public  accountant  and  a list of names and
    14  addresses of all members of the governing board of the  school  improve-
    15  ment  organization,  local  education  fund  or  educational scholarship
    16  organization; and (c)  an  educational  scholarship  organization  shall
    17  provide  criteria for the awarding of scholarships to eligible students.
    18  The board of regents, commissioner or department shall not  require  any
    19  other  information  for  such  application  except as authorized in this
    20  article or by section forty-two of the tax law.
    21    § 1213. Application approval. The board of regents shall  review  each
    22  application  to  issue certificates of receipt pursuant to this article.
    23  Approval or denial of an application shall be made at the next scheduled
    24  meeting of the board of regents that follows the receipt of such  appli-
    25  cation, but not later than the next meeting thereafter.
    26    §  1214.  Revocation of approval to issue certificates of receipt. The
    27  board of regents, in consultation with the commissioner of taxation  and
    28  finance,  may  revoke the approval of a school improvement organization,
    29  educational  scholarship  organization,  local  education  fund,  public
    30  school or public school district to issue certificates of receipt upon a
    31  finding  that  such  organization,  fund,  school or school district has
    32  violated this article  or  section  forty-two  of  the  tax  law.  These
    33  violations  shall  include, but not be limited to, any of the following:
    34  (a) failure to meet the requirements of this article or  section  forty-
    35  two  of  the  tax  law,  (b)  the  failure to maintain full and adequate
    36  records with respect to the receipt of qualified contributions, (c)  the
    37  failure  to supply such records to the commissioner, department of taxa-
    38  tion and finance or board of regents when requested by the department or
    39  board, or (d) the failure to provide notice to the department  of  taxa-
    40  tion  and  finance  of  the  issuance  or nonissuance of certificates of
    41  receipt pursuant to section forty-two of the tax law; provided  however,
    42  that  the  board  of  regents shall not revoke approval pursuant to this
    43  section based upon a violation of the tax law unless the commissioner of
    44  taxation and finance agrees that revocation is warranted;  and  provided
    45  further  that  the  board  shall  not  revoke  approval pursuant to this
    46  section when the failure to comply is due  to  clerical  error  and  not
    47  negligence or intentional disregard for the law. Within five days of the
    48  determination  revoking approval, the board shall provide notice of such
    49  revocation to the educational scholarship organization, school  improve-
    50  ment organization, local education fund, public school, or public school
    51  district and to the department of taxation and finance.
    52    §  1215.  Recordkeeping.  Each school improvement organization, educa-
    53  tional scholarship organization, local education fund, public school and
    54  public school district that issued at least one certificate  of  receipt
    55  shall  maintain  records  including  (a) notifications received from the
    56  department of taxation  and  finance,  (b)  notifications  made  to  the

        S. 1976--A                         11
 
     1  department  of  taxation  and  finance, (c) copies of qualified contrib-
     2  utions received, (d) copies of the deposit of  such  qualified  contrib-
     3  utions,  (e) copies of issued certificates of receipt, (f) annual finan-
     4  cial  statements,  (g)  in the case of school improvement organizations,
     5  educational scholarship organizations and  local  education  funds,  the
     6  application  submitted pursuant to section twelve hundred twelve of this
     7  article and the approval issued by the board of  regents,  and  (h)  any
     8  other information as prescribed by regulation promulgated by the commis-
     9  sioner or rule promulgated by the board of regents.
    10    §  1216.  Joint  annual  report. On or before the last day of June for
    11  each calendar year, the commissioner of taxation  and  finance  and  the
    12  commissioner,  jointly,  shall  submit  a  written report as provided in
    13  subdivision (k) of section forty-two of the tax law.
    14    § 1217. Commissioner; powers. The commissioner shall promulgate on  an
    15  emergency  basis  regulations  necessary  for the implementation of this
    16  section. The commissioner shall make  any  application  required  to  be
    17  filed pursuant to this article available to applicants within sixty days
    18  of the effective date of this article.
    19    §  10.  The education law is amended by adding a new section 1503-a to
    20  read as follows:
    21    § 1503-a. Power to accept and solicit gifts and  donations.    1.  All
    22  school districts organized by special laws or pursuant to the provisions
    23  of  a  general  law are hereby authorized and empowered to accept gifts,
    24  donations, and contributions to the district and to solicit the same.
    25    2. Notwithstanding any other provision of this chapter or of any other
    26  general or special law to the  contrary,  the  receipt  of  such  gifts,
    27  donations,  contributions and other funds, and any income derived there-
    28  from, shall be disregarded  for  the  purposes  of  all  apportionments,
    29  computations, and determinations of state aid.
    30    §  11.  Severability. If any provision of this section or the applica-
    31  tion thereof to any person or circumstances is held invalid, such  inva-
    32  lidity  shall not affect other provisions or applications of the section
    33  which can be given effect without the invalid provision or  application,
    34  and to this end the provisions of this section are declared to be sever-
    35  able.
    36    §  12. This act shall take effect immediately and shall apply to taxa-
    37  ble years beginning after December 31, 2016.
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