S00602 Summary:

BILL NOS00602A
 
SAME ASSAME AS A04474-A
 
SPONSORGIANARIS
 
COSPNSR
 
MLTSPNSR
 
Amd §2799-hh, add §1270-k, Pub Auth L; add §1304-E, amd §§1310 & 1313, Tax L; add §11-1704.2, amd §11-1706, NYC Ad Cd
 
Authorizes the city of New York to impose a personal income surcharge on high income residents to fund transit improvements.
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S00602 Actions:

BILL NOS00602A
 
01/05/2023REFERRED TO TRANSPORTATION
11/01/2023AMEND AND RECOMMIT TO TRANSPORTATION
11/01/2023PRINT NUMBER 602A
01/03/2024REFERRED TO TRANSPORTATION
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S00602 Committee Votes:

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S00602 Floor Votes:

There are no votes for this bill in this legislative session.
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S00602 Text:



 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                         602--A
 
                               2023-2024 Regular Sessions
 
                    IN SENATE
 
                                     January 5, 2023
                                       ___________
 
        Introduced  by Sen. GIANARIS -- read twice and ordered printed, and when
          printed to be committed to the Committee on Transportation --  commit-
          tee  discharged, bill amended, ordered reprinted as amended and recom-
          mitted to said committee
 
        AN ACT to amend the public authorities law, the tax law and the adminis-
          trative code of the city of New York, in relation to  authorizing  and
          imposing a tax surcharge on the personal income of certain high-income
          residents  of  such  city  in  order  to  fund  transit infrastructure
          improvements
 
          The People of the State of New York, represented in Senate and  Assem-
        bly, do enact as follows:
 
     1    Section  1.  The  public  authorities  law  is amended by adding a new
     2  section 1270-k to read as follows:
     3    § 1270-k. New York city dedicated personal income tax surcharge  fund.
     4  1.  The  authority  shall  establish a fund to be known as the "New York
     5  city dedicated personal income tax surcharge fund" which shall  be  kept
     6  separate  from  and shall not be commingled with any other moneys of the
     7  authority.
     8    2. There shall be deposited into the New York city dedicated  personal
     9  income  tax  surcharge  fund  the moneys transferred to the metropolitan
    10  transportation authority from the New  York  city  transitional  finance
    11  authority  pursuant to subsection (e) of section thirteen hundred four-E
    12  of the tax law, and any other provision of law directing  or  permitting
    13  the  deposit  of  moneys  in  such  fund, to be used exclusively for the
    14  financing of transit infrastructure improvements.
    15    3. Moneys in the New York city dedicated personal income tax surcharge
    16  fund (a) shall be used to fund capital projects that satisfy the follow-
    17  ing criteria: (i) defined as state of good repair,  normal  replacement,
    18  or  an Americans with Disabilities Act related system improvement within
    19  the capital program of the authority; and (ii) included in  any  of  the
    20  following  categories  within  the capital program of the authority: New
 
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD03039-03-3

        S. 602--A                           2
 
     1  York city transit authority buses, subway cars, track,  line  equipment,
     2  line  structures,  signals and communications, traction power, shops and
     3  yards, depots, service vehicles, passenger station projects,  as  needed
     4  to  comply with the Americans with Disabilities Act, Staten Island rail-
     5  way and authority bus company projects; and (b) may be  (i)  pledged  by
     6  the  authority  as security for the payment of principal and interest on
     7  bonds issued after July first, two thousand twenty-four to finance capi-
     8  tal projects that meet the criteria identified in paragraph (a) of  this
     9  subdivision,  including  bonds issued to refund such bonds and (ii) used
    10  for payment of principal and interest on such bonds, funding of reserves
    11  required in connection with such bonds, and  the  payment  of  costs  of
    12  issuance  related  to  such  bonds. To the extent moneys in the New York
    13  city dedicated  personal income tax surcharge fund have been pledged  by
    14  the  authority  to secure the payment of principal and interest on bonds
    15  as herein provided, moneys deposited into the New  York  city  dedicated
    16  personal income tax surcharge fund shall first be deposited into the New
    17  York  city  dedicated  personal  income tax surcharge fund to the extent
    18  necessary to make payments pursuant to paragraph (b)  of  this  subdivi-
    19  sion.  After making such payments, moneys deposited in the New York city
    20  dedicated personal income tax surcharge  fund  shall  be  used  to  fund
    21  projects  that  meet  the  criteria  identified in paragraph (a) of this
    22  subdivision.
    23    4. The state does hereby pledge and agree  with  the  holders  of  any
    24  issue  of bonds secured by pledge described in paragraph (b) of subdivi-
    25  sion three of this section that the state will not limit  or  alter  the
    26  rights  hereby  vested  in  the metropolitan transportation authority to
    27  fulfill the terms of any agreements made with  bondholders  pursuant  to
    28  this title, or in any way impair the rights and remedies of such holders
    29  or  the  security  for  such  bonds  until such bonds are fully paid and
    30  discharged. Nothing  contained  in  this  section  shall  be  deemed  to
    31  restrict  the  right  of the state to amend, modify, repeal or otherwise
    32  alter statutes imposing or relating to the taxes payable to the New York
    33  city transitional finance authority pursuant to section thirteen hundred
    34  thirteen of the tax law, but such taxes shall in all events continue  to
    35  be  so  payable  so  long as any such taxes are imposed. Nothing in this
    36  section shall be deemed to obligate the state  to  make  any  additional
    37  payments  or impose any taxes to satisfy the debt service obligations of
    38  the metropolitan transportation authority.
    39    5. Twice each calendar year, the mayor of the city of New  York  shall
    40  conduct  a review of the amount of moneys deposited in the New York city
    41  dedicated  personal income tax surcharge fund. To the extent such review
    42  indicates that the moneys in the New York city dedicated personal income
    43  tax surcharge fund are sufficient to satisfy  the  requirements  of  any
    44  debt  service  incurred in such calendar year as a result of obligations
    45  issued and secured pursuant to paragraph (b)  of  subdivision  three  of
    46  this section.
    47    §  2.  Subdivision 5 of section 2799-hh of the public authorities law,
    48  as amended by section 6 of subpart B of part MM of  chapter  59  of  the
    49  laws of 2022, is amended to read as follows:
    50    5.  Tax  revenues received by the authority pursuant to subsection (d)
    51  of section eight hundred  seventy-three,  or  section  thirteen  hundred
    52  thirteen,  of  the  tax  law,  together  with  any  alternative revenues
    53  received by the authority, shall be applied in the  following  order  of
    54  priority:  first pursuant to the authority's contracts with bondholders,
    55  then to pay the authority's operating expenses  not  otherwise  provided
    56  for,  then to a dedicated personal income tax surcharge fund pursuant to

        S. 602--A                           3
 
     1  subsection  (d) of section thirteen hundred four-E of the tax law in the
     2  amount provided for in such section, and then pursuant to  the  authori-
     3  ty's  agreements  with  the  city,  which  agreements  shall require the
     4  authority  to  transfer  the  balance of such taxes not required to meet
     5  contractual or other  obligations  of  the  authority  to  the  city  as
     6  frequently as practicable.
     7    §  3. The tax law is amended by adding a new section 1304-E to read as
     8  follows:
     9    § 1304-E. Tax surcharge for transit infrastructure  improvements.  (a)
    10  In  addition  to the taxes authorized by subsection (a) of section thir-
    11  teen hundred one of this article, any city imposing such taxes is hereby
    12  authorized and empowered to adopt and amend local laws imposing  in  any
    13  such  city  for  each  taxable year beginning after two thousand twenty-
    14  four, a tax surcharge on the city taxable income of certain  city  resi-
    15  dent individuals, estates and trusts.
    16    (b)  A tax surcharge imposed pursuant to the authority of this section
    17  shall be determined as follows:
    18    (1) Resident married individuals filing  joint  returns  and  resident
    19  surviving  spouses.  The  tax  surcharge  under this section on the city
    20  taxable income of certain city resident married individuals who  make  a
    21  single  return  jointly  with  his or her spouse under subsection (b) of
    22  section thirteen hundred six of this article and  on  the  city  taxable
    23  income of certain city resident surviving spouses shall be determined in
    24  accordance with the following table:
    25    For taxable years beginning after two thousand twenty:
    26    If the city taxable income is:        The tax surcharge is:
    27    Over $1,000,000                       .534% of excess over $1,000,000
    28    (2) Resident heads of households. The tax surcharge under this section
    29  on  the city taxable income of certain city resident heads of households
    30  shall be determined in accordance with the following table:
    31    For taxable years beginning after two thousand twenty:
    32    If the city taxable income is:           The tax surcharge is:
    33    Over $750,000                            .534% of excess over $750,000
    34    (3)  Resident  unmarried  individuals,  resident  married  individuals
    35  filing  separate  returns  and  resident  estates  and  trusts.  The tax
    36  surcharge under this section on the city taxable income of certain  city
    37  resident  individuals  who are not city resident married individuals who
    38  make a single return jointly with his or her spouse under subsection (b)
    39  of section thirteen hundred six of this article or city  resident  heads
    40  of  households or city resident surviving spouses, and on the city taxa-
    41  ble income of certain city resident estates and trusts shall  be  deter-
    42  mined in accordance with the following table:
    43    For taxable years beginning after two thousand twenty:
    44    If the city taxable income is:           The tax surcharge is:
    45    Over $500,000                            .534% of excess over $500,000
    46    (c)  A tax surcharge imposed pursuant to the authority of this section
    47  shall be administered and collected in the  same  manner  as  the  taxes
    48  imposed  pursuant  to  the  authority  of  this  article, and all of the
    49  provisions of this article,  including  section  thirteen  hundred  ten,
    50  shall  apply  to  the tax surcharge imposed pursuant to the authority of
    51  this section.
    52    (d) Subject to the priority of payments identified in section  twenty-
    53  seven hundred ninety-nine-hh of the public authorities law, the New York
    54  city  transitional  finance authority shall transfer to the metropolitan
    55  transportation authority the amount estimated by the mayor of  the  city
    56  of  New York to be the amount received by the New York city transitional

        S. 602--A                           4
 
     1  finance authority from the tax surcharge imposed pursuant to the author-
     2  ity of this section, up to the total amount  available  after  deducting
     3  from revenues received by the New York city transitional finance author-
     4  ity  pursuant  to  this  section  and subsection (c) of section thirteen
     5  hundred thirteen of this article amounts to be paid pursuant to the  New
     6  York  city  transitional  finance authority's contracts with bondholders
     7  and  the  New  York  city  transitional  finance  authority's  operating
     8  expenses  not otherwise provided for. After the mayor of the city of New
     9  York has received data from the department allowing such mayor to deter-
    10  mine the actual amount of revenues received by the New York city transi-
    11  tional finance authority that are  attributable  to  the  tax  surcharge
    12  imposed  pursuant  to  the  authority  of this section, such mayor shall
    13  inform the New York city transitional finance authority of  such  actual
    14  amount.
    15    (e)  Any  revenues  transferred  to  the  metropolitan  transportation
    16  authority pursuant to subsection (d) of this section shall be paid  into
    17  a  dedicated  personal  income tax surcharge fund to be used exclusively
    18  for the financing of transit infrastructure improvements  in  accordance
    19  with  the  provisions  of section twelve hundred seventy-k of the public
    20  authorities law. Such revenues  shall  only  supplement  and  shall  not
    21  supplant any federal, state, or local funds expended by the metropolitan
    22  transportation authority for New York city transit authority, the metro-
    23  politan  transportation  authority  bus  company  or Staten Island rapid
    24  transit operating authority projects, and shall not affect  any  payment
    25  by the city of New York pursuant to agreements relating to the metropol-
    26  itan transportation authority bus company and Staten Island rapid trans-
    27  it operating authority.
    28    §  4.  Paragraphs 1 and 2 of subsection (e) of section 1310 of the tax
    29  law, as added by chapter 481 of the laws of 1997, are amended to read as
    30  follows:
    31    (1) Notwithstanding any other provision of law to  the  contrary,  any
    32  city  imposing  a  tax  under  this  article  is  hereby  authorized and
    33  empowered to adopt and amend local laws for any taxable  year  beginning
    34  after  nineteen  hundred  ninety-seven, as specified in such local laws,
    35  providing for a credit as provided in paragraph two of  this  subsection
    36  against  the  taxes imposed pursuant to the authority granted by section
    37  thirteen hundred one of this article on the city taxable  income  deter-
    38  mined  pursuant  to  sections  thirteen  hundred  four, thirteen hundred
    39  four-A [and], thirteen hundred four-B and  thirteen  hundred  four-E  of
    40  this  article  and on the ordinary income portion of a lump sum distrib-
    41  ution determined pursuant to section  thirteen  hundred  one-B  of  this
    42  article,  to  any  city  resident individual, estate or trust whose city
    43  adjusted gross income includes income, gain, loss or deductions from one
    44  or more unincorporated businesses conducted by such city resident  indi-
    45  vidual,  estate  or  trust  on which a tax is imposed by chapter five of
    46  title eleven of the administrative code of the city of New  York,  or  a
    47  distributive  share  of income, gain, loss and deductions of, or guaran-
    48  teed payments from, one or more partnerships on which a tax  is  imposed
    49  by  such  chapter.  Any such local laws may contain provisions to ensure
    50  that such credit shall not reduce the tax paid by a city resident  below
    51  that  which  would  be  paid by such city resident if such city resident
    52  were a city nonresident.
    53    (2) (A) Subject to the limitation set forth  in  subparagraph  (B)  of
    54  this  paragraph,  the  credit  allowed  to a taxpayer for a taxable year
    55  shall be equal to all or a portion of the amount determined in paragraph

        S. 602--A                           5
 
     1  three of this subsection, provided, however, such portion shall  not  be
     2  less than:
     3    (i)  If the city taxable income is forty-two thousand dollars or less,
     4  sixty-five percent of the amount determined in paragraph three  of  this
     5  subsection.
     6    (ii)  If  the  city  taxable income is greater than forty-two thousand
     7  dollars but not greater than one hundred forty-two thousand  dollars,  a
     8  percentage   of  the  amount  determined  in  paragraph  three  of  this
     9  subsection to be determined by subtracting from sixty-five percent,  one
    10  tenth  of  a  percentage point (.001) for every increment of two hundred
    11  dollars, or fractional part thereof, of city taxable income in excess of
    12  forty-two thousand dollars.
    13    (iii) If the city taxable income is greater than one hundred forty-two
    14  thousand dollars, fifteen percent of the amount determined in  paragraph
    15  three of this subsection.
    16    (B)  Notwithstanding  anything  to the contrary in subparagraph (A) of
    17  this paragraph, the credit allowed to a  taxpayer  for  a  taxable  year
    18  under  this  subsection shall not exceed the sum of the taxes that would
    19  otherwise be imposed on such taxpayer for such taxable year pursuant  to
    20  the authority granted by section thirteen hundred one of this article on
    21  the city taxable income determined pursuant to sections thirteen hundred
    22  four,  thirteen  hundred four-A [and], thirteen hundred four-B and thir-
    23  teen hundred four-E of this article and on the ordinary  income  portion
    24  of  a  lump  sum  distribution  determined  pursuant to section thirteen
    25  hundred one-B of this article, reduced by the credits  allowed  to  such
    26  taxpayer pursuant to subsections (a), (c) and (d) of this section.
    27    §  5.  The  opening paragraph of subsection (c) of section 1313 of the
    28  tax law, as amended by section 8 of part C of chapter 58 of the laws  of
    29  2005, is amended to read as follows:
    30    Subject to the provisions of subsection (g) of this section, the comp-
    31  troller, after reserving such refund fund and such costs shall, commenc-
    32  ing  on  or  before the fifteenth day of each month, pay to the New York
    33  city transitional finance authority on a  daily  basis  the  balance  of
    34  taxes  imposed pursuant to the authority of this article or former arti-
    35  cle two-E of the general city law to be applied by the authority, in the
    36  following order of priority: first pursuant to the authority's contracts
    37  with bondholders, then to pay the  authority's  operating  expenses  not
    38  otherwise  provided  for,  then  to  a  dedicated  personal  income  tax
    39  surcharge fund pursuant to subsection (d) of  section  thirteen  hundred
    40  four-E  of  this article and then pursuant to the authority's agreements
    41  with the city, which agreements shall require the authority to  transfer
    42  the  balance  of  such  taxes  not required to meet contractual or other
    43  obligations of the authority to the city as frequently  as  practicable;
    44  except that the comptroller shall:
    45    §  6.  The  administrative  code of the city of New York is amended by
    46  adding a new section 11-1704.2 to read as follows:
    47    § 11-1704.2 Tax surcharge for transit infrastructure improvements. (a)
    48  In addition to the taxes imposed by sections 11-1701,  11-1703,  11-1704
    49  and 11-1704.1 of this subchapter, there is hereby imposed for each taxa-
    50  ble  year  beginning  after two thousand twenty-four, a tax surcharge on
    51  the city taxable income of certain city  resident  individuals,  estates
    52  and trusts.
    53    (b) The tax surcharge imposed pursuant to this section shall be deter-
    54  mined as follows:
    55    (1)  Resident  married  individuals  filing joint returns and resident
    56  surviving spouses. The tax surcharge under  this  section  on  the  city

        S. 602--A                           6

     1  taxable  income  of certain city resident married individuals who make a
     2  single return jointly with his or her spouse under  subdivision  (b)  of
     3  section  11-1751  of  this  chapter  and  on  the city taxable income of
     4  certain  city  resident surviving spouses shall be determined in accord-
     5  ance with the following table:
     6    For taxable years beginning after two thousand twenty:
     7    If the city taxable income is:        The tax surcharge is:
     8    Over $1,000,000                       .534% of excess over $1,000,000
     9    (2) Resident heads of households. The tax surcharge under this section
    10  on the city taxable income of certain city resident heads of  households
    11  shall be determined in accordance with the following table:
    12    For taxable years beginning after two thousand twenty:
    13    If the city taxable income is:           The tax surcharge is:
    14    Over $750,000                            .534% of excess over $750,000
    15    (3)  Resident  unmarried  individuals,  resident  married  individuals
    16  filing separate  returns  and  resident  estates  and  trusts.  The  tax
    17  surcharge  under this section on the city taxable income of certain city
    18  resident individuals who are not city resident married  individuals  who
    19  make  a  single  return jointly with his or her spouse under subdivision
    20  (b) of section 11-1751 of this chapter or city resident heads of  house-
    21  holds or city resident surviving spouses, and on the city taxable income
    22  of  certain  city  resident  estates  and  trusts shall be determined in
    23  accordance with the following table:
    24    For taxable years beginning after two thousand twenty:
    25    If the city taxable income is:           The tax surcharge is:
    26    Over $500,000                            .534% of excess over $500,000
    27    (c) The tax surcharge imposed pursuant to this section shall be admin-
    28  istered and collected in the same manner as the taxes  imposed  pursuant
    29  to  sections  11-1701,  11-1703,  11-1704  and  11-1704.1,  and shall be
    30  distributed in accordance with subsection (d) of section 1304-E  of  the
    31  tax  law,  and  all of the provisions of this chapter, including section
    32  11-1706 of this subchapter, and sections 11-1721  and  11-1773  of  this
    33  chapter,  shall  apply  to  the  tax  surcharge imposed pursuant to this
    34  section.
    35    § 7. Paragraphs 1 and 2 of subdivision (c) of section 11-1706  of  the
    36  administrative  code of the city of New York, as added by chapter 481 of
    37  the laws of 1997, subparagraph (A) of paragraph 2 as  amended  by  local
    38  law  number 35 of the city of New York for the year 2007, are amended to
    39  read as follows:
    40    (1) A city resident individual, estate or trust  whose  city  adjusted
    41  gross  income includes income, gain, loss or deductions from one or more
    42  unincorporated businesses conducted by such  city  resident  individual,
    43  estate  or  trust that are subject to the tax imposed by chapter five of
    44  this title, or a distributive share of income, gain, loss and deductions
    45  of, or guaranteed payments from,  one  or  more  partnerships  that  are
    46  subject to the tax imposed by such chapter, shall be allowed a credit as
    47  provided  in paragraph two of this subdivision against the tax otherwise
    48  due under  sections  11-1701,  11-1703,  11-1704  [and],  11-1704.1  and
    49  11-1704.2 of this [chapter] subchapter.
    50    (2)  (A)  Subject  to  the limitation set forth in subparagraph (B) of
    51  this paragraph, the credit allowed to a  taxpayer  for  a  taxable  year
    52  under this subdivision shall be determined as follows:
    53    (i)  For  taxable  years beginning on or after January first, nineteen
    54  hundred ninety-seven and before January first, two thousand seven:

        S. 602--A                           7

     1    (I) If the city taxable income is forty-two thousand dollars or  less,
     2  the credit shall be sixty-five percent of the amount determined in para-
     3  graph three of this subdivision.
     4    (II)  If  the  city  taxable income is greater than forty-two thousand
     5  dollars but not greater than one hundred forty-two thousand dollars, the
     6  amount of the credit shall be a percentage of the amount  determined  in
     7  paragraph three of this subdivision, such percentage to be determined by
     8  subtracting  from  sixty-five  percent,  one-tenth of a percentage point
     9  (.001) for every increment of two hundred dollars,  or  fractional  part
    10  thereof, of city taxable income in excess of forty-two thousand dollars.
    11    (III) If the city taxable income is greater than one hundred forty-two
    12  thousand  dollars,  the  credit  shall  be fifteen percent of the amount
    13  determined in paragraph three of this subdivision.
    14    (ii) For taxable years beginning on or after January first, two  thou-
    15  sand seven:
    16    (I)  If the city taxable income is forty-two thousand dollars or less,
    17  the credit shall be one hundred percent  of  the  amount  determined  in
    18  paragraph three of this subdivision.
    19    (II)  If  the  city  taxable income is greater than forty-two thousand
    20  dollars but less than one hundred forty-two thousand dollars, the amount
    21  of the credit shall be a percentage of the amount  determined  in  para-
    22  graph  three  of  this  subdivision, such percentage to be determined by
    23  subtracting  from  one  hundred  percent,  a  percentage  determined  by
    24  subtracting  forty-two thousand dollars from city taxable income, divid-
    25  ing the result by one hundred thousand dollars and multiplying by seven-
    26  ty-seven percent.
    27    (III) If the city taxable income is  one  hundred  forty-two  thousand
    28  dollars  or  greater,  the  credit  shall be twenty-three percent of the
    29  amount determined in paragraph three of this subdivision.
    30    (B) Notwithstanding anything to the contrary in  subparagraph  (A)  of
    31  this  paragraph,  the  credit  allowed  to a taxpayer for a taxable year
    32  under this subdivision shall not exceed the sum of the taxes that  would
    33  otherwise  be  imposed  by  sections  11-1701,  11-1703,  11-1704 [and],
    34  11-1704.1 and 11-1704.2 of this [chapter] subchapter  on  such  taxpayer
    35  for  such  taxable year after the allowance of any other credits allowed
    36  by this section or section 11-1721 of this chapter.
    37    § 8. This act shall take effect immediately and  shall  be  deemed  to
    38  have been in full force and effect on and after January 1, 2024.
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