S T A T E   O F   N E W   Y O R K
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                                 1465--A

                       2015-2016 Regular Sessions

                          I N  A S S E M B L Y

                            January 12, 2015
                               ___________

Introduced  by  M. of A. LENTOL, TITONE, ABBATE, THIELE, JAFFEE, COOK --
  Multi-Sponsored by -- M. of A. PERRY -- read once and referred to  the
  Committee  on  Ways  and  Means -- committee discharged, bill amended,
  ordered reprinted as amended and recommitted to said committee

AN ACT to amend the tax law, in relation to the creation of  the  empire
  state music production credit

  THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1. The tax law is amended by adding a new section 42  to  read
as follows:
  S 42.  EMPIRE STATE MUSIC PRODUCTION CREDIT. (A)(1) ALLOWANCE OF CRED-
IT. A TAXPAYER WHICH IS A QUALIFIED MUSIC PRODUCTION COMPANY, OR A QUAL-
IFIED  INDEPENDENT MUSIC PRODUCTION COMPANY, OR WHICH IS A SOLE PROPRIE-
TOR OF OR  A  MEMBER  OF  A  PARTNERSHIP  WHICH  IS  A  QUALIFIED  MUSIC
PRODUCTION  COMPANY OR A QUALIFIED INDEPENDENT MUSIC PRODUCTION COMPANY,
AND WHICH IS SUBJECT TO TAX UNDER ARTICLE NINE-A OR TWENTY-TWO  OF  THIS
CHAPTER, SHALL BE ALLOWED A CREDIT AGAINST SUCH TAX.
  (2)  THE  AMOUNT OF THE CREDIT SHALL BE THE PRODUCT (OR PRO RATA SHARE
OF THE PRODUCT, IN THE CASE OF A MEMBER OF A PARTNERSHIP) OF TWENTY-FIVE
PERCENT AND THE QUALIFIED PRODUCTION COSTS PAID  IN  THE  PRODUCTION  OF
MUSIC  BY  THE TAXPAYER.   QUALIFYING MUSIC PRODUCTIONS SHALL BE COMMER-
CIALLY LICENSED SOUND RECORDING PROJECTS HAVING AS THEIR PRINCIPAL PLACE
OF PRODUCTION AND RECORDING THIS STATE  AND  REQUIRING  EXPENDITURES  IN
EXCESS  OF  TWENTY-FIVE  THOUSAND  DOLLARS.  IF  THE ANNUAL COST OF SUCH
PRODUCTIONS TO A TAXPAYER EXCEEDS ONE HUNDRED THOUSAND DOLLARS,  BUT  NO
SINGLE  SUCH  PRODUCTION  EXCEEDS  ONE  HUNDRED  THOUSAND  DOLLARS, SUCH
TAXPAYER MAY APPLY FOR THE CREDIT ALLOWED BY THIS SECTION ON  AN  AGGRE-
GATE BASIS PROVIDED SUCH TAXPAYER EMPLOYES TEN OR MORE RESIDENTS OF THIS
STATE. QUALIFIED PRODUCTION COSTS SHALL MEAN COSTS FOR TANGIBLE PROPERTY
USED AND SERVICES PERFORMED DIRECTLY AND PREDOMINANTLY IN THE PRODUCTION
OF   QUALIFIED  MUSIC  PRODUCTION  IN  THIS  STATE.    QUALIFYING  MUSIC

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD01211-03-5
              

A. 1465--A                          2

PRODUCTION COSTS SHALL INCLUDE STUDIO RENTAL  FEES  AND  RELATED  COSTS;
INSTRUMENT  AND EQUIPMENT RENTAL FEES; PRODUCTION SESSION FEES FOR MUSI-
CIANS, SONGWRITERS, COMPOSERS, ARRANGERS, MUSIC PRODUCERS,  PROGRAMMERS,
ENGINEERS  AND  TECHNICIANS; MIXING AND MASTERING SERVICES OF QUALIFYING
MUSIC PRODUCTIONS; AND HOTEL CATERING AND LOCAL TRANSPORTATION  EXPENDI-
TURES  DIRECTLY  RELATED  TO  MUSIC  PRODUCTION. COSTS SHALL NOT INCLUDE
RECORDING LIVE CONCERTS; ARTISTS AND  PRODUCER  ROYALTIES  OR  ADVANCES;
LICENSING  FEES  FOR  SAMPLES;  INTERPOLATIONS  OR OTHER MUSIC CLEARANCE
COSTS; MASTERING OR POST-PRODUCTION EXPENDITURES FOR PROJECTS THAT  WERE
NOT  PRINCIPALLY TRACKED AND RECORDED IN THIS STATE; NOR ANY COSTS ASSO-
CIATED  WITH  MANUFACTURING,   DUPLICATION,   PACKAGING,   DISTRIBUTION,
PROMOTION, MARKETING AND TOURING NOT SPECIFICALLY OUTLINED ABOVE.
  (3)  NO QUALIFIED PRODUCTION COSTS USED BY A TAXPAYER AS THE BASIS FOR
THE ALLOWANCE OF THE CREDIT PROVIDED FOR UNDER  THIS  SECTION  SHALL  BE
USED BY SUCH TAXPAYER TO CLAIM ANY OTHER CREDIT ALLOWED PURSUANT TO THIS
CHAPTER.
  (B)  ALLOCATION OF CREDIT. THE AGGREGATE AMOUNT OF TAX CREDITS ALLOWED
UNDER THIS SECTION, SUBDIVISION FIFTY OF SECTION TWO HUNDRED  TEN-B  AND
SUBSECTION  (CCC)  OF  SECTION  SIX  HUNDRED  SIX OF THIS CHAPTER IN ANY
CALENDAR YEAR SHALL BE TWENTY-FIVE MILLION DOLLARS AND ONE  MILLION  TWO
HUNDRED  FIFTY THOUSAND DOLLARS IN ANY GIVEN WEEK. SUCH AGGREGATE AMOUNT
OF CREDITS SHALL BE ALLOCATED BY THE  EMPIRE  STATE  DEVELOPMENT  CORPO-
RATION  AMONG  TAXPAYERS  IN  ORDER  OF  PRIORITY BASED UPON THE DATE OF
FILING AN APPLICATION FOR ALLOCATION OF  MUSIC  PRODUCTION  CREDIT  WITH
SUCH  OFFICE.   NO SINGLE TAXPAYER MAY CLAIM OR BE AWARDED MORE THAN TEN
PERCENT OF THE AGGREGATE  AMOUNT  OF  TAX  CREDITS  ALLOWED  UNDER  THIS
SECTION.    IF  THE TOTAL AMOUNT OF ALLOCATED CREDITS APPLIED FOR IN ANY
PARTICULAR YEAR EXCEEDS THE AGGREGATE AMOUNT OF TAX CREDITS ALLOWED  FOR
SUCH  YEAR  UNDER  THIS  SECTION, SUCH EXCESS SHALL BE TREATED AS HAVING
BEEN APPLIED FOR ON THE FIRST DAY OF THE SUBSEQUENT YEAR.
  (C) CROSS-REFERENCES. FOR APPLICATION OF THE CREDIT  PROVIDED  FOR  IN
THIS SECTION, SEE THE FOLLOWING PROVISIONS OF THIS CHAPTER:
  (1) ARTICLE 9-A: SECTION 210-B: SUBDIVISION 50
  (2) ARTICLE 22: SECTION 606: SUBSECTION (CCC)
  S  2. Section 210-B of the tax law is amended by adding a new subdivi-
sion 50 to read as follows:
  50. EMPIRE STATE MUSIC PRODUCTION CREDIT. (A) ALLOWANCE OF  CREDIT.  A
TAXPAYER  WHO  IS ELIGIBLE PURSUANT TO SECTION FORTY-TWO OF THIS CHAPTER
SHALL BE ALLOWED A CREDIT TO BE COMPUTED AS  PROVIDED  IN  SUCH  SECTION
FORTY-TWO AGAINST THE TAX IMPOSED BY THIS ARTICLE.
  (B)  APPLICATION  OF CREDIT. THE CREDIT ALLOWED UNDER THIS SUBDIVISION
FOR ANY TAXABLE YEAR SHALL NOT REDUCE THE TAX DUE FOR SUCH YEAR TO  LESS
THAN  THE  AMOUNT  PRESCRIBED  IN  PARAGRAPH  (D)  OF SUBDIVISION ONE OF
SECTION TWO HUNDRED TEN OF THIS ARTICLE.  PROVIDED, HOWEVER, THAT IF THE
AMOUNT OF THE CREDIT ALLOWABLE UNDER THIS SUBDIVISION  FOR  ANY  TAXABLE
YEAR  REDUCES  THE TAX TO SUCH AMOUNT, THE EXCESS SHALL BE TREATED AS AN
OVERPAYMENT OF TAX TO BE CREDITED OR REFUNDED  IN  ACCORDANCE  WITH  THE
PROVISIONS OF SECTION ONE THOUSAND EIGHTY-SIX OF THIS CHAPTER. PROVIDED,
HOWEVER, THE PROVISIONS OF SUBSECTION (C) OF SECTION ONE THOUSAND EIGHT-
Y-EIGHT OF THIS CHAPTER NOTWITHSTANDING, NO INTEREST SHALL BE PAID THER-
EON.
  S  3. Subparagraph (B) of paragraph 1 of subsection (i) of section 606
of the tax law is amended by adding  a  new  clause  (xli)  to  read  as
follows:

A. 1465--A                          3

(XLI) EMPIRE STATE MUSIC             AMOUNT OF CREDIT FOR
PRODUCTION CREDIT UNDER              QUALIFIED PRODUCTION CREDIT
SUBSECTION (CCC)                     MUSIC UNDER SUBDIVISION
                                     FIFTY OF SECTION TWO
                                     HUNDRED TEN-B
  S  4. Section 606 of the tax law is amended by adding a new subsection
(ccc) to read as follows:
  (CCC) EMPIRE STATE MUSIC PRODUCTION CREDIT. (1) ALLOWANCE OF CREDIT. A
TAXPAYER WHO IS ELIGIBLE PURSUANT TO SECTION FORTY-TWO OF  THIS  CHAPTER
SHALL  BE  ALLOWED  A  CREDIT TO BE COMPUTED AS PROVIDED IN SUCH SECTION
FORTY-TWO AGAINST THE TAX IMPOSED BY THIS ARTICLE.
  (2) APPLICATION OF CREDIT. IF THE AMOUNT OF THE CREDIT ALLOWABLE UNDER
THIS SUBSECTION FOR ANY TAXABLE YEAR EXCEEDS THE TAXPAYER'S TAX FOR SUCH
YEAR, THE EXCESS SHALL BE TREATED AS AN OVERPAYMENT OF TAX TO BE CREDIT-
ED OR REFUNDED AS PROVIDED IN SECTION SIX  HUNDRED  EIGHTY-SIX  OF  THIS
ARTICLE, PROVIDED, HOWEVER, THAT NO INTEREST SHALL BE PAID THEREON.
  S  5.  The  empire state development corporation shall conduct a study
analyzing the economic impact of the tax credit authorized  pursuant  to
section  one  of this act and shall report its findings, conclusions and
recommendations to the governor and the legislature  on  or  before  one
year  from  the  date this act shall become a law, and shall submit with
its report such legislative proposals as it deems necessary to implement
its recommendations.   The empire state  development  corporation  shall
list the recipients of the tax credit authorized pursuant to section one
of this act on their official internet website.
  S 6. This act shall take effect on the one hundred eightieth day after
it shall have become a law.