S T A T E O F N E W Y O R K
________________________________________________________________________
9827
I N A S S E M B L Y
February 14, 2018
___________
Introduced by M. of A. CUSICK, WALKER -- read once and referred to the
Committee on Ways and Means
AN ACT to amend the real property tax law and the administrative code of
the city of New York, in relation to applications by certain electric
generating facilities for tax abatements for industrial and commercial
construction work on properties in a city of one million or more
persons
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. Legislative findings. The legislature hereby finds that the
2011 amendment to the industrial and commercial abatement program was
succesful in preventing a large increase in capacity rates for electric-
ity that would have cost ratepayers in the city of New York hundreds of
millions of dollars had the law not been changed. However, in the haste
to adopt that law, a new peaking power plant fell through the cracks and
has been paying property taxes since it began operations in 2012, even
though the 2011 statute clearly intended that industrial and commercial
abatement program benefits be provided to peaking power plants as a
right. This act would correct that defect in the statute and enable the
facility to receive industrial and commercial abatement program benefits
prospectively.
§ 2. Subdivision 17 of section 489-aaaaaa of the real property tax
law, as amended by chapter 28 of the laws of 2011, is amended to read as
follows:
17. "Utility property" means property and equipment as described in
paragraphs (c), (d), (e), (f) and (i) of subdivision twelve of section
one hundred two of this chapter that is used in the ordinary course of
business by its owner or any other entity or property as described in
paragraphs (a) and (b) of subdivision twelve of section one hundred two
of this chapter that is owned by any entity that uses in the ordinary
course of business property and equipment as described in paragraphs
(c), (d), (e), (f) and (i) of subdivision twelve of section one hundred
two of this chapter, without regard to the classification of such prop-
erty and equipment for real property tax purposes pursuant to section
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD14515-01-8
A. 9827 2
eighteen hundred two of this chapter, except that any such property and
equipment used solely to serve the building to which they are attached
shall not be deemed utility property. Notwithstanding any provision of
this title to the contrary, peaking units shall not be considered utili-
ty property. For purposes of this title, "peaking unit" shall mean a
generating unit that: (a) is determined by the New York independent
system operator or a federal or New York state energy regulatory commis-
sion to constitute a peaking unit as set forth in section 5.14.1.2 of
the New York independent system operator's market administration and
control area services tariff, as such term existed as of April first,
two thousand eleven; or (b) has an annual average operation, during the
calendar year preceding the taxable status date, of less than eighteen
hours following each start of the unit; for purposes of calculating the
annual average, operations during any period covered by any major emer-
gency declaration issued by the New York independent system operator,
northeast power coordinating council, or other similar entity shall be
excluded; OR (C) NOTWITHSTANDING THE REQUIREMENTS AND PROVISIONS OF THIS
TITLE, ANY PEAKING UNIT THAT WAS PLANNED, APPROVED AND UNDER
CONSTRUCTION BETWEEN THE EFFECTIVE DATE OF THIS TITLE AND THE EFFECTIVE
DATE OF CHAPTER TWENTY-EIGHT OF THE LAWS OF TWO THOUSAND ELEVEN, AND
UPON GOING INTO SERVICE EXCLUSIVELY PROVIDES ELECTRICITY TO ZONE J,
SHALL BE DEEMED ELIGIBLE FOR THE BENEFITS OF THIS TITLE; PROVIDED,
HOWEVER, THAT THE BENEFIT PERIOD FOR A PEAKING UNIT SHALL BE AS SET
FORTH IN PARAGRAPH (B-1) OF SUBDIVISION THREE OF SECTION FOUR HUNDRED
EIGHTY-NINE-BBBBBB OF THIS TITLE; AND PROVIDED, FURTHER, THAT SUCH BENE-
FITS SHALL COMMENCE UPON THE EFFECTIVE DATE OF THIS PARAGRAPH. A "peak-
ing unit" under this title shall include all real property used in
connection with the generation of electricity, and any facilities used
to interconnect the peaking unit with the electric transmission or
distribution system, but shall not include any facilities that are part
of the electric transmission or distribution system; it may be comprised
of a single turbine and generator or multiple turbines and generators
located at the same site. Notwithstanding any provision of this title to
the contrary, a peaking unit shall be considered industrial property,
provided however that the benefit period for a peaking unit shall be as
set forth in paragraph (b-1) of subdivision three of section four
hundred eighty-nine-bbbbbb of this title.
§ 3. Subdivision q of section 11-268 of the adminsitrative code of the
city of New York, as amended by chapter 28 of the laws of 2011, is
amended to read as follows:
q. "Utility property" means property and equipment as described in
paragraphs (c), (d), (e), (f) and (i) of subdivision twelve of section
one hundred two of the real property tax law that is used in the ordi-
nary course of business by its owner or any other entity or property as
described in paragraphs (a) and (b) of subdivision twelve of section one
hundred two of such law that is owned by any entity that uses in the
ordinary course of business property and equipment as described in para-
graphs (c), (d), (e), (f) and (i) of subdivision twelve of section one
hundred two of such law, without regard to the classification of such
property and equipment for real property tax purposes pursuant to
section eighteen hundred two of such law, except that any such property
and equipment used solely to serve the building to which they are
attached shall not be deemed utility property. Notwithstanding any
provision of this part to the contrary, peaking units shall not be
considered utility property. For purposes of this part, "peaking unit"
shall mean a generating unit that: (a) is determined by the New York
A. 9827 3
independent system operator or a federal or New York state energy regu-
latory commission to constitute a peaking unit as set forth in section
5.14.1.2 of the New York independent system operator's market adminis-
tration and control area services tariff, as such term existed as of
April first, two thousand eleven; or (b) has an annual average opera-
tion, during the calendar year preceding the taxable status date, of
less than eighteen hours following each start of the unit; for purposes
of calculating the annual average, operations during any period covered
by any major emergency declaration issued by the New York independent
system operator, northeast power coordinating council, or other similar
entity shall be excluded; OR (C) NOTWITHSTANDING THE REQUIREMENTS AND
PROVISIONS OF THIS PART, ANY PEAKING UNIT THAT WAS PLANNED, APPROVED AND
UNDER CONSTRUCTION BETWEEN THE EFFECTIVE DATE OF TITLE TWO-F OF ARTICLE
FOUR OF THE REAL PROPERTY TAX LAW AND THE EFFECTIVE DATE OF CHAPTER
TWENTY-EIGHT OF THE LAWS OF TWO THOUSAND ELEVEN, AND UPON GOING INTO
SERVICE EXCLUSIVELY PROVIDES ELECTRICITY TO ZONE J, SHALL BE DEEMED
ELIGIBLE FOR THE BENEFITS OF THIS PART; PROVIDED, HOWEVER, THAT THE
BENEFIT PERIOD FOR A PEAKING UNIT SHALL BE AS SET FORTH IN SUBPARAGRAPH
(A) OF PARAGRAPH TWO OF SUBDIVISION C OF SECTION 11-269 OF THIS PART;
AND PROVIDED, FURTHER, THAT SUCH BENEFITS SHALL COMMENCE UPON THE EFFEC-
TIVE DATE OF THIS PARAGRAPH. A "peaking unit" under this part shall
include all real property used in connection with the generation of
electricity, and any facilities used to interconnect the peaking unit
with the electric transmission or distribution system, but shall not
include any facilities that are part of the electric transmission or
distribution system; it may be comprised of a single turbine and genera-
tor or multiple turbines and generators located at the same site.
Notwithstanding any provision of this part to the contrary, a peaking
unit shall be considered industrial property, provided however that the
benefit period for a peaking unit shall be as set forth in paragraph
two-a of subdivision c of section 11-269 of this part.
§ 4. This act shall take effect immediately.