S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   5004
 
                        2023-2024 Regular Sessions
 
                             I N  S E N A T E
 
                             February 21, 2023
                                ___________
 
 Introduced  by  Sens. SANDERS, ADDABBO, CLEARE, COONEY, GIANARIS, HARCK-
   HAM, HOYLMAN-SIGAL, KAVANAGH, KRUEGER, MAY, SALAZAR -- read twice  and
   ordered  printed, and when printed to be committed to the Committee on
   Budget and Revenue
 
 AN ACT to amend the tax law, in relation to providing an  exemption  for
   geothermal heat pump systems equipment

   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. Subdivision (a) of section 1115 of the tax law  is  amended
 by adding a new paragraph 47 to read as follows:
   (47) RECEIPTS FROM THE RETAIL SALE OF RESIDENTIAL GEOTHERMAL HEAT PUMP
 SYSTEMS EQUIPMENT AND OF THE SERVICE OF INSTALLING SUCH SYSTEMS SHALL BE
 EXEMPT  FROM  TAX  UNDER  THIS  ARTICLE. FOR PURPOSES OF THIS PARAGRAPH,
 "RESIDENTIAL GEOTHERMAL  HEAT  PUMP  SYSTEM  EQUIPMENT"  SHALL  MEAN  AN
 ARRANGEMENT OR COMBINATION OF COMPONENTS INSTALLED IN AND AROUND A RESI-
 DENTIAL BUILDING THAT USES THE GROUND OR GROUND WATER AS A THERMAL ENER-
 GY SOURCE OR AS A THERMAL ENERGY SINK DESIGNED TO PROVIDE AND DISTRIBUTE
 HEATING,  AND/OR COOLING, AND/OR HOT WATER, ALSO COMMONLY REFERRED TO AS
 GROUND SOURCE HEAT PUMP SYSTEMS. SUCH ARRANGEMENT  OR  COMPONENTS  SHALL
 NOT  INCLUDE  ANY  SORT  OF RECREATIONAL FACILITY OR EQUIPMENT USED AS A
 STORAGE MEDIUM.
   § 2. Section 1115 of the tax law is amended by adding a  new  subdivi-
 sion (ll) to read as follows:
   (LL)  RECEIPTS FROM THE RETAIL SALE OF COMMERCIAL GEOTHERMAL HEAT PUMP
 SYSTEMS EQUIPMENT AND OF THE SERVICE OF INSTALLING SUCH SYSTEMS SHALL BE
 EXEMPT FROM TAXES IMPOSED BY SECTIONS ELEVEN  HUNDRED  FIVE  AND  ELEVEN
 HUNDRED  TEN OF THIS ARTICLE. FOR PURPOSES OF THIS SUBDIVISION, "COMMER-
 CIAL GEOTHERMAL HEAT PUMP SYSTEM EQUIPMENT" SHALL MEAN AN ARRANGEMENT OR
 COMBINATION OF COMPONENTS INSTALLED IN AND AROUND A COMMERCIAL  BUILDING
 THAT  USES THE GROUND OR GROUND WATER AS A THERMAL ENERGY SOURCE OR AS A
 THERMAL ENERGY SINK DESIGNED TO PROVIDE AND DISTRIBUTE  HEATING,  AND/OR
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD02393-01-3
              

 S. 5004                             2
 
 COOLING,  AND/OR  HOT  WATER, ALSO COMMONLY REFERRED TO AS GROUND SOURCE
 HEAT PUMP SYSTEMS. SUCH ARRANGEMENT OR COMPONENTS SHALL NOT INCLUDE  ANY
 SORT OF RECREATIONAL FACILITY OR EQUIPMENT USED AS A STORAGE MEDIUM.
   §  3.  Subparagraph (xiv) of paragraph 4 of subdivision (a) of section
 1210 of the tax law, as added by section 2 of part WW of chapter  60  of
 the  laws  of  2016, is amended and a new subparagraph (xvi) is added to
 paragraph 4 to read as follows:
   [(xiv)] (XV) shall  omit,  unless  such  city  elects  otherwise,  the
 exemption for commercial fuel cell electricity generating systems equip-
 ment and electricity generated by such equipment provided in subdivision
 (kk)  of  section  eleven  hundred fifteen of this chapter[.]; AND (XVI)
 SHALL OMIT UNLESS SUCH CITY ELECTS OTHERWISE, THE RESIDENTIAL GEOTHERMAL
 HEAT PUMP SYSTEMS EQUIPMENT AND INSTALLATION EXEMPTION PROVIDED  FOR  IN
 PARAGRAPH  FORTY-SEVEN  OF  SUBDIVISION  (A)  OF  SECTION ELEVEN HUNDRED
 FIFTEEN OF THIS CHAPTER; AND SHALL OMIT UNLESS SUCH CITY  ELECTS  OTHER-
 WISE,  THE COMMERCIAL GEOTHERMAL HEAT PUMP SYSTEMS EQUIPMENT AND INSTAL-
 LATION EXEMPTION PROVIDED FOR IN  SUBDIVISION  (LL)  OF  SECTION  ELEVEN
 HUNDRED FIFTEEN OF THIS CHAPTER.
   §  4.  Subparagraph  (ii) of paragraph 1 of subdivision (a) of section
 1210 of the tax law, as amended by section 5 of part J of chapter 59  of
 the laws of 2021, is amended to read as follows:
   (ii) Any local law, ordinance or resolution enacted by any city, coun-
 ty  or  school  district, imposing the taxes authorized by this subdivi-
 sion, shall omit the residential  solar  energy  systems  equipment  and
 electricity  exemption  provided for in subdivision (ee), the commercial
 solar energy systems equipment and electricity exemption provided for in
 subdivision  (ii),  the  commercial  fuel  cell  electricity  generating
 systems  equipment and electricity generated by such equipment exemption
 provided for in subdivision (kk), THE RESIDENTIAL GEOTHERMAL  HEAT  PUMP
 SYSTEMS  EQUIPMENT  AND INSTALLATION EXEMPTION PROVIDED FOR IN PARAGRAPH
 FORTY-SEVEN OF SUBDIVISION (A),  THE  COMMERCIAL  GEOTHERMAL  HEAT  PUMP
 SYSTEMS EQUIPMENT AND INSTALLATION EXEMPTION PROVIDED FOR IN SUBDIVISION
 (LL)  and  the clothing and footwear exemption provided for in paragraph
 thirty of subdivision (a) of section  eleven  hundred  fifteen  of  this
 chapter, unless such city, county or school district elects otherwise as
 to  such  residential  solar  energy  systems  equipment and electricity
 exemption, such commercial solar energy systems equipment and  electric-
 ity  exemption,  commercial  fuel  cell  electricity  generating systems
 equipment and electricity generated by such equipment exemption or  such
 clothing  and  footwear exemption, SUCH RESIDENTIAL GEOTHERMAL HEAT PUMP
 SYSTEMS EQUIPMENT AND INSTALLATION EXEMPTION, SUCH COMMERCIAL GEOTHERMAL
 HEAT PUMP SYSTEMS EQUIPMENT AND INSTALLATION EXEMPTION OR SUCH  CLOTHING
 AND FOOTWEAR EXEMPTION.
   § 5. Paragraph 1 of subdivision (b) of section 1210 of the tax law, as
 amended  by  section  6  of part J of chapter 59 of the laws of 2021, is
 amended to read as follows:
   (1) Or, one or more of the taxes described in subdivisions  (b),  (d),
 (e)  and (f) of section eleven hundred five of this chapter, at the same
 uniform rate, including the transitional provisions  in  section  eleven
 hundred  six  of  this  chapter  covering  such taxes, but not the taxes
 described in subdivisions (a) and (c) of section eleven hundred five  of
 this  chapter. Provided, further, that where the tax described in subdi-
 vision (b) of section eleven hundred five of this  chapter  is  imposed,
 the  compensating  use  taxes described in [clauses] PARAGRAPHS (E), (G)
 and (H) of subdivision (a) of section eleven hundred ten of this chapter
 shall also be imposed. Provided, further, that where the taxes described
 S. 5004                             3
 
 in subdivision (b) of section eleven hundred five of  this  chapter  are
 imposed,  such  taxes shall omit: (A) the provision for refund or credit
 contained in subdivision (d) of section eleven hundred nineteen of  this
 chapter  with respect to such taxes described in such subdivision (b) of
 section eleven hundred five unless such city or county elects to provide
 such provision or, if so elected, to  repeal  such  provision;  (B)  the
 exemption provided in paragraph two of subdivision (ee) of section elev-
 en  hundred  fifteen  of  this chapter unless such county or city elects
 otherwise; (C) the exemption provided in paragraph  two  of  subdivision
 (ii)  of  section  eleven  hundred  fifteen of this chapter, unless such
 county or city elects otherwise; [and] (D)  the  exemption  provided  in
 paragraph  two  of subdivision (kk) of section eleven hundred fifteen of
 this chapter, unless such county or city elects otherwise; and  provided
 further  that where the tax described in subdivision (f) of such section
 eleven hundred five is imposed, such tax shall not apply to charges  for
 admission  to  race  tracks  and simulcast facilities; (E) THE EXEMPTION
 PROVIDED IN PARAGRAPH FORTY-SEVEN OF SUBDIVISION (A) OF  SECTION  ELEVEN
 HUNDRED  FIFTEEN  OF  THIS  CHAPTER,  UNLESS  SUCH COUNTY OR CITY ELECTS
 OTHERWISE; AND (F) THE EXEMPTION PROVIDED IN SUBDIVISION (LL) OF SECTION
 ELEVEN HUNDRED FIFTEEN OF THIS  CHAPTER,  UNLESS  SUCH  COUNTY  OR  CITY
 ELECTS OTHERWISE.
   §  6.  Subdivision  (d)  of section 1210 of the tax law, as amended by
 section 4 of part WW of chapter 60 of the laws of 2016,  is  amended  to
 read as follows:
   (d)  A local law, ordinance or resolution imposing any tax pursuant to
 this section, increasing or decreasing the rate of such  tax,  repealing
 or  suspending  such tax, exempting from such tax the energy sources and
 services described in paragraph three of subdivision (a) or of  subdivi-
 sion  (b)  of  this  section or changing the rate of tax imposed on such
 energy sources and services  or  providing  for  the  credit  or  refund
 described  in  clause  six  of subdivision (a) of section eleven hundred
 nineteen of this chapter, or electing or  repealing  the  exemption  for
 residential  solar  equipment  and  electricity  in  subdivision (ee) of
 section eleven  hundred  fifteen  of  this  [article]  CHAPTER,  or  the
 exemption  for commercial solar equipment and electricity in subdivision
 (ii) of section eleven hundred fifteen of  this  [article]  CHAPTER,  or
 electing or repealing the exemption for commercial fuel cell electricity
 generating systems equipment and electricity generated by such equipment
 in  subdivision (kk) of section eleven hundred fifteen of this [article]
 CHAPTER, OR ELECTING OR REPEALING THE EXEMPTION FOR RESIDENTIAL GEOTHER-
 MAL HEAT PUMP SYSTEMS EQUIPMENT AND INSTALLATION IN PARAGRAPH FORTY-SEV-
 EN OF SUBDIVISION (A) OF SECTION ELEVEN HUNDRED FIFTEEN OF THIS  CHAPTER
 OR  ELECTING  OR  REPEALING THE EXEMPTION FOR COMMERCIAL GEOTHERMAL HEAT
 PUMP SYSTEMS EQUIPMENT AND INSTALLATION IN SUBDIVISION (LL)  OF  SECTION
 ELEVEN  HUNDRED  FIFTEEN OF THIS CHAPTER must go into effect only on one
 of the following dates: March first,  June  first,  September  first  or
 December  first;  provided,  that  a  local law, ordinance or resolution
 providing for the exemption described in paragraph thirty of subdivision
 (a) of section eleven hundred fifteen of this chapter or  repealing  any
 such  exemption  or a local law, ordinance or resolution providing for a
 refund or credit described in subdivision (d) of section eleven  hundred
 nineteen of this chapter or repealing such provision so provided must go
 into  effect only on March first. No such local law, ordinance or resol-
 ution shall be effective unless a certified copy of such law,  ordinance
 or  resolution  is mailed by registered or certified mail to the commis-
 sioner at the commissioner's office in Albany at least ninety days prior
 S. 5004                             4
 
 to the date it is to become effective.  However,  the  commissioner  may
 waive and reduce such ninety-day minimum notice requirement to a mailing
 of  such  certified copy by registered or certified mail within a period
 of not less than thirty days prior to such effective date if the commis-
 sioner deems such action to be consistent with the commissioner's duties
 under  section twelve hundred fifty of this article and the commissioner
 acts by resolution. Where the restriction provided for in section twelve
 hundred twenty-three of this article as to the effective date of  a  tax
 and  the notice requirement provided for therein are applicable and have
 not been waived, the  restriction  and  notice  requirement  in  section
 twelve hundred twenty-three of this article shall also apply.
   §  7.  Subdivision  (a)  of section 1212 of the tax law, as amended by
 section 5 of part WW of chapter 60 of the laws of 2016,  is  amended  to
 read as follows:
   (a)  Any  school  district which is coterminous with, partly within or
 wholly within a city having a population of less than one hundred  twen-
 ty-five  thousand,  is hereby authorized and empowered, by majority vote
 of the whole number of its school  authorities,  to  impose  for  school
 district purposes, within the territorial limits of such school district
 and  without  discrimination between residents and nonresidents thereof,
 the taxes described in subdivision (b) of section  eleven  hundred  five
 (but  excluding  the  tax on prepaid telephone calling services) and the
 taxes described in [clauses] PARAGRAPHS (E) and (H) of  subdivision  (a)
 of  section eleven hundred ten, including the transitional provisions in
 subdivision (b) of section eleven hundred six of this chapter, so far as
 such provisions can be made applicable to  the  taxes  imposed  by  such
 school  district and with such limitations and special provisions as are
 set forth in this article, such taxes to be imposed at the rate of  one-
 half,  one,  one  and  one-half,  two, two and one-half or three percent
 which rate shall be uniform for all portions and all types  of  receipts
 and uses subject to such taxes. In respect to such taxes, all provisions
 of  the resolution imposing them, except as to rate and except as other-
 wise  provided  herein,  shall  be  identical  with  the   corresponding
 provisions in [such] article twenty-eight of this chapter, including the
 applicable  definition  and exemption provisions of such article, so far
 as the provisions of such article twenty-eight of this  chapter  can  be
 made  applicable  to  the taxes imposed by such school district and with
 such limitations and special provisions as are set forth in  this  arti-
 cle.  The  taxes  described in subdivision (b) of section eleven hundred
 five (but excluding the tax on prepaid telephone  calling  service)  and
 [clauses]  PARAGRAPHS  (E)  and (H) of subdivision (a) of section eleven
 hundred ten, including the transitional provision in subdivision (b)  of
 such  section  eleven hundred six of this chapter, may not be imposed by
 such school district unless the resolution imposes such taxes so  as  to
 include  all  portions and all types of receipts and uses subject to tax
 under such subdivision (but excluding the tax on prepaid telephone call-
 ing service) and [clauses] PARAGRAPHS.  Provided, however, that, where a
 school district imposes such taxes, such taxes shall omit the  provision
 for  refund  or  credit  contained  in subdivision (d) of section eleven
 hundred nineteen of this chapter with respect to such taxes described in
 such subdivision (b) of section eleven hundred five unless  such  school
 district  elects  to provide such provision or, if so elected, to repeal
 such provision, and shall omit the exemptions provided in paragraph  two
 of  subdivision  (ee)  and  paragraph two of subdivision (ii) of section
 eleven hundred fifteen of  this  chapter  unless  such  school  district
 elects otherwise, and shall omit the exemption provided in paragraph two
 S. 5004                             5
 
 of  subdivision  (kk)  of section eleven hundred fifteen of this chapter
 unless such  school  district  elects  otherwise,  AND  SHALL  OMIT  THE
 EXEMPTION  PROVIDED  IN  PARAGRAPH  FORTY-SEVEN  OF  SUBDIVISION  (A) OF
 SECTION  ELEVEN  HUNDRED  FIFTEEN  OF  THIS  CHAPTER  UNLESS SUCH SCHOOL
 DISTRICT ELECTS OTHERWISE, AND SHALL  OMIT  THE  EXEMPTION  PROVIDED  IN
 SUBDIVISION  (LL)  OF  SECTION  ELEVEN  HUNDRED  FIFTEEN OF THIS CHAPTER
 UNLESS SUCH SCHOOL DISTRICT ELECTS OTHERWISE.
   § 8. Section 1224 of the tax law is amended by adding two new subdivi-
 sions (c-3) and (c-4) to read as follows:
   (C-3) NOTWITHSTANDING ANY OTHER PROVISION OF LAW:  (1) WHERE A  COUNTY
 CONTAINING ONE OR MORE CITIES WITH A POPULATION OF LESS THAN ONE MILLION
 HAS  ELECTED  THE EXEMPTION FOR RESIDENTIAL GEOTHERMAL HEAT PUMP SYSTEMS
 EQUIPMENT AND INSTALLATION PROVIDED IN PARAGRAPH FORTY-SEVEN OF SUBDIVI-
 SION (A) OF SECTION ELEVEN HUNDRED FIFTEEN OF THIS CHAPTER, A CITY WITH-
 IN SUCH COUNTY SHALL HAVE THE PRIOR RIGHT TO IMPOSE TAX ON  SUCH  EXEMPT
 EQUIPMENT  AND/OR  INSTALLATION TO THE EXTENT OF ONE HALF OF THE MAXIMUM
 RATES AUTHORIZED UNDER SUBDIVISION (A) OF SECTION TWELVE HUNDRED TEN  OF
 THIS ARTICLE;
   (2)  WHERE  A  CITY OF LESS THAN ONE MILLION HAS ELECTED THE EXEMPTION
 FOR RESIDENTIAL GEOTHERMAL HEAT PUMP SYSTEMS EQUIPMENT AND  INSTALLATION
 PROVIDED  IN  PARAGRAPH FORTY-SEVEN OF SUBDIVISION (A) OF SECTION ELEVEN
 HUNDRED FIFTEEN OF THIS CHAPTER,  THE  COUNTY  IN  WHICH  SUCH  CITY  IS
 LOCATED  SHALL  HAVE THE PRIOR RIGHT TO IMPOSE TAX ON SUCH EXEMPT EQUIP-
 MENT AND/OR INSTALLATION TO THE EXTENT OF ONE HALF OF THE MAXIMUM  RATES
 AUTHORIZED  UNDER  SUBDIVISION (A) OF SECTION TWELVE HUNDRED TEN OF THIS
 ARTICLE.
   (C-4) NOTWITHSTANDING ANY OTHER PROVISION OF LAW:  (1) WHERE A  COUNTY
 CONTAINING ONE OR MORE CITIES WITH A POPULATION OF LESS THAN ONE MILLION
 HAS  ELECTED  THE  EXEMPTION FOR COMMERCIAL GEOTHERMAL HEAT PUMP SYSTEMS
 EQUIPMENT AND INSTALLATION PROVIDED IN SUBDIVISION (LL) OF SECTION ELEV-
 EN HUNDRED FIFTEEN OF THIS CHAPTER, A CITY WITHIN SUCH COUNTY SHALL HAVE
 THE PRIOR RIGHT TO IMPOSE TAX ON SUCH EXEMPT EQUIPMENT AND/OR  INSTALLA-
 TION  TO  THE  EXTENT  OF ONE HALF OF THE MAXIMUM RATES AUTHORIZED UNDER
 SUBDIVISION (A) OF SECTION TWELVE HUNDRED TEN OF THIS ARTICLE;
   (2) WHERE A CITY OF LESS THAN ONE MILLION HAS  ELECTED  THE  EXEMPTION
 FOR  COMMERCIAL  GEOTHERMAL HEAT PUMP SYSTEMS EQUIPMENT AND INSTALLATION
 PROVIDED IN SUBDIVISION (LL) OF SECTION ELEVEN HUNDRED FIFTEEN  OF  THIS
 CHAPTER,  THE  COUNTY IN WHICH SUCH CITY IS LOCATED SHALL HAVE THE PRIOR
 RIGHT TO IMPOSE TAX ON SUCH EXEMPT EQUIPMENT AND/OR INSTALLATION TO  THE
 EXTENT OF ONE HALF OF THE MAXIMUM RATES AUTHORIZED UNDER SUBDIVISION (A)
 OF SECTION TWELVE HUNDRED TEN OF THIS ARTICLE.
   §  9. This act shall take effect on the first day of a sales tax quar-
 terly period, as described in subdivision (b) of section 1136 of the tax
 law, beginning at least ninety days after the date this act  shall  have
 become a law and shall apply to sales made on or after such date.